[Stage Direction]
Mr. A. W. NEILL (Comox-Alberni) moved for leave to introduce Bill No. 112, to amend the Immigration Act.
. Some hon. MEMBERS: Explain.
Mr. NEILL:: Mr. Speaker, the house seems to have a perfect yen for asking explanations about my humble, unobtrusive bill. If it is not one section asking, it is another section demanding. There have been so many bills reprinted in the last few days, this seems to be a sort of legislative Easter. This bill is the resurrected body of Bill No. 38, iwhich was crucified three days ago by the application of a fifteen-year-old rule for which there did not seem to be very much precedent. It now comes before us clothed with explanations, as with a garment, like some beautiful and ostensibly repentant Magdalen knocking at the doors of society for reentry. I hope it will be received with that kindly interest that society always does accord to people with a lurid past when they are fair to look upon and when their sins are sickbed o'er with the pale cast of repentance.
The bill is exactly the same as the one introduced on March 9; the two are identical, word for word, with the exception that the date is different. On an attached sheet, but

2838	COMMONS
Supply-Transport-St. Lawrence Dredging
not forming part of the bill, are to be found certain explanations required by law and I shall be pleased to read them if necessary, though that would take some time. I suggest that I might epitomize the explanation by saying that the purport of the bill is to extend and amplify to a small extent a section of the Immigration Act that has been in force for some twenty-five years, which applies the educational test to immigrants. Those who really want to see further into it will find it set out at page 2735 of Hansard of May 10.
I am sure that, relieved of its handicap in the form of a lack of explanation, the bill will now be treated on its merits and have a pleasant, prosperous and speedy passage through the house.
Motion agreed to and bill read the first time.

The house in committee of supply, Mr. Sanderson in the chair.



DEPARTMENT OF TRANSPORT

[Stage Direction]
River St. Lawrence ship channel-contract dredging in the St. Lawrence river and Montreal harbour, and the extension of existing weirs, including cost of administration-capital, $2,933,400.
Mr. PELLETIER:: I believe the minister had begun the other evening to give an explanation of the disposal of the St. Lawrence dredging fleet. Before we proceed further perhaps he would like to resume what he was saying on that occasion.


Hon. C. D. HOWE (Minister of Transport):: The hon. gentleman was speaking at the close the other evening. He called it eleven o'clock. Perhaps he would like to continue.


René-Antoine Pelletier: Shortly before eleven o'clock I had just begun to point out that three of the contentions advanced by the minister were not, in my opinion, quite accurate. In the first place he told us that the government began to give out contracts for the dredging of the St. Lawrence in 1929 because it realized the necessity of hurrying the work in order to provide a thirty-five foot channel. The records show that contracts were given quite a few years before 1929, but what strikes me as most peculiar is the information brought down by the minister in which he states:
The number of dredges employed by the contractors and by the department on the St. Lawrence work has varied from time to time and it has happened that work has been done by contractors' dredges when departmental dredges were not fully employed. This has been due in part to the urgency of the work.
(Mr. Neill.]
If the work was really so urgent, why were the government dredges doing nothing when contracts were given out to contractors?
The second point which the minister discussed the other day was the Sorel shipyard. He told us that the Sorel shipyards, to use his own words, were maintained simply to repair the government dredging fleet; that that was the yard's main work. I do not think that is quite an accurate picture. It would lead us to believe that the Sorel shipyard was nothing but a repair yard. That is not so. I said the other day, and I repeat it, that the Sorel shipyard was equipped to do a great deal more than mere repair work; it was equipped not only to repair but to build vessels. In proof of that I would point to the number of vessels that were being built in certain years. For example in 1925 two vessels were building; in 1926, eight; in 1927, twelve; in 1928, ten, and so on. So to say that the Sorel shipyard was simply a small affair without much equipment is far from accurate. The Sorel shipyard was equipped not only to build vessels, but even to manufacture the marine boilers required therefor. Furthermore the number of employees at the yard goes to show that it could not have been a small establishment. The minister stated the other day that at times there were between nine hundred and one thousand men employed, so certainly the capacity was much greater than the minister indicated.
But the most important aspect of this deal is the question of valuation. The minister told us the other night that he had asked a private company, the Canadian Appraisal Company, to make a survey of the equipment which was to be sold, and that he based his calculations upon such survey. I believe if we studied the story of the valuation we should find that there is a great deal more to be said than just what the minister told us the other day. For example I have in my hand a part of the return brought down by the minister, showing on page 9 a summary of appraisal values by the Canadian Appraisal Company. I should like to discuss item No. 1, which reads as follows:
Land, including wharves, railway sidings, paving, fences and drainage, value, $60,000.
I believe that valuation is entirely wrong, and I propose to give figures taken from the department's own records to show what the government paid for the land in the first place, proving positively that the valuation of $60,000 is a ridiculous figure in the face of what it cost the government.
On May 26, 1932, the following purchases were made at Sorel: parcel 442, 4,356 square

Supply-Transport-St. Lawrence Dredging
feet; parcel 443, 4,356 square feet; parcel 444, 17,424 square feet; parcel 445, 15,130 square feet; a total area at that time of 51,266 square feet were purchased. The purchase price was $18,316.62, which means roughly 35 cents per square foot. I refer not to the buildings or improvements but to the actual land itself, upon which there can be no such thing as depreciation. This deal was made in 1932 at the lowest point of the depression, and one has only to read the speeches of the then leader of the opposition to know what the condition of the country was at that time and how low values were. Therefore that price of 35 cents a square foot was paid by the department at a time when values were at the lowest possible level.


Clarence Decatur Howe: What land is it that the hon. member is referring to? Where is it located?


René-Antoine Pelletier: I have given the minister the parcel numbers.


Clarence Decatur Howe: Is it part of the shipyard property?


René-Antoine Pelletier: Yes, I believe it is now.


Clarence Decatur Howe: The hon. member does not know whether it is or not.


René-Antoine Pelletier: It is land that is now part of the shipyard property, commercial land used for that kind of purpose in the town of Sorel. Since the shipyard property is in a much more valuable location, I imagine it would be more valuable than other property.


Clarence Decatur Howe: Downtown property in the town of Sorel?


René-Antoine Pelletier: The situation at Sorel is this. The Richelieu river runs into the St. Lawrence there, and the best possible industrial locations would be immediately at the junction of the two rivers. That means that there is water frontage on two sides, an ideal condition for property for that purpose. In any event these are prices paid by the department for land there, and I take these parcels as examples because they were purchased in 1932 at a time when values were known to be low.


Clarence Decatur Howe: My hon. friend stated that this land was purchased by the government and later sold, and he has just told us something which would indicate that nothing of the kind took place. Suppose he apologize to the committee for giving false information.


René-Antoine Pelletier: I do not believe I have given false information. What I am trying to do is to establish the value.


Clarence Decatur Howe: Did the hon. member say, or did he not, that the land was purchased and then sold?


René-Antoine Pelletier: Let me put it this way. I am establishing the value of land around that point.


Clarence Decatur Howe: Let us have this straight. The hon. member either can or cannot tell the truth, and we want to know.


Some hon. MEMBERS:: Order.


Clarence Decatur Howe: Is this land that was bought and later sold, or not?


René-Antoine Pelletier: If the minister is incensed now he had better reserve his comments until later, because this is just the beginning. What I am trying to do is to establish the value of land in that particular location, and I am taking the year 1932 when this deal was made in order to have the lowest possible valuation that can be made.


Clarence Decatur Howe: Is this land in the town of Sorel?


René-Antoine Pelletier: I have given the locations.


Clarence Decatur Howe: It is part of the town of Sorel?


René-Antoine Pelletier: I believe that parcels 442, 443, 444 and 445 are either in St. Joseph de Sorel or in Sorel.


Clarence Decatur Howe: Which town is the shipyard in?


René-Antoine Pelletier: It is in St. Joseph de Sorel.


Clarence Decatur Howe: And not the town of Sorel?


René-Antoine Pelletier: It is across the Richelieu river from the city of Sorel.


Clarence Decatur Howe: But not in the town of Sorel; in other words it is in the parish of St. Joseph?


René-Antoine Pelletier: Possibly so; it is across the river.


Clarence Decatur Howe: So the hon. member quoted a number of assessments on property in the town of Sorel the other day just for window dressing, is that it? They had nothing to do with the shipyard, because the shipyard is not in the town of Sorel. Is that the idea?


René-Antoine Pelletier: How can the minister get away from this explanation? This is the value of industrial land in that part of the country. If he figures that the government paid too much at 35 cents a square foot I am willing to take a much lower figure, and I can still show the minister a great discrepancy between the $60,000 the Canadian Appraisal Company said it was worth and the true value. So, continuing with these figures, we find that the land eventually sold was not a matter of simply a few hundred thousand
2840	COMMONS
Supply-Transport-St. Lawrence Dredging
square feet. I believe the actual acreage was 34-93, that is to say 1,521550 square feet. That is the land that was sold, according to a return made by the minister himself. If we figure out the value of 1,521,550 square feet, at the price paid for it by the government when values were at their very lowest, we see that this gives us an amount of $543,042.50.


Mr. DUNNING:: My hon. friend again
says, if we figure it out at what the government paid for it, suggesting that what he is referring to is the land which was sold. He is either talking about the land which was sold or he is not. Again he is creating the impression that the figures he gives as to value apply to the land now under discussion, whereas a few moments ago he admitted that it is not the land at all, that he is using these figures for purposes of illustration.


René-Antoine Pelletier: I could very well use the figures for the shipyard itself, because that information was brought down in this house. The trouble with that is with regard to one figure; something over twenty-four acres are shown without any value at all. They appear as a gift from some other department, so it is impossible to establish the true cost to the government. Furthermore, how else can we ascertain the value if we do not take into consideration the value of properties adjacent to the property we wish to sell? You must have some basis of valuation, and here I am taking land which the government itself purchased at 35 cents per square foot. If that figure is too high I can put it at 25 cents and still show a discrepancy.
In passing I should like to point out that this $60,000 was not the actual amount realized by the Canadian government from the sale of this property. In reality the amount realized was only 80 per cent of that figure, so actually this land brought a return of some $48,000, when it was worth at least $500,000.
Let me go further with these values. We could group together several items. Let us take items 1 and 2, which are valued in the report of the appraisal company at $60,000 and $129,789 respectively, making a total of $189,789. Item No. 1 covers wharves, railway sidings, paving, fences and drainage, while No. 2 covers other properties. As was mentioned the other day, the assessment roll of the city of Sorel values the government property at more than a million dollars. The minister may claim that the shipyard is located in St. Joseph de Sorel-and that some of it remains unsold and

is still in the possession of the government. I am prepared to take the minister's explanation in that regard, and it is possible that the valuation covers more property than was sold. Nevertheless I believe I have shown that the valuation of that particular land is not at all fair, and that it has resulted in quite a serious loss to the Canadian government.
We might go further and take up the question of the equipment itself. The instructions from the minister to the appraisal company were that a fair valuation was to be placed upon this equipment. Let us turn to item No. 10, which includes the dredging fleet at Sorel and Quebec. The valuation shown by the Canadian Appraisal Company is $1,534,750, and of that amount eighty per cent was received as the sale price, that is to say $1,227,800. Now let us compare that price with the cost to this government of some of that equipment. It may be all right to tell us that this equipment was absolutely obsolete, but I am not going to deal with any obsolete equipment. I am going to mention two pieces of that equipment which together cost the Canadian government more than was realized from the sale of all this equipment to this private firm. We have dredge No. 16, built in 1923, and dredge No. 17, built in 1931. These two dredges alone cost more than the total amount realized by the government from the sale of all the equipment. Dredge No. 16 cost $837,200 and dredge No. 17 cost $444,535, or a total cost to the Canadian government of $1,281,735.


Mr. BOTHWELL:: Is the hon. member
able to give to the committee the proper depreciation from year to year on equipment of that kind?


René-Antoine Pelletier: Well, Mr. Chairman,
even if these two dredges depreciated to such an extent that they vanished, still there would be the rest of the equipment to take into consideration. Perhaps it is necessary to read the list of equipment and show the cost prices. Here we have dredge No. 3, at south channel; value for scrap, $7,500. Then there is dredge No. 4, also valued at $7,500, which originally cost the government $94,564. This was an old dredge, and it may be that this value is approximately correct. Dredge No. 5, built in 1927, was valued at $70,000 and cost the Canadian government $388,952. Dredge No. 8, built in 1907, cost the government $450,435 and was valued at $150,000. It is worthy of note that this dredge was rebuilt in 1928 and changed to a bucket dredge, so that the original cost would have to be increased to

Supply-Transport-St. Lawrence Dredging
the extent of about $150,000. Then there were dredges Nos. 12, 13, 14, 15, 16 and 17, and No. 18 which is not yet finished. There was also Churchill No. 1, built in 1928. There were also several tugs; in fact in all, apart from the two pieces I have mentioned as costing the Canadian government more than the total amount realized for the equipment, we find that there were included fifty-nine other pieces of floating equipment which so far have not been mentioned.
When we find that these two dredges alone cost that amount of money, what are we to say? Has the depreciation on this equipment been so heavy that they might be said to have vanished into thin air? When it comes to the matter of depreciation I should like to relate the stoiy of one particular dredge, which will indicate that this equipment was still capable of doing work for some considera-able time. It must not be thought that a dredge which cost the taxpayers of this country some $444,000 in 1931 would become scrap in 1937. I do not believe that that is possible, no matter how much work it has done. If, then, these figures are not satisfactory to the minister and do not indicate to him that the appraisal of the Canadian Appraisal Company was certainly not in accordance with the valuation placed upon the property, let me return to the auditor general's report.
The other day the Minister of Finance mentioned that the auditor general always gave us accurate figures. I believe he does, when he gets them. But there are times when he does not get them, and that is what I meant the other day. The Minister of Transport has not yet given us a satisfactory explanation as to why no inventory was made prior to 1936. It is true that the minister has not always had this particular branch under his administration; I know, for example, that this matter was given to the minister only within the last few years. He could not possibly have known what had been going on in the past, and the remarks I have just addressed to him to-day are remarks which really should be for those who administered this department before he became its head. However, he must now be in a position to provide us with a satisfactory answer.
I did mention the auditor general's report; apparently it is found that there might have been some misunderstanding about it, so I have brought with me to-day the auditor general's instructions concerning values. It was maintained that these were original values, without any depreciation having been placed upon them. That is not so. I say that simply because the first inventory was
made in 1936; it appears in the report of the auditor general for the first time in that year. Four months later the dredging fleet was sold. There could not have been any change in those four months; at least there could not have been depreciation to warrant anything like the depreciation claimed. What are the instructions of the auditor general? Let us go over them:
In either case the inventory should be prepared to show the total value of such property on hand.
Then he tells us how to arrive at that value. Then, in regard to values-
I wish to point out that as the principle of depreciation is not being observed-
Mark this,
-under the policy of the government respecting the value of public property in general, it is not intended that depreciation should be considered. It is suggested therefore that property values once established-
And this is my point-property values "once established" for the first time; and they were established in the report of the auditor general under date of December 31, 1936. In this particular case they had not been established before, because no inventory was ever supplied to the auditor general. Therefore the values once established were the values established on December 31, 1936, as instructed by the auditor general. He says:
-either on a cost or an estimated basis, should be maintained unchanged in your records from year to year until such property is finally disposed of-
In this particular case the property was disposed of only four months after the valuation took place. So that it cannot be said the minister-
Mr. BOTHWELL; May I ask a question, for information? Did I understand the hon. member to say, when reading the auditor general's instructions, that he told them not to take into account any depreciation, but that they should value at cost, or on some similar basis?


René-Antoine Pelletier: Yes. I will read it again.


Charles Edward Bothwell: And the values then fixed were fixed upon that basis?


René-Antoine Pelletier: Yes. The position is this: These values were fixed for the first time on December 31, 1936.


Charles Edward Bothwell: And that concerns part of the equipment which was built in 1907. Depreciation was not supposed to be com-sidered; is that so?
2842	COMMONS
Supply-Transport

St. Lawrence Dredging


Charles Avery Dunning: The hon. member has been quoting from a letter containing instructions from the auditor general. It is difficult to get clearly the contents of the letter because the hon. member interpolates his own observations. Would he facilitate proceedings in committee by reading the letter, without comment, so that it may appear on Hansard in that form?


René-Antoine Pelletier: I will table it.


Clarence Decatur Howe: Read it first.


René-Antoine Pelletier: Here is part of it-


Clarence Decatur Howe: Read it all.


René-Antoine Pelletier: All right.
The instructions from the auditor general with regard to the compilation of these inventories read as follows:
" This inventory should include stationery supplies, travelling accessories such as trunks, bags, cases, etc., and motor vehicles. The actual or approximate cost-"


Clarence Decatur Howe: "Cost."


René-Antoine Pelletier: "-of each individual item of stores and equipment on hand should be given, but where such information cannot readily be obtained then the estimated value should be indicated. In either case the inventory should be prepared to show the total value of such property on hand.
In regard to values, I wish to point out that as the principle of depreciation is not being observed under the policy of the government respecting the value of public property _ in general, it is not intended that depreciation should be considered. It is suggested therefore that property values once established, either on a cost or an estimated basis, should be maintained unchanged in your records from year to year until such property is finally disposed of, subject of course to any modifications required by additions or betterments."
This is the part of the letter which contained the instructions from the auditor general. If the minister wishes to have it-


Clarence Decatur Howe: Read it all, then table it.


René-Antoine Pelletier: I will do so.
The statement published by the auditor general indicates an increase of $9,436,608.85 in the value of stores and equipment of the Department of Transport at December 31st, 1936, as compared with December 31st, 1935. This leaves an opening for misinterpretation.


Charles Avery Dunning: Who says that?


René-Antoine Pelletier: It is signed by V. I. Smart, Deputy Minister of Transport.
No inventory of plant and equipment had been made and reported to the auditor general in respect of the St. Lawrence Ship channel, the Sorel shipyard, and the floating equipment

attached to the Quebec agency prior to 1936. The inventories at December 31st, 1936, in these respects were as follows:
St. Lawrence ship channel, $7,872,007.01.
And so on. So that that indicates-


Clarence Decatur Howe: Read it all; do not skip anything,-because the hon. member draws very strange conclusions.


René-Antoine Pelletier: All right.
St. Lawrence ship channel.. .. $ 7,872,007 01
Sorel shipyard	 310,225 23
Quebec agency	 2,776,141 41
Total	$10,958,373 65
so that the indicated increase in 1936 over 1935 was more than offset during that year because of the inclusion for the first time in the auditor general's statements of inventories of units that had not been previously reported although the units had been in existence for many years.


Charles Avery Dunning: Exactly.


René-Antoine Pelletier: It continues:
The detailed inventories represented on the statement herewith are on file in the records of the stores and equipment branch of the department in the Hunter building. They are voluminous and as we have only the one copy a tremendous amount of work would be involved in having copies made to forward to you. Perhaps you could arrange to see these inventories at our offices in the Hunter building in charge of Mr. C. H. Edgett, general purchasing agent.
Yours faithfully,
Y. I. Smart,
Deputy Minister.


Clarence Decatur Howe: But you did not go to see them, did you?


René-Antoine Pelletier: I did not need to. I had the totals, and that was sufficient.


Clarence Decatur Howe: You preferred to draw your own conclusions without going to get the facts.


René-Antoine Pelletier: I am not drawing my own conclusions. These are figures given to me by the department itself. I do not know what the minister means. Does he mean to say that I cannot accept the figures given to me by his own deputy minister? I cannot understand him.


Clarence Decatur Howe: I mean if my hon. friend wants to put interpretations upon them, he had better get the facts. These statements are so weird that I prefer to reserve comment until the hon. member finishes. Let him get through, but do not take it seriously.


René-Antoine Pelletier: The position I am establishing is that no inventory was made prior to 1936, and yet the minister accepts it. This comes from his own department, and what is the meaning of it?

Supply-Transport-St. Lawrence Dredging


Charles Avery Dunning: Well, what is the meaning of it?


Clarence Decatur Howe: You tell us.


René-Antoine Pelletier: I am wondering what the meaning of it is. I have an idea what it is.


Clarence Decatur Howe: Tell us what it is.


Charles Avery Dunning: What is the idea of it? What is your idea?


René-Antoine Pelletier: On top of the valuations of property around that vicinity, and on top of figures which I quoted as government purchases in that part of the vicinity, and on top of the auditor general's report-those are the three items by which I measured-the appraisal of the Canadian Appraisal Company was certainly not in accordance with the facts as given to me by the department.
Mr. ST-PERE: Who made the valuation for you?


René-Antoine Pelletier: The Canadian Appraisal Company.
Mr. ST-PERE: For you?


René-Antoine Pelletier: For me? The Minister of Transport. Let me add something more in connection with the auditor general. He
states:
I am dependent on the departments for the accuracy and completeness of the inventories transmitted to me but, as a result of continued correspondence and of my comments to the departments resulting from special examinations of their systems of control, etc., the inventories of stores and equipment are more complete year after year. To illustrate, the following comparisons are cited; they are taken from the inventories of the marine division.
Quebec	
Montreal (Sorel buoy
depot)	
Sorel ship channel.. .. Sorel (government shipyard)	
1935	1936
$382,868	$3,146,406
392,057	687,635
-	7,872,007
186,805	459,382
I am asking the minister to explain how it is that such a report can be tabled. If the information was not given to us previously, as it should have been, there is only one thing that can be said, and that is that this parliament is not being supplied with an accurate picture of a certain situation. The valuation of the Sorel shipyards is shown as $186,805 in 1935 and in 1936 as $459,382. In a period of one year, instead of having a depreciation, we find a great increase in valuation. Possibly I am not aware of the reason for this, but it must be known to others. Taking the figures supplied by the auditor general and those shown in the auditor
general's report, taking into consideration the method of valuation recommended by the auditor general we find we have this picture:
Quebec agency	$ 2,776,141 41
Montreal ship channel	
7,872,007	01Sorel shipyard	
459,382	56
Total valuation as at Decern- 

her 31, 1936	$11,107,530	98
It was at that time that an inventory was taken for the first time following instructions received from the auditor general.


Charles Avery Dunning: Without any depreciation on any of them.


René-Antoine Pelletier: That is not what the auditor general says in his letter. When were the values established? They were established on December 31, 1936, and not before. The shipyards were sold four months after.


Charles Edward Bothwell: I should like to know if the figure the hon. gentleman quotes represents the cost price of all this equipment.


René-Antoine Pelletier: If I were to give the total cost price my hon. friend would be at a loss.


Clarence Decatur Howe: Let us get this right. I tabled the cost price of everything at Sorel. The hon. member has received that return and he should read it item by item.


René-Antoine Pelletier: I did it once before.


Clarence Decatur Howe: Read it slowly. I want to have this on Hansard.


René-Antoine Pelletier: The minister supplied me with the information and I am not worrying about putting it on Hansard again. It is as follows:
Dredge No. 4, $94,564.


Clarence Decatur Howe: When was that built?


René-Antoine Pelletier: In 1900.


Charles Edward Bothwell: The hon. member should read all the figures so we may know where we are.


Clarence Decatur Howe: If the hon. member is reading a document, he should read it all.


The CHAIRMAN:: The point raised by the hon. member for Swift Current (Mr. Bothwell) is well taken. When an hon. member reads from a document he should read it all.


