[Stage Direction]
Mr. A. U, G. BURY (East Edmonton) presented the second report of the select standing committee on standing orders.
Mr. Bury moved that the report be concurred in.
Motion agreed to.

Public Service-Salary Deduction

[Stage Direction]
Mr. PIERRE F. CASGRAIN (Charlevoix-Saguenay) (Translation): Mr. Speaker, I have the honour to lay on the table of the house a petition from the electors of the parish of Beaupre, in the county of Montmorency, praying for government assistance to reopen the pulp mills at Beaupre.


[Stage Direction]
Right Hon. R. B. BENNETT (Prime
Minister) moved:
That a message be sent to the Senate informing their honours that this house has adopted a resolution approving of the international convention for limiting the manufacture and regulating the distribution of narcotic drugs, Geneva, July 13, 1931, signed on behalf of Canada by the plenipotentiaries named therein, and request that their honours will unite with this house in the approval of the abovementioned convention; and that the clerk do carry the said message to the Senate.
Motion agreed to.

Hon. W. A. GORDON (Minister of Labour):: Mr. Speaker, I desire to lay upon the table orders in council numbers 847, 848 and 849 passed under the authority of the Unemployment and Farm Relief Continuance Act,
1932.



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
Hon. R. J. MANION (Minister of Railways and Canals) moved that the house go into committee at the next sitting to consider the following proposed resolution:
That it is expedient to provide for an extension of time from 31st August, 1932, to the 31st August, 1934, for the construction or completion of certain branch lines of railway of the Canadian National Railway Company, authorized by chapter 19, 20, 21, 25, 28, 29, 30, 32, 33, 34, 35 and 36 of the statutes of 1929.
He said:	His Excellency the Governor
General, having been made acquainted with the subject matter of this resolution, recommends it to the favourable consideration of the house.
Motion agreed to.

Hon. E. N. RHODES (Minister of Finance) :: Mr. Speaker, this notice of motion
appears inadvertently upon the order paper; the bill which it is proposed to introduce does not require notice and this matter should have appeared under the heading of "Introduction of Bills." Therefore, I move that this order be discharged, following which I shall ask leave of the house for permission to introduce a bill.


[Stage Direction]
Motion agreed to.
Edgar Nelson Rhodes: As in the ordinary course the notice would have appeared under the heading of "Introduction of Bills," I ask permission of the house to introduce the bill at this stage. I move for leave to introduce Bill No. 45, respecting the export of gold.


Mr. MACKENZIE KING:: Explain.


Edgar Nelson Rhodes: This is to provide in the form of an individual statute for making possible the practice which obtained in recent months, and with which hon. members are familiar, and also that pertaining to the export of gold during the war period.
Motion agreed to and bill read the first time.



THE PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
William Lyon Mackenzie King: May I ask the
government whether any order in council has been passed authorizing a deduction of ten per cent of the salaries of civil servants from this month's cheques, which, I understand, were issued this morning?


Edgar Nelson Rhodes: The order in council has not been
formally passed, but instructions were given that the deduction be made in preparing the cheques. It was thought, although there was not legislative authority for this course of action, far less hardship would be worked than would be the case if the cheques were issued for the full sum and a double deduction had to be made at a later period. A further circumstance to be borne in mind is that the estimates were prepared in anticipation of this salary deduction.


William Lyon Mackenzie King: If I understand the Minister of Finance aright, there is no legislative authority for the action taken?


Edgar Nelson Rhodes: No.


William Lyon Mackenzie King: What then is the necessity of Bill No. 19 which is at present on the order paper? If the government

Public Service-Salary Deduction
can act without legislative authority in deducting ten per cent of the salaries of civil servants, why go through the pretence of passing an act?


Edgar Nelson Rhodes: I may say that the course pursued is not without precedent. I have reference particularly to a case as far back as 1S97, when the government of the day at that time withheld statutory increases without legislative authority and, I think, without sanction by order in council. But I must point out to my hon. friend that although I know technically parliament has not as yet passed the bill dealing with the deduction, there is the circumstance an interim supply bill was passed providing for only the amount less ten per cent.


William Lyon Mackenzie King: The Interim Supply Bill was one for two months so that so far as it is concerned, there was no necessity for making the deduction. I appreciate the inconvenience that has been mentioned by my hon. friend and that might be occasioned by complying with the law, but the law is there and should be complied with. The position that we are in at the moment is that the government has assumed to act in the matter without any power from parliament. Bill No. 19, to provide for the deduction in compensation in the public service has received its second reading, but it is still in committee; it has not yet passed the Commons; it has not gone to the Senate and it has not received royal assent. My hon. friend knows that until a bill has passed both the Commons and the Senate and has received royal assent, it is not law and no action can be taken under it. This action has been taken without any legislative authority and it is simply substituting the directions of the ministry for the authority of parliament.


Edgar Nelson Rhodes: I must respectfully beg to differ from my right hon. friend. The governing factor is the voting of the money. Even if Bill No. 19 were passed, not a dollar could be paid to the servants of the crown unless and until the supply bill was passed, so that in the last analysis we must lean upon the Interim Supply Bill which takes distinct recognition of the fact we are proposing that salaries this year shall have a deduction of ten per cent.


William Lyon Mackenzie King: The governing factor is the authority of parliament and it has voted for the public service money amply sufficient for a complete payment of the civil service this month.


Mr. GUTHRIE:: No.


William Lyon Mackenzie King: The Interim Supply Bill was for two months.


Hugh Guthrie: Of the estimates as printed.


William Lyon Mackenzie King: The fact that parliament voted an interim Supply bill in order to oblige the government is no reason why the latter should ignore parliament in the matter of following the procedure which is essential in all these affairs. I do not wish unduly to labour the point, but certainly one of the obligations devolving upon the leader of an opposition is to see that the rights of parliament in the matter of legislation are respected, and I cannot agree with my hon. friend as to there being any precedent which he could cite as authority for saying that the action which has been taken is legal. It is, I think, both arbitrary and illegal, and I repeat it is another instance of where the authority of parliament is superseded, not even by the sanction of the ministry as expressed in an order in council, but apparently by the will of the ministry as expressed in a mere verbal order.


Edgar Nelson Rhodes: I do not know that any
advantage will arise by an attempt on the part of my right hon. friend and myself to have the last word. Of course when the Interim Supply Bill was passed, my right hon. friend, as was quite right and proper, made the reservations usual in such cases. It was made very clear, and the record will show, that his having assented to the Interim Supply Bill does not commit him to the principle and leaves it open to him to discuss the estimates in full in precisely the same manner as if the Interim Supply Bill had never been passed. But I submit that the governing factor is the voting of the money and as I have said, the Interim Supply Bill gave specific recognition to the fact that the amount available covering the period of a year was to be made available to the extent of the ordinary sum for salaries, less the deduction of ten per cent. Under those circumstances I submit that not only is. the course we took proper and in conformity with the law, but it is the one that in the long run will cause least inconvenience to members of the public service.


William Lyon Mackenzie King: This also is
not by way of having the last word, but I assume the same course will be followed with respect to indemnities of members of parliament, including members of the House of Commons and members of the Senate?


Edgar Nelson Rhodes: Yes.

Supply-Trade-Grain Act


William Lyon Mackenzie King: I submit this
is not treating members of the House of Commons as they should be treated in this matter until a bill is finally passed, but we may waive that point. So far as members of the Senate are concerned, they at least might have had an opportunity to be heard as to their wishes and will in the matter of their indemnities before action was taken by the government.


Edgar Nelson Rhodes: I feel it incumbent upon
me to say one word in connection with the last remark of my right hon. friend. Members of the House of Commons, in voting for the second reading of the bill, have consented to the reduction in the case of their own salaries. Furthermore I may point out that members of parliament are not paid monthly; they receive an indemnity for the session. It is true they are able month by month to draw a certain amount based upon a per diem allowance, but the fact is that the deduction will be taken care of when hon. gentlemen come to the point where there is remaining at the end of the session a margin of only S400.


Mr. STEWART (Edmonton):: The final
payment.


Mr. POWER:: Will the deduction be made to apply to the militia?


Edgar Nelson Rhodes: I am speaking without
reference to the documents, but I would assume not.


William Lyon Mackenzie King: May I ask my hon. friend if the deduction has been made in the salaries of the lieutenant-governors and judges? I understand that that matter is under consideration. If the deduction has not been made, how wall it be possible to make it later seeing that the interim supply bill has been assented to?


Edgar Nelson Rhodes: I was not aware, Mr. Speaker, that this question would arise to-day, and I am therefore unable to answer my right hon. friend, but I will do so to-morrow.



RETURNED SOLDIER LEGISLATION

[Stage Direction]
On the orders of the day:
Mr. CAMERON R. McINTOSH (North Battleford): May I ask the Minister of Pensions and National Health if after further consideration he is now in a position to inform the house and the country whether the government will bring down this session any new or amending legislation concerning returned men?
Hon. MURRAY MacLAREN (Minister of Pensions and National Health):: I expect to be able to give my hon. friend an answer early next week.



CQAL-FREIGHT SUBVENTION

[Stage Direction]
On the orders of the day:
Hon. J. L. RALSTON (Shelburne-Yarmouth) :: I want to call the attention of the Minister of Mines to the fact that the allrail coal subvention under order in council expires, I think, to-day. I would ask the minister if he is in a position to announce what action the government will take in this matter of coal subventions. If not, will the government continue the coal subvention pending a decision as to any further action which the government proposes?


Wesley Ashton Gordon: The whole question of subventions in connection with the coal industry is under consideration at the present time. I do not need to assure the hon. member for Shel-burne-Yarmouth that the problem presents great difficulty. The intentions of the government will in due course be made manifest when action is taken.



DEPARTMENT OF TRADE AND COMMERCE

[Stage Direction]
The house in committee of supply, Mr. Hanson (York-Sunbury) in the chair.
The Canada Grain Act, including management. operation, maintenance and equipment of elevators, administration of, $2,400,000.
Mr. POULIOT:: May I ask the minister what proportion of our total export of wheat goes to Great Britain as compared with the rest of the world?


Hon. H. H. STEVENS (Minister of Trade and Commerce):: I can give those figures in a moment.
Mr. POULIOT. I shall be glad to get them.


Henry Herbert Stevens: I will supply that information to my hon. friend.


Mr. DUFF:: The other evening when we
were discussing this item I asked the minister if he would tell the committee what was the policy of the government with reference to the shipment of grain through the port of Halifax. Another question I asked was, what quantity of grain had been shipped from the port of Halifax and the port of St. John in the last three years. This is a very important matter especially for the port of Halifax, in which of course I am more interested than in St. John, and I would like the minister to give the committee some statement in regard to that matter.
Supply-Trade-Grain Act


Henry Herbert Stevens: The export of grain
through the ports of Halifax and St. John for the last three years has been as follows:
Halifax	St. John
Number of Number of bushels shipped bushels shipped
1929-	30.	.	.	16,639	4,357,7881930-	31.	.	.	....	11,079,3251931-	32.	.	.	838,371	3,061,323
I have not the figures under my hand of shipments through the ports of Montreal and Quebec. The question of the export of grain from the Atlantic ports in the winter concerns only the ports of Halifax and St. John after navigation has closed at Montreal. It must be borne in mind that the grain trade of Canada is carried on by private corporations, and once the grain is bought on the Winnipeg market, which, of course, is the large central market in this country dealing with grain, it passes into the hands of the owner who directs its movement as he considers to his own advantage. The movement of grain from Port Arthur and Fort William at the head of the lakes is to certain points in the east which best suit the purposes of the exporter. Some of the grain is moved to Buffalo, some to Port Colborne and other lake ports, or Montreal, as the case may be, and it is there held to the order of the owner. The owner may direct its export, in the case we will say of grain at Buffalo, either through American or Canadian ports at his own option, over which, of course, we exercise no authority or control. There are certain economic factors which enter in at the ports of Boston, New York and Portland, and at one or two other ports to a lesser degree. There is always a great deal of shipping offered with what is known as distress space, and frequently the owners of grain take advantage of the distress rates and contract for shipment through those ports; or it may be that the destination of the grain in Europe calls for shipment through ports other than Canadian, in the opinion of the owner of the grain. The movement of the grain is thus wholly in the control of the owner of the commodity. As far as the government is concerned, and I think what I say of the present government is true of preceding governments, all facilities possible for the handling of the grain have been provided in Canadian ports and will be provided as required in the future so far as possible. The influence of the government is used, so far as it is consistent with the movement of trade generally, in the direction of trade through Canadian channels. We have considered and will consider any suggestions which may be made which will facilitate the movement of grain in such channels. I would impress upon

the committee however that the grain is in the hands of the owners of the commodity who, naturally, direct its movement through such channels as they may consider desirable.
There is one other point to which I wish to draw the attention of hon. members. A great deal might be done to increase the movement of grain through Canadian channels if at the point of export or point of shipment there was a larger body of commercial interests connected with the movement of grain through that port. That is, if there were business concerns operating at these points, as there are at other older and more established points, who were interested in the movement or handling or direction of grain, the results would be more satisfactory. Only recently I drew the attention of business concerns in eastern Canada to the desirability of securing an increased interest on the part of Canadian business men concerning the movement of the Canadian crop, which forms such an important part of our export business.


William Duff: Mr. Chairman, I am sure the committee has listened with great interest to the remarks of the Minister of Trade and Commerce. Had I shut my eyes I should have thought I was back in the session of 1930; the then Minister of Trade and Commerce of that day was asked certain questions when complaints were made regarding this very question. I am sure the minister's man}' friends must have been delighted to hear him make the speech he has just made. I do not know however how some of my Conservative colleagues from the province of Nova Scotia took it, because they will remember that during the sessions of 1926, 1927, 1928, 1929 and 1930 the Minister of Trade and Commerce and the former government were bombarded -and properly so; I am not objecting at all

were properly bombarded by members representing constituencies in Nova Scotia who complained very bitterly that the government of my right hon. friend, the present leader of the opposition, had failed to see that grain went through the port of Halifax. In fact Conservative newspapers in the province of Nova Scotia referred to the elevator, which the late government had been instrumental in building, as a pigeon roost. The statement was made that very little if any grain was passing through the port, and of course the government of that day was blamed.
I noticed however the statement which the minister read with regard to the quantity of grain passing through the port of Halifax in the last two years, or since the present government took office. It would seem that since my friends from Nova Scotia have taken seats

Supply-Trade-Grain Act
on the government benches conditions are worse than they were when the late government- was in power. I need not go into this matter, but I may say that the minister's explanation, that to a great extent the matter is in the hands of the shipper, is quite right. I have always contended that, and there is no question about it. The fact is however that gentlemen who now are members of the government, or members supporting the government, told us two or three years ago that that was not correct, and that if they were put into power, if they were placed on the seats of the mighty, they would see that this condition was changed and that grain would flow through the ports of Halifax and St. John. There was no question about it. Not only in the newspapers but on the public platforms hon. gentlemen now sitting opposite made the distinct statement that the then Liberal government should be turned out of power and that the Conservative party should be given a chance to see that grain flowed more freely through the ports of Halifax and St. John. We wTere told of course that the Transcontinental railway was built for this special purpose, and the name of my late respected chieftain, Sir Wilfrid Laurier, was brought into the discussion to show that when he and his government decided to build the Transcontinental railway the decision was made to fulfil the special purpose to which I am now referring. My hon. friends urged that the government led by the present leader of the opposition was not doing its duty by the people who had grain to ship, or to those people in the cities of St. John and Halifax, when they did not see that greater quantities of grain went through the ports of those two cities.
Now, Mr. Chairman, birds will come home to roost, even if they are pigeons sitting on the elevator at Halifax. I can understand why the Minister of Trade and Commerce hangs his head because, after sitting in this house from the years 1926 to 1930 and listening to his colleagues complain to the then government of what a terrible thing it was that these people of the maritime provinces were not receiving their maritime rights, he may well hang his head. We heard a great deal about one hundred per cent maritime rights. If the late government did not give one hundred per cent maritime rights, what has the present government done with regard to the shipment of grain through the ports of Halifax and St. John? The figures given by the minister only a few moments ago supply the answer, and in that connection I need not say very much more.
My right hon. friend the Prime Minister must have thought the matter important when he made his speeches during the election campaign of 1930. Of course, perhaps he was not reported correctly. Sometimes we find, when we read extracts from speeches supposed to have been made by the right hon. gentleman, that they were not correct, because perchance, a mistake had been made by some cub reporter. I have before me however what the Prime Minister is reported to have said in the Forum at Halifax on July 3, 1930, just a few days before the election. At that time the people at Halifax were urged to turn the government out of office because of their treatment of the people of Nova Scotia with regard to the shipment of grain, and for other reasons. But they were told something further. At that meeting the Prime Minister made a distinct promise to the people of Nova Scotia and the maritime provinces. What was he reported as saying? I quote as follows:
Speaking at the Forum at Halifax on July 3, 1930, Mr. Bennett said it was his "determination to force Canadian traffic over Canadian territory and through Canadian ports and to make this country commercially independent of the United States."
He was going to blast his way. I do not know whether he intended to blast the mountains through which the railway passed when coming from Winnipeg, but certainly he was going to do another blasting act so that grain might go through Canadian ports.
What has my right hon. friend done since he made that speech on July 3, 1930? Has he done anything for the ports of Halifax and St. John? I will come to that in a minute. Quoting again:
He said the development and equipment of the port of Halifax as a great national port was "essential to meet the competition from the United States ports of the Atlantic seaboard and to give maritime ports every advantage in low rates to attract traffic both inward and outward."
What has my right hon. friend or his colleague the Minister of Trade and Commerce done to obtain lower rates on grain through the ports of Halifax and St. John? During the last two years, what have they done? The minister gave us the answer only a few minutes ago; he told us of the infinitesimal quantity of grain which had passed through either the port of St. John or Halifax since hon. members opposite came into power. Quoting further:
He further declared that "his consideration was the welfare of Canada and Canadian ports -United States ports were not his concern; the people of that country were quite capable of looking after their own interest."



Supply-Trade-Grain Act
Yet, in spite of that statement-and no doubt that statement was made to get votes in the city of Halifax for my two hon. friends who represent that city-


An hon. MEMBER:: And who are not in
the committee.


William Duff: It does not matter. The fact
remains that the Prime Minister made that statement, I will not say deliberately, Mr. Chairman, because you might call me to order; but the Prime Minister, according to the newspapers, is reported to have said that if he and his government were elected he would see that grain would flow more freely through the port of Halifax, and, of course, through St. John. But since that date this government has done nothing. The minister himself admitted a moment ago that, unlike his leader, he was not concerned about freight going through the American ports; he said it was impossible to keep it from going through American channels. And he is quite right. But the Prime Minister did not give the electors of Halifax that understanding. He virtually said to them, "Elect me and my government and we will see to it that the elevators in Halifax and St. John will be full of wheat all the time; we will see that wheat will be flowing through these ports to foreign markets." Let us see whether they did anything else with regard to this great question.
In 1928 there was a meeting of the maritime board of trade at Moncton and I believe that at that meeting that board of trade, owing to the fact, I have no doubt, that they thought that the then government were not perhaps doing things as quickly as they should, and were not seeing that the maritime ports were being used properly, passed a resolution which reads:
1. That the National Transcontinental railway was constructed for the purpose of creating a route to Halifax and St. John that would provide for, among other matters, the transporting of Canada's exportable surplus of grain through the ports of Halifax and St. John at rates that would not exceed those to other
north Atlantic ports.
2.	That an all-rail rate of 19-34 cents per 100 pounds as requested in this application is necessary in order that the National Transcontinental railway be used for the purpose for which it was constructed.
3.	That the board did, in general order No.
448, dated August 26,	1927, recognize this
matter as one of national importance and directed the Canadian National Railways to publish an export rate, on grain, of 18-34 cents per 100 pounds to Quebec city. This order was complied with by the publication of C.N.R. tariff No. C.G. 93. G.R.C. No. E1268.
4.	That the same conditions and circumstances surround the extension of the export rate on

grain to St. John and Halifax as applied in the decision of the board with respect to the rate to Quebec city.
5.	That, in view- of the national importance of this matter, we would respectfully urge that it is expedient that this matter be given immediate attention by the board.
I am reading a resolution contained in a speech delivered Iby the hon. the junior member for Halifax (Mr. Quinn) in the year 1928 when the late government was in power. I am not going to quote from the hon. gentleman's speech or recite his complaints with regard to the little -that had been done by the Liberal party. I do want however to back up what the hon. gentleman said on that occasion, because now his own government is in power. He has been supporting that government since 1930, nearly two years, and I have not heard either him or the senior member for Halifax say one word with regard to this very important matter.
Now the Liberal government did try to arrange this matter; they did endeavour to arrange for a differential rate of one cent per bushel. But they found, when they addressed themselves to the railway commission, that the commission indicated they could not do it unless legislation were enacted with respect to the question. The matter was referred to the government, and my right hon. friend the Prime Minister has evidently forgotten the speech he made in the city of Halifax on July 3, 1930, inasmuch as he wanted to refer the matter to the Supreme Court of Canada. Instead of dealing with it as a government he wanted to pass the buck and refer the question to the courts. But now that this matter has again been referred to the government, the final arbiter, it has been or should have been before them for a number of months; and so far as the public and this parliament know, nothing has been done by the government to settle the question one way or the other, to see that a different rate is given whereby more grain can flow from the prairies through the ports of Halifax and St. John.
I say the government has been derelict in its duty in not settling this important question one way or the other, so that the people of Nova Scotia and New Brunswick may know exactly whether or not something is going to be done in their interests. All we have at the moment is the report of Sir Alexander Gibb. 1 dare say it was all right, and I am not complaining, to bring this eminent gentleman here to look into questions affecting the harbours of Canada; but I do say that Sir Alexander Gibb's report is not satisfactory to five per cent of the people of Canada interested in our different ports from Vancouver to Halifax.

Supply-Trade-Grain Act
Now what does Sir Alexander Gibb say about the port of Halifax? Surely the government might have given him some lead as they did when another commission sat in this country with respect to other matters. We remember that it was rumoured, when the Duncan commission was sitting, that the commission was given a hint that they were not to touch the tariff. Surely the Minister of Trade and Commerce (Mr. Stevens), if he is interested in his capacity of minister in charge of this deipartment, must have been taken into the confidence of Sir Alexander Gibb or taken him into his confidence. But if he was not taken into that gentleman's confidence it was the duty of the minister to see Sir Alexander before he made his report and give him his own views and ideas regarding this matter. What did Sir Alexander Gibb report so far as Halifax was concerned? He practically says that it is impossible to ship grain through the port of Halifax; it is even impossible, he says, to ship heavy freight through that port-and this notwithstanding the fact that the Conservative government in 1914 spent $35,000,000 on that port, and the fact that during the last seven and eight years, and especially during the time that the Liberal party was in power, other millions were spent developing the port of Halifax. Yet Sir Alexander Gibb now comes along and declares that it is impossible to ship heavy freight through that port. All that the people of Halifax and Nova Scotia can expect from his report is to have a few passengers land at that port from time to time.
1 say that the government should come to a decision promptly with regard to this question. Let the people of Halifax and Nova Scotia know what is going to be done. Let the citizens of Canada, who have spent tens of millions of dollars developing the port and getting it ready for the grain trade and other heavy traffic, know whether Sir Alexander Gibb's recommendation will be accepted, or whether the government will find means to send grain through the ports of Halifax and St. John.


