[Stage Direction]
Mr. THOMAS VIEN (Outremont) presented the second report of the standing committee on railways, canals and telegraph lines, and moved that the report be concurred in.
Motion agreed to.

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

Mr. PELLETIER:: 1.	Did the government ever own any land at Sorel, Quebec, or vicinity, for use of marine branch purposes?
2.	If so, what is the acreage?
3.	When was it originally purchased?
4.	From whom, and at what price?
5.	Has it now been sold?


Mr. HOWE:: 1.	Yes; at St. Joseph de Sorel-shipyard.
2.	Shipyard-34-93 acres.
3 and 4. Sorel Shipyard:
24-10 acres-ordnance land.. 9-80 acres-McCarthy estate 1-03 acres-McCarthy estate
34-93 acres 5. Yes.
Transferred at Confederation
March 17, 1919	$ 83.807 74
September 24, 1929	 6,250 00


$ 90,057 74 HENRY DIRKS
Mr. LENNARD:: 1.	Has Henry Dirks of 1221 Main street east, Hamilton, Ontario, been employed by the federal government during the years 1936 and 1937 and the first two months of 1938?
2.	If so, in w-hat capacities?
3.	What remuneration has he received? What moneys, if any, are still to be paid to him for services rendered?


Mr. RINFRET:: 1.	Yes. Services engaged in January, 1938 (Department of National Defence).
2.	Valuator, and obtaining options on land.
3.	(a) None, (b) Not known at present.


MONTREAL POSTAL SERVICE EXAMINATIONS
Mr. MALLETTE:: 1.	How many persons entered for the examinations held in Montreal in June last for: (a) postal clerks; (b) mail porters; (c) letter carriers?
2.	How many wrote at said examinations?
3.	How many were successful?


Mr. RINFRET:: 1. (a) 2,451, (b) 3,623, (c) 3,623.
2. (a) 1,767, (b) 2,593, (c) 2,593.
3.	(a) 402, (b) 824, (c) 824.
It should be noted that one competition was held for the two classes, mail porter and letter carrier.
Questions

national employment commission


MRS. A. J. CURRIE
Mr. COLD WELL:: What salary, wages, travelling expenses or other emoluments were paid to Mrs. A. J. Currie, of Govan, Saskatchewan, for her work in connection with the unemployment commission ?


Mr. ROGERS:: Mrs. A. J. Currie as a member of the women's employment committee received:
1936-37 1937-38	Total

Living allowance.. 802 50 1,027 50 1,830 00 Travelling expenses 173 50	171 82	345 32
976 00 1,199 32 2,175 32


CANADIAN MERCHANT MARINE-SALE OF SHIPS
Mr. BENNETT:: 1.	Has the present government sold any ships of the Canadian merchant marine?
2.	If so: (a) what were the names of such ships so sold; (b) what price was actually received for each of such ships; (c) who negotiated the sale of each of such ships; (d) to whom were each of such ships actually transferred on the register?


Mr. HOWE:: 1.	Yes,
2.	(a) and (b).
Name	Sale price
Canadian Cruiser	 $50,077
Canadian Constructor		50,077
Canadian Challenger	 40,013
Canadian Highlander	 40,013
Canadian Britisher	 40,013
Canadian Leader	 40,013
Canadian Scottish	 40.013
Canadian Conqueror	 39,823
Canadian Victor	 39,823
Canadian Planter	 40,061
Canadian Planter wrecked before transfer could be made.
(c) W. R. Eakin, president, McLean, Kennedy, Limited, Montreal, agents for The Ellerman & Bucknall Steamship Company, Limited; Robert W. Reford, president, The Robert Reford Company, Limited, agents of the Commonwealth & Dominion Line; Ernest W. Foulds, Montreal, joint manager, The New Zealand Shipping Company, Limited; Honourable C. P. Fullerton, K.C., chairman, board of directors, Canadian Government Merchant Marine, Limited, for the company; Honourable C. D. Howe, Minister of Transport, for

the government, in consultation with the Minister of Finance and the Minister of Trade and Commerce.
(d) The Montreal, Australia, New Zealand Line, Limited, assignees of the steamship companies negotiating the sale.


INDLAN AFFAIRS-MR. HORACE HALCROW
Mr. PERLEY:: 1.	Is Horace Halcrow of The Pas, Manitoba, employed by the Department of Indian Affairs?
2.	If so, in what capacity, and at what salary ?


Mr. CRERAR:: L Yes, by the Indian Affairs branch.
2. Mr. Halcrow was engaged- in a temporary capacity at a salary of $225 per month (1) to investigate the possibility of developing muskrat areas in northern Saskatchewan and Manitoba, (2) to secure information likely to be of assistance to the department in promoting the general welfare of hunting and trapping Indians.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. LAPOINTE (Matapedia-Matane):: What amount has the government allotted for geological researches in each province of the dominion during the last ten years?


Thomas Alexander Crerar: Return tabled.


