1967-10-03

HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Hon. J. W. Monleith (Perth):: Mr. Speaker, I should like to direct a question to the Minister of Finance. In the light of the concern of the provinces over the cost of medicare, will the minister review medicare proposals with the provinces before establishing priorities, as mentioned in his speech last evening?


Hon. Mitchell Sharp (Minister of Finance):: Mr. Speaker, I would think a question of this kind which relates to government policy in general should be directed to the Prime Minister rather than the Minister of Finance. I can assure the hon. member that all expenditure programs are under very careful review. I shall take into account his suggestion that we should consult with the provinces.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. David Lewis (York Souih):: Mr. Speaker, I have a question I wished to address to either the Prime Minister or the Secretary of State for External Affairs, neither of whom is in his seat. Perhaps one of the parliamentary secretaries will draw this question to the attention of one or the other of them for answer tomorrow.
In view of reports that the nuclear planning group of NATO, of which Canada is presently a member, met in Ankara last Friday and debated a Turkish proposal for nuclear mines to be laid on the eastern border of Turkey with the Soviet union, can the Prime Minister or the Secretary of State for External Affairs inform the house what position the Minister of National Defence, who was our representative in that group at this meeting, took on behalf of Canada in respect of this proposal? May we also have the assurance that Canada will vigorously oppose this 27053-1745
dangerous proposal, since it is clearly against the spirit of the non-proliferation policy which Canada has supported?


Hon. Paul Hellyer (Minister of Transport):: Mr. Speaker, I will be glad to draw this question to the attention of the Prime Minister.



INQUIRIES OF THE MINISTRY

[Stage Direction]
On the orders of the day:
['Order. I doubt whether this is a question of immediate urgency. I do not think the question is in order at this time.']
Mr. Gerard Laprise (Chapleau):: Mr. Speaker, I wanted to direct a question to the Secretary of State but, in her absence, I will put it to the Acting Prime Minister (Mr. Hellyer).
Could he tell us if the organization called T.E.Q., that is the Student Workers of Quebec, has received subventions from the federal government since the Company of Young Canadians was set up?


Mr. Speaker:: I think that question should be put on the order paper.


Mr. Real Caoueite (Villeneuve):: Mr. Speaker, I should like to direct a question to the Minister of Finance.
Last night the minister said that the increase in the interest rate for housing was designed to attract foreign investments in Canada. Could the minister tell us where the foreigners take the funds they invest in Canada and, on the other hand, where does Canada draw the funds it invests in foreign countries?


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



[Stage Direction]
On the orders of the day:
Mr. Howard Johnston (Okanagan-Revel-sioke):: Mr. Speaker, my question was for the Secretary of State for External Affairs,
October 3, 1967

Inquiries of the Ministry but in his absence perhaps one of the parliamentary secretaries could answer it. Has the Canadian government received an invitation from trade and industry minister Takeo Miki of Japan to become a founding member of an "Asia-Pacific sphere" and to accept greater responsibility in that area?


Mr. Speaker:: Order. I doubt whether this is a question of immediate urgency. I do not think the question is in order at this time.



FINANCE


[Stage Direction]
On the orders of the day:
Hon. George Hees (Northumberland):: Mr. Speaker, I should like to direct a question to the Prime Minister. In view of the opinion of the Canadian Economic Council that taxes will have to be raised if the present rate of government expenditures continues, and the contribution these expenditures are making to inflation, is it the intention of the government to reduce its expenditures and bring them more in line with its income?


Mr. Speaker:: Order, please. I would think this question is much too large in scope and cannot be asked at this time.


Hon. E. D. Fulton (Kamloops):: Mr. Speaker, I wish to direct a related question to the Minister of Finance. Could the minister tell the house when we may expect to be provided with a list, or when he may be in a position to make a statement outlining the various items of the estimates which have been reduced in accordance with the survey to which the minister recently referred?


Mitchell William Sharp: Mr. Speaker, in any statements I have made either in this house or outside I have been referring to the study that is under way of the spending estimates for 1968-69. Those will be submitted to the house for study as soon as they have been approved and presented, in the usual manner. Our endeavour for this year is to stay within the financial program that I outlined in our budget.


Edmund Davie Fulton: A supplementary question, Mr. Speaker. I take it from the minister's answer that there is no attempt to reduce the spending as outlined in the estimates for this year?


Mr. Speaker:: Order, please. I suggest to the hon. member that the supplementary question is argumentative.


Edmund Davie Fulton: I assure you, sir, that I am just seeking information. I will try to phrase my question in another way. I would like to be certain about this in order that there may be no misunderstanding. May we take it from the minister's statement that the efforts to reduce expenditures do not apply to this year's current estimates?


Mitchell William Sharp: Mr. Speaker, I can assure the hon. gentleman that to keep our expenditures within our program as outlined to this house will require considerable economies. But our main effort is to see that in the coming fiscal year we are working toward a closer balance between expenditures and revenues, because I think that will be appropriate to the circumstances we will face in that year, and to reduce our borrowings as far as possible so that we do not make excessive demands upon the market.


Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, I have a supplementary question arising out of the minister's answer to my colleague from Kamloops and the statement made last night by the minister. The minister said that the allocation of priorities would be not from the top but through the reduction or dropping of programs. Could the minister indicate to the house whether there will be any dropping of programs in order to keep expenses within the budgetary provisions of this year?


Mitchell William Sharp: Mr. Speaker, there are some expenditures the government is not undertaking this year that we had otherwise planned to undertake.


Marcel Joseph Aimé Lambert: A further supplementary question, Mr. Speaker. Will the minister, in the next few days during the budget debate, indicate to the house which programs and expenditures have been pared?


Mitchell William Sharp: I expect I shall be participating in the budget debate at the opening. My colleague the Minister of National Revenue will be dealing particularly with the efforts, the very successful efforts, that have been made during his term of office at least to keep expenditures under control and to eliminate those that are now obsolete or unnecessary.


Some hon. Members:: Hear, hear.
October 3, 1367	COMMONS



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Mr. Frank Howard (Skeena):: Mr. Speaker,
I would like to direct a question to the Minister of Transport and ask him whether he is aware of the fact that a few days ago the Canadian National Railways made a decision to reduce the frequency of their passenger service along the Prince Rupert to Prince George line from the one train a day schedule to three trains a week; and if he is aware of this, could he indicate what steps he might take to make representations to the C.N.R. to induce them to change it?


Mr. Speaker:: I think the question should be placed on the order paper. In any event the hon. member has made a representation to the minister.



POLLUTION


[Stage Direction]
On the orders of the day:
Mr. G. H. Aiken (Parry Sound-Muskoka):: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources. In view of the announcement that the new fuels research centre will be investigating the suppression of atmospheric pollution, is his department taking over responsibility for air pollution control?


Hon. Jean-Luc Pepin (Minister of Energy, Mines and Resources):: No, Mr. Speaker.


Mr. D. V. Pugh (Okanagan Boundary):: have a supplementary question, Mr. Speaker. Is there a federal authority with continuing jurisdiction to inquire into pollution in international water systems such as the Okanagan system?


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


Mr. Robert Muir (Cape Breton North and Victoria):: I have a supplementary question for the Minister of Energy, Mines and Resources. Can he tell us whether the government has taken any further action to co-ordinate all matters of pollution within one department?


Mr. Speaker:: Order. I would think this is the type of question which should not be asked at this time.
DEBATES	2749
Inquiries of the Ministry


Robert Muir: My question is directed to the Prime Minister. May I ask the right hon. gentleman whether it is the intention of the government to place matters concerning air and water pollution under one department?


Right Hon. L. B. Pearson (Prime Minister):: It is important, Mr. Speaker, to have these matters co-ordinated, and they are being coordinated.



AIRPORTS


[Stage Direction]
On the orders of the day:
Mr. Gilles Gregoire (Lapointe):: Mr. Speaker, I should like to put a question to the Minister of Transport (Mr. Hellyer).
As the Montreal airport is the only airport in Canada where luggage porters charge a fixed amount for each piece of luggage carried, would the minister tell us whether he has received representations for the removal of this obligatory charge and can he apprise us of the intentions of his department in that respect?


Mr. Speaker:: Order. May I suggest to the member for Lapointe that this question is not urgent enough to be acceptable at this time and, further more it could easily be put on the order paper.


Gilles Grégoire: At ten o'clock, Mr. Speaker.



PUBLIC WORKS


[Stage Direction]
On the orders of the day:
Mr. Stanley Haidasz (Parkdale):: Mr. Speaker, I should like to ask the Minister of Finance what funds are presently available to the city of Toronto for the construction of Toronto's centennial project, the St. Lawrence centre for the arts; and could he also inform the house as to the site for the construction of the C.B.C. building.


Mr. Speaker:: Order. The hon. member is asking for statistical information and this type of question cannot be asked at this time.


Stanley Haidasz: Ten o'clock, Mr. Speaker.
October 3, 1967

Inquiries of the Ministry CANADIAN CONSTITUTION



INQUIRY AS TO REPORTS BY DEPARTMENTAL COMMITTEES

[Stage Direction]
On the orders of the day:
Hon. Michael Starr (Leader of the Opposition):: Mr. Speaker, I wish to address my question to the right hon. Prime Minister and ask him whether the government has recently received a report from the committee set up last June 26 as indicated by the Prime Minister at that time to make an economic investigation into the interrelation between Quebec and the rest of the country.


Lester Bowles Pearson: Mr. Speaker, in reply to the question of the Leader of the Opposition I would like to say I will have to look into the matter. I do not think that report has been received.


Michael Starr: I have a supplementary question. While the Prime Minister is looking into the matter, can he also find out how many committees within the various departments are at present working on matters affecting the constitutional structure of Canada, and what reports if any are available from them?


Lester Bowles Pearson: I will be glad to look into that. If my memory serves me right I think I did make a statement on this matter in the house last June, but I will be glad to look into the whole question.



FISHERIES


[Stage Direction]
On the orders of the day:
Mr. R. W. Prittie (Burnaby-Richmond):: Mr. Speaker, I wish to direct a question to the Minister of Fisheries. In his discussions with the minister of fisheries of the Soviet union was the possibility of the U.S.S.R. entering into the north Pacific salmon fisheries treaty discussed, and did the Soviet union indicate willingness to join that treaty?


Hon.   H.-J. Robichaud@Minister of Fisheries: Mr. Speaker, the matter referred to by the hon. member was discussed between the minister of fisheries of the U.S.S.R. and myself during his recent visit to Canada which concluded yesterday.



AIR TRANSPORT


[Stage Direction]
On the orders of the day:
Mr. Robert McCleave (Halifax):: Mr. Speaker, I wish to direct a question to the


Minister of Transport. Will the minister take a fresh look at government policy which now prevents Canada's other major air line from serving Atlantic Canada?


Mr. Speaker:: Order, please. The hon. member is making a submission to the minister. I do not think this can be accepted in the form of a question at this time.


Robert Jardine McCleave: With respect, Mr. Speaker, I was not making a submission. I was asking for an answer, but I will put the matter down for ten o'clock if I do not get the answer now.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. Jack A. Irvine (London):: Mr. Speaker, I have been awaiting the return of the Minister of National Defence in order that I might ask him a very important question, but because of the urgency perhaps I may direct it to the right hon. Prime Minister. In order to settle the uncertainty prevailing in universities all across Canada will the Prime Minister say whether it is the intention to continue reserve army training at Canadian universities?


Paul Theodore Hellyer: Mr. Speaker, as the acting minister I may take this question. A decision has been taken by the federal government which is being made known to the universities at the present time. I am not sure whether that has been completed. Just as soon as possible a public announcement will be made.


Mr. Lloyd R. Crouse (Queens-Lunenburg):: As a supplementary question, when that announcement is made how many officers in training under the Canadian officers training corps and the regular officer training plans will be affected by the change?


Mr. Speaker:: Order. This question is too detailed. Perhaps I should suggest that unless the Minister of Transport is answering questions in his capacity as Acting Minister of National Defence he cannot be asked questions relating to that department.


Paul Theodore Hellyer: Mr. Speaker, in order to set the record straight I wish to say that was the capacity in which I was acting.


Mr. L. M. Brand (Saskatoon):: Mr. Speaker, as a supplementary question I would like to ask whether the Acting Minister of National
October 3, 1967	COMMONS
Defence is aware that this has already been announced, certainly at least in the University of Saskatchewan.


Paul Theodore Hellyer: I am not surprised that there might have been some discussions at some places across the country, but to my knowledge no public announcement has been made.
I will certainly check, and see that an announcement is made as soon as possible.


Edmund Davie Fulton: As a further supplementary question, would the minister not think it appropriate-


Mr. Speaker:: Order, please.


An hon. Member:: You are not in your proper seat.


Paul Theodore Hellyer: May I correct an answer I gave earlier with respect to the university reserve training program. The press release did go out yesterday indicating that the program was being discontinued at the end of next year. About 1,000 students are affected, but they will complete the training for which they are enrolled. In addition the department plans to work out in co-operation with the Canadian universities the subsidization of chairs of strategic studies at several universities across the country. We feel that in this way we shall be able to make a contribution to the study of areas related to defence policy which will considerably benefit the academic world as well as the Canadian people in their discussion of defence matters.


John Alfred Irvine: A supplementary question to the minister with regard to the university training arrangements. Will an award for the first year of enrolment be forwarded to the universities concerned to cover the current year?


Paul Theodore Hellyer: There will be no enrolment this year but current students will be carried through to the end of their course at the end of the present academic season.


Hon. D. S. Harkness (Calgary North):: Having in mind the long period during which this officer training plan has been in effect in the universities and the great contribution it has made to the provision of officers for our forces, can the minister tell us why it is being abolished?


Mr. Speaker:: The question is not in order.


Lewis Mackenzie Brand: I should like to ask the Acting Minister of National Defence whether, in
DEBATES	2751
Inquiries of the Ministry view of the fact that the C.O.T.C. and the R.O.T.P are being discontinued while the U.N.T.D. is not-certainly not in Saskatoon- a statement will be made in the near future to clarify the whole matter.


Paul Theodore Hellyer: I think the hon. member will find that all the plans are being discontinued, if not at the same time then by the end of next year. Officer candidates will then, in some areas, be trained in the local reserve units.


Mr. Maclnnis (Cape Breton South):: Nonsense.


Paul Theodore Hellyer: These will be the source of trained officers for the militia and reserve units. It was felt that the original purposes of these plans were no longer being served at the present time and that the resources involved could be more effectively spent in other ways.



HIGHWAY SAFETY


[Stage Direction]
On the orders of the day:
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, I wish to direct a question to the Minister of Transport. Now that the government has had many months to study the recommendations of the conference on highway and automobile deaths and injuries, convened by the Minister of Industry some months ago, I would ask him if it is the intention of the government to implement any of its recommendations in the near future.


Paul Theodore Hellyer: Mr. Speaker, I expect that an announcement will be made by the government within a very few days.


William Heward Grafftey: If I may ask a supplementary question on that very subject, now that the United States federal government has enforced safety standards for motor vehicles is it the intention of the Canadian government to publish and enforce Canadian specifications and regulations in this regard?


Paul Theodore Hellyer: Mr. Speaker, I should hope we would be able to deal with that point in the announcement when it is made.
October 3, 1967

Inquiries of the Ministry AIR CANADA



MONTREAL-APPOINTMENT OF CONCILIATION OFFICER IN LABOUR DISPUTE

[Stage Direction]
On the orders of the day:
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, I would like to direct a question to the Minister of Labour. Has he received a request from the international association of machinists in Montreal that a conciliation officer be appointed to look into a dispute between the workers at Air Canada and the company, and has such an officer been appointed as yet?


Hon. J. R. Nicholson (Minister of Labour):: Mr. Speaker, my recollection is that I did receive such a request, but I will have to take the question as notice.



DEFENCE PRODUCTION


[Stage Direction]
On the orders of the day:
Douglas Scott Harkness: Mr. Speaker, I wish to direct a question to the Minister of Defence Production. Has the British government informed the Canadian government that the Royal Navy has found the Canadian designed and produced variable depth sonar system unsuitable for Leander class frigates, and that they are not going to purchase this equipment?


Hon. C. M. Drury (Minister of Industry):: Mr. Speaker, we have not received any such communication from the government of the United Kingdom. My department currently is trying to check the authenticity of reports to this effect which have appeared in the press.


Douglas Scott Harkness: Do I understand, Mr. Speaker, that there is definitely no official intimation from the British government that this is the case?


Charles Mills (Bud) Drury: That is what I said, Mr. Speaker.


Marcel Joseph Aimé Lambert: supplementary question, Mr. Speaker. Can the minister inform the house of the quantity of these units. Are there 25 or 50?


Mr. Speaker:: Order, please. This is detailed information which cannot be asked for at this time.


Mr. Heber E. Smith (Simcoe North):: A supplementary question, Mr. Speaker. When the 

minister answered this question his announcement seemed to carry a certain degree of authenticity. Would he tell the house whether the British are abandoning this detection device because the theory or principle is wrong, or because manufacturing costs have become so high that they cannot afford it.


Mr. Speaker:: Order, please.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Mr. L. R. Sherman (Winnipeg South):: My
question is directed to the Prime Minister. Has the foreign office of nationalist China asked the Canadian government for an explanation of the two Chinas speech which was made at the United Nations last Wednesday by the Secretary of State for External Affairs?


Lester Bowles Pearson: Not to my knowledge, Mr. Speaker. The speech made by my hon. friend last week was, in this respect, similar to the one made one year ago. If that government had wanted an explanation, undoubtedly they would have asked for it before now.


Louis Ralph (Bud) Sherman: A supplementary question, Mr. Speaker. Can the Prime Minister tell the house whether, as the result of this speech, the premier of nationalist China, C. K. Yen, is to cancel a scheduled visit to Canada?


Lester Bowles Pearson: Mr. Speaker, I understand that the cancellation of the visit of that particular gentleman has been attributed by the Chinese foreign office to the exigencies of the situation in the government of Taiwan. I am anxious, as we all are, to have a visit from a representative of that government. We still hope that will be possible.


Mr. David MacDonald (Prince):: A supplementary question, Mr. Speaker. Can the Prime Minister tell the house whether in recent days there has been any other communication from the government of Taiwan respecting self determination for that country?