René-Antoine Pelletier: With pleasure. The figures are:
Dredge No. 4, built in 1900, cost $94,564.
Dredge No. 5, built in 1927, cost $388,952.
Dredge No. 8, built in 1907, changed to bucket dredge in 1928, cost $450,435.
Dredge No. 12, built in i912, cost $285,963.
Dredge No. 13, built in 1912, cost $267,832.
Dredge No. 14, built in 1914, cost $287,500.
2844	COMMONS
Supply-Transport-St. Lawrence Dredging
Dredge No. 15, built in 1914, cost 8287,500.
Dredge No. 16, built in 1923, cost 8837,200.
Dredge No. 17, built in 1931, cost 8444,535.
Dredge No. 18, still unfinished.
Dredge Churchill No. 1, built in 1928, cost $363,245.
Those are the costs of the dredges alone. I have only	a few	other items such	as
hopper barges. Hopper barge No. 5 cost $226,428. I have not the costs of all the items. I did not ask for it as I thought it would take too much time to supply. There were the following tugs:
Deschaillons; Becancour; Lake St. Pierre; Varennes; Contrecoeur; Iberville.
Then there	are	the	following:Coal barge	No.	6;	hopper barge	No.	1;hopper barge	No.	3;	hopper barge	No.	4;hopper barge	No.	5;	rock breaker	No.	1;steel sand dumping scow No. 22; steel dumping scow	No.	23;	steel	dumping	scow	No.	24;steel	dumping	scow	No.	25;	steel	dumpingscow	No.	26;	steel	dumping	scow	No.	27;steel	dumping	scow	No.	28;	steel	dumpingscow	No.	29;	steel	dumping	scow	No.	30;steel	dumping	scow	No.	31;	steel	dumpingscow No. 32; steel sand dumping scow No. 33; wood	dumping	scow	No.	34;	wood	dumpingscow	No.	35;	steel	dumping	scow	No.	36;steel	dumping	scow	No.	37;	steel	dumpingscow	No.	38;	steel	dumping	scow	No.	39;
steel dumping scow No. 40; steel dumping scow No. 41: winch scow No. 1; 11-barrel floats; 3 small wood flat scows; fire scow No. 1; fire scow No. 2.
It is not for me to say how much this cost the Canadian taxpayers, because I have not the information before me. I did get the cost of the dredges, which represented the most important part of the equipment on the St. Lawrence river. I have shown that two of the dredges could not be considered as old. The life of a dredge is not the same as the life of an automobile; it is much longer. I have shown definitely that two of these dredges alone cost the Canadian government more than what all the rest of the equipment put together was sold for. One	dredge	was	built in	1931	and theother in	1933.	The	minister	has	told usthat part	of the	time	the equipment	at Sorelshipyards was lying idle, so it cannot be said that these dredges were worn out. There may be some allowance for upkeep, but the minister has said that these dredges were idle and the work was given to private contractors.	These	are	some of	the	general
matters.
Since we are discussing dredging I think it might be well for me to go back into the past, because this subject has, I believe, never been brought before the house in this manner before. Governments change, and apparently

the thing was not considered to be of sufficient importance, but iwhen it concerns millions of dollars of the taxpayers' money I think it is deserving of our consideration. The particular case I am going to mention occurred in the past and the present minister may not be acquainted with the details, but I know he is in a position to obtain the information.
It is a principle that unless otherwise authorized to do so by order in council, the Department of Public Works cannot let any contract for work without calling for tenders. I find at page 240 of volume I of the auditor general's report for 1929 that a contract was awarded without tender to the Richelieu Engineering Company, contrary to clause 36 of the Public Works Act. An explanation was asked for by the auditor general, and this is the reply he received. The minister has been negotiating since 1927, and furthermore the minister stated that it was in the public interest that -this tug boat, or whatever it was, should be built.


Charles Avery Dunning: Mr. Chairman, my hon. friend persists in paraphrasing what he purports to quote from the auditor general's report. I submit, sir, that if a communication from the auditor general is quoted, it ought to be quoted and not paraphrased by anybody.


Frederick George Sanderson: The point of order taken by the Minister of Finance I think is well taken.


René-Antoine Pelletier: I would simply draw the minister's attention to this point, that I gave him the page and volume number of the auditor general's report-page 240, volume I, 1929. It is a public record, filed in this House of Commons. I have stated just where the quotation is. What more can I do?


Charles Avery Dunning: The hon. member can then proceed to quote it correctly.


René-Antoine Pelletier: I am doing it.


Charles Avery Dunning: If the hon. member quotes it, he must quote it.


René-Antoine Pelletier: All these matters are of public record, and the minister can read it for himself. But the conclusion I am drawing is this, that no tenders were called for, and the reason given was that it was adjudged to be a matter of public expediency. Yet we find that negotiations had been going on since 1927 -for the building of such a boat, and then finally it was said that the matter had become so urgent that it was necessary to build the boat without calling for tenders.
To go back again into the days gone by-this concerns the money of the taxpayers of this

Supply-Transport-St. Lawrence Dredging
country-let us look at some of the contracts which have been made in the past. The minister stated the other day that the principle of giving contracts was started in 1929. I do not believe that that is an accurate statement of the case, because contracts were given long before 1929.
Take contract No. 15423, which was awarded to Les Chantiers Manseau of Sorel, Quebec. This company later became the Marine Industries Limited, with yards at Sorel, and their equipment there. The date the contract was awarded was May 5, 1927. The work was done from April 19 to August 5 of that year. The amount removed was 347,524 cubic yards, class B, at 26 cents. What is noteworthy is that the work on this particular project began eighteen days before the contract was ever signed.
Then take contract No. 15493.


Charles Avery Dunning: Mr. Chairman, on a point of order, while I do not desire to interrupt my hon. friend, I think I am right in stating that he has now spoken considerably more than forty minutes. No one has desired to interrupt because it was thought he wished to complete his statement with respect to the particular matter he was criticizing, which was the disposal of certain equipment. Would it not facilitate the proceedings if he were to confine his remarks to that point? He will have the right to speak again, but if he wishes to proceed now at any length unanimous consent will be necessary. I have no objection to the hon. member proceeding, but I raise the point just that we may keep in order.


René-Antoine Pelletier: I have been interrupted by the minister. He has just sat down, and had quite a number of words to say.


Mr. McLEAN (Melfort):: You do not get another forty minutes now because of that.


René-Antoine Pelletier: I was interrupted two or three times, and I sat down.


Frederick George Sanderson: The rule as to the forty-minute limit is the same in committee as when the Speaker is in the chair, and unless an hon. member has the unanimous consent of the house he must take his seat when his forty minutes have expired.


René-Antoine Pelletier: I think, Mr. Chairman, you ought to take into consideration the fact that the Minister of Transport interrupted and made a statement during my forty minutes.


Frederick George Sanderson: The hon. member's time has expired, and I must ask him to resume his seat.


Mr. STEWART:: Does not the interruption of the Minister of Finance-


Charles Avery Dunning: Interruptions do not affect the rule.


Hugh Alexander Stewart: On several occasions it was more than a mere interruption, and two or three have spoken during the hon. member's time. I submit that according to a strict interpretation of the rule the member who is speaking has had a chance to come to his feet again, and he is on his feet again after a speech by the Minister of Finance, and therefore is due for forty minutes more.


Charles Avery Dunning: On that point of order, Mr. Chairman, whether an interruption entitles the member who has the floor to another forty minutes from the time of the interruption, I would submit as one who has suffered from interruptions quite a good deal and never been allowed for them in that manner-although I have had to acknowledge the courtesy and consideration of the house in granting me more than my original forty minutes-that we would be establishing a new rule if we said that interruptions such as have just taken place entitle a speaker to an additional forty minutes. I have no objection as a member to allowing my hon. friend to finish his speech. I merely rose to call attention to the fact that he had already exceeded by more than five minutes his forty minutes, and I think five minutes would probably be sufficient to allow for the interruptions. But we should be establishing, I believe, a new rule, Mr. Chairman, if we said that interruptions, or points of order raised, automatically give the member who has the floor an additional forty minutes from the time of the interruption.


Hugh Alexander Stewart: I admit that, but I would consider the minister's statement a little more than an interruption.


Clarence Decatur Howe: On the point of order, Mr. Chairman, if the hon. member wishes the indulgence of the committee, I am entirely in favour of giving him more time if he is going to speak to the item. At the moment we are discussing an item of the Department of Transport, which previously was the Department of Marine, with reference to St. Lawrence dredging and the Sorel shipyard. When my hon. friend was interrupted last he was talking about dredging under the Public Works department, which has nothing to do with this item at all.


Mr. JOHNSTON (Bow River):: That is drawing it too fine, because since I have been here nearly every member has violated almost every rule of the house.
2846	COMMONS
Supply-Transport-St. Lawrence Dredging


Clarence Decatur Howe: If there are rules, we should respect them, and there is a rule confining a member to forty minutes. But if the hon. member wishes to discuss this particular item,
I shall be delighted to ask for unanimous consent to permit him to continue for a reasonable time.


Mr. COLDWELL:: There are occasions upon which the enforcement of rules is dangerous to all concerned, and I think in this particular instance, because of the interpretation that might be placed upon any curtailment of the discussion at the present time, we would be well advised and it would be in the interests of the house generally to let the hon. member proceed. I know nothing of the matter under discussion. I am listening with an entirely. open mind and hearing it for the first time, and I think in the interests of all concerned it would be well to allow, the hon. member to continue.


Clarence Decatur Howe: Just to relieve the committee I may say that when the hon. member gets through with the question he is discussing I shall be able to reply to him, item by item, with documentary evidence. So if any hon. member feels that anyone may be left besmirched by cutting the hon. member off, he can dismiss that from his mind at once. Let the hon. member proceed.


Major James William Coldwell: That was the point I had in mind. I think it would be well to let him go on.


Charles Avery Dunning: If the hon. member has the indulgence of the committee to speak for more than forty minutes, should he not at least respect the other rule and confine himself to the item before the committee? He should not, if he is given the indulgence of the committee on a particular point, undertake a roving commission over everything; because obviously the minister cannot answer with respect to matters extraneous to his department.


Frederick George Sanderson: In order to clarify the whole situation, I would point out to the hon. member that while, with the consent of the committee, he may continue, he must confine his remarks to the item under discussion.


René-Antoine Pelletier: The item under discussion represents almost $3,000,000, Which sum will be paid to a private company to dredge the St. Lawrence, and the dredging becomes necessary because equipment owned by the government has been disposed of. This was formerly under the Public Works department, and has now been taken over by the Department of Transport.


Clarence Decatur Howe: It was never under the Department of Public Works; it was under the Department of Marine.


René-Antoine Pelletier: The minister is drawing fine distinctions. At any rate it was under a different minister. It is necessary when we review the situation to go back some time in the past. What I am emphasizing is this. I regret that the impression should prevail among the public that because a utility is publicly owned it is necessarily badly administered. Private enterprise on all sides points to examples of public administration which it is said have not been successful, and that is used as an argument against public ownership of various utilities. If in our public administration there are departments that are not administered as efficiently as they should be, that makes it possible for private interests to argue against public ownership. They say, " When that happens under government administration, what is to be expected "?
The point I wish to bring out is that work on various contracts was begun days, and in some instances weeks, before the contract was signed. Does that mean that any individual company can plant its equipment in the St. Lawrence and start dredging and then come to the government and get a contract? I do not understand how it is that any contractor can begin work before his contract is signed. Possibly there is a logical explanation, and, as the minister has said, he will be in a position shortly to explain to the committee how things of this sort come about.
We have been talking about values, and in my opinion that is relevant to the item before the committee. The minister made it clear to me that he wanted a complete statement with regard to values and therefore he must be interested in the subject from that point of view. Why not tell the story of the famous dredge Marine and Fisheries No. 10, which is now known as Manseau 101, or of Marine and Fisheries No. 11, which is now known as Manseau 103? Both were built a long time ago. They were owned by the government and then sold after a certain period.


Charles Avery Dunning: How long ago?


René-Antoine Pelletier: I do not know exactly. At any rate they were disposed of to a private individual in Montreal. They became the property of Manseau Shipyards Limited, and to-day one of these dredges is doing contract work.
On the order paper there appears a question of mine with regard to painting and repairs to

Supply-Transport-St. Lawrence Dredging
the buildings at the Sorel shipyards. The question is No. 7 on to-day's order paper and part 2 reads:
How much money was spent for painting and repair to the buildings at the Sorel shipyards for the five months preceding July 22nd, 1937?
That was the date on which the Sorel shipyards were sold. I have not received the answer. The question was first asked on May 4, and it is now May 13. Possibly the minister has not yet had time to secure the information.


Clarence Decatur Howe: The information has just
come to hand and I shall be glad to give the answers orally. The first question is:
Did the government sell coal barge No. 6 to the General Dredging Company last year?
The answer is, yes.
If so, (a) has the government used or rented coal barge No. 6 from the General Dredging Company since it was sold to them?
The answer is, yes.
(b)	how much rent has the government paid each day?
The answer is that the contract was for S265 per day for a period not exceeding ten days.
(c)	for what purpose was it used?
For the purpose of assisting in the spring rush of laying buoys at the Montreal agency.
2.	How much money was spent for painting and repair to the buildings at the Sorel shipyards for the five months preceding July 22, 1937?
The answer is $2,058.96.


René-Antoine Pelletier: I am glad to get the
information. I realize that the minister did not have very much time in which to get it. If I understand rightly, the barge was rented for a period of ten days at $265 per day. Is that correct?


Clarence Decatur Howe: Yes.


René-Antoine Pelletier: When the shoe is on
the other foot what happens? When the government rented to a private contractor certain equipment at least comparable to this they rented it at $100 a month. Rock crusher No 1 was taken from the Sorel shipyards in 1931 and has been rented at $100 a month. It is now the property of the company who rented it, they having bought it for $15,000. But when the government want to rent equipment from a private concern they have to pay $265 a day. If they paid only half or only a quarter of that sum, compare the rent paid by the government with the rent paid by a private concern to
the government. As I say, the government for a whole month received $100 for a rock crusher which is now in the yards at Sorel.


Charles Avery Dunning: Would the hon. gentleman expect to rent an automobile at the same rate as a bicycle?


René-Antoine Pelletier: If the Minister of
Finance would visit the shipyards at Sorel he would see the sort of work the rock breaker does. It is used for breaking rock at the bottom of the channel, and is considerably larger than any automobile. An automobile would cost to rent $50 a month. He knows that this sort of discrimination cannot be defended.
The figures I have used to-day in connection with this item were supplied by various government departments. I realize my limitations. I know my capacities, and it is not possible for me to delve into this matter as deeply as someone with better qualifications might. I do not think it is an easy task for one person without proper information to get at all the facts. I rely upon the Minister of Transport and I know that he will be able to explain to us why no inventory was taken before December 31, 1936. I hope he will explain that and other matters that I have brought to his attention. I could have read more of the contracts and shown the discrepancy between the date the contract was awarded and1 the date the work began, but I leave that off the record. My purpose is this: I believe that certain functions performed by a government should be performed as efficiently as they could be performed Iby any private enterprise. I believe if this kind of government administration is permitted-loose accounting, for example, or careless accounting-it gives ground for private industry to say: "See what happens when a thing is owned by the government. This is what you get under public ownership when governments are administering anything." I believe that if the facts are told it would be possible for any department of the government to administer any business in this country properly, and do it as efficiently as private enterprise ever can. I pause, because I believe that my time has expired once more: I shall probably resume later.


Mr. BAKER:: It is difficult to grasp the idea that the hon. member is trying to convey, but in. summary is it this: that the government has been selling machinery to private companies at ten to twenty cents on the dollar, and then giving them large contracts in which they use this very machinery and
2848	COMMONS
Supply-Transport-St. Lawrence Dredging
get large sums of money out of the government? If that is so, of course there is something for the government to answer.


René-Antoine Pelletier: I s.m not a lawyer, but if I were I would say that that is a very leading question. I do not know what interpretation the government can place upon it; I have simply attempted to put on record the facts.


Richard Langton Baker: I am not defending the government; I say if that is the purpose of it they should answer.


René-Antoine Pelletier: I agree that possibly the government will answer, and I should like the hon. member to join with me in insisting that it should be done. The minister no doubt has a few remarks to make, and perhaps he would care to make them now.


Clarence Decatur Howe: I have listened for the last hour and a half or thereabouts to some very serious accusations. If any part of them were true, I would have no option but to resign from the government and place my seat at the disposal of my electors. Fortunately none of them are true in any particular, therefore I shall stay here.
Now I should be feeling very serious resentment, for as I stated clearly in the committee, I personally attended to every detail of the negotiations for the sale of this equipment. Therefore the accusation is against my personal honesty, and I should feel very bitter against the hon. member. But as a matter of fact I cannot bring myself to feel so at all.


An hon. MEMBER:: You should sympathize with him.


Clarence Decatur Howe: I realize that the hon. member is very young and very gullible. Months ago we heard rumours that a great scandal was to break in the house about the sale of this Sorel shipyard, something that would shake the government. Then an obscure journal published in Quebec began to say that it was expected that the hon. member for Peace River (Mr. Pelletier) would make the presentation. We then had the hon. member visiting Sorel. He was taken to the assessor's office, not of the village of St. Joseph de Sorel but of the town of Sorel. He was furnished with a list of assessments in the town of Sorel, which he solemnly read to us here a while ago, I presume to lead the committee to the conclusion that these were assessments of shipyard property.


An hon. MEMBER:: Who took him to
Sorel?


Clarence Decatur Howe: We all know who took him
to Sorel.


René-Antoine Pelletier: Tell us.


Clarence Decatur Howe: I simply want to explain
why I feel no great bitterness in the matter. The men who had been advertising this situation in advance needed not only someone young and very gullible, but someone completely addled as to financial affairs, because without that it would have been impossible to show to any hon. member the documents he was shown, and expect that hon. member to accept them seriously. This is all the more the situation since my own department has answered clearly and fully every question that he asked, and the hon. member has in his possession absolutely correct statements of everything that he has given in a garbled and distorted manner to this committee.
Let us start at the beginning. Let us take his statement about assessments of property at Sorel. He tried, I think, in his speech a week ago to lead the committee to the conclusion that the land comprising the Sorel shipyard was worth a million dollars, and was carried on assessment rolls of the town of Sorel at that price. Of course at that time he did not explain to the committee, as he has admitted to-day, that the shipyard is not in the town of Sorel but in the parish of St. Joseph de Sorel.


René-Antoine Pelletier: It was eleven o'clock,
and the chairman stopped me.


Clarence Decatur Howe: Well, eleven o'clock came
very conveniently. This is the list of properties he read, in the town of Sorel, totalling $1,046,000 on the assessment roll:
Elevator and Weaver coal wharf..$
Coumoyer's old store	
Morgan wharf	
Beaudet wharf	
Leveille wharf	
Alfred Lavallee's property	
McCarthy wharf	
Lanctot basin	
New wharf, Department of Public
Works	
Buoys wharf	
Office of Transport department.. .. Lot at end of Ramesay street.. ..
650.000 2,000 7,500 9,000 5,400
15.000 16,800
100.000
200,000
15.000
25.000 300

I think my hon. friend will now admit that not one square inch of the property in the list I have just read and of which he quoted the assessments has anything to do with the Sorel shipyard in any way, shape or form.


René-Antoine Pelletier: How does the minister arrive at the value of the industrial property we are talking about?

Supply-Transport-St. Lawrence Dredging


Clarence Decatur Howe: I simply took it off the assessment roll of the town of Sorel, the figures you went there to get.


René-Antoine Pelletier: The minister did not
mention the industrial property in question.


Clarence Decatur Howe: I am coming to that. When
my hon. friend was visiting assessment offices he could just as well have gone to the municipality of St. Joseph de Sorel and got the assessed values of the property he was talking about. I do not know whether he went there or not, but I am assuming he did not, because I cannot conceive of his going and getting the information without presenting it to the committee. I have here a statement signed by the city clerk of St. Joseph de Sorel, and stamped with the seal of the village. The document is in French but I shall read what I believe to be an accurate English translation:
I, the undersigned, Gerard Cournoyer, secretary-treasurer of the village of St. Joseph, do declare under my oath of office:
1.	That the federal government appears on the roll as the owner of pieces of land covering an area of 3,940,000 square feet which pieces of land are appraised at the sum of $500,000.
2.	That no separate municipal appraisal is recorded in the books of the corporation for that part of the lands which was formerly occupied by the government shipyard;
3.	That since the sale of the government shipyard an appraisal has been made of the lands and buildings sold in the sum of $150,000. This valuation has been made by the three appraisers of our municipality, appointed by the municipal council and sworn in by the secretary-treasurer.
4.	That the pieces of land sold to the General Dredging Contractors, Limited, represent an area of about 800,000 square feet, or one-fourth of the total area of the lands.
(Signed) G. Cournoyer,
Secretary-Treasurer.
April 27, 1938.
Now what do we conclude from that? The government owns in St. Joseph de Sorel 3,940,000 square feet of land, which is of course the old ordnance property and the shipyard. The shipyard represents 800,000 square feet, or a little more than one-fifth of the whole. If my hon. friend had gone to the proper town for his tax appraisal he would have found that the appraised value on the books of the town is a little over $100,000, we will say at the outside $125,000, for the shipyard property and the land that was sold. It now stands in the books of the town with an assessment of $150,000 against the new owners. So much for the appraisal of the land.
Now let us come to the auditor general's inventory, which is simply a statement carried in the books of the government showing what
various properties cost. There may be some obligation on departments to keep those inventories more or less up to date, and I may say that the rules of the auditor general provide that items shall be entered in the inventory at cost. They are carried at cost until the items are actually disposed of by the government, and of course, some items are never disposed of, so as a result the "inventory" is a more or less meaningless affair. However, the auditor general did call to my attention the fact that our inventory was not up to date, and I issued instructions that it be brought up to date. I have in my hand a copy of the document furnished the auditor general by our department, giving the items in detail. This was furnished in response to his request and is the document from which the figures quoted by my hon. friend were taken. In this list there are two columns, the first showing the original cost of the article and the second the market value, as it is described here, as in 1936. The figures given to my hon. friend were the cost figures.


Major James William Coldwell: What was the date of that document?


Clarence Decatur Howe: February, 1937. It is the inventory of the fleet at the end of 1936, the first inventory of that equipment we ever supplied to the auditor general. This inventory adds up to $7,872,007.01, which is the figure my hon. friend gave.


René-Antoine Pelletier: The minister stated
there was no inventory supplied before. Will he please explain why?


Clarence Decatur Howe: I cannot say that; all I know is that the first request came to me, as mim< ister, in 1936, and I complied with it. 1 thought if the auditor general wanted the inventory he had better have it, and I issued instructions to have it made up and given to him. That was the first request I ever received, and I complied with it as soon as the inventory could be made up.
The figure given by my hon. friend as being the original cost of this equipment was $7,872,007.01. I have the present day value, which was furnished to the auditor general at the same time, and that figure is $1,953,900. However, on this list there are many items that were not sold. For instance, we have the steamship Bellechasse, the steamship Berthier, the steamship Detector, the steamship Frontenac, the tug Lanoraie, the tug Laviolette, and the tug Lavaltrie, which the government still own. Then we have coal barge No. 5, stone lifter No. 4, stone lifter No. 5, sounding scows Nos. 1, 2 and 3; winch
2850	COMMONS
Supply-Transport-St. Lawrence Dredging
scow No. 2; a coal scow; steel catamaran No. 1; wood catamaran No. 2; D. M. motor boats Nos. 1, 2, 3, 4, 5, 6 and 7. The total cost of the material not sold was $1,327,948.35, giving the net cost of the material sold-and remember this is the cost-of 86,544,058.66. The material not sold, according to the inventory furnished the auditor general, had a market value as of that date of $455,800, leaving the market value of the material sold $1,498,100.
This is the document on which my hon. friend attempted to base his argument that this equipment was ridiculously overvalued. It is the very document he asked for. I am sure if he had asked the auditor general for the present day values, instead of the values as carried on the books of the government, the auditor general would have been glad to give them. If he still wants them, I am sure the auditor general will furnish them, because they appear on the same sheet with the other figures to which my hon. friend referred. According to this statement, which was furnished the auditor general-and because of which my hon. friend asks us to believe that there has 'been a great scandal-the present day value of the equipment sold is given as $1,498,100 and the sale price of the equipment was $1,494,594, or practically the inventory figure made by the department in February, 1937.


René-Antoine Pelletier: The minister is telling us now of the equipment he still has on hand.
I did not mention anything about the equip- ' ment that remained unsold. The figures I quoted covered the list supplied to me by the department, and had nothing to do with the equipment remaining unsold. I do not know anything about that.


Clarence Decatur Howe: My hon. friend quoted the list furnished him by the department, I take it?


René-Antoine Pelletier: That is right.


Clarence Decatur Howe: The figure mentioned by my hon. friend was taken from the auditor general's report, and I have just read from our report to the auditor general. The figure of $7,872,007.01 mentioned by my hon. friend is the figure I have been breaking down for him.


René-Antoine Pelletier: I referred to the auditor general's report as of December 31, 1936.
I do not know what reports have been made since that time. I have not that information, but that is not material. I am not concerned with what happened after that date ;
I am talking about the report as it appears in the auditor general's report.


Clarence Decatur Howe: That is exactly what I am giving. This is the statement from which he made up his figures.