Mr. ILSLEY:: I wish to say a few words
on the subject that has been discussed by my hon. friend (Mr. Duff). I have not the documents before me, but my recollection is that a very important decision of the Board of Railway Commissioners was given on October 28, 1930. An application had been made by the Halifax harbour commission and the transportation committee of the maritime board of trade for a one cent differential, so-called, over the Quebec rate. That means this. There was, prior to 1927, a rate from the 41761-129J
head of the lakes ports to the city of Quebec of 34-5 cents per hundred pounds, and a rate to the maritime ports of 35-5 per hundred pounds, one cent higher. Now certain interests in the city of Quebec, or the city, applied to the Board of Railway Commissioners and had the 34-5 rate reduced to a rate of 18-34. Thereupon an application was made by the bodies I have mentioned-that is, the Halifax harbour commission and the transportation committee of the maritime board of trade-for a rate from the head of the lakes ports to maritime ports of 19 - 34 cents per hundred pounds, preserving the one cent differential. The Board of Railway Commissioners decided against the applicants. I believe their decision was given about October 28, 1930. Some months later a petition was lodged with the governor in council requesting a variation or rescission of the decision of the board, under the section of the act which enables such action to be taken by the governor in council. These proceedings ordinarily are called an appeal to the government from a decision of the board of railway commissioners, but I do not think the word "appeal" is the correct term. I think it gives a wrong impression, because the action taken by the governor in council is not judicial; it is administrative or executive.
However, as I say, this so-called appeal was lodged about the end of May, 1931, if my recollection serves me aright, and the matter then came before the government. I submit that the government should have taken reasonably prompt action, especially in view of the very definite undertakings given by the Prime Minister in Nova Scotia during his preelection campaign. The government permitted a long time to pass, from June to November of 1931, without taking action. Then in December a very strong letter was written the Prime Minister, signed:
In behalf of the government of Nova Scotia: Percy C. Black,
Acting Premier.
In behalf of the city of Halifax:
George E. Ritchie,
Mayor.
In behalf of the municipality of Halifax county:
R. A. Brenton.
Warden.
In behalf of the Halifax Board of Trade: A. N. Jones,
President.
In behalf of the Dartmouth Board of Trade: E. J. Butcher,
President.
In behalf of the town of Dartmouth: Walter Mosher,
Mayor.

Supply-Trade-Grain Act
In behalf of the Halifax Commercial Club:
0.	R. Crowell.
President.
In behalf of the Halifax Rotary Club:
W. E. Tibbs,
President.
In behalf of the Halifax Progressive Club: J. V. Worth.
President.
In behalf of the Halifax Gyro Club:
G.	M. Stultz,
President.
In behalf of the Halifax Kiwanis Club:
H.	W. Kirkpatrick,
President.
That letter was dated December 10, 1931. It is a little too long to read in full, otherwise I should like to place it on Hansard. It states that this matter is of vital and urgent concern to these communities and to the province of Nova Scotia as a whole. The letter states:
One of the most immediate needs of the port of Halifax, and the channels of transportation of which it is the terminus, is a fair share of the movement of the Canadian grain crop. This need is twofold:
1.	To increase the volume of traffic through the port; and
2.	To provide the port with an adequate amount of grain for use as ballast cargo.
Then follow a number of very striking facts showing the large proportion of Canadian grain going through United States ports. Then the letter goes on to discuss the Quebec rate, which I have already mentioned. It says:
Prior to 1927, the grain rate over the Transcontinental, per 100 pounds from the head of the lakes, was as follows:
Cents
To Quebec	 34-5
To maritime ports	 35-5
Quebec applied for and secured a reduction of this rate to 18-34 cents per 100 pounds. And in its general order No. 448 the Board of Railway Commissioners for Canada directed the railway to publish this reduced rate over the Transcontinental to the port of Quebec.
On two occasions the railways attempted to upset this rate, once before the board of railway commissioners, and again before the Supreme Court of Canada. Both attempts were unsuccessful. The application of the C.N.R. for leave to appeal from the judgment of the board was dismissed by that body in July, 1929; and in the Supreme Court of Canada, Mr. Justice Lamont, shortly after that date, also dismissed an application of the C.N.R. for leave to appeal from general order 448.
Meanwhile, an application had been made to the board of railway commissioners for an extension of the "Quebec rate" (plus the usual 1 cent differential) to the ports of Halifax and Saint John. This application, and the facts supporting it, were in every particular similar to the application and the facts pertaining to the Transcontinental railway in its relation to the port of Quebec, but certain members of the railway board, having granted the Quebec
[Mr. Ilsley.l
application, reversed their position and denied the maritime application. The result is that the rate on grain and grain products over the Transcontinental from the bead of the lakes to maritime ports is approximately twice the rate to the port of Quebec.
The bodies making the unsuccessful application-the Halifax Harbour Commission and the Transportation commission of the Maritime Board of Trade-are carrying this case on appeal to your government, in the confident hope of securing a reversal of such an unjust and discriminatory action.
The port of Halifax is equipped immediately to handle twenty millions of bushels of grain during the shipping season. Established at this port is a modern elevator with a storage capacity of 2.200,000 bushels, but this elevator lies idle so far as the Canadian export grain traffic is concerned, and little or no Canadian grain comes over the railway lines into and through this province.
It is unnecessary here to attempt an _ enumeration of the benefits, direct and indirect, that would be derived by our own people from a substantial share of the grain traffic of the country. At this time, when unemployment is such a serious problem, the provision of more jobs for workers on our railways, in our mines and along our waterfront, to say nothing of the stimulation of other forms of industrial and commercial activity, would justify an unusual effort to hold the trade of Canada in Canadian channels.
The chairman of the Halifax Harbour Commission has stated his belief that the port of Halifax has just about reached the limit of its development unless an adequate share of the Canadian grain traffic can be secured, for, manifestly, it is going to be difficult, if not impossible, to develop any turn-around movement of liner tonnage under existing conditions.
In these circumstances, so vital not to this port and province alone, but to the dominion, as a national matter, we respectfully urge an early hearing of the appeal in the Transcontinental grain rates case, _ and a favourable decision in the interests of our own transportation channels. We realize the heavy burdens and great complexities involved in public administration in this country to-day. but we are confident that, appreciating the urgency of this matter from the standpoint of our national well-being, you and your government will give it early and effective attention.
Yours respectfully,
Then follow the signatures of the gentlemen I have named. After that letter was written the appeal did come on for hearing before the government, according to newspaper despatches, but so far as I have been able to learn as yet it has not been disposed of.
I submit to the minister that there can be no justification for these almost interminable delays in dealing with a comparatively simple matter. First we had the delay from last spring until January before the appeal came on for hearing at all, and we have had the delay month by month ever since. The question of the principles that should guide the government in dealing with these appeals was

up for discussion in committee of the whole two or three times last year. It has been laid down, and I do not think it can be denied, that the government are not acting as a court and are not setting precedents that can be applied to other cases. They are not bound by the ordinary rate-making principles which bind the Board of Railway Commissioners. The very object of the section is to enable them to put policies into effect, and the policy of the government as announced before the election was to stimulate the flow of grain through Halifax.
The promises .made by the Prime Minister have been read by my hon. friend from Antigonish-Guysborough. Why does not the government act in the matter? That is the question I should like to direct to some responsible minister of the crown. If they have decided in their own minds not to give effect to the appeal why do they not courageously say so? Why keep this matter dangling and pending for these long periods? That is the question the people of Halifax and the people of Nova Scotia would like answered. The case for the application of the one cent differential has been placed before the government very strongly by the Halifax harbour commissioners, and by the transportation committee of the .maritime board of trade. The people of the province now await some action which will implement the very definite promises and undertakings given iby the Prime Minister prior to the elections of 1930.


Henry Herbert Stevens: Mr. Chairman, the two hon. members who have very forcibly presented this matter no doubt have done so in perfect good faith, and with -much of what they have said I am in entire sympathy. There is no question at all that it is highly desirable, as far as it is humanly possible to do so, to encourage the movement of grain and other cargoes through Canadian channels.
The hon. member who has just taken his seat has said that this is a simple matter which could .be disposed of by a "yes" or "no", but I am quite sure that he and his colleague from Antigonish-Guysboro would much prefer that the matter should be delayed rather than an adverse decision given immediately. That there has been delay is without question; the facts are there and I have intimated already to the committee some of the factors which enter into this problem. I am not prepared at the moment to discuss fully the broad general question, but I can say that the department has been carrying on an extensive study of this matter. The more I study it, the more I find to support the view that perhaps some extensive steps can be taken to
15, 1932	2053
Supply-Trade-Grain Act
increase the movement of import and export business through our Canadian ports. I think those .who have studied this question will agree that it involves matters of high policy, using a term which is often used, and I am not prepared at the moment to state my own opinion. We are carrying on an intensive study which involves a tremendous amount of analysis of the movement of goods coming into and going out of Canada, grain being the principal export commodity.
That the question is a simple one, I cannot agree; it is an exceedingly complicated and difficult matter with which to deal. It does not follow that we should sit idly by and do nothing, and in that respect I agree with my hon. friends and do not quarrel with their impatience in this matter. I have received many communications from Halifax, St. John and other parts of the maritime provinces both from individuals and different bodies, to all of which I have given a measure of answer. However, I can go no further at the moment than to say that as far as the particular appeal to which my hon. friend has referred is concerned, I think it is desirable that at the moment the door should not be slammed. I would advise and counsel further consideration before this question is disposed of. In regard to the larger question which in my opinion involves important matters of policy, the time for solution has not yet arrived and as far as I am concerned, I am not prepared to give a definite opinion. I can assure the committee that this matter is receiving the very best attention which my staff, members of the government, and myself can give.


James Layton Ralston: Mr. Chairman, I think the committee, particularly those members from the maritime provinces, welcome the statement of the minister that this matter is under consideration, but I, for one, am filled with a great deal of apprehension at the rather ominous suggestion made that perhaps we would prefer to have delay in this matter rather than to have the door slammed at once in our face.


Henry Herbert Stevens: I was referring to the one point, namely, that an immediate decision should be given in connection with the appeal made by the hon. member.


James Layton Ralston: That is the point with which I am dealing. After the strong appeals made by the hon. members for Antigonish-Guysborough (Mr. Duff) and Hants-Kings (Mr. Ilsley), I hesitate to press this matter any further, but in the hope that something
Supply-Trade-Grain Act

I may say may have some influence upon the minister, I desire to say a word or two on the subject.
The minister says that this matter is not simple, but to my mind the only element of complication is the argument which has been made quite frequently to the effect that it will in some way cause a reduction in the tariffs of the American roads and thus lead to no practical effect. That is perhaps the strongest argument or is at least the statement most frequently made in opposing this rate. The Board of Railway Commissioners reduced the rate per hundred pounds on wheat moving from Port Arthur, Fort William, West Fort William and Armstrong to Quebec from 344 cents to 18-34 cents per hundred pounds. This action was taken regardless of possible clashes with American roads, and the order was issued on August 26, 1927. I had the honour to represent the maritime board before the railway commission, on first general freight rate hearing, and I supported the application then made by Quebec but asked that the same rate be extended to Halifax and St. John with the addition of a one cent differential. Before any decision was given the Duncan commission intervened and as a result of its finding the Maritime Freight Rates Act was passed. That disposed of most of the matters in the general freight rates investigation. The grain rates were subsequently discussed again before the Board of Railway Commissioners. I was not representing the maritimes on that hearing as I had become a member of the government. The order w'as granted for Quebec but no order was made so far as Halifax and St. John were concerned. I would point out to the committee that at the time of the application to the board, there was in existence a grain rate from these western points of Port Arthur, Fort William, West Fort William and Armstrong to Quebec which was just one cent less than the grain rate to St. John and Halifax; in other words, there was a differential of one cent in the rates to these ports. I cannot see any complication in this matter. All that the maritime provinces are asking for is a continuance of this differential of one cent between the Quebec rate and the St. John and Halifax rate.
Under the terms of the order Quebec now has a rate of 18-34 cents per hundred pounds, and unless an adjustment is made it will mean that Quebec will have a rate of 18-34 cents as compared with the rate of 354 cents to Halifax and St. John whereas the previous rates were 344 cents to Quebec and 354 cents to St. John and Halifax.


Mr. VENIOT:: Quebec is not a winter port.


James Layton Ralston: The Halifax harbour
commissioners in June, 1928. applied to the Board of Railway Commissioners to reopen the matter and grant the lower rate to Halifax and St. John to correspond with the new Quebec rate and the maritime board of trade joined them. The matter was heard and in October, 1930, the board dismissed the application and in April, 1931, the present Halifax harbour commission appealed the case to the governor in council. There should be no complication in deciding that the old differential should apply; if the rate has been reduced to Quebec, then it should be reduced correspondingly to St. John and Halifax. This is all the complication there is and it is all the government has to determine. I desire to compliment both the old Halifax harbour commission and the new commission and the maritime board of trade on the excellent way in which this case has been presented, both to the Board of Railway Commissioners and to the governor in council. I have before me the brief, dated April 10, 1931, which was presented by Colonel Phinney, chairman of the present Halifax harbour board, to my hon. friend and his colleagues in the government. Included in that is the application which was presented by Mr. Peter R. Jack, former chairman of the Halifax harbour commission, under date of June 7, 1928. That appears on page 27 of the brief.


Henry Herbert Stevens: What is the date of
Colonel Phinney's petition?


James Layton Ralston: April 10, 1931. That petition of Colonel Phinney contains a very complete statement of the orders in council, the action which had been taken by the Board of Railway Commissioners and other bodies, the arguments which have been submitted from time to time and the proceedings which have been had in an endeavour to have this low grain rate established to St. John and Halifax, that is to say, after the Quebec rate was established, to get this rate put on a basis corresponding with that to Quebec. It is as complete a. case as I think it has been my privilege to see presented. I want to urge on my hon. friend and his colleagues in the government, in spite of the numerous duties they have, a study once more of that brief which was presented, I think at least six or eight months ago; and by that I mean favourable consideration, not merely a study for the purpose of coming to the conclusion that the application cannot be granted. Let me say to my hon. friend that the rate differential is the whole point involved. I am

Supply-Trade-Grain Act
not going to take up the time of the committee in discussing the merits of the ports of Halifax and St. John or their value to Canada as national ports. That has been discussed before; it is set out fully in the brief and it is only because of the fact it is so fully presented that I do not go into it to-day again.
I should like, however, to make this further point, that Sir Alexander Gibb's report, which has just been presented to parliament, is, as regards its reference to the port of Halifax, a very great disappointment, I can assure my hon. friend, not on political grounds, to all parties who are interested in the development of the port, and who realize its importance as the eastern gateway not only during the winter months but all the year round. My hon. friend will realize this when he reads in the public press of the last week or two statements by Colonel Phinney, the present chairman of the Halifax harbour board, Mr. Jack, the former chairman, and by Colonel Jones, president of the Halifax board of trade. Their statements will repay study by my hon. friend when he is considering the matter of grain traffic through Halifax. In Sir Alexander Gibb's report there has been some suggestion that Halifax may as well forget grain as a source of traffic through that port. The arguments which those gentlemen present, both in the brief to which I have referred and in the statements which they have made, as reported in the press, make it abundantly clear that, with all due deference to Sir Alexander Gibb, he has not grasped, either the local- or the national importance of Halifax as a grain port.
My hon. friend refers to the desirability of having commercial interests take part in the forwarding of grain to the eastern ports. An assiduous effort has been made by both the former harbour commission and the present one, I know, to interest shippers in using Canadian ports. I believe Halifax and the maritime provinces have done all they reasonably could be expected to do and it is useless for them to attempt to attract grain through Canadian ports in any large quantity at freight rates which are so much out of line with those which have been put into force to Quebec. Therefore I come back again to ask my hon. friend with his colleagues to consider favourably the application on appeal which has been made from the decision of the Board of Railway Commissioners and to give a prompt decision allowing that application.


Mr. CANTLEY:: In the absence of the
senior member for Halifax (Mr. Black), perhaps it is incumbent upon me to remind the
house that within the last forty-eight hours there has been handed to the government a communication signed by all the Conservative senatprs and members from the maritime provinces asking it to put into force the rate referred to by the hon. member for Shelburne-Yarmouth (Mr. Ralston) who has just sat down, that is 19-34 cents per hundred pounds to Halifax and St. John. As to what effect such rate, if adopted, would have, I do not know, but I may say that I have some doubt whether, if that rate were applied, any con- ' siderable quantity of grain would be shipped from those ports. My doubt is due to this fact: a large proportion of the grain that is shipped through the port of New York is carried -by the large liners. Why is that so? Simply because those large transatlantic boats, coming in and sailing as they have to do, on schedule time, must, due to their great superstructures, be given considerable quantities of dead-weight ballast and the most convenient type of dead-weight cargo they can obtain is grain. In former years, when the United States were shipping considerable quantities of lead, copper and other heavy commodities of that kind, those liners were able to obtain, to some extent, at all events, the dead-weight ballast which they required. Under present conditions that class of commodity is not available. Those vessels, depending on their size, must get the stiffening they require, representing 3,000, 5,000, 8.000 tons on each eastern voyage. I have known liners actually to pay as much as one cent a bushel for tlje privilege of carrying grain from New York to Europe and tens of thousands of bushels of grain have been carried at from one-half to two or three cents a bushel. That is a condition of affairs that no adjustment of railway rates in Canada can obviate. There is one way in which the situation can be met, and if our hon. friends opposite are prepared to take that step I should be glad to know they have the courage to take it, and that is to prohibit the export of grain through any other than Canadian national ports. If they are prepared to do that, the grain of the western provinces will go through the ports of Halifax and St. John during the winter and through Montreal in the summer. But apart from that I am afraid no very large proportion of grain from the western provinces will be taken away from United States Atlantic ports, particularly New York, as long as modern great Atlantic liners must have a large amount of dead-weight ballast, and with say eight or ten big liners sailing eastwardly weekly, each carrying from one hundred and fifty to four hundred thousand bushels of
Supply-Trade-Grain Act

grain, it will be seen how great this competition with our Atlantic ports is and to how large an extent it may affect and control the situation.


Mr. VBNIOT:: I cannot let the occasion
pass without saying a word or two on this question. The hon. member for Pictou (Mr. Cantley) has told us that within the last forty-eight hours a petition signed by all the Conservative members and senators from the maritime provinces was presented to the government in order to induce it to do that which the Conservative party promised to do when they were in opposition. Of course the signing of that petition is not a political matter at all! Nova Scotia is not wholly represented by Conservatives while New Brunswick is represented pretty nearly all by Conservatives, and some weight might have been given to the petition if our hon. friends opposite had consulted the other representatives of the people and asked their cooperation in this matter. The government side of the house has in the past been talking so much of cooperation. They tell us that we on this side refuse to cooperate, and yet at the very moment when one of the most essential questions affecting the maritime provinces comes up, our hon. friends opposite refuse even to ask for cooperation. Therefore their attitude is not very consistent, nor is that of the hon. member for Pictou consistent to-day because we all remember how he reviled the Liberal party when it was in power. He put forward no such argument in 1928-29 as he has put forward this afternoon as an excuse-


Thomas Cantley: He is learning.


Peter John Veniot: Rather late for my hon.
friend to learn. He is learning to find excuses for the non-fulfilment of promises made by his party when in opposition. That is the extent of his learning to-day. I well remember the Minister of Trade and Commerce, if I am not mistaken, preaching a sermon to us when we sat to the right of the Speaker, about encouraging Canadian ports. Let me give a little matter of history. In 1928-29, the rate from the head of the lakes to Quebec was 34 cents, and to St. John and Halifax 35 cents and a fraction, but let us deal with round figures. What do we find? The port of St. John handled 27,000,000 bushels of grain, and when we were handling 27,000,000 bushels of grain in St. John we were told that there was too much Canadian grain going through American ports, and that that was our fault. The rate from the head of the lakes to Quebec was 34 cents, and the rate from the head of the lakes to the maritime ports, 35 cents.

Quebec got a reduction from 34 cents to 18 cents, and when we in the maritimes pleaded for a rate on a basis of the rate that we had before, when the Quebec rate was 34 cents, I will not say we were refused it by the railway commission, but when the Quebec case was placed before the railway commission the case of New Brunswick and Nova Scotia, or the St. John and Halifax case, was not presented in the same light as the Quebec case. A gentleman by the name of Mr. Duchemin, a lawyer from Sydney, I think, represented the Nova Scotia government at that time before the railway commission, looking on only. His statement before the railway commission at that time was: I am representing the governments of Nova Scotia and New Brunswick, but I am not here at the present moment to push their claims. I do agree, he said, with the arguments of the city of Quebec, and I hope that the commission will see their way clear to grant the request of the city of Quebec for a reduction in the rate. Later on, when some of the commissioners drew his attention to the fact that they were convinced that the claims of St. John and Halifax were properly before the board, Mr. Duchemin stated to the commission before that sitting adjourned, that on the request of his superiors he was withdrawing the Nova Scotia and New Brunswick claims-


Thomas Cantley: Pardon me, that is not what he said.


Peter John Veniot: The hon. gentleman has had his say.


Thomas Cantley: Tell the committee fairly what took place, and what Mr. Duchemin said. He said that in view of the presentations he would ask for a postponement of a decision on that matter.


Peter John Veniot: That is not the fact. The record of the board will show that Mr. Duchemin said that at the request of his superiors he was withdrawing the case. This matter was fully discussed in the press of Nova Scotia and of New Brunswick at the time owing to a statement that I had made in an address at St. John, and I produced at that time the evidence, a copy of the report of the commission, to prove that my statement was correct. Now what happened? Just about three months before the commission sat to consider what was supposed to be the Quebec request as well as the Halifax and St. John request, officials of the Canadian Pacific Railway raised the argument and officials of that railway appealed to certain members of this house whom I could name to use their influence with the Halifax and

Supply-Trade-Grain Act
St. John harbour commissioners not to press their case because if the case for a reduction to 19 cents for St. John and Halifax were pushed, we would have retaliation from the American railroads. Another argument that they used was that if we pressed the case the large quantity of American grain that was then being shipped through the port of Montreal would be diverted from that port and would hurt Montreal. To ibe plain about the matter, I myself, then a member of the government, was approached by officials of the Canadian Pacific Railway to use my influence with the board of trade in St. John, if I had an.v, and with the harbour commission in St. John as well as with the city council of St. John, to have them withdraw the case. I refused to do so, and I exposed that method in a speech in the city of St. John. What happened? A few months afterwards Mr. Duchemin sent notice to the railway commission that they were withdrawing their case or, accepting the statement of the hon. member for Pictou, postponing their case owing to certain conditions, and the case was then either withdrawn or postponed-it makes no difference which. From that day to this that request has never been granted. It has been further considered since this government came into power, and yet it has not been granted, and the Canadian Pacific Railway were the means of preventing the granting of the differential to St. John and Halifax if they were the means of inducing the representatives of the government of Nova Scotia and New Brunswick to agree to having their case withdrawn or postponed. That is where the injury was done to the maritime provinces.
I appeal as strongly as I can to the government to give a decision in this matter. They are the court of last resort. If the railway commission consider that it is out of their jurisdiction or if they cannot see their way clear to giving this lower rate of 19 cents from the head of the lakes to St. John and Halifax, an appeal lies to the governor in council as the court of last resort, and the governor in council has the power to state to the railroads:	You shall fix the rate
at such and such a figure. But so far that has not been done. The case never came before the old government as it is now before the present government.


Mr. MacDONALD (Cape Breton):: That is not correct.


Peter John Veniot: That is correct. It never came before the old government on appeal.


Henry Herbert Stevens: Did it not come before the old government on a petition from the Halifax harbour commission?


Peter John Veniot: Yes, but the reference was made then to the railway commission. The railway commission was dealing with the matter, and the Halifax and St. John authorities, according to my hon. friend from Pictou, had the case postponed. I say that they had the case withdrawn, and after the postponement or withdrawal, as the case may be, they never went before the railway commission until lately-


James Layton Ralston: The old harbour commission.