Lester Bowles Pearson: Not to my knowledge. I should be glad to look into it, to see if one has come.
October 3, 1967


[Stage Direction]
On the orders of the day:
Mr. Georges C. Lachance (Lafontaine):: Mr. Speaker, may I put a question to the right hon. Prime Minister?
On his visit to Montreal last Saturday evening as the guest of his honour the mayor of Montreal, and Expo authorities, was Expo discussed and, if so, what were the results of the discussions? Does the right hon. Prime Minister intend to advise the house on the matter in the near future?


Lester Bowles Pearson: No discussions have taken place as the result of our meeting of last Saturday, since that was a social occasion when the government was happy indeed to be so wonderfully entertained by the mayor of Montreal. So far as the disposition of Expo buildings and the possible use of the Expo site after the end of Expo are concerned, these discussions are going on at the present time. I hope that before long it will be possible to make an announcement.


Hon. Theogene Ricard (Sainl-Hyacinlhe-Bagot):: Can the right hon. Prime Minister tell us whether steps have been taken to use the Expo grounds as the site of a French university?



LABOUR RELATIONS


[Stage Direction]
On the orders of the day:
David Lewis: I wish to direct a question to the Minister of Manpower and Immigration. Has he received a telegram from the chairman of the negotiating committee of the local of the international association of machinists in Toronto protesting the admission to Canada of some 15 supervisors for the firm of Consolidated Aviation Fueling of Toronto Limited, who would work in Toronto in the face of a lawful strike of the employees of the firm? If so, what steps has the minister taken?


Hon. Jean Marchand (Minister of Manpower and Immigration):: I have not yet seen
Inquiries of the Ministry any telegram, though perhaps one has been received in my office. But I have heard about this problem; I am awaiting a report, and I hope that tomorrow I shall be in a position to tell the hon. member what we are doing in this field.


Mr. Eldon M. Woolliams (Bow River):: supplementary question; maybe the Prime Minister will wish to answer it. Can the right hon. gentleman give the house any information about the position of the Woods committee report on labour and management relations, or give us any indication as to its contents? When will this report be available?


Lester Bowles Pearson: I have been pressing for a report from this important task force. I hope an interim report will be made before the end of the year, and that the work will be completed in 1968. I am expecting an interim report before the end of this year.



NORTHERN AFFAIRS


[Stage Direction]
On the orders of the day:
Hon. W. G. Dinsdale (Brandon-Souris):: have a question for the Minister of Indian Affairs and Northern Development. What action has the government taken to control the flood of cheap imitations of Eskimo carvings which has been pouring on to the Canadian market recently?


Hon. Arthur Laing (Minister of Indian Affairs and Northern Development):: We have been engaged in a study of the protective measures we can take to preserve the integrity of Eskimo carvings and Indian art work. This has progressed to a point at which a report has now been received from the man to whom we gave the contract, and I hope we shall be in a position to move in the direction indicated by the hon. member at an early date.


Walter Gilbert Dinsdale: Has the government made any representations to the enterprisers operating in this field, pointing out to them the basic importance of this industry to the Eskimo economy?


Arthur Laing: We have done that in some of the more remote areas where patterns of clothing have been copied from Eskimo designs, but for those who are heavily engaged in this practice I believe something more than exhortation is required.
October 3, 1967

Inquiries of the Ministry FINANCE



CONSIDERATION OF TAXATION REPORT BY JOINT PARLIAMENTARY COMMITTEE

[Stage Direction]
On the orders of the day:
Marcel Joseph Aimé Lambert: My question is addressed to the Minister of Finance. On Friday last I asked the Secretary of State for External Affairs, who was then leading the government, whether the government would give favourable consideration to referring the content of the Carter report and related provincial reports on taxation to the committee on finance, trade and economic affairs, or to a special Senate-House of Commons committee, for study prior to the presentation of a government white paper. Would the hon. gentleman care to comment?


Mitchell William Sharp: Since the Carter commission was appointed not by us but by the government of which the hon. gentleman was a member I feel it would be better and more in the interests of the expedition of business here if the committee to which this subject was being referred were to have before it for consideration not only the recommendations of such a commission but the recommendations of the government.


Marcel Joseph Aimé Lambert: Perhaps the minister would also consider the impact of provincial reports on related subjects, since-


Mr. Speaker:: Order. This is obviously not a question.


Mr. Colin Cameron (Nanaimo-Cowichan-The Islands):: Do I understand the minister to suggest that the committee would have before it only the government's white paper, not the report?


Mitchell William Sharp: No, Mr. Speaker. At that time the committee could have before it any documents it wished. I feel it should have before it the government's recommendations, at any rate. It will, of course, also have the Carter commission report, which is public property and which can be referred to the committee at any time.



TRANSPORT


[Stage Direction]
On the orders of the day:
Lloyd Roseville Crouse: have a question to direct to the Minister of Transport. In view of the importance of the tourist industry to the Atlantic provinces, can

the minister give us any indication of the progress being made toward establishing a second ferry service between the United States and Nova Scotia?


Paul Theodore Hellyer: I am not in a position to report on that at the moment.


Lloyd Roseville Crouse: Has a request been received by the Minister of Transport from a group in Gloucester, Mass., seeking federal assistance in connection with the establishment of a ferry terminal in Nova Scotia?


Mr. Speaker:: Order, please.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Hon. Gordon Churchill (Winnipeg South Centre):: My question is directed to the Secretary of State for External Affairs; it relates to Southern Rhodesia and to the answer the hon. gentleman gave the other day to a question by the hon. member for Okanagan-Revelstoke. Will the minister tell the house what further serious sanctions he has in mind in an attempt to cripple the economy of Southern Rhodesia?


Hon. Paul Martin (Secretary of Slate for External Affairs):: As I indicated in my reply
the other day, these are matters which, first of all, we would want to have discussed in the sanctions committee which normally meets in London. Likewise we would wish to consider them in consultation with other countries at the United Nations when this question comes before the security council.


Gordon Minto Churchill: The minister refers often to "the illegal government of Southern Rhodesia". Is he contemplating similar sanctions against other illegal governments?


[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Prime Minister. Will the report of the committee on election expenses be referred at an early date to the committee on privileges and elections? May I also ask whether the
October 3, 1967

government intends that there shall be legislation at this session on the subject of election expenses?


Lester Bowles Pearson: I would be glad to consider referring the report to the appropriate committee; 1 see no reason why that should not be done. As to the latter part of the question, I doubt whether we shall have an opportunity at this particular session to deal with this matter, but I certainly hope we shall be able to deal with it before the next election. Of course that gives us a good deal of leeway.



HOUSING


[Stage Direction]
On the orders of the day:
Mr. Raymond Langlois (Meganlic):: Mr. Speaker, I should like to put a question to the hon. Minister of Labour.
In view of the surprise and concern displayed by the various provincial ministers of finance on hearing the recent announcement that the rate of interest for housing loans would be increased up to 8J per cent, is the government considering, in the near future, to change or to alter its position and to bring about some other solution that could help and improve this situation?


Mr. Speaker:: Order. The hon member is now asking a question that might more conveniently be put in the course of the debate which is going to take place this afternoon.
[English}



NORTHERN AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Erik Nielsen (Yukon):: Mr. Speaker, may I ask the Minister of Indian Affairs and Northern Development whether talks are under way or are to be undertaken with the government of the United States with regard to the construction of new access routes through the Panhandle to tidewater.


Arthur Laing: There has been a great deal of publicity about additional means of access through the Panhandle. The unfortunate thing is that there seems to be no practical additional access as such. There are no discussions going on at the 27053-175)
Inquiries of the Ministry present time with the United States in respect of obtaining further access through the Panhandle. We have been engaged in discussions in respect of the Haines highway, and we are making a very worth while contribution in respect of those matters in which we have a particular interest at Skagway.


Frank Howard: Mr. Speaker, I have a supplementary question for the Minister of Indian Affairs and Northern Development about access through the Panhandle. I should like to ask the minister when he will be making public the report of the study group which I believe was appointed by his predecessor or perhaps by himself on the question of access through the Alaskan Panhandle.


Arthur Laing: Mr. Speaker, there was not in my time anyone appointed to make an investigation concerning the possibility of access through the Panhandle. There is a committee which was appointed by myself about four years ago in respect of northwestern transportation. This committee makes reports to the government. These reports so far have not been made public.



FORT SMITH-INQUIRY AS TO HOUSE CONSTRUCTION

[Stage Direction]
On the orders of the day:
Mr. William Skoreyko (Edmonion East):: Mr. Speaker, I have a question I should like to direct to the Minister of Indian Affairs and Northern Development. Can the minister inform this house when he expects tenders to be called for the construction of 30 houses, prefab or precut, at Fort Smith in the Northwest Territories.


Mr. Speaker:: Order. This question could be placed on the order paper.
[Translation}



ABSENCE FROM CHAMBER OF MEMBER FOR YUKON

Mr. Auguste Choqueile (Lolbiniere):: Mr. Speaker, I wish to raise a point of order under standing order 6, due to the fact that the member for Yukon (Mr. Nielsen) has been exercizing his right to speak in the last few days even though he has been away from this house for one year.
This is quite serious, Mr. Speaker, because I feel parliament becomes a huge joke if this fact is overlooked.
October 3, 1967

Inquiries of the Ministry
Standing order 5 reads as follows:
Every member is bound to attend the service of the house, unless leave of absence has been given him by the house.
Having been absent for one year, the member for Yukon has shown the same irresponsibility-


Mr. Speaker:: Order. The hon. member must know that under the standing orders, he must resume his seat when asked to do so by the Chair.


Some hon. Members:: Hear, hear.


Mr. Speaker:: I greatly doubt that the point of order now raised by the hon. member is in order. I think that the matter which he stated should rather be submitted to the house, if he wishes to do so, by way of a question of privilege.
At any rate, this is my opinion which I am expressing without having thoroughly considered the suggestion. If the hon. member wishes to leave that matter in abeyance, I could eventually give my opinion thereon.


Auguste Choquette: Now, Mr. Speaker, I respectfully submit that I will rise to-morrow I think on a question of privilege.


Mr. Speaker:: Order.


Gordon Minto Churchill: I rise on a question of privilege. When you are considering that very important point, Mr. Speaker, would you also take into consideration the matter of whether a member of this house who has sworn allegiance to the Queen should introduce a measure advocating the abolition of the monarchy and the establishment of a republic.


Some hon. Members:: Hear, hear.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. G. L. Chalierlon (Esquimali-Saanich):: Mr. Speaker, my question is directed to the Minister of National Health and Welfare. Can the minister say whether the government, since approval of the medicare bill, has received representations from any province concerning a review or reconsideration of any of the provisions of this legislation?


Hon. A. J. MacEachen (Minister of National Health and Welfare):: Mr. Speaker, I do know
[Mr. Choquette.l
that following the premiers' conference this summer there was a request to the Prime Minister to convene a conference on the subject of medicare. I will be happy to advise my hon. friend later what the present situation is in respect of that request.


George Louis Chatterton: I have a supplementary question, Mr. Speaker, addressed to the Prime Minister. Can the Prime Minister say whether the request of the provinces will be acceded to, and if so when such a conference might be called.


Lester Bowles Pearson: Mr. Speaker, I will have to look into the matter and discuss it with the minister.



TRANSPORT


[Stage Direction]
On the orders of the day:
Mr. Heath Macquarrie (Queens):: Mr. Speaker, my question is for the Minister of Public Works. Can he advise whether the energies and abilities of Colonel Edward Churchill are now being directed to the Northumberland causeway project? If so, has his department been able to make more rapid progress in the current reappraisal of the design?


Hon. G. J. Mcllrailh (Minister of Public Works):: The answer to the first part of the question is yes. The answer to the second part is that we are making very rapid progress in re-examining the design.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I wish to direct a very simple and brief question to the Minister of Veterans Affairs. Has the minister anything further to report in respect of government policy relating to an increase in disability pensions and war veterans allowances?


Hon. Roger Teillei (Minister of Veterans Affairs):: Not at this moment, Mr. Speaker.

The house resumed, from Monday, October 2, consideration of the motion of Hon. E. J. Benson (Minister of National Revenue and
October 3, 19G7

President of the Treasury Board) for committee of supply and the amendment of Mr. Chatterton (p. 2710).



HOUSING-ALLEGED FAILURE OF GOVERNMENT POLICY

Mr. J. B. Stewart (Parliamentary Secretary to Minister of Public Works):: Mr. Speaker, we have before us this afternoon a motion to the effect that the present government does not enjoy the confidence of this house.


Some hon. Members:: Hear, hear.


John B. Stewart: I see, Mr. Speaker, that I have summed up the situation reasonably accurately. The arguments put forward by hon. gentlemen opposite in support of their motion have centred around the important problem of housing. The house is being told by the opposition that the high cost of housing can be traced to high expenditures made by the government. The high cost of land for building, the high cost of developing building lots, the high cost of building materials and the high cost of labour for construction we are being told can be traced to expenditures made by the government through such things as higher pensions, assistance to education, additional payments to provinces and the like.
We are being told that the genuine top priority in the Canadian political spectrum in the last five years ought to have been housing, and that this genuine top priority has been neglected. We are being told now that more money ought to have been put into the housing field by the government, or that the government ought to have expended less money for other purposes.
At the time of the adjournment yesterday I had placed before the house figures showing the financial input into the housing field through C.M.H.C. during a span of years. The figures I placed before the house showed that this input has grown from approximately $245 million in 1962 to a budgetary estimate of $962 million in the present year. In the light of these accelerating expenditures we must assume that what the opposition is alleging is that less money ought to have been spent on other programs.
[DOT] (3:20 p.m.)
What would lend credibility to that argument of the opposition-indeed, the only thing that would lend credibility to their argument-would be if one of their spokesmen rose at this point in the debate and put
Discussion on Housing before the house a list of the major expenditures made during the past four years which the opposition now believes were mistakes. I invite one of their spokesmen to rise at the appropriate time and put before this house and the country just such a list of major expenditures. I refer to major expenditures, because clearly there would be minor expenditures about which there would be disagreement among the ranks of the opposition and perhaps even on this side of the house. We are talking about considerable sums of money here, so if their argument is to be of any importance at all it must rest upon a list of major expenditures they believe ought not to have been made.
The opposition simply cannot have it both ways. They cannot plead for increased government expenditure for various kinds of pensions, for greater assistance in the field of education, and for a better share of the Canadian tax dollar for provincial governments, and then say that these expenditures are improperly driving up the cost of housing. I invite the next spokesman or some other member of the opposition to resolve the dilemma in which their argument, as so far developed, has placed them.
The need for housing, the need for shelter, is so great that at times like this we are sometimes deluded into ignoring certain major, fundamental economic and social facts and considerations. What I want to do this afternoon is to put before you very briefly three or four of these considerations.
The first of these is that if the amount of housing land is limited and if the bulk of construction equipment and construction skill is being used, no additional amount of money poured into the housing field will produce more homes. All this money will produce will be genuine inflation.
Yesterday the hon. member for Esquimalt-Saanich quoted from the fourth annual review of the Economic Council of Canada. He referred to page 264 of that review, and I should now like to read the paragraph to which he referred because it bears directly on this point. The review states:
Of all the major sectors of the economy, none will have to grow more rapidly than housing-at least to 1970, and perhaps even throughout the 1970's. This is a matter of major national importance if a growing housing shortage is not to become a serious national problem. Greatly increased physical resources will therefore be required in this field, including a substantially enlarged working force with appropriate skills and

October 3, 1967
Discussion on Housing considerably enlarged capital and residential construction capacity. A large and sustained volume of residential mortgage financing will also be required.
You will notice that it is only in the final sentence of the paragraph that the matter of residential mortgage financing is mentioned. Clearly the economic council does not regard a large and sustained volume of residential mortgage financing as the prime consideration in producing a large number of houses such as will be necessary by 1970 and beyond. Other factors are involved, but the debate as so far presented by the members of the opposition seems to have glossed over the other factors which evidently in the view of the Economic Council are more important and probably more difficult to provide. Certainly the money to finance housing is important, but it is also very important that we face up to the problems created by scarce land, scarce skills and scarce facilities. We do not face up to these things when we simply talk about the interest rate at which approved-lender mortgages may be obtained.
The second thing that tends to evade us is the inevitability of the high cost of housing in great metropolitan areas. When I listened last night to the hon. member for Saskatoon I thought of the Carnegies and the Fricks of New York. Perhaps the hon. member did not put this in categorical terms, but he said in effect that every family had a right to a plot of land, a garden and the other nice things one thinks of when he envisages such a plot of land. I wonder how the Carnegies and the Fricks of Manhattan would have felt about that when they gave up their houses in the centre of Manhattan. I think we simply have to face up to the fact that at the core of these great metropolitan areas it is impossible to have houses surrounded by a half acre of grass or other improvements reflecting one's horticultural ambitions. This is simply a fact of economic life.
The third point we must remember is that as our national economy grows and as our society develops there may well come a point at which the cost of concentration will exceed the savings of proximity. Let me explain to you what I mean. Manufacturers, financial corporations and the other great entities which make up our economy tend to locate their businesses and head offices in great centres. One thing leads to another. To him who hath shall be given. They all crowd in. Whether this is a good thing in economic terms is a question which is often obscured. As a result there is a kind of inward momentum or inertia in the business community and

in the minds of those who determine the answers to those questions. Places like Toronto and Montreal become the places to establish head offices.
I suggest to you that the savings of proximity in transportation and communications are very real but that there may well come a time when the costs of concentration overbalance the savings of proximity.
[DOT] (3:30 p.m.)
It would be a great mistake, it would be costly to our nation, if we were to attempt vainly to redress that balance. It would be a mistake if we were to pour additional money into the provision of certain kinds of services. This would have the effect of perpetuating these 'uneconomic situations.
I speak quite frankly to you, sir. I come from a part of the country where we are not much troubled by the costs of concentration. But there are those from our part of the country who have been wondering when the time would come when the inward pull of economic factors would begin to exhaust themselves and would be overcome by what I have called the costs of concentration. There is a passage in the fourth annual review of the Economic Council of Canada which bears on this point because it shows how important it is for Canadians, above all others, to keep this consideration in mind. On page 177 of the review we are told, in a comment on a table that appears on that page, that:
It is particularly significant, however, that among this group of countries Canada experienced the highest rate of increase in urban population-4.1 per cent annually-over the period of comparison. Indeed there is evidence to suggest that Canada had the fastest rate of urban growth among the industrially advanced countries for the post-war period as a whole. This basic trend in Canada, the expected strong increase in total population up to 1980, and the relatively lower levels of urbanization thus far attained, all combine to imply a dramatically faster rate of urban growth in this country compared with most other industrial economies over the period ahead.
I suggest to you, sir, that it would be unfortunate indeed if we went into this period thinking that we simply must perpetuate the growth of these great and increasingly concentrated centres. I say it would be a mistake because we would simply be requiring people, by the structure of the economy and the society, to live in places where they would probably be less happy and no more productive than they would be if this kind of artificial concentration of population were stopped.
October 3, 1967


David Samuel Horne MacDonald: Mr. Speaker, would the hon. member permit a question?