René-Antoine Pelletier: Since that time.


Clarence Decatur Howe: No.


René-Antoine Pelletier: Since December 31, 1936. [DOT]


Clarence Decatur Howe: No, it is the only report we ever filed.


René-Antoine Pelletier: But it does not change the total of over $7,000,000 for the St. Lawrence ship channel.


Clarence Decatur Howe: I have shown how all that figures out. I think I stated that it was because my hon. friend is absolutely addled as a financier that he has been chosen for this work. I cannot state the position more clearly than I have.


René-Antoine Pelletier: Why does the minister say I was chosen for this work? He has no right to say that. Mr. Chairman, I am speaking to a point of order. I do not see why anything like that should be said.


Clarence Decatur Howe: I will put it this way-the person who chose you to take on the work.


René-Antoine Pelletier: That is not a withdrawal, and I think the minister should take it back.
I was not chosen. I am doing it of my own accord because it is in the interests of the Canadian taxpayer and the truth.


Clarence Decatur Howe: It must have brought you in rontact with very strange friends, then.


René-Antoine Pelletier: On a point of order,
I think the minister should take that back. He should not say that I was chosen.


Mr. BRADETTE:: What about the insinuations you make?


An hon. MEMBER:: It is a false accusation.


Clarence Decatur Howe: What is a false accusation?


Charles Edward Johnston: That anybody hired him to do the work.


Clarence Decatur Howe: I did not say anybody hired him.


Charles Edward Johnston: That was the inference.


Clarence Decatur Howe: No, I deny that. No insinuation of the kind was made, and I think no hon. member could reasonably take that from what I said. I did not say he was hired for the work.


Frederick George Sanderson: On the point of order raised by the hon. member for Peace River (Mr. Pelletier), I take it the point is that the remark of the Minister of Transport was that he was chosen-

Supply-Transport-St. Lawrence Dredging


Mr. MACKENZIE (Vancouver):: Chosen by Providence.


Frederick George Sanderson: In my opinion that expression is not out of order.


René-Antoine Pelletier: Mr. Chairman, I have absolutely nothing to say. I leave it to the committee to judge whether or not your interpretation of that kind of language is correct.


Frederick George Sanderson: Order. The hon. member for Peace River has made a reflection upon the Chair which he must withdraw.


René-Antoine Pelletier: If I made any reflection upon the Chair, Mr. Chairman, while I cannot see it, I will withdraw it.


Mr. HANSELL:: When the Minister of Transport used the word " chosen " the thought that came to my mind was that it might be interpreted that the hon. member had been chosen -by this group.


Frederick George Sanderson: Would the hon. member speak louder, please?


Ernest George Hansell: When the minister used the term "chosen" the thought came to me that he might have meant the hon. member was chosen by this group, and that is not so. The hon. member has himself stated that he did this entirely of his own accord. That is his privilege. So far as some other hon. members and myself are concerned may I say that we do not know anything more about it than does the hon. member for Rosetown-Biggar (Mr. Coldwell).


Mr. LANDERYOU:: The minister has no
right to reflect upon the "friends" of the hon. member.


Clarence Decatur Howe: I make it quite clear that
I did not intend to insinuate that any one in the Social Credit party or group chose the hon. member for the work, nor do I wish to intimate that any one paid the hon. member for the work. If any such inference was taken by anyone from my remark I wish to state that no remark of mine is to be taken in that way.


John Charles Landeryou: Who are the friends
to whom the minister referred?


René-Antoine Pelletier: The minister has just
said he does not believe the hon. member was chosen by the group, or that he was paid by somebody else. That does not take away from the fact that he has not changed the word "chosen."


Charles Avery Dunning: Surely it is not wrong
to use the word "chosen." For instance, he might have been chosen by Providence;
divine inspiration might have descended upon the hon. member. In view of the hon. member's speech I am surprised he should be so very thin-skinned, because if there is any merit in the hon. member's speech then the Minister of Transport, as he has said himself, ought not to remain in public life. If a man takes the responsibility of making charges of that sort with respect to a minister and a department surely he cannot take exception to the statement that he was chosen to do the work.


Charles Edward Johnston: Chosen by whom?-that is the point. By whom was he chosen?


Frederick George Sanderson: The discussion is quite out of order. The point of order was raised by the hon. member for Peace River, and I gave my ruling, which was that in my opinion the point of order was not well taken. Proceed with the discussion.


Mr. THORSON:: Perhaps the hon. member could clear it up by telling the committee who took him to Sorel.


Charles Edward Johnston: That is
the point, Mr. Chairman; the inference is thrown right back.


Clarence Decatur Howe: Who did take him?


Frederick George Sanderson: Order.
Mr, JOHNSTON (Bow River): That must be proven.


Frederick George Sanderson: The point of order is
settled; proceed with the discussion.


Mr. MARTIN:: Was or was not the hon. member for Peace River taken?


Charles Edward Johnston: You said he was.


Frederick George Sanderson: Order.


Mr. DOUGLAS (Weyburn):: Perhaps to
Beauharnois.


Clarence Decatur Howe: I do not wish to labour the point, but may I point out that the principal charges against me were based upon two documents. I believe I have shown the facts so far as the assessment at Sorel goes. The document used was one taken from the records of a town in which no property which was involved in the sale of this shipyard is located. I have given the details which made up the figures which were given. I have also given the figures for the town where the shipyard is located. I have referred to tax records there and I have shown that from the records of the town where the shipyard is located-and I think those
2852	COMMONS
Supply-Transport-St. Lawrence Dredging
are the proper records-the assessment of the property before the sale and to-day is just about what we would expect from the figures and details which I have laid before the house with respect to the sale of equipment.
Then, reference has been made to the auditor general's report. The hon. member was invited to come to the Department of Transport and to see all the details which went to make up that report. He did not go; he preferred to go to Sorel. He would not go across to the Hunter building to see what we had on the subject. Had he gone there he would have seen every detail which went to make up the report and he would have seen the report just as it went to the auditor general. I am sure if he had called at the auditor general's office that official would have been glad to show him the report, just as I have it here to-day.


René-Antoine Pelletier: Would my visit have changed the total figures? Had I visited the Hunter building would there have been any change in what the auditor general has on the files?


Clarence Decatur Howe: What does he say the total is?


René-Antoine Pelletier: He says the total was $10,958,373.65.


Clarence Decatur Howe: The total of what?


René-Antoine Pelletier: The total of the St. Lawrence ship channel, the Sorel shipyard and the Quebec agency.


Clarence Decatur Howe: Where is the Quebec agency located? May I say to the hon. member that it is located in the city of Quebec. What are the other items?


René-Antoine Pelletier: There is one for the St. Lawrence ship channel amounting to $7,872,-
007.01.


Clarence Decatur Howe: That is the figure I have been reading, and the one we have been discussing. The St. Lawrence ship channel fleet was tied up at Sorel.


René-Antoine Pelletier: If I had gone to the Hunter building would those figures have been changed?


Clarence Decatur Howe: No, but you would have found out that it was cost and not value. Had the hon. member gone to the auditor general he would have found out about the figures.


René-Antoine Pelletier: The auditor general's instructions are here, and if I must go over them again, I will do so. In regard to values he definitely states how values will be established. His words are these:
It is suggested therefore that property values once established-

And those are the important words-"once established." They were established in 1936.


Clarence Decatur Howe: The hon. member never reads the pertinent part of a letter. If he would read it from the start he would be more fair. I do not think the hon. member understands it, otherwise I would not be so patient. If he will read it again I will explain it.


René-Antoine Pelletier: Perhaps many of us do not.
This inventory should include stationery supplies, travelling accessories such as trunks, bags, cases, etc., and motor vehicles. The actual or approximate cost of each individual item-


Clarence Decatur Howe: Stop right there. He says, " actual or approximate cost." He states that if the cost cannot be determined, then the estimated value should be indicated. Could anything be clearer than that?


René-Antoine Pelletier: That is quite clear. I quote:
The actual or approximate cost of each individual item of stores and equipment on hand should be given, but where such information cannot readily be obtained then the estimated value should be indicated. In either case the inventory should be prepared to show the total value of such property on hand.
Those are important words.


Clarence Decatur Howe: We gave both the cost and the value in parallel columns. I Shall be glad to file that information, or the hon. member can get it from the auditor general. He chose to take the cost, which was an indication to me that the cost was what he wanted when I had put both figures before him.


René-Antoine Pelletier: The auditor general could have used figures other than those he did use?


Clarence Decatur Howe: We furnished the cost and the value.


René-Antoine Pelletier: He then goes on to state how the values are to be ascertained:
It is suggested therefore that property values once established, either on a cost or an estimated basis, should be maintained-
When were those values established? They were established in 1936.


Clarence Decatur Howe: But cost is still cost.


René-Antoine Pelletier: " Either on a cost or an estimated basis."


Clarence Decatur Howe: We gave him the cost figures because in every case we were able to establish the cost.


René-Antoine Pelletier: Nevertheless, it comes down to this: we must take the value as at December 31, 1936, because that is the first
2S53

Supply-Transport-Miscellaneous
time any valuation was made. That is the point that I consider material in this matter. It has not been shown why an inventory was not taken before. We do not know what happened before and we cannot make any comparison with the past.


[Stage Direction]
Item agreed to.
River St. Lawrence ship canal-operation and maintenance, including any portion of contract dredging chargeable to maintenance, $321,600.
Hugh Alexander Stewart: Is the considerable decrease in this item due to the sale of part of the fleet?


Clarence Decatur Howe: This item of maintenance dredging was set up last year for the first time. The channel was nearing completion and we thought we should separate the capital vote from the maintenance vote. We voted 3438,400 last year, but we found that the actual maintenance dredging cost less than that and we reduced the item accordingly. It is thought that the cost of the maintenance of the channel will stay constant at about this figure.


Hugh Alexander Stewart: How much was spent last year under the vote?


Clarence Decatur Howe: I do not appear to have the details of how the money was spent.


Hugh Alexander Stewart: If the minister has the estimated figures for this year it will give us a guide.


Clarence Decatur Howe: The amount for permanent staff is $49,270, of which $25,620 is charged to capital dredging. This would leave permanent staff expenditures of $23,650. Then there is:
Temporary assistance, $73,873.86.
Contract dredging, $150,000.
Fuel, staff boats, $21,919.69.
Materials and supplies, staff boats, $8,574.48.
Repairs, plant and equipment, $29,818.03.
Sundries, $13,763.94.


Hugh Alexander Stewart: I notice it is proposed to do some contract dredging. Will that be for deepening the channel or just to maintain what has been dredged to the required depth?


Clarence Decatur Howe: It is purely maintenance.
There is silting at two points below Quebec and one point below Three Rivers and this must be attended to practically every year.


Hugh Alexander Stewart: It is proposed to have some of that work done by contract.


Clarence Decatur Howe: We have no dredging equipment of our own.


Mr. REID:: How much money has been spent on dredging in the St. Lawrence during the pa9t five years?


Clarence Decatur Howe: The total expenditure for the period from the fiscal year 1931-32 to the end of the fiscal year 1936-37 was $30,300,000.


[Stage Direction]
Item agreed to.
To provide for the removal of derelicts in Canadian waters, $15,000.
Mr. STIRLING:: Would the minister give the committee some information with regard to this? I see it is a new item.


Clarence Decatur Howe: It is new in the main estimates, but an item that has been continued for I think now three years in the special supplementaries. The harbours of Canada were littered with derelicts, and there seemed to be no one responsible for their removal. The derelicts that caused the trouble were those for which no owner could be found and no department would assume responsibility. It is the policy of the Department of Marine to remove these derelicts and to give strict instructions that no more shall be allowed to accumulate in the organized harbours of Canada. I think some $70,000 has been spent on this work altogether, and this item is intended, I believe, to complete the work.


Grote Stirling: How, actually, is the
work done?


Clarence Decatur Howe: By contract. Each one is treated separately. In some cases it may be a matter of only seventy-five or a hundred dollars, but there have been derelicts that cost from eleven to twelve thousand dollars to remove.


Mr. TAYLOR (Nanaimo):: It applies only to the organized harbours?


Clarence Decatur Howe: Yes, and by organized harbour I mean a harbour with a harbour master.


[Stage Direction]
Item agreed to.
To provide towards the construction of a combination icebreaker and service vessel, estimated to cost $600,000-amount required for 1938-39-capital, $200,000.
Mr. PERLEY:: Is any part of this spent
on the great lakes, around Port Arthur?


Clarence Decatur Howe: This item is for a new service steamer. The fleet, as hon. members who live by the sea are aware, contains some very old vessels. The new boat is to be a combination boat which we hope will mean the scrapping of three of the oldest vessels, the Aran-more, going on now to forty-nine years old, the Bellechasse, and the Lady Grey, both of which are very old and exceedingly expensive to operate. We expect to build a boat which will be able to release these other boats by

2854	COMMONS
Supply-Transport-Railway Commission
doing double and triple duty on the St. Lawrence, enabling us to retire these older boats which are very expensive both in operation and in repairs. This 8200,000 is part of an expenditure that is estimated to run around $500,000, the S200,000 being required this year.


Grote Stirling: How does the new boat
compare with the McLean?


Clarence Decatur Howe: This will be of a lighter draft than the McLean. It is being built primarily for icebreaking service in the St. Lawrence. None of the present boats can work back outside the limits of the channel, because of their deep draft; our boats have as deep a draft as the ocean liners, and therefore they must confine their work to the channel. But this lighter draft ice-breaker will be able to work outside the channel. It will also take the place of the Bellechasse, which is the principal staff boat for the St. Lawrence dredging. and it will have buoy-lifting equipment, so that it will be able to help out with the buoys in the spring and fall.


Hugh Alexander Stewart: Has the contract been
let for this boat?


Clarence Decatur Howe: No, plans have been prepared, but we cannot very well award the contract until the money is voted.


Mr. BROOKS:: Is it the expectation that
this icebreaker will open the St. Lawrence channel earlier than it has been opened in the past?


Clarence Decatur Howe: No, but we have never failed to get the channel open in time for navigation, that time depending on conditions in the strait of Belle Isle. The channel will not be open any earlier, but we think it will be opened a little more efficiently and a little less expensively.


Alfred Johnson Brooks: So the ports of St. John
and Halifax will not suffer by the use of this new equipment?


Clarence Decatur Howe: No, they will be in a neutral position so far as this item is concerned.


[Stage Direction]
Item agreed to.
Railway service-
Salaries of Board of Railway Commissioners, $53,500.
Railway grade crossing fund, 19-20 Geo. V, chapter 54, $200,000.
Railway grade crossing fund-amount (in addition to that provided by section 262, subsection (6) of the Railway Act) to be placed to the credit of the railway grade crossing fund, and to be applied by the Board of Railway Commissioners for Canada pursuant to, and

within the limitations of, the provisions of section 262 of the Railway Act, as enacted by chapter 43 of the statutes of Canada, 1928, and amended by chapter 54 of the statutes of Canada, 1929, $300,000.
Hugh Alexander Stewart: Would the minister give the committee a statement on the present condition of the fund? He will recall that in years gone by there was an accumulation of arrears, as it were; that is, a number of orders had been made but the funds were not available to satisfy the amount which the dominion was required to contribute under the orders. I do not know whether those arrears have been overtaken or just how we stand with respect to our liabilities to the fund.


Clarence Decatur Howe: A revote is required this year for moneys for which we are committed and for work partly done. That revote is not in the main estimates but will be amongst the railway items in the supplementaries. We were not able to determine the amount until the end of the fiscal year, and so the amount was not ready for the main estimates.


Hugh Alexander Stewart: Do I understand the minister to say that the liabilities that will be provided for by the main estimates will be approximately $2,000,000.


Clarence Decatur Howe: That will be in the supplementaries.


Hugh Alexander Stewart: And this is to take care of what the minister anticipates will be required during the coming fiscal year outside of arrears?


Clarence Decatur Howe: The position is that there is a statutory vote of $200,000 for the grade crossing fund, and this amount of $300,000 is to supplement the statutory vote. Of course, my hon. friend is aware that under the Public Works Construction Act a fund was placed at the disposal of the railway board apart from the statutory vote. It ran to about a million dollars a year. Whether that will be placed at their disposal again will appear later.	[DOT]


Hugh Alexander Stewart: Is this amount to take care of anticipated obligations during the coming year outside of any special provision?


Clarence Decatur Howe: Yes.


Alfred Johnson Brooks: This is a very important item in view of the number of accidents that are occurring at railway crossings, and I would ask the minister what plan the department has for the elimination of railway grade crossings. Is it the intention gradually to eliminate them, and how is the selection made of those which are to be removed at different times?

Supply-Transport-Railway Commission


Clarence Decatur Howe: The selection is made entirely by the board of railway commissioners, who administer this fund. The department has nothing to do with the selection. The board hears applications for the abolition of grade crossings in the order, I suppose, in which they are filed, determines the merits of the application, whether there should be a division of the cost, and if so, what it should be, and then issues its order. The order carries with it, of course, sufficient funds to carry out the government's contribution as assessed by the board. All we do is to vote the money, turn it over to the board of railway commissioners to administer, and approve the orders sent forward.


Alfred Johnson Brooks: Will the most dangerous crossings be eliminated first? Is there a plan working to that end?


Clarence Decatur Howe: The board does not initiate
grade crossing projects, but simply passes upon applications made. As a matter of fact there is no great rush of applications to the board, strange as that may seem. Two years ago they were worried because they did not know whether there would be a sufficient number of applications to enable them to spend the money voted by parliament before the vote expired. Any application for a grade crossing project filed with the board receives careful consideration, and if the situation warrants it a proper appropriation is made.


Alfred Johnson Brooks: If it were a very dangerous crossing would the board wait for an application, or would they use their own judgment to eliminate it?


Clarence Decatur Howe: The board does not initiate
any projects; application must be made.


James Samuel Taylor: Who has control in a situation such as I will now describe? Somewhere close to the city of Grand Forks the railway passes over the main automobile road and there is a bridge constructed of stone and brick, I believe. The road crosses under the railway track, shall we say, from southwest to northeast, but as a result of some stupidness in the construction a gap has been left from southeast to northwest and the road has to be adjusted to go through that gap. This has made the crossing for automobiles extremely dangerous. Is there any supervision over such matters to prevent that sort of thing happening, or when it does begin are steps taken to control it before it is too late?


Clarence Decatur Howe: I hope my hon. friend is
not accusing any particular branch of the 51952-181}
government, because there are three parties involved, any one of whom might be responsible. The board of railway commissioners has an efficient engineering staff that looks after work of this sort, specializing in grade crossings. The work is carefully planned and supervised, and every precaution is taken against the sort of engineering mistake the hon. gentleman refers to.


[Stage Direction]
Item agreed to.
Board of Railway Commissioners for Canada -administration, maintenance and operation, including provision for the appointment of George Kydd as division engineer at a salary of $3,420 per annum, notwithstanding anything in the Civil Service Act, $262,040.
Mr. GREEN:: Does the department intend to increase the number of railway commissioners or increase their salaries in consequence of the new duties placed upon them by reason of the transport act?


Clarence Decatur Howe: Can my hon. friend tell me whether there is to be a transport act or not? There are six commissioners provided for by statute and there is one vacancy at the moment. It is not anticipated that the number of commissioners need be increased, although some additional staff will be required.


Hugh Alexander Stewart: This involves an increase of $22,053. The board of railway commissioners is an organization of some years' standing, with a pretty regular and well-established staff, and it might be interesting to know exactly why the increased expenditure this year is required. The minister might also tell us whether this is the first payment to George Kydd, whose salary is stated here to be $3,420. I notice that this appointment is made notwithstanding anything in the Civil Service Act. It would appear that this gentleman has been appointed to a position outside the provisions of the act. When was he appointed?


Clarence Decatur Howe: Restoration of salary deductions accounts for $10,000; statutory increases $2,000; increase to the secretary authorized by order in council, $500-that is a civil service position-and the position of division engineer to which Mr. George Kydd has been appointed, $3,420. That is not a new position. Then there is a temporary staff of three men. That makes a total of $17,000 in staff. Printing and stationery amount to $3,000; travelling expenses, $2,000; contingencies, $5,500. There were decreases in the salaries of the chief engineer, and the assistant chief engineer, and the deductions total $6,420, the net increase being $22,053.
2856	COMMONS
Supply-Transport-Railway Commission
As regards Mr. George Ivydd, he has been an employee of the dominion government for over twenty-five years, having begun on the Trent canal. When the work at Churchill was undertaken he was moved from the Trent canal to that port as engineer in charge. He was at Churchill from about 1919, or at any rate from the time the work was resumed after the war until the completion of the port. While there he was in charge of the entire operation, receiving a salary that was considerably more than he is now getting. We had no further work for him, that being the last construction job we had. Of course construction work at Churchill was not under the civil service commission, so that after twenty years of service

indeed, more than that, twenty-five years-he found himself out of employment and without a pension. He is admirably qualified for the work he is doing for the board of railway commissioners and they were veiy glad to have his services. Unfortunately he could not technically foe approved by the civil service commission, though they admitted that he was undoubtedly qualified. We are of the opinion, therefore, that we are justified in carrying him from year to year by naming him in the estimates.


Howard Charles Green: On page 227, which gives the list of employees whose salaries are included in this vote, there appears an item for a senior electrical engineer, special duties, at S600 per annum. Is he a regular employee of the government, or some outside engineer who is brought in for special work?


Clarence Decatur Howe: That refers to Mr. John Murphy, who, I believe, occupies three positions, one of them being that of electrical engineer to the board of railway commissioners; another is electrical engineer for the Department of Transport; and the third, acting superintendent of the Rideau canal. His position is under the civil service commission and the appointments are approved by the commission. It is purely a civil service job. The amount here represents a division of his salary; $600 of his salary is charged to this vote.


Howard Charles Green: What is his total salary?


Clarence Decatur Howe: His total salary from all sources is $5,520.


Grote Stirling: How near are we to the day when the present freight rate structure of Canada will be done away with and a new one, on a perfect basis, substituted therefor? It has appeared to me for a long time that never shall we do away with the
I Mr. Howe.]
preposterous anomalies which exist all over Canada until we get on a proper basis and away from this one which has just grown.


Clarence Decatur Howe: If my hon. friend can name a man who could design a perfect freight rate structure, he would help me more than I can say, and perform a service to the continent of North America for which there is not enough money in the treasury to compensate him. The freight rate structure has grown up over the years; it has been modified for this and for that; it is interwoven between the United States and Canada, and the task of scrapping it and starting afresh would be almost superhuman.


[Stage Direction]
Item agreed to.
Repairs and expenses in connection with the operation and maintenance of official railway cars under the jurisdiction of the department. ¥51,080.
Howard Charles Green: How many official cars are there, and for what purposes are they used?


Clarence Decatur Howe: There are four official cars owned by the government. One is allotted for the exclusive use of the Prime Minister. The author of the Railway Act, I am happy to say, made it mandatory for the government to provide a car for the exclusive use of the Minister of Transport. The Minister of National Defence has a car; I believe that situation arose during the war. And there is one car to be assigned to any minister travelling on official business.


Charles Avery Dunning: The fourth is called "the tramp."


Howard Charles Green: Is there also a regular staff engaged for these cars?


Clarence Decatur Howe: Yes; there is a porter for sach car.


[Stage Direction]
Item agreed to.
Hudson Bay railway-To provide for the difference between expenditures for operation and maintenance, and revenue accruing from operations during the year ending March 31, 1939, not exceeding $370,000.
George Halsey Perley: This is an item in which the western members are very much interested. I note that there is an increase in this vote. What is the total cost of operation and maintenance, and the total revenue? I trust the government are giving due consideration to that port. It is a very important port, and I have talked with different men interested in shipping who claim that for a considerable part of the year it is as safe as the St.

Supply*-Transport-Hudson Bay Railway
Lawrence waterways. I trust the government are not slackening in their efforts to make it a success. What effort is the government making to get business for that port?


Clarence Decatur Howe: The vote under consideration is for the Hudson Bay railway. I assume my hon. friend refers to a later vote for the port of Churchill. For the railway the cost of operation last year was $364,000, and of maintenance, $336,500, making a total of $700,500. The operating revenues were $364,000, leaving an estimated deficit of $336,500.
This year we are providing for operating expenses, $329,000 and maintenance, $370,000, or a total of $699,000. and we anticipate an operating revenue of $329,000 and are providing for a deficit of $370,000.