CANADIAN INDUSTRIES-STATISTICS
Mr. ROBICHAUD:: 1. What was the total amount of capital invested in Canadian industries (both primary and secondary) on December 31, 1937?
2.	What was: (a) the gross value; (b) the net value of industrial production during the year 1937?
3.	What percentage and money value thereof was: (a) exported; (b) sold in the home market?
4.	What percentage of the portion sold in the home market would have been dutiable if imported?
5.	What estimated average rate of duty would have been charged on such portion if imported, having regard to the rates of duty now prevailing against the countries of origin of actually imported goods of similar nature?
6.	What were: (1) The total amount of dividends and interest paid to: (a) common stockholders; (b) preferred stockholders; (c) debenture stockholders; (d) mortgagees; (e) all other capital creditors? (2) The total amount of reserve set aside for:	(a) depreciation or
capital replacement; (b) possible future losses;

Camp Hill Hospital
(c) any and all other purposes? (3) The total amount set aside for: (a) sinking or amortizing fund; (b) any and all other debt reducing purposes?
7.	What were: (1) The total number of: (a)
wage earners; (b) salaried employees? (2) The total amount paid:	(a) in wages; (b) in
salaries; (e) in gratuities or any other form of remuneration ?
(If figures for 1937 not available, please give latest figures available.)


Mr. ROBICHAUD:: 1.	What was the total amount of capital invested in the Canadian manufacturing industry on December 31, 1937?
2.	What was: (a) the gross value; (b) the net value, of its production during the year 1937?
3.	What percentage and money value thereof
was:	(a) exported; (b) sold in the home
market?
4.	What percentage of the portion sold in the home market would have been dutiable if imported?
5.	What estimated average rate of duty would have been charged on such portion if imported, having regard to the rates of duty now prevailing against the countries of origin of actually imported goods of similar nature?
6.	What were:	(1) The total amount of
dividends and interest paid to:	(a) common
stockholders; (b) preferred stockholders; (c) debenture stockholders; (d) mortgagees; (e) all other capital creditors? (2) The total amount of reserve set aside for:	(a) depreciation or
capital replacement; (b) possible future losses; (c) any and all other purposes? (3) The total amount set aside for: (a) sinking or amortization fund; (b) any and all other debt reducing purposes ?
7.	What were:	(1) The total number of:
(a)	wage earners; (b) salaried employees?
(2) The total amounts paid:	(a) in wages;
(b)	in salaries; (c) in gratuities or any and all other forms of remuneration?
(If figures for 1937 not available, please give latest figures available.)


LOANS TO PROVINCES
Mr. BENNETT:: 1.	Has the government assigned, sold, disposed of or pledged any treasury bills or other securities received from any province as security for loans or advances made to such province?
2.	Has the government by guarantee, agreement, or any other means whatsoever, undertaken or agreed, directly or indirectly, to pay or cause to be paid the whole or any part of the indebtedness of any province to a Canadian chartered bank?
3.	If so: (a) when were such undertakings or agreements made or given; (b) for what amounts; (c) what sums, if any, have actually been paid by the government?


SILVER PURCHASES AND EXPORTS
Mr. REID:: 1.	What is the total amount of silver purchased and held under the London agreement of 1933 up to the end of 1937, and (a) what was the purchase price paid in each of the years 1935, 1936, 1937?
2.	Of the amounts purchased, what amounts were obtained or purchased as newly-mined silver in Canada, and (a) from what provinces were these amounts of silver procured?
3.	What amounts of silver were exported to the United States during the years 1935, 1936, and 1937, and what price was paid for these amounts during the same years?
4.	Have any representations been made by the government of the United States in connection with the continuance by Canada of the purchases of silver along the lines outlined in the London agreement of 1933, or on matters in connection with the future policy of the United States government in regard to silver?


SEED GRAIN
[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Finance) moved that the house go into committee at the next sitting to consider the following proposed resolution:
That it is expedient to introduce a measure to authorize the guarantee by the government of Canada of principal and interest of loans made by chartered banks and guaranteed by the provinces of Alberta and Saskatchewan, respectively, for the purchase of seed grain and for providing other assistance to farmers in connection with seeding operations during the spring of 1938; the liability of the government of Canada in respect of such guarantees not to exceed in the aggregate the sum of $1,900,000 in respect of Alberta and $14,500,000 in respect of Saskatchewan.
He said: His Excellency the Governor General, having been made acquainted with the subject matter of this resolution, recommends it to the favourable consideration of the house.
Motion agreed to.


[Stage Direction]
On the orders of the day:
Mr. R. E. FINN (Halifax):: I desire to call the attention of the government, particularly of the Minister of Pensions and National Health (Mr. Power) to a serious situation
Camp Hill Hospital

which has arisen in Halifax in connection with the Camp Hill hospital. I regret to say that a warning I gave a year ago was disregarded-


Some hon. MEMBERS:: Order.


Mr. SPEAKER:: The hon. member is in order in putting a question to any minister, but I do not think he is in order in making a speech, giving special reasons for the question he intends to put,


Robert Emmett Finn: I am not making a speech.


Mr. SPENCE:: Make your speech short.