John B. Stewart: Certainly.


David Samuel Horne MacDonald: Is the hon. member advocating, in his last few remarks, some plan whereby we prevent people from moving from one place to another within this country, and in particular prevent them from moving to some of the larger centres where employment is more readily obtained?


John B. Stewart: No, Mr. Speaker. I think the hon. member really makes the point of my comment in the last part of his question. I am suggesting that if we are going to spend hundreds of millions of dollars it would be far, far better to expend that money to base business and employment away from these focal points.


Herbert Wilfred Herridge: Hear, hear.


John B. Stewart: I am suggesting that it would be far, far better to give people jobs in places in which they could live more comfortably, without many of the problems of population concentration, rather than spending the same amount of money or even more to enable them to survive at all and have to commute 25 or 35 miles to their work and live in a very bad environment. I use the words "bad environment" with almost every connotation of the expression.
The last point I want to deal with is one to which the Minister of Finance (Mr. Sharp) himself adverted last night. It refers to the whole question of the municipal tax on homes. On April 26, 1967, when speaking to the conference of the Canadian Tax Foundation, the Minister of Finance, despite the fact that the commission had been set up by the previous government, said with approval that the Carter commission report had come to the conclusion that this tax is regressive and is bearing heavily upon the poor. I say "despite the fact that the commission had been set up by the previous government" to emphasize not that the commission report is wrong on this point, but that the Minister of Finance was quoting it on this point with great approval. The minister again referred to this problem in the house in this debate.
But, Mr. Speaker, an even more austere authority has spoken on this point. I refer again to the Economic Council of Canada. The Economic Council says at page 215 of its fourth annual review:
Examination of the historical record suggests that the financial structure of Canadian municipalities was reasonably well adapted to the requirements
Discussion on Housing of the late nineteenth century. But modernization of this nineteenth century machinery has failed to keep pace with the needs of accentuated urbanization in this century.
The review goes on to develop this point
and at page 218 we come to this sentence:
Real property taxes continued to account for more than three-quarters of the total revenue from the municipalities' own sources over the period 1953-63 and it is worth noting that they rose more than one and a half times as rapidly as personal income.
The review goes on to document the implications of the passages I have read. I would hope that when the federal-provincial conference on urban problems takes place-this conference was foreshadowed in the speech from the throne-what the Minister of Finance has said repeatedly and what the Economic Council of Canada has said on this question of taxation on homes will not be forgotten. I should think this would be one of the two or three most important topics to be discussed by the members of that conference.
We are conducting a debate on housing. The opposition raised this matter in the house last week, so I was just a little surprised that they returned to the same topic this week as a basis for their first post-reformation supply amendment. Clearly what they are trying to do is sort out their own thinking.


David Samuel Horne MacDonald: Mr. Speaker,
would the hon. member permit another question?


John B. Stewart: Yes, Mr. Speaker, if I have time.


Mr. Speaker:: I am afraid the hon. member
does not have time because his time has expired.


Some hon. Members:: Carry on.


Mr. Speaker:: Order, please. There may be agreement to allow the hon. member to continue beyond his time, but I should bring to the attention of the house that a large number of hon. members have expressed a desire to take part in the debate and only two hours and 20 minutes are left.


John B. Stewart: I shall be very brief in answering the question, Mr. Speaker.


David Samuel Horne MacDonald: My question requires a very simple answer. Does the hon. member believe there is a housing crisis in the country today? Yes or no.


John B. Stewart: There is a housing shortage. Whether one calls it a crisis depends on what

October 3, 1967
Discussion on Housing one means by the words "crisis". A philosopher has said that there is always a "present crisis". I suppose the hon. member is one of those who move from crisis to crisis.
[DOT] (3:40 p.m.)


David Orlikow: Mr. Speaker, when the Minister of Labour (Mr. Nicholson), who is in charge of Canada's housing policy, spoke last Thursday he tried to tell the house and the country that there really was no housing crisis, that there was only a problem which I suppose one could call a crisis in certain areas. In this connection he mentioned Toronto again and again, but he said that on the whole we were doing quite well. His parliamentary secretary, when speaking a few days ago, told us in great detail that it was easy to get a house in Montreal. I am certain that the Minister of Labour, his parliamentary secretary and possibly the hon. member for Antigonish-Guysborough (Mr. Stewart) are alone in Canada in really believing or in saying that there is no real crisis in housing at present.
If the Minister of Labour thinks that we are being partisan, I suggest to him and to the other members of the government that they look at what the newspapers of Canada are saying and take a close look at what the Liberal newspapers of Canada are saying. Let us take a look at the Toronto Star. I think we all know it as a very open and partisan supporter of the Liberal party and the Liberal government. In an editorial which appeared on Thursday, September 28, entitled "More Houses-But Who Can Afford Them", here is what they say about the government's policy and about the Minister of Labour. I am glad I am quoting from the editorial because I am not certain that the words used in it would be quite parliamentary. It reads as follows:
The interest rate announcement, standing alone and unrelated to the ability of ordinary people to pay, shows once again the utter incompetence of Labour Minister John R. Nicholson to handle federal housing policy.
All I can say to that is "amen."
Speaking yesterday for our party on the amendment proposed by the official opposition, my colleague, the hon. member for Vancouver-Kingsway (Mrs. Maclnnis), said that we would vote for the amendment, that we could really do nothing else. Yet I want to say to the hon. member for Esquimalt-Saanich (Mr. Chatterton) who moved the amendment that we are voting for it because

of what is in the amendment and not on the basis of the speech made by the hon. member.
I want to deal briefly with the main criticism he made of the government, one which was repeated today in questions put by the hon. member for Kamloops (Mr. Fulton) and the hon. member for Edmonton West (Mr. Lambert). The main criticism was that the reason there is a housing crisis, the reason that the interest rate on housing mortgages had to be raised as it was last week, the reason why there is no money for housing, is that government expenditures have gone up too much, and supposedly the Economic Council is the authority for this statement. I deny the suggestion that the Economic Council made that claim. However, I want to say to the members of the official opposition-and I wish the new leader of the Conservative party, Mr. Stanfield, would use his influence on the members of parliament from his party to prevail on them to be honest and consistent-that if government expenditures are responsible for the difficulties we face in housing, then one needs to look not just at federal government expenditures but at all government expenditures.
The hon. member for Antigonish-Guys-borough who has just spoken mentioned the great increase in municipal taxes. I do not want to deal with that subject today because it would take up too much time but let me say that last night I took the trouble of comparing the increases in federal government expenditures with the increases in provincial government expenditures. I found the figures very interesting and I commend them for study to the members of the official opposition.
In 1958 the government of Canada spent $5.17 billion. Ten years later the estimates of the federal government for 1967-68 show that we are spending $9.5 billion, an increase of just under 100 per cent. In 1957 the province of Nova Scotia, under the premiership of the present leader of the Conservative party, had a budget of $58.5 million. In the year 1967 their budget was $154 million, an increase of almost 300 per cent. I am not being critical of that; I know how much Nova Scotia needs to improve its roads, schools and hospitals. However, I suggest to the members of the opposition that if it is necessary for the federal government to economize so that we can have houses, Nova Scotia should also have to economize.
October 3, 1967


John B. Stewart: May I ask the hon. member a question? Does the hon. gentleman know whether in the increase in federal expenditures which he has just called to our attention the transfer payments made by the federal government to the provinces are included?


David Orlikow: Of course they are included, and Nova Scotia received a substantial amount. I do not want to spend all my time on this subject; I just want to try to bring some sense of reality to the members of the official opposition. The province of Ontario, which has had a Conservative government for 25 years, spent in 1958 just over $1 billion. In the last year-this was before Mr. Robarts started to campaign and make a promise every day, promises which are going to cost hundreds of millions of dollars-the province of Ontario spent $2,193 billion, an increase substantially greater than 100 per cent.
I wish to commend the province of Manitoba to the members of the official opposition. That province, which has had as its premier Mr. Roblin who, according to the week end Globe and Mail, is the shadow finance minister of the official opposition, had expenditures in 1957-58, the year in which Mr. Roblin took office, amounting to $80 million. For the year 1967-68 expenditures in the province of Manitoba amount to $354 million, an increase, according to my rough calculations, of 450 per cent.
I do not blame Mr. Roblin for the expenditures in some of those years. I was a member of the legislature of Manitoba for part of that period and I urged Mr. Roblin to spend even more money. However, I am suggesting to the members of the official opposition that if they are going to assume the new kind of image about which the press is talking so much, if they are going to offer a constructive alternative to the government, they have to be consistent. They cannot call on the federal government to be careful to cut down expenditures and cut back programs while at the same time Conservative provincial governments are expanding their services. If the members of the official opposition are talking, as they were today in the question period, about programs which should be cut back, I think they will have a responsibility this coming week when we are discussing the budget to tell us what programs they think should be cut back.
Discussion on Housing [DOT] (3:50 p.m.)
Should we stop the subsidy on the price of wheat to be paid to farmers, a subsidy which the government announced last week? I would like to hear from the Conservative members from western Canada. Do they think that subsidy should be stopped because the government is spending too much money?
I would like to hear from the members from Cape Breton. Should we stop the subsidies paid to help the coal mines keep operating and to help keep the coal miners at work? I would like to hear from those members on that score.
I remember the hon. member for Bow River (Mr. Woolliams) and the hon. member for Macleod (Mr. Kindt) in past months asking the Minister of Transport about the subsidizing of coal being shipped by rail from the Alberta mines to Vancouver so that it can be sold to Japan. Do they want the government of Canada to stop subsidizing the shipment of that coal? If they do, let us hear about it.
Do the hon. members from Halifax and the hon. member for Esquimalt-Saanich want to cut a billion dollars or half a billion dollars from the defence estimates? I think we should be told this by them because if we do that people working for the navy at Halifax and Victoria would be thrown out of work. Let us hear from these members. Let us see how serious they are about this business of cutting expenditures.


Mr. Forrestall:: What would you do about it?


David Orlikow: I do not think the difficulties in housing are caused by too much government expenditure. I say that you people in the official opposition have a responsibility to spell out what you mean, if you really mean what you have been talking about for the last few days.
Now I want to deal with the kind of thing which the Minister of Labour was saying last week and the kind of thing which the Minister of Finance (Mr. Sharp) was saying last night, that there is really no housing shortage in this country, no housing crisis except in Toronto. Mr. Speaker, the ministers know that is not true.
I have here three stories which appeared in Winnipeg newspapers during the last few months. One deals with the city of Winnipeg and appeared in the Winnipeg Free Press on March 14, 1967. It summarizes a study made of housing conditions in the central part of

October 3. 1967
Discussion on Housing Winnipeg, an area represented by my colleague, the hon. member for Winnipeg North Centre (Mr. Knowles). I want to quote a couple of paragraphs:
Half the families living in greater Winnipeg, are living in houses or apartments that are overcrowded, or substandard from the point of view of construction or sanitation.
Or else they are living doubled up-two families in a dwelling designed to be used by one family; or they are paying more for their shelter than they can afford.
It goes on to say:
There are only 2,000 dwellings in the city designed to satisfy the needs of the 35,000 Winnipeg families (about a third of the total number of families in the area) whose income is so low that they need some form of direct subsidy to be able to live in decent homes.
The Winnipeg Tribune in June, 1967, carried a report about the town of Thompson which is the centre of a large nickel development. Last week my colleague from Sudbury spoke about the problems in Sudbury. In Thompson the International Nickel Company has announced its intention to double its work force over the next few years from the present 3,000 to 6,000. At present there are workers in Thompson who are paying $150 a month for one room and their families are still living in Vancouver, Edmonton or Sudbury whence the men came to find work. What is the future for those families? What is the future of that town? The minister has announced a policy covering an increase in mortgage rates which will effectively prevent these people from ever being able to buy homes.
The Winnipeg Tribune in March, 1967, carried an article which dealt with the problem of some of the rural people, particularly the problem of the Metis, and I would like to quote one paragraph:
In the community of Ebb and Flow on the west side of Lake Winnipegosis live 329 persons. They live in 52 log and mud dwellings, most of them with one or two rooms. Several families with 7 to 10 children live in one room. Other families with 9 to 13 children share two rooms.
I could go on and on, Mr. Speaker, but I think hon. members and the public in general know the conditions under which our Indian and Metis people are living. Yet last week the Minister of Labour and last night other members of the government tried to brush aside this problem and to suggest that there is no problem. Mr. Speaker, there is a problem. It is a problem which must be met. It is a problem which must be dealt with.

If there is one thing the government has demonstrated it is that it simply has not got the ability to deal with this question. I think the Minister of Finance put the government's housing policy so clearly in one sentence that nobody, even members of the official opposition, could misunderstand what it is. I want to quote that sentence because it clearly gives the principle under which the government is working. Hon. members will find it at page 2734 of yesterday's Hansard, where the Minister of Finance is recorded as follows:
We plan that the bulk of housing should continue to be financed through the market, as It has been in the past.
What does that mean, Mr. Speaker? It simply means that people who want to find housing accommodation, whether it be individual houses which they will buy or apartments which they will rent, will have to depend on the market. They will have to depend on builders and contractors getting money from the lending agencies.
For some years a situation has existed in which there is a tremendous demand for construction. There is a demand for houses, individual homes. There is a demand for apartment dwellings. There is a demand for building motels and hotels. There is a demand for building modern, luxurious, air-conditioned office buildings. There is a demand for building grocery supermarkets. It is a tragedy if one cannot drive within three minutes to a supermarket, and so it is necessary to build another one three blocks away. There is a demand for filling stations and service stations on every other city block, if not on every block.
Is there any member of the house, any member of the business community, who does not realize that under these conditions, when we obviously cannot meet all of the demands, housing simply cannot compete for money with business and industry which do not care about costs? I say in all seriousness to the hon. member for Halifax (Mr. Forrestall), who asked what our solution was, that if we are going to build housing accommodation, whether it be individual homes owner-occupied or rental accommodation, in anything like the number of units we need we are not going to be able to do so until the government of Canada, in co-operation with the provinces, is prepared to establish a system of priorities.
I give one very simple example from the city of Ottawa; at least, it is simple to me. Completed during the past few weeks in the
October 3, 1367



city of Ottawa was a very impressive, very luxurious hotel just a couple of blocks from here, the Skyline Hotel. I am not an expert on building but I am satisfied that the money it cost to build the Skyline Hotel, if it had been used to build houses, could have provided at least 1,500 houses in Ottawa. I say to the minister and to all hon. members that that is the kind of choice we shall have to make if we really want to have houses. Do we need a hotel more than we need 1,500 homes? My answer is very simple. I think we need the houses much more than we need the hotel and I believe that the government, in co-operation with the provincial governments, in co-operation with the lending agencies and working with the Bank of Canada, should be saying this to the construction industry.
[DOT] (4:00 p.m.)
We should be setting priorities. Until we do so it is just nonsense to think we are going to meet the housing needs and build anywhere near the number of houses required. Up until this year we have followed a simple policy in regard to housing, a policy which one of the people who administer a public housing project in the city of Toronto some years ago called a policy of socialism for the rich and free enterprise for the poor. We have used legislation and government guarantees to assure lending agencies that those in the middle and upper income brackets who borrow money on mortgages are safe risks. The government guaranteed the mortgage companies that they would not lose money. For the low income people, for those with large families, we have done virtually nothing. There are about 50,000 public housing units in Canada and there ought to be 500,000 or more. By raising the interest rate to 8 J per cent the minister in effect says, "We will not help to finance houses for those with middle incomes."
In Toronto a man must earn over $8,000 a year to qualify for a mortgage loan under the present government regulations. In Winnipeg, the city from which I come, that figure is $6,500. The Minister of Labour ought to know that most workers in Winnipeg do not make $6,500. The minister has frozen out the bulk of the Canadian people.
Even if we build the 170,000 houses which the Economic Council has said we need-and I submit that we will not-even if we build in the next couple of years the 190,000 houses a year which will be needed, we shall be building for precisely those who need assistance least. We shall be building for those who can manage best on their own. That is the
Discussion on Housing effect of the minister's action. The hon. member for Antigonish-Guysborough who spoke before me quoted something from the Bible which ought to be applied to this government and its housing policy-to those who have, shall be given. That is precisely this government's housing policy.
To solve the housing crisis the government should adopt a system of priorities. It should tell the builders and speculators that we can do without some luxury hotels and without the constant proliferation of supermarkets, that the materials and manpower for such projects which have been projected for the next two years can better be used in building housing. That is what the government should say.
If the minister will not listen to that kind of drastic proposal-I am sure he will not because he is a great admirer of the free enterprise market system which he thinks will solve the housing problem-he should listen at least to the proposals of the Toronto Star. That newspaper proposes that the government should absorb about 3 per cent of the interest rate charged against mortgages. It says that if the government were to pump $300 million extra into housing the subsidy would amount to just about $9 million a year. I suggest to the official opposition, which was concerned about government expenditure, and I suggest to the Minister of Labour that the $9 million would be well spent. It would help to provide houses for hundreds of thousands of those who are not in the low income bracket and do not need public housing or subsidized housing but could afford their own houses if the stupid policies which this government has permitted to grow were done away with. In an editorial last Friday the Toronto Star said: "We subsidize coal-why not housing?" The minister ought to explain why the government of Canada or the people of Canada cannot afford to subsidize housing, one of the basic needs of our people.
I said I would mention some policies which we think ought to be adopted.


J. Michael Forrestall: The hon. member needs some ideas on the subject.


David Orlikow: In the light of the contributions of the official opposition in the last two days I think it would be best for the hon. member for Halifax not to interject such remarks. I submit that the official opposition have already demonstrated sufficiently their ignorance and stupidity.