Peter John Veniot: Yes, and when the railway commission gave their decision lately against the request, the authorities of Nova Scotia and New Brunswick both combined, I think, and appealed to the government against the decision of the commission. That appeal is still resting before the present government. I am not going to criticize the government for the delay. They may have had ample reasons for that delay. We know the amount of business they have to-day, we know the times of stress through which the country is passing, and that as a result the time and attention of the ministers are well taken up. I urge upon them, however that they give an early decision. Such action is very important, so far as the port of St. John is concerned.
Sir Alexander Gibb has given a report most favourable to the harbour of St. John, and I am proud to say in that report he has stated that St. John harbour was during the last six or seven years and is being now administered most economically, and that it deserves all encouragement possible. I am not making this statement to hurt the port of Halifax; I am content to let the people of Nova Scotia fight their own battles, and I shall fight those of the province of New Brunswick. Following the recommendation by Sir Alexander Gibb we have reason to hope that the government will adopt some means by which they can encourage, to an extent greater than has been done, the shipment of grain through Canadian ports, and especially through the two winter ports. The late government did pass regulations encouraging shipment or import of foreign goods through Canadian ports. A preferential duty was fixed by the late government on all English goods entering Canada. Those goods if shipped in bottoms coming through Canadian ports received an extra ten per cent advantage, and that advantage has had a most beneficial effect. The inward trade through the port of St. John has been stimulated. Before the passing of that regulation shipments from Great Britain to reach Canadian destinations came very largely through American ports.
Supply-Trade-Grain Act


Murray MacLaren: That also applied in connection with West Indies trade.


Peter John Veniot: Yes. After the adoption of the regulation through which an extra ten per cent preference was given on all English goods entering Canada through Canadian ports, 99i per cent of all the goods shipped from England to Canada came through our Canadian ports, whereas before that time only 55 per cent or 60 per cent came direct. If the government could devise means which, together with the lowered freight rate on grain, would to a certain extent encourage our western shippers to ship through Canadian ports, to my mind they would promote a movement which would stimulate the maritime provinces and put them on a footing, from an economic or industrial standpoint, better than they occupy to-day or have occupied for some years past.


Mr. MALCOLM:: Mr. Chairman, as a former minister of the Department of Trade and Commerce and as a member in the committee representing a province which is not as vitally interested in the movement of grain through the maritime ports as are the hon. members representing western Canada and the province of Nova Scotia, I should like to say a word or two in support of the minister's position concerning endeavours made towards the movement of grain through the maritime ports.
To the present Minister of Trade and Commerce I should say that I believe the department under his administration is just as anxious as it was when I had the honour to hold his position, to ship as much of our grain as we possibly can through Canadian ports. The late government did provide the facilities. There is now an opportunity, by governmental action to provide a rate which will demonstrate whether or not grain can be handled in any substantial quantity through these ports. In other words, if the present government grants the request of my hon. friends from this side of the house my hon. friends opposite and the senators, I do not think that at the moment much more can be done except to encourage shippers to prove whether or not we can export a substantial quantity of grain through the ports of Halifax and St. John.
There is much truth in the statements of my hon. friend from Pictou (Mr. Cantley) and in those of the minister. We in this parliament however must remember that sometimes we can be a bit too selfish in our national viewpoints. We can be too selfish in our national viewpoint with regard to trade

as we can with regard to tariffs; sometimes these things are two-edged swords. I think the minister will agree that the figures have not changed very much and that we enjoy through the port of Montreal about the same export of American grain as the United States enjoys of Canadian grain through the port of Buffalo. Through the years there has been a fairly even balance, and no doubt my western friends realize that some of the export of American grain through the port of Montreal has, in the past, been very helpful to them. Especially is that true concerning certain lower grades of Canadian barley. A market has been found for that barley, whether high or low grade, by mixing in the port of Montreal with American barley, making an admixture more suitable to the continental trade. Likewise we must remember-and this is not a selfish recommendation favouring the west-[DOT] that the Canadian ports enjoy a very substantial import trade destined for the United States. Especially does that apply on the Pacific seaboard. So, I say, if the facilities and the . rate structure which I know the minister is anxious to give, can induce a greater trade through our maritime ports, I believe every hon. member in the house is prepared to support the granting of the rate. As the hon. member for Pictou has said, complete control of movement through maritime ports can be brought about by putting into effect very drastic * regulations,-regulations which I believe every hon. member must realize might lead to retaliation which would be more disastrous in its effect than the regulations would be beneficial. Therefore I say to my hon. friends from the maritime provinces that as a former minister I thoroughly support them in their request for a one cent differential and I support the minister in his endeavours to increase. trade through these ports iby inducing shippers to make greater use of the facilities provided.
The ports of Halifax and St. John simply must be maintained as they are Canada's only winter Atlantic outlets. There is no politics in connection with this matter. In the past, as in the present, this house has been prepared to sustain and support any rate structure which will enable us to bring as much of our western grain as possible through Atlantic ports. I do not however think we would be adopting the wise course if we were to force upon the minister regulations or suggestions which in the aggregate or in the long run might react unfavourably on his department in other ways. I believe the rate structure or differential asked for by my hon. friends has the minister's sympathetic consideration. He

Supply-Trade-Grain Act
fully realizes the tremendous investment which has been made by past governments in harbour facilities; he realizes the investments made in elevator facilities. I am quite satisfied the minister will do everything in his power to facilitate the movement of grain through the Atlantic ports.


Mr. QUINN:: Mr. Chairman, I am very
sorry I was not in my place when this item was first brought to the attention of the committee. I was quite surprised to learn of the show staged here this afternoon by Nova Scotia and New Brunswick members, with only one exception. It is not very difficult to find a reason for it. If we look at the Halifax Herald of Thursday, April 14, yesterday, we see on the front page, in large letters, the following:
Prime Minister urged to act on maritime appeal. Senators and members declare N.T.R. grain rates case should not be referred back to any body that has already dealt with question.
Now I can understand the panic. Now I can easily understand why the hon. member for Antigonish-Guysborough (Mr. Duff) gets up in his place and expresses his solicitude for the port of Halifax. Now I can understand why the hon. member for Shelburne-Yarmouth (Mr. Ralston) becomes so suddenly alarmed because the port of Halifax is not getting sufficient business. Now I can also understand the attitude of the hon. member for Hants-Kings (Mr. Ilsley) and the attitude of the hon. member for Gloucester (Mr. Aeniot). The member for Gloucester wondered why, when this petition was being drawn up, the cooperation of the Liberal members was not asked. Well, there was a debate here for some three or four weeks and the cooperation of the opposition members was asked to facilitate the passing of the unemployment relief bill, but there was very little cooperation from that side. "We will give you cooperation if you will give us our pound of flesh"; that was the cooperation we got from hon. gentlemen opposite. It is no wonder that these hon. gentlemen become so suddenly interested in the matter under discussion. I am told the hon. member for Antigonish-Guysborough quoted from a speech I made in this house.


William Duff: No; I did not quote your speech at all. I said you made a speech.


Felix Patrick Quinn: Very well; the hon. member referred at any rate to a speech I made in 1926. I well remember it. The hon. gentleman asked whether I was as much interested now as I -was then. I am just as much interested, and more so. But, sir, I am not going
to use every opportunity to stand up in this house and bring to the attention of parliament, either in the house or in this committee, what my attitude is and what my demands are with regard to the port of Halifax. I am making my representations in what I consider the proper way. I am not looking for cheap newspaper advertising or notoriety.


Mr. BRADETTE:: What about the Mc-Conachie family?


Felix Patrick Quinn: I did not bring to the attention of the house the McConachie case for any advertising. If hon. gentlemen will read Hansard they will find that when I made my address on behalf of that family I made it quite plain that I had been asked to do so by a chaplain at the port of Halifax. And that gentleman was not of my political stripe. He was and is a member of one of the outstanding Liberal families of Quebec. I deny what the hon. member for North Temiskaming says, when he charges that I was looking for notoriety or playing politics in that regard.


Joseph-Arthur Bradette: We remember it.


Felix Patrick Quinn: You can remember it if
you wish to. I would remind hon. gentlemen that for nine years, they sat here as supporters of a government, of the same party which introduced the National Transcontinental bill into this parliament in 1903. I quoted in my address in this house in 1926 some of the statements of Sir Wilfrid Laurier and the promises of the Liberal party with regard to forcing the trade of Canada east and west, and in looking through an editorial in the same paper to which I have already referred I find that on July 30, 1903, the then Prime Minister of Canada, Sir Wilfrid Laurier, in asking for leave to introduce a bill to provide for the construction of a National Transcontinental railway, said in the course of his speech on that occasion:
Let me observe that if we have used American ports, it is not because of five months in the year our own ports are icebound . . . but simply because we had no railways to reach them. In the face of this, are the Canadian parliament and people going to stand on their manhood and place us in such a position that at aill times of the year, not only by one railway, but by two or more, we shall have access from January to December to our own harbours, and be able to say to our American neighbours: "Take off your bonding privilege whenever it suits you, we are commercially independent."
In the same address the right hon. gentleman went on:
The Canadian confederation would have been a union on paper and a union on paper only, but for the fact that the Grand Trunk railway, and the Canadian Pacific railway and the
Supply-Trade-Grain Act

Intercolonial railway brought all parts of our country together to act in unison and to beat with the same heart. This new railway will be another link in that chain of union. It will not only open territory hitherto idle and unprofitable; it will not only force Canadian trade into Canadian channels; it will not only promote citizenship between old Canada and new Canada, but it will secure us our commercial independence, and it will forever make us free from the bondage of the bonding privilege. For that reason alone, in my estimation, it would be worth all the sacrifices and far more than we are called upon to make.
I ask this committee: What did Sir Wilfrid Laurier mean by that, if he did not mean that it was his intention and the intention of his government to force Canadian goods through Canadian channels and have them shipped through Canadian ports? I ask further:	Was that the attitude of hon. members opposite during the nine years from 1921 to 1930? They had before them the words of their leader, the greatest Liberal leader Canada has ever had. They knew what he had said when he introduced this bill, namely, that he intended to force Canadian trade through Canadian ports. Hon. gentlemen opposite had their opportunity, but they lay down on the job.


Some hon. MEMBERS:: Oh, oh.


Felix Patrick Quinn: You can laugh if you like. You laugh at every sensible observation made on this side of the house. I see my hon. friend from Vancouver Centre (Mr. Mackenzie), that brilliant gentleman, the only man in God's world who knew that Britain was going off the gold standard. If ever this house had occasion to laugh, it was when that gentleman told the house he knew all about Britain's intention to go off the gold standard.
I think he might be quiet for a little while.
I do not engage the attention of this house on many occasions, and I do not intend to fill up the pages of Hansard now. I simply rose to tell hon. gentlemen on the other side just where I stand with regard to the development of the port of Halifax and the trade to that port. I stand, as I always have stood, ready and willing to do my part on all occasions to impress upon this government or upon any other government the importance of shipping the products of this country through the ports of Halifax and St. John.
Where would this country have been from 1914 to 1918 if, during five months of the year, we could not have sent Canadian troops and materials to the war area from the ports of St. John and Halifax? The majority of our soldiers were sent from Halifax, as well as a great many American troops, and a great many of these soldiers came back through

the same port. That illustrates the importance of developing those ports and keeping them in proper condition, and I say again to the Minister of Trade and Commerce and his colleagues that we in Nova Scotia look to this government for every assistance it can possibly give in the development of our port, and I feel quite certain that as soon as the opportunity presents itself they will give us that assistance for which we have petitioned on many occasions.


William Duff: I think it is to be regretted that after I and other Nova Scotia and New Brunswick members have risen in our places this afternoon in order to impress upon the Minister of Trade and Commerce the importance of using the great ports of Halifax and St. John, the junior member for Halifax should refer to our remarks as a show. It may be a show for him; he reminds me of the story I read, when a boy, of Rip Van Winkle, who slept for twenty years.
Mr. QUINN; You slept for nine years.


William Duff: My hon. friend has been sleeping in this parliament, as far as the shipment of grain through Halifax is concerned, for the last three sessions, and he should foe the last member to refer to our discussion this afternoon as a show, especially when I, who do not represent the port of Halifax, come to his help in trying to get more business for that port.


Felix Patrick Quinn: A political show.


William Duff: My hon. friend also tries to make out that I would not have risen in mv place in connection with this matter if it had not been for the fact that the Nova Scotia members supporting the government discussed this question with the government during the last few days. I am very glad that they did so, but my hon. friend is not fair nor is he correct. Evidently he was out of the house when the discussion started this afternoon, and he .must have been out of the house a week ago to-night as well, when I asked the minister to tell us the policy of the government with regard to the shipment grain through the port of Halifax. I might say to my hon. friend that in my opinion the reason for the meeting of the Nova Scotia members with the government during the last three or four days was that the hon. member for Gloucester and myself rose in our places last Friday night to ask what was the policy of the government. Evidently we must have awakened the Rip Van Winkle from Halifax.
My hon. friend also says that we are trying to get some cheap political notoriety

Supply-Trade-Grain Act
out of this discussion. I wonder what the people of Halifax will think of that statement when they read that my hon. friend from Shelburne-Yarmouth, my hon. friend from Hants-Kings, my hon. friend from Gloucester and myself endeavoured to induce the minister to do something for these two great ports. I am sure they will not call it cheap newspaper advertising. The only reference I made to my hon. friends from Nova Scotia was this: I said that during the years the Liberal party was in power some of my hon. friends from Nova Scotia upbraided the government day in and day out for not doing as much as they thought should be done to have grain shipped through the port of Halifax. I wanted to show the minister that my hon. friend the junior member for Halifax, who was so insistent at that time in asking why grain was not going through that port, has been very silent for the two years this government has been in office, though we find that to-day less grain is going through the port of Halifax than went through it when the Liberal government was in power. It is all very well for my hon. friend to lay a bouquet on the tomb of the great chieftain of the Liberal party, Sir Wilfrid Laurier, with regard to the Transcontinental railway. First my hon. friend says the Liberal party did nothing to ship grain through Halifax, and in almost the next breath he gives credit to Sir Wilfrid Laurier for building the Transcontinental in order that grain might flow through the ports of St. John and Halifax.
What did my hon. friend and his friends do with regard to the Transcontinental railway after the Liberal government was defeated in 1911? That road was built by the Liberal party, who went to the country in 1904 on that issue. I do not know what position my hon. friend took then, in his younger days, but we do know what was done by the Tory party, and we do know their attitude in 1904 with regard to the construction of that railway. They opposed it to the very limit; they did not say one word in favour of it, but my hon. friend says now that while Sir Wilfrid Laurier should get great credit for the construction of that line, the Liberals should be condemned because they did not use the road during the nine years they were in power. Does not my hon. friend know the reason why that road was not used during those nine years, or for that matter during the last twenty years? It was because the ministry of Sir Robert Borden was hardly sworn in before it degraded the Transcontinental railway. It is a well known fact that the road was not finished when the Liberal party was defeated, and what was
done by our Conservative friends from Nova Scotia, and for that matter from every part of the country, with regard to that great enterprise? They deliberately increased the grades and put wooden bridges where it had been intended to use iron bridges. That was one reason why the road was not used; the grades were so heavy that the engines could not pull enough cars to make it profitable to ship grain over that line from Quebec to Moncton.


Thomas Cantley: You had better shade that a little.


William Duff: It is true that the grades were made steeper than they were supposed to be. I do not know the technical term; perhaps the Minister of Railways could tell me, but there is no question about it.


Thomas Cantley: You are off the track a little.


William Duff: No, I am not. I know I am making my hon. friend from Pictou squirm in his seat, but I cannot help it. So I say it does not lie in the mouths of my hon. friends opposite to make out that in their nine years in power the Liberal party did nothing in order to encourage the shipment of grain through the ports of Halifax and St. John. Will not my hon. friend admit that the Liberal party did try to do something? Who built the elevator in Halifax? Was that done by the Conservative party? It is quite true that when the elevator was being built, and when the Liberal government and the harbour commission were endeavouring to do something so that grain would pass through the port of Halifax, the newspaper from which my hon. friend just read said it was useless to build that elevator, that the pigeons would roost on it and no grain would pass through it. If I am not mistaken my hon. friend either used those words himself or said, "Amen" when the Halifax Herald used them. So it does not lie in the mouth of my hon. friend now to say that we on this side are rising in our places this afternoon only because we were forced to do so by a meeting of Conservative members which took place several days after my hon. friend from Gloucester and I brought up this question in the house. Both my hon. friend from Gloucester and I are delighted to have the support of the Conservative members from the province of Nova Scotia, all I can say is: More power to their elbows, and may their efforts be crowned with success. If the government is to do anything I know it will not be done because of what has been said by the hon. member for Gloucester and

Supply-Trade-Grain Act
myself; my hon. friends will try to take the credit 'and I, for one, am willing to give it to them. If the government will put a one cent differential into effect as between Quebec and Halifax and St. John, then I am sure that both the hon. member for Gloucester and I will be very pleased. We will be only too glad to see the port of Halifax obtain a greater amount of business.
My non. friend did not say what he thought about Sir Alexander Gibb's report, and I wonder if he has taken that up with the government. Is he going to be satisfied that no heavy freight shall go through the port of Halifax? The Conservative party has spent, or perhaps I should say wasted, $35,000,000 on this port because the terminal should never have been built at its present location. One-third or one-quarter of that amount would have been sufficient to construct the terminal in the northern part of the harbour and better facilities would have been provided. The fact remains that $35,000,000 was spent by the Conservative party after it came into power in 1911, and the Liberal party has spent more money on this port than it was justified in spending. Money was spent on Halifax which should have been distributed throughout the province, and yet my hon. friend gets up and says that in nine years the Liberal party did nothing for the port of Halifax. During the Liberal regime millions of dollars were spent in providing new facilities in order to encourage freight and passenger traffic through that port. I and other hon. members on this side from Nova Scotia will do everything in our power, whether in opposition or supporting the government, to see that all possible business goes through this great port on the Atlantic ocean.


Mr. SMITH (Cumberland):: Mr. Chairman, I trust I may be pardoned for delaying the committee while I make a few observations on this important question. This is too vital a matter to be the subject of partisan bickerings. To my mind the policy of the routing of Canadian grain through American ports almost challenges the competency of this country as to the utilization of a great Canadian railway, the Transcontinental, built for a specific purpose and at tremendous cost- I understand upwards of $300,000,000. I have not the figures before me, but as I recollect, in 1931, five times as much Canadian grain was routed through the American Atlantic seaports as passed through the Canadian Atlantic seaports. Canadian grain is being routed through American ports in such huge volume as to build up a business in the

United States estimated in 1931, as being worth $20,000,000 to that country. This was the amount of Canadian money expended in the United States to cover the movement and other costs of Canadian grain over American lines and through American ports, while our own ports at Halifax and St. John were being starved for business. During an eight-year period from 1924 to 1931 inclusive, a total of 841,801.868 bushels of Canadian grain passed through American Atlantic seaports, while during the same eight-year period those same American ports handled but 296,025,798 bushels of American grain, nearly four times as much.
The question of the building of the National Transcontinental Railway has been discussed before in this house, and the pronouncements which were made in parliament and during the elections of 1904 and 1908 have been made and do not need to be repeated. The Gibb report is very disappointing so far as Halifax is concerned, inasmuch as it intimates that this port cannot look to the future with any degree of hope for the expansion of heavy basic cargoes, that it must depend principally on package freight. Those familiar with transportation matters and questions of shipping tell me that package freight invariably follows the basic cargo, so if we are unable to obtain the basic cargo-and practically the only basic cargo in this country is grain-then we have little or no chance of securing the package freight. In that respect, and in respect to many other angles to which I shall not refer, the Gibb report is very discouraging.
The former Minister of Trade and Commerce (Mr. Malcolm) has said that this is a serious problem, and with that we all agree. The hon. member also stated that we might lay ourselves open to some measure of retaliation if we embraced too strongly any direct action with respect to the routing of Canadian grain entirely through Canadian ports. As I said before, in 1931, four times as much Canadian grain was shipped through American ports as American grain through Canadian ports, so the question of retaliation is not at all serious so far as we are concerned.


Mr. COOTE:: In referring to Canadian
Atlantic ports, does the hon. member include Montreal?


Robert Knowlton Smith: Yes, Montreal, Quebec, St. John and Halifax, but I excluded the Pacific ports. As I said, this matter is one which challenges our competency to deal effectively with the routing of Canadian trade over Canadian steel and through Canadian ports. I am sure every effort will be made to see that this wrong is rectified and that

Supply-Trade-Grain Act
there shall be a complete utilization of our Canadian ports, and particularly the ones in which I am most interested, the ports of Halifax and St. John.


Mr. HANSON (Skeena):: Mr. Chairman, I should like to have some information from the Minister of Trade and Commerce (Mr. Stevens) in connection with the elevator at Prince Rupert which was built in 1926. Immediately after it was opened, it was leased to the Alberta wheat pool. During 1926 and 1927, several million bushels of grain went through that elevator; in 1928 and 1929 about the same amount; in 1930 and 1931 there was one cargo and in 1932 there has been no cargo so far. I ask this question because I understand the lease will expire within a short time. Does the government intend to re-lease it to the Alberta wheat pool which uses it only as a storehouse? Will the minister enlighten me on that subject?


Henry Herbert Stevens: This elevator is leased to the Alberta pool, and I do not know of any other body of exporters that are more efficient in the handling of their export business than are the pool operators of the prairie provinces. They are now divided into three pools, but sometimes the three operate under one sales agency. They now operate their own sales business, which is efficiently handled and which is in charge of the export trade. At the present time this elevator is full of grain -not moving, I admit-owned by the pool. The movement of grain through Prince Rupert depends naturally on the condition of shipping and the markets, chiefly of the orient. Unfortunately for Prince Rupert-I suppose I can only put it in that way-the main shipping on the Pacific coast calls at Vancouver. Through that port, if I recollect rightly, the export of grain is much larger than it was last year and has reached around 65,000,000 bushels; the movement is free and very large. There is nothing the government has done or can do that will move that grain through Prince Rupert if the owners of the grain do not find the facilities there for its movement to be an advantage over or on a par with those of other ports. As I said a moment ago with regard to the other matter, the grain is in the hands of its owners and they direct its movements. The lease is a very moderate one; the rate is low; the freight rates are low; everything that the country can do has been done for the movement of shipments through that port. The lease, I may say, expires next year. When the time comes the government will consider what is the best thing to do, whether to renew the lease if it is so desired,
or to make a new lease with other parties; but that point has not yet been under consideration.


Olof Hanson: Have the Alberta wheat pool applied for a renewal of the lease?


Henry Herbert Stevens: Not yet.