Robert Emmett Finn: I will dispense with it. The question I should like to ask is why an East Indian seaman stricken with smallpox was admitted to Camp Hill hospital, which is supposed to be devoted to returned men and women, so that an orderly who was in attendance on this patient also has been stricken with smallpox, and according to a letter just received it is feared that there may be an epidemic. The hospital is quarantined so that no person may enter or leave.


Some hon. MEMBERS:: Order.


Robert Emmett Finn: I may not be quite within the rules of this house in making this explanation, but I think the matter is sufficiently serious to permit some little latitude being given.


Hon. C. G. POWER (Minister of Pensions and National Health):: Mr. Speaker, the other hon. member for Halifax (Mr. Isnor) was kind enough to give me notice of a question along similar lines.


Robert Emmett Finn: He did not give me notice.


Charles Gavan Power: I have prepared a reply. The question put to me by the other hon. member for Halifax was this:
It has been brought to my attention that a sick mariner was recently taken off a ship arriving from the far east which entered the port of Halifax and sent to Camp Hill hospital. Later it was learned that the patient was suffering from smallpox and died. Since then, others in the hospital have contracted this dread disease and, I understand, two orderlies are reported seriously ill.
In view of the danger of the spreading of this disease throughout the city of Halifax, I would like to ask the hon. minister:
(1)	If he has been made aware of this matter.
(2)	What steps have been taken to prevent a spread of this disease.
(3)	If it is the intention of the minister, in future, to allow quarantine cases, particularly of sick mariners, to enter Camp Hill hospital.
To this I have had the following reply prepared by the officers of the department:
fMr. Finn.]
The ss. City of Auckland arrived at Halifax on Monday, March 7. She was boarded by the quarantine officer, and the captain reported to him that there was no illness on board. Nevertheless, while the boat was being deratized at the request -of the captain the immigration medical officer was advised that one of the members of the crew was ill.
The sick person was removed to Camp Hill hospital where the case was diagnosed as one of smallpox. The patient was then removed to the quarantine station at Lawlor's Island where he died on March 9. On March 18 I was advised that the orderly who attended the smallpox case at Camp Hill hospital had contracted smallpox and that instructions had been issued to remove him to Lawlor's Island together with a nurse and orderly and all those who had been in contact with the patient unless they had been successfully vaccinated. On March 19 I was notified that a second orderly, who apparently had had a successful vaccination, had developed smallpox and that he was removed to Lawlor's Island together with two nurses and an orderly.
With respect to what steps have been taken to prevent a spread of this disease I would say this: As soon as it was ascertained that the patient was suffering from smallpox, the medical officer in charge of Camp Hill hospital issued instructions to vaccinate everyone in the hospital; to prevent anyone leaving the hospital and to prevent all visitors entering therein. All members of the crew of the ss. City of Auckland were vaccinated as well as all employees of the immigration building. Buses used in the transportation of the crew of the ss. City of Auckland to and from the immigration building and ship were fumigated and the bus drivers vaccinated. In addition, the crew of the quarantine boat, Salucan II, and members of their families were vaccinated. The city health officer and provincial health officer were notified and both gave every assistance that they could in preventing the spread of infection to the people of the city. Both expressed themselves as being satisfied with the measures taken by the quarantine officers and medical officers of Camp Hill hospital.
When advice was received that the orderly who had attended the patient at Camp Hill hospital had become ill with smallpox, all inmates of the hospital who had not shown a successful vaccination were revaccinated and complete quarantine imposed on the hospital,

Battlefields Commission
no one being permitted to enter or to leave. The Royal Canadian Mounted Police were requested to place an officer on the hospital grounds to prevent entry or exit by anyone. Any new ex-soldier cases are being hospitalized in civilian hospitals and a clinic has been opened in the city for the treatment of outdoor cases. The chief of the division of quarantine and immigration of the Department of Pensions and National Health was directed to proceed to Halifax to take charge of the situation. A departmental inquiry is under way and as soon as possible a board will be set up for the purpose of inquiring into all the circumstances and for ascertaining what steps if any should be taken to avoid a recurrence.
The third question asks if it is the intention of the minister to allow quarantined cases, particularly of sick mariners, in future to enter Camp Hill hospital.
No. It has never been the practice to permit patients suffering from known infectious or contagious diseases to enter Camp Hill hospital. All sailors suffering from a quarantinable disease are sent to the quarantine stations, of which there are four, namely, Lawlor's Island, N.S., Partridge Island, NJ3., Quebec, and William Head, B.C. All those suffering from other infectious diseases are sent to civic contagious disease hospitals with which the department has contracts at the various ports.



SHOP CARDS REGISTRATION


[Stage Direction]
On the orders of the day:
Hon. C. H. CAHAN (St. Lawrence-St. George):: I should like to ask the Secretary of State (Mr. Rinfret) if he will make available to hon. members on this side, or perhaps lay upon the table of the house, the opinion which has been given him by the Department of Justice as to the competence of parliament to enact Bill No. 22. I think if we were permitted to peruse that document it might shorten the discussion when the bill is again before the house.