October 3, 1967
Discussion on Housing
I want to deal in broad outline with what we think government housing policy ought to be. We do not think that the federal government can evade its responsibilities in the field of housing. It cannot suggest that housing is outside federal jurisdiction. It is true that the constitution says that housing is a responsibility of the provinces and municipalities, but surely no one can deny, that the federal government, through Central Mortgage and Housing Corporation, has pumped into housing hundreds of millions of dollars. Without the federal government there would be no leadership in this field, there would be no housing policy and virtually no house construction in this country. It is the federal government, therefore, that must give leadership, and there are a number of things which the federal government can do.
If the government does not wish to impose direct capital controls on the construction industry-and I cannot see this dreadful government doing that-at least it could bring in a program similar to the winter works program under which $500 was allowed to those who built houses in the winter when unemployment usually is high. Such a program could be extended to moderately priced houses. Also, Mr. Speaker, the government could take the sales tax off building materials used in home building. That should be done immediately. If necessary the Minister of Finance could think of increasing the sales tax on materials used in projects such as hotels, motels and shopping centres. We could well do with a pause in that kind of building. If the government would do this the building of houses would be encouraged, particularly the building of moderately priced homes.
I submit that Central Mortgage and Housing Corporation ought to tell builders that mortgages will not be guaranteed where the cost of the lot exceeds a reasonable amount. That would stop the value of lots being bid up to as much as $10,000 to $12,000 in cities such as Toronto and Montreal. Also, provinces and municipalities should stop selling raw, unserviced land to speculators who develop land which they have bought for several hundreds of dollars an acre and sell it for several thousand dollars per acre. The provinces and municipalities themselves should develop the land and sell it to builders at a reasonable price. I submit that in this way Central Mortgage and Housing Corporation could use its money and authority effectively. The adoption of such proposals, 
we submit, would lead to a solution of the housing problem which has become of crisis proportions.
[DOT] (4:10 p.m.)
Before I sit down I wish to pose a couple of questions to the Minister of Labour arising out of remarks made yesterday by his colleague the Minister of Finance. The Minister of Finance said that the government intended to see that Central Mortgage and Housing Corporation placed greater emphasis on projects involving public housing and subsidized housing for elderly people, students, and so on. I should like the hon. gentleman to tell us what he believes the coming year will produce in the way of housing. Is it likely to be the 170,000 units which the Economic Council says we need, or 150,000 or 135,000? It has to be one figure or another. What percentage of this housing will be the kind of housing which the Minister of Finance said last night we needed most? He said-and I agree with him in this-that our need was not confined to the kind of houses which were being built across this country for $40,000 or $50,000. What is the percentage in the public sector likely to be? In 1966 it was 4 per cent. Will it be 6 per cent or 10 per cent next year? If the Minister of Finance was speaking seriously the Minister of Labour, who is in charge of housing, must surely know what are the government's intentions for the coming year.
We on this side hope the minister has a better answer to the housing problem than he has given us so far. We hope his contribution to its solution will be more constructive than his announcement last week that the interest rate would be increased to 8J per cent, a rate which 85 per cent of our people, I would estimate, cannot afford to pay. Incidentally, the minister knows that the real rate on commercial loans for housing is not the figure fixed by C.M.H.C. but a higher rate in the neighbourhood of 8f or 9 per cent and that as a result of the greater cost of housing most people will need second mortgages in order to complete their purchases. The rate of interest on second mortgages is 10, 12 or even 15 per cent for people who are good risks. I am afraid to mention the figure which people who are not considered to be good risks are required to pay.
These are some of the problems facing the people of Canada today in the field of housing. I am not talking about those who can afford to pay whatever is required of them. I am not talking about people who can afford to rent apartments for $250 or $350 a month
October 3, 1967

or pay $50,000 for a new house. I am thinking of those who are making between $5,000 and $6,000 a year and for whom the cost of housing is becoming so great that they cannot afford to maintain even the minimum standards which any civilized country ought to be providing.


Hon. Martial Asselin (Charlevoix):: October 3, 1967
Discussion on Housing has thus averaged only about 4 per cent per year, compared with a rate of growth in real Gross National Product well in excess of 6 per cent. This has meant that at a time when the number of new households being formed was rising sharply, the share of total available resources being devoted to the provision of new housing was significantly smaller than in the early 1960's.
Here we have the summary of the precarious situation as far as housing is concerned. According to the annual review this situation became apparent at the beginning of 1966. That is why last year we have repeatedly asked the government to adopt measures and pass legislation likely to put a stop to the situation with which we are faced today.
But, unfortunately, and I emphasize this again, we have a government which waits until a situation deteriorates before it takes positive action.
Of course, Mr. Speaker, there are causes to the present unrest, and those which were put forward during this debate, are the tightening of credit and a complete lack of planning on the part of the government with regard to expenditures.
The review by the Economic Council of Canada is perfectly clear and specific on those two points. And with your permission, I shall refer to page 25 of the economic review with regard to the tightening of credit:
In summary, during periods of tight credit conditions, the supply of and demand for residential mortgages are both subject to considerable pressure. Housing demand, as a result, has tended to contract during periods of strongly rising economic activity and during periods of deliberate monetary restraint, serving to stabilize the overall level of demand in the economy, but at the expense of producing a great deal of instability in the housing sector itself.
Since the 1965 elections, the government has applied a policy of tight money. And that tight money policy has had disastrous consequences, not only in that sector of our economy but also in other sectors of consumer affairs.
That is why, naturally, people without means, the poor, are now having a hard time making ends meet.
Mr. Speaker, planning expenditures, that is one of the main objectives of good administration. A while ago, we heard the member for Winnipeg North (Mr. Orlikow) claim that the Conservative party was not consistent in introducing this amendment, because last year it did not ask the government to limit its expenditures.
Now, as far back as 1965 and even before that, we have continuously been asking the

government to plan its administrative expenses.
Of course, we have always been in favour of some co-ordination of priorities. When mention was made this afternoon that we were supporting the proposed increase in the old age pension to $105, that was precisely because we wanted the government to establish priorities in various fields. We were convinced at that time, that the increase in the old age pension was a priority, and I am sure that our well-informed friends opposite also shared our belief in this respect.
[DOT] (4:30 p.m.)
We are therefore in favour of planning our expenditures and establishing priorities for certain policies.
In his statement yesterday, the Minister of Finance (Mr. Sharp) implied that he would propose, on behalf of the government, to establish priorities shortly. Well, that is what we want and in 1967, if the economy is to be well understood and the national interest served, it will be necessary in our modem times to give priority to certain pieces of legislation.
In the matter of housing, Mr. Speaker, I feel that priorities should be established. The first that comes to my mind is the setting of a reasonable rate of interest for people in the middle income bracket.
Figures have been quoted in this house, showing the continued escalation of mortgage financing and construction costs.
Yesterday, I was shocked by the figures given by the hon. member for Red Deer (Mr. Thompson). I refer to page 2719 of Hansard where he told us that with a $15,000 mortgage at 8:j per cent for 35 years, the cost of the house will be $45,000 principal and interest.
I think, Mr. Speaker, that when we pass legislation or report on our policies, it must be done efficiently.
Obviously, we cannot say that increasing the interest rate to 8j per cent will be an incentive to housing construction in Canada. This may promote competition and encourage financial institutions to increase their investments in this particular sector of our economy. However, for poor people, those who cannot afford it, those who earn less than $5,000 or $6,000 a year, for instance, this 8J per cent rate of interest is totally unacceptable, it is absolutely detrimental to their interests.
I fail to see how the minister's decision to raise the interest to 8J per cent could help
October 3, 1967

the poorer classes to own their homes. I think that in 1967, a house is not a luxury, but a necessity. In my estimation any red-blooded, ambitious and resourceful Canadian can and should aspire to become a home owner or to live in a decent salubrious dwelling that meets the needs of a modern family.
I shall quote here what a Liberal member said yesterday: We are happy that the increased interest rate of 8J per cent represents a ceiling and that the minister foresees that financial institutions will provide loans at a lower rate.
To strengthen his argument, evidently, he said that the Bank of Montreal was ready on Friday last to supply loans at the rate of 7} per cent. That 7J per cent was last Friday, but did things stop there?
Mr. Speaker, the Ottawa Journal reports today that both the Royal Bank of Canada and the Toronto-Dominion Bank have decided to charge 8 per cent interest on loans.
Now, following the 7J per cent interest which the Bank of Montreal set last Friday, two other branches of the bank have decided to raise their interest to 8 per cent. And next week, we would not be surprised if our banking and financial institutions would reach the maximum rate-and thus I think that the minister will be unable to attain the goal which he had set when he announced his interest rate of 8i per cent.
The second priority, Mr. Speaker, in the housing field, is evidently the elimination of the 11 per cent tax on building materials. Yesterday, the Minister of Finance, in his statement in the House of Commons suggested that the 11 per cent tax was necessary to meet government expenses. He quoted figures alleging that the 11 per cent tax only applied to half of the cost of construction.
Well, Mr. Speaker, if the minister was sincere last night when he said that he was looking for means and reasons that would justify dropping the 11 per cent tax, I feel that he could have turned to other fields of taxation, such as the luxury field. For example, why not levy a heavier tax on colour television sets and on tobacco and chocolate, which are not essential to the taxpayers? No, instead of taxing luxury goods, the minister is hitting one area of our economy and he is sabotaging the whole system of taxation.
The minister knows very well that the 11 per cent tax which he has refused to abolish for two years has greatly helped to raise the level of unemployment in our province. If people cannot afford to pay 8| per cent, they
Discussion on Housing certainly cannot afford to pay 11 per cent tax on building materials. That is why, in the last few months, our manufacturing and building industries have declined and the level of unemployment is rising, not only in Quebec but across the whole country.
Therefore, Mr. Speaker, I urge the Minister of Finance, if he is really sincere, to review again, not only for himself but for the benefit of all the Canadian taxpayers, this policy of the 11 per cent tax on building materials.
In this, he should, I believe, follow the idea and thoughts expressed repeatedly by the official opposition, that is, he should, in the interest of this economic sector, do away with this 11 per cent tax as soon as possible. I believe that as far as housing is concerned, that is a second priority matter.
The third priority in housing, sir, is for the government to establish a research committee of experts to find out if it would be possible to reduce the building cost of our properties.
We can hardly build a decent house now, unless we pay $12,000, and here again, I think that a $12,000 property would only have four rooms. Obviously, in this $12,000 house, you cannot have the commodities of a more luxurious one. But I feel that the building cost of our houses, when you think of our climate, is excessive and absolutely prohibitive.
I would therefore suggest that the minister acknowledge the third priority: the establishment of a research committee of experts to find out if it would not be possible to lower the building rate of our properties.
[DOT] (4:40 p.m.)
Fourth on the list of priorities, Mr. Speaker, the hon. Minister of Labour should immediately convene a federal-provincial conference on the housing crisis in the nearest future.
The hon. minister told us in his speech that he travelled across Canada and met representatives of the provinces and of municipalities in an attempt to stimulate house building throughout the country. With respect to this most urgent and serious problem, I think that the hon. minister should immediately call a federal-provincial conference to consider the steps that can be taken in order to reduce the purchasing cost of lots. Since this matter comes under municipal jurisdiction, and municipalities come under provincial jurisdiction, this matter should be discussed with provincial authorities.

October 3, 1967
Discussion on Housing
At this federal-provincial conference, we should find the means to facilitate urban renewal. Obviously, this is an extremely difficult question in 1967. Naturally, housing is very, very heavily taxed locally, municipal and school taxes are excessively high not only in the province of Ontario but also in the province of Quebec. I believe that the average of municipal and school taxes in Quebec is between $325 and $350 per property.
This federal-provincial conference should also provide through the Central Housing and Mortgage Corporation increased amounts to provincial and municipal governments so as to give this area a necessary blood transfusion if the crisis is to be thoroughly and efficiently contained.
Mr. Speaker, it was several times that the present government should show more leadership, more decision in some areas. Naturally, we will be told that this area is not under jurisdiction of the federal government but in view of the fact that the Central Housing and Mortgage Corporation has for several years spent millions for the construction of residential housing, I think it would be fair and reasonable that the hon. minister be given an opportunity to exert his leadership and bring the parties involved together to consider most seriously the whole question at a federal-provincial conference.
During the debate, the minister, replying to the hon. member for Northumberland (Mr. Hees), I think, said that our chartered banks, having been granted new powers by the legislation adopted last year, are indicating some interest in making mortgage loans. The minister quoted figures. The minister said that according to his information chartered banks were lending nearly 10 million dollars a month. But I do not know who is getting these loans nor what banks are granting them. Possibly, they are being made in the major urban centers? But as far as we the rural folks are concerned, I must tell the hon. minister that several times during the summer people came to ask me how this new Bank Act could be used to secure mortgage loans. In all the cases of which I was told about, none of the people has obtained a loan from a chartered bank. Now I speak of the rural environment in which I live. The statistics quoted by the minister possibly referred to urban areas.
But I must tell the minister that in rural areas the banks, thanks to new powers granted them last year, that is the authorization to
[Mr. Asselin (Charlevoix) .1
make mortgage loans, refuse to give explanations and refuse also to grant mortgage loans.
I would therefore urge the minister to bring pressure to bear on our financial institutions, on banks, not only in large cities or in urban areas but also in rural areas, so that they may, under the new powers we granted them, meet the requirements of consumers.
Of course, it is more profitable for the banks to lend on notes. In view of the fact that they availed themselves of their privileges and were given the right to develop, to administer themselves financially, I think that the government should threaten to impose sanctions on the chartered banks and those who will not lend on mortgages.
The province of Quebec, Mr. Speaker, is of course faced with that problem just like the other provinces. That explains why the Quebec government set up what is called the Quebec Housing Corporation, thanks to an act passed in 1967. In addition to dealing with urban renewal and low-rent housing, it has a five-year plan to develop the two sectors I mentioned.
This work is performed in co-operation with municipalities and private companies. Moreover, the province of Quebec, through that housing corporation, borrows funds from the Central Mortgage and Housing Corporation in order to attain those purposes. I am advised that in accordance with the five-year plan of the Quebec Housing Corporation an amount of $100 million is provided for urban renewal and $300 million for the construction of low-cost housing.
But, Mr. Speaker, is it necessary for me to tell you that those are minimum amounts. In fact, Quebec is dealing with an unusual problem of slums; it has been mentioned in this house that Montreal, the metropolitan city of Canada, had taken advantage of only one comprehensive plan for low-cost housing since the Quebec minister of finance, Mr. Dozois, had developed such a plan. It has been called the Dozois plan in Montreal.
What I find most strange, is the fact that we are trying at the present time, to rack our brains, in order to decide what should be done with the site of the world fair. If we have spent millions of dollars in an effort to spread abroad our Canadian culture, I do think that this administration, that of the city of Montreal and the Quebec government should consider the fact that the site of the world fair would lend itself splendidly to the
October 3, 1967

construction of low-cost housing for our people, our poor in Montreal who need them so badly.
In fact, I have been told that, in one portion alone of the site of the world fair, we could house 30,000 families. Let us think about it, Mr. Speaker, 30,000 families.
In my opinion, Mr. Speaker, if we carried out that project, it would be one of the most outstanding gestures of human brotherhood on the part of the Canadian people towards the underprivileged classes of our society, and I urge the minister-this is my suggestion to him-when discussions about the possible use of the world fair site take place, to make that suggestion to the Montreal municipal authorities and those of the Quebec government. In so doing, I am convinced that we would make a worthwhile contribution to a group of our people who need it very badly. Of course, the minister said yesterday that the present government found it difficult to borrow. The same applies to provincial governments.
The Quebec minister of finance told us recently that the borrowing index of the province and that personal and corporate income taxes evidenced that other sources of revenue had to be found. Since Quebec, as well as the other Canadian provinces, desperately need money to set up the various building programs for low-rent housing projects, it is high time, as I said earlier, that the minister convened a federal-provincial conference in order to discuss and solve that problem without delay.
Mr. Speaker, this evening we will be asked to vote on an amendment. All the members are acquainted with the amendment of our party because, to my mind, it is quite clear. We were told yesterday, and it was confirmed this afternoon, that the New Democratic Party would support the amendment. We thank them for their support. We hope that the other parties in the house as well as a few Liberal members-although I doubt it -will also support our amendment. We do not want to twist the knife, nor do we want to challenge the minister. He is an extremely likable fellow, but the government, and cabinet have swamped him with problems in the last two years.
He had some last year with the longshoremen's strike in Montreal; this year, we have to face another crucial matter, housing. Now, through this amendment, we simply want the government to think about it. We are asking the government not to wait until a situation
Discussion on Housing deteriorates before it acts. We are asking the government whether it plans to govern. To govern is to foresee. We are asking the government to foresee difficult situations in the future. Then, even if our amendment is defeated tonight, it will have awakened Canadians to an increasingly important problem and will be of great help to the government.
[DOT] (4:50 p.m.)