Mr. HANSON (York-Sunbury):: As a member representing a New Brunswick constituency, I do not think I should let this occasion pass without making some brief observations. I should like to preface my remarks with the statement that I enter into this discussion in no controversial spirit. As has been well said by my colleague from the county of Cumberland, to us in the maritime provinces, especially those of us who are interested in the great national ports of St. John and Halifax, this whole question transcends partisanship. I should like the house to visualize the entire question in that spirit.
Ever since the days of the decline of wooden shipping in the maritime provinces, our people have visualized the utilization of those two national ports as the winter ports of Canada. I am not very old, but my mind goes back to the year 1895, when the Beaver line first used St. John as a winter port. Prior to that time shipments of Canadian products across the ocean had been through Portland. Boston or other United States ports. The citizens of St. John put up a strong battle to controvert the idea that our ports were not usable during the winter season. It was the old government of which Sir George Foster was Minister of Finance that granted the first subsidy for the shipment of goods through Canadian ports including St. John. That was but the beginning, and from that time on the citizens of St, John expended their money and credit in an effort to build up a winter port.
The battle, however, has been a long one, and their hopes have been deferred. It is time that parliament, with the cooperation of every shade of public opinion in the house, dealt with this problem.
I listened with a good deal of interest to the remarks made by the Minister of Trade and Commerce and am appreciative of the fact there are great difficulties in the way. But I should like to impress upon him and hon. members generally that while his statement that the routing of grain is in the hands of the owner is primarily correct; yet grain shipments will travel along the lines of least resistance, and the most important factor is the question of rates. That, I think, is a fundamental principle, and it is only by a reduction in the grain rates that we can, by the natural evolution of business, have that

Supply-Trade-Grain Act
traffic routed through our own ports. Frankly I have always recognized that geography is against the principle for which we are contending; we cannot shut our eyes to the fact; but because of that, we have to take other measures and we ask the cooperation of western shippers to that end. Surely the maritime provinces have done their share in building up the west; surely we have contributed our resources to the building of the railways there, and we ask the western people who are shipping grain to recognize that fact and to reciprocate in some degree. I am not complaining that the shippers utilize the cheapest routes, but I know of no other way whereby this difficulty can 'be overcome and the hopes and aspirations of our citizenship in Nova Scotia and New Brunswick realized, than by making the freight rates attractive. Therefore I urge that steps be taken to put St. John and Halifax rates on a parity with Quebec rates, so-called, plus the differential of one cent. Let us try that out.
I am sorry there has been interjected into this debate this afternoon an element of partisanship. I suppose that is natural in a house composed of two major political parties, but I should like to remind the hon. member for Antigonish-Guysborough and the hon. member for Gloucester that the movement which is now under way and the representations which have recently been made to the government are not inspired by anything they may have said in this chamber. The movement has been under way for some weeks and the memorial which has been presented to the government sets forth fairly, I think, the position of the two provinces represented. I am not quite certain why the aid of Liberal members from Nova Scotia and New Brunswick was not sought. I do not know that it would have added to or detracted from the weight of the representations which have been made. Be that as it may, I do desire to remind this house and the country that ever since the declaration of Sir Wilfrid Laurier in 1903, when he introduced the bill with respect to the construction of the Transcontinental railway, the people of the two eastern provinces have been waiting for the fulfilment of the promise he then made. Although it may have been quoted many times in this house, I desire to read very briefly the statement made at that time, upon which the appeal for the establishment of this rate is now based. The appeal made at that time is based chiefly on the statute under which the Transcontinental was built, and which specified that-

-the through rate on export traffic from the point of origin 'to the point of destination shall at no time be greater via Canadian ports than via United States ports.
That was the underlying principle of the rate structure to be established on tlm construction of the Transcontinental railway. That principle has never been adhered to from that time to this.
I am not blaming any political party or any particular government which has been in power. I am conscious of the fact that very important elements in our own country have been opposed to the establishment and carrying out of the principle underlying that declaration, and I venture to suggest that we do not have to look very much further than the port of Montreal as being the great deterrent to its fulfilment. They are fearful,
I think, of the loss of the traffic which they have enjoyed for many years past in the shipment of American grain through their port. That is natural, but it simply emphasizes the selfishness of the port interests of the city of Montreal. They are willing to fight for that selfish interest no matter what becomes of the rest of Canada or of the winter ports of the maritimes. We from the maritime provinces protest against the selfish attitude of the port of Montreal with respect to this whole question, and I say to my friend the Minister of Trade and Commerce and to the Prime Minister and his government, let us try this matter out. Threats of retaliation should not deter a government from doing what is right if the principle involved is right. I know we are constantly under the economic pressure of the country to the south of us, but we are still a self-reliant nation; I have always noticed that when we stand up for our rights we gain their respect, and I believe that we shall continue to do so if we stand up for our rights in respect to this particular matter.
Let me say just this in conclusion. I did not take up a great deal of time in this house in days gone by when we were in opposition and dealing with the question of maritime rights; though I have sympathized with that movement and have spoken occasionally in favour of it, I have never taken up much of the time of this house discussing it or seeking newspaper publicity with regard to it. The people of the maritime provinces, certainly expect that the principle laid down as long ago as 1903, twenty-nine years ago, by Sir Wilfrid Laurier, shall now be brought to fruition. Matters are now coming to a climax. They feel that ample time has elapsed to make the necessary arrangements. All these huge expenditures which have been made for port facilities,

Supply-Trade-Grain Act
all these things which have been done recently as well as in former years and are now being done through the harbour commissions in St. John and Halifax, have been in preparation for the final carrying out of the principle implied in the Transcontinental railway legislation, and up to date they have all been practically a dead letter. Let all parties in this house get together and get behind the government and ask them to put this into effect at all events as a trial measure. The people of the maritime provinces will then know whether or not they are able to overcome geography, whether they are able to bring to fruition the hopes and aspirations of the last three decades.


Mr. VALLANCE:: Naturally I am much
interested in the discussion that has taken place this afternoon regarding the export of Canada's wheat and the channels through which it should go. I should like to ask the minister if his attention has been drawn to a new item appearing in this morning's Citizen, reading as follows:
Albany, N.Y., April 14.-A Canadian grain syndicate has signed a 10-year lease for the 2,500,000-bushel elevator planned for the port of Albany, it was revealed to-day when bids for the construction work were opened. The name of the syndicate was not revealed, but A. R. Roberts, of Toronto, its representative, said it had resources exceeding $60,000,000 and that it represented a combination of elevator and grain transportation groups. He said it controlled seven elevators and 20 lake steamers.
I would ask the minister if he has any knowledge of this transaction.


Henry Herbert Stevens: No more than my hon. friend has from the announcement he has just read. I should like to intimate to him that one should be a little cautious about attaching full weight to stories of that character. Merely to put the question to me, do I know anything about it or not, cannot get us anywhere. I know nothing about it, and the government knows nothing about it other than the statement which was made in the press. Of course we know, as everybody knows, that there have been many stories about the development of the port of Albany on the Hudson river, and all that sort of thing. There is the question of the deep waterways scheme. All these matters are being discussed in the press by persons, some responsible and some utterly irresponsible. I do not think that in considering the movement of our wheat crop we should be brought into any official contact with suggestions of the possible promotion by Americans or others of projects which are obviously of a private character. I would not like to leave in my answer to my hon. friend 41761-130
the impression that much importance should be attached to the announcement, which obviously is not and cannot be official.


John Vallance: I really must accept the statement in the press as being founded upon a possibility. However, I am willing to accept the statement of the minister that he knows nothing of the matter.


Henry Herbert Stevens: No, I do not.


Mr. DONNELLY:: In connection with this rate on grain to Halifax and St. John, I have been interested to know whether there is any discrimination against our Canadian ports as compared with American ports. Would the minister tell the committee what is the exact railway rate on grain from the head of the lakes to St. John and Halifax, as compared with the rate from the head of the lakes to New York, Boston and other American ports?


Henry Herbert Stevens: I cannot answer the question definitely at the moment, and perhaps it would be better for me not to reply to if offhand. But I am under the impression, and I give this for what it is worth, that the rate from the head of the lakes to Montreal is the same as from the head of the lakes to New York. When we come to Halifax and St. John we come to the special rates for winter haulage in connection with which two factors must be considered. One is the special rate to Quebec from the west of 18-34.


Peter John Veniot: That is not for the winter months.


Henry Herbert Stevens: My hon. friend from Gloucester has said that is not for winter haulage; I am under the impression it is.


Peter John Veniot: It is all the year round.


Henry Herbert Stevens: I was not discriminating in that sense. I had simply said that there was a rate to Quebec of 18-34. Then, there is a special rate to Halifax and St. John which is not as high as the normal rate governing the movement of freight, part of which is accounted for in the Maritime Freight Rates Act. Then there is the differential which is now complained of, and we have the arguments of the hon. member for York-Sunbury and the other hon. members who have spoken, asking for a one cent differential to be added to the Quebec rate which would put the mari-times on a much better basis.
While I am speaking may I say to the committee that this whole question is under study. The discussion this afternoon has been earnestly and effectively put forward by all speakers. I assure hon. members in the committee that as early as possible the matter

Supply-Trade-Grain Act

will be taken under advisement, and I express the hope that some decision may be arrived at in the near future. This matter is of tremendous importance. I do not wish to occupy the time of the committee in a long, detailed dissertation, but I assure hon. members that the question of grain is not the only matter under consideration. Many other elements which will be of advantage to the maritime ports may be worked out before long, at least before another session has passed. I can merely add that in the immediate future we will give the whole question the most earnest study.


James J. Donnelly: If grain is to be shipped out of this country surely the shipper must know the freight rate from Fort William to Halifax as compared with the rate from Fort William to New York, because no farmers would ship grain to Halifax if it cost five or six cents more than to ship it to New York.


Henry Herbert Stevens: My hon. friend is quite right when he states it is necessary to know the freight rates; I have no doubt any man handling grain is quite familiar with them. It just happened that I had not the details of the rates at my finger-tips, but the Minister of Railways has just this moment handed me a diagram showing the rates. From Fort William to New York the rate is 29^ cents, and from Fort William to Halifax and St. John the same rate obtains.


Mr. YOUNG:: Lake and rail.


Henry Herbert Stevens: That is all rail. The
corresponding rate is from Armstrong on the Canadian National railways.


Peter John Veniot: When did the 29i cent rate come into force?


Mr. BOTHWELL:: What is it to Quebec?


Peter John Veniot: It is 18-34 to Quebec.


Henry Herbert Stevens: My information is this
rate has been in effect right along.


Peter John Veniot: No, it has not.


Henry Herbert Stevens: Mr. Chairman, we are
entering a realm of exact rate quotations which I had not anticipated.


Peter John Veniot: There is a difference of
five cents a bushel.


Henry Herbert Stevens: I think my hon. friend is wrong, but I am afraid I cannot dogmatize in the matter. I have given the rates as shown by the diagram supplied by the Minister of Railways and Canals.


Mr. MANION:: Supplied by the railway
board.


Henry Herbert Stevens: Yes, supplied by the railway board. While the information I have given is not a direct answer to the question put by my hon. friend opposite, nevertheless I accept the information on the diagram as correct.


James J. Donnelly: We have been talking
about a 35 cent rate all afternoon; that is why I asked.


Edward James Young: What is the rate to Montreal?


Henry Herbert Stevens: The rate is 28J cents.


Peter John Veniot: I do not wish to be understood as saying that that is not the rate at the present time. I do wish to say, however, that up until a year ago the railway commission never gave us anything under 35-5 to St. John and Halifax. When was this rate put into effect?


Henry Herbert Stevens: I cannot answer that
question from memory, but I think it was within the last three or four years.


Mr. McINTOSH:: I am under the impression the rate is still 351 cents per hundred pounds.


Peter John Veniot: The rate has been given
of 291 cents from the head of the lakes to Halifax and from the head of the lakes to New York. What is the difference in the distances?


Robert James Manion: May I say that this diagram was prepared for me, at my request, by the railway authorities. As the minister has explained, this diagram Shows that the rate from the head of the lakes to Halifax and St. John is exactly the same as the rate to New York. To Montreal it is one cent less. The distances to Halifax and St. John are much greater, but we must remember they are competitive rates, and are in competition with the rates from Duluth and Minneapolis. Duluth and Minneapolis rates are the same to New York. I do not wish to take up the time of the committee, but I must say I was responsible for the chart. Last year for a short time there was a change in the United States rate, and the Canadian rate was changed because it was in competition. That, however, was for only a short time. Those rates are always on a competing basis.


Peter John Veniot: I know -they are op a competing basis, but the impression still prevails that our rate to the maritimes is 35-5 from the head of the lakes. In our application to the railway commission we have asked for a reduction from 35-5 to 19-34.

Supply-Trade-Gram Act


Robert James Manion: That is because of the
Quebec decision.


Peter John Veniot: Yes.


Robert James Manion: That was because of the
decision in favour of Quebec. The rate to Quebec is not the same as to Montreal; it is eighteen cents.


Peter John Veniot: The rate is 18-34. Quebec
had a rate of 34-5; we had a rate of 35-5, and we are asking that the maritimes get a rate of 19-34. While I am on my feet may I say that I regret politics has been introduced into this discussion. I made an effort to keep it out. I see that reference has been made to the statute under which the Transcontinental railway was constructed.


George Gibson Coote: Mr. Chairman, I rise to a point of order. I claim the hon. member is out of order when he attempts to discuss the rate to Quebec under the estimate concerning the Board of Grain Commissioners. I should like to have the committee revert to the question under discussion. It has not been possible this afternoon to ask any question concerning the administration of the act.


Peter John Veniot: Why should the discussion
continue all afternoon and then be closed down at the last moment?


Olof Hanson: I believe the discussion is in order.
Under the administration of the Canada Grain Act a wide discussion may be allowed.


Cameron Ross McIntosh: You talked on it, and
you are never out of order, so it must be in order.


Peter John Veniot: The statement has been
made that the Liberal party, during its term of office, never attempted to carry out or did not carry out the conditions laid down by the statute concerning the use of the Transcontinental railway for transportation to Atlantic ports. If that question had not come up I would not have spoken a second time. But may I call the attention of my Conservative friends to the fact that when they were in power from 1919 to 1921-I am leaving out of consideration for the moment the Union government-they took over all branch and main lines, the Transcontinental, the Canadian Northern and so on; and at that time, in order to encourage more fully transportation through Canadian ports, especially the winter ports of St. John and Halifax, an amendment was proposed whereby, if they had accepted it, the government would not have had any shipments made through the port of Portland. But that amendment was 41761-130J
voted down by the Conservative government; and in 1921, instead of discouraging the shipment of grain through Portland, on October 17 they passed an order in council authorizing that nearly $2,000,000 be expended in the port of Portland to prepare it to receive Canadian goods going through that American channel. So that if we get into a political discussion and resort to recriminations, one against the other, we shall get nowhere in this matter. I thought it was my duty, however, seeing that an attempt had been made to blame the Liberals for having done nothing, to try to find out why the Conservative government in 1921 was prepared to spend $2,000,000 to bolster up the port of Portland against the port of St. John. And in that very year there was not one dollar spent on improvements in the harbour of St. John. I suggest therefore that we had better leave these things aside, because if we get into a discussion in detail of the actions of either party we shall get nowhere. I was very much pleased with the address delivered by the chairman (Mr. Hanson, York-Sunbury) on behalf of the maritime provinces. I think his attitude, one of conciliation and cooperation, will have a greater effect than if we continue trying to make political capital out of a discussion of this kind. While I did express regret that the Liberal members of the maritimes had not been consulted or asked to cooperate in the representations made to the government, still we are prepared to overlook that, and we assure the government that if they will undertake to grant to the maritimes what they are seeking in this respect, they will have the hearty coopera-ion of Liberal members from that part of the country.


Joseph-Arthur Bradette: I believe I should have the right now, as a lone voice from northern Ontario, to state the sentiments of my section of the country. I believe that most of the anomalies which have to be faced in the maritime provinces, would be removed if we could have shipments of grain over the transcontinental from Winnipeg to Quebec during the summer and winter. This is a very vital question to my section of the country, and as some speakers seem to have made it a political issue, I may say that I fully appreciate the position of the Minister of Trade and Commerce, because -when I was sitting in support of this party when it was in power, I made representations to the government of that day. I fully realize the obstacles and difficulties which have to 'be surmounted. I believe that this question is capable of solution. I listened with a good deal of attention to
Supply-Trade-Grain Act

the remarks of the hon. member for Pictou, and it seems to me that the port of Halifax could receive a fair share of the wheat traffic if the old transcontinental could get its quota of freight haulage. I remember, although I was a young man at the time, when in 1903 the charter was granted to the Grand Trunk Pacific. It was said at that time that this was going to provide the Shortest distance from ocean to ocean, and the road was going to haul heavy freight, such as grain and cattle, at a cheaper rate than the railway system as it then existed. The people were told that it was going to shorten the distance so considerably, that, as I remember, cartoons appeared in the Montreal Star suggesting that the Transcontinental line, under contemplation then, would be the shortest way to travel around the world. Sad to say, however, our expectations have not been fulfilled. As we all remember, the Transcontinental section from Quebec to Winnipeg was built by the federal government and was supposed to be handed over to the Grand Trunk Pacific after completion. For reasons well known to the country as a whole, that fact has not been accomplished. The fact remains, nevertheless, that we have never had any real haulage of grain from the prairies to the eastern ports over that section of the road. This is the best section of road bed on the American continent. It is over one thousand miles long and the grades are excellent, so that haulage over that section could be done at a cheaper rate than on any other section of our railways.
This question is becoming more and more acute, particularly in Cochrane and along that section of the Transcontinental, because the people have seen the administration of the Canadian National-I will not discuss this point now-withdrawing passenger service from Montreal to Winnipeg by way of North Bay and Cochrane. In our section of the country last summer and fall we were astonished that the royal commission did not find it possible to have at least a brief sitting in the town of Cochrane, which is one of the divisional points on the Transcontinental, being half way between Quebec and Winnipeg. I hope that before the inquiry is over that commission will visit Cochrane and study for themselves, on the ground, the situation as it actually exists.
I wish to be as brief as possible, and for that reason I will quote some observations and newspaper articles that have been published in the past in regard to this matter. Let me read a short excerpt from a speech

made in 1917 by the hon. member for Quebec East (Mr. Lapointe). Speaking at that time the hon. gentleman said:
The Transcontinental, sweeping from Winnipeg through northern Ontario to Cochrane, and thence over the boundary to Amos and down into Quebec city, provided the most direct route and the easiest gradients from the prairies to the St. Lawrence. Accordingly, when the road was completed in 1916, it was able to quote a rate of six cents per bushel on wheat from Armstrong-a station in the Thunder Bay district just west and north of Lake Nipigon, and almost due north of Fort William and Port Arthur-down to Quebec city, 959 miles distant.
But then a mysterious thing happened. Hardly had the rate been announced when the Conservative government almost quadrupled it.
The increased rate, it is alleged, proved not only discriminatory, but also prohibitive. The result was that the expected volume of traffic did not develop.
What was the reason for this startling increase in the schedule for wheat?
That is why I want to ask the present Minister of Trade and Commerce, as I asked the previous government, for support for this proposal. I want to impress upon the government as well as upon hon. members from the maritime provinces and from Quebec, the fact that enormous sums of money have been spent in the construction of the trans-Canada highway, which expenditure is not coming to fruition for the reason that we do not get our fair share of freight haulage.
Let me read a few paragraphs from a resolution passed by the Cochrane board of trade only a few months ago with respect to freight matters:
Be: Freight Service
1.	The straight line between Quebec and Winnipeg, with an excellent road-bed and minimum of curves and grades, favours rapid and economical haulage of heavy freight trains.
2.	The. junctions at Sioux Lookout, Nakina, Hearst, Cochrane, Taschereau, and Herve also support the contention that the National Transcontinental Railway should be put to greater use in cross-country freight haulage.
3.	During the war, a huge quantity of freight was hauled over this line at a lower tonnage cost than any other transcontinental railroad.
4.	The winter haulage of grain to Canadian Atlantic seaports can be accomplished more economically over this road.
5.	The rapidity of development of northern Quebec and of northern Ontario is an assurance of increasing incoming and outgoing freight.
6.	By using the old Grand Trunk line between Toronto and North Bay, and the Ontario government owned Temiskaming and Northern Ontario railway between North Bay and Cochrane, the National Transcontinental railway can handle the Toronto-Winnipeg freight to greater advantage.
7.	The diversion of Canadian grain to American ships, railroads and elevators with resulting loss of wages to Canadian workmen should he prevented and the National Trans-

Railioay Act
continental railway restored to its proper object of hauling western grain to Canadian Atlantic seaports and carrying eastern products and imports westwards.
8.	Of the three transcontinental lines crossing Ontario; Canadian Pacific, Canadian Northern and National Transcontinental, the last is the more suitable for rapid and economical haulage and crosses the most populated, prosperous and promising agricultural, mining and timber districts, suitable for the establishment of one million more Canadian citizens.
A few moments ago the Minister of Railways gave the rates from the head of the lakes to St. John and Halifax via Montreal, and he mentioned Armstrong. Maritime members of this house should realize that this movement is not over the Transcontinental railway from Armstrong direct to the city of Quebec and on to Halifax; it is via a roundabout way, through the Ottawa valley, and because of this the distance covered is very much lengthened. This is an anomaly which should be remedied. At the present time I am apparently the only one directly interested in that section of the country, but I make this appeal to members from the maritimes and in fact to all members asking for their support.
Why was that road built? It is stated that it cost over S170,000,000, but to-day the rails are practically rusting from lack of through haulage. The road was never intended for local traffic. I remember as a young man working as a common labourer on that line, and we realized then that there would be very little local traffic. When this government granted a charter to the Grand Trunk Pacific Railway it was realized that the Transcontinental was to be used primarily for the hauling of cattle and grain to the Atlantic coast.


An hon. MEMBER:: Carried.


Joseph-Arthur Bradette: No, it is not carried.
I hope the hon. member will allow me to go on, because this question is of vital importance to all Canada.
At six o'clock the Speaker resumed the chair, and the house took recess.
After Recess
The house resumed at eight o'clock. RAILWAY ACT AMENDMENT



RAILWAY COMMISSION AND RATE STRUCTURE-SPECIAL COMMODITY RATES

[Stage Direction]
Mr. THOMAS REID (New Westminster) moved the second reading of Bill No. 44, to amend the Railway Act.
Robert James Manion: Mr. Speaker, I am afraid I shall have to oppose this bill on principle because there are two or three ideas introduced which have not been observed in this country for many years. Section 1 of the bill adds the following words as subsection 2 of section 320 of the act:
The board may consider the question of what should be reasonable compensation under the circumstances, and may establish a rate structure in the interests of trade development and public policy, though such experimental rates may not at the time or of themselves give reasonable compensation to the railway companies.
It is proposed by this section to give to the Board of Railway Commissioners a power which in the past has always been entirely in the hands of the government of the day, the power of developing trade and the formulation of general public policies. In other words, we would be permitting the Board of Railway Commissioners to take unto itself the matter of the trade of this country, which matter belongs to the government and to the Minister of Trade and Commerce. No government in the past has ever suggested that the formulation of such policies shall be put in the hands of an outside body. This objection in itself is sufficient to condemn the bill from the standpoint of any government, whether the present government or the one which preceded it. Section 2 of the bill reads as follows:
Subsection five of section three hundred and twenty-five of the said act is amended by striking out the proviso thereto and substituting the following therefor:
"Provided that, notwithstanding anything in this subsection contained, rates on grain and flour shall, on and from the twenty-seventh day of June, one thousand nine hundred and twenty-five, be governed by the provisions of the agreement made pursuant to chapter five of the statutes of Canada, 1897, but such rates shall apply to all such traffic moving from ail points on all lines of railway west of Fort William to Fort William or Port Arthur-
Then come the words suggested to be inserted :
-and to all such traffic moving westwardly from Fort William, and from all points on all lines of railway west of Fort William, to Vancouver, British Columbia and to ports on the Pacific coast,-*
And then follows the wording of the old section:
-over all lines now or hereafter constructed by any company subject to the jurisdiction of parliament."
I suggest that that section means that rates shall be fixed without a hearing being given to the railway companies or to other inter-
Railway Act

ested parties. If I understand rightly, I think the intention is to put into force all the Crowsnest rates westward. The hon. member nods assent, so apparently I have interpreted correctly. This parliament has no facilities for the making of rates. I admit that in the past, I think it was 1897, parliament did by statute fix the Crowsnest rates, but that was done in agreement with the Canadian Pacific Railway Company and was in return for the fulfilment of certain conditions by that company. As a general rule parliament has always taken the attitude that it does not fix rates. I consider this to be the right attitude because parliament, constituted as it is, is not capable of going into such a complicated matter as the freight rate structure of this country. That question is perhaps the most complicated with which anyone has to deal, and early in the present century the Board of Railway Commissioners was constituted for the purpose of giving its full time to the study of the question. The board is the proper body to which to apply for such rate fixing as is covered by this bill.
Thus there are two principles invaded by this bill. The first is to hand over to the Board of Railway Commissioners the forming of the trade policy of the government, which is a matter purely within the jurisdiction of the government through the Department of Trade and Commerce. Secondly, the bill attempts to fix rates, something which has never before been attempted by the parliament of Canada in such a bill as this. Certainly rates should not be fixed without giving an opportunity to be heard not only to the consumer, to whom the hon. member referred, but to the railways themselves. The two principles involved in the second reading of this bill cannot be accepted, in fairness to the railways, in fairness to the people, and in fairness to the parliament of Canada itself.
There is at the present time a royal commission sitting in Canada, appointed to look into the whole transportation question. No one knows at the moment what the recommendations of that commission will be, and it is quite possible that it may offer suggestions Which would alter the scope of this bill. In view of what I have pointed out, I suggest to my hon. friend in the friendliest way possible that he might be well advised to withdraw the bill for the present session and hold it over until the next session of parliament. It is possible and even probable that the next session may be called at a date earlier than has been the case in past years, and my hon. friend would not have to wait very long for an opportunity to bring in a bill which would

comply with the points I have mentioned.
I appeal to the hon. gentleman, in the spirit of fair play which I hope he will show in this regard, to let this bill stand over until next session. By that time he will have had time to look thoroughly into the question and to deal with it in such a way that the recognized principles of rate making which have been in existence in Canada for many years shall not be infringed.