George Halsey Perley: How many vessels came
into that port during last year?


Clarence Decatur Howe: There were two cargoes
shipped out last year. There was one in and there were two out.


George Halsey Perley: What would the cargoes
consist of?


Clarence Decatur Howe: The incoming cargo was general merchandise. The boat is put on the berth at London for all goods offering for movement into western Canada by Churchill. It takes general merchandise, hardware, fencing, glass, binder twine, material of that kind.


George Halsey Perley: The outgoing cargoes were what?


Clarence Decatur Howe: Entirely wheat.


George Halsey Perley: As this Hudson Bay railway and the port are more or less the baby of the Minister of Finance, I trust the government are making every effort to make that port a success. I think if a little more advertising were done and effort made to get business, it might be put on a paying basis. If they could get another $370,000 worth, it would practically carry its operating expenses.


Clarence Decatur Howe: Last year, as my hon. friend knows, was a very exceptional year in grain traffic. There was a premium for cash wheat over the option as high as twenty-five and thirty cents, and naturally wheat at Churchill is not cash wheat. So market conditions put Churchill out of line last year. For a time Vancouver was in almost the same position. Some years ports have a good flow of the grain, and in others they do not. We did everything possible to attract grain to Churchill last year, but the best position we
could find would have required a cash contribution from the government of about eight cents a bushel to justify the movement of grain to Churchill.


Hugh Alexander Stewart: Are the expenses of the operation of the elevator included in this?


Clarence Decatur Howe: No; this is just the railway. The port is another item; we shall come to it later.


Howard Charles Green: V hat passenger and freight service is given on this railway? Would the minister give a short review of the present situation, the land of traffic that is carried, whether it is operated all winter, and other details?


Clarence Decatur Howe: In the summer months the train runs every second day between The Pas and Churchill. It is a mixed train, a way freight with passenger accommodation. That train leaves The Pas one day and comes back the next. Of course, when grain is moving, additional freights are put on as required. In the winter the service is cut down to one trip a month through to Churchill, but there is a weekly service between Gillam and The Pas. Gillam is about three hundred miles from The Pas.


Howard Charles Green: Is there any increase in the freight traffic, or are any mines being opened up along the railway?


Clarence Decatur Howe: As my hon. friend knows,
the Hudson Bay Mining and Smelting Company's mine at Flinflon is tributary to this line, as is also the Sherritt-Gordon mine. We have heavy traffic over the part near The Pas from these mines. Unfortunately no further worthwhile mining development has been discovered along the line.


Mr. CRERAR:: Before the item passes perhaps I may be permitted to say a word or two, because this railway is in the constituency I represent in this house.


Hugh Alexander Stewart: It is your baby just
now.


Thomas Alexander Crerar: Yes, and I am rather proud of the baby. The Minister of Transport has mentioned the mining development in northern Manitoba. It may be of interest to the committee to learn that to-day there are five operating mines in Manitoba north of the town of The Pas, four in the western part of the province and one in the eastern part. Seventy miles from The Pas, at Flinflon, is the Hudson Bay Mining and Smelting Company operation, which gives steady employment to 1,700 men, and produces copper, zinc,
2858	COMMONS
Supply-Transport-Hudson Bay Railway
gold, silver and some other rare metals. Eighty miles north of The Pas is the jumping-off place for another mine which came into operation two years ago and to-day gives steady employment, as I recall, to something like 150 men. Then, still further north, about 250 miles, is a point called Ilford, from which all the freight goes into the God's Lake mine in eastern Manitoba, and another development that is taking place east of that again in the province of Ontario at a place called Sachego lake.


Grote Stirling: Would the minister say
how many miles up the railway it is to that connection for God's lake?


Thomas Alexander Crerar: It is at a place called
Ilford. I am not sure of the distance, but my recollection is that it is about 250 miles.


Grote Stirling: Long before the crossing of the river?


Thomas Alexander Crerar: Yes, before we came to
the Nelson river. At the moment this is really a pioneer road. I have not the slightest doubt that if it had not been for the last eight years of depression the progress in northern Manitoba, as indeed in the northern parts of our other provinces, would have been very much greater than it has been. Undoubtedly, in this northern country, in Manitoba as well as in the other provinces, there are all the evidences of rich mineral possibilities. While I am aware of the popular notion held in eastern Canada with regard to the Hudson Bay railway; while I am awrare of the fact that some people fairly high in authority have condemned it, nevertheless I venture to say that the time will come when the Hudson Bay railway will justify its construction and operation just as much as the Temiskaming and Northern Ontario railway has justified its construction and operation in the province of Ontario. Even in my brief memory I can recall that when the Temiskaming and Northern Ontario was built there was a great deal of opposition to the spending of money to build a road into a wilderness that would never produce anything. Well, development has entirely belied those statements, and I am equally certain that the same thing will hold true of the Hudson Bay railway.
I might just add this, that I think Canadians generally fail to appreciate the possibilities of' the development of wealth in our northern areas. Certainly one of the essentials for that development is transportation. While it is true that we have been obliged to provide sums of money to make up deficits resulting from the operation of this
TMr. Crerar.]
road, I am quite certain that the day will come w'hen these deficits will cease and the developments along the road will be making a worthwhile contribution to the wealth of this country. It was unfortunate that, because of conditions in the west last year, no grain went to Churchill. Undoubtedly Churchill will ship grain; but last year Saskatchewan produced scarcely enough wheat for its own bread and seed, and under those conditions no grain was available to go to Churchill. My colleague the Minister of Transport referred to the market conditions that obtained during practically the whole season. Because of the scarcity of our hard wheat on the prairies, the cash premiums on spot grain went to as high as twenty-five or thirty cents a bushel over the future months. Consequently grain could not be sent to Churchill, or rather it could be sent there, but no dealer or trader would take the risk of purchasing it under these high premiums unless he was sure he could move it out to take advantage of the market at any moment.


Mr. WOODSWORTH:: The minister still thinks it is a practicable route for the future?


Thomas Alexander Crerar: I have never had any doubt of that, and I have never been more certain of it than I am at this time. That route will develop. The time will come when it will be one of the important trade and development routes of Canada. It may not be in our day, but that time will come. I am satisfied that in regard to northern Manitoba and the Hudson Bay railway we shall have a repetition of the very fine contribution that has been made by the Temiskaming and Northern Ontario railway to the development of northern Ontario.
I just wished to say this word in justification of this vote, because I would not want hon. members to continue in the view-if they hold it-that is held by some of our friends and critics in eastern Canada, that the Hudson Bay railway is simply a great sink-hole which never should have been built. It is a development road. The criticism may be made that it was built a little ahead of time. I do not think so. Certainly, if that road had not been built to The Pas and had not been extended further, we would not have had the great mining development that has taken place even in Manitoba within the last ten years. I am sure hon. members will agree that if this country needs anything to-day, it needs development of our hidden wealth, because only in that way can we reach a national income which will enable us to carry the

Supply-Transport-Hudson Bay Railway
burdens that have been placed not only upon the federal government but upon provincial governments as well.


Howard Charles Green: I heartily agree with everything that has been said by the Minister of Mines and Resources with regard to the importance of developing our northern country. The Minister of Transport has stated that there is only one train a month into Churchill during the winter. Is there any air service? If not, it does seem to me that those people should be given better service than one train a month.


Thomas Alexander Crerar: There is one train a month to Churchill from The Pas, it is true, but there is a regular service every week to a point something beyond mile 300, which serves the intermediate country. The monthly service to Churchill is sufficient to meet the needs of the town during those months of the year when the port is icebound. The weekly service supplies the mining areas on either side of the road that I mentioned a little earlier.


George Halsey Perley: What is the population of the port during the closed season?


Thomas Alexander Crerar: It depends upon the volume of trade.


Clarence Decatur Howe: There are about 200 people, including employees of the port, railway men and a few wives.


George Halsey Perley: How many are temporary and how many are permanent employees?


Clarence Decatur Howe: May I remind hon. members that for the moment we are discussing a railway item. When we reach the appropriate vote in the estimates, we shall give the information.


Howard Charles Green: Is the government doing anything to induce or to assist prospectors to get into the area by way of building trails or roads, so that they can get at the mineralized area? H so, what is being done? It is important, so far as the railway is concerned, because we know the railway needs traffic.


Clarence Decatur Howe: I would suggest that if the hon. member wishes to become clear on the point, he should take a trip over the line some time, especially when he talks about trails over the barren lands.


Howard Charles Green: I am asking for information.


Clarence Decatur Howe: The section near Churchill is not a very good prospecting country; we Shall put it in that way.


Howard Charles Green: Then the Minister of Transport and the Minister of Mines and Resources do not agree. There is something wrong there, somewhere.


Thomas Alexander Crerar: I dissent from the remark of my colleague the Minister of Transport. There is a lot of very good prospecting territory for several hundred miles north of The Pas; our geological reports so indicate. The same is true of northern Saskatchewan. I would make the statement for the first three hundred or three hundred and fifty miles along the railway, from The Pas, north.
Possibly at this point I should mention another interesting fact. The Hudson Bay Mining and Smelting Company at Flinflon have invested over 830,000,000 in that north country. They have a power plant on the Churchill river seventy miles north of Flinflon. A year ago they had to add an additional unit to that plant, and this year they are adding another one. I believe they will now reach their maximum development on the Churchill river. On the Nelson river, farther east, several hundred thousand horse power of electrical energy is capable of development.
My point is that the whole area is only in the beginning of its development. With the railway we now have facilities whereby prospectors can get in. With the aid of aeroplanes from The Pas and Flinflon they can cover quite a large area economically. Under the vote for mining roads which has been passed by parliament in each of the last two years, sums of money have been spent on small improvements here and there to reduce costs of transportation. The work may be that of taking rocks out of a stream to permit the passage of a loaded canoe or boat. It may be that of putting in a dam here or there to raise the water and make a stream navigable. It may be the work of clearing ground around a portage, or building short stretches of road. All these improvements cheapen the cost of getting essential materials into the country to help in its development. That procedure has been followed not only in Manitoba but in Ontario and Quebec, and particularly in British Columbia. I would say to the hon. member for Vancouver South that I doubt if there is any province in Canada which has benefited more from those expenditures than has British Columbia. We are trying only to carry along a sensible development. I do not believe I can add anything further; perhaps I have already taken up too much time of the committee.
2860	COMMONS
Supply

Transport-Hudson Bay Railway


Howard Charles Green: I suggest to the Minister of Mines and Natural Resources that he might be helped a great deal in the development of northern Manitoba if he borrowed the official railway car of the Minister of Transport and took that minister for a trip to Churchill in order to convince him with respect to the resources in the territory.


Thomas Alexander Crerar: I have already obtained a promise from the Minister of Transport, and I serve notice upon him here that I shall hold him to that promise to go to Churchill this summer.


Clarence Decatur Howe: So that there may be no misunderstanding, I have made more trips over the line from The Pas to Churchill and I have spent more time in Churchill than has any other man in the house.


George Halsey Perley: It would appear from his last statement that the minister must have had something to do with the building of the elevators there, before he joined the government. We must remember that the Minister of Transport is the member for Port Arthur. I do not think we shall find among the electors in that constituency much enthusiasm for the port of Churchill. Possibly the Minister of Mines and Resources was out of order in discussing the item. I must say, however, that he has not given much encouragement with respect to developments or efforts being made to make it a grain port. He has cited the premium on wheat at Fort William. I have no doubt the grain men who have interests at Fort William will never be great boosters for Churchill. I trust, however, that both ministers will set aside their personal interests in their respective constituencies and put forth a greater effort to get grain traffic to the port.


Mr. WARD:: I believe the building of the Hudson Bay railway was just a further example of the faith of our people in the future of Canada. I imagine that the gentlemen who sat in this house in the days when the Canadian Pacific railway was being built from eastern to western Canada, or in the days of early development at Montreal, heard the same questions asked as have been asked today with respect to Churchill and the Hudson Bay railway. It was my privilege to visit Churchill on the first passenger train which went to the port, at a time when the present Minister of Finance was Minister of Railways and the present Minister of Transport (Mr. Howe) was an engineer-


An hon. MEMBER:: Did he run the locomotive?


William John Ward: He was going to Churchill to lay the foundations for the elevator. That building has been referred to as one of the finest structures of its kind in the world. I have continued to visit Churchill for about two weeks each summer, because I like the place very much. Up to date I believe the railway has justified its existence and all the money which has been invested in it. Hon. members have spoken with respect to the failure of Churchill as a wheat port. I believe if those hon. members would look at the wheat quotations for October wheat in 1936 and 1937, they would find that on the option market alone there was in both years an average spread of about fifteen cents between October and May wheat. Would any one in this chamber who had money to invest, invest it in October wheat and store it at Churchill when May wheat was fifteen cents below the October price? Of course no one would do that, and I say that is the reason why the Churchill elevator has not been used.
If the west has a fair crop this year, it is my opinion that we shall not be able to handle the wheat offered to Churchill. We must have confidence in the future of that port. During a stay at The Pas last fall I got a car one afternoon and drove about fifteen miles up the Carrot river valley in the direction of Nipawin, and while on that trip I was amazed to see the wonderful quality of the land in the valley. I was told that there was a large acreage of land, with rich alluvial deposits, and free from stone, to be settled and developed. I have in mind one farmer about ten miles from The Pas who threshed
5,000	bushels of grain last year. I inquired from a man who had made a trip overland from The Pas to Nipawin, a distance of about 130 miles, and he told me that some day that district would be one of the finest agricultural districts in western Canada. I say to the hon. member for Qu'Appelle (Mr. Perley) that when that day comes, we shall not have anything to worry about as far as the Hudson Bay railway or Churchill is concerned. That railway will be one of the most important lines in Canada.


George Halsey Perley: I agree with what the hon. gentleman is saying.


William John Ward: All that is required is a little more confidence in the future of the country. We should appreciate the agricultural and mining possibilities of that north country. I am convinced that some day there will be half a million people on agricultural land between The Pas and Churchill. Only forty-two miles north east of The Pas I saw as fine vegetables

Supply-Transport-Hudson Bay Railway
as could be found anywhere in Canada. Grain ripens in that district, as do pumpkins and tomatoes. They can grow anything that can be grown in the Niagara peninsula, with the exception of peaches and a few things like that. In 1927 The Pas won the district prize for vegetables, competing with the whole province. The future of that country is just as assured as was the future of Montreal seventy-five years ago.
I rose in my place to criticize the government for the smallness of the vote being provided this year for this district. Large expenditures are being made in connection with Montreal and other points along the St. Lawrence river, but the expenditures for this district are quite small. I wonder if they are adequate? I have every confidence in the ability of the minister, and I know he is sympathetic toward the Hudson Bay railway and the port of Churchill. However, I submit that port will not be able to achieve its maximum development without the establishment of a bonded warehouse. A seasonal port like Churchill requires a place where an importer can store his goods until he is ready to distribute them throughout the country. A bonded warehouse does not mean that goods come in free of duty; it simply means that a place is provided in which goods may be stored and the payment of duty and other charges deferred until the goods are distributed. I had hoped that some consideration would have been given to this matter this year. There is a warehouse there at the present time, but it is not large enough. Perhaps a division could be made to provide for bonded facilities, but it would be better to extend the warehouse. An expenditure of 810,000 or $20,000 would permit of a considerable extension of the warehouse to accommodate the binder twine, glass, barbed wire and other commodities that are imported into this country to be used principally in western Canada. I hope serious consideration will be given during the coming year to the establishment of a bonded warehouse at Churchill.


Mr. MOTHERWELL:: Mr. Chairman, it will be recalled that I had my little say on this matter during the debate on the address. The minister was good enough to state at that time that he would give an outline of the activities of the department in connection with drumming up freight for this route. I remember I read the report of the debate in the papers next morning, and I saw where some one who should have known better referred rather disdainfully to the fact that there had not been a carload of wheat shipped through that port last year. I am sorry to
have to state that there have not been many cars of wheat of last year's growing shipped from Saskatchewan to any other port. We cannot ship what we do not grow. Present prospects would seem to indicate that we shall soon be getting back to normal production.
I do nob want to count chickens before they are hatched, but nature in the form of abundant moisture would seem to be setting the hen for a crop.
I was glad to hear the Minister of Mines and Resources (Mr. Crerar) speak so hopefully of this project. Churchill was a good port before Montreal or the St. Lawrence route had been used to any extent. It is true that Jacques Cartier landed at Gaspe four hundred years ago, but it was some time after that before any great amount of traffic was going over the St. Lawrence route. I do not want to be thought to be decrying that route; that is not my intention at all. I am glad to see these dredging expenditures being made, because, with our water disappearing, it is necessary to deepen and widen this route. I hope to see the day when Montreal will be an all year port. Everything would seem to indicate that this may happen. I believe our experts and scientists have the ability to perform a feat of that kind. If this can be done, then the same enterprise can produce relatively the same results for Churchill so far as safe navigation for four months in the year is concerned and possibly more.
I was quite encouraged to-day by hearing what I did hear. I could not hear the minister very well, or the hon. member for Qu'Appelle (Mr. Perley) or the hon. gentleman in the back benches from a Conservative riding, but I understand there was no disposition to discount the possibilities of the Hudson bay route. Two hundred years ago there was on the Prince of Wales island a fortification stronger than any other in Canada at that time. This had been built by the Hudson's Bay Company, possibly with the assistance of the British government. I nearly lost my political scalp when the matter of this port location was trembling in the balance. Perhaps I would have, if it had not been for the truth of that old Indian legend that you cannot scalp a bald man. However, that trouble has been satisfactorily overcome. I am hopeful that with a return to normal production and prosperity generally, we shall see millions of bushels of grain going through Churchill. I hope to see not only grain but other farm products, as well as a considerable incoming, movement of domestic requirements. After all, no port can hope for ultimate success without both incoming and outgoing freight haulage.
2862	COMMONS
Supply-Transport-Maritime Rates


George Halsey Perley: The hon. member for
Melville (Mr. Motherwell) has always been a great booster for the Hudson Bay railway; but I regret that on certain occasions when he could have exerted more influence to have this route built a little earlier, he did not take advantage of his opportunities. I can remember when the hon. member was interested in an election in 1908. We have a splendid theatre building in my town, and I can still remember the motto that was displayed at a Liberal meeting. It read: "Laurier will build the Hudson Bay railway, not to-morrow but now." We know when it was built; it was years later. The hon. member has always been a booster for this route, and I was glad to hear him express himself as he did.


Alfred Johnson Brooks: There was one remark made by the hon. member for Melville (Mr. Motherwell) to which I should like to take exception. He said that he hoped he would live long enough to see Montreal made a winter port. I am sure we all wish the hon. member for Melville, who is one of the grand old men of this house, many years of life, but I certainly do not wish to see him live long enough to see the port of Montreal one of the winter ports of Canada.


An hon. MEMBER:: Why not?


Alfred Johnson Brooks: "Why not?" The maritime
provinces have made sacrifices continually for the rest of Canada. Why should the western provinces, in order to save a few cents in freight rates on grain, which I assume would be the reason, wise to sacrifice the ports of Saint John and Halifax? That sort of thing has been going on for years; it is a sentiment which we in the maritime provinces resent very much, and I believe that sentiment is not shared iby many in western Canada and in other parts of this country.


Hugh Alexander Stewart: The minister stated that the expenditures at the port of Churchill might be found under another item. Is it under national harbours?


Clarence Decatur Howe: Yes.


[Stage Direction]
Item agreed to.
Hudson Bay railway-construction and improvements-capital, $25,000.
George Halsey Perley: What is the nature of this expenditure?


Clarence Decatur Howe: This is just a capital vote.
The amount asked for is required to continue the work started in 1908 on the Hudson Bay railway project. The construction of the railway is practically completed, and the

road is in good operating condition although it is likely for several years to require a certain amount of ballasting and drain filling to make up for the settlement and shrinkage which will undoubtedly occur in the embankments. This amount will provide for the excavation of off-take ditches, the elimination of timber trestles and the construction of cedar culverts where additional openings are required.


[Stage Direction]
Item agreed to.
Maritime Freight Rates Act-
To hereby authorize and provide for the payment from time to time during the fiscal year 1938-39 to the Canadian National Railway Company of the difference (estimated by the auditors of the said company and certified by the said auditors to the Minister of Transport as and when required by the said minister) occurring on account of the application of the Maritime Freight Rates Act, between the tariff tolls and the normal tolls (upon the same basis as set out in section 9 of the said act with respect to companies therein referred to) on all traffic moved during the year 1938, under the tariffs approved, on the eastern lines (as referred to in section 1 of the said act) of the Canadian National Railways, $2,278,000.
Clarence Decatur Howe: This item was considered
and approved in the railway committee, but I assume it should be called here.


Hugh Alexander Stewart: How is the increase of
8478,000	made up?


Clarence Decatur Howe: As was explained in the
railway committee, this is a statutory item and the increased requirement is due to increased business.


Hugh Alexander Stewart: The minister anticipates
that?


Clarence Decatur Howe: Yes. It is twenty per cent of whatever business moves under the Maritime Freight Rates Act. We had to supply a deficit on last year's operations, which has appeared in the supplementaries for last year. This year we are appropriating approximately the actual cost of last year.


[Stage Direction]
Item agreed to.
Amount required to provide for payment from time to time during the fiscal year 1938-39 of the difference, estimated by the board of railway commissioners and certified by the said board to the Minister of Transport as and when required by him, occurring on account of the application of the Maritime Freight Rates Act, between the tariff tolls and the normal tolls (referred to in section 9 of the said act) on all traffic moved during 1938, under the tariffs approved by the following companies: Canada & Gulf Terminal Railway; Canadian Pacific Railway, including: Fredericton & Grand Lake

Criminal Code-Sweepstakes
Coal & Kailway Company; New Brunswick Coal & Railway Company, Cumberland Railway & Coal Company, Dominion Atlantic Railway, Maritime Coal, Railway & Power Company, Sydney & Louisburg Railway, Temiscouata Railway Company, $860,000.
Hugh Alexander Stewart: Is this item also under the Maritime Freight Rates Act?


Clarence Decatur Howe: Yes. The previous item applied to the Canadian National Railways, and this one applies to the Canadian Pacific railway and other railways which receive payments under that act.


Hugh Alexander Stewart: To railways other than the Canadian National.


[Stage Direction]
Item agreed to.
Interest on rails rolled for Canadian National Railways: To provide for payment of interest under the terms and conditions of orders in council P.C. 1462 and P.C. 1533 of June 7, 1935, respecting orders of steel rails for the Canadian National Railway Company, $30,000.
Hugh Alexander Stewart: Will the minister explain this item?


Clarence Decatur Howe: Under the Public Works Construction Act of 1935. orders were placed for steel rails in anticipation of requirements, the provision being that the government advance to the railways a portion of the cost of the rails and undertake to pay interest on the balance until the rails were required. These rails have been gradually taken into stock as the railways could use them, and the $30,000 represents the interest on the rails which are still in store at the steel plants, and of which the railways have not taken delivery.


Hugh Alexander Stewart: Has the minister any idea when delivery is likely to be taken and the complete obligation terminated?


Clarence Decatur Howe: We are taking this year all our rails except a certain amount of 130-pound rails. The main line improvements have not been proceeding rapidly enough to give us any assurance when we shall be able to take the last of the 130-pound rails, but I think it will be in two or three years.


[Stage Direction]
Item agreed to.
Clarence Decatur Howe: Mr. Chairman, I move that the committee rise, report progress, and ask leave to sit again this day.
Progress reported.
At. six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.