John Robert (Jack) Nicholson: Mr. Speaker, when the estimates of Central Housing and Mortgage Corporation were before the committee of supply last week I stated that I would welcome suggestions and constructive criticisms from members of the house. I think my words were to the effect that if one is not prepared to take criticism, even criticism that may not always be constructive, one should not be in politics. After only five years in this environment I think I can state that with all sincerity. However, I did and do welcome suggestions and I do and have welcomed criticism of the proposals that we have put forward. I will try to deal with the suggestions and the criticism later in my remarks. However, I do intend to pursue the contributions that individual members of the house have made in the course of this debate and I will deal with their remarks in the order in which they have been made.
The hon. member for Esquimalt-Saanich (Mr. Chatterton), who proposed the amendment on which we will be voting in a matter of a few hours, first referred to the housing requirements in the part of Canada which he knows best. None of us would be human if, believing that some special problems exist that affect our particular riding or the part of the country in which we live and in which we have a special interest, we did not concern ourselves with such problems. However, I wish to say that I do have some detailed knowledge of the housing problems of the city of Victoria and environs and I do know that the greatest need in that particular part of British Columbia is for housing for elderly citizens, for public housing and-yes, a remarkable trend during recent years-a growing need for apartment houses.
That special need, the need for apartment houses, leads me to some of the references which the hon. member for Esquimalt-Saanich made to the report of the Economic Council of Canada. A number of references have been made to that report, including the fact that I was critical of it. If my remarks

October 3, 1967
Discussion on Housing on Thursday were construed as criticism, let me say that I criticized only one particular aspect of the report. I recognize that a tremendous amount of work has gone into the preparation of this report. It is welcome, but I do say that in my opinion the role of the council is not only to study but to make suggestions and if I have a criticism it is that while certain statements are made in the report, suggestions as to corrective measures are not contained therein.
There are some passages in the report to which I would like to refer because I think they should be stressed at this particular time. They are to be found on the pages mentioned by	the hon.	member for
Esquimalt-Saanich, but the complete exerpt has not been read to the house. On page 24 of the report we find the following words in the middle of the second paragraph:
Given the nature of the capital markets-their structure, institutions, and responses-tightening credit-
Not tight money.
-typically tends to fall with an uneven impact across the spectrum of demand, bearing especially heavily on the housing sector. Housing thus, in effect, becomes an "economic regulator" which acts to offset excesses in demand elsewhere in the system.
This pattern of behaviour may be traced to the effects of institutional arrangements in the residential mortgage market, on the one side, and to the relative sensitiveness of the demand for house mortgages to the level of interest rates on the other. A substantial proportion of house purchases in Canada since 1954 has been made under the insured loan arrangements established by the National Housing Act.
Until recently, the maximum interest rate on newly issued N.H.A. mortgages was set by the government at irregular intervals. When this rate was at a clearly preferential level in relation to the rates on competing debt instruments (e.g., the bonds offered by business corporations to finance their activities) N.H.A. mortgages became attractive to institutional investors as an outlet for their funds. This tended to be so when, in a period of emerging economic slack, corporate bond and other debt offerings fell off, in relation to the demand for them, producing a firming of their prices and a corresponding decline in their yields. Alternatively, when other interest rates were rising, N.H.A. mortgages became relatively less attractive to institutional lenders and the supply of mortgage funds under the provisions of the National Housing Act was accordingly reduced. In early 1967, the method of adjusting the N.H.A. rate was altered.
There is another passage in the report to which I would like to refer. Reference has already been made to it. It relates directly to the remarks made by any friend, the hon.
[Mr. Nicholson.)
member for Esquimalt-Saanich, and the passage is very significant. It appears on page 135 of the report and reads as follows:
Of the 200,000 starts projected for 1970, it is estimated that about 80,000 units would represent single detached dwellings, and 120,000 units would be apartments, town houses, and other types of multiple accommodation.
As I have said more than once, therein lies the difficulty. The fact sticks out that 120,000 units, 60 per cent of our total need for housing only four years from now, will be in the nature of apartment or row houses. Naturally this need creates a need for a special type of financing. As has been stated, the government had a responsibility to settle and has established certain priorities. Having regard to the change in the nature of our housing requirements and to the changing conditions that are taking place in Canada, I say that we have established priorities and we are getting encouraging results from them.
[DOT] (5:00 p.m.)
A reference to the figures will bear this out. I have picked certain years at random. In 1960 the total investment by the federal government, in the form of loans and direct investment in public housing for low income people, elderly persons, student housing, sewage treatment facilities and urban renewal, was $38.6 million, $33 million on the housing side and $5.6 million on the urban renewal side. Now take 1964, the year in which major amendments to the National Housing Act were made. A total of just over $100 million was invested, $87 million in public housing, student housing, etc., and $13.1 million on the urban renewal side. In 1966, within two years of the amendments to the act, the expenditures in these fields of greatest social need reached $201 million, $185 million on the housing side and $16.1 million on the urban renewal side which, of course, is closely associated with housing and improvement in living standards.
In 1967, with only three-quarters of the year behind us, this figure which was less than $40 million seven years ago has reached the astounding level of $400 million in the areas of greatest social need, with $355 million earmarked for housing and $45.5 million on the urban renewal side. As I think I mentioned last Thursday, Mr. Speaker, $300 million of that $400 million has already been committed, with three months of the year still to come.
This is a field in which all levels of government, but more particularly the federal government, have special responsibilities to assist
October 3, 1967



those with the greatest social need. As I have pointed out, our investment has risen from less than $40 million to more than $400 million per annum in a period of six years. My confident expectation is that next year the figure will be at least 50 per cent higher and perhaps even more.
If we are to take care of the need of people for whom the federal government has this special responsibility, should we not assign a priority in allocating funds available for housing purposes to the area of greatest social need? That is the first priority that we have established and that is the course we have followed, at least during the three and a half years that I have been the minister in charge of housing activities. Last year when the demand was not so great in the social need field, partly because the interest of the provinces and municipalities had not yet been generated, in proprotion more money was available and was provided in the form of direct loans for housing as distinct from providing funds to the area to which I have just referred in which we have special responsibility.
The second priority that the government has assigned in the housing field is direct loans by C.M.H.C. to those people who wish to build their own homes, not to the builders of apartment blocks, luxury hotels and the other buildings referred to by the hon. member for Winnipeg North (Mr. Orlikow) but to people who want to build their own homes. I want to say to the house that in the three and a half years that I have been minister no person who wanted a direct loan to build his own home and was a reasonably good credit risk-and may I say that the tests are reasonable-has been refused a loan.
There is another priority that has been assigned. In addition we say, and I think quite properly, that when housing is to be built for profit, such as apartment blocks, and when, as pointed out by the Economic Council report, there is a shortage of money, only under very special circumstances, such as in a resource town where there is a need for multiple dwellings, should or will the federal government provide funds. This is something we are doing in British Columbia, Alberta, Manitoba, Ontario, Quebec and in the maritimes. We have taken care of the housing needs of our resource communities not just in the field of private homes but in the field of multiple dwellings of the apartment block or row housing nature.
During the debate on the amendments to the National Housing Act in 1964 members of
Discussion on Housing all parties stressed the need of an educational program explaining the provisions and purposes of the act. We embarked on such a program in late 1964 and continued it into 1965. Housing conferences or symposia, a word the hon. member for Brome-Missisquoi has difficulty in accepting even though it is well accepted and known in the international conference field, were held across the whole country in late 1964, 1965 and again in 1967. The whole purpose of these meetings was education, to pass on information that was lacking.
1 met with representatives of municipalities in every province. I met spokesmen even from provincial governments who did not know the possibilities inherent in the new federal legislation. Yesterday the hon. member for Vancouver-Kingsway (Mrs. Maclnnis) referred to some of the housing problems in the city of Vancouver. I know something about those problems. I think perhaps that I have been closer to them than any other member of the house. I know that in late January of this year, at the housing conference held in the Hotel Vancouver, member after member of the provincial legislature, including members of her party, the N.D.P., got up and said, "We did not know this. The responsibility does not lie with the federal government. The course has been opened up by this legislation but municipalities and provinces are not taking advantage of it." Those are the facts. The same thing happened from one end of Canada to the other.
Yesterday the parliamentary secretary to the Minister of Public Works referred to the establishment by the provinces of housing authorities. People keep mentioning the constitution as a bugbear and keep saying the federal government is trying to hide behind the constitution. That is not so, Mr. Speaker. Through lack of knowledge of the facts, through not being properly informed as to the possibilities of the federal legislation, full advantage has not been taken of the legislation.
On a non-political basis we are getting good co-operation from most of the provinces, and this is due to our active educational program. That program is now getting results. Let me give some examples. Up to 1964 when the major amendments were made to the National Housing Act there were less than 12,000 public housing units in the whole of Canada. At the time I said that was a disgraceful situation and that more should be done in every part of Canada.

October 3, 1967
Discussion on Housing
In the conversations which I and those associated with me, the officials of C.M.H.C., have had with the provinces and the municipalities we have pointed out and stressed the possibilities afforded by the new legislation. Just by way of illustration, not to give them any special pat on the back, but by way of illustration, may I say that in the province of Ontario alone in the last 30 months or so more public housing units have been built than in the whole of Canada in the previous 15 years. That type of thing is going on in the other provinces where we are getting co-operation. It is going on in Newfoundland and Saskatchewan. Despite what the hon. member for Saskatoon said in this debate yesterday, we should keep in mind the situation in his province.
[DOT] (5:10 p.m.)
How many hon. members know that housing starts in the prairie provinces this year are 47 per cent higher than last year? We are not getting serious complaints from the prairie part of Canada in the housing field. We are receiving complaints from some centres with special problems. Fort McMurray had a special problem and Saskatoon had one. When we get such requests they are attended to, and I might say that we have had nothing but commendation in the last seven or eight months from Fort McMurray. The same applies to the entire prairie region of this country.
The serious housing problems in Canada are largely confined to the growth areas. More specifically, they are to be found in metropolitan Toronto and in the area between Toronto and Hamilton. There are other, isolated problem areas in Ontario, one of them being Sudbury.
How many hon. members know the real story of Sudbury? The Carter report came out some months ago. In it there was a suggestion that mining companies which had made extensive surveys and tests were to be deprived of certain incentives or tax benefits. The government, through the Minister of Finance, made a statement in May last. In that statement it was announced that for the next three years at least there woud be no change in those incentives. Within a matter of days after that announcement, we learned for the first time-when I say "we" I mean the municipality of Sudbury, the provincial government and the federal government-that five new mines were to be opened within 20 miles of Sudbury and that within the next 30 or 36 months 3,000 houses would be needed in the area. Within 48 hours of receiving that

notice I went to Sudbury with senior officials of Central Mortgage and Housing Corporation to inquire into the accuracy of these reports. When convinced they were true I said that two things might be done.
There was a need for public housing. People, I think, should know what is meant by public housing. Personally, I do not like the expression "public housing". I prefer the expression used in England, "council housing", or something similar. In Ontario they call it "Ontario housing". In Canada as a general rule we group all such housing together under the term "public housing". Depending on the agreement with a province, any person with an annual income below a certain amount may apply for public housing. In Ontario the income ceiling, I think, is $5,800. Anyone with an income not exceeding $5,800 per annum may apply for and obtain public housing if it is available.
Many members of the Sudbury mining community and many of those engaged in the service industries around there earn less than $5,800. There was an obvious need for more public housing in Sudbury. I said to the mayor and the other officials, "I will first take this up with the Ontario provincial government; I am sure that we will get their cooperation. We have had it from them when dealing with problems in other parts of the province." I also thought that since many people were to be brought into the area or to be transferred from other activities carried on by the mining companies, that perhaps at least some of those coming in would be at salary levels higher than the ones permitted for public housing.
I feel that these mining companies have a special responsibility to provide houses for their senior executives and even for executives at junior level. The companies are there to make money. Nobody objects to that; it is a worthy objective. The companies have their responsibilities. Before there was any public housing these corporations used to provide houses for their staff. Formerly, in the forest industry towns of British Columbia and other industrial communities which sprang up in different parts of Canada housing was not always of the kind we wish to see. Nevertheless the companies did assist in providing it.
I said to the group in Sudbury that I met that I would discuss the matter of housing not only with the province but also with representatives of the mining companies. I did that and the response from the mining
October 3, 1967

companies was encouraging. We learned that 800 housing units would be needed in Sudbury during 1967 instead of the 400 originally anticipated. Next year the figure may well be 1,200 or 1,400; I do not recall the exact figures.
I took exception to the remarks of the hon. member for Sudbury in the house the other day. He intimated that I had gone up there during the election campaign and had made a political announcement. I immediately put on the record that while I could easily have gone there 24 or 36 hours before the election I stayed away until the week after the election. I went up in late May to see what was to be done and after the election I announced the results that had been achieved.


Some hon. Members:: Hear, hear.


John Robert (Jack) Nicholson: I have wandered away from my original theme. I was talking about the necessity of education, of passing on needed information, of educating municipalities, provincial governments and others with a specific interest in housing. Out of the conferences that took place during the last ten days of January of this year, in February and in March, and out of the subsequent conferences with the representatives of financial institutions-the conventional lenders and approved lenders, the mortgage companies, insurance companies, trust companies and the banks-some very worth-while suggestions emerged. I can now tell the house about some of the suggestions that came out of these symposia and the subsequent meetings. Out of all these there came recommendations for four programs that appealed to me and which I have no doubt will appeal to the majority of my fellow members in the government.
These four programs, all of which were discussed at one or more of the provincial conferences, include the following: First, a comprehensive planning of urban regions and the acquisition of lands for transportation corridors and the open spaces required for urban growth; second, a new community program to stimulate orderly and comprehensive development of new suburban areas within the context of regional and urban plans; third, housing programs to serve as an integral part of other combined federal and provincial anti-poverty measures in specific areas; fourth, housing for moderate income families, not for those with incomes of less than $5,800 but say for those with incomes perhaps between $4,500 and $7,500. These are some of the ideas that came up during our conferences and that need further study. With
Discussion on Housing regard to serious study of the proposed new communities program, a suggestion has been made that the federal government should go in with the provinces and municipalities in undertaking a comprehensive new communities program of the kind that I have just spoken of whereby the federal government might provide special incentives for large scale comprehensive development of suburban communities in certain urban regions. In such a program the federal government might contribute what the three levels of government agreed would be a reasonable amount. Whether it would be 50 per cent, 40 per cent or 60 per cent would be a matter for discussion. In addition, the federal government might make loans comparable in magnitude with the loans it is now prepared to make to provincial housing authorities for public housing.
[DOT] (5:20 p.m.)
Yes, several of those who spoke yesterday and one hon. member who spoke today talked about the federal government "trying to pass responsibility on to the provinces". Nonsense. How many people in this house even realize that any provincial housing authority or municipal housing authority can borrow 90 per cent of the money it needs in this field from the federal government, not at the maximum rate of 8f per cent but at 6| per cent, the approximate cost of money to the federal government. It is largely because of this lending program that we are finding evidence of the increased interest in public housing, which leads me to believe that our expenditure in this field next year will be not $400 million but $600 million or perhaps even more than that.
Included in this suggested program are also resettlement plans. I have for long been interested in resettlement programs and the need for them was driven home at the conferences which took place at Comer Brook, Newfoundland in March last and our earlier one here. As a result of vast improvements made primarily in the fishing industry in Newfoundland, literally hundreds of families who live in isolated outports are being moved into more populated centres. The houses in which they and their forebears lived, perhaps for hundreds of years or more, were perhaps of little value but they did provide a shelter and, what is perhaps just as important, they were owned by the occupants.
Can we expect these people to give up the homes that they own, even though they may be worth only $200 or $300, and move to

October 3, 1967
Discussion on Housing another area in which a cannery is situated or near where a master ship is operating unless they have a personal stake in doing so? This is an area in which it seems to me that the federal government could and should provide assistance. I have used Newfoundland as an example to illustrate my contention, but this is the type of aid that we should like to see given not only in Newfoundland but elsewhere. There will probably be a need for a somewhat similar program, as a result of the developments taking place under the Cape Breton Development Corporation. It was as a result of constructive suggestions of this kind, the type of suggestion that I invited in the house, that in the Speech from the Throne, which His Excellency read in May of this year, it was announced that the federal government would meet with the provincial governments and I believe with representatives of the municipalities to consider the whole subject. The announcement was made in May on the basis of information we had obtained between January and April.
What happened? We in this house are supposed to be politicians. Let us be frank. There were three provincial elections, two in June and one in July. We have known for several weeks that three more provincial elections would take place in other provinces. We also knew that two of the provinces would have new premises. How absurd it would have been in an environment of that kind to have called a conference on this question. I would have liked the conference to be called for June or July, so would my colleagues. I certainly would have liked to have seen one called not later than September or October. But it would have been a frustrating exercise. I want now to assure the house that the meeting will be called if not for November, then in December of the present year. I will see to it that the invitations go out as soon as the results of the pending elections are known regardless of any changes in government. Invitations will go out promptly, and I hope we shall come to grips with these problems at the coming meeting.
I was impressed with a statement made last night by the hon. member for York South (Mr. Lewis), though certainly not all his statements appeal to me. A great many do not. He said last night in the course of a discussion of housing on television that the housing problem in Canada would be solved only by wholehearted co-operation between the three levels of government. I have been saying that for two years and I sincerely
[Mr Nicholson.]
believe this is the only way in which it will ever be solved.
Other suggestions have been made by ther hon. members and perhaps some of them call for comment. The hon. member for Esquimalt-Saanich (Mr. Chatterton) referred to the heavy expenditures being made by all levels of government and the effect they were having on the cost of money and on the cost of living. How many people in Canada, who have read comments on the report of the Economic Council know that two thirds of the money to which the council has referred is being spent by provincial and municipal governments, not by the federal government, and that in the last five or six years expenditure by these authorities has been trebled or quadrupled? Their great increase is the reason for the reference made in the report of the Economic Council.
Criticism was directed toward the government for permitting a higher rate of interest on N.H.A. loans. I think the house should understand just how the ceiling came about. Legislative authority for the imposition of this ceiling was provided not at the initiative of the present government but under another government several years ago. The intention when the provision was put in the act was that should a situation become sufficiently serious at any time a formula such as the one I announced last week could be adopted. We acted on the authority because of the situation that now exists.
The reason for adoption of the new formula is clear. There has been such a heavy demand for the money which was available, not for public housing or those other areas of great social need but for the construction of apartment blocks, the greatest need being in cities such as Toronto and Hamilton and their environs, that interest rates were upset. In December of 1966 we set an interest rate ceiling of per cent for the first quarter of 1967. There was no flexibility involved in that rate. The rate could not move to 7|, nor could it fall to 74 or 7 per cent. It was fixed for the quarter.
Then this is what happened. The rate is tied in with the yield on federal government bonds and in or about February, the yield on those bonds started to go down. It continued to decline in March, as a result of which it was obvious that the 7J per cent rate would drop to at least 7 per cent for the second quarter. In consequence lending institutions, including some banks which hoped they would soon enter the field, began to take
October 3, 1967