Hon. FERNAND RINFRET (Secretary of State):: I have not yet received the opinion of the Department of Justice, beyond the mention made by the minister himself yesterday, but I will undertake to table it in ample time before we resume consideration of the bill.



UNEMPLOYMENT RELIEF


[Stage Direction]
ensuing Year
On the orders of the day:
Mr. T. L. CHURCH (Broadview):: I should like to direct a question to the Minister of Labour (Mr. Rogers). Has he been able to -ome to any determination yet on the application made by the mayors last week to place relief on the basis of 40-40-20? This is an urgent matter to the municipalities now preparing the tax rate.
Hon. NORMAN McL. ROGERS (Minister of Labour): The application of the mayors relates to the allocation of the grant in aid for the coming fiscal year. The estimates for this year have not as yet been brought before the house. Before they are submitted to the house of course there will be a very careful review of the situation in all the provinces of Canada.



BATTLEFIELDS COMMISSION


[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Finance) moved that the house go into committee to consider the following proposed resolution:
That it is expedient to bring in a measure to authorize the Minister of Finance to pay to the National Battlefields Commission the sum of $75,000 a year for a period not exceeding ten years from the first day of April, 1938, to be expended by the commission for the purposes and subject to the provisions of the act respecting the national battlefields at Quebec.
Motion agreed to and the house went into committee, Sir Eugene Fiset in the chair.
Mr. DUNNING:: This resolution precedes the introduction of a bill to continue for a further period of ten years the present statutory provision under which a grant of $75,000 a year is paid to the national battlefields commission. I could give details as to the operation of the commission, if it should be desired at this stage, or I could do so on the bill itself. I think most hon. members of the house are familiar with the work of the commission. I thought I would advance the measure a step to-day, thus enabling any members not here this afternoon but who may be here later to say anything they wish at a later stage.
Battlefields Commission


Thomas Langton Church: This is a most commendable vote, Mr. Chairman, but the last time it was before the house I put an inquiry to the government which I should like to repeat to-day. I have no objection to this vote, which began a little after the tercentenary in 1910. Quebec is a great gateway into Canada, and a great attraction to the tourist trade. Will the government consider marking out other battlefields? A bill was before the railway committee this morning, for instance, in connection with a new Niagara Falls bridge. The main battlefields in the Niagara district, a most important historic spot, should be improved. The battlefields are located at the gateway into the Niagara district, a district which enjoys the greatest tourist trade entering Canada. There are many battlefields in that district. One is at Point Mississauga, right at the mouth of the Niagara river where the steamer . Cayuga, sometimes carrying as many as three thousand passengers, passes by. At Niagara on the Lake there was a large camp during the great war.
Some of the battlefields are in ruins. True, some of them are under the control of the Niagara Falls parks commission, but something should be done to preserve these historic sites in the Niagara district. Then, we go on to Fort Erie, and at Ridgeway we are reminded of the Fenian raid. The provincial government is doing something at Fort Erie.
Next we come to the historic points in connection with the northwest rebellion. There should be equality among the provinces in connection with this matter. After all is said and done, the government might well take a leaf out of the book of the United States administration. Fort Oglethorpe, in the Cumberland valley in the United States, marks one of the points of battle in the great war between the northern and southern states. Every state in the union has erected its own monument to soldiers who contributed in that great civil war. Many miles of historic sites are preserved.
Since this expenditure was limited, the amount spent has been about the same. I do not think the commission is going far enough. In my opinion something should be done as well in the other provinces. Mr. Chairman, you take a great interest in this work, and I believe you would agree that something should be done to extend the principle of the measure to the Niagara district, and also to other provinces where the historic sites, although not as important to us, are of vast importance to the provinces in which they are located, both in the present and to posterity.


Mr. STEWART:: Has the act authorizing
an expenditure similar to this one expired, and if not when will it expire? Is it believed that this expenditure will complete the work the commission has in mind at Quebec, or is it just another instalment on something, the completion of which is still far in the future?


Charles Avery Dunning: The act itself does not
expire, but the section being amended does expire. The $75,000 annually provided in 1928 for a period of ten years, renewal of which is now asked for a further period, is the maintenance vote for that great area comprising the national battlefields at Quebec. To the hon. member for Broadview (Mr. Church) I would say that so far as I am aware most of the other battlefields are now and for many decades have been private property. Any move to attempt to revive their historic features would involve the acquisition of a considerable amount of property. On the other hand, the national battlefields at Quebec are public property, and were committed to the care of the commission. The vote is to cover the costs connected with maintenance of the battlefields area on the cliffs above Quebec.


Robert Emmett Finn: While favourable consideration should be given to the preservation of battlefields in Quebec, I must point out that the citadel at Halifax is perhaps the most historic spot in Canada. It is at that point that guns were first fired in Canada in connection with warfare, whether of a rebellious nature or connected with riots. I would ask the minister to give his careful consideration to a letter I shall send him in reference to citadel hill, in which I shall set out all the facts.