CRIMINAL CODE


[Stage Direction]
The house resumed from Tuesday, March 15, consideration of the motion of Mr. Bertrand (Laurier) for the second reading of Bill No. 28, to amend the criminal code.
Mr. ERNEST BERTRAND (Laurier):: It is almost two months since we started discussing this question. When the debate was adjourned on the last occasion I intended to quote Mr. Peter McGibbon, at one time member of parliament for Muskoka, Ontario. In 1934 Mr. McGibbon said:
I am more concerned with the possibilities for good, with the amelioration of the sufferings of humanity, and the lessening of the economic wastage of the human machine through the instrumentality of this bill than I am with the methods or the disputed morality connected with it.
The abjections to this bill are all directed from the point of view of morality. I have received a large number of letters from persons throughout the country, a few in protest and also some marked copies of newspapers, to which I should like to direct the attention of the house. I have here a copy of The New Outlook, which, I believe, is published in Toronto. It is a marked copy, and there is in it an article entitled " Sweepstakes; a Moral Issue." The moral issue seems to be the scarecrow argument against sweepstakes. Here is an article that is typical . of a large number of others written against the bill. The author is a Mr. Mutchmor, who gives as his qualification the fact that he is associate secretary, department of social service and evangelism. I would ask you, Mr. Speaker, to bear that in mind- evangelism. I want to show how charitable the evangelists are in this instance. This is what the writer says:
"With an Ontario-Quebec gang-up" to compel the federal government to amend section 236 of the criminal code in order that Mr. Bertrand's bill to legalize sweepstakes may be passed, we find ourselves in danger of a gambling craze similar to that experienced just after the war. Mr. Bertrand stated in the House of Commons that such legalized sweepstakes would help the Catholic university of Montreal. Such an argument is hardly sufficient, when we consider the moral issues at stake.
I have already quoted another author who wrote on lotteries, H. M. Muller. She has
2S61
Criminal Code[DOT]-Sweepstakes

given a good deal of information and considerable data in relation to sweepstakes and lotteries. At page 64 I find the following:
The records show that by an act of parliament money was raised by lottery for the British Museum. Also England provided money for our Virginia colonists by means of a lottery. Thomas Jefferson heartily endorsed a lottery created by congress. John Adams and Benjamin Franklin obtained a "lottery loan" to meet government bills.
And so on.
I wish to call the attention of the house to one extremely uncharitable paragraph in Mr. Mutchmor's article. He says:
Perhaps one of the greatest moral weaknesses, if the proposed bill is passed, will reveal itself in the civil service.
All we are asking the house to do is to pass a bill which will permit of the organization of lotteries under the absolute control of the legislatures, and this gentleman who is typical of all those who are opposed to the bill, declares that the weakness is in the civil service. He says:
Corrupt practices endanger good government. We knew that before he said it.
We raise some pertinent questions: Who will receive the printing contracts? Which political friends will have the commission and sale of tickets? Whose nephews and nieces, cousins and sweethearts-
Mark you, Mr. Speaker, "sweethearts."
-will be employed as stenographers and clerks? The state has too small a credit on its moral ledger to extend any more business privileges to such a group as the gambling fraternity.
I strongly protest against such articles. Merely because we wish to give the provinces the right to permit the organization of lotteries for charitable purposes, I do not see how we can be opposed on the ground that the object is to give employment to cousins or nephews or sweethearts or anybody else.
An lion. MEMBER: What paper is that?


Ernest Bertrand: It is the
New Outlook, and the author of the article is Mr. J. R. Mutchmor, associate secretary, department of social service and evangelism.


Ernest George Hansell: What is he secretary of?


Ernest Bertrand: He is the
associate secretary of the department of social service and evangelism. That is all. That is what appears under the title of the article in this marked copy which was sent to me.


Ernest George Hansell: He must be secretary
of something.


Ernest Bertrand: I take it he is the associate secretary of the department of social service and evangelism. He is not identified any further than that. As I say, I have received a large number of letters and marked newspapers, and one letter that did surprise me came from the association of rural municipalities of Saskatchewan, because I had been told that in-the rural municipalities people were opposed to sweepstakes for charitable purposes, and when I showed this communication to my good friend the hon. member for Saskatoon I believe that he, too, was surprised. In March of the present year a resolution was passed by the Saskatchewan Association of Rural Municipalities at a meeting at w-hich there were 650 delegates. They unanimously voted in favour of the resolution supporting the present bill. I have here a letter from the secretary of the association. He says in part:
In my letter of the 25th ultimo I quoted resolution No. 33 which would come before the 33rd annual convention of this association which was held in Saskatoon on March 2, 3 and 4, 1938. I am now pleased to advise you that when the said resolution was presented to the 650 delegates there was not a single vote registered in opposition to the suggestion for legalization of sweepstakes for hospital purposes.


George Halsey Perley: Who signed that?


Ernest Bertrand: He describes himself as secretary, and his name starts with


Mr. YOUNG:: If his name starts with "G," the hon. member has the wrong secretary!


Charles Avery Dunning: In any case he is merely transmitting a resolution.


Ernest Bertrand: I would ask the hon. member for Saskatoon (Mr. Young), who knows every one of his constituents, to give me the right name.


Alexander MacGillivray Young: It is Mr. J. J. McGurran.


Ernest Bertrand: Since this bill was introduced, everyone knows that the Ontario legislature has passed a bill which is ready to be put into force; now we have the province of Quebec; we have such bodies as this association of Saskatchewan; we have resolutions of different municipalities in and outside the province of Quebec. I even got a letter from the secretary of the city of Calgary, asking me if the bill could be extended so that they could organize a sweepstakes to build a gymnasium for the young men of Calgary. We have the plebiscite that was taken in the beautiful city of Vancouver where the result was 27,000 for and 9,000 against, if I remember correctly.


Charles Avery Dunning: In favour of sweepstakes?

Criminal Code-Sweepstakes


Ernest Bertrand: Yes, in favour of sweepstakes.


Mr. BARBER:: A very large vote for a city of that size!


Ernest Bertrand: Well, I am ashamed to say I have never been west and have never been in Vancouver.


Harry James Barber: In the third largest city in Canada, 27,000 votes for sweepstakes!


Ernest Bertrand: Well, perhaps a lot of people who did not vote are of my opinion. Anyhow those who took the trouble to vote were three to one in favour of lotteries.
Since this bill was introduced, something very important happened. There was a drawing for the Irish Sweepstakes for the benefit of the hospitals in Ireland. The newspapers tell us that in Toronto alone there were about
300,000	people who had bought tickets, and that three times a year Torontonians were buying tickets to the extent of $1,000,000 each time. Does it not strike anyone that this money which is going to foreign countries should be made to stay here?


Harry James Barber: If this legislation were
enacted, would it stop the sale of Irish Sweepstakes tickets in this country?


Ernest Bertrand: My answer is that it would stop it to the extent that legislation for the control of liquor has stopped the illicit sale of liquor. I do not see why, if the government of Ontario or Quebec or any other province are interested in selling something for the benefit of their hospitals or universities, they would not go to the trouble of stopping illicit sale. I am sure they would to a very large extent. I do not know why any Canadian would buy tickets for the Irish Sweepstakes when he, could buy a ticket here the benefit of which would go to a charitable institution in Canada.


Mr. STEVENS:: He does not buy his ticket for that purpose.


Ernest Bertrand: Well, that is a question. I would not go to the extent of agreeing with my hon. friend, who implies by his question that the 300,000 Torontonians who buy tickets are buying them just for the sake of winning a large amount of money. It is the pleasure of buying the tickets.


Some hon. MEMBERS:: Oh, oh.


Ernest Bertrand: The average
intelligence of Canadians is high enough to know the chances they have when they buy a ticket. But they buy it for the pleasure of
it. And the pleasure would be much greater if they knew that the money was going to be invested in something that would benefit the community. We have a law which was passed in 1936. I do not know whether hon. members realize that when the best newspapers of Canada published last March the results of the drawing of the Irish Sweepstakes they were committing a criminal offence for which the president or general manager could be sent to gaol for one year. I have some newspapers here, among them Le Canada, which is a good newspaper, the Montreal Gazette, the Toronto Globe and Mail, all the newspapers of Ottawa; yet according to this law passed in 1936 amending the criminal code they committed an offence for which the manager or president could be sent to gaol for one year. It shows the fallacy of such laws. Let me read it. I leave out the words which are not necessary for the purpose of this argument. It is 1 Edward VIII, chapter 29, paragraph 7, amending section 227 of the criminal code. Common betting place is now defined as:
.	.	. an office, room or place which is
opened, kept or used for the purpose of facilitating or encouraging or assisting in the making of bets upon horse races by announcing the results of horse races whether such horse race takes place in Canada or elsewhere.
If we have reached the stage where we can put upon our statutes laws creating criminal offences which can be committed publicly right at the door of parliament, it is about time that we see to it, when we know that so many millions are going out of the country for this purpose.
I said the purpose of the bill is not to encourage the gambling habit; it is to keep that money here-


Mr. SPEAKER:: I am sorry to have to interrupt the hon. member, but he has exhausted his time to speak.


Ernest Bertrand: If he were the hon. member for Broadview (Mr. Church) I think he would vote for this bill.


James Shaver Woodsworth: Mr. Speaker, when the hon. member introduced his bill on March 15, he gave us his arguments in support of this measure, and I think that this evening he has added very little to those arguments.
First of all, he claims that this measure will put an end to illegality. That is a mere statement; there has been no information brought forward indicating that it will work in that way, and although one cannot bring statistical proof in a matter of this kind, undoubtedly general experience would seem to indicate that legalizing sweepstakes rather tends to encourage the practice of gambling. In any case there has been no evidence whatever brought before this house that it would put an end to it.
Again we are told that legislation of this kind might divert some of the money which now goes to Ireland. Again that is a hope, but notwithstanding what the hon. member has said to-night-


Ernest Bertrand: If it is true that so many millions of dollars are going there, what else can we do to stop it?


James Shaver Woodsworth: That is entirely another matter. This is not going to stop it; there is no evidence whatever that it will do so. In my judgment, which I give for what it is worth, if we go in for this sort of thing and encourage it, it is more likely to lead to still larger amounts going to Ireland or any other place where people think they can get something for nothing.
We are being asked to endorse this measure on the ground that it will help to support hospitals and universities, particularly the university of Montreal. Well, I am not going to be led away by an appeal for sympathy for one particular institution in one particular province. In dealing with the criminal code we should think of the whole of Canada, the welfare of all the people, rather than the welfare of some particular institution. I go down to Montreal now and I find that they support their hospitals, in part at least, by a tax on food. You cannot get a meal in a restaurant without paying that tax. I do not see why the wealthy municipality of Montreal and the comparatively wealthy province of Quebec cannot support these hospitals, as other provinces are able to do, through the taxes of the people or through voluntary effort.


Ernest Bertrand: This is a tax.


James Shaver Woodsworth: No, no. I wonder
that the hon. member suggests that; I cannot see anything analogous to a tax in this proposal. The hon. member says:
-if this bill were passed almost everybody, even the unemployed, would readily buy a ticket to take a chance on a sweepstake for the benefit of our hospitals and universities.
The hon. gentleman has just said that this is a tax; and, if it is a tax, he proposes to tax even the unemployed. That is going a long way. I should say the equitable way- decent thing-would be to tax the wealthy, who can easily afford to pay such a tax, not to try to wring it out of the poor people, even the unemployed, on the odd chance of their winning something. What a policy! Extract the very last drop from the poor, in the vain hope that by taking a chance of this kind they may get something out of it!
The hon. member administered a rebuke to the Social Service Council of Canada., Possibly it was merited; that is, if we interpret that statement which was read into Hansard as meaning we should not pass this legislation because of the effect it might have on church givings. I am not quite sure whether or not that is what it means, but I would say that churches and charitable institutions are in a veiy bad way indeed if they must live through the avails of a prostituted desire for gain. I hope the churches and charitable institutions have not sunk quite so low as that.
The hon. gentleman goes back several hundred years and tells us that some of the big universities were founded through lotteries. I have not checked that statement; it may be so, but in those days we had slavery and a great many other evils which we have since outgrown. He says the universities were bora in sin but they are not looked down upon to-day. Well, to put it in other words, that means that the end justifies the means. I think that is one of the ideas underlying the appeal we have heard tonight, that the end justifies the means. Some of us cannot accept that teaching.
The city of Vancouver has been lauded by the hon. member for Laurier. If he will go to Vancouver he will find that in that city birth control is openly advocated. I do not know whether or not he will laud that, but to be consistent he should be rather inclined to look to Vancouver for a lead along this line.


Ernest Bertrand: I did not
go back two, three or four hundred years, in making my statement about universities, because I could not find any examples to give as of to-day. Russia is one country where

Criminal Code-Sweepstakes
they have sweepstakes organized by the government; other countries are France, Spain, Italy, Germany, Denmark, Holland, Luxemburg, Australia, New South Wales, China, Sweden, Turkey, Mexico, Panama, Cuba, Serbia, Algeria, and the Argentine Republic.


James Shaver Woodsworth: The hon. gentleman gives us some further information. I am rather surprised that he goes to Russia to find an example. The other day he said:
-after all, universities like Oxford, Harvard, the University of Paris, were all started on lotteries

That was the statement to which I had reference. If I understand it aright, the principle underlying gambling is that we are trying to get something for nothing. "Something for nothing"-that is the underlying principle. Strip away all these other special pleas. It is the desire of certain people- and I think it is well founded-that in this way they can raise more money than in some other ways, but down underneath they rely upon the all too prevalent desire to get something for nothing.
I admit that the defeat of this legislation will not prevent gambling of a more serious kind, gambling in real estate, on the grain exchange, in stocks and shares and that sort of thing. Big gambling of that kind, which in my judgment is a much more serious type of gambling, is not touched by antigambling legislation.
Further, I submit that there is a difference between a man making an odd bet-whether or not that is justified I am not going to discuss-and the legalizing by this parliament of sweepstakes as a method of carrying on the necessary institutions of our country.
It seems to me, Mr. Speaker, that this country was founded on the ideal that prosperity should come to people not through chance but rather as the reward of patient industry. I do not think it is in the interest of our people that we khould turn ourselves into a nation of gamblers even to support the various concerns that need assistance. We have generally gone on the principle that people should support worthy institutions either by means of taxation or by means of voluntary contributions. The change proposed would be a backward step. I believe that more and more we shall have to raise our funds for social services through taxation. That is the fairest way of doing it, because in that way the incidence falls upon those who are best able to bear the load. Undoubtedly there are a great many things which will still have to be cared for by means of voluntary gifts. I hope in such cases, we shall still continue
to be in a position to give freely without having to be induced to give by the thought that possibly we may get back more than we give.


Mr. DANIEL McIVOR (Fort William):: Mr. Speaker, I rise to take part in the debate because of convictions which may be just as strong as those which prompted the hon. member to sponsor the measure. May I, first of all, congratulate him upon the literature he has been reading lately. We have been taught by our early teachers that the more we read about a thing the more we become like it; I would say that the New Outlook would come in the first rank of clean literature in Canada, and I should like at this time to pay tribute to Mr. Mutchmor, the social worker who wrote the article. I know the gentleman well; he is a better man than I am. I might not compare favourably with the hon. member who sponsored the measure, but I do know that Mr. Mutchmor is a better man than I am, morally, spiritually and intellectually. It is for that reason I believe that he would compare favourably with the best men in the house.
I did not get my reasons for opposing the bill from the New Outlook; I got them from my dad when I was a very small boy, at a time when I bet threepence on a donkey race. My dad talked to me reasonably and sensibly, and I believe that at that time the desire for gambling was nipped in the bud. I did not see much good in it then, and I do not see any good in it now.
I have three reasons for opposing the bill, and in the first place I would put the economic reason. A system of sweepstakes would be bad economics. I am sure there is not a member in the house who would not do his best to find some economic system which would kill unemployment, which would bring production to the highest point and distribution to the point of perfection, and all with the least possibly injury to any human being. I am convinced, however, that this end cannot be achieved by instituting a system of sweepstakes. When we are laying the foundations for the youth of Canada, the land of our adoption, we must think of those people in church, state and business who have tried to keep God first and others next. I am convinced that they have laid the foundation well, and woe betide the individuals who would try to switch us from that rock, the foundation on which we build.
The hon. member has said we should keep our money in Canada. I am wondering if there would be any sweepstakes tickets sold
Criminal Code-Sweepstakes

in the United States. As a boy I was taught that if I gave anything for a benevolent purpose, whether it was for a hospital or for a charity of some kind. I was to forget about it. I was told that if you cast your bread upon the waters it would return to you after many days. I say, therefore, that when we give $2.50 to a hospital we should not expect a cash return. Our payment would come through the well-being of those to whom we gave it.
When a man spends $2.50 he should expect to get at least three per cent for his money. I believe the Minister of Finance (Mr. Dunning) would say that that is a reasonable amount.


Charles Avery Dunning: It is a little high.


Daniel (Dan) McIvor: But when you purchase a sweepstakes ticket for $2.50 you have no assurance that you will receive back your money plus a small additional sum.


Ernest Bertrand: May I point out to the hon. member that if he were giving the money to charity, he would not expect such a return.


Daniel (Dan) McIvor: That may be so in theory, but it is not true in practice. If I buy a sweepstakes ticket, I am throwing in my lot with all the rest in the hope of getting $150,000, or some other enormous sum.
It has been said that licence kills or hurts the drink business. I am not so sure about that, and especially when I see that in Ontario we have a drink bill amounting to $72,000,000, a sum of money which would put a great many people to work. Who buy the sweepstakes tickets? We do not find any of the Scotch buying them-at least not many of the Scotch. They do not buy because they recognize that a system of sweepstakes is bad economics and represents a poor investment. We do not find any of our Hebrew brethren buying sweepstakes tickets; they recognize them as a bad investment and very poor economics. For the government to invite people to speculate, without even the pretence of promoting industry, is to hinder recovery, check stabilization and frustrate orderly development.
I find that the intelligent press is against sweepstakes, and in that connection I would quote the Ottawa Journal. Had I the time I could quote the Montreal Herald and the Montreal Gazette along similar lines. The Ottawa Journal makes the statement that lotteries are bad and, without reading the editorial may I point out that not one sentence

in it is in favour of a system of sweepstakes. I was amused when at one point the editor states:
The comparison of sweepstake with a horse race or a modest bingo game is far from exact. In the one case there is the element of amusement and the wager, if an important by-product, still is not the whole thing. But money spent for a sweepstake ticket brings no such return in entertainment.
A group of Chinamen may sit around a table and play their game of hong kong-or whatever you call it-and have a little fun. But when one buys a sweepstakes ticket I wonder what fun he gets from it?
The argument I use with greatest force and sincerity is that it is bad morality. The old commandment says: "Thou shalt not covet." I read somewhere that if you break the moral law, the moral law will break you. We must remember the commandment: "Thou shalt not covet." I do not think the parliament of Canada, with its three great divisions of King, Senate and House of Commons, can improve upon that moral law.
When I buy a sweepstakes ticket for $2.50, what do I expect to receive in return? I expect a return not only from my ticket but from the tickets of thousands of others, possibly 400,000 of them. It is bad morality, and it is a system whereby we covet what the other man has or may expect to get. When we attempt to support hospitals by sweepstakes and an appeal to the gambling spirit we are using a low method of supporting; any cause, whether it be moral or philanthropic.
Mr. Speaker, I say most respectfully that 1 try to reach the chamber on time each day regularly so that I may hear you coming before a great parliament and praying to lead us not into temptation. Yet I see people going through the country trying to convince our youth to buy sweepstakes tickets. I see a man of mature years approaching a young man and saying to him, "Here is a sweepstakes ticket; it will cost you only $2.50; take a chance." What is that man doing? It is against the temptations of such men that iwe must pray, "Lead us not into temptation." Those men are leading the youth into temptation when they offer tickets for sale at $2.50.
I cannot but think of some of the great institutions in Canada that get along very well without subscriptions of this type. We must take off our hats and pay our respects to an organization like the Salvation Army which does its work without respect of persons. If they resorted to sweepstakes for funds to carry on their work, they would be

Criminal Code-Sweepstakes
doomed. They have far more sense than to do that. The Canadian people do not need to have their sense of generosity stimulated by the hope of winning a sweepstake.
It is bad polities. I have great admiration for the premier of Ontario because I believe he has done many great things. However, I disagree with him in his stand on this question. I admire the members of his government who would not support the principle of sweepstakes. If I supported this resolution, I would be giving the premier of Ontario the right to give me a special appellation.
It is bad morality and it is bad politics. In 1906 an act was passed in England prohibiting betting and wagering in the public streets. That country understood the viciousness of anything in the way of sweepstakes. I should like to quote an editorial which appeared in the Montreal Gazette of May 3, reading as follows:
Contrary to universal opinion, the hospitals of Ireland are not in clover because of returns from sweepstakes, to which money is contributed from all quarters of the globe.
The Montreal Gazette is opposed to the principle of sweepstakes because it is bad morality, bad economics and bad politics. An editorial in the Montreal Herald reads as follows:
Medical men of Dublin, Ireland, are attacking the hospital sweepstakes, declaring that they have greatly injured the voluntary hospitals of the city.
At the annual charter dinner of the Royal College of Surgeons in Ireland, prominent medical men and others attacked the system.
They declared that the sweepstakes were started to help the hospitals but the government had stepped in and was collecting a tax of twenty-five per cent of the funds and diverting it to other causes. Out of this had sprung a demand for a municipal hospital and the scrapping of some of the voluntary hospitals which have been useful for many years. The protests may develop into a concerted drive against the sweepstakes.
Both the Montreal Gazette and the Montreal Herald are opposed to the introduction of sweepstakes into Canada. Many of our leading citizens are also opposed to sweepstakes. We have only to look around us here in this chamber to see many who are opposed to sweepstakes. The Prime Minister (Mr. Mackenzie King) has declared himself against this thing. The right hon. leader of the opposition (Mr. Bennett) has declared himself against sweepstakes. The Postmaster General (Mr. Elliott) took action in the city of Brandon and would not permit advertising of sweepstakes to be carried through the mails. I take off my hat to the Postmaster General for taking that action. I pray that 51952-182
it will not be long before he is back in the house. I admire him for his courage and the willingness to do the square thing. I see another man in this house who is opposed to sweepstakes, a gentleman whom I have known for forty years, the leader of the Cooperative Commonwealth Federation (Mr. Woodsworth). I would imagine that the leader of the social credit group (Mr. Blackmore) is also against sweepstakes because he does not believe in handing out money without getting something in return. Another reason for his opposition would be his own personal Christian character and his good, sound economic common sense.
It is the task of every good citizen to oppose gambling in every form, whether it is said to be for a good or for a selfish purpose. Our leaders have given us the lead and it is our duty to follow. I agree with those who say that we have no right to tell a man how he should spend his money. But, when it becomes a matter of public policy, we should let our judgment and conscience speak. The foundation of our great country is laid upon our faith in God and the common welfare of, our fellow men, and we should not be afraid to take a stand and vote against something which is not in the best interests of our fellow citizens.


Ernest George Hansell: Mr. Speaker, I should like to make just one or two observations with regard to this matter. Several preachers have spoken against this bill, and it would look as though this is a great day for preachers. It may be thought that we are assuming to be the custodians of the morals of the country. That is not necessarily so; but perhaps it may be said that the clergymen of this country, to use that term in a general way, are more or less responsible for the morals of the nation. They should be anyway. I am not saying that they are making a good job of it, but they should be and are interested.
I should like to follow the hon. gentleman who has just spoken (Mr. Mclvor) in what he has said with regard to the premier of Ontario. I have always regarded that gentleman as being a great man, but I did not relish the crack he took at the clergymen when he was commenting on their attitude toward his bill. It may be said that this is not the business of the clergy; but if it is not their business, whose business is it? I do not suggest for one moment that the sponsor of this bill is sponsoring it because he desires sweepstakes as sweepstakes. I give him credit for sponsoring this bill because he sees in it

Criminal Code-Sweepstakes

a new avenue by which money can be obtained for education, health and other purposes.


Ernest Bertrand: Whereby
money can be saved.