October 3, 1967
Discussion on Housing
There might seem to be good reason for doing this, but it is not as simple as it sounds because we must not overlook the person who made an investment in housing last year, with an income of $6,000 or $5,800 or perhaps less. Should it be made retroactive? If it is not made retroactive then there will be discrimination against some of our good people. I should like to admit, however, and I want the hon. member to know, that his suggestion merits serious consideration and it is one which is receiving and will continue to receive serious consideration.
In respect of another suggestion made by the hon. member for Charlevoix and supported by the hon. member for Winnipeg North (Mr. Orlikow), the one concerning the 11 per cent tax on building materials, hon. members heard my colleague the Minister of Finance (Mr. Sharp) deal with that last night. Hon. members know how the Carter report dealt with it. The conclusion of the Carter royal commission is that the money must come from somewhere and that until some new general tax formula has been found that will bring in the money needed the tax on building materials might just as well be left as it is at this time.
Again I should like to point out another difficulty. Is anyone going to seriously suggest that the man who builds a luxury hotel to make a profit or who builds an office building to make a profit and in so doing uses building materials should not pay the tax on the materials that are needed by him any more than a tailor, a manufacturer of television sets or a manufacturer of essential household utilities should? Why should there be any difference in the sales tax such people pay and the tax we pay on necessities? I believe this accounts for the conclusion in the report of the Carter report that until the whole matter has been looked into and new tax formulae are adopted this would not be the appropriate time to make such a change.
I have already mentioned the coming conference on housing, but there is also the mater of research. I wonder how many people in Canada know what is being done in Canada in the field of housing research. I wonder how many people in Canada know what is being done by our federal housing agency, Central Mortgage and Housing Corporation. Our architects and others who have considerable experience in these fields are continually in consultation with the housing authorities of the other countries of the world who are members of the UN. They meet periodically

and exchange data. In addition, individual research grants are made to the universities with the advice and co-operation of the National Research Council in this field. We are doing much more work in the research in this field than people realize.
We are also co-operating with industry in research. Hon. members have heard of the Alcan houses and the use of synthetic building materials. We are using some of these materials in a housing project in England. There is the Maple Leaf project which is being completed at Harlow, near London. I wonder how many members of this house know we have a housing project involving 175 houses at Harlow, where Canadian lumber, hardware, synthetic and other building materials made in Canada are being used. This is being done in an effort to find markets for building materials of this country. It is part of our research program, also part of our trade program. So a lot more is being done in this field of research than many people think and this must, of course, be encouraged.
With regard to the suggestion of the hon. member that we should furnish a greater amount to the provinces and municipalities, I ask him how much more can we be expected to furnish for public housing than 90 per cent. Surely the provinces and the municipalities between them can furnish the necessary land, which no doubt would represent at least 10 per cent of the value. If we are prepared to lend 90 per cent of the money, I do not think any sensible person, who has any regard for the situation described by the Minister of Finance yesterday and by the President of the Treasury Board (Mr. Benson) last Thursday would suggest that we should go beyond that. How many people in Canada know that when it comes to urban renewal the federal government pays 50 per cent of the cost of urban renewal projects, that the provincial government pays 25 per cent and that the municipality, unless it makes an arrangement with the province, pays the other 25 per cent?
[DOT] (5:40 p.m.)
You should also realize that a municipality can borrow two thirds of the money it needs for urban renewal at the same attractive rate from the federal government. This again demonstrates the absolute need for more publicity and for greater distribution of information in this important and essential field.
October 3, 1967

Having regard to the last suggestion made by the hon. member that the federal government should bring pressure to bear on banks to get more funds for housing, let me say that it is all very well to suggest that but it is much more difficult to accomplish. One can exert certain pressures and do a lot of things in the housing field in time of war. My first connection with housing was when I was solicitor for the wartime housing corporation. At that time we did not have to worry about provincial or municipal laws or about niceties, we just went ahead and did what we thought was necessary in the interests of the war effort. It cannot be done so easily in peacetime. In this case the banks and other lending institutions asked me another very appropriate question when I asked for more money for housing. They asked us to make it clear whether we wanted more money for housing or wanted it to buy bonds. They tell us that we cannot have it both ways and they asked for some indication as to what we want, with the assurance they are prepared to co-operate. Let me make it clear, we, the government, have not indicated that we want the interest rate to go up to 8| per cent, but we have told these lending institutions that we are prepared to give them more flexibility so they can exercise their judgment whether they should invest in housing or buy equities, buy bonds, provincial bonds, municipal bonds or federal bonds.
Before I sit down I want to deal with another matter which was raised during our discussion of the estimates last week. At that time my attention was drawn to the fact that the limited dividend provisions of the National Housing Act were being overlooked and that little advantage is being taken of them. This again was brought to my attention very forcefully at one or more of the conferences which took place in March. As a result of studies which have since been conducted I have undertaken to revise our limited dividend program by adjusting upwards the limit of income in respect of admission to such housing units. Perhaps this should have been done five or ten years ago. Certainly it might have been done two or three years ago. However, so little use was being made of the provisions that seemingly they were being overlooked, with the result that people with incomes over $5,000 were not eligible to participate in these limited dividend projects, where there is relatively low interest on the money invested for private entrepreneurs who want to invest their money. As I say, I have undertaken to adjust the income level 27053-176
Discussion on Housing upward. This will mean that in large metropolitan areas those families with incomes up to $7,000 may qualify for admission. In rural areas the income level probably will be lower but in areas such as Vancouver, Toronto and Winnipeg it will be raised to $7,000.
I have nothing more to add Mr. Speaker, and I hope that the contribution I have made to the debate, with the support I have received not only from this side of the house but also a little from the other side, will cause hon. members to take a serious second look at the amendment introduced yesterday. If hon. members do not wish to break party lines I hope they will absent themselves during the vote, thereby assisting us to give approval of the sound principles that we have introduced to get our housing program under way.
In conclusion I should like to express my special thanks to the hon. member for London (Mr. Irvine) and the hon. member for Esquimalt-Saanich (Mr. Chatterton) for the kind things they said yesterday about the Minister of Labour.


Mr. Barnett:: Would the minister permit a question before he sits down?


An hon. Member:: He has already taken his seat.


Jay Waldo Monteith: He might get up again.


John Robert (Jack) Nicholson: That might happen, as I still have a minute or so.


Thomas Speakman Barnett: Having regard to the remarks he has just made about the income ceiling on limited dividend projects being increased, will the minister indicate what the situation will be in mining and forestry communities where similar projects are undertaken?


John Robert (Jack) Nicholson: I cannot give a definite answer to that question. I have been more concerned about the larger centres in relation to the limited dividend problem. This program has been used extensively in and near Calgary but in very few other parts of the country. This situation was brought to my attention recently both in Vancouver and in other areas. I can assure the hon. member that there seems to be merit in his suggestion that this might be extended to new resource areas where the federal government is already giving special assistance. If we can get participation on the part of private entrepreneurs in those areas, we will be happy to do whatever we can to interest them.

October 3, 1967
Discussion on Housing [Translation]


Mr. Laiulippe:: Mr. Speaker, I would like to put a question to the minister. How is it that it is so easy for the government to find capital funds and pay a low interest rate, a mere carrying charge or no interest at all for periods of 50, 60 or 70 years to assist foreign countries, but that when it comes to helping Canadians to buy houses, to find suitable accommodation, it can do nothing better than charge prohibitive interest rates?


John Robert (Jack) Nicholson: In this enlightened day and age prosperous countries such as Canada certainly have international as well as national obligations. I personally would like to see Canada devote even more to the less fortunate nations. The amount now spent on foreign aid is infinitesimal compared with the amount we are pouring into housing.


Stanley Howard Knowles: It certainly is.


Mr. J. R. Keays (Gaspe):: Mr. Speaker, I was happy to hear the minister admit that some of the suggestions from this side of the house deserved study, because I am convinced that many of our proposals were advanced in an attempt to provide a solution to the problem. The problem is not one which relates only to a shortage of housing in Canada, and everyone agrees that it involves a crisis. The problem is of a monetary nature. We hope that the amendment moved by the hon. member for Esquimalt-Saanich will bring the problem to the attention of every member of the house. A solution must be found by those who have been entrusted with the administration of government.
The minister made some comments about the use of housing as an economic regulator and he paraphrased some of the statements in the Economic Council review. I am convinced that the day of using housing as an economic regulator is long past. If the minister will look closely at the recommendations of those who participated in the studies leading to the Economic Council report he will find that they also recommended a second look at the experience of the past regarding the use of housing as a stopgap, to be opened up when more jobs are required and closed when we have full employment. I therefore believe this to be the first step the minister should consider taking. He must keep in mind the fact that housing is an important problem that is with us now and will be with us in future years.

[DOT] (5:50 p.m.)
The minister also spoke about the great changes that took place last year in respect of the percentage of dwellings constructed of one category or another. Surely he is not trying to tell us that this crisis was not foreseen. Surely the government was warned about the changes that would take place in the housing field. The government must have known this situation would exist if they referred to the reports of two years ago and last year and also to the forecast of the swift movement of the population to our urban areas. The government must have known this would create the problems which face us today.
This debate has been of benefit in the following respect. The minister told us that the government is applying priorities with respect to the moneys available for housing. He mentioned housing for families of low income and direct lending for individual homes. The minister has never before made these few acknowledgements. I believe the debate has at least brought out these facts. However, all we have heard from other hon. members opposite who have participated in the debate is statistics pointing up the good record of the government and the bad or not so good record of the previous government. I do not believe we face up to this problem when we invoke the statistics of the past, because those statistics are not comparable with the situation that exists today. I say also, Mr. Speaker, that statistics by themselves do not build shelters. They do not provide homes for those who need them, nor do they make homes available to those in the lower and middle income brackets.
We have heard statements from two ministers, one who increased the interest rate to 8i per cent and the other the Minister of Finance (Mr. Sharp), who refuses to consider the removal of the 11 per cent sales tax on building materials. I am convinced that these are cold approaches to the problem. The only answer the government seems to have is that the problem will subsequently correct itself. In August the Prime Minister (Mr. Pearson) spoke about a conference on housing with the provinces. To date this conference has not been held. I admit that the minister endeavoured to give us a reason for its not being held. But I tell the minister that if we are to take the view that a provincial election every year in one or other of the provinces of Canada will make it impossible to hold such a conference, we will never have a conference of this type because one or other of the
October 3, 1967

premiers will be engaged in provincial political matters. According to the minister's statement it would be impossible to hold such a conference if there were a provincial election in progress.


John Robert (Jack) Nicholson: Mr. Speaker, would the hon. member permit a question?


James Russell Keays: Certainly.


John Robert (Jack) Nicholson: Would the hon. member agree that six provincial elections within four months is a rather unusually high batting average for such a short period?


James Russell Keays: Yes, it is unusual to have so many provincial elections. It is also unusual to have so many problems in the field of housing. I believe it would have been usual had we asked some of the ministers of the provincial governments to contribute in some measure toward a solution of this problem. The minister is responsible for housing and is certainly aware of the increased demand for shelter that was forecast to occur between 1966 and 1970. Yet the minister contented himself with holding symposia in various cities across this land. He forgot to delve further into the real problem of housing which is one of finance.
I ask the minister, what consideration have we given to the construction industry in so far as it affects housing and commercial building in this country? The construction industry is the third largest contributor to our gross national product. Is it more economical to curtail housing drastically? Is it more economical to discourage the building of homes or to make homes unobtainable to prospective home owners? Is it more economical to have corporate investment postponed, with the result that 100,000 people will be unemployed?
If the situation is allowed to continue, during the coming winter months at least 100,000 people will be unemployed. There will be unemployed people who are specialists in the housing industry, and this industry requires many specialties. These people will not be able to sit around until we develop a new housing policy or commence new projects. They will endeavour to find employment elsewhere. The net result will be that when we begin to tackle the housing problem seriously the specialists will have gone. In this event there will be another increase in the cost of construction.
What are we to do about the commercial buildings that have been planned in all our
Discussion on Housing cities and towns? Are we to force people to postpone these projects for another two or three years, thus putting more people on the list of unemployed and affecting the service industries to such an extent that many thousands more will be sent home and asked to draw unemployment insurance? I believe this is one consideration that must be dealt with by the government. Housing is not only a problem; it is a crisis. This we all admit. It is also a financial problem. This we admit. But let us find a solution to the problem, because if we do not we will create a much more difficult financial situation by allowing the construction industry to be reduced by 20 per cent, 30 per cent or 40 per cent. Mr. Speaker, may I call it six o'clock?


Mr. Deputy Speaker:: Order, it being six o'clock, pursuant to provisional standing orders 6 (1) and 15 (4) I do now leave the chair.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.
James Russell Keays: Mr. Speaker, at six o'clock I was trying to impress upon the government the necessity for co-operation between the different departments of government. I was speaking about the responsibility of the government to ensure that the construction industry in Canada whould not suffer from the increased lending rate in connection with housing and also about the importance of assuring the construction industry that we will not use it as an economic tap to be turned on or off.


Mr. Speaker:: Order, please. I hate to interrupt the hon. member but I should bring to the attention of hon. members that many conversations are going on in the chamber. This makes it difficult for us to follow the hon. member's speech.


James Russell Keays: Thank you, Mr. Speaker. I hope I have been able to draw the attention of the government to the fact that, although everyone in the house recognizes that we have a crisis in the housing industry we also recognize that there is a shortage of mortgage funds. However, I believe it is not the role of the members of this house to say that we have these problems, so therefore we must accept them and live with them. We have a duty to perform toward those who need housing, such as the young families across this

October 3, 1967
Division
country, and those who are in the construction industry. I think a solution to the problem can be sought through a study undertaken by the government.
Last night the Minister of Finance (Mr. Sharp) referred to some incentives. He said the following, as recorded on page 2733 of Hansard:
while a remission of the sales tax on building materials is a desirable reform, it is one that is not nearly as important as many others, or many other more important steps that may be taken.
I suggest that if the Minister of Finance believes the removal of the sales tax on building materials is not the most important step that should be taken in order to reduce the cost of housing in this country, then it is his duty to tell us what other measures should be undertaken in order to alleviate the problem. The Minister of Finance, realizing the mess in which we now find ourselves, told us in general terms that there are many other remedies, but he did not specify what they were. He contented himself with saying that we have problems which are going to be resolved but they are going to be resolved at the cost of depriving the majority of Canadians of the right to own their own home. This is the suggestion which he has made. He suggested that time alone will cure this ill. I suggest this is a poor approach to the problem.
[DOT] (8:10 p.m.)
The hon. member for Winnipeg North (Mr. Orlikow) today suggested the removal of the sales tax on building materials used in house construction, but on the other hand said the sales tax should be retained for commercial projects. I do not accept that approach. If we are to remove the sales tax let us remove it completely. Let those with the ability to develop, develop. I do not wish to see the poor remain poor. Let us improve their lot and at the same time allow others who have the incentive to produce retain that incentive and go on producing.
Earlier this year many big developers right across the country postponed construction projects, expecting that interest rates would drop. Now, major construction across the country will drop off. Who will suffer the consequences? The workers in the construction industry will suffer. Earlier in the year money was available at 7J per cent and 8 per cent for major construction. That money will now cost 8f per cent to 9 per cent.
Last week the Minister of Labour (Mr. Nicholson) asked us to admit that the new

interest rate of 8J per cent is a realistic one.
I	say let him be realistic and realize that this new rate is depriving the majority of our population of the hope of ever owning their own homes. Who can afford to own his own home when the mortgage rate is 8\ per cent? If we are going to burn the candle at both ends we will be in trouble.
If we have to pay this high interest rate, I say we should make a serious study of the economics of the situation. By abolishing the
II	per cent sales tax and seeking the co-operation of the provinces on the removal of their provincial sales taxes, we could give more Canadians the opportunity to own their own homes. This is a serious situation, and I was happy, Mr. Speaker, to second the amendment moved by the hon. member for Esquimalt-Saanich (Mr. Chatterton).


Mr. Speaker:: I declare the amendment lost.
Division


Martial Asselin: Mr. Speaker, I was paired with the hon. member for Riviere-du-Loup-Temiscouata (Mr. Gendron). Had I voted, I would have voted for the amendment.


Douglas Scott Harkness: Mr. Speaker, I was paired
with the Minister of National Defence (Mr. Cadieux). Had 1 voted, I would have voted for the amendment.


Herbert Wilfred Herridge: Mr. Speaker, I was paired with the hon. member for Matapedia-Matane (Mr. Tremblay) who was called away to attend a state function. Had I voted I would have supported the amendment.


Mr. Watson (Chateauguay-Hunlingdon-Laprairie):: Mr. Speaker, I was paired with the hon. member for Wellington South (Mr. Hales). Had I voted, I would have voted against the amendment.


Mrs. Wadds:: Mr. Speaker, I was paired
with the hon. member for Niagara Falls (Miss LaMarsh). Had I voted, I would have voted for the amendment.


William Skoreyko: Mr. Chairman, I was paired with the hon. member for Victoria (British Columbia) (Mr. Groos). Had I voted, I would have voted for the amendment.


Mr. More:: Mr. Speaker, I was paired. Had I voted, I would have voted for the amendment.


Mr. Speaker:: The question is now on the
main motion. The hon. member for Cumberland.



TRANSPORTATION-EFFECT OF NEW FREIGHT RATES ON MARITIMES

Mr. Robert C. Coates (Cumberland):: Mr. Speaker, I have a grievance. I suppose I should say my main grievance is the fact that we did not win this vote. To be more realistic, I should like to say that there is no matter of more immediate concern to the Atlantic provinces than transportation, especially when it affects the movement of goods in or out of the area. This must obviously be evident to the new Minister of Transport (Mr. Hellyer), and to the government, as a result of the decision of the Board of Transport Commissioners on August 2 to allow the new non-carload tariff which became effective on September 2.
October 3, 1967
2782	COMMONS
Rate Structure on Freight on Maritimes
As a member from the maritimes, I could use many words that have been used by politicians from our part of Canada since 1867 to describe our feelings as a result of changes in rates, rules, practices and conditions and all of them would qualify so far as
1	am concerned to describe the urgency of the situation which now faces the business community in the Atlantic area.
I am sure the minister has been informed by members of his own party of the dangers which are inherent in the new rates for l.c.l. shipments. At the same time, I must assume that the minister either has not considered the matter to be as serious as I believe it to be or that the members of his party who have brought the matter to his attention have not been able to impress him with the extent of the damage that has already been evident and which will continue to be in evidence unless action is taken immediately.
I wish to urge the minister immediately to effect a moratorium on the decision of the Board of Transport Commissioners of August
2	and allow a period in which proper submissions can be prepared to show why the new rates should not apply in the Atlantic provinces. The arguments against the allowance of these rates are as old as confederation. We, as Canadians, should not be entering into the second century of confederation in a far more disadvantageous position than that in which we were when we entered into union in 1867.
In recent years, the provincial governments in all four Atlantic provinces have made a determined effort to attract new industry and maintain old industries in our area. We have always been at the mercy of the railways in so far as transportation is concerned because we have not had the competition that is very much in evidence in central Canada. While the new rates do represent reductions in former first and second class express rates, this is of no interest to shippers who formerly used l.c.l. freight service, the type of service which previously looked after the large volume of non-carload traffic. From this point of view, this type of traffic is subject to very severe increases. Articles of a bulky nature such as luggage, boats, canoes and potato chips will have to face staggering increases. Examples indicate increases as much as 288 per cent for potato chips, 369 per cent for canoes, 171 per cent for outboard motor boats and 228 per cent for steel tanks. Another example is the increase on stoves or ranges where the increases average 90 per cent.