Thomas Langton Church: With all due respect to the minister's statement that Stoney Creek and Lundy's Lane are private property, may I say that they have no business to be private property. Historic sites should foe public property. In Ontario we have none of these memorials. Fort Mississauga at the mouth of the Niagara river is a heap of ruin. Some other memorials in the Niagara district are under the control of the Department of National Defence. It seems to me that all the memorials the province of Ontario has are two from the ox-cart days, namely the Trent canal and the Newmarket canal. They are the ones marked out by the government.
The old fort at Toronto was a mass of ruins for years until the city government improved it. At the present time there is some agreement between the government and the city

Battlefields Commission
respecting that historic spot. The city, I think, has the deed. Many memorials were created as a result of the great war. Those are places at which regiments from all points of Canada were trained and, to the people of the municipalities, they are historic spots. For instance, I know that one battalion was raised in Edmonton; in fact it spent about a week in Toronto. Then, there are memorials in connection with the northwest rebellion which mark the spot where soldiers from Ontario and Quebec fought for the unity of this country.
This is the only opportunity there will be to speak on the matter, and there is no reason why the subject should not be studied by some department. Several hundreds of millions of dollars are spent each year on maintenance charges, and surely, in view of the deficit there will be anyway, along some lines, you can afford a few dollars to mark these great war memorials. We have one, the memorial chamber, right in this building. There are many places all over Canada where young men who took part in the great war were trained and, in the eyes of the local communities, they are historic. Something should be done in cooperation with the provinces and municipalities to save these historic places for future generations.


Mr. DUFFUS:: I do not know much about the Newmarket canal, but-


Thomas Langton Church: I would ask the Minister of National Defence what he has to say about it.


Joseph James Duffus: I do not know much about the Newmarket canal, but I can assure the committee that the Trent canal is no memorial; it is a very live national entity.


Charles Avery Dunning: I think we should
distinguish between two different things. This expenditure has to do with the national battlefields commission. Then, as many hon. members are aware, there is another body known as the historic sites and monuments board. I believe they report to my colleague the Minister of Mines and Resources. On the recommendation of the board historic sites of various kinds have been and are being marked in various parts, of Canada. However, that work does not involve the provision of large sums of money for the maintenance of what amounts to a national park such as the one existing at the great battlefield on the heights of Abraham. I am not at all without sympathy for the views expressed by the hon. member for Broadview, but I do suggest to him that there is an opportunity to discuss
the matter on the vote for historic sites and monuments, under the Department of Mines and Resources.


Mr. HEAPS:: Who administers the present fund and looks after the administration of the national battlefields?


Charles Avery Dunning: The present commissioners are Sir George Garneau, LLD., chairman who has been on the board since 1908; Hon A. Turgeon, C.V.O., C.M.G., of Quebec.


Mr. MACKENZIE (Vancouver):: He is dead.


Charles Avery Dunning: I did not know that.


Abraham Albert Heaps: But he is still on the commission.


Charles Avery Dunning: The hon. Senator T. Chapais, senator, and a member of the legislative council of Quebec; Mr. N. A. Dussault, of Quebec; and there are at present three vacancies. Then, also appointed by the provinces there are the Hon. W. H. Price of Toronto and the Hon. L. A. Taschereau, K.C. of Quebec.


Abraham Albert Heaps: Has this commission complete control over the administration of the act?


Charles Avery Dunning: Yes.


Abraham Albert Heaps: Is nothing put on these memorials but references to historical events?


Charles Avery Dunning: I cannot answer that.


Mr. LANDERYOU:: What is the cost of the personnel of this commission?


Charles Avery Dunning: The commissioners receive no salary.


John Charles Landeryou: Is a salary paid to any one who may assist the commissioners?


Charles Avery Dunning: The secretary, Mr. Pacaud, receives a salary.


Leslie Gordon Bell: Is this appropriation to provide for additional work, or is it a regular maintenance appropriation?


Charles Avery Dunning: As I explained previously, it is a continuation of an arrangement which has been in force for the last ten years and which is covered by a statute. The sum of $75,000 is paid each year for maintenance.


Leslie Gordon Bell: Is it proposed to erect any further monuments or memorials on this battlefield?


Charles Avery Dunning: I know of no such proposal.


Mr. ISNOR:: I desire to join with my colleague, the other hon. member for Halifax, in his representations in connection with the citadel at Halifax. I have brought this matter
Transport Commission

to the attention of both the Department of National Defence and the Department of Mines and Resources on more than one occasion, and only last week I again presented it. I trust that the representations advanced to-day by my colleague will receive the favourable consideration of the various departments.
Resolution reported, read the second time and concurred in. Mr. Dunning thereupon moved for leave to introduce Bill No. 53, respecting the national battlefields at Quebec.
Motion agreed to and bill read the first time. TRANSPORT COMMISSION