Ernest George Hansell: I do not know just how money would be saved. I rather agree with those who have spoken already when they say that to legalize sweepstakes will not necessarily keep any money in this country. We are continually looking for new sources of revenue. The hon. member for Fort William has referred to the economic aspects of this bill, but I should like to approach the matter from another angle. The hospitals, the universities and the other institutions that are in need of money, are in need of money because there are only two sources from which governments can get it, that is through taxation or by borrowing. The only other possible means of revenue is by some bill such as this. I do not intend to go into a discussion of social credit policies at this time, so no one need worry.
There is no reason in the world why we cannot make our economic system so fit into the picture of our national life that these institutions will be cared for and have the money they need, and that people who are ill	or need	false teeth	or new	glasses orwhatever else they may require will be able to	get it	without the	hospital	authorities[DOT]having to	go begging. These	institutions
should have the money that a proper money policy can give them, and that is my argument against sweepstakes being permitted simply because they are a source of money.
I referred to the clergy a little while ago. It	is their	business to	be, and	they are,
interested in anything that is for the welfare of mankind. I am wondering though, and I think I can speak along this line because I am one of the clergy myself, just how far the clergy of this country have studied the money problem and diagnosed the situation as it exists in regard to the creation of money, and whether it is not possible for money to be created, as it now is, for the purpose of running our national life-and you can apply that not only to the upkeep of hospitals but to the problem of relief. I have been in a good many ministerial meetings and listened to a good many speeches over the radio on such things as the degradation caused by improper housing, and I have listened to speakers on behalf of charitable institutions; but my impression has been, with my little knowledge of economics, that the speakers have not really gone to the root of the matter.
TMr. Hansell.]
It does not help the situation to give someone something out of our own pocket simply because that individual has no money. That does not remedy the economic problem, though it may help the individual to get by for an hour or two.
While I am on the subject of the clergy, I would say that it is the principle of running lotteries that we have to deal with. Unquestionably gambling is involved, and I do say, and perhaps this is one way in which I can bring the matter to the attention of the clergy of this country rather than by speaking to one or two locally, that we must sweep our own doorstep first. I say to the house through you, Mr. Speaker, that the principle of gambling, whether it is done through buying a sweepstakes ticket or a ticket for a raffle held in the basement of a church, is the same in both cases. I would suggest that the principle is a little bit worse in a lottery because when you buy a sweepstakes ticket you can at least pick your horse.


Some hon. MEMBERS:: Oh, no.


Ernest George Hansell: Some of my hon. friends do not agree with me. That shows I am perfectly honest in saying that I have never bought a sweepstakes ticket in my life.


Mr. EDWARDS:: You are the only one in the house who has not.


Mr. LEADER:: No, he is not.


Ernest George Hansell: In a raffle you take a chance and get what you pay for; but if you buy a sweepstakes ticket and win, somebody else has to pay for what you get.
I believe, Mr. Speaker, that the way to approach this question is not to deal with an individual matter like sweepstakes. There are other matters along the same line. It is not only hospitals that need money but universities, and many doctors in this country need money. There are a good many medical men in Canada who cannot collect their accounts to-day. I read in the Lethbridge Herald that at a medical convention in Saskatchewan the doctors threatened to move out of the province because they could not make a living there. So if you are going to have sweepstakes, the doctors should come in for a slice too. You can carry it to any extreme, and include all sorts of institutions. Where are you going to end once you legalize sweepstakes? The principle involved in the bill is one of gambling, and I am against anything that would make us a nation of gamblers.
On motion of Mr. Rowe (Athabaska) the debate was adjourned.

Supply-National Defence

The house in committee of supply, Mr. Sanderson in the chair.
DEPARTMENT OF NATIONAL DEFENCE Departmental administration, $425,720.


Ian Alistair Mackenzie: Mr. Chairman, before the hon. member for Vancouver South (Mr. Green) resumes the debate, may I say it is the intention to let this item stand after the general discussion has been concluded, so that any members now absent may discuss under this item any phases of defence policy. So, as soon as the discussion is concluded, another item will be called, and opportunity will be afforded to members present and those now absent to discuss all phases of defence policy under the item now before us.


Howard Charles Green: Mr. Chairman, for a few minutes before the house adjourned just six weeks ago-when the defence estimates were last up for consideration-I had been dealing with the problem of the defence of Canada's Pacific coast. I had pointed out that for the protection of that coast against major attacks this government seemed to be relying upon the American navy, there being no British navy within seven thousand miles, the nearest naval unit being at Singapore. I had also pointed out that there was no adequate defence on the Pacific coast a.t the present time against minor attacks, such as hit-and-run raids by ships carrying aircraft, and attacks to establish bases on our coast. I think the Minister of National Defence will admit that so far we have not on the Pacific coast adequate defences to protect ourselves against these minor attacks. I think he will also admit that defence against minor attacks is what is known throughout the British commonwealth as local defence, and as such is the responsibility of Canada alone. That principle has been established throughout the commonwealth for many years, and I would refer the members of the committee particularly to the summary of the proceedings of the imperial conference held in 1923, at page 16, in paragraph 3 (a):
Subject to this provision, the conference suggests the following as guiding principles:
(a) The primary responsibility of each portion of the empire represented at the conference for its own local defence.
That principle was reaffirmed at the imperial conference in 1926, and again at the conference in 1937. At all three conferences the Canadian delegation was headed by our present Prime Minister. The principle means simply that Canada must defend her own coasts 51952-182}
against minor attacks; and as minor attacks are the only danger at the present time, on the Pacific coast at least it means that those Canadians who live on the Pacific slope must look to the Canadian defence forces for protection.
There is the problem; and while the government is doing something about it-and I give the government and the Minister of National Defence credit for what has been done in the way of improving our defences on the Pacific coast-I submit that this government is failing utterly to deal with some aspects of the problem. I believe its greatest failure is that it has not provided, and apparently is not taking steps to provide, for an adequate coastal defence fleet. It is obvious that we must have such a fleet. The minister himself so stated during the Easter recess, and if the newspaper report from which I propose to quote is not accurate, I would ask him to correct it. It is an article appearing in the Vancouver Daily Province reporting the minister's speech in that city two or three weeks ago, and reads in part:
For defence of our focal sea areas we need sea and air forces capable of destroying hostile surface craft, submarines and air raiders. This requires reconnaissance, fighter and torpedocarrying aircraft, and adequate naval strength
Then he went on to say:
To defend our neutrality wre need constant patrol of our coastal area by auxiliary surface craft and aircraft, bombing aircraft to destroy bases, means to dispatch small expeditions.
It is contemplated that naval and aircraft will patrol the entire eoast from their respective stations.
That all means that we must have an adequate fleet on the Pacific coast. He might also have mentioned the fact that we have on that coast to-day at least 1.200 Japanese fishing vessels operating in and out of the different harbours and ports, which might have to be dealt with in the event of hostilities with Japan. In his speech in introducing the defence estimates, the minister said as reported at page 1647 of Hansard:
A certain amount of priority has been established after deliberation: first for the air services; secondly, for naval defence; and thirdly, in regard to the repairing of deficiencies in equipment of militia services, permanent and non-permanent.
That is the position taken by the government itself; yet what do we find? In these estimates provision is made only for two secondhand or used destroyers, which are to be purchased from Great Britain. These ships are to be placed on the Pacific coast where we shall then have four destroyers and two mine-sweepers. That will be the extent of our fleet. Apparently the government is
Supply-National Defence

buying odd ships from year to year; it appears to have no plan whatever as to the size of a Canadian navy or as to the time when it is to be completed.
If there is a plan, it should be announced. The Canadian people should be taken into the confidence of the government just as has been done in Great Britain and Australia; within the past few weeks we have seen press reports of the ships to be added to those other empire fleets; surely the Canadian people are entitled to have similar information with regard to the Canadian navy. One would think that the Department of National Defence would at least have decided upon the minimum naval requirements for the local defence of the Canadian coasts. If so, the Canadian people should know what that plan is. If the department has not such a plan, it is derelict in its duty.
I can find no report anywhere of plans for a Canadian navy. The only thing of the kind I have been able to trace is the recommendation submitted by Admiral Jellicoe when he came to Canada in 1919 on a naval mission at the request of the then Canadian government; he recommended in his report, at page 10, chapter 1, dealing with the naval requirements of Canada, paragraph 4:
The question of the naval forces required by Canada may be viewed in two ways: first, in the light of Canada's own requirements, and Canada's own safety; and secondly, in the broader light of the security and safety of the empire as a whole. The naval force suggested as adequate purely for the protection of Canada's trade and Canada's ports under tne conditions assumed, comprises-
And this is what he recommends as a minimum for a Canadian defence navy:
-three light cruisers, one flotilla leader-
Which, I believe, is a large destroyer.
-twelve torpedo craft, eight submarines, with one parent ship, and certain auxiliary small craft for training purposes, etc.
That was immediately after the great war when the danger was nothing like what it is at the present time. It does seem perfectly clear that in Canada we require at least one or two flotilla leaders and more destroyers as well as submarines, motor torpedo boats, and submarine chasers which can be used to attack hostile fleets. We have at the present time no ships for that purpose. We also require craft for laying out and protecting mine fields and a mosquito fleet to patrol and protect our inlets. All these small craft could operate only within a few miles of our coasts, so that no one could say they were for purposes of aggression. I suggest that a coastal defence fleet of this type might be

established this year-not in four or five years, but this year-by borrowing ships held by Great Britain in reserve. I understand that they have many ships of this type being held in their ports in reserve, which could be on loan until Canada had completed her own navy. Many of the smaller ships could be built here. We have shipyards that could do that work, and it would give a great stimulus to the shipbuilding industry of the country. The government could take steps at once to start a building program for the construction of a defence fleet. So much for the navy.
Then, I submit that the government is not facing the problem of defending our coasts, because it is taking no adequate steps to have not only ships but also aircraft, guns, munitions and equipment manufactured in Canada. There is a plaintive wailing by the government about being unable to buy: they cannot buy anything; their hands are tied. The minister said, as reported at page 1648 of Hansard:
Difficulty has been experienced with reference to obtaining deliveries, and that has accounted for another part of the reduction.
At page 1649:
With reference to militia services there has been carried out by the department what is known as an interim plan of armaments for both coasts. This is a result of the fact that heavy ordnance cannot be acquired from British concerns for a period of about three years.
In other words, we have to sit back and be inadequately defended for a period of three years. Canada might just as well face the fact now that other nations are too busy preparing to defend themselves to be able to sell us arms; that if Great Britain is at war we cannot expect to get war material from her; and that future wars will be largely mechanized, requiring primarily machines which we are able to manufacture in this country if only we have the energy to do so.
Then, the government is not facing the problem of defending the Pacific coast, because it is not setting up naval or defence reserves on that coast. There are many strategic points on the mainland and the islands which should be held by the government; the property there should be acquired. There is nothing at all now to prevent, for example, the Japanese government from indirectly acquiring land, timber rights or mineral rights, at these strategic points or near our bases or fortifications. As a matter of fact, we hear rumour after rumour that such is the case. This is not good enough; the government should reserve these strategic points. I suggest to the minister, with all the seriousness I can, that, he have a survey

Supply-National Defence
made as soon as possible of the ownership of the land and timber and mineral rights at these strategic points and near fortifications and bases, and particularly a survey such that it will show which of these lands and rights are held by or for foreigners.
The government is also failing to face the necessity, from a military point of view, of highways to the Pacific coast. At present we have no highway across British Columbia. The trans-Canada highway is impassable because there is a gap of about thirty-three miles; the government builds a little this year, a little next year; it is to be completed in 1939, we hope; but that road should be completed at once, because it is a strategic road. Further, there is no road through southern British Columbia; there is a gap in the Princeton-Hope road of about thirty-seven miles, which should also be built for strategic purposes; and we should have a highway through to Prince Rupert or Stewart. These would all be strategic highways and should be the concern of the Department of National Defence as well as, say the Department of Mines and Resources.
Finally, in connection with the failure of the government to face this problem of defending the Pacific coast, I doubt very much whether there are sufficient trained men in British Columbia to man the fortifications we have there, or will have, to protect the bases, and to repel raiders. I believe there are one or two hundred men of the permanent force-the minister can correct me if I am wrong-and according to the last report of the department, about 2,550 men of the militia. That is the total number who underwent training. I suggest that the minister allow the British Columbia units to recruit up to a strength which will provide the people in that province with a force sufficient to man the fortifications, protect the bases and repel raids; further that these militiamen on the coast should be fully equipped at once and given the best training possible. It is not fair to men who volunteer to risk their lives in the defence of the country to leave them half-equipped and half-trained. Nothing is more unfair on the part of a national government.
I suggest that these features of the problem of defence of our coasts are sufficiently serious to warrant an investigation this year by a special committee of this house, representative of all parties. I believe it would be possible for us to agree unanimously on a policy for the local defence of our coasts. That agreement can best be obtained if the government will set up a special committee, with all parties represented on it, and place
all the facts before that committee. So much for the problem of local defence.
Turning to the broader aspects of Canada's defence problem, the minister admitted, and I think will admit to-night, that Canadians can defend themselves against major attacks only by cooperating with other nations; for example, on the Atlantic with the British fleet. It is quite clear that Canada must cooperate with the other nations of the British commonwealth. Actually the government is doing so now, but will not admit it. This pretence that we are not cooperating with the other nations of the British commonwealth, this "Hush, hush" policy, misleads the Canadian people and weakens the British Commonwealth of Nations in the eyes of the other nations of the world, and the result is to hurt us here as far as the defence of our country is concerned. Actually every Canadian government since the war has cooperated in defence measures with the other nations of the commonwealth. One has only to refer to the imperial conference summaries for 1923, 1926, 1937. Our present Prime Minister was in command of the Canadian delegation at each of those conferences, and we find the principle laid down as clearly as possible that Canada is to cooperate with the other nations of the empire in defence. In 1923 they stressed naval bases at page 16 of the summary of proceedings: in 1926, air bases, at page 29. Then I quote from the summary of proceedings for 1937 at page 12:
Though -we shall discuss other important sublets- we are agreed that questions of foreign affairs and defence shall be our main subjects.
At page 1649:
The conference gave close attention to the subject of defence, and considered ways in which it would be possible for the governments concerned to cooperate in measures for their own security. The occasion was taken for a detailed review- of the state of defence in each of the countries represented at the conference and this opportunity was generally welcomed.
At page 18:
The conference recognized the vital importance of measures to safeguard maritime communications, including routes and waterways essential to defence and trade, and to provide naval bases and facilities for repairs and fuelling of ships.
At page 19:
The conference also recorded the progress made by the several governments in creating and maintaining an adequate chain of air bases and refuelling stations along the lines of communications between the different parts of the empire.
The conference noted with satisfaction that in accordance with recommendations of previous conferences a common system of organization and training and the use of uniform
Supply-National Defence

manuals, patterns of arms, equipment, and stores had been adopted, as far as practicable, for the naval, military and air forces of their several countries. Each of them would thus be enabled to ensure more effectively its own security and, if it so desired, to cooperate with other countries of the Commonwealth with the least possible delay. The interchange of individual officers of the naval, military and air forces of the countries was recognized as conducing to the dissemination of the experience acquired by the officers concerned under the widely different conditions existing in various parts of the empire .	.	.
The conference gave careful attention to the question of munitions and supplies required for defence both by the United Kingdom and other parts of the Commonwealth, and also to the question of the supply of food and feeding stuffs in time of emergency.
In other words, Canada is in alliance for defensive purposes with our kinfolk, the other nations of the British commonwealth. It is the safest and wisest defence program we could adopt. All these British nations are aiming at peace and not war. At page 13 of last year's imperial conference summary we find this:
Thus they agreed that for each member of the commonwealth the first objective is the preservation of peace. In their view the settlement of differences that may arise between nations and the adjustment of national needs should be sought by methods of cooperation, joint inquiry and conciliation. It is in such methods, and not in recourse to the use of force between nation and nation, that the surest guarantee will be found for the improvement of international relations and respect for mutual engagements.
Holding these views and desiring to base their policies upon the aims and ideals of the league of nations, they found themselves unanimous in declaring that their respective armaments will never be used for purposes of aggression or for any purpose inconsistent with the covenant of the league of nations or the pact of Paris.
Then, further down on page 14:
Being convinced that the influence of each of them in the cause of peace was likely to be greatly enhanced by their common agreement to use that influence in the same direction, they declared their intention of continuing to consult and cooperate with one another in this vital interest and all matters of common concern.
It is our safest course because all the nations of the commonwealth are trying to agree on the fundamental principles of foreign policy. For example, they are all trying to collaborate with the United States of America. Further, we know these peoples of the British nations; we know we can depend upon them; we know we can trust them. Those of us who served overseas know that, if trouble arises, you can have no better men beside you than the men from the other parts of the British Empire. There is very little risk of one nation of the commonwealth doing anything that will drag the others into war. We have seen that

within the last few weeks, in the attitude taken by the Prime Minister of Great Britain. And remember this. Mr. Chairman: Any Canadian foreign policy necessarily must involve some risk, and my submission is that any other policy than that of working with the other nations of the empire would involve far more serious risks.
My complaint against this government is that instead of focusing the attention of the Canadian people on the fact that our foreign policy actually is a defensive alliance with the other nations of the commonwealth, with peace as the aim, and collaboration with the United States and friendliness with all nations, this government keeps harping on the fact that its hands are free, that it has no commitments. This government says: "Oh, we can be informed by the British government of what goes on; but we cannot be consulted, because that might involve some obligation upon us." as though the policy of working with the other nations of the British commonwealth were something to be ashamed of. This attitude on the part of the government is entirely out of line with the courage and clear-sightedness of the Canadian people. In my opinion the government policy could be best described as spineless.
F'inally, in considering the question of Canadian defence and Canadian foreign policy one instinctively thinks of the nationhood of the Canadian people and of the Canada of the future. As a nation we have done many worthwhile things. For example, our part in the great war gained us the respect of all the civilized countries of the world. The part we have played in the League of Nations has been more outstanding than that of any other nation in the Americas. Like Great Britain, we have done what we could to further disarmament among the nations. We have become one of the leading nations of that group which ranks immediately after the seven great world powers; in fact, I believe even in population Canada is among the first twenty nations of the world. Canada is now at a fork in the road1. Are we going to bury our heads in the sand, -and depend upon other peoples for our defence, which means for our very existence? Are we going to refuse to look beyond the borders of Canada? I would suggest that the attitude of this government would lead any reasonable Canadian to believe that such was the case at the present time. If we take that road, probably we shall end up as a small American republic. Or are we going to continue to be a nation, taking a worthwhile part in world1 affairs, facing these problems

Supply-National Defence
of defence and foreign policy frankly and fearlessly and letting the other nations of the world know exactly where we stand, yet with world peace always our main objective? This government, with its great majority, the largest number of followers any Canadian government has ever had-I sometimes think they would be glad to lose a few of them-should be the strongest government Canada has ever had. It has a great opportunity to give leadership to the Canadian people in connection with these problems. If it will remember the Canadian character; if it will act with the initiative, the soundness, the friendliness and the courage of the Canadian people, it will not delay any longer in leading them along the second road.


Charles Edward Johnston: At the outset I wish to say that I agree almost entirely with what has been said by the hon. member (Mr. Green) who has just sat down.
I particularly noted one expression he used, that all nations were seeking peace. I think that statement is true, generally speaking; I do not think of any nation that would be an exception to that rule. I believe every nation in the world-


Mr. MacINNIS:: Does the hon. member think Japan is seeking peace?


Charles Edward Johnston: I shall come to that in a moment. I have learned that when a lawyer is faced with a question he does not want to answer, he always says he will come to that in a moment, and I am learning from the lawyers. I think Germany is seeking peace. I do not think the people of Germany want to go to war any more than we do. I cannot bring myself to believe that the German people are desirous of throwing themselves into a conflict.


Richard Langton Baker: Have the people any say in the matter?


Charles Edward Johnston: That is a different proposition. I do not think the people of Japan are any more desirous of having their young men go out and be killed than we are. I do not think China is any more desirous of war than any other nation. I do not think Italy desires war. The fact that the government of a country has thrown that country into war does not mean that the people share that desire. That is one thing that we are contending right in this country. If we went to war, would it be a case of the people desiring that war? I shall speak of that a little later on in my address; but I believe we have taken the wrong road, and I
believe we are still taking the wrong road if we are looking for a permanent solution of this question of war.
From speeches I have heard in this house; as I have read the press, and from articles that have appeared on different occasions I have come to the conclusion that the greatest strife in this world is competition, which travels through nations, through dominions, through municipalities and right down to the individual. We have always contended that competition was the life of world trade; but I am not so sure that this has been the correct reasoning, especially when we look about us and see that, almost without exception, in the end this rivalry in trade leads to war. I think we had a very good example of that not so long ago in connection with the oil industry of Mexico, which showed just how nations may become involved in competition for trade and through large financial concerns. Rightly or wrongly the Mexican government took possession of the oil fields of that country. Immediately we had representations made by the governments of the United States and Great Britain in an endeavour to get back those oil fields. In that case I think it was the financial interests who were influencing the government, more than it was the desires of the people. Surely that was Mexico's own business. Yet we were interfering there with another nation in connection with the control of its natural resources. Whether that control was or was not going to be carried out to the best advantage of all concerned, we cannot say. Yet that was their policy.
I believe if we go back to find out the causes of war we would be getting nearer the solution. I am thinking now of war in the broader sense, and not of the war where there are battles for the purpose of killing people. We have war in the state from the rivalry of individuals. Man has to make a living; so he is continually combating his neighbour for a better economical situation, and this combat leads to keen rivalry. The individual reaches the state where he becomes financially embarrassed and must appeal to the municipality. The municipality on the other hand becomes equally financially distressed, and looks around for help. The municipalities must do that because they find great competition in financial matters. It is their desire to get a greater amount of revenue. Finding themselves at a loss they turn to provincial authorities, which are already overtaxed. It is not possible for the provinces to increase their revenues and so, in turn, they come to the only source left,
Supply-National Defence

namely the dominion. Then, the dominion is so overwhelmingly in debt that it has almost reached the limit of its possibility of getting greater revenue. Facing that condition, the dominion must endeavour to borrow from other nations. It must try to meet its debts by increased trade, and eventually conditions become so intense that a physical war breaks out.
I read the other day an interesting quotation from the observations of Henry W. Morgan of Montreal, chairman of the executive of the Canadian Chamber of Commerce, in which he stated that to-day Canada had piled up an indebtedness of over eight billions of dollars, or about S800 per person. He pointed out, and properly so, that this huge debt would go on piling up indefinitely, and that inevitably there must come a day of reckoning.
We now have a rearmament program in which we are about to spend 834,000,000. In Great Britain they are spending thirty-eight billions of dollars or about 8800 per person. There is a new seven and a half billion rearmament plan, and it will continue to grow. In the United States the national debt is about thirty-nine billions, or $325 per person; they have a new five and a half billion dollar rearmament plan, and it is still growing.
Where will this economic system lead us? Does anyone think that these huge debts can be paid out of taxation, or in some way, by people or governments, or that any government will solve this problem of debt by simply creating another debt? Our present debt system requires the formation of a system of national credit for the creation of wealth and happiness for our citizens.
We are coming closer to the real cause of war when our financing puts us into such a position that it is almost impossible for us to go ahead and prepare for war without creating a still greater national debt, a national debt which we shall never in the world pay off. The other day I was speaking with respect to debt to a very able man in this city, and he said he did not believe that it would ever be paid off, and added he believed that theoretically it would be wrong to pay it off. Yet we are going ahead and taxing our people. Over fifty per cent of the taxes they pay goes to pay interest on our tremendous debt. Without exception, every country in the world faces a similar situation.
What is the cause of this debt? Why has it reached such dimensions? I believe one of the greatest trading opportunities we have is right around us; our greatest market is right here in Canada. Until such time as we have

satisfied the needs of our own people we should not turn our attention to other markets. We find all nations endeavouring to increase their trade simply because competition is becoming so keen. They are endeavouring to turn their attention to other countries. Why are they doing that? Do they do it because they want to go to other countries and kill? I do not think so. I do not believe Italy went into Ethiopia with only the desire to kill the citizens of that country. I do not believe, when Germany entered the last war, she did so merely for the opportunity of killing. She went to war for a definite purpose, namely to extend her boundaries.
Why did Italy or Germany wish to extend their boundaries? They had that desire because the great nations are becoming overcrowded and because they were searching for further supplies of natural resources. Circumstances compelled them to take such action. They have been compelled through circumstances which we, ourselves, as a world people, have built up. The whole matter has evolved itself into a European situation, one which, as was stated by the hon. member who just took his seat, in some way or another we must be above.
I do not believe we can sit idly by and permit ourselves to see the policies of other nations drawing us into a web which is eventually going to turn to war. It has been pointed out that in the house we must be cautious as to the remarks we make respecting the policies of other countries. There is a fear that observations might draw us into a serious situation which could develop into war. The European situation, however, has a bearing on the situation right here in Canada.
When we turn for a moment to look into the European situation we find that not very long ago Germany annexed Austria. It is somewhat of a coincidence that not long ago in this city I was speaking to an individual- not the one about whom I spoke a moment ago-who was well versed in foreign affairs. With respect to this question he said to me that the annexation of Austria by Germany should never have been permitted in the manner in which it was accomplished. He claimed that the greatest mistake was made at the conclusion of the last war, and it was his opinion that it was inevitable that Germany should take Austria. He then asked why we should prolong action until a time when Germany was forced to enter Austria and take it in the manner in which she did.
Germany learned a great lesson from the last war. We know how it developed-through transgressing the rights of Belgium. The

Supply-National Defence
invasion of that little country was what caused the entrance of Great Britain. Germany has now learned her lesson. We see that this time she did not attempt annexation in that way, but was content to use another and a more clever device which achieved exactly the same purpose.
Since the last war Germany has grown up to be a tremendous nation, and it has been stated over and over again that she did not have sufficient people to do the work she had outlined. Someone may say, "Oh, yes, but she conscripted all her men for the army." I do not care what she did with them. The fact remains that there were no unemployed. We condemn her methods; but through all the criticism we pass upon Germany it must be clearly remembered and understood that the Germans are an intelligent people, and the very fact that the followers of Hitler are found in such large, numbers is proof that the German people are doing a great deal of thinking. They must of necessity be behind Hitler. Whether his plan be right or wrong-


Richard Langton Baker: Is the hon. member not going too far afield in his discussion of defence for Canada?