[DOT] (8:50 p.m.)
In the area of the Atlantic provinces with which I am familiar there is a manufacturer of luggage, namely the Christie Trunk & Bag Company. They desperately need an alternate form of transportation if they are to compete on a regional and national basis. There are two stove manufacturers in Sackville as well as The Enterprise Foundry Company Limited and Enamel & Heating Products Limited. These organizations have been in business for many years and have surmounted almost every imaginable obstacle in order to maintain national businesses. They certainly will find difficulty in hurdling this last obstacle created by this government in the form of this substantial increase in the new freight rates.
If this government is concerned about inflation, surely it does not want to increase the burden that will naturally fall on the shoulders of the consumers by increasing the freight rates, which will be the result of the freight rate structure now proposed by the railways. If the railways wish to maintain their volume of business, a more realistic set of rates should be adopted, particularly in view of the fact that shippers have had less than two weeks to prepare themselves for these new rates, although the new rates on non-carload lots were filed with the Board of Transport Commissioners on August 2. Would it not be proper and prudent for the Minister of Transport to declare a moratorium in order to take a long second look at the likely results of these increased rates, and a second look at what may happen to the business communities of the Atlantic provinces if these rates are maintained? In this way the government could show the people in that part of Canada that it is not the minister's or the government's wish to drive many of these small businesses, and perhaps many of the larger ones as well, into bankruptcy. Let me suggest to the minister that a very real crisis exists in the Atlantic provinces as a result of these less than carload lot rates. I ask the minister to take action now.


Mr. Melvin McQuaid (Kings):: Mr. Speaker, it is not my desire to unduly prolong this debate but I feel I should add my voice to those protesting this single rate structure which has been described, I think correctly, as the most radical rate change in the century. This is bound to have a discriminatory and adverse effect on the economy of the Atlantic area. I cannot understand why there seems to be a diabolical design on the part of this government to discriminate against this
October 3, 1967	COMMONS
area which needs all the help it can possibly get to improve its economy.
In substantiation of that fact, one has only to look at the latest report published by the Unemployment Insurance Commission which indicates that during the past fiscal year it paid out $52.5 million in unemployment insurance benefits in this area. Surely this gives hon. members an idea of how badly the economy of the Atlantic area needs a shot in the arm rather than the type of discrimination which will occur under this new freight rate structure.
The amount paid in unemployment insurance benefits in the Atlantic area is exceeded only by the amounts paid in the provinces of Quebec and Ontario, and we must not forget that those two provinces have greater labour forces than the Atlantic provinces. In 1966 in the Atlantic area the labour force consisted of 626,000 people. In January of that same year there were 106,000 of that labour force unemployed. That represents 17 per cent of the total labour force, the highest percentage in any part of Canada. Yet, this government has the temerity to go along with a rate structure which is definitely going to discriminate against the economy of that area.
In the Atlantic area we have the lowest average wage of any area in Canada. In 1966 the average wage, not including agricultural wages, in Prince Edward Island was $64.71 per week; in Nova Scotia it was $76.27 per week; in New Brunswick it was $80.22 per week and in Newfoundland it was $84.91 per week. The national average wage in Canada for the same period was $96.53 per week. In view of these figures, is it any wonder that we in the Atlantic provinces are asking for help to improve our economy? Whenever the government gets the opportunity it discriminates against us. This latest move to unify the rate structure, if I may use that term, is just another example of this discrimination.
There is no question but that this new rate structure will increase the cost of production and increase the cost to the consumer in the Atlantic area. Normally a change of this kind would have to be approved by the Board of Transport Commissioners, but by reason of the new legislation enacted not long ago this approval is no longer necessary. If you refer to the debate that took place at that time you will find it was pointed out that this system would result in our freight rates being increased. At that time we were assured that this would not be the effect, yet today we find our fears have been realized.
DEBATES	2783
Rate Structure on Freight on Maritimes
Not long ago I read a press report to the effect that the hon. member for Westmorland (Mrs. Rideout), when questioned about this matter said that she had been assured by the government that there would be no discrimination against the Atlantic area. I hope the hon. lady has the courage to stand up tonight and castigate the government for allowing the present situation to develop.
This new rate structure will be of some assistance to those manufacturers and shippers who have been shipping entirely by express, but there are many small manufacturers in the Atlantic area who ship from point to point within the area who will be adversely affected. They do not manufacture or sell their products on a scale which would allow them to ship carload lots.
The new rate is apparently based on cubical content, which is multiplied by ten pounds per cubic foot. I wonder where that ten pounds per cubic foot formula was found. It seems to be exceedingly high in view of the fact that when you ship by air, and the capacity of an aircraft is much less, the cubical content is multiplied by 6.9 pounds. This new formula will tremendously increase the freight rate for manufacturers who ship less than carload lots. I think it has been accurately estimated that in some cases the rate will go up by some 282 per cent. Surely, this is a tremendous discrimination against the small manufacturer in the Atlantic area who ships from point to point. It will not greatly affect the larger manufacturers in central Canada who ship mostly carload lots.
[DOT] (9:00 p.m.)
We have a great many small manufacturers in our area, Mr. Speaker. I suggest that industry should be encouraged and we should not trample upon the transportation facilities that exist. As I say, we have in the area a great many small manufacturers who will suffer severely, if not be forced into bankruptcy, by this change. I therefore suggest that the government give very serious consideration to nullifying this change, and immediately.


Hon. Hugh John Flemming (Vicioria-Carle-ton):: Mr. Speaker, any remarks which I shall make or any ideas I attempt to advance this evening have been pretty well covered by the hon. member for Cumberland (Mr. Coates) and the hon. member for Kings (Mr. McQuaid) who has just spoken. However, there are a few matters I should like to bring to the attention of the new minister. In the same breath I congratulate him on his new portfolio. If he
2784	COMMONS
Rate Structure on Freight on Maritimes considers it to be an easier job than his previous portfolio, we will try to convince him in the next hour that this is not so.
It seems to me that we have to deal with the whole question of the change that has been made. As was pointed out by my hon. friend for Kings, the change has been made without going before any judicial body which would examine the effect it will have upon the industries of the region concerned. I ask the minister to take particular notice of this fact. I believe that the change in rates and the elimination of the less than carload rates, with the substitution of express rates at a much higher figure, will impose a tremendous hardship on all small businesses; and the maritimes are full of small businesses. It is in small businesses that for many, many years the people of the maritimes have been employed.
Therefore, it seems to me this is a special situation so far as the maritimes are concerned and the minister should seriously reconsider this new policy. He should also consider that there are only a few industries producing goods in sufficient quantity to take advantage of carload shipments, the availability of transport trucks and that sort of thing. It was my understanding during the debate on transportation that we were looking for a national transportation policy for this country. Ever since I was honoured by being elected a member of this house I have heard the cry, regardless of the complexion of the government in office, for a national transportation policy.
I am sure that every hon. member who listened to the debate on transportation felt that we were perhaps now moving toward a national transportation policy. As I understood what was said in that debate, and as it was explained to us, the medium of transportation that would be used would be the most economical. I believe that was part of the argument used in favour of the act as it now stands. My hon. friend for Cumberland is quite correct when he says that this whole question of transportation is as old as confederation. We all know it is as old as confederation. We all know that what made confederation possible was the promise of the Fathers of Confederation that railways would be built. At that time railways were the medium of transportation. We have built railways to the east.
As I am sure the minister knows from his reading of the history, preferential rates were extended to the maritimes at the time of the building of the Intercolonial Railway. Later,

DEBATES	October 3, 1967
the railway was built connecting the province of British Columbia with central Canada. This made the whole of the country one new nation. Part of the deal by which confederation became possible, concerned the question of transportation. Today, transportation is just as important as it was in those days. Perhaps it is now even more important. Therefore, I appeal to the minister to review this whole question.
I have some information in this respect. I am told that in the constituency I have the honour to represent in this chamber some industries will be most adversely affected by this change in policy. I am sure that the point raised by my hon. friend from Kings with respect to cubic content is very detrimental to the producers of potato chips. While I cannot speak with authority as a result of having contacted these producers, I have no reason to think that the information at my disposal is anything but accurate.
Therefore, I ask the minister to look into the question of this particular product. Nothing could be more important than that we have this industry in our constituency. We have several large food processing plants, and the potato chip industry and the transportation of this product is most important. Anyone who read the last issue of the Executive magazine will have seen the picture of the two McCain boys on the front page, with their families. I must say this is a most attractive picture and I commend it to the attention of the minister, if he has not already seen it, because it is an excellent piece of work.
We are very proud of the McCain family, what they have accomplished and the fact that they have a world wide market for their product. They have obtained a market for the produce of the farms, not only for potatoes but for various other products processed in their plants. We view with a great deal of alarm and misgiving any proposal that would in any way harm this industry.
We have the Hatfields in Hartland and the Piries in Victoria County. We are concerned about the effect of this policy on such industries because we do not want anything to happen that would impair the activity of these companies or the people they employ. These people represent a great proportion of the available labour force in our locality.
In the lower part of New Brunswick we also produce candy. I am given to understand that there are increasing difficulties in the
October 3, 1967	COMMONS
marketing of this product because it is required to be shipped a long way and transportation is vital to the industry. My hon. friend from Cumberland has referred to Sackville. I have always believed that the building of stoves in Sackville is a negation of the general idea that you cannot have heavy industry in the maritimes. In this part of the province one of the heaviest articles of equipment is built, namely, stoves. They have to be shipped as far west as the Pacific coast and compete with similar products from central Canada.
We are concerned about anything that would detrimentally affect this industry. It is not my intention to pick out these industries particularly, but they just occur to me as examples of the industry in the region. I am sure the minister would wish to give his special attention to these matters and would not allow a change in policy of the nature suggested to jeopardize the continuation of this type of business.
[DOT] (9:10 p.m.)
I understand that by the substitution of express rates for less than carload freight rates a tremendous hardship is imposed which sometimes amounts to as much as 200 per cent or more, as has been mentioned by one of the previous speakers. I am sure the minister is not anxious to see that sort of thing continue, and I appeal to him to give his personal attention, at the first opportunity, to remedying this injustice. I believe there might be a severe injustice in the activities I mentioned.
I should also like to mention that the town of Woodstock in the county of Carleton has recently seen the establishment of a piano factory. Everybody knows that it is impossible to ship carloads of pianos. I think that the elimination of less than carload rates would be a very serious matter for them, although I confess I have not heard anything from these people; they have not made any protest to me. I am simply worried that this newly established industry, which is just now getting into operation, might run into trouble. When the premier of New Brunswick spoke the other day during the ribbon cutting ceremony, he visualized this factory as the future piano centre of the world. In view of the fact that there will be an election soon, his exaggerated language may be more readily understood. Nevertheless, he visualized Woodstock as the piano centre of the world. If he is right in some of these happy thoughts, then no one would want to interfere 27053-177
DEBATES	2785
Rate Structure on Freight on Maritimes with this project. So, I ask the minister to look into that particular point as well.
I have now exhausted the notes that I have here. I hope the minister will give my comments the attention which I think they deserve.


Robert Jardine McCleave: Mr. Speaker, I wish to join the hon. member for Cumberland (Mr. Coates), the hon. member for Kings (Mr. McQuaid), as well as the former premier of the province of New Brunswick in raising a grievance on these rates at this time. I shall make my chief point first, and I shall return to it later in my remarks.
When the new brave world of Canadian transportation was unfolded before us in all its wide flung splendour last year one assurance was given to Atlantic Canada, namely that our problems would be dealt with separately and fully and that in the meantime, until they were dealt with in this parliament, no harm would befall the citizens of Atlantic Canada. Yet, as has been so well unfolded by the previous speakers, we have had an increase in rates that was unexpected, unjustified and against the very spirit of the words proclaimed by the government spokesman, the former minister of transport, even though he or his successor may be able to hide behind the small print. So many of us on this side argued last fall when the transport act was being debated that no government and no parliament should attempt to deal with transportation problems on a piecemeal basis. If there were going to be a national transportation policy, then let it apply to all of Canada. We were assured that the government would deal first with the area west from Quebec. Then, they would get around to the specific problems of the Atlantic provinces and deal with them satisfactorily at a later date. However, this assurance hinged on two things; first, the words "at a later date", and second, that we were going to get the report of the special committee which had struggled with Atlantic problems for lo, these many moons. The later date is now, that is obviously to our disadvantage; the committee has reported, and that also is obviously to our disadvantage. I only wish that instead of being here, addressing you and other members of the house tonight, I and other members were out fighting this issue because it properly belongs in the hands of the people who can decide whether or not the government has kept faith with them. They have not kept faith with the people in Atlantic Canada.
2786	COMMONS
Rate Structure on Freight on Maritimes
Let me compose myself for a few moments before returning to the main subject. A few days ago an Ontario bom vice president of what is, I believe, the oldest business firm in Halifax and one of the oldest business firms in Canada, Mr. E. G. "Ted" Jarvis of William Stairs Son and Morrow Limited, had the following to say in an interview with the reporter for the Halifax Chronicle-Herald. I quote from the end of that interview the following statement by Mr. Jarvis:
With the new rates, a merchant must raise his prices, and I think the public should know why.
That is the crux of the question before us this evening. There is a simple answer which can be given to the public why these increases have come into effect. It is that we were given an assurance when the new transsport act was passed by parliament and later we were given something else entirely. That is why hon. members have spoken before me and I am sure hon. members will speak after me in this chamber this evening. We were promised that our province would be dealt with separately, but in line with the national transportation policy some time during the current session of parliament. Now, we are confronted with the possibility that small businesses in Atlantic Canada may be driven to the wall, and heaven only knows Atlantic Canada can ill afford that. Some of these small businesses will be driven to the wall by the natural turn of events, but surely this should not happen as a result of an unnatural turn of events. That is why I wish that an issue such as this one could be taken before the people so we could put right what is obviously wrong.
Let me put it in the terms of a small business man, someone who cared enough to spend $100, $150 or $300 to place an ad in the Chronicle-Herald of Saturday, September 30, 1967. His name is David Cuperfain. He deals in shoes, a humble but basic need. I think I can tell my hon. friends across the way that politically he is uncommitted. I know because I have talked to him. I would like to have him in my corner. I think that after this he will be in my comer, but at least he has been looking around. He will not do any shopping at the current Liberal prices. Here is what he said:
At the beginning of this month a noose was put around the economic neck of our region which is going to strangle it as sure as the sun is going to rise tomorrow.
The railway companies put into effect a new freight rate which increased the cost of railway freight, in some instances, by up to 400 per cent.

DEBATES	October 3, 1967
"Impossible" you say. Permit me to demonstrate to you. Our firm received 240 pairs of children's rubber boots, that sell for $1.99 in our store, Under the old freight rate structure our railway freight bill would have been $16.00 or over 6 cents per pair; under the new rate we were charged for exactly the same shipment $57.60 or a whopping 24 cents per pair.
Mr. Speaker, I did my arithmetic and according to my calculations the increase in the rates has caused the cost of these shipments to increase by $41.60. This represents an increase of somewhere in the neighbourhood of 400 per cent. No wonder there is an outcry in Atlantic Canada about this sort of thing, especially since it came like a bolt from the blue.
[DOT] (9:20 p.m.)
Continuing with Mr. Cuperfain, he makes this point:
Under the new freight rate system the railways are required to charge us a so-called uniform rate, but in areas where there is competition from the trucking industry the railways can and will cut those rates to meet the competition. And so, central Canada, with an active and competitive trucking industry, will get a cut in their freight rates by the railways and we in this region will pay much more. Can you see the diabolical arrangement? We, trying to build up our economy by every means possible, will not only be pushed back to a subexistence but we will in effect be subsidizing the freight rates of our affluent cousins in central Canada.
Does that argument sound familiar, Mr. Speaker? It has been repeated over and over again in this chamber for the last 20 or 30 years by a right hon. gentleman who is not with us at the moment but who will be back, and by others. It has been the same message over and over again. When the increases come, they fall on the eastern and western part of Canada because the central part of Canada has at least the built in safety of competition. The result for Atlantic Canada is that the price of our import goods goes up, and the competitive factor we had hoped would encourage our export goods goes down.
The Maritimes Transportation Commission in its "Tips and Topics" for September, 1967, makes a point which I think is a further indictment of the government, the Department of Transport and its minister, or the new set-up that was brought in by the government. The article reads:
The new non-carload tariff which became effective on September 5 was filed with the Board of Transport Commissioners on August 2, 1967,
October 3, 1967	COMMONS
I interject parenthetically that this is not long ago, about a month and four days.
It was not until August 21, however, that sufficient details were available to the Maritimes Transportation Commission to commence an assessment of its effect on Atlantic provinces shippers.
Now, sir, we are getting into an area of two weeks and one day.
Concurrently with the coming into effect of the new tariff, all non-carload express rates were cancelled, with the exception of certain less than carload rates on Atlantic provinces fresh fish and seafood. Less carload freight rates issued to meet motor truck competition were also cancelled September 5. The published charges for cartage services were likewise cancelled on September 5.
We are right down to the eleventh hour, sir, with these various tariffs.
After September 5, the railways will no longer provide cartage service for non-carload traffic except when such traffic is assessed the new noncarload rates. Other less than carload class and commodity freight rates on Atlantic provinces' traffic have not yet been cancelled and shippers may utilize these rates provided the consignee and shipper perform the pick-up and delivery service.
That is the situation in an economic nutshell as seen by people familiar with transportation. But I can put it in an even smaller and neater nutshell than that. We, in Atlantic Canada, have been had by the transportation policies of the government. I say that again, sir. We have been had by the transportation policies of the government.
Again, I go back to my first thesis. If the government had presented a national transportation policy with all its ramifications, pro and con so far as my area is concerned, and pro and con so far as any area is concerned-we all have to live with the credits and the debits of confederation-showing the effects on our own areas, we would have been in a proper position to assess the benefits and the disabilities to Atlantic Canada, as well as the benefits and the disabilities to central and western Canada.
However, we were promised something. We were promised, "Your problems will be dealt with separately, and in a very fine way." That was a promise which we accepted in the House of Commons last year, and unless the government can remedy the situation now the only redress to achieve what we thought that promise meant is to go to the people and change the government.