AUTHORITY TO CONTROL TRANSPORT OF PASSENGERS AND GOODS BY RAILWAYS, SHIPS AND AIRCRAFT

[Stage Direction]
The house resumed from Monday, March 21, consideration of the motion of Mr. Howe for the second reading of Bill No. 31, to establish a board of transport commissioners for Canada, with authority in respect of transport by railways, ships and aircraft.
Robert Emmett Finn: Mr. Speaker, I moved the adjournment of this debate the other evening at ten minutes to eleven o'clock at the suggestion of the Prime Minister (Mr. Mackenzie King), and I now propose to continue with my remarks. I do not intend these to be in the nature of criticism; they are more in an effort to ascertain whether the provisions of this bill and the provisions of the Railway Act of 1919 will be in conflict. As I said the other night, the underlying principle of the Railway Act in connection with tariffs, tolls and rates is that no discrimination or preference shall be shown.
This bill provides that before a transportation company can operate-I assume this would apply to water transportation- a licence must be obtained. The bill provides also that the carrier and shipper may enter into a contract for a year or more for a specific rate for the transportation of goods. It is stipulated that the bill shall be subject to the provisions of the Railway Act and amendments thereto. Let us take the hypothetical case of a manufacturer in Ontario whose business is of such a kind and of such dimensions that he considers it profitable to enter into a contract with a transportation company for a year or more for the transportation of goods at a specific figure. However, there may be a smaller manufacturer whose business is not of sufficient magnitude to warrant his entering into such a contract. This manufacturer must pay the regular freight rate, which would be higher than the contract rate

in the other instance. The result is discrimination as between the two manufacturers. Therefore, if this bill should pass, there would be conflict between its provisions and those of the Railway Act. I should like to quote one section of the Railway Act as follows:
All tolls shall always under substantially similar circumstances and conditions, in respect of all traffic of the same description, and carried in or upon the like kind of cars or conveyances, passing over the same line or route, be charged equally to all persons and at the same rate, whether by weight, mileage or otherwise.
2.	No reduction or advance in any such tolls shall be made, either directly or indirectly, in favour of or against any particular person or company travelling upon or using the railway.
3.	The tolls for carload quantities or longer distances, may be proportionately less than the tolls for less than carload quantities, or shorter distances, if such tolls are, under substantially similar circumstances, charged equally to all persons.
i. No tolls shall be charged which unjustly discriminates between different localities.
As I said the other evening, the duties of the Minister of Transport (Mr. Howe) are varied. He has many branches to look after, and it is humanly impossible for any minister to deal directly with and pass final judgment upon all legislation having to do with the various branches. He must depend upon the advice of the technical officers in the branches. I suggested the other night that when this bill was up again the technical officers responsible for its drafting should be present to give any explanations required to clarify the situations, and to show conclusively to members of the house whether such a conflict will come into being when this measure is placed upon the statute book. The statute of 1919 is perfectly clear, and I would not have presumed to deal with this matter in the manner I have except for the fact that from 1916 to 1925 I appeared before the railway commission in reference to various questions of rates and differentials affecting the maritime provinces, and argued before the Supreme Court of Canada questions of law involved in the Crowsnest Pass Act of 1897 and reserved by the railway commission, and also because of the opinions expressed by the late chairman of the commission, Hon. Mr. Carvell, by the present vice-chairman, Doctor McLean, perhaps one of the ablest men who ever sat on the board of railway commissioners, and by various chairmen and members of the board, including the hon. gentleman who sits to my left, who has an honoured seat in this house and an honoured place in the hearts of everyone, the member for Outremont (Mr. Vien). So it is in no critical spirit that I am bringing this question up, nor was it the other evening,

Transport Commission
and I would like the Minister of Transport to feel that it is in no contentious way that I bring the matter to his attention and that of the house, bnt rather for the purposes of clarification and placing upon the statute books a law which will be effective, and which will not have to be referred to the supreme court, and then the privy council, to find out whether the jurisdiction of the commission is extended. There cannot be undue preferences given; there cannot be discrimination. Therefore there must be equality of rates; every manufacturer and corporation as well as the transportation companies must ;be treated alike, and it will be noted that the jurisdiction of the commission has been extended to cover water transportation.
It is for these reasons, Mr. Speaker, that I bring this matter to the attention of the house, in order that the legislation which we pass in this chamber may not be dealt with in the other chamber in such a manner as to suggest that we did not know what we were doing down here. I do not want this legislation to meet the same fate as Bill B, of last year, when it was in the other house for consideration. These are the reasons that have impelled me to make the remarks I have this afternoon and the other evening, when I asked the minister to give the matter his consideration and suggested that we might have the advice of his technical officers. I trust that in closing the debate he will be able to inform the house whether further amendments will be necessary in order to provide for contingencies which may arise through a conflict between the Railway Act of Canada of 1919 and the legislation now before us, as introduced by the minister, namely Bill No. 31, to establish a Board of Transport Commissioners for Canada, with authority in respect of transport by railways, dhips and aircraft.