Charles Edward Johnston: I have not gone as far as some other hon. members. I am trying to keep in my mind the principles which lead to warfare, and I cannot see how I am out of order. I leave it to you, Mr. Chairman, to state whether or not I am in order.	.


Richard Langton Baker: Surely the question of defence for Canada does not involve the affairs of Europe.


Charles Edward Johnston: That is a
question we should consider.


Ian Alistair Mackenzie: With respect to the point of order, may I say that ordinarily the point raised by the hon. member would be well taken, but there was an understanding that under this item all questions of policy could be discussed by hon. members. '


Charles Edward Johnston: I appreciate that.


Richard Langton Baker: Of all other countries?


Charles Edward Johnston: I believe, if the world had taken advantage of the situation before Germany annexed Austria, we would have saved ourselves a great deal of trouble. As I stated last year-and I have not changed my stand in the meantime-I believe there should have been a conference of nations; probably the best results could have
been obtained through the League of Nations, but such conference should have been held. Take the case of the annexation of Ethiopia by Italy. This conference could have been called, and if it could have been shown that Italy needed more territory or access to more raw materials in order to keep up her industrial life, then possibly these matters could have been settled. I do not say that consideration should be given to the need of materials for the manufacture of muntions. This is something to which we shall have to turn our attention sooner or later. We shall have to see that all nations are satisfied as far as their domestic requirements are concerned. Other countries that have natural resources in abundance may possibly have to cooperate. This is one of the things that must eventually come about.
I should like to refer to the invasion of Ethiopia by Italy because it leads up to another point in my argument. I think it is generally conceded that when that occurred most countries objected, but the tables have now been turned. It is rumoured that the British Empire is to concur in that annexation and permit Ethiopia to become part of the Italian empire. I cannot see how Canada will be able to keep out of these things. As the hon. member who has just taken his seat has said, when Great Britain goes to war, Canada goes to war whether or not we like it. That is stated definitely in the statutes of Canada. When Great Britain is at war, we are at war. If we are going to be involved in these matters, then I think we should give serious consideration to the manner in which we are going to be drawn into them.
There is another question in which I think Canada should concern itself. Mind you, Mr. Chairman, I am not saying that we should concern ourselves in these matters to the extent that we would be ready to take any part in action that might be taken by other nations. If we are going to participate in these matters, then we have to expect the natural results. There is another situation arising in connection with Czechoslovakia. In my opinion the geographical location of that country is such that it is bound to be taken over by Germany, not in the manner in which Germany attempted to expand in 1914, but in a manner more like the annexation of Austria. Who is there to stop her? No force was used in connection with Austria; it was simply a matter of nazi-izing, if I may use that term, the country. The same thing will occur in Czechoslovakia. That country is going to be taken over whether or not we like it. Russia has guaranteed protection to
Supply-National Defence

Czechoslovakia. France has guaranteed protection to Russia. Great Britain has guaranteed protection to France. Where does Canada come in?
The point I wish to make is this: Is Canada prepared to enter a European war because of Czechoslovakia? Is Canada prepared to enter a war because of a conflict between Ethiopia and Italy? Is Canada prepared to participate in a war between China and Japan? Is she prepared to do these things any more than she would be prepared to go to war with Germany because of the annexation of Czechoslovakia? I think not. That is something about which we should not concern ourselves. As I have said before in this house, I do not think we should interfere with other countries. We should attend solely to our own affairs. I do not say that we should break away from the British Empire; I say that Great Britain should adopt a similar policy. If all the British Empire stayed together, there would be no difficulty. We should adopt the attitude of minding our own business and letting the other fellows do the same. This brings me more or less to the statement made by the hon. member who spoke a while ago, about this government having no commitments. I have in my hand a copy of an editorial which appeared in the Ottawa Citizen of March 18, 1938, and which reads:
Canada Should Keep Out of War
There is no hint of the Canadian parliament being consulted on Canada's war liabilities before the eleventh hour, but there is every likelihood that the Minister of External Affairs, Premier Mackenzie King, is being informed from day to day by the British authorities at Whitehall. They are, doubtless, anxiously looking for guidance in the task of determining British foreign policy.
A Canadian press dispatch from London yesterday stated that the United Kingdom government is "working in close consultation with the dominion governments in an endeavour to evolve a program to meet the increasingly grave international situation." It may be taken as highly probable that this Canadian press statement is based on information from official sources in London.
The people of Canada, even the representatives of the people in parliament at Ottawa, seem to be in the dark on Canada's position with regard to the situation in Europe. The members are rarely given an opportunity to express themselves on the floor of the house. They are easily discouraged from offering any guidance.
Without being consulted, this parliament sanctioned Premier Mackenzie King's decision to substitute His Royal Highness the Duke of York for Edward VIII as King of Canada. A similar decision to indicate-or to do nothing to indicate-the extent of Canadian cooperation with the United Kingdom in an impending
[Mr. C. E. Johnston.)
European upheaval, without consulting the dominion parliament until after the event, could apparently be made without much protest on the part of members on parliament hill.
Whether or not that is true, I cannot say, but I do not think many hon. members will contend that the press is not telling the truth. If they do not tell the truth, then I take the stand I have always taken, that they should be forced to tell the truth. The evidence is that there is a close contact. When the Prime Minister (Mr. Mackenzie King) makes his statement with regard to the policy of this government, as I understand he will do in a day or two, I hope he makes clear the position of Canada. I should like him to state that this dominion will never participate in a foreign war without the consent of the people. There should be the consent of the people, not just the consent of parliament. It might be said that this parliament gave its sanction as far as Edward VIII was concerned, but that was given after the event. I hope the policy of this government will be made perfectly clear when the Prime Minister makes his statement.
I continue with the editorial:
At the same time, British statesmen seem to leave no doubt about the close cooperation of Great Britain with France. It is at this point that Canadian opinion would do well to be clear on Canada's responsibility as a member of the family of British nations.
It goes on to say:
Lord Halifax stated in the House of Lords last Wednesday that Great Britain is anxious to have the dominions as well as the people of the United Kingdom united behind any steps that may be taken to deal with the grave situation in Europe. Lord Halifax is reported as saying that British foreign policy must be conducted "so it may deserve and command support in this country of a united people, and in the dominions of a united empire."
If that statement is true, then it is manifest that Canada is going to take part, whether or not she likes it. It has been said that no commitments have been made, but apparently Great Britain has assumed that we have made commitments. Therefore, we are going to be held responsible. If this is not so, I should like the Prime Minister to make a definite statement in order to counteract the impression that has gone abroad. Apparently this is the opinion of the press and the people of Great Britain, and I think we should be very cautious. Our policy should be one of distinct neutrality. That is a very difficult road to follow. As I have stated before, I think we should have one of the best defended countries in the world, and I make no apology for making that statement. I should like to

Supply-National Defence
see the Minister of National Defence (Mr. Mackenzie) spend more money on defence, although I may tell him quite frankly that I do not like the method by which he raises the money. But I think we should follow a policy of neutrality. Let us see whether we are following such a policy or whether we are making commitments, probably innocently, but nevertheless commitments.
I have a clipping here dated London, England, March 21:
It was learned here to-day that the Chamberlain government's negotiations with Mussolini's representatives for a pact between London and Rome are nearing completion.
Italian troops were reported withdrawing from Libya as a concession to Britain.
The fact that Chamberlain is making a pact with Mussolini is greatly displeasing the public. Yesterday 20,000 people marched through the streets of London protesting such a pact and shouting: "Chamberlain must go!"
This is the part I want the committee to note:
It is understood that the pact includes provisions for a large loan to the Italian dictator, whose country is near to a financial crisis.
If that loan is negotiated, will there not be a commitment? Will not everyone who subscribes to the loan be more or less involved in the outcome? I say that you are automatically committing yourself there, whether you like it or not.
We had a good many statements not long ago about a boycott; but the very fact that you boycott a nation means that you are taking sides. There again you are definitely committing yourself, whether you like it or not. Some persons suggested that we should send munitions to the loyalists in Spain to even things up. That may be all right, but as soon as you do that you are making commitments. That is not leading to the road of neutrality. You must be consistent. If you are going to keep out of these troubles, you must keep out of them entirely, and let these other nations work out their own affairs. All these things tend to develop a public opinion; whether intentionally or unintentionally is not the point; the fact is that they do develop public opinion.
There is one other thing which makes it exceedingly difficult for us to stay neutral, and that is the exportation of arms and munitions from this country. I hold in my hand sessional paper No. 204, which I asked for in the house some time ago. It shows the number of permits issued and the value of our exports of arms and ammunition. This was the answer that was brought down:
196 permits were issued from July 31, 1937, to date-
That would be about nine months:
-for the exportation of arms, ammunition, implements or munitions of war.
That is an average of twenty-four permits a month. How can we stay neutral under those circumstances?


An hon. MEMBER:: Why can't we?


Charles Edward Johnston: I will show you in a moment why not. Permits were issued to the number of thirty-four for the export of a total value of arms and ammunition to the United Kingdom of $233595.83; to Australia, the total value of the shipments was $11,052.03, and the number of permits issued, twenty; Newfoundland, total value of shipments, $5,316.19, and fifteen permits issued; New Guinea, total value of shipments, $2,890, and one permit issued; New Zealand, total value of shipments, S5,000, and one permit 'issued; Trinidad, total value, $9.98, and one permit issued; the Argentine, total value, $90,336, and five permits issued; Brazil, total value, $550, and one permit issued; China, total value, $210500, and thirty-five permits issued. We have shipped directly to China, a nation at war, arms and ammunition to help that country. Is that neutrality? I cannot conceive that to be neutrality because you are definitely taking sides. To the Dominican Republic we shipped arms and ammunition to a total value of $16,168, and one permit issued; Japan, total value of shipments, $43,500, and two permits issued. We shipped that amount of war materials to Japan. We are supplying both China and Japan with munitions. Is that taking the road to neutrality? Surely that is not a neutral stand we are taking. I think it is one of the most definite commitments we could make, and yet we are endeavouring to take a neutral stand. To Nicaragua we shipped arms and ammunition to a total value of $40,600, and two permits issued; Norway, total value of shipments $84, and one permit issued; Turkey, total value of shipments, $266,892.20, and three permits issued. To the United States, which is one of the best equipped nations in the world to manufacture arms and munitions of war, we shipped $59,134.46 worth of arms and ammunition, and sixty-nine permits were issued. I wonder where those munitions went after they were shipped to the United States. No doubt they went to Italy, China, Japan, or some other of the warring nations. Altogether we shipped arms and munitions to a total value of $1,051,781.69, and the total number of permits issued was 196. Those were munitions all ready for use; the figures do not include raw materials.
2S80
Supply-National Dejence

I have in my hand, another return, which I shall not read in detail, but it shows the amount of scrap iron or steel, aluminum scrap, brass scrap, nickel and copper that we shipped out of this country between 1935 and 1937. Let me give the figures for nickel. In 1935 we shipped out of this country 1,427,265 hundredweight of nickel, of a total value of $36,285,482; in 1936, 1,736,375 hundredweight, of a total value of $44,594,296; in 1937, 2,227,700 hundredweight, of a total value of $58,913,217. And we are taking a neutral stand! Think of the tremendous amount of war material we have shipped to these warring countries, and yet we are endeavouring to be neutral! We say we have made no commitments. It seems to me that our commitments could not be greater or more offensive to other nations than the very ones we have made in this way.
Here is another article headed, ''Canadian delegate states Canada is arsenal of Japan." It reads in part:
On Saturday the Canadian delegate declared that "Canada is the arsenal of Japan; but for war materials from Canada it would have been impossible for Japan to begin her aggression and impossible for her to continue it."
Addressing 900 delegates from 19 countries, Mr. MacLeod declared that in 1936 Canada supplied Japan with 71-7 per cent of its aluminum for aircraft; 79-11 per cent of her copper and, directly or indirectly, 100 per cent of her nickel.
"Any movement against Japanese aggression which does not lead to a government embargo on shipments of war material," he said, "would be absolutely meaningless."
I stated last year that I thought it was the government's duty to declare an embargo on shipments of war material, and I still think that is the proper course for it to take. Last year, when speaking on this question, the Prime Minister informed me that an investigation was being made into the manufacture of munitions to find out if any profiteering was going on. I have not heard of any report being made on that investigation. I think it was the proper course to inquire into the matter, and I think the report should be made public if there was an investigation, so that the public would know whether there was any profiteering or not in that industry. I have never contended that our manufacturers should make munitions for nothing; I think they should have a reasonable commission, and no one, I think, would contend to the contrary; but when it comes to profiteering I think that is wrong. When we ship arms and munitions to countries that are openly engaged in war, I think it is absolutely wrong and is leading us right into war, and I believe we should

declare our policy most emphatically when the Prime Minister is making his statement on foreign policy.
I have no objection to defence; I believe we should be properly defended, and I think the suggestion made by an hon. member a short while ago in regard to the defence of our coasts is sound. He is an army man and knows better than some of the rest of us do what the requirements are, and no doubt the minister will avail himself of the information which that hon. gentleman has given. I would suggest, however, that defence divides itself into two parts. In the first place, provision must be made for weapons-airplanes, machine guns and things of that sort. And let me say that, if the need arises, we can build those things right here in Canada. For that matter, we could start now. We have an admirable beginning in our aircraft. But one of the greatest forms of defence, one form that we are neglecting, the one most essential, is the proper care of our people, because when war is declared you must have healthy men to fight. And how will you have healthy men unless you pay attention to them now? You will not have good, healthy men in the ranks of the unemployed if you leave them poorly clad and housed and ill fed. One of the main considerations of the government should be to see that our people are properly cared for. That was what they promised in 1935, and that is what they should be giving their attention to at the present time.
But the question will be asked, Where is the money to come from? I said a moment ago that I did not agree with the government's plan of raising money for defence. Let me repeat, I have no objection to defence, but I must vote against this estimate for the same reason that I gave last year: I object to the method by which the money is to be raised. The Prime Minister in 1935 said that he would issue money in terms of public need. Surely there is no greater public need than the defence of the country. And there is no greater need in times of peace than the proper care of the citizens of the country. If the Prime Minister would put that promise into effect, I would have no objection to this estimate. If he would issue debt-free money to take care of defence, instead of piling up the national debt by increasing taxation; if he would devise a plan of that sort and issue money in terms of public need, debt free, then there would not be anyone who would vote against these estimates. We must have more money if we are to have defence; and where will it come

Supply-National Defence
!S81
from? The Minister of Labour on March 2, as reported at page 979 of Hansard, made a statement from which I wish to quote:
.	.	. but the dominion government can appeal to no one for grants in aid. In connection with its increased expenditures it can go only to the taxpayers of this country. That is a consideration which we are bound to keep in view.
That, it seems, is where the money is to come from. Further on, he said:
I think it is quite clear from the returns made by the income tax branch of the Department of National Revenue that it would be quite impossible to raise this additional sum by increasing the taxes imposed on the higher brackets of income.
Rest assured it will not come from the higher brackets.
No doubt some additional income could be obtained in that way-so far as I am concerned I would prefer that it be done in that manner- but there is no doubt that if we endeavoured to obtain this revenue it would be necessary to go into the lower brackets of income where we would be taxing once more the small home owners who have already been seriously affected by the heavy burden of relief in our municipalities.
If we have to build up a defence force by means of money obtained from that source, then I say that we are destroying the greatest arm of defence that we have-the health and well-being of our citizens who must necessarily participate in any war of defence. On the next page the minister is reported as follows:
If we did not have recourse to the income tax to raise the money required by the dominion government taking over the entire cost of relief, we would have to consider the sales tax. I think it will be agreed that here again we would be burdening that group of moderate wage earners who represent, so to speak, the working force of the country as a whole. Not only that, but with an increase in the sales tax we would be providing another deterrent to a revival of the building industry.
It is clear from the foregoing exactly how the government intends to get the money to build up a defence force. Perhaps, however, I am wrong, because the Minister of National Defence did say that he would issue $500,000,000. I hope he will persuade the government to do this. If he does, I can assure him that I shall vote for this estimate. I hope that he will carry out that promise which he made in the west.


Frederick George Sanderson: I regret to have to interrupt the hon. member, but he has exhausted his time.


Charles Edward Johnston: I am just about through. I want to assure the minister
that if he keeps the promise which he made in Edmonton, of issuing $500,000,000 of debt-free money, I shall vote for these estimates, and not otherwise.


Frederick George Sanderson: Shall the item carry?


Ian Alistair Mackenzie: We will let it stand.
Item stands.
General-Closing relief projects, $2,000.
.Mr. STIRLING: Are they all closed?


Ian Alistair Mackenzie: Yes. This is a small sum for unforeseen contingencies and to meet claims for compensation for men who formerly worked in the camps.


Grote Stirling: What has happened to the physical properties of the various camps throughout Canada?


Ian Alistair Mackenzie: I understand they have been disposed of, through the salvage officer, to the provincial governments relief organizations, and, in some instances, for public use, and so forth.


Mr. GRAYDON:: I wish to remind the minister of a situation I brought to his attention once before, namely with regard to the Long Branch rifle ranges situated near Lake-view in the county of Peel. During the last month or so, some dismantling operations have been under way in connection with the buildings which were occupied as relief camps in the years gone by. During the dismantling process, a number of men were employed. I absolve the minister of any serious criticism with regard to the actual employment of these men who were obtained to do the job; but I would point out to him that a number of complaints have reached me as federal member for the district, and I believe a number of complaints have reached some other members of the house from interested parties who were seriously seeking employment for unemployed returned soldiers at that point. Some time ago I had an undertaking from the Minister of National Defence that he would look into the complaints, which to a large extent had to do with the fact that a number of men who were employed in this dismantling process were not overseas veterans. I know the minister has a keen interest in veterans' problems, and as far as humanly possible I have no doubt he will see that returned soldiers have a proper place in this employment scheme. I am sure he will be glad to accede to my request that something be done in the matter. I am not in a position
Supply-National Dejence

to make a personal statement in regard to this; I only repeat to the minister complaints which have arisen from time to time that those who were employed on this Long Branch dismantling project found it necessary to seek advice and guidance as to employment from the president of the local Liberal association. I do not want especially to criticize the president of the local Liberal association. I know him very well. But I do severely criticize the system. I know I need only draw the matter once more to the attention of the minister for him to see that some different system is put into effect regarding employment on that kind of work. I would welcome at this stage some statement from the minister to the effect that the matter has been satisfactorily dealt with and that no more ground for complaint will be given.


Ian Alistair Mackenzie: On April 6 on the orders of the day my hon. friend asked a question with reference to the situation, and instructions were given on April 19 that in the event of the remaining huts being dismantled, as many exrservice men as possible were to be employed. At the time the question was asked there was available only a sum of S250 for this work. At that time six men were working, of whom two were returned soldiers and four were not. Subsequently to that date a further amount of, I think, $1,600 was made available for the dismantling of the rest of the huts, and I understand that since then ten men have been taken on of whom four are returned soldiers. The instructions from headquarters are, and certainly the desire is, to employ as many ex-service men as possible on all projects connected with defence. We have in all our contracts a clause to that effect, and on some of our projects the personnel is 100 per cent ex-service men.


Gordon Graydon: It is encouraging to know that this is the view held by the minister in his department. What has been happening has evidently been entirely contrary to the minister's instructions. I hope he will see that from now on his wishes and the instructions of the department shall prevail in this matter.


Ian Alistair Mackenzie: I shall be glad to do so.


[Stage Direction]
Item agreed to.
Battlefields memorials, $40,000.
Mr. MacNEIL:: What work is contemplated under this vote?


Ian Alistair Mackenzie: The
break-down of the vote will give it:
Temporary employees, of whom there
are two	$ 2,200
Wages	 4,300
Total salaries and wages	$ 6,500
Pay and allowances of one officer.. ..	9,315
Stores and equipment	 1,800
Construction of buildings and works. .	500
Operating expenses of properties.. ..	10,600
Repair and upkeep of buildings and
works	 5,885
Transport and travelling of personnel	150
Sundries	 5,250

Last year's vote was $51,340, but in last year's vote, or in the vote of the year prior to that, my hon. friend will understand that there were many expenses in connection with the unveiling of the Vimy memorial.


Charles Grant MacNeil: Who is the officer to whom reference is made?


Ian Alistair Mackenzie: Major
Simson, who is in residence in the neighbourhood of the Vimy memorial, in the city of Arras.


James Shaver Woodsworth: I want to make an observation which I hope, will not be considered too irrelevant. A returned man wearing a button, stopped me to-day within a block of this building, said that he was out of work and that he had not the privilege of going to the shelter, and asked the price of a meal. He said that what he wanted most was work. I had no opportunity of checking that particular case; but unfortunately I have been approached by scores of men like that right here in Ottawa, and I know personally large numbers of returned men who are definitely in need of relief. It seems to me that while we are erecting monuments in marble, we ought to give adequate attention to the poor fellows here in Canada who are out of jobs and are living on charity. I make my protest against the large sums that are being used, some of them overseas, for memorials which may be of interest to an occasional tourist, while we are giving such inadequate support to a great many of our Canadian citizens here at home.


Howard Charles Green: Are these battlefield
memorials all in France? Will the minister tell us which ones they are, and also how large a staff we have looking after them?


Ian Alistair Mackenzie: They are at Passchendaele, St. Julien. Hill 62-Mount Sore!, Vimy Ridge, Dury, Bourlon Wood, le Quesnel in front of Amiens, and Courcelette. The staff comprises one officer and three employees, employed continuously.



193S

[Stage Direction]
Supply-National Defence
2S83
Mr. HAYHURST:: In the details on page 140, what does, the item, "pay and allowances, S9,315," cover?


Ian Alistair Mackenzie: This item provides for the pay and allowances of Major D. C. U. Simson, engineer in charge, and a contingency amount to provide for loss on exchange.


Howard Charles Green: Is there a temporary staff too?


Ian Alistair Mackenzie: There may be casual employees from time to time to look after the grounds, say in summer.


Howard Charles Green: In the details on page 140, there is an item, "operating expenses of properties, $10,600." For what is that money spent?


Ian Alistair Mackenzie: This is to provide for the maintenance of the Vimy memorial site and seven other battlefield memorial sites in France and Belgium. The increase in this item this year is on account of the cost of maintaining the Vimy site. Certain small improvements had to be made to the site itself after the unveiling of the memorial.


Grote Stirling: I suppose the work on the fortifications at Quebec, for instance, does not come under this item?


Ian Alistair Mackenzie: No; this is entirely for overseas memorials.


Grote Stirling: Under what item would that work at Quebec come, if there is any going on now?


Ian Alistair Mackenzie: The
national battlefields commission, I am informed, which I think is under the administration of my colleague the Minister of Finance. The battlefields near Quebec are not under the Department of National Defence, but I think certain work on the citadel and walks has been done from time to time under the direction of the department and under another vote.


Grote Stirling: Some admirable work was done under the relief scheme, some walls taken down which were in jeopardy, and rebuilt from the base up; and I think after that time some further work was done.


Ian Alistair Mackenzie: We did some last year.


Grote Stirling: But there is none going on now?


Ian Alistair Mackenzie: Not just at tho present time, I am informed.


[Stage Direction]
Item agreed to.
Adjustment of war claims, including grant of $300 to McGill university toward upkeep of war museum, $64,000.
Howard Charles Green: Would the minister explain this vote?