Mr. A. W. NEILL (Comox-Alberni):: Mr. Speaker, I am familiar only with the general principles of this bill. I cannot understand why a request should be made to defeat it on the grounds of fair play. I do not think the question of unfairness is involved in this bill;
I submit that t-he unfairness has existed in connection with the rates prevailing on shipments to British Columbia. The Minister of Railways (Mr. Manion) has stated that this bill would give too much power to the railway board, and suggests that it is the duty of the government to deal with matters of this kind. If so the government has failed signally for some considerable time to fulfil its duty; I allude to the standing grievance of British Columbia in connection with the discrimination in the rates between grain for export and those for domestic consumption. Blame can be laid at the doors of both the present and past governments, the net result being that this discrimination has been in effect for something like six years. If now is not the time to take action, I do not know when it will be. It is suggested we should consider it between now and next fall. I submit that we have already had ample time in which to discuss it. If I am not mistaken, the hon. member who introduced the bill quoted the other day from the Duncan report, which specifically recommends the very phraseology which has been inserted in this bill, in one section at any rate. The Duncan report was very highly approved by very many people, and by far the greater part of its provisions have been carried into effect.
As regards fixing rates, which the minister deplores, he himself says there is precedent for that. He does not need to go so far back as the initiation of the Crowsnest pass rate, because it was renewed again in 1923 or 1924, and this bill seeks not to fix rates or make new ones, but only to authorize the railway board to extend the principle of the rates there suggested and carried out. He used the words "to fix rates." I would not say "to fix rates"; it is to equalize rates, only to make the rates westward the same as they are eastward on similar goods and under similar conditions.

Railway Act
He suggests that vve should await the report of the royal commission. That commission is dealing with transportation in its broadest aspect and is extremely unlikely to make any specific recommendation regarding rates. Meanwhile we do not know when it will report or what the nature of the report will be, or anything else. But we have before us a gross outstanding grievance from which the people of British Columbia have suffered for quite a number bf years. There is no reason why we should not put our hands to the plough to remedy it now; it is there and obvious, and apparently this is the proper method. The Duncan 'Commission and other authorities have said that if we ever expect the Board of Railway Commissioners to give us that justice for which we ask in British Columbia, some language such as this will have to be inserted in the bill to give them the authority, because at the present time it is lacking. I think some members of the railway board, in the course of decisions rendered, indicated that their ruling would have to be adverse to our just desires and interests because of the lack of authority which they pointed out and which is, by this bill, sought to be given to -them. I am surprised the bill has not had some active support, not only from western members whose interests are identical with ours in British Columbia, though coming from the other end of the journey so to apeak, but also from other British Columbia members.


Mr. G. B. NICHOLSON (East Algoma):: If the hon. member who has introduced the bill intends to press it, I desire to say a word with regard to it. I am opposed, first of all, to the whole principle of making special rates for the movement of commodities in any part of the country. General business in many parts suffers more than anything else from what has taken place in the last twenty years in making special rates for particular commodities in certain parts of the country. This bill in its general outline proposes to introduce what is known as the Crowsnest pass rates on all commodities moving westward from Fort William to the Pacific coast, leaving aside altogether the amendments which are proposed to section 320. It should, I think, be obvious to anyone who has given thought to the transportation problem of Canada that if the railways are to continue to operate, they must get somewhere a sufficient revenue to pay the bill. That revenue can be secured in just two ways, either by the people whose commodities are moving paying the cost of moving them, or by the general public paying through their general taxes
for the movement of those commodities, At the present time, on one line of railways, the Canadian National, this payment is being made partly in one way and partly in another. The person who moves commodities or who travels on the Canadian National lines pays part of the cost of operation; the general public pays the balance, an amount that since the railway was taken over by the Canadian people has been approxiately $75,000,000- a year. As regards the Canadian Pacific, up to the present moment the people whose commodities are moving have paid the entire cost. If we are to get down to a sound business basis, the commodity that is being moved must pay the cost of moving it; but by such measures as the one now before the house the railway commission is virtually given instructions to make special rates on particular commodities in certain sections of the country. This means that if the railways are to secure sufficient income to pay wages and meet the cost of coal, oil and all manner of operating expenses, some other commodity in some other part of the country must carry the load. Without desiring to criticize what has been done in the past I may say that rates have been made-and perhaps rightly so; I am not at the moment going to dispute the principle-to favour special commodities in particular parts while other commodities in other parts must bear the burden. Within the last few minutes I have taken occasion to get the comparative rates on one particular commodity on western and eastern lines of Canadian railways. A British Columbia lumberman can now move a carload of lumber 1,200 miles for the same cost that an Ontario or Quebec or New Brunswick lumberman can move a carload of lumber 800 miles. If this bill is passed, then the Ontario, Quebec or New Brunswick lumberman will have to bear an additional cost or some other shipper of another commodity will have to bear it to equalize the loss of revenue involved in putting these rates into effect.
If I correctly understood the hon. member who introduced the bill, when he spoke on the first reading he indicated it was his judgment that reduced rates would increase the movement of traffic and the railroads would make more money. That may be quite true; I am not going to dispute it. It may be that the hon. member understands the incidence of railway earnings and what will increase them better than Sir Henry Thornton or Mr. E. W. Beatty or the traffic officers of the two railways, but I am somewhat doubtful and I maintain that before an enactment of this kind is passed, at least the traffic officers of
Supply-Trade-Grain Act

the railway commission should determine what the effect is going to be in that regard. Before any legislation is passed in the house creating special rates or conditions for any commodity in any part of the country, the whole rate structure should be recast on a basis that will be equitable to all commodities and to all parts of Canada. Special legislation creating particular rates for one commodity or one part of the country has, as I said a moment ago, bedevilled the whole rate structure and made it impossible for business to be conducted on an equitable basis. I am opposed in principle to a measure of this kind. Instead of removing discrimination, it can have no other effect than to increase it as between one commodity and another and one part of Canada and another.
On motion of Mr. Munn, the debate was adjourned.



DEPARTMENT OF TRADE AND COMMERCE

[Stage Direction]
The house in committee of supply, Mr. Stirling in the chair.
The Canada Grain Act, including management, operation, maintenance and equipment of elevators, administration of, $2,400,000.
Joseph-Arthur Bradette: Before the house rose
at six o'clock I was pointing out the opportunity which the National Transcontinental railway affords for more direct communication from ocean to ocean and the need for a greater amount of traffic being routed over that road. It has been suggested that the reason we have not our proper share of through freight traffic for the transcontinental is found in physical conditions. Last summer I spent three weeks making an inquiry into this phase of the matter, and I should like to give to the committee the information I gathered in regard to the physical obstructions we have to face in our section of the country.
A very misleading and detrimental opinion seems to be that northern Ontario and northern Quebec suffer from unusual climatic conditions. As a matter of fact the temperatures in these parts compare favorably with much older and more settled parts of the country. The snowfall is invariably lighter, and although we sometimes experience lower temperatures, they are not constant, and the air being dry, the cold does not affect one nearly as much as a damper climate with higher temperatures.
The Timiskaming and Northern Ontario Railway and that portion of the Canadian National Railways known as the transcon-

tinental have operated through northern Ontario and northern Quebec for some years and do not suffer traffic delays owing to climatic conditions. Trains Nos. 1 and 2 of the Canadian National Railways operated over these lines for the past twelve years wdth practically no delays chargeable to weather conditions, and maintained their schedules without difficulty.
Prior to the construction of the Nakina-Longlae cut-off, which connected the transcontinental railway-with the former Canadian Northern Railway, that portion of the Canadian National railway stretching from Winnipeg to Quebec city, some 1,300 miles, enjoyed a period of prosperity and showed a profit over and above operating costs of approximately forty cents on the dollar. Owing to the extremely low grades and slight curvatures through this portion of the country, heavy tonnage and long freight trains make for profitable operation. Solid trains of stock were moved over this line in trains of seventy-five cars and at a speed which saved the expense of unloading and feeding once between Winnipeg and Montreal, which in itself means much in shrinkage and expense to shippers when one considers there are twenty-five to thirty head of stock per car.
Grain was moved over the transcontinental line at a rate of eleven cents per hundredweight and moved at a profit, on account of these favourable conditions.
In comparison with the grades on the Canadian Pacific railway, Algoma district,, across the same portion of the country,, although much further south and through hillier territory, the same class of engines actually handle only one-third the tonnage handled by the same power over the transcontinental line.
Since the building of the Longlac-Nakina cut-off the portion of the transcontinental, .between Nakina and Quebec has existed on purely local traffic, made up of pulpwood, construction .material and manufacturing materials such as sulphur, coal, lime, and so forth, for the manufacturing plants located along this line, and even under these conditions the road operates at a profit, although a reduced one.
The Transcona elevator, originally built to clean grain and supply the transcontinental line with traffic has never been used to any extent. It would avoid moving the grain to the lake head for cleaning and give the western shippers a shorter route to the ocean ports, a saving in tonnage which would benefit the east as well as the west.

Supply-Trade-Grain Act
I well remember seventeen years ago the big celebration we had in Cochrane when the first national transcontinental train came in from Toronto. At that time we visualized through passenger and freight traffic going over that transcontinental section of the line, but we have been sadly disillusioned. We have not got that traffic, for reasons which are unknown to the people of northern Ontario, unless it is discriminatory rates. I listened with a good deal of attention to the Minister of Trade and Commerce this afternoon stating that the government has absolutely nothing to do with the routing of the grain. I appreciate that, nevertheless we feel that if there had not been a discriminatory rate against the transcontinental route from Winnipeg to Quebec city and the maritime provinces we would have received a fair share of the through traffic during the last fifteen years. It has been mentioned this afternoon by members from the maritime provinces that at a certain period during the construction of the Grand Trunk Pacific the whole project was jeopardized on account of the fact that the grades had been tampered with, or that they were not being built up to the highest standard possible from ocean to ocean. That condition does not apply on the transcontinental section from Winnipeg to Quebec, because luckily most of that construction iwas done under the regime of Sir Wilfrid Laurier. I should like to read a clipping from the Halifax Mail which I think is well worthy of the attention of the house. Under the heading "A forgotten Railway," this paper says:
Discussing the memorial of the Cochrane (Ontario) Board of Trade ("vigorously seconded" by the maritime provinces), the Winnipeg Free Press has some pointed comment to make on "a forgotten railway policy."


The CHAIRMAN (Mr. Stirling):: I would
remind the hon. gentleman that we are discussing the administration of the Canada Grain Act.


Joseph-Arthur Bradette: With all due respect
to you, Mr. Chairman, I submit that my remarks are no more out of order than many of the speeches we heard this afternoon. In fact, the hon. member for YorksSunbury left the chair for a while to make just the same kind of speech that I am making now. I believe the minister wall support me in that. I shall not delay the committee very long.


Grote Stirling: The hon. member will please come to his point.


Joseph-Arthur Bradette: My point, Mr. Chairman, is that the transcontinental is not being
given a fair share of the through grain traffic from Winnipeg to Quebec and the maritime provinces. I will continue with the quotation:
The Cochrane memorial, it will be recalled, urges the use of the Transcontinental! railway for the purposes for which it was constructed, and the Free Press notes that "in these pleas there is embodied an argument from an almost forgotten past." It adds: "All that has been said by the Cochrane memorial and the spokesmen for maritime interests is true."
The Winnipeg paper points out that the national transcontinental gives the most direct communication between the west and Quebec and the maritime provinces. It has "an excellent roadbed with curves and grades planned for the economical haulage of freight. Moreover, the roadbed was built at a vast cost for the express purpose of carrying freight, especially wheat, from the west to the sea under exceptionally favourable conditions."
The Free Press concludes its editorial comment on this subject as follows:
"Having regard to the use to which the road has been put, it can only be assumed that this railway was built by tlie country in a fit of absent-mindedness. Before the road was finished, the country forgot what it was all about; and not only has no effort been made to put it to the purpose for which it was built, but difficulties in the way of permitting it being applied to these purposes have been encouraged."
"Looking back twenty-five years or fifty, it is clear that the railway scheme, with which the people appeared so fascinated in 1904, has thus far been disastrous to the country. It is a very large contributing factor to the existing railway-trouble. But whether the responsibility for the failure rests upon the government which planned and built the road, or upon the governments which have been in power since the road was completed, is very much an open question. Either the Laurier government, which built the road, did not know what it was doing, or the governments to which have fallen the task of seeing that the road should do the work for which it was supposed to be built, have been sadly lacking in vision and enterprise."
I now make an urgent appeal to -the government to permit us to get our fair share of this through traffic on another score. During the last eighteen months most of -the men working on the transcontinental from Winnipeg to Quebec have bee-n taken off, -and only yesterday I received a letter say-i-ng that more men were being thrown out of work. A -proper routing of our -grain coming east would -mean more emjUoymen-t in my section of the country. This I belie-ve is sufficient reason for putting the facts ibef-ore the house; I hope hon. -members will be familiar with the situation. If no grain were going -through American ports it would foe entirely different, but I have in my hand a record showing that almost fifty per cent of our grain -passes through American ports. There must be an anomaly somewhere, and the house should enter into a thorough discussion of the matter and endeavour to
Supply-Trade-Grain Act

supply a remedy. The people of Canada who are not familiar with railroad matters and with matters of commerce are asking questions. They do not know why it is not possible to direct some of the traffic over the Grand Trunk Pacific or the Canadian National.
To make my point clear, and to be as brief as possible, I shall read to the house some of the reasons why in my section of the country there is dissatisfaction. I have before me an editorial from the Cochrane Northland Post, which I have no doubt will give food for thought to some hon. members in this house. It is as follows:
Any really satisfactory solution of this gigantic problem must necessarily include two features; the utilizing of the lowest haulage-cost sections to their full capacity, and an increase in freight traffic. Other features such as mutually advantageous cooperation between the two great railway systems will have their place in the solution, but these two are of paramount importance.
In dealing with the matter of increased freight traffic, it may, at first, seem illogical to speak of increasing freight traffic in a wide spread country such as Canada with its just a trifle more than 10,000,000 people. But in the year 1930, according to Colonel C. E. Phinney, President of the Halifax Harbour Commissioners, "Canadian grain moving eastward for export during the past year (1930) has been handled through the following channels:
Via Canadian ports-47,300,000 bushels.
Via United States ports-67,700,000 bushels."
And speaking at Halifax last October, Colonel Phinney quoted an editorial indicating that "transportation of 1,000,000 bushels of grain over the National Transcontinental to an Atlantic port would cause the expenditure of $53,000 for labour and $10,000 for fuel.''
Thus, if, in 1930, the 67 million bushels of grain which was exported via the United States had been shipped over the National Transcontinental line over 38 millions of dollars more would have been paid to Canadian workers. Why should this money, so greatly needed by our own workers, be paid into the pockets of workers across the border? The continuation of such a situation is inimical to the welfare of the country and intolerable to the pride of the people of Canada. And that there has been no effort made to remedy this disgraceful state of affairs is shown by the fact that in August and September of 1931 (the first two months of the 1931-32 crop year), wheat shipments of Canadian grain to the United Kingdom left Canada as follows:
Via Canadian Atlantic	ports-2,781,810
bushels.
Via Canadian Pacific ports-2,454,455 bushels.
Via United States ports-11,796,785 bushels, or over twice as much Canadian grain was exported through American channels as through Canadian channels. Such a condition must be irritating in the extreme to Canadian railway and port workers on short time and many without work at all. If it requires a royal commission to right wrongs such as this, surely it is about time that we had new administration for our railways.

There can be no excuse, no justification for this execrable wrong to Canadian ports and Canadian workers. The Dominion government by act of parliament, decreed in the N.T.R. Act:
"The through rate on traffic from the point of origin to the point of destination shall at no time be greater via Canadian ports than via United States ports." In his Halifax speech above referred to Colonel Phinney said:
"The railway built to carry this grain" (Colonel Phinney was referring to the National Transcontinental), "has cost us $330,000,000, and I say we should not sit down and do nothing about it while deficits pile up year after year, on a railway for which we have paid and are still paying, and which is not being operated.
"Isn't it better, for example, to lose a sum of money each year on the railway and have it in operation, than to lose the same sum and not have it in operation? The traffic this road could carry is going through American ports and over American railways, and I ask if it would not be better business to go over our own lines and through our own ports."
When the Canadian railways were caught in the act of transporting Russian pulp to American markets, which was directly competing with our own Canadian product, they offered the excuse that they needed the traffic, and yet here is a vast amount of home grown traffic slipping through their hands into American channels. To paraphrase the song, Do you call this Ganadianism?
We believe that the majority of Canadians are whole hearted ly behind the Canadian National railways. We all, or nearly all of us, have faith in it and believe that it will succeed."


Some hon. MEMBERS:: Oh, oh.


Joseph-Arthur Bradette: I think hon. members
should be more respectful. I have spoken very little this session and I submit I should be allowed to state the case for northern Ontario. Hon. members have spoken on behalf of the maritime provinces, and I intend to speak for northern Ontario. I may take a half hour more. The: article continues.
But it must be operated for the benefit of the Canadian people. Here in the National Transcontinental line, we have a railroad designed and built to carry heavy trains with a minimum of motive power, a line over which western grain can be hauled to Atlantic ports cheaper than over any other line. In the name of common sense, why is this fine not used for the purpose for which it was designed and built? Why is Canadian grown grain, which could be transported over this line cheaper than over any other line, diverted to American channels with the consequent loss to Canadian railways and to Canadian workers?
This matter is not just a local one. It affects Canada as a whole. When Canadian workers are deprived of earnings to the extent of over 38 millions of dollars in one year, it is the concern of all Canada. When traffic, which could be economically handled over a railway line built

Supply-Trade-Grain Act
and paid for by the Canadian public, is diverted to foreign channels, the people of Canada have a right to ask why.
What are the railway heads going to do about this? What about our members of parliament?
From the discussion which has taken place to-day it would seem that the maritime provinces, the province of Quebec and northern Ontario are very much interested. To-day a condition exists along the Transcontinental railway from Quebec to Winnipeg wherein thousands of men who were working on the railroad for the last eighteen years have been thrown out of employment. When they read articles such as this disclosing the fact that fifty per cent of our grain production reaches American ports, dissatisfaction must arise in their minds. In my view it is only right and proper that the matter should be discussed on the floor of the House of Commons.
I said at the, beginning of my remarks that I did not intend to discuss the matter from a political standpoint, but rather to bring it before the house merely as a condition which must be faced. I greatly appreciated the statements by the Minister of Trade and Commerce, and I feel sure he will do his utmost to arrive at a solution. I listened with equal interest to the remarks of the ex-Minister of Trade and Commerce, who said that the situation was both delicate and intricate. At the same time I maintain Canada should do all in its power to obtain its share of the through traffic.
At this point I should like to read a letter from the Telegraph-Journal and the Evening Times-Globe of St. John, New Brunswick. This letter is dated April 6, 1932 and is as follows:
Dear Sir:
The United States Department of Commerce recently announced that on the average 49 per cent or approximately one-half of Canada's wheat and flour export trade has been handled through United States ports during the last six years.
Practically no wheat has passed through eastern Canadian ports during the last winter season, and our information is that during the summer months almost the entire Canadian crop routed east went to Buffalo.
We beg to draw your attention to the enclosed editorial, published to-day in the Telegraph-Journal and the Evening Times-Globe and to urge upon you the gravity of this situation.
We feel that you, in your public capacity, can strike a blow for the people whom you represent in parliament by standing for the formulation of and strict adherence to national transportation policy which will divert this valuable trade stream from foreign channels
to Canadian railways and Canadian ports, and thus give much needed employment to thousands of Canadian citizens.
The people of Canada are being urged continuously to buy Canadian goods, and thereby employ Canadian labour. In our judgment, Canadian labour includes Canadian railway men and Canadian port workers as fully as it concerns itself with the employees of manufacturing plants.	.
We feel that men in public life can render no greater service to our country at the present time than by doing their utmost to correct this most unpatriotic and uneconomic condition of affairs.
Yours very truly,
F. X. Jennings, Acting Editor-in-Chief.
This letter pictures the situation existing with regard to our national railways. I hope the Minister of Trade and Commerce will do his utmost to have his department solve this problem, and, if that is not possible, then some other department, the Railway department for example, should, in my opinion, take steps to meet the situation, so that we shall receive justice in the maritime provinces and also in Ontario. I trust that we shall receive the quota of traffic to which we are entitled, and in that way the situation, which is becoming graver and graver, will be remedied.
I mentioned a short while ago that only yesterday I received a letter from a clergyman of Cochrane deploring the fact that even now, after having been in suspense for several months, employees of the Canadian National Railways who have been in their service fifteen and eighteen years are being laid off- carmen, trainmen, and various other men employed on the road. I repeat that if we were getting our fair share of freight transportation over the Transcontinental from Winnipeg to Quebec there would be no railroad unemployment in our section of the country. I sincerely hope that the government will find some solution for this problem. We talk of national policies in this country; a good deal is said about the "Canada first" policy. Well, I submit to the minister that this should be one of the first principles to apply to the railways and our harbour facilities, namely, that we should receive that fair quota of transportation to which we are entitled.


John Vallance: Is the grain standards board considered to be under the control of the grain commission?


Henry Herbert Stevens: No. The grain standards board is organized under the provisions of the Canada Grain Act. The chairman of the Board of Grain Commissioners is, I believe, by virtue of his office, chairman of the grain

Supply-Trade-Grain Act
standards board, and of course the individuals who constitute the grain standards board are appointed under statute. They discharge their duties under powers and instructions laid down therein.


James J. Donnelly: This item shows a reduction of $331,000. Last year, as we all remember, there was a very small crop and the number of inspectors and graders would not be as large as in an ordinary year. How is the decrease accounted for this year? Does the government anticipate a smaller crop than last year's and fewer employees? In other words, what is the explanation of this reduction?


Henry Herbert Stevens: Included in last year's were the wheat bonus and a substantial portion, if not all, of the cost of the Stamp commission.


John Vallance: Just administration?


Henry Herbert Stevens: Yes.


James J. Donnelly: Do the employees working for the government under this act come under the ten per cent reduction the same as other employees?


Henry Herbert Stevens: Yes.


Mr. GARDINER:: The members of the
board too?


Henry Herbert Stevens: Yes.


Mr. McPHEE:: In connection with the
wheat bonus, will the minister say who printed the three million cheques?


Henry Herbert Stevens: Bulman Brothers, of
Winnipeg.


George Washington McPhee: Were tenders called for the printing of the cheques? If not, why not?


Henry Herbert Stevens: There was no time. The matter was urgent and was rushed by the Board of Grain Commissioners, upon whom was laid the very difficult and complex task which it involved. The board organized it, and, I think, organized it very well. They have handled some three million cheques during the season, up to the present time, for the matter is not yet completed. As I say, there weis no time to be lost; a month or any long period could not have been allowed to elapse so as to call for tenders. Bulman Brothers are looked upon as very efficient printers, and in the judgment of the board they discharged this task in the best manner possible.


George Washington McPhee: How much money was paid?


Henry Herbert Stevens: -The total paid to Bulman Brothers for the printing of the various forms was $40,000.


Robert Gardiner: Did the board order these cheques?


Henry Herbert Stevens: Yes.


Robert Gardiner: Not the government?