Some hon. Members:: Hear, hear.


Heath Nelson Macquarrie: Mr. Speaker, in my ten years in the house I have 27053-1771
DEBATES	2787
Rate Structure on Freight on Maritimes not taken part in what is known as the grievance period, but tonight I am moved to say a few words. I would like to say that the brevity of my remarks is in no way correlated with the depth of my concern for the subject which the hon. member for Cumberland (Mr. Coates) has so very efficiently, effectively and eloquently opened.
I agree with what my colleagues from the Atlantic provinces have said about the problems, resulting from developments following the passage of new legislation in the field of transportation. As the hon. member for Cumberland has said, transportation issues are to us as old as confederation. Obviously, because of our geographical location, transportation and communication have been in the very forefront of our economic and political problems and of the economic and political queries which we have directed to the central government.
As my colleagues have indicated, at the present time there is a feeling of disappointment, to use a euphemism, resulting from new methods, new changes, which have exacerbated and aggravated existing problems and inequities, some might say iniquities, that have existed and do exist as the result of our geographical location. I would like to submit, sir, that for two areas in our region, the two island provinces, the difficulties are especially acute.
In Prince Edward Island, along with the less than beneficent results of the new legislation, we have been subjected to an increase in the rates on transportation, including ferry transportation. We have been subjected to a further delay in the causeway. Needless to say, neither factor has done anything for our economy, or for the hopes and aspirations of our people who, as long ago as 1873, were given precise, definite commitments in the realm of transportation.
On the other island, Newfoundland, the people are faced with something disturbing to them sociologically, and very upsetting in terms of economics, the withdrawal of passenger service on the railway. None of these things were mentioned in the terms of union some few years ago. I am disturbed about the surprising calm in reference to this very important measure, a startling economic deprivation and a major transportation dislocation in the newest province of the dominion. If no one is going to speak for that new province, I would venture to say a word on its behalf tonight. This is not to suggest, God knows, that Prince Edward Island has no problems-
October 3, 1367
2788	COMMONS
Rate Structure on Freight on Maritimes


Mr. O'Keefe:: On a point of order, Mr. Speaker-


Heath Nelson Macquarrie: Prince Edward Island has problems, but I do say-


Joseph Phillip O'Keefe: On a point of order-


The Acting Speaker (Mr. Rinfret):: Order. The hon. member is rising on a point of order.
[DOT] (9:30 p.m.)


Joseph Phillip O'Keefe: I addressed the house earlier on this very problem which is of intense concern to all members of the house and of particular concern to those representing the maritimes.


Heath Nelson Macquarrie: I was basing my remarks on the fact that a careful reading of the St. John's newspapers shows they were decrying the failure of many members representing Newfoundland to respond to certain indignant representations from labour unions. It is not my purpose to enter into a crossfire with members from another province or party. I am only interested in the enhancement of the transportation facilities in Newfoundland. As a member of another island province which has suffered much at the hand of the dominion government, the hon. member might appreciate our help rather than seek to divert me from my cause.
On behalf of the hon. member's province, I wish to say that the forcible unemployment of hundreds of people in Newfoundland is of great concern. I ask the Minister of Transport (Mr. Hellyer) to bend a sensitive ear to the problems of those people. I have seen little indication of sensitivity, but I live in hope. I do not thrive on adversity and I would be more interested were the minister to take an active part toward making the transportation legislation more sensitive to the needs of our area and especially to the needs of the island provinces which will need, after many years of inequality, some measure of redress. Let us have that rather than the bureaucratic, soulless interpretation which will leave us farther behind the rest of the country than we now are. I urge the minister to take an early look at some of those problems which my colleagues, and especially my colleague from Kings (Mr. McQuaid), so eloquently elucidated tonight. This is a grievance, as transportation so often has been a grievance in this country. We are suffering today because the central government lacks sensitivity. I invite the government to remedy their political situation by taking concrete steps,


economically and legislatively, not so much on our behalf as on behalf of our area and the country as a whole.


Mr.  R. Gordon L. Fairweather@Royal: Mr. Speaker, as the hon. member for Queens said, it is not the intention of those of us representing maritime constituencies to make this grievance a partisan matter.


Some hon. Members:: Oh, oh.


Mr. Fairweather:: I hesitated before seeking the floor. I hoped that a maritime member who supports the government would share our concern for this most serious matter.


An hon. Member:: Why are you laughing?


Robert Gordon Lee Fairweather: Because I have a happy attitude toward problems and I feel that to smile is better than to smirk or sneer.


Some hon. Members:: Hear, hear.


Robert Gordon Lee Fairweather: I had not expected, when rising in this debate, to share my personal philosophy with the house; but if challenged I shall be ready for that, too.
Let us return to the issue, the change in the transportation economics of the maritimes. As the hon. member for Victoria-Carleton (Mr. Flemming) has said, the l.c.l. rates have been abandoned and express rates imposed on less than carload shipments. I think that the new minister, who does not yet represent a constituency in the maritimes, will be glad for this crash course in maritime transportation economics. He will not learn much from this speech; still, he will get the idea that we who oppose the government are united in this serious grievance.


Some hon. Members:: Hear, hear.


Robert Gordon Lee Fairweather: I will leave to others the difficulty of pointing out to the minister the benefits of this joint briefing. It is obvious that there are many disabilities in the area. Perhaps we should not advertise them; but if we are to speak factually it is well to admit that many obstacles face the industrialization of eastern Canada, not the least of which is the obstacle of transportation.
I will not repeat what has been said about specific instances, but I will say that lately in the Atlantic provinces, through the help of the Atlantic Provinces Economic Council and the Atlantic Development Board, we have been enabled to take a united stand on some of the disabilities that plague us.
October 3, 1967

The Atlantic Development Board has seen fit through public spending-I think the nation agrees with this-to alleviate some of the major road transport difficulties in that part of Canada.
The minister could be of specific assistance were he to have an urgent study made of the need for off-loading feed grain from vessels in the port of Saint John. It is a paradox that this great winter port can load cargoes for world markets and yet has not the facilities for off-loading grain, which is so necessary to agricultural economies in the lower and western part of New Brunswick.
The new cliche in parliamentary language is "priorities". I am interested in the development of cliches in parliamentary language, and "priorities" is the present one. I join my colleagues in asking the new minister to make it a matter of urgent priority to investigate those transportation matters that are of serious concern to many of us who represent Atlantic Canada.


Robert Muir: I wish to take a few minutes of the time of the house to talk about this question which is of vital concern to the economy of the Atlantic provinces. I wish to thank the hon. member for Cumberland (Mr. Coates) for bringing this matter before the house this evening. Only this morning I received communications from my constituents, including one from the president of the North Sydney board of trade, in which they complained bitterly about these drastic freight rates.
I am pleased to see the minister. I do not wish to be harsh with him. He will agree, I am sure, that we became fond of each other when he was minister of national defence. I hope he does not take anything I say personally.
Before I go into detail may I place on the record the views of the Sydney board of trade as they appear in the Cape Breton Post of September 28. I shall deal with that immediately, as time is important.
The minister is aware of the views of those who have spoken here. I wish him to hear the views of others, outside this house, on this important subject.
[DOT] (9:40 p.m.)
Before I begin to quote from this newspaper may I say that the spokesman for the Board of Trade, a person by the name of Harvey Webber, was a prominent citizen of Sydney, a decent fellow and a good type of citizen. All I can say is that I have never
Rate Structure on Freight on Maritimes known him to be a member of the party to which I belong. The heading reads: "Freight Rate Hike Blasted by Trade Board" and the
article says:
The Sydney Board of Trade has strongly objected to the Minister of Transport and the Express Traffic Association concerning the rushed implementation of a new system of railway freight rates v/hich the board says will have a serious effect on consumer prices in the Atlantic Region.
The board has been informed that under the new legislation railways do not require approval of rate increases.
In fact, Harvey Webber, president of the board, says the new rates were not made available to the Maritime Transportation Commission until August 21 and were implemented September 5.
Mr. Webber says the new system of freight rates introduced by the railways for less than carload freight service will have a serious effect on consumer prices in the eastern region.
These increases, he adds, along with many other radical changes, climaxed the railway's amalgamation of their express and less than carload freight services by the establishment of a single structure of rates, rules and terms of carriage for all noncarload traffic.
The board president said that "due to our geographical disposition, the Atlantic region is the largest railway user per capita in Canada, and, therefore, we are faced more with the increased costs."
Increases brought about by the changes have had the effect of cancelling any advantage brought about by the Maritime Freight Rates Act.
Mr. Webber adds, "According to figures released by the Maritime Transportation Commission representing local shippers, rates have increased by as high as 282 per cent in some cases."
One example of the new rate structure, he says, would be to send 35 pounds of clothing from Stellarton to Quebec City. Former freight charges would have been $2.72 freight or $3.25 express. Under the new rate system it is $4, an increase of 47 per cent and 23 per cent respectively. Shipping a canoe from Truro to Halifax will now cost nine times more than under the old rate system.
These new rules are due to the size and density formula based on 10 pounds per cubic foot of area, the charges will be based at 10 pounds. When dealing with items such as small chicks the effect is startling for cost increase.
The Maritime Provinces Board of Trade has submitted a strongly worded brief on the subject to provincial premiers.
But, Mr. Webber says, all businessmen and other shippers should concern themselves with this increase and its possible detrimental effect on our economy. "Consumers can expect to pay more for items shipped into this area by rail," the president adds.
I hope the minister has listened carefully to these comments by the Sydney Board of Trade as they appear in the Cape Breton Post. He smiles. Of course, to him Sydney is just a spot on the highway somewhere and I assume he is not too interested. At election time, though, he can become vitally interested.
October 3, 1367
2790	COMMONS
Rate Structure on Freight on Maritimes
Another point I should like to make is this. During the period in which the minister was in charge of national defence the closing of bases in the Atlantic region threw hundreds of people out of jobs. In my own area 700 were thrown onto the streets by the closure of Point Edward naval base; not only have they been thrown out of employment but they face skyrocketing prices.
Since we have now lost the "skipper", the fellow from Bonavista-Twillingate, I thought we would now see a new look in the department. I understand from what I have read that the greatest ambition of the former minister of national defence was to become involved in transport, and that if he did he would make dramatic changes throughout the country and do great things for the future. I hope he will. Many fields of activity have been suggested and with the power he has in the cabinet I am sure that with one snap of his fingers he could bring about changes in these freight rates which would greatly benefit us in the Atlantic region.
With regard to Newfoundland, I have no doubt that the hon. member for St. John's has made strong representations on this subject but the cabinet never turns on its hearing aid no matter where the representations come from, whether from members of this party or members of their own. I have no doubt the hon. member has made representations on behalf of his own province; the fact that he was so close to the former minister of transport should have helped. That gentleman was a transplanted Newfoundlander; he was established there though he was not nominated by any convention. In any event, he has gone to greener pastures-and I mean, greener.
I do not wish to take up any more time. I am sure we shall have the opportunity on many occasions in the future to whisper into the ear of the present Minister of Transport (Mr. Hellyer) many of the things we should like him to do. Now that he has a new portfolio, let him not, for heaven's sake, make a mess of the Department of Transport as he did of the Department of National Defence.


Mr. J. P. Nowlan (Digby-Annapolis-Kings):: I wish to add my voice to those of other members of the Atlantic area who have spoken during this grievance period on the subject of these freight rates which adversely and drastically affect the maritime economy.
Members more senior than I have spoken of their experience in taking part in grievance procedures. As a relatively new member I have wondered as to the effectiveness of
[Mr. Muir (Cape Breton North and Victoria).!

this procedure. On this occasion, though, I have been impressed as, I am sure, the new minister has been impressed, by the fact that all hon. members who have taken part have addressed themselves to one basic problem which adversely affects the whole eastern region of this country.
I appreciate some of the minister's difficulties. He has entered upon the duties attached to a new and challenging portfolio. Moreover, last year in a dynamic and somewhat controversial way he was involved in the passage of a bill which caused a great deal of controversy and anxiety throughout the country. As a result, he does not, perhaps, appreciate some of the nuances involved in a transportation bill which gives the railways the power to do what they have done in the Atlantic region.
This is the nub of the problem. This concerns more than a bunch of maritimers crying in the wilderness over what has happened. The minister has shown in the past he can take dramatic action if he considers it to be necessary. We hope he can do as much to alleviate the position in which we now find ourselves. During the last ten years we have in the maritimes been giving effect to "operation bootstrap". We have been trying to lift ourselves up by our own bootstraps. Now, in the first year of the second century we find ourselves faced with "operation blackjack". We pull ourselves up by our bootstraps and get hit over the head by the blackjack in the form of these new rates which setback the whole of the Atlantic area.
I shall not speak at any great length because I know the minister is dying to get up and give some answer to the points we have raised.
[DOT] (9:50 p.m.)
In addition, since this is a non-partisan debate, I would love to hear from members opposite about this problem which involves people from all corners. The hon. member for Halifax (Mr. McCleave) said that somebody was not in his corner. I do not care, in whose corner these people are. They are not in one political corner or another; they are backed into a corner by the use of these l.c.l. freight rates. These rates have no connotation to anything. In this case the Atlantic area has been hit over the head with a blackjack because these less than carload rates are of no use to the east. We do not have pool cars, association cars or piggy-backs; we do not have the great volume that the other parts of Canada have. We have to ship in less than
October 3, 1967	COMMONS
carload lots. Here, we are faced with rate increases such as the 288 per cent increase for potato chips. I have several potato chip factories in my constituency. The hon. member for Victoria-Carleton (Mr. Flemming) also has some in his constituency, although their product is not as good as the product from my constituency. There is the 369 per cent increase on canoes. We do not have many canoes, but we do have furniture and motor boats. When there is a 400 per cent increase in the rate on shoes, then the maritime area cannot avoid being affected adversely.
The hon. member for York-Scarborough (Mr. Stanbury) paid attention to this debate and showed his interest in it. But, this is not just a case of the people from the maritimes crying in the dark. Previously freight rate increases were required to be justified before they were imposed. In the old days, the railways were required to appear before the Board of Transport Commissioners. We were assured by the predecessor of the present minister that nothing drastic would happen and that the study of maritime transportation problems would be completed before any action would be taken which would hurt the maritimes. We spoke in favour of the transportation bill. We brought in many amendments, but we appreciated that in order to have uniform legislation across the country some parts of the country must be hurt. The illustrious predecessor of the present minister gave us certain assurances. I was one of those who tried to point out to the minister why we should vote for this bill in principle, even though we were left unprotected.
It has been only a matter of a few months since the dire predictions were made, and now they have come true. I do not wish to run out the clock, because I know the minister wishes to reply. Perhaps the hon. member for Antigonish-Guysborough (Mr. Stewart) wishes to reply, as well as some other members from the Atlantic area. Hon. members on this side of the house were prepared to go along with the transportation bill on the assurances of the minister. The minister appreciated the fact that the special transportation problems of the Atlantic region required special study. I hope the new minister understands the implication of the remarks made by members on this side of the house. Even the report of the MacPherson commission recognized that the maritime area needed a special study. This report came in, and then before action could be taken on it the railways moved in to cut us off. As I say, this is operation blackjack which will adversely
DEBATES	2791
Rate Structure on Freight on Maritimes affect what has happened in the Atlantic area in the last ten years.
I wish to be non-partisan, but I must say that unless the minister exercises his discretion and individual talent, which sometimes brings forth protests from this side of the house, and changes these less than carload lot rates, the Liberals will become lost in the east. Regardless of what the minister says tonight, members on this side of the house will be anxious to see what concrete action is taken to relieve these immense increases which affect the east. Even though we do not have a great deal of manufacturing, that which we do have will be cut off before it has an opportunity to expand.


Paul Theodore Hellyer: Mr. Speaker, I have listened carefully to the grievance which has been expressed in the house tonight. I must say I have certainly had impressed on me the fact that my new portfolio is a very important one, certainly to the maritime provinces. It may be one that is not any easier than my previous one. I suppose only time will tell. I have also been impressed by the unity of the maritime members in their presentations. I might say, for the benefit of those maritime members on the other side of the house, that those on this side of the house had already made representations to me personally. I appreciate their having done so.


Lloyd Roseville Crouse: I noticed that the hon. member for Antigonish-Guysborough (Mr. Stewart) spoke to you tonight.


Paul Theodore Hellyer: This made it unnecessary for me, under the circumstances, to take up additional time in the house.


Robert Gordon Lee Fairweather: What did you say to
them?


Paul Theodore Hellyer: I said to them the same thing I am going to say to you.


Robert Gordon Lee Fairweather: Priority in due course.


Paul Theodore Hellyer: This has, in fact, been a crash course in respect of transportation and the requirements of the maritimes. It certainly has been an acceleration of my education in respect of this very important subject, and naturally I am grateful for it. I am sympathetic to the needs of the maritime provinces. Notwithstanding what one or two of my hon. friends on the other side said, if one were to examine the statistics one would find that I have taken a number of actions which have
2792	COMMONS
Rate Structure on Freight on Maritimes helped to maintain a very high level of defence activity and employment in those provinces, and certainly a higher level of expenditure than might have been the case if special efforts had not been made.
In so far as the recent rates are concerned,
I should point out that I have not studied them. This has been suggested to me as a matter of priority. When I have studied them, and also the effect of them on industry and consumers in the maritimes, I will be in a better position to assess the implications so far as the growth and development of the maritime region is concerned.
DEBATES	October 3, 1967


Mr. Speaker:: Order, please. It being ten o'clock, it is my duty, pursuant to standing order 56(2) to put the motion now before the house.
Motion agreed to and the house went into committee, Mr. Batten in the chair.


Herman Maxwell Batten: It being after ten o'clock p.m., shall I rise and request leave to sit again at the next sitting of the house.


Some hon. Members:: Agreed.
Progress reported.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Wednesday, October 4, 1967