Ian Alistair Mackenzie: This is for the payment of expenses and services arising as a result of the great war, including claims for adjustment of pay and allowances, separation allowances, war service gratuities, headstones on graves in Canada of ex-members of his majesty's forces, war medals and decorations, the compilation of the official history of the Canadian forces in the great war and other historical information, and miscellaneous expenses attributable to the great war.


Charles Grant MacNeil: What progress has been made ip publishing the historical record of the Canadian corps?


Ian Alistair Mackenzie: The first copies should go to the press for review almost immediately. As a matter of fact, I have the advance copy in my possession now, and I think it will be released within the next few days. This memorandum was prepared some time ago, but according to it the text volume has been run off and awaits the index before binding can be carried out. The appendix volume has been run off. It is estimated that copies of both text and appendix volumes, sufficient for circulation to the press, will be ready between the 9th and 16th of May, which is three or four days from now, and for public sale two weeks later.


Charles Grant MacNeil: How will these be made available for circulation? Will they be placed in the libraries of the country?


Ian Alistair Mackenzie: I understand they are to be placed in the libraries and also sold through the king's printer. Copies will be made available to members of the house, as was done formerly.


Grote Stirling: Of the first volume?


Ian Alistair Mackenzie: Two
volumes; the first volume, with the maps and appendices which are correlated with the incidents described in the first volume, up to 1915.


Grote Stirling: And with regard to the second volume, has the minister any information?


Ian Alistair Mackenzie: I cannot give any definite information as to the date of completion of the second volume.
2S84

Supply-Defence-Radio Services


Charles Grant MacNeil: May I ask if any provision exists for the adjustment of claims in respect of working pay overseas or in respect of repatriation expenses?


Ian Alistair Mackenzie: That question has been very strongly brought to the attention of the department quite recently by the national headquarters of the Canadian Legion and also by representations made by certain hon. members through questions asked on the floor of the house. So far as I can gather it at the moment, the situation is that without question promises were made by regimental officers in regard to working pay for certain members of the Canadian corps, but a general order was issued later, abolishing working pay in the Canadian forces. The unfortunate situation is that many of those men, particularly those who served with the 3rd Canadian tunnelling company, believe that they are entitled to working pay. The official viewpoint is that there was no official authorization for such working pay, so it is a matter of controversy and really there has been no final settlement up to the present time.


Charles Grant MacNeil: Would the minister also deal with the question of repatriation expenses, in connection with men who returned to Canada after service at their own expense? Under an old arrangement they were, I think, entitled to something.


Ian Alistair Mackenzie: So far as I know, there are no representations in this regard before the department at the present time.


[Stage Direction]
Item agreed to.
Radio services, Northwest Territories and Yukon radio system, $358,050.
Grote Stirling: Would the minister give
us a general outline of what is involved under this item?


Ian Alistair Mackenzie: First,
I shall break down the vote: Salaries, civilian personnel, twelve temporary employees, $13,450; pay and allowances of officers and other ranks, eight officers, $23,322; other ranks, eighty-two, $136,478. Total pay and allowances, $159,800. Stores and equipment, $102,S00; construction of buildings and works, including the purchase of land, $30,500; operating expenses of properties, $11,350; repair and upkeep of buildings and works, $11,150; transport and travelling (personnel), $15,750; freight, express and cartage, $4,500; printing and stationery, $2,350; medical and dental services, $2,150; telephones, telegrams and postage, $1,200; sundries, $3,050. This makes a total of $358,050.


Howard Charles Green: What is the provision for
medical and dental services? Is that for the men employed?


Ian Alistair Mackenzie: This
provides for medical and dental services for the military personnel, and the small increase of $150 is on account of an increase in the personnel this year.


Grote Stirling: Where are the stations
located?


Ian Alistair Mackenzie: First
of all, there is Headquarters, Barriefield depot. The stations are at Dawson City, Mayo, Edmonton, Fort Smith, Fort Resolution, Fort Simpson, Fort Norman, Aklavik- Herschel, Cameron Bay, Fort McMurray, Chippewyan, Yellowknife, Goldfields, Outpost Island, North Battleford, White Horse, Gordon Lake and Burwash Landing.


Grote Stirling: To what extent do these stations assist in commercial or emergency work?


Ian Alistair Mackenzie: This,
of course, is under the control of the Royal Canadian Corps of Signals. The system serves to link up the Northwest Territories and Yukon with the communication systems of the rest of Canada. Transfer points to commercial telegraph systems are maintained at the following points:	Dawson
City, Fort McMurray, Edmonton and North Battleford. This system also links with the Royal Canadian Signals (permanent force) radio system, which has stations at Ottawa, Kingston, Toronto, Winnipeg and Calgary. Communication is also maintained by radio with the Washington-Alaska military cable and telegraph system, steamers in arctic waters, Department of Transport stations and stations in the Northwest Territories belonging to private companies. The system transmits daily press bulletins from Edmonton to all stations in the Northwest Territories and Yukon. In addition, aircraft weather reports are provided free of charge at frequent intervals, or as required, to all who desire them. Arrivals and departures of aircraft and steamers and similar vital services are provided at nominal cost. Traffic and weather reports for all departments of the dominion government are handled free of charge. Departments and services making use of this service include the Royal Canadian Mounted Police, Department of Transport, Department of Mines and Resources, Post Office Department (in connection with air services), the Royal Canadian Air Force, etc.


Harry James Barber: The estimate for transport and travelling is almost double. Is that mainly by air?

Supply-Defence-Militia Services


Ian Alistair Mackenzie: This
provides for the transport and travelling expenses incident to inspections, original appointments and enlistments, retirements, transfers between stations and other travelling expenses. The increase of 87,800 is chiefly to enable personnel at the northern stations to be relieved more frequently. Many noncommissioned officers spend four to five years without relief, whereas three years is considered the normal period of time that should be spent.


Harry James Barber: Is the travel mainly by air?


Ian Alistair Mackenzie: In some instances it would be by air, but not necessarily.


Mr. WOODS WORTH:: Would the minister explain how this system is correlated with that under the Department of Transport?


Ian Alistair Mackenzie: There was some suggestion made a year ago that there might be overlapping as between the radio service established by the Royal Canadian Corps of Signals and that under the Department of Transport. An interdepartmental committee was set up which made a thorough investigation, and I have here the report, pointing out that the operation of this system by military personnel has distinct advantages from a defence standpoint; that certain types of training are given to Royal Canadian Corps of Signals men which cannot be given by the department in any other way. A continuation of the operation of this system is of tremendous value to this department from many angles. It is agreed that the system could be operated for less money per annum. It is not agreed that it could be more economically operated. If the Royal Canadian Signals did not get the training they now obtain in this way, more men would be required in the corps paid for from the permanent force vote in order to ensure that an adequate number were trained. Other training arrangements would have to be devised to compensate for the training these men now get, and altogether the ultimate cost to the taxpayer from a broad point of view would be greater than at present. The finding actually was that there was very little duplication as between the Royal Canadian Corps of Signals and the Department of Transport. This question was brought to our attention less than a year ago.


Grote Stirling: Is there any international use of this service? Does the United States request our assistance on occasion?


Ian Alistair Mackenzie: In Alaska, and within the last few days we have had
official thanks from the Russian ministry in Washington, I believe it was, thanking the Canadian government for the use of the services of the signal corps in the search for the lost airmen.


[Stage Direction]
Item agreed to.
Militia services-Grants to military associations and institutes in the amounts detailed in the estimates, $103,450.
Charles Grant MacNeil: Would the minister give us the information on this vote?


Ian Alistair Mackenzie: The details show that there are the rifle associations of Ontario, Quebec, Nova Scotia, New Brunswick, Prince Edward Island, Manitoba, British Columbia, Alberta, Saskatchewan, the Dominion of Canada Rifle Association, the National Defence headquarters and the university and local.
Then, there are various service associations. May I point out that the vote last year was not in this form, although a sum of money was included in another vote. The service associations are listed as cavalry; artillery; engineers; signals; infantry, machine gun and tanks; army service corps; army medical corps, and a small contribution of 8500 for the magazine known as the Defence Quarterly. Under the headings of military institutes we find the Canadian, of Toronto; the Western, at Winnipeg; the Alberta, at Calgary; the United Service Institute, Vancouver; the United Service Institute, Regina; the Royal Military College Club of Canada; the United Service Institute of Saskatoon; the Institute of Nova Scotia, Halifax; the United Service Institute, Vancouver Island, Victoria; the United Service Institute, Ottawa; the United Service Institute, Quebec; the United Service Institute, Moose Jaw; the New Brunswick Institute, Saint John; the Military Institute, London; the Military Institute, Edmonton; the Military Institute, Kingston; the Military Institute, Charlottetown, and the United Service Institute, Montreal.


Charles Grant MacNeil: Who are eligible for
membership in the rifle associations? Must they ibe members of the militia?


Ian Alistair Mackenzie: Yes, of the military associations; for these grants they must be members of the militia. I understand in other days there were grants made to civilian rifle associations, but they were discontinued some time ago.


Charles Grant MacNeil: What are the responsibilities of rifle associations? There was some question in previous sessions as to the right of the district officer commanding to call upon rifle



Supply-Defence-Militia Services
associations in cases of emergency. What exactly is the jurisdiction of the district officer commanding? What responsibilities must be accepted by members of rifle associations?


Ian Alistair Mackenzie: I would say none at all, in their civilian capacity, but I shall look into the question. If they were members of the militia, there would be jurisdiction.


Charles Grant MacNeil: I would remind the minister that a general order which appeared showed that rifle association members were liable for service under orders of the district officer commanding, in the event of emergency, and particularly in the event of civil disturbances.


Ian Alistair Mackenzie: I am not sure of it, but I should like to have the order pointed out.


James Shaver Woodsworth: Is there any regulation as to how this money shall be spent by the different associations, or are they allowec carte blanche?


Ian Alistair Mackenzie: In regard to the financial aspect of the question, they are under obligation to submit an audited report to the department. With reference to the general aspect of the question, I think they are allowed very wide jurisdiction with respect to the exact manner. Generally speaking, moneys for service organizations, for instance, are spent for meetings and conventions for the discussion of problems concerning their own particular arms of the service. In connection with the rifle associations, there are, of course, organizations in each province, and then each year we have an annual meeting here in Ottawa at the Connaught range in charge of the Dominion of Canada Rifle Association. Then, there is the final stage when the Bisley team is selected by the Dominion of Canada Rifle Association and sent to England each year to compete with other members of empire teams. With reference to general expenditure, I may say that they have very wide jurisdiction and are subject to audit every year.


Angus MacInnis: How many associations are there in British Columbia?


Ian Alistair Mackenzie: The only one named getting a grant in British Columbia is the provincial organization. The British Columbia Rifle Association gets a grant of $1,500 a year.


Angus MacInnis: Has the minister any information as to the membership of the association?


Ian Alistair Mackenzie: I have not the details here, but I shall get them for the hon. member. They might also be in their annual report, but I am not sure.


Howard Charles Green: Does membership in these associations include members of the militia, or do militiamen obtain their training in rifle shooting separately?


Ian Alistair Mackenzie: Militiamen obtain training in their own units, of course; but very often that is supplemented by membership in rifle associations, especially if they are expert shots.


Howard Charles Green: Is it the intention that
these rifle associations shall train men to shoot who are not in the militia?'


Ian Alistair Mackenzie: May I
answer the question by referring to some information I have before me. These grants are made annually to permit and encourage rifle shooting, and to assist associations in defraying expenses connected with the annual prize meetings. Rifle associations are classified under three headings, namely the Dominion of Canada Rifle Associations, the provincial rifle associations and, in reply to the hon. member for Vancouver East, university and local rifle associations. If the hon. member wishes to have the information, I can describe the various associations.


Mr. COLD WELL:: How many associations of each type are there?
Mr. MACKENZIE (Vancouver:) I have before me a statement by military districts, showing the number and the state of military and civil rifle associations, giving the numbers in each group, as of February, 1938. I shall place the table on record:
Military	Military	Civilian	District	Active	Inactive	Active	InactiveNo. 1.. .	. 4	5	1	No. 2.. .	. 24	12	2	No. 3.. .	. 15	3	4	'2No. 4.. .	. 15	5	No. 5.. .	. 9	5	'6	'2No. 6.. .	. 23	5	3No. 7.. .	. 8	2	'2	2No. 10.. .	. 8	4	7	No. 11. . .	. 14	2	3	No. 12.. .	. 22	4	2	'2No. 13.. .	. 10	5	I would	point	out that	military	district
No. 11 is the British Columbia district.


Major James William Coldwell: Are there not other
types of associations than rifle associations?


Ian Alistair Mackenzie: Yes;
there are the military institutes and the various service associations.


William Hayhurst: What kind of rifle is
used in these rifle associations?
2S87

Supply-Defence-Militia Services


Ian Alistair Mackenzie: The Lee-Enfield rifle.


Leslie Gordon Bell: What is the totai membership in these organizations?


Frederick George Sanderson: The hon. member for
Royal has the floor.


Alfred Johnson Brooks: Has the minister ever received any requests from military organizations in Canada that these associations be confined entirely to active militia, and that there should not be the civilian element? I have asked the question because I have heard representations made that these civilian organizations were practically useless, so far as any benefit to the country was concerned. The men who belong to these civilian rifle associations look upon it as a sport, as other people would consider golf and so on, and yet the country is paying for it. Have any representations been made along that line?


Ian Alistair Mackenzie: No representations have been made in the last two and one half years that I know of.


Alfred Johnson Brooks: Were any made prior to that?


Ian Alistair Mackenzie: The
grants to civilian rifle associations were discontinued in November, 1934, as it was felt that the value obtained did not justify the expenditure involved.


Alfred Johnson Brooks: Then there are no civilian rifle associations?


Ian Alistair Mackenzie: Not receiving grants of monty?


Mr. LENNARD:: Do these rifle associations devote any of their activities to machine gun instruction?


Ian Alistair Mackenzie: I do not think so generally.


Frank Exton Lennard: In my opinion these rifle associations are becoming antiquated. The majority of those who attend the meetings are styled more or less as pot-hunters. I think it is about time we curtailed that sort of thing and got down to business. We should devote more time to teaching the modern branches of the service.


Paul Joseph James Martin: Of the slaughter.


Ian Alistair Mackenzie: The point raised by the hnn. member has occasioned many debates in these associations; but the general opinion is that despite the development of the automatic, the rifle and the sharpshooter constitute an essential factor.
51952-183}


Grote Stirling: In each case the grant is made to a provincial association?


Ian Alistair Mackenzie: Yes, to those named.


Grote Stirling: Then there are member associations in different parts of each province?


Ian Alistair Mackenzie: That is right.


Grote Stirling: Is there any felation between the amount of the grant and the number of associations that operate under the provincial association?


Ian Alistair Mackenzie: I am not exactly familiar with the basis upon which the grants are computed, but there has been no change for many years.


Charles Grant MacNeil: What is the purpose of the grant to the military institutes?


Ian Alistair Mackenzie: They are similar to the grants made to the service associations. Discussions of various kinds are held in connection with defence, military tactics and so on. These grants have been given for a great number of years. This is the first year in which they have been shown, in a separate vote; they are more obvious-than they were in former years.


Charles Grant MacNeil: Who comprise the membership of the institute?


Ian Alistair Mackenzie: Active and reserve officers of the permanent and nonpermanent forces would be eligible.


Alfred Johnson Brooks: Are there any non-commissioned officers?


Ian Alistair Mackenzie: I do not think so.


Howard Charles Green: The bulk of the vote for the rifle associations goes to the dominion association?


Ian Alistair Mackenzie: Yes.


Howard Charles Green: What is that grant used for?


Ian Alistair Mackenzie: They are the main controlling body of rifle shooting in Canada. They correlate the activities of the provincial organizations and take charge of the annual shoot at the Connaught ranges. They select the Bisley team, following the results of competitions in the provinces and the annual one here in Ottawa.


Howard Charles Green: Does this item include the cost of sending the Bisley team to England?
2888	COMMONS
Supply-Defence-Royal Military College


Ian Alistair Mackenzie: There is an item in another vote to cover the expenses of the adjutant or the commandant of the Bisley team. They have jurisdiction over the manner of expending the grant and spend some of this money in connection with the Bisley team.


[Stage Direction]
Item agreed to.
Royal Military College, $381,500.
Mr. gTIRLING: There were some additional buildings at Kingston brought into use last year.
Ian Alistair Mackenzie: There
is a new dormitory wing.


Major James William Coldwell: How many students are there in the college?


Ian Alistair Mackenzie: The regulations call for not more than 200. If that number is to be exceeded, a special order in council is required.


Major James William Coldwell: What is the size of the staff?


Ian Alistair Mackenzie: Civilian personnel, permanent, fifty-six, temporary, twenty, officers, seventeen, and other ranks, sixty-two.


Charles Grant MacNeil: How many gentlemen cadets graduated at the last term according to provinces? What is the method of selection for entrance to the college?


Ian Alistair Mackenzie: The number of graduates for the last several years are


Ian Alistair Mackenzie: Generally speaking, it is the level of junior matriculation throughout Canada. Of course, it is not called that in some provinces, but that is the standard.


Angus MacInnis: The hon. member for Vancouver North (Mr. MacNeil) used the term "gentleman cadet." Are all the students gentlemen cadets, or are there some cadets and some gentlemen cadets?


Ian Alistair Mackenzie: They are all cadets and they are all gentlemen.


Major James William Coldwell: The minister stated there was a permanent staff of fifty-six. How many of those are actually engaged in academic work, and what are their salaries?


Ian Alistair Mackenzie: The staff is as follows:
Professors	Salaries
Mathematics	$5,045
Modern languages	4,680
Physics and chemistry	 4,545
Civil engineering	4,545
Associate professors .
Surveying	3,780
Mathematics	3,780
Mathematics	3,330
Mathematics	3,330
Civil engineering	3,780
Physics	 3,645
French	 3,780
English and history	3,780
Instructors
Physics and chemistry	 2,820
Chemistry and French	 2,940
Engineering	2,940
French	2,850
English and French	1,920
as follows:			Civil subordinate staff, laboratory
1926-27.. ..	33	assistants1927-28.. ..	31	2 at	1928-29.. ..	34	1 at	1929-30.. ..	39	Clerk, grade 3	1930-31.. ..	40	Caretaker	1931-32.. ..	29	1932-33.. ..	38	2 senior messengers1933-34.. ..	48	1 at	1934-35.. ..	51	1 at	1935-36. . ..	25	Head steward	1936-37.. ..	38	Stationary engineer, grade 3	The method	of selection is that each	prov-	Stationary engineer, grade 1
ince is allowed a quota, and they are graded by order of merit according to performance on the basis of junior matriculation. If the provinces do not bake up their full quotas, then a general dominion list is made up in order of merit. Selection is made by a board at national headquarters here, and the vacancies are filled from that general list if there are any gaps in the quotas of the provinces.


Charles Grant MacNeil: Has the qualification for entrance been raised recently?

1 at.. Firemen 1 at. . 1 at.. Chef.. .
1,380
1,440
1,620
1,200
1,260
1,320
1,440
	 1,380
	 1.260
	 1,395
In addition, there are twenty-five cleaners ind helpers for 829,025, with all salaries totalling $110,405.


Alfred Johnson Brooks: I notice that, in some instances, there were two or three in the
MAV 13, 1938	2889
Supply-Defence

Royal Military College
same grade. There were two mathematics teachers, for instance, and the salary seemed to be given for one.


Ian Alistair Mackenzie: There were three associate professors teaching different branches of mathematics.


William Hayhurst: Are mathematics and chemistry practically the same as the academic subjects taught at a university?


Ian Alistair Mackenzie: Yes,
except that engineering, geometry, mathematics and physics are very much emphasized in the curricula of the Royal Military College.


Alan Webster Neill: Do the particulars given include the military officers?


Ian Alistair Mackenzie: Does my hon. friend want the names of the officers?


Alan Webster Neill: No. I was wondering how many officers there were and what they received.


Ian Alistair Mackenzie: There are seventeen officers and sixty-two other ranks.


Howard Charles Green: I take it that the reason Canada maintains the Royal Military College is to train officers for our defence forces. What happens to these cadets when they graduate?


Ian Alistair Mackenzie: The
number of graduates taking commissions in the Canadian permanent force and the Royal Canadian Air Force, and in the imperial and Indian armies are as follows:
Number of Graduates taking Commissions
	In Canadian permanent	In Imperial
Year	force and	and Indian
	R.G.A.F.	armies
1926-27..	.... 2	4
1927-28. .	.... 9	
1928-29..	.... 4	
1929-30. .	.... 8	i1930-31. .	.... 9	31931-32. .	.. .. 3	21932-33. .	.... 16	21933-34. .	.. .. 14	31934-35. .	.. .. 21	41935-36..	.... 6	51936-37. .	.... 8	6


Howard Charles Green: Would the		minister give
the totals	of those going into	the imperial
forces and	into the Canadian permanent	
force, and	the total number of graduates in	
the ten years?


Ian Alistair Mackenzie: I have already given the number of graduates taking commissions in the Canadian permanent force, the Royal Canadian Air Force, and in the
imperial and Indian armies. The percentage of graduates taking commissions is as follows:
Percentage of graduates taking commissions
1926-	27	
181927-	28	
291928-	29	
121929-	30	
231930-	31	
301931-	32	
171932-	33	
471933-	34	
351934-	35	
491935-	36	
441936-	37	
37


Howard Charles Green: Is there any regulation providing that the other graduates must go into the non-permanent militia?


Ian Alistair Mackenzie: Yes, that is the undertaking.


Howard Charles Green: All other graduates take commissions in the non-permanent militia?


Ian Alistair Mackenzie: Yes.


William Hayhurst: Are the graduates from the Royal Military College given credits at a university for the subjects in which they have graduated? Does the work they have done at the college count at a university towards an academic degree?


Ian Alistair Mackenzie: Concessions are made by the university in regard to time and subjects, but I have not the specific concessions before me at the moment.


William Hayhurst: But their credits at the college would be accepted by the university?


Ian Alistair Mackenzie: Yes, according to what they take up.


Paul Joseph James Martin: Is it not a fact that a graduate of the Royal Military College is credited with two years at our universities, that he goes into the third year?


Ian Alistair Mackenzie: Yes.


Major James William Coldwell: There are many graduates across the country, and I should like to know what is the difference between a cadet and a gentleman cadet.


Ian Alistair Mackenzie: There is actually none, but it is an appellation by which the students go at the Royal Military College, and have done for many years.


Grote Stirling: All over the world.


Ian Alistair Mackenzie: Yes.


Alan Webster Neill: Is it necessary to have
graduated at the Royal Military College to secure a commission in the permanent force?
2890	COMMONS
Supply-Defence-Royal Military College


Ian Alistair Mackenzie: No; but they have the first chance at vacancies that may exist.


Howard Charles Green: Is any training given to the cadets to qualify them for positions in the air force? The minister has stressed the importance of the air force in our defence forces, and I think we should be training some of our air officers at the Royal Military College.


Ian Alistair Mackenzie: There
is an air officer on the staff of the college; there is a certain amount of air instruction give to such cadets as desire it, and some proceed to a commission in the air force.


Howard Charles Green: They require subsequent
training?


Ian Alistair Mackenzie: Yes; it
is ground training that is given at the college. They would then need ab initio training in the air, and then advanced training.


Howard Charles Green: Would it not be possible to train at the college those cadets who want to become air officers?


Ian Alistair Mackenzie: They
could take courses at our summer training camps, and qualify in that way. Some do.


Leslie Gordon Bell: What percentage of
these young men go into the army and what percentage into the professions and business? I understand that quite a number of the boys who go to the Royal Military College do not go into the service, but gravitate into business of various descriptions.


Ian Alistair Mackenzie: The most recent figures are as follows: The number of graduates who have taken commissions in the Canadian permanent forces, including the Royal Canadian Air Force, is 241, or 19-8 per cent of the graduate body; in the imperial and Indian armies, 234, or 19 per cent.


Leslie Gordon Bell: Those taking commissions in the Canadian permanent forces amount to 19-8 per cent?


Ian Alistair Mackenzie: Yes.


Leslie Gordon Bell: A very small percentage.
Item stands.
Progress reported.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.

Monday, May 16, 1938