Henry Herbert Stevens: No; the board did absolutely all the work. Instead of setting up a. new organization we simply seconded the Board of Grain Commissioners in carrying on the work.


Mr. BEAUBIEN:: Was there any political motive-


Henry Herbert Stevens: Certainly not.


Charles-Philippe Beaubien: Just a minute; the minister does not know yet what my question is going to be.


Henry Herbert Stevens: I know wffiat is coming.


Charles-Philippe Beaubien: Was there any political motive in having the Prime Minister's name printed in black on the cheques?


Henry Herbert Stevens: We all thought black was the .most becoming colour instead of red for the Prime Minister's name. I can assure the hon. gentleman that there was no political motive in it at all. It was very well organized and the Prime Minister was concerned in it as Minister of Finance. If it were this year it would be the present Minister of Finance. The name was that of the minister who was responsible for the payment of the cheque.


Charles-Philippe Beaubien: Does the hon. gentleman think the present Minister of Finance would insist on having his name printed on the cheque?


Henry Herbert Stevens: I do not think he could
escape it.


Mr. TOTZKE:: Was the $40,000 paid for the printing of cheques and forms included in the cost of administration?


Henry Herbert Stevens: Yes.


John Vallance: The minister says that this decrease of $331,000 is due to the administration of the five cent bonus.


Henry Herbert Stevens: No, plus-


John Vallance: I have in my hand the estimates of 1931-32-


Henry Herbert Stevens: The hon. gentleman misunderstood me. I said the Stamp commission, the five cent bonus and the ten per cent cut.

Supply-Trade-Grain Act


John Vallance: That makes it worse, because I find that in the estimates of 1931-32, which was last year, we voted $2,681,000 and the year before, 1930-31, $2,884,049. There was no administration of the five cent bonus in that year, nor was there any Stamp commission, so there must have been some other reason for the decrease. There was a decrease last year, compared with the year before, of $203,048, and this year a decrease of $331,000.
Mr! STEVENS: I pointed out the other night that in addition to the cut in salaries and wages, and in addition to the two other items I have just mentioned, we have this year cut out construction work practically altogether. None is required, so far as we can see, and there is included no construction work, which accounts for a considerable sum. These are the four main reasons for the reduction, and as far as we possibly can we are insiting on every economy that can be at all secured.


John Vallance: How many employees are under the control of the Board of Grain Commissioners, and what salaries are paid?


Henry Herbert Stevens: The number of employees is about 930.


John Vallance: Permanent?


Henry Herbert Stevens: The salaries for this year are estimated at $1,908,000 and the number of employees is 847, with the temporary employees varying from about 380 to 400.


John Vallance: How many of those
appointments come under the Civil Service Commission?


Henry Herbert Stevens: All but the temporary appointments.


James J. Donnelly: The minister said it
took $40,000 to print the literature in connection with the distribution of the five cent bonus. I should like to know what other matter was printed in addition to the cheques, if there was anything else, or whether this $40,000 was paid for the cheques only.


Henry Herbert Stevens: There were some other
forms, receipts and so on. There were certain agencies through whom reports of deliveries of grain were made. Every licensed elevator, every warehouseman and so on-my hon. friend knows better than I do the type of person licensed under the Canada Grain Act -made reports of grain delivered to the Board of Grain Commissioners, and to each
such licensed agent certain forms were supplied. All that printing, and a good deal of other printing, came out of the $40,000, which covered all the printing necessary to carry out the work.


Charles-Philippe Beaubien: Is it the usual practice
in making payments by cheque to have the name of the Minister of Finance, or any other minister, on the cheque?


Henry Herbert Stevens: I suppose my hon. friend
refers to departmental payments.


Charles-Philippe Beaubien: Or any other payments.


Henry Herbert Stevens: In the payment of ordinary government departmental accounts it is not customary, but I do not recall a parallel to this particular instance. These cheques were sent out to individual farmers all over the country; there had to be some authority indicated on the cheques, and no authority other than the Minister of Finance of this government could have been indicated.


Robert Gardiner: That would be a
guarantee of payment, would it not?


Henry Herbert Stevens: Certainly.


Charles-Philippe Beaubien: I understand that cheques issued by the Department of Finance are generally signed by the accountant and not by the minister himself. That is why I asked if there was any political significance in this case. Of course if the government are prepared to renew the bonus and to increase it in order to compensate the farmer for the very heavy burden being placed upon his shoulders by their arbitrary way of handling the tariff, the people might like to get another cheque signed by the Prime Minister so it could be framed. Is the minister in a position to tell us now if the government will continue the bonus for the crop year 1932-33?


Henry Herbert Stevens: First may I say that these cheques were not issued to be framed; they were issued to provide cash for the individuals receiving them.


Charles-Philippe Beaubien: Many farmers took
photographs of those cheques just to get the name.


Henry Herbert Stevens: I am very glad of that,
because undoubtedly it was a red letter day for the farmers. Of course any announcement of the decision of the government in connection with such matters as the bonus will have to be made by the Prime Minister.


Charles-Philippe Beaubien: Just in case the members of the government have not come to a decision with regard to the bonus, I should
Supply-Trade-Grain Act

like to make certain representations now to the government and to the minister himself, because I know he will deal with this matter in conference with his colleagues. If the government intend to grant the bonus for the crop year 1932-33, I would ask them to consider the barley grower. The minister is aware of the fact-and if he is not, the commissioner sitting in front of him can tell him-that in many districts in Manitoba we have gone into the production of barley, for economic reasons. My information, which I think is fairly accurate, is that fifty per cent of the barley produced in Canada is grown in Manitoba. Many farmers cannot successively grow wheat there because of rust, so if the government contemplate continuing the bonus I ask them to consider the barley grower, who is as much entitled to the bonus as the wheat grower.
May I make another suggestion to the minister. This morning I received a letter from home stating that eggs are being sold for five cents a dozen and butter is being almost given away. Would the minister take up with his colleagues the advisability of giving a bonus on eggs and butter in order to compensate the farmers for the excessive taxes imposed by the tariff?


Mr. GERSHAW:: I should like to ask the
minister whether he contemplates establishing any more inspection points in the west. A number of men connected with the grain trade in Medicine Hat feel that they are operating at a great disadvantage because that is not an inspection point. They made strong representations to the chairman of the grain commission, and I was wondering if any progress has been made or if the question has been further considered.
Mr. STEVEN'S:	Speaking for the government, of course with the advice of the Board of Grain Commissioners, I may say that the matter has been considered but it is not thought that further inspection points are desirable or necessary. There is Moose Jaw and Calgary, and I have no doubt my hon. friend has in mind Medicine Hat as well, in connection with which representations have been made, but it is not thought necessary to go to the additional expense of establishing other inspection points.


Sir EUGENE FISET:: I am rather curious about those cheques. I wonder if the minister will be kind enough to explain how they were prepared and by whose authority the printed signature of the Minister of Finance appeared on them. The minister knows as

well as I do that in the ordinary departmental routine cheques are usually countersigned by the accountant and signed by the deputy minister or whatever other official has been given authority by order in council to sign them. There is no law authorizing a minister of the crown to sign a departmental or other cheque unless such authority has been given by order in council, so I would ask the minister if a special order in council was passed authorizing the Minister of Finance to sign those cheques. This is a most extraordinary procedure; really I do not understand it.


Henry Herbert Stevens: I think my hon. friend
will see the difference between this case and the ordinary signing of departmental cheques when I tell him these really were not cheques at all. They were certificates; on those certificates there had to appear some authority, and that was the authority of the Minister of Finance, who was proceeding under the act.


Eugène Fiset: Was a special order in council passed authorizing that procedure?


Henry Herbert Stevens: No. I think not. The
certificate was payable by the Dominion government, but by arrangement, the certificates were recognized and paid by the banks.


Eugène Fiset: I think the minister will admit that the ordinary procedure in such a case would have been to have the cheques signed by the deputy minister and not by the minister. It is the most extraordinary thing I have ever heard of, and I have had a certain amount of experience in these matters. It is stated that these were certificates and not cheques, but they were cheques to the extent that they could be exchanged, and unless a special order in council was passed authorizing the Minister of Finance to take such action they should have been signed by the deputy minister.


Robert Gardiner: What was the revenue and expenditure last year in connection with government elevators?


Henry Herbert Stevens: For the crop year 1930-31 the receipts were $949,409, the expenditures $425,441, leaving a surplus of $523,968.


Robert Gardiner: How many additional inspectors have been employed because of the amendments to the act?


Henry Herbert Stevens: At the time the act was amended it was thought that quite a number of new inspectors would be required, but I think it will be recalled that we reported last year that up to that time-this is now confirmed by our experience of the past year- practically no more inspectors would be

Supply-Trade-Grain Act
necessary. It will .be recalled that additional services were included in the amendment such as the registration and supervision of binning, the settlement of claims and the appointment of an assistant commissioner. These are the new services rendered but no additional inspectors have been required.


Robert Gardiner: With the exception of the assistant commissioner?


Henry Herbert Stevens: Yes.


Robert Gardiner: Was there any increase in the staff because of the inspection of binning?


Henry Herbert Stevens: No additional staff was required, it was a sort of adjustment of the duties of the existing staff.


Robert Gardiner: There will be no extra expense attached to the new provisions with regard to inspection?


Henry Herbert Stevens: Not as regards inspection in the ordinary sense.


Robert Gardiner: How much wheat was handled at the terminals at Prescott and Kingston, and are these elevators under the control of the Board of Grain Commissioners?


Henry Herbert Stevens: The elevator at Prescott is under the Department of Railways, and I understand the one at Kingston is controlled by the Canada Steamships line.


Robert Gardiner: That would come under the control of the 'board?


Henry Herbert Stevens: It is licensed as a public
elevator.


George Washington McPhee: Reverting to the $40,000 paid by the government as a political favour to the firm in Winnipeg for the printing of these cheques; this matter becomes more colossal on referring to item 294 at page 64 of the estimates. This is an item under trade and commerce and covers printing of parliament and departmental publications, including the Canada Year Book, and the amount is $426,750. Forty thousand dollars of the taxpayers' -money has been paid to this firm in Winnipeg without a tender being called for. Without delaying this item too long, I should like the minister to tell the committee on whose authority Bulman Brothers were asked to print these cheques, I should also like to know what other printing is included in this -amount, and what the cost was for the cheques alone.


Henry Herbert Stevens: Any suspicions which my hon. friend has of political favouritism are not
well founded. This is precisely what happened. When the act was finally passed and the house rose about the first week in August, i-t was necessary that some organization should l>e rapidly got together to deal with this situation. After consideration the government decided to impose this duty upon the Board of Grain Commissioners. The task was assigned to them, and they accepted with one -consideration, that they should be given carte blanche in administration and as to where and how they were to get the supplies required. They were given carte blan-che, no one dictated to them, and I am informed by the chairman of the board that this printing was give-n to Bulman Brothers on his own initiative because he considered -them to be the firm who could give -the best service in the shortest time in connection with an important order which had to -be gotten out as quickly as possible.
I say quite gladly to my hon. friend that the organizing of the staff to -handle this task and the manner in whi-c-h it has been carried out during the past year is a credit to the staff and to -the Board of -Grain Commissioners. As far as I am concerned, I take no credit either to myself or to my department; we had nothing to do with it. Everything has run so smoothly tha-t up to date I do not think there has been one complaint. The Board of Grain Commissioners handled everything; no questions were asked until they produced their account. I think the whole thing was wisely and economically done.


Charles-Philippe Beaubien: Did the suggestion -that the name of the Pri-me Minister should appear on these -cheques come from the genial -chairman of the -board?


Henry Herbert Stevens: It was a certificate from the government of Canada -to the farmer and it had to -bear some recognized signature which would be accepted by the -banks. The name of the Minister of Finance was decided upon, and I have no hesitancy in saying that it was the proper thing to do.


Charles-Philippe Beaubien: I never heard of a bank accepting a printed signature on a cheque.


Henry Herbert Stevens: The -cheque was countersigned by the authority by whom it was issued.


Charles-Philippe Beaubien: Has the minister one of those cheques available?


Henry Herbert Stevens: No, I have not,


Charles-Philippe Beaubien: I should like to see one.


Henry Herbert Stevens: I imagine I could have one -photographed for the hon. gentleman.
Supply-Trade-Grain Act


Charles-Philippe Beaubien: I should like to have one so that I could frame it and show it through my constituency. The electors would then have the Prime Minister's name in front of them for the rest of their lives and could think of the promises he made in 1930.


Henry Herbert Stevens: I would not mind having a limited number framed for the hon. gentleman.


Charles-Philippe Beaubien: Have the amounts filled in and let the Prime Minister sign them.


Mr. LUCAS:: Does the minister know of any farmer refusing to accept one of the cheques?


Henry Herbert Stevens: We have no evidence to that effect.


Mr. REID:: Is the grain for export through Vancouver tested for moisture? I have in mind certain instances where disputes have arisen as to the moisture content.


Henry Herbert Stevens: It is not uncommon to have disputes arise, and at times reinspection of grain is made at Vancouver. These inspections are made according to law and precisely the same as they are made at all other inspection points.


Thomas Reid: Is the grain tested for moisture?


Henry Herbert Stevens: Most certainly.


James J. Donnelly: I noticed an article in the press this morning giving the quantity of wheat that was going to be in store next August. How much wheat is there in store at the present time as compared with last year? Is it more or about the same?


Henry Herbert Stevens: A day or two ago I had
a statement up to date, but I am sorry I do not have it under my hand. I think what my hon. friend refers to was a statement published recently by the Bureau of Statistics based upon the regular monthly reports of all elevators, and so forth. Speaking from memory, I think the quantity in store is around 230,000,000 bushels, which is materially less than it was at the same time a year ago.


James J. Donnelly: Is the minister referring to Canada alone, or to the world?


Henry Herbert Stevens: I am referring to Canada.


James J. Donnelly: In Canada alone what
is the carry-over of wheat from last year?


Henry Herbert Stevens: The chairman of the
Board of Grain Commissioners tells me the quantity at the present time is around 186,000,000 bushels.


James J. Donnelly: What was it at this
time last year?


Henry Herbert Stevens: Some figure not far from that, I believe.


James J. Donnelly: That is just the point
I am referring to. I saw an article in the Ottawa Journal, I think it was, stating that on August 1 or September 1 of this year we were going to have a very small carry-over. We were told the same thing last year, but when September 1 came, we found it was more than before. This year, although we have had only half a crop in Canada, we have not been able to get rid of it because there was a bigger carry-over than there was the previous year. I should like to know the prospect of having a small carry-over this year. As regards all these guesses, there seems to be something we know nothing about looming up on the horizon. Last fall the Minister of Agriculture ran short of political fodder, or whatever you choose to call it, so he went down to the maritimes and told them the price of grain would be eighty cents a bushel and all our troubles would be over. I am sorry, however, to say that it never reached eighty cents a bushel. On that occasion he was simply prophesying; he must have been short of political ammunition. I suppose in a few days the Minister of Mines will go somewhere else and tell the people what Noranda or some of the other copper mines will do. My hon. friends opposite are a little short of politioal ammunition when they start prophesying what the market, particularly the grain market, will do. My experience of prophesying about the grain market is that it is a dangerous thing to do. I expected last fall would be a sucker market and it proved to be so, to catch those who wanted to try, to make some more money.


Charles-Philippe Beaubien: Was that your experience?


James J. Donnelly: Yes. What is the duty at present against our wheat in Germany, France and Italy?


Henry Herbert Stevens: I have to speak from
memory and I am afraid I shall take some chances in doing so. The duty in European countries fluctuates quite frequently. The German duty is, I think-and I speak with some hesitation-around a dollar a bushel. It

Supply-Trade-Grain Act
is very high. I believe the highest rate is $1.50, and we get the secondary rate, which is a dollar a bushel. The French duty is something less than that, but I am afraid I cannot give it offhand.


John Vallance: If we bear in mind that during the war the western, Canadian wheat grower was the only individual in Canada the price of whose product was controlled-and it was controlled to allow the allies to buy the wheat at a much cheaper rate than that at which they otherwise could have bought it- has any effort been made by the government to break down that barrier against Canadian wheat entering those countries?


Henry Herbert Stevens: We are continuously making efforts, but I would invite hon. members' attention to the fact that in the last five years, or possibly a little longer, there has grown up in Europe an entirely new attitude toward imported wheat. The quota system has for its object definitely and distinctly the promotion of an increase in production of wheat in countries such as France, Germany, Spain, Italy, and one or two others. Eastward from that you get into the exporting countries, but the chief importing nations have imposed a definite and effective quota system with the deliberate intention of increasing the production of wheat in their own territory. The rates of duty are very high and the result has been to increase the production of wheat in those areas and also of rye in some places. But we have been constantly in touch with the situation, and are doing everything possible to increase the sale of our wheat.


John Vallance: Have there been any results?


Henry Herbert Stevens: I think so.


Charles-Philippe Beaubien: Did I understand the minister to say there was a surplus of $500,000 in the operation of the Grain Act?


Henry Herbert Stevens: The elevators.


Charles-Philippe Beaubien: Do I understand the farmers pay all the cost of the operation of the Grain Act?


Henry Herbert Stevens: No, there was a deficit in the last two years.


Charles-Philippe Beaubien: Is it very large?


Henry Herbert Stevens: In 1930-31 there was a net deficit of $241,149.


Edward James Young: Last year the government gave a guarantee of a minimum price of wheat. Has the minister any statement to make to the committee as to how the government stands now as a result of that guarantee?


Henry Herbert Stevens: There was no government guarantee of the price of wheat. My hon. friend is perhaps giving a wrong impression.


Edward James Young: We had the impression the government guaranteed the price would not fall ibelow a certain point. Did it not do so?


Henry Herbert Stevens: My hon. friend is thinking of the arrangement with the pools. The government stood behind the pools so that in the absence of the pools' assets, which, as my hon. friend knows, were tied up by the indebtedness of the pools to the three prairie provinces, the banks could make the usual advances, but there was no guarantee by the government of the price of wheat. I believe the government's action enabled the pools to pay a larger fixed or initial price than otherwise would have been possible. If it had not been for the assistance rendered by the government to the banks, the pools would not have been able to pay an initial price at all.


Edward James Young: As I understand the matter, the government's action enabled the pools to pay a certain initial price. As a result of the guarantee that the banks would not lose anything by allowing the pools to pay that price, what is the government's position to-day in that regard?


Henry Herbert Stevens: Financially?


Edward James Young: Yes.


Henry Herbert Stevens: Not a cent has been called for from the government.


Edward James Young: Is there any possibility of its being called upon to pay anything?


Henry Herbert Stevens: No. The result was very satisfactory.


James J. Donnelly: Last year the agriculture committee asked certain witnesses to come down from Winnipeg and testify, one of whom was Mr. James Richardson, of James Richardson & Sons, Winnipeg, who testified that unless the government or some individual got under the grain prices and propped them up-that was his expression, I think-prices were liable to fall to a very low level during the month of October when the grain was coming on the market. He advised that the government either do it itself or authorize someone else to put a prop under the market. Were any government funds used for that purpose, or was anyone authorized by the government to put a prop under the grain prices? Was anything done to hold up the prices in the grain market last year?

Supply-Trade-Grain Act


Henry Herbert Stevens: Of course I am not responsible for anything Mr. Richardson may have said before the agriculture committee, and I do not know just what he had in mind. The only prop the government put under grain prices was the one to which we have just referred, that is assisting the pools in the financing of their portion of the crop. There is this point, however, to bear in mind, that during the past year grain prices have oscillated less than normally; they have been on a fairly even keel. Prices have been low, it is true, but they have not largely fluctuated. So what Mr. Richardson predicted did not occur.


James J. Donnelly: It is common street
talk all over western Canada that the pool, or the officials of the pool with governmental money, have sustained the market at the present level. I do not know if there is anything in that, and it was to try to get that information from the minister that I asked the question.


Henry Herbert Stevens: Unquestionably if it had
not been for the action of the government in the crop year before this, and in the past crop year, there would have been serious difficulties for the pool, for the selling agency which sold for all three pools in the previous crop year, and last year for the three separate pools. It will be recalled that Mr. John McFarland was called in and took charge of the selling agency of the pool, as it was called, and it was through his efforts in wisely administering a very difficult task that that particular job was successfully carried through. Last year, as I say, it was done through the separate pools, and the action of the government undoubtedly steadied the thing down. Had we not done what we did, that is, given our guarantee to the banks, what would have happened is this: The pools, being without assets-their assets having been hypothecated against the indebtedness of the previous years -would have been unable to make the initial payment, in which case the members of the pool would have probably sold their wheat wherever they could have done so, and a condition of panic might have ensued. But through the cooperation and coordinated effort of the government, the banks and the pools themselves, the whole market was held steady.


John Vallance: In view of the fact that the government guaranteed the banks against loss from the pool on the understanding that John I. McFarland take over the managership of that selling agency-am I correct in that statement?


Henry Herbert Stevens: I do not think we can say that.


John Vallance: The Prime Minister said so.


Henry Herbert Stevens: No. My hon. friend is
leaving the impression that the government dictated that Mr. McFarland be the manager. I am not in a position to confirm my hon. friend's statement in that regard. I shall not contradict him, but I should not like to agree that he is quite correct.


John Vallance: The minister will not
contradict the statement. Has the government any knowledge of John I. McFarland buying wheat, and to what extent he to-day holds future wheat?


Henry Herbert Stevens: I have no knowledge of
that at all, and, so far as I know, no member of the government has any knowledge of Mr. McFarland's activities in that regard.


Edward James Young: If he did that, could he
do it without the government's knowledge?


Henry Herbert Stevens: Oh, yes. If he is able to
finance it, he could do as he liked in that respect.


John Vallance: The Prime Minister
while acting as Minister of Finance last year claimed that because of the guarantee given by the government to the banks, they maintained the price for wheat. I contended at the time that to argue that way was to claim credit for steadying the world's market; for he spoke not only of the Canadian market but of steadying the world's market. At least he said that those in the grain trade acknowledged that his actions had brought about that result. There is a strong suspicion throughout western Canada that there is a large volume of grain being held, and I would ask the minister to find out if that is true. If it is not true it dhould be stated accordingly, because it is strongly rumoured that John I. McFarland is to-day holding large volumes of wheat, speculating in futures, with the' Canadian people's money.


Henry Herbert Stevens: Oh, no, I must hasten to correct that.


John Vallance: The banks hare guarantees against it.


Henry Herbert Stevens: For a statement of that
kind to go out unadorned would be very damaging, and I know that my hon. friend would not wish to do either the wheat market or Mr. McFarland or anyone else an injury.


John Vallance: That is why I wanted the question cleared up.

Supply-Trade-Grain Act


Henry Herbert Stevens: Mr. John McFarland, of
course, is independent of parliament and of the government. He is a gentleman of means, a gentleman with knowledge of the wheat business, and if he has bought wheat on his own account that is his own business. In regard to the pool, Mr. McFarland has served the pool, so I am informed, without salary, as a matter of public service, and I am advised by those who are in a position to know, that it has been a service that is highly appreciated by all. I think we should pay a tribute to Mr. McFarland for the service that he has rendered in that respect.
As far as the government is concerned, I have already stated clearly what it has done. In the year 1930-31, the government stepped in and gave certain guarantees, but behind the government's guarantee was the assets of the pool, the elevators and so forth. The exact figures I cannot recall, but my hon. friends no doubt know them. As far as that guarantee is concerned, I understand that there will be no losses at'all. I think it is practically cleared up now as far as any danger of loss is concerned. This year the three pools were confronted with the task of carrying on their business without assets, the assets having been hypothecated to the three provincial governments on the prairies. We again stepped in during the current crop year and guaranteed the pools to the banks so that the banks would advance the pools enough money to make an initial payment. That really meant working capital for the pools. It enabled the pools to discharge that duty and undoubtedly held the market steady in both years, and I confess that I can see no possible ground for criticism of the government in that respect. To the extent that it held the Canadian market steady in the face of the rather strange actions of the farm board south of the line, it contributed to the steadying of the world market.