Thomas Langton Church: Mr. Speaker, the motion before the house is for the second reading of this bill, and on the second reading the house considers the principle of the measure. The principle is considered to be the most important part of the bill, and on the second reading it is the principle only that can be discussed; the various sections of the bill cannot be considered until the bill gets into committee.
The first principle of this bill is that it extends the jurisdiction of the present board of railway commissioners and substitutes for the present board a new board to be known as the Board of Transport Commissioners for Canada, with authority in respect of transport by railways, ships and aircraft. Why coastal
transport on the gulf and the ocean and the general traffic on the Pacific coast and in Nova Scotia on the Atlantic are excluded is beyond me.
In England they have solved their railway problem. In this country we have a railway bungle-forty thousand miles of single track in a country of ten millions of people, a mileage almost equal to that of France, with forty-seven million people, and to that of the United Kingdom, with forty-six million, and almost equal to that of Germany, with sixty-seven million people. We have useless duplication, log-rolling politics everywhere in connection with the railways, and a waste of the people's money. The hon. gentleman who has just sat down (Mr. Finn) referred the other day to political appointments to the Canadian National board. No wonder that many people in this country want some dictator to arise to solve some of our domestic problems. The people are sick and tired of this parliament, which is a parliament of talk

that is all it is. That is all parliament has done so far-talk; nothing has been accomplished, and last week we were prevented even from talking and discussing a most important problem, that of our defence and foreign policy.
Last year a bill similar to this was considered by the other house and was sent to a committee which went over it clause by clause and made pages of amendments, but the bill now before us is entirely different from the one which was introduced in that other place. From this bill there has been deleted the regulation of motor buses and motor trucks on the highways, which was one of the most important clauses of all, because motor transport is taking the cream of the business away from the railways.
When this matter came up in the house in 1923, and afterwards when the late head of the Canadian National Railways was here, I complained to him and the committee on railways and shipping that the railways were too slow; that they ought to have grappled with this problem of motor buses and motor trucks years ago, and then they would have had the business to themselves. In 1922 and 1923 they could have had all the truck and motor bus business in Canada, then in its infancy as a transportation factor, before any regular bus and truck lines were running over the good roads of this country, and the railways have only themselves to blame if they were asleep and did not seize that business. That business is here to stay. There may be legal questions of jurisdiction. This parliament may have jurisdiction over interprovincial and international traffic, acting

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under the clause for the general advantage of Canada. But then there is the Chevrier transportation commission in Ontario.
At all events, we must make up our minds that motor buses and motor trucks are here to stay. A person nowadays can take his own car or go by motor bus almost from door to door to his destination; he can go through many cities and towns and back again home. Some of the buses from Toronto go right through the United States to Mexico. They operate throughout the United States a system of motor buses which carry some freight as well. That form of transportation is here to stay; and the railways should do something to get control of some of the business, either by purchase or amalgamation or otherwise; they should make some arrangement in some of the provinces where possible. It is going to cost a lot of money to do this, and it would have been much better had the railways done something of the kind years ago instead of building some of these branch lines all over the country and making the system and country pretty nearly bankrupt.
The present bill is not one which will regulate buses and trucks operating on the highways. I regret this because, after all is said and done, it seems that the government of Canada is being conducted from the provincial capitals. The federal government appears to be surrendering this motor bus and motor truck competition control without a contest and without even a recourse to the law courts, except to a lesser court for a decision on the question of jurisdiction. They have had no eases before the privy council to decide this problem of jurisdiction over bus and motor truck traffic by the parliament of Canada under section 91 regarding railway adjustments. It seems that no regulation and no bill can be passed by this honourable house without getting the opinion of a second parliament known as the attorneys-general, as the Minister of Justice (Mr. Lapointe) calls it. The Minister of Transport (Mr. Howe) has raised the same question in connection with the regulation of railways by setting up a similar claim of the provinces. The Chevrier royal commission in Ontario is now dealing with the matter, the result of which is very much in doubt. I fail to see anything of a constructive nature in the present bill, because it fails to provide for the proper control of transportation by this parliament. Parliament, not some outside commission, is the body which should have

control. We in this country are "commissioned" to death. Almost every week another commission is appointed; that is all we have been doing.
In my opinion Canada is suffering not from overregulation of the railways but from underregulation of them. If we had had proper regulation we should never have had the state of affairs which motor buses and trucks have created to-day. If the present bill is passed, the railways and rate structures will be in politics more than they have ever been before. I shall not discuss the bill clause by clause, but take for example part Y, agreed charges. Charges can now be made by agreement between the parties. All you have to do is to file the agreement with the new body, the transport board. That in my opinion is a retrograde step. The Board of Railway Commissioners for Canada may be criticized, but on the whole they have done very good work. As the minister is going to abolish them and substitute this new transport board, I should like to read two or three sentences from the 1936 issue of the Canada Year Book, indicating what good work that commission has done by way of regulation. It was established in 1903, its jurisdiction then being over freight and passenger rates only. A few years later, in 1909, the jurisdiction of the board was extended over express and telephone companies, and they did very good work in protecting the consumer and the public from excessive charges by those particular types of companies. At page 651 of the Canada Year Book, 1936, there are these two short paragraphs regarding regulation by the board of railway commissioners:
The Board of Railway Commissioners for Canada, as provided for by the amended Railway Act of 1903, was organized on February 1, 1904. In the beginning, its membership consisted of a chief commissioner, a deputy chief and one commissioner. In 1908 the membership was increased by the inclusion of an assistant chief commissioner and two other commissioners. According to the act, the board may be divided into two sections of three members.
The powers of the commission, in brief, are in matters relating to the location, construction and operation of railways.
In reading this, hon. members must now substitute the transport board.
Passenger rates are divided into standard and special freight rates into standard, special and competitive. Standard rates are maximum rates and the only ones which must be approved by the board before they are applied. Special and competitive rates, being less than maximum rates, may be applied by railways without the board's approval, provided that a change of rates has been advertised. But important rate adjustments usually come to the notice of the