Charles A. Stewart: How can
my hon. friend say that?


Mr. MOTHERWELL:: The world market
-oh, oh!


Henry Herbert Stevens: Why should my hon.
friends object to that statement? I say that to the extent that Canadian wheat influences the world market, and it certainly does influence it-


Charles A. Stewart: That is a
different statement.


Henry Herbert Stevens: To the extent that Canadian wheat influences the world market, the government's action contributed indirectly to the steadying of the world market.
41761-131J


John Vallance: Can the minister tell
us what percentage of the total world market Canada's exportable wheat represents?


Henry Herbert Stevens: Of course it varies from year to year, but roughly speaking one would say from twenty-five per cent to thirty per cent.


John Vallance: Would the minister mind asking the chairman of the grain commission?


Henry Herbert Stevens: He tells me that that is his information.


James J. Donnelly: I gather from what the minister has said that Mr. McFarland must be speculating, because he has said the pool this year has steadied the market. How can the pool steady the market? This year the pools have been buying grain the same as any other companies, and when they bring their wheat in they sell it and hedge their "buys" or "solds" each day. When they hold out they are speculating. In a line company doing legitimate business what they buy to-day they sell to-morrow. If Mr. McFarland is doing otherwise he is speculating in and holding wheat. That is what I have been asking the minister. I have been inquiring whether Mr. McFarland has been speculating in or holding wheat, and the minister seems to think he has steadied the market.


Henry Herbert Stevens: My hon. friend is not putting a fair construction on my observation. I make no statement concerning, and I have before me no knowledge of, the exact actions of the pool. It must be borne in mind that this year the three pools are each carrying on their own business, operating separately. They receive wheat, and undoubtedly in the usual way they hedge on the market. They do their business in a normal way; just how much they have bought or sold I cannot tell my hon. friend. Where the government came into the matter, however-and I have said this three times; I trust my language is not obscure-the government simply guaranteed the banks against loss on the pool's initial payment to the farmers on the purchase of grain.


James J. Donnelly: We understand that
quite well. The pools this year are handling very little of the wheat as it is pooled. The greater portion of the wheat is handled by the pools in the ordinary manner, just the same as it would be handled by any other grain company. The minister now tells me that each of the pools in western Canada is
Supply-Trade-Grain Act

carrying on in the normal way, or is handling its own business. If each pool is selling its own grain I should like to know what Mr. McFarland is doing. What is his business?


Henry Herbert Stevens: Mr. McFarland is the manager or the one in charge of the central selling agency of the pools, handling the wheat for the crop year 1930-31.


Charles A. Stewart: Of all the pools?


Henry Herbert Stevens: Yes. But for the crop year 1931-32 the three pools are operating separately, and are not under the control of a central selling agency.


Edward James Young: Mr. Chairman, I have not the reference before me, but speaking from memory, and of course subject to correction, may I say that in the Financial Post of last week the statement appeared that when Mr. McFarland undertook to sell the 1930-31 crop he at the same time bought futures against it, and that as a result of his activities the government to-day is holding millions of bushels of future wheat which it cannot get rid of, except at a loss, until the price goes up.


Henry Herbert Stevens: I do not know of a bushel of wheat held by the government, either directly or indirectly.


Edward James Young: Will the minister find out?


Henry Herbert Stevens: Yes, certainly. I am quite certain, however, that there is no such condition as that outlined by my hon. friend.


James J. Donnelly: Did I understand the minister to say that Mr. McFarland has nothing to do with the pools this year?


Henry Herbert Stevens: That is my understanding. He was the head of the selling agency when it acted for all the pools; I am speaking of the crop year 1930-31. In connection with the crop year 1931-32 the three pools are operating apart from the selling agency.


Charles A. Stewart: Without
guarantees from the government?


Henry Herbert Stevens: There is a guarantee to the banks this year for the three pools.


Charles A. Stewart: If that is so, may I ask the minister if Mr. McFarland has anything to do with the control of the selling?


Henry Herbert Stevens: As far as I know, he has not.


Charles A. Stewart: No control whatever. The government have given unconditional guarantees to the banks for the operation of the three pools.


Henry Herbert Stevens: No; my hon. friend is not fair. He has put in my mouth words I did not use.


Charles A. Stewart: What other construction can we place upon the minister's words?


Henry Herbert Stevens: My hon. friend has said
that the government has given an unconditional guarantee; that is not so. The guarantee is subject to the presence of the wheat as security, and an initial payment. In other words the ordinary bank line of credit is extended to the pools, which were without working capital and could not have functioned if the government had not taken action. The government has simply guaranteed to the banks a line of credit to the pools, so that the pools may function in the ordinary way. The banks naturally take the security of the wheat against the advances they make. The margin of safety has been around 32 cents or 33 cents of the market price, whatever it is.


Charles A. Stewart: Then Mr. McFarland is not officially acting for the pools or the government on this year's sales?


Henry Herbert Stevens: No, I do not think so.


Charles A. Stewart: And the
government has guaranteed each individua. pool to the extent of the initial payment on the wheat; that is, they have guaranteed accounts.


Henry Herbert Stevens: What is required to make that payment by the banks.


John Vallance: I think we are at cross purposes. In the past crop year the pool permitted all contract signers who so chose to disregard their contracts.


Henry Herbert Stevens: Quite true.


John Vallance: So that to-day John I. McFarland is not operating the central selling agency. Immediately after the imperial conference of 1930, and after the return of John I. McFarland, he assumed the responsibility as manager of the selling agency. He took that responsibility on two understandings: First of all, he was to receive no salary, to which arrangement we quite readily agreed, and secondly, he was to be given a free hand as to the method by which he was to dispose of the wheat. His first act was to close all the European sales agencies. Then because of

Supply-Trade-Grain Act
the fact that the pools disregarded the contracts or allowed the contract signers to disregard them, a very small percentage of wheat found a market through the pools. Probably in all there were only a few million bushels; in fact I think less than 10,000,000 bushels were marketed by the pooling system. Did the government guarantee to the individual pools that amount of wheat at 35 cents a bushel?


Henry Herbert Stevens: During the crop year
1931-32?


John Vallance: Yes.


Henry Herbert Stevens: Yes.


James J. Donnelly: Can the minister tell
rls how much of the 1930-31 crop owned by the pool is still in the hands of Mr. McFarland, when we may expect it will be sold, and when Mr. McFarland will be allowed to discharge the office he holds at the present time?


Henry Herbert Stevens: My hon. friend and all
hon. members who have participated in this discussion will please recognize the fact that we are not in any sense in control of the pools, and such answers as I have given are given to the best of my information and without precise knowledge. I am told that there is not much of the 1930-31 crop left in the hands of the selling agency. My hon. friend will have to accept that statement for what it is worth as I have no exact information in connection with it.


William Richard Motherwell: On whose say so
were the wheat producers subdivided into three separate units or pools?


Henry Herbert Stevens: On their own say so.


William Richard Motherwell: I think not. That action was very much against their desire.


Henry Herbert Stevens: Certainly it was not upon the government's say so, or through the action of the government.


William Richard Motherwell: It must have been
either through Mr. McFarland or the government. Here is what happened:	The hon.
member for South Battleford indicated that Mr. McFarland, since getting into the saddle, had closed all the sales agencies in Europe and England. The next step was to disintegrate the pool so that it would no longer be one unit. I understood before, as I gather from the minister now, that Mr. McFarland is still selling the overage as general manager of the old central wheat agency, but the three
prairie provinces have three distinct pools now handling this year's crop. What I should like to know is, who worked out that policy against the wishes of the farmers of the west? Someone did.


Henry Herbert Stevens: Certainly not the government; it certainly had nothing to do with the government.


William Richard Motherwell: Well, who did it?


Henry Herbert Stevens: I tried some time ago to indicate the processes which operated to bring about this result. In the 1930-31 period the pools found themselves in difficulties, and the guarantees of the three prairie provinces, on behalf of the three pools, came due and had to be faced, with the result that the assets of the three pools, three distinct organizations, were placed under the control of the three provinces. I do not mean to say they were turned over to them, but were hypothecated for the security of those provinces.


Charles A. Stewart: Pledged.


Henry Herbert Stevens: When the 1931-32 crop came on the market, these assets having been hypothecated against the losses of the past- that goes back to the 1929-30 crop-the pools had nothing to offer to the banks as security for working capital, and then this government stepped in and gave its guarantees to the banks to enable the three pools to function. As to who withdrew the pools from the central selling agency, I have no idea; at any rate it was due to no action on the part of this government.


William Richard Motherwell: Whoever may be
responsible, they are pretty well divided up now, so that there is not a chance in nearly a lifetime for them to get together and operate as they were doing before. Through Mr. McFarland or someone else, the organization is nicely carved up into units so as to render them incapable of proper action and functioning. I want now some information in regard to the Stamp commission's report. Last year I put on the order paper three or four questions and inadvertently one of them was not answered. I inquired who or what body asked for a royal commission, known later on as the Stamp commission. Has my hon. friend any information on that subject? What body or individual asked the government to appoint a royal commission to decide on what effect the selling of grain futures had on the producers of the country?


Henry Herbert Stevens: I am under the impression that it arose out of discussions in the house
Supply-Trade-Grain Act

or in the committee on agriculture, but I am not in a position now to inform my hon, friend from memory just who asked for it, or whether any request was made for it.


William Richard Motherwell: I assure the hon. gentleman it did not arise out of the committee on agriculture but out of something quite different. Surely the government should know exactly why the commission was appointed. Usually someone asks for a commission but I have never been able to get an answer to that question. If my hon. friend cannot answer the question I will not press it. The primary object of the commission, so far as we know externally at any rate, was to find out whether the trading in grain futures was inimical to the interests of the producer. That is right, I think. The other night, when my hon. friend's estimates were under consideration, I asked him whether he intended to appoint the supervisor recommended by the Stamp commission to see that everything was done on the up and up around the grain exchange. We both agreed that there was not very much urgency for it just now. Is that right? The government, I understood, had not finally disposed of the question but at any rate had not appointed any supervisor, and they did not think they were likely to. Did I understand my hon. friend rightly?


Henry Herbert Stevens: In regard to the supervisor, the question is referred to, at page 61 of the report, as a more or less tentative suggestion. I do not think it is what one would consider a primary recommendation from the commission. That appears at page 61. The commission indicate that it was suggested that possibly an official might be appointed to whom dissatisfied private producers or those selling wheat on the grain exchange could appeal and present their grievances, and such an official would be in a position to bring the matter privately to the attention of the officers of the grain exchange and make explanations to the dissatisfied party. I confess, speaking for myself, after what consideration I have given to the matter, that I do not think such an officer would be of any great value. I have an open- mind on the question however, and if there are any representations to be made I shall be glad to take them into consideration. But my conclusion is that, in the first place, Sir Josiah Stamp and his colleagues did not press that matter; and in the second place, on examination, I see no great use for it. So that no action has been taken.


William Richard Motherwell: 
Henry Herbert Stevens: Without doubt there was a considerable body of public opinion in the west that was suspicious of the system of futures in connection with the grain exchange, and I think the very thorough examination by the Stamp commission completely dispelled that suspicion from the minds of the producers. So far as I have been able to leam, there has been no agitation on that subject since this report was made, and I think the expenditure of the comparatively small amount for this work was money well spent, since it stabilized the general system of marketing western Canadian grain.


William Richard Motherwell: I do not want to discourage my hon. friend in what he thinks this report has accomplished, but I can tell him that instead of allaying suspicion it has aroused it. This report is the joke of the west; it is as dead as the dodo, as far as its effect is concerned in the manner suggested by the minister.


Henry Herbert Stevens: That is a contribution, in these blue times.


William Richard Motherwell: My hon. friend should make a contribution to justify the appointment of the Stamp commission and the printing of this report. As a matter of fact this must have been done for some other purpose altogether; that famous appendix, that was one too many, is believed by many people to have been really what was in the mind of the government. When we consider that the pool has been demobilized, as I have described it, and then has had the harpoon shot into it by this appendix which was taken out when it was too late, and after the damage was done, it is not a very creditable record for the government, especially in their attitude towards cooperative organizations. My hon. friend should dispel this notion, because the impression in the west is that the government is not very friendly to any kind of cooperative organization. I hope that impression is not correct but in any case, wittingly or unwittingly, the government has given the wheat pool a jab in the back which they did not like very well. They were pretty well staggered before that, and it was a badly calculated attack if that was its object. If that was not the object, this commission had no purpose at all except to blow in S 10,000.


Henry Herbert Stevens: I am quite certain that hon. members representing western Canada who are acquainted with the great difficulties with which the pools have been confronted in the last two or three years will not join in the sentiments expressed by my hon. friend. I
am always willing to give him a pretty wide latitude, but I must characterize the utterances to which he has just given expression as not only without foundation in fact but as gravely misleading to anyone who may read them. The government of the day, during last year and the present year, have rendered invaluable assistance and support to the pools, which could not have functioned without that support. The only ground for censure that might exist is that the government did guarantee the pools in both those years. We gave that guarantee because we felt it to be of great importance to this country that the pools should not be allowed to collapse. Whatever could be done was done gladly and freely and without any expectation of compensation of any kind. We took the risk, but fortunately because of the good management of these concerns during the last two years by Mr. McFarland and those associated with him, there has been no loss. I do think it unworthy of my hon. friend to suggest that the government has been an enemy of the pools. The pools have had no better friend in the last two years than the federal government. We have claimed no particular credit for it; we are not claiming any credit, but I am bound to defend the action of the government in this respect.


William Richard Motherwell: I was not saying anything about 'the guarantee, but my hon. frienid finds it convenient to slide out of it in that way. We were talking about the Stamp commission and why it was appointed. I can tell my bon. friend 'that a newspaper despatch appeared in both east and west when the government was considering the advisability of appointing this commission, and that despatch outlined almost exactly the procedure that was subsequently followed. That despatch described what was going to be done to the pool and who was going to be found' in the wrong, and it turned out as prognosticated as per Appendix XII. It worked out exactly as it was described in the newspapers even before Sir Josiah Stamp had accepted the invitation to come over here. Explain it how you will; there it is. No good purpose has been served, and if the government did not know about the Turgeon report they should have known it. So they will have to have some different explanation than can be given by talking about some other subject which we are not discussing at the moment, in order to convince the country that they had any friendly purpose towards the pool when the Stamp commission was appointed.
Just one other matter and I will foe through. During the session following my hon. friend's
Supply-Trade-Grain Act

return from France in 1930 he gave an account of his experience overseas and said that the visit of the Prime Minister to Paris had a very beneficial effect in the amount of wheat sold to France that year. I said I didn't think that had anything to do with it; if by going to Paris with his colleague the Solicitor General for a little visit the Prime Minister sold more wheat, he should have gone sooner and oftener and stayed longer.
As a matter of fact here is what happened: France had been using a certain percentage of foreign wheat. That percentage was steadily increased until now she is using about forty per cent of foreign wheat, and according to the press Italy is using nearly sixty per cent of foreign wheat. They are adjusting their quotas to suit their own requirements, and through that adjustment they are taking more foreign wheat now than they have taken for many years. Naturally we are getting some of that trade.
I wonder if my hon. friend still claims, now that the Prime Minister of Canada has given notice to France that the treaty is to be abrogated in a few months, that France and Italy and other countries are buying more of our wheat because of the visits of the Prime Minister .to Baris or because of anything the minister has done through the threatened abrogation of the treaties. I would like to know what my hon. friend thinks about it now, whether he still thinks these things can be done by just running down to Paris and later giving notice that the treaty is to be abrogated. Is France buying wheat because she has a fear that we will do something worse, or is she thinking about us at all or about any one other than her own people and their present bread requirements?


Henry Herbert Stevens: The Dominion government is at all times and under all circumstances doing its best to market Canadian wheat in foreign countries. I have already explained in considerable detail the system of quotas now in vogue and I do not think any good purpose would be served by my expressing again the opinions which I expressed last year.


John Vallance: Some prominent Canadians gave evidence before the Stamp commission. I should like to know if it is possible for any member of this committee to obtain a copy of the evidence of any particular witness who appeared before that commission.


Henry Herbert Stevens: As far as I know, the evidence is in the possession of the house.


John Vallance: That is the report based on the evidence.


Henry Herbert Stevens: I think the evidence itself is in the custody of the clerk. As far as I know I have not a copy in my department, but there is no doubt in my mind that my hon. friend could see the evidence at any time.


William Richard Motherwell: I did not catch quite clearly what the minister said in reply to my last question, but I understand now that he does not desire to repeat what he said a year ago. I can quite understand his not wanting to do that, because what he said at that time was absolute nonsense and was better not repeated.


Edward James Young: The newspaper article to which I referred a few moments ago is to be found in the Financial Post of April 9 on pages 1 and 2. I will send it over to the minister.


Mr. WEIR (Macdonald):: I hope the
minister has not definitely dosed his mind to the recommendation of the Stamp commission as to the appointment of a supervisor or some such officer to supervise the operations of the grain exchange. The fact that the report mentions that there is a certain amount of suspicion to be attached to future trading is sufficient evidence that such an officer might properly be appointed. Speaking a few moments ago about the export of grain from this country, the minister said that there had been a change of attitude on the part of the importing countries; I hope he did not mean that that applied to Canada alone.


Henry Herbert Stevens: Oh, no. I referred to the attitude of European countries which were operating under quota systems in the interest of their own producers and, of course, against all exporting countries.


William Gilbert Weir: Not against Canada alone?


Henry Herbert Stevens: Quite so.


William Gilbert Weir: I should like to know the attitude of the government with respect to the wheat pool, and latterly with respect to the three provincial organizations. Mr. McFarland has had nothing to do this year with the operations of the provincial organization; they are operating simply as grain handling propositions. As I understand it, the only part taken by the government is to back the notes at the banks. I am glad to say that quite a considerable amount of grain has been voluntarily pooled. A few days ago I noticed in the press that an instant payment

Supply-Trade and Commerce
of ten cents per bushel had been made on the grain pooled this year, and I should like to know if the consent of the government was required before that money was paid out?


Henry Herbert Stevens: I am afraid I cannot
answer that question, but my impression is that it was not.


William Gilbert Weir: The information has been given that there is not likely to be any loss with regard to pool operations so far as Mr. McFarland is concerned, and I should like to have some information in this connection. Under the operations of the pool, and prior to Mr. McFarland coming into it, although involving crops he handled, durum wheat was purchased with an initial payment of six or eight cents per bushel under Manitoba No. 1 northern. This wheat was all sold at a price above that received for Manitoba No. 1; in other words, the price of durum wheat went up considerably while the price of the other wheat fell. The result is that there is now coming to the growers of durum wheat in the province of Manitoba some
8500,000,	and when the statement is made that there is to be no loss in the operations of the pool, these growers are naturally concerned. A delegation waited upon the government a year ago at which time there was discussed the spreads between the different crops. I do not know whether the minister is in position to state that an effort will be made to straighten out this matter in order that these growers, largely in southern Manitoba and the Red River district, may receive this 8500,000, which is no small item to a certain class of growers. If the minister is not in position to give this information to the committee, I hope he will look into the matter.


Henry Herbert Stevens: I shall certainly look into
the matter, but I would have to state that this comes within, the purview of the pool itself. I shall check the matter over carefully and give my hon. friend any information I obtain at some later date.


William Gilbert Weir: The item is
really under the control of the government.


James J. Donnelly: The government announced last year that 2,000,000 bushels of wheat would be purchased to be ground into flour. I should like to know if this wheat was purchased through the department or through the Board of Grain Commissioners.


Henry Herbert Stevens: That purchase was in connection in part with the government of Saskatchewan and in part with the governments of the other two western provinces. It was for relief for the dried-out areas, which was carried on by the relief commission.


James J. Donnelly: The department had
nothing whatever to do with it?


Henry Herbert Stevens: No.


[Stage Direction]
Item agreed to.
National Research Council, $410,000.
John Vallance: I notice there is a decrease of 890,000 in this item, and I should like to know how the minister intends to effect this saving.


Henry Herbert Stevens: The National Research
Council is an important body and I have taken a tremendous amount of interest in it ever since 1916. I agree that as far as possible parliament should be generous with regard to this vote. This year, however, we felt we were warranted in curtailing the expenditure. Savings will be made in reduction of salaries and in fewer payments in connection with special grants for research work to young students and others throughout the country. We are carrying on any research work which is under way at the present time. For instance, some of the work extends for a period of two, three or four years, and that is being carried on, but we are limiting the amount of new work started.


Mr. BROWN:: Does the research laboratory at Winnipeg come under this item?


Henry Herbert Stevens: No, that is under the
grain commission.


[Stage Direction]
Item agreed to.
Motion Picture Bureau, $45,000.
Charles Gavan Power: Is it the practice of the
department to make motion pictures or to buy them?


Henry Herbert Stevens: Make them.


Charles Gavan Power: Does the department buy
any motion pictures, any made films?


Henry Herbert Stevens: On rare occasions some
that are of particular value or use may be acquired, but the department does not make a general practice of buying motion pictures.


Charles Gavan Power: Have any been purchased
during the last year?


Henry Herbert Stevens: One might be said to have been bought. That is, a separate company, not the officers of the department, took a picture in connection with salmon fisheries.

Supply-Trade and Commerce
This turned out to be a very valuable and useful picture which was shown abroad. It was one of those purchased and, I think, the only one purchased during the year.


Charles Gavan Power: Was a picture called "One
Family" purchased in England?


Henry Herbert Stevens: Yes. That was purchased a year and a half ago.


Charles Gavan Power: , Just what was that picture? How much was paid for it? * From whom was it purchased?


Henry Herbert Stevens: I have not under my
hand the exact data in regard to that. .1 think, speaking from memory, it was something in the neighbourhood of $10,000 or $12,000.


Charles Gavan Power: What was the subject matter of the picture?


Henry Herbert Stevens: It was a picture of childhood life in Great Britain, more or less of a patriotic character.


Charles Gavan Power: Was it a picture called "The End of the Road"?


Henry Herbert Stevens: No, it was more the beginning of the road, because it portrayed young life.


Charles Gavan Power: It was entitled "One Family," was it not?


Henry Herbert Stevens: Yes.


Eugène Fiset: Is it not a fact that this picture was prepared by the Empire Marketing Board in England?


Henry Herbert Stevens: Yes.


Eugène Fiset: 
Henry Herbert Stevens: It is being circulated as
one of the free pictures among the schools of the country. It must be borne in mind that certain pictures are in demand by the schools, particularly in the more outlying districts and, generally speaking, such pictures are supplied free. This is one of them, and it is rather an attractive one. I admit that from the standpoint of adult, cold-blooded, mercenary advertising it would not be classed as a valuable picture, but from the standpoint of portraying family life and a bit of sentiment and empire idealism, it has merit.


Edward James Young: Any creed attached to it?
Mr. STEVENiS: I did not succeed in having any creed attached to it, but had I done so it would unquestionably have become perfect. It is rather an attractive picture, in its portrayal of young life.


Albert Frederick Totzke: Is that why it appealed
to the Prime Minister?


Charles Gavan Power: What is the justification of
the Department, of Trade and Commerce buying a patriotic picture?


Henry Herbert Stevens: First, because the department is patriotic; second, because the administration of that particular activity is under the department.


Eugène Fiset: Has the picture ever left the vaults of the department?


Henry Herbert Stevens: Yes.


Eugène Fiset: I have grave doubts as to that. I think the minister had better make inquiries. Did the officials of the department recommend its purchase?


Henry Herbert Stevens: I have not that information before me.


John Vallance: During the conversion
loan advertising campaign I noticed extensive advertising through the medium of both silent and talking pictures. Would that naturally come out of last year's expenditure under this item?


Henry Herbert Stevens: No; all the advertising in connection with loans would be paid by the Department of Finance. Sometimes this department will take pictures for other departments.


[Stage Direction]
Item agreed to.
Weights and Measures inspection service, including the International Bureau of Weights and Measures, $310,200.
Jean-François Pouliot: May I make a suggestion
to the minister? If I am not mistaken, at the

Supply-Trade and Commerce
present time the charge for inspecting weights is $10, and this is paid by those whose weights are right as well as by those whose weights are wrong. Would the minister consider this suggestion: to charge less to those whose weights or measures are right, and more to those whose weights or measures are wrong?


Henry Herbert Stevens: That seems like a reasonable suggestion. I shall look into it and confer with the officials who have wide experience in the matter.


Jean-François Pouliot: I thank the minister for
his answer. The suggestion comes from a country merchant who told me that one day he received a visit from an inspector who inspected his balance. The balance could weigh, say 200 pounds and with the weights he was carrying with him, the inspector tested it to forty pounds and found it correct. As a matter of fact the balance was wrong from fifty pounds up, but the inspector marked it
O.K., and then the merchant refused to pay the $10. The inspector asked him why, and the merchant told him it was because the inspection was wrong, which he proceeded to prove. This is why I am drawing the matter to the attention of the minister.


John Vallance: Is any revenue derived from this service?


Henry Herbert Stevens: There is a surplus every
year of about $60,000.


James J. Donnelly: Does the department
supply the weights and measures inspectors in western Canada with a car, or allow them mileage to drive from place to place?


Henry Herbert Stevens: They are allowed mileage when it is required in the country places.


James J. Donnelly: What is the mileage
paid?


Henry Herbert Stevens: I am informed that it is
from eight to ten cents per mile.


Mr. CAYLEY:: How many inspectors are there ?


Henry Herbert Stevens: There are 115.


[Stage Direction]
Item agreed to.
Exhibitions and fairs, including the sum of $750, required by the Department of Immigration and Colonization, $137,000.
James J. Donnelly: Will the minister explain this item?


Henry Herbert Stevens: This is the usual vote for exhibitions. A substantial portion of the item is expended on regular exhibitions in Great Britain in the large industrial centres, and so forth, devoted almost entirely to exhibiting Canadian produce generally, lumber, fish, fruit, flour and all that class of goods. I can give the details of expenditures if required, but this is the usual vote. There is very little variation from year to year in the type of fair that is patronized. Occasionally a large fair or exhibition is involved, but there is no provision in this vote for exhibiting at any large fair.


James J. Donnelly: We sent people down to the Argentine to represent the Canadian government at an exhibition there a year or two ago. Would that come under this vote?


Henry Herbert Stevens: There was a special vote for that.


James J. Donnelly: The only thing I
wanted to remark in that connection was that before we sent our representatives to that exhibition we were selling to the Argentine $12,000,000 worth of produce annually, and the year after that exhibition we sold them only $-1,000,000 worth. If we send another such delegation with no better results, we shall soon be selling the Argentine nothing at all.


John Vallance: What is the $750 for
which is required by the Department of Immigration?


Henry Herbert Stevens: That is more or less a
vanishing item. Years ago the Immigration department did require certain small exhibits to be displayed in windows, made up by experts under this department, but that is virtually finished. This is just a small vote for some places they have left.


Mr. ELLIOTT:: There is a decrease of
$148,000 in this vote as compared with last year. How is that accounted for?


Henry Herbert Stevens: There are no large fairs
provided for under this item-just a number of routine exhibits.


[Stage Direction]
Item agreed to.
Dominion Bureau of Statistics, $512,000.
John Vallance: I assume the decrease in this item is due to the census work having passed the peak.


Henry Herbert Stevens: It is due to the tapering off of the census work.


[Stage Direction]
Item agreed to.
[Stage Direction]
Supply-Railways and Canals

[Stage Direction]
Canadian National (West Indies) Steamships, Limited
Loan to .the Canadian National (West Indies) Steamships, Limited, repayable on demand with interest at a rate to be fixed by the Governor in council, upon such terms and conditions as the governor in council may determine, and to be applied in payment of: -
Deficts in operation of the company and the vessels under the company's control during the year ended December 31, 1931, and interest requirements. Additional amount required in excess of the sum of $755,000 already appropriated, $161,568.53.
Robert James Manion: This is a supplementary item which has passed the special committee.


[Stage Direction]
Item agreed to.
Hudson Bay railway and terminals: construction and betterments, including E- B. Jost at $2,250 (revote $630,000), $1,937,700.
Eugène Fiset: Is this to complete?


Robert James Manion: It just depends on what we mean by complete. It would hardly be correct to say that it would complete the work, but it will put the port in condition to carry on with any reasonable amount of shipping that may go out there this year. Briefly, it will build a shed which will be necessary to handle package freight of any kind, it will complete the work on the elevator so that it can handle quite a large amount of grain; it will do some work on the water supply, do some filling and some dredging and considerable work on the Hudson Bay railway itself, such as ballasting and levelling up the road, which is always necessary in that country after the winter's settling. In general it will put the whole system in shape to handle any reasonable amount of traffic that may go over it this coming year.


James J. Donnelly: Is it contemplated building docks there for coal?


Robert James Manion: There is a dock eighteen hundred feet long, at one end of which there is plenty of room to store coal. There is no intention of putting up a special dock or getting special equipment this year for handling coal. There are two locomotive cranes which can handle any coal which may come in there this coming season. If it is shown throughout the season that there is likely to be a heavy amount of coal coming in through that port later, it is the intention in the coming years to build a complete dock, 'but with our present equipment we can handle any coal that may come in from either Nova Scotia or Great Britain this season.


Thomas Reid: What freight rate was charged on the trial shipment going over that route?


Robert James Manion: 'It was all charged on the Crowsnest basis to the head of the lakes.


Thomas Reid: Was that rate made by the government?


Robert James Manion: No, the government does not make rates. The rates were made in this case by the Canadian National Railway itself, subject of course to revision by the Board of Railway Commissioners. I adhere to what I said earlier in the evening, that the government does not make rates.


Mr. SPEAKMAN:: From what I gather in the press, I understand that some difficulty was experienced last year in securing this first shipment of grain to go out over the Hudson Bay route, that different grain companies and other people shipping grain seemed dubious about sending it over the route, which did not exactly bear out their enthusiasm for the route in the first place. Without my putting a lengthy series of questions to the minister, would he give us a brief statement as to the success of that trial shipment, the amount of grain handled, the terms and conditions on which it was handled, the costs borne by the government, and the result from the point of view of the shipper.


Robert James Manion: I shall gladly answer the hon. member. I shall have to resort to my memory, but I think it is quite clear in this connection, because I was deeply interested. The hon. member is quite right: last year we had considerable difficulty obtaining anything in the shape of grain cargoes. In fact I will tell now that which I did not state publicly last year, namely, that we communicated with various organizations, both public and private, in western Canada, and we had no success whatever so far as securing grain shipments was concerned. We took considerable abuse because we had not obtained grain shipments, despite the fact that we had done everything in our power to get them. At last we went to John I. McFarland-I do not know his position-


John Vallance: Manager of the central selling agency.


Robert James Manion: Yes,-who was appointed by my leader, the right the hon. Prime Minister.


Some hon. MEMBERS:: Oh, oh.
* Mr. MANION: Mr. McFarland came to the city of Ottawa-


John Vallance: The minister has just admitted what the Minister of Trade and Commerce would not admit.

Supply-Railways-Hudson Bay


Robert James Manion: Well, perhaps I used the wrong word.


John Vallance: No, your statement is absolutely true.


Robert James Manion: I am quite sure Mr. McFarland was suggested by the Prime Minister; perhaps I should have put it that way. It is quite possible the Minister of Trade and Commerce knows more than I do in regard to the selling agency as it comes within his purview. Probably I slipped that word in without going into the question. I frankly admit that the Minister of Trade and Commerce is correctly informed concerning Mr. McFarland's appointment, and I shall withdraw my remark.
However, to get back to my statement, may I say that Mr. McFarland held the position of manager of the selling agency. He came to the city of Ottawa and after the solicitation of the Prime Minister and myself-I might say the pleading-we got Mr. McFarland to supply us with two cargoes of grain to be shipped via Churchill.


Edward James Young: Is that how it came about that Mr. McFarland bought wheat for future delivery?


Robert James Manion: My hon. friend had better ask Mr. McFarland about that. He supplied two cargoes. Then, while the government was not in the shipping business, and had nothing to do with the chartering of ships, and should have had nothing to do with business of that nature, in an effort to have a trial shipment through the port of Churchill we chartered two boats and guaranteed to Mr. McFarland that the handling would cost no more than if shipped via Montreal. The boats went in and handled the grain very successfully. Delivery of the elevator was made on the fifteenth; loading was commenced the same evening and continued until the ships were completely filled and trimmed. The experiment was quite successful, and my understanding is that the cost was slightly lower than it would have been had the grain been shipped via Montreal. I may add that we were to absorb port charges, elevator charges and any other charges which ordinarily would have been levied. Outside of that every charge was paid, including insurance, which was rather heavy. In every way the sending of these cargoes via Churchill was a complete success.


William Thomas Lucas: Could the minister give us an idea how insurance rates via Hudson Bay compare with those via Montreal?


Robert James Manion: I cannot say exactly, but they are considerably heavier. I believe the rate is about five times as much, perhaps six times, via Churchill as it is via Montreal. I can say at least that that condition prevailed last year.
While I am on my feet I should like to add that through the office of the Canadian High Commissioner at London we have taken up the matter of insurance rates. The Department of Marine has also investigated the matter because it is directly in>
control of insurance. The Canadian High Commissioner's office at London has passed the matter on to the Imperial shipping committee, in whose hands it now rests. My best information at the moment is that no reduction has been made. It has been more or less promised, however, that if shipments this year are as successful as those of last year, there will be a reduction in insurance rates in 1933. I am afraid that there is not a very great prospect of a reduction this year.


Alfred Speakman: I heard the minister mention the fifteenth of a certain month, but I did not hear the month.


Robert James Manion: September.


Albert Frederick Totzke: I should like to ask the minister if he -oan tell us whether any steps are being taken to ensure further and perhaps more complete trial shipments in the coming
season.


Robert James Manion: Yes, every effort has been made. I must admit quite frankly, however, that we have not been very successful. A series of letters has been sent to grain dealers throughout western Canada. Shipping agents from Montreal have gone through the western provinces endeavouring to work up shipments. They assure me that they 'think there will probably be about ten or twelve ships go out of Churchill in the coming year. Frankly it has been very difficult to get cargoes going out or coming in. One shipping company, the Dalgleish Company-the same people who handled the shipment last year-have offered to take cargoes into Churchill on the same basis as the Montreal rate, provided they can get 1,000 tons, or about one-fifth of a cargo, to take in. In spite of that fact it has not been easy to arrange shipments. We have received very little encouragement, and these shipping agents have had difficulty in securing cargoes.


William Richard Motherwell: Does that cover
insurance, too?

Supply-Railways-Hudson Bay


Robert James Manion: Yes. They are hopeful that ten or a dozen ships will go into Churchill, which would constitute a pretty fair trial in the coming year.


Albert Frederick Totzke: Would there be any doubt about having wheat at the port, in case shipments had to be made?


Robert James Manion: There will not be trial shipments until there is wheat to go out.


Albert Frederick Totzke: If the boats are ready to take those shipments out-


Robert James Manion: The boats will not go unless the wheat is there.


Albert Frederick Totzke: I shall put the question another way: if wheat is there the boats will go?


Robert James Manion: The wheat will be there only if some agency in western Canada does as Mr. McFarland did last year. That is, some agent in western Canada must sell wheat, as Mr. McFarland did. We are not shipping wheat, because we are not handling it.


John Vallance: The minister must admit that the government will not guarantee bottoms to any western grain shipper shipping out of Churchill. You guaranteed Mr. McFarland two bottoms in which to ship his grain. In other words he guaranteed you the grain to make trial shipment.


Robert James Manion: There will be no difficulty whatever in getting bottoms. The difficulty is not to get bottoms or to get rates equal to those of Montreal; it is to get cargoes. There will be no difficulty getting cargoes if-


John Vallance: But-


James J. Donnelly: Will the minister-


Robert James Manion: If my hon. friends will ask their questions one at a time I shall have a better chance to answer. Just now three or four questions are being asked at once from different sections of the chamber.


John Vallance: What difficulty will be encountered at Churchill?


Robert James Manion: The difficulty seems to be that western Canada shippers are not enthusiastic about shipping through the port of Churchill, and are not anxious to make arrangements to do so. The late government and the present one-I divide the credit- have put the port into good shape. We had no machinery for shipments; we had no machinery for buying and selling grain in this country and marketing it in Europe, or for

chartering vessels. We went out of our way and put this machinery into operation, because we felt it would be a black eye to Churchill if we did not do it. There is no difficulty whatever about getting ships provided the cargoes are there. I do not wish to be misquoted, but I am very hopeful that there will be sufficient to give ten or twelve cargoes out of Churchill this year. If there are cargoes there will be no difficulty about getting the ships.


William Gilbert Weir: Has the minister offered the people any consideration at all in the way of reducing the elevator handling charges, or is there the same arrangement as there was last year?


Robert James Manion: There was no charge last year, so that we cannot very well reduce it.


William Gilbert Weir: Then you have the same arrangement?


Robert James Manion: We have not had anything put up to us along that line. We will do everything we can, and gladly, to encourage anyone to utilize the port this coming year. As I have said, however, we cannot reduce the charge because there was none last year.


William Richard Motherwell: Does not my hon. friend think that it is the excessive insurance rate that terrifies the prospective shippers? They do not like to take a chance. Has the government thought of carrying part of the insurance until the port has had a real chance to work out?


Robert James Manion: I do not think my hon. friend is right in saying that the excessive insurance rate frightens people, because after all what people look at is the through rate, including insurance. What they consider, for instance, is the rate from Saskatoon, which would probably be the shipping point to Liverpool; they would take that rate, via Churchill, and compare it with the rate from Saskatoon to Liverpool via Montreal, and if the rate, inclusive of insurance, were lower via Churchill than via Montreal, it should be attractive to people wishing to ship grain. As regards absorbing insurance, whether I have thought of this matter or not, it has been forced upon my attention. But may I say it is not an easy matter to settle, for this reason. If that were the only thing that held up shipments via Churchill, it would be the duty of the government to do something in that regard, as a trial; but in my opinion that is not the reason that may make it difficult to get cargoes. It is probably a question of world depression, and general business con-

Supply-Railways-Hudson Bay
ditions. The difficulty arises again in regard to the absorption by the government of insurance so far as the other ports are concerned. The other ports, both east and west, would rightly say, "Why should the insurance be absorbed in one port and not in another?" Montreal or Quebec would probably come forward with such a representation. They might say, "If you are going to absorb insurance from Churchill, why not absorb it from Montreal and Quebec?" It is not therefore an easy matter to settle, and we do not wish to grapple with that problem unless it is absolutely necessary. And I do not think it is necessary, because the rate this year will be as low as the Montreal rate, if not lower. There was a difference of about two cents per bushel last year.


William Richard Motherwell: Trade and traffic
will not as a rule seek a new port unless there is some advantage to induce shippers to do so. Switching traffic from one route to another is a very difficult thing and takes a considerable time to accomplish. When the Panama canal route was first opened, via Vancouver, it remained open quite a while before there was any considerable traffic, especially of grain. Experimental shipments were made there too, as there was a fear at that time that the waters of the southern Pacific would have a deleterious effect upon the keeping qualities of wheat in transit, particularly if it had excess moisture. These difficulties were overcome and elevators constructed, but it must have been six or seven years before any considerable volume of traffic went through that port-a port open the year round. They had high mountain rates to overcome at that time also, there were no Crowsnest rates going then to the Pacific. That was no doubt a handicap. But here is the point. The government, if this route is to be successful, must do something to overcome the fears of the people with respect to rates and all the vicissitudes or possibilities of any new route, I do not care where it is. The route by the Panama occasioned fear because of the warmth of the water, and we can understand that the northern route might occasion fear because of the coldness of the water or because of the presence of icebergs or growlers or whatever there is to make people fearful; and unless there is a considerable volume of cargo produced, pressing for an exit, that port will be very slow developing without the sympathetic support of the government. Its development, I say, will be slow unless the government gives it considerable sympathetic
and tangible support of a practical nature such as I have indicated. The minister must realize that this is the history of trade the world over. It takes a great amount of effort and time to swing trade from one route to another, and there must be a good deal of cargo offering and pressing for a favourable exit before switching can possibly be made. The government, I repeat, should show us a more sympathetic consideration of a practical sort in the direction I have indicated, otherwise, for a long time to come, that port will not be used to any considerable extent. It will not be as fully used as it might be, because shippers will not use any new route to an appreciable extent until the advantages and risks are more fully known.


Robert James Manion: I remember that when the Panama route was first opened there was a fear in regard to the effect of the warm waters of the Pacific on grain. To-day, however, there is no such fear in connection with the northern route; in fact the northern waters will rather make it a safe route from that point of view. I think my hon. friend will admit that his government when in power and this government as well have shown great sympathy with the route. Last year we did, as we are doing this year, everything possible to encourage its utilization. I made inquiries to find out how much it would cost to send a ship for one trip. Suppose we sent a ship on the off chance of a cargo; it would cost from $30,000 to $40,000, and that is a nice figure to juggle with unless you are sure of your cargo. May I make a suggestion to my hon. friend and to members from the west generally, who pressed for many years for the building of the railway and the opening of the port. I submit that they also owe a duty to it. Considering the vast amount of money spent upon the route, and the fact that the people of eastern Canada were for many years accused of holding it up, when as a matter of fact the delay was due to war and other conditions; and considering the further fact that $50,000,000 odd has been spent upon the undertaking, I say frankly that I doubt whether western Canada itself is showing the interest it should in the problem, in the shipping of grain and other products I have been listening to a good many lectures from the west, and I respectfully submit that western Canada might listen to me in this regard. I have been listening to them a good deal. I am not saying this in any spirit of disrespect, but I do think that some of the organizations out there, which are very strong on

Supply-Railways-Hudson Bay
resolutions, might get to work and do more than pass resolutions; they might hunt up cargoes for Churchill. They should do a bit of the work which is not the duty of the Department of Railways or of the people of Canada as a whole.


William Richard Motherwell: We are all broke
up there now, and need help to get this new port started.


Mr. BOWMAN:: Have requests been made to the big grain companies of the west to furnish a cargo this year?


Robert James Manion: Yes; requests have been forwarded to the big grain companies, the pools, boards of trade and so forth. I have here a lengthy list of those to whom we sent such requests, and, I have seen a few of the answers. I may say that they were not enthusiastic. Last year I pleaded with the people of the west to ship grain through the port because I felt that it would be a black eye not only to Churchill, but a political black eye to us, if we did not get something through the port then.


William Richard Motherwell: I think so too.


Robert James Manion: My hon. friend is better
at painting out that it would have been a political black eye to us than he is at giving us credit for what we did do. Last year, I may say, I spoke to one big grain merchant- I will not mention his name. I had a com-versation with him in the lobby and asked him whether he would send any grain. He replied, "No, I will not send grain through Churchill. If you give me five or six cents better than the Montreal route offers I will ship through that port."


William Richard Motherwell: That is the point.


Robert James Manion: Otherwise, he said, he
would not consider it at all. And as a matter of fact he did not have anything to do with it. This year, as I have said, we sent letters to the boards of trade, and, frankly, we have not had satisfactory replies, but only pious wishes.


Charles A. Stewart: Why does
not the minister communicate with the On-To-The-Bay Association?


Robert James Manion: They have been communicating with me.


Charles A. Stewart: Won't they find you cargoes?


Robert James Manion: Without intending any
disrespect to the association, I may say that I was really thinking of them when I said

that if certain organizations would stop passing resolutions and hunt up cargoes instead we might make some headway.


Charles A. Stewart: They used
to be active in our day.


Robert James Manion: The association is still very active, but frankly, it does not supply us with cargoes. I should be glad to have their activities take that form.


John Livingstone Brown: I agree with the minister.


James Langstaff Bowman: What advantage, in so
many cents, or fractions of a cent per bushel, did those cargoes have last year shipped through the bay over cargoes from Montreal?


Robert James Manion: I cannot remember exactly, [DOT]but it was in the neighbourhood of two cents. Two cents a bushel is quite a difference, and that difference was so great that Mr. McFarland came back to us and proposed that he should pay some of the charges we had not asked him to pay. He felt that he had done so well that he could pay some of the charges we had expected to pay.


James Langstaff Bowman: Will the government be
prepared to make the same concessions this year?


Robert James Manion: I do not know that there is any necessity to make concessions, because there will be no difficulty at all in getting ships on the same basis. I do not think there will be any difficulty in getting rates out of Churchill that will be perhaps a little better than the rates of last year.


Peter John Veniot: Have any negotiations been carried on with regard to the transportation of coarse grains to the maritime provinces via Hudson bay?


Robert James Manion: I have heard nothing of that suggestion, but we will be open to hear all proposals of that kind, coming either from the maritimes or from the west.


Peter John Veniot: The reason I asked was because I might not be allowed to ask that question when the agriculture estimates are up. I have some memory of a statement by the Minister of Agriculture that it was hoped that large quantities of coarse grain could be shipped to the maritime provinces through Churchill for the feeding of cattle on their way to Europe. I wanted to know if that had been considered by the government.


Robert James Manion: If the Minister of Agriculture expressed that hope I have no doubt the hope was in his mind, and if it will please my hon. friend I will hope so too.

Supply-Canals-Welland


James J. Donnelly: Are there still aviators investigating the course of Hudson strait?


Robert James Manion: No, there are no aviators up there now, but the vessels were so successful last year in coming in and going out that we anticipate no difficulty. We have direction finding stations there in excellent shape, and I would be a little afraid to quote the very complimentary remarks of some of the captains in comparing Churchill with some other ports. So I do not think there will be any difficulty in that regard.


James J. Donnelly: Can the minister tell us about what time the straits were frozen last year?


Robert James Manion: I am afraid I cannot give that information offhand, but they are open roughly from the middle of July to the middle of October. Last year I think they were open later in the fall, because the season was very mild.


Charles Gavan Power: Has there been any proposal to stock Hudson bay with fish from Nova Scotia?


Charles Edward Bothwell: Has any action been taken on the resolutions which have been forwarded by various boards of trade in the west in connection with freight rates to Churchill?


Robert James Manion: Yes, that is being dealt with at the moment by the Canadian National Railways, and we expect to have them publish rates in the very near future which I hope will be very satisfactory.


William Richard Motherwell: I think if we have
even an average crop this year it will be pushed to the market as rapidly as possible because of the urgent need for liquidation, and I believe every exit will be required. If there is a crop like last year, however, the grain will likely go out largely via the old lines, the lines of least resistance. I would warn the government, however, that the people are in rather a distressed and complaining mood; the shoulders of the government are looked upon as broad, and the people will be apt to blame the government, whether they deserve it or not, unless that road is used to the fullest possible extent. I think the government would be well advised to get busy and not wait to be jabbed up too much by the On-to-the-Bay Association or anyone else. If there is a normal crop I do not think any difficulty will be encountered, as every avenue of egress will be used.


Alfred Speakman: The government might conscript some grain.


[Stage Direction]
Item agreed to.
*1761-132
Canals-Welland ship canal: construction and betterments, $3,123,400.
Mr. SPENCER:: Could the committee
have some information on this matter?


Robert James Manion: This vote is practically
for the completion of the Welland ship canal and other supplementary works necessary at that point.


Eugène Fiset: There is another
item later on in connection with this canal for $25,900.


Robert James Manion: I shall explain that item
when we reach it.


[Stage Direction]
Item agreed to.
Port Colborne elevator, improvements, $1,180.
Jean-François Pouliot: Is this elevator completed?


Robert James Manion: Yes.


Alfred Speakman: How much grain went through this elevator last year?


Robert James Manion: About 30,000,000 bushels.


[Stage Direction]
Item agreed to.
Progress reported.
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Monday, April 18, 1932