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commission, for the changed rate alters the extent of the territory in which a shipper can compete and on this account he is apt to appeal the case to the commission. It is a knotty problem to mark the boundaries of competitive areas-to decide whether Nova Scotian manufacturers should be given rates which would allow them to compete west of Montreal, or again, whether high construction and operation costs in British Columbia should enforce a rate which prevents her goods from moving far into the prairies. By an amendment to the Railway Act, the regulation of telephone, telegraph and express rates was given to the commission, but with narrower powers than were given to it in dealing with railways.
The procedure of the board is informal, as suits the nature of its work, for experience has shown that hearings in strict legal form give the parties to the argument uncompromising attitudes. If possible, matters are settled by recommendations to the railway company or the shipper.
The railway committee of the privy council, the board's predecessor, was responsible to parliament.
On the whole, the board of railway commissioners have given very good service. As recently as last October I was present when they were holding a week's sessions in the city hall of Toronto. Farmers, truck people and representatives of municipalities from all over the Toronto district were before them in connection with grade crossings, and the present able and courteous chairman gave a careful hearing to the applications.
What are the government going to do by means of the present bill? They are going to substitute for that railway board a body to be known as the Board of Transport Commissioners for Canada. They are going to restrict the powers possessed by the present railway commission to deal with these problems in the manner I have indicated. Last year the hon. member for Parkdale (Mr. Spence) spoke, as a representative on behalf of the smaller business man, of what chance he had with the railway companies. The clause of the bill which deals with this matter is one of those which in my view are not in the public interest. We shall be going back to where we were years ago and having a political rate structure in this country instead of a fair and equitable rate after a proper hearing before a properly constituted rate control body. Under the present bill public control, in my opinion, will be non-existent. The bill further reduces the limited powers which shippers now have in respect of contracts and such matters between themselves and the railways.
In this connection it should be remembered that there are a great many small shippers in this country. I received a letter to-day
from one of them, who is a fairly large shipper, in the constituency I represent, and who is complaining about this particular matter. He believes that the small man will not have much chance to bargain with the railways under the provisions of part IV of this bill, where the licensee can make a bargain regarding rates over the heads of the railway commission and of parliament, along any lines he likes. I will hand a copy of the letter to the minister. I do not wish to make public the name of the writer. He is a shipper to a considerable extent, located on Matilda street, Toronto, in ward one, which is in my constituency. He says that he has just got notice from the newspapers of this bill, and he wants to know why it has been brought up. He says:
Under present conditions, when we figure our costs we know what freight we have to figure in to lay the goods down.
Under the present bill, he states, this will not be possible.
The proposed bill would seem to offer an advantage to big business.
The writer wants to find out from me what firm or group of firms, large or small, are asking for the legislation. He continues:
If any firm, or firms were permitted to arrange with a carrier for special rates on their goods, their competitors, or at least some of them, would be put to a disadvantage, either temporarily, or over a period of time.
Our freight tonnage is considerable. We do business from coast to coast, and while we might be able to arrange ourselves for some special freight rates, we feel we would have to be continuously checking up to see that some of our competitors were not getting a freight rate that we were not receiving.
We don't feel that we should be put in the position of having to do this, or having to be continuously protesting to the traffic board.
The late Sir Henry Thornton did not approve a policy like this. When my national coal policy was before the house and the committee on shipping, and it was proposed to give bonuses, subventions and subsidies to bring coal from Nova Scotia to the head of the lakes, Sir Henry Thornton told me that under my bill I was proposing a lunch-counter system of freight rates. Well that lunch-counter system I proposed was much better than sending some $56,000,000 to Pennsylvania coal barons a year. As a result of that policy a withering industry in the maritimes, the coal and steel industry, has been converted into one of the most prosperous industries in Canada, and to-day under that policy Nova Scotia is sending to the head of the lakes by water and rail and all water 3,000,000
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tons of coal a year economically, thanks to our leader's policy. If that is a sample of the results of the lunch-counter system of freight rates, let us have more of it.
' I am sorry to see the regulation of traffic on the highways omitted from the bill. I have here a letter from the former Minister of Transport in Great Britain, the Right Hon. Leslie Hore-Belisha, now Minister of War. He was Minister of Transport in England for three or four years and gave fine service in that office. In this letter he gives me an account of what has been done in England regarding the regulation of railways and improving the efficiency of transport, benefiting the consumer and bringing harmony into the railway situation. No one lost his job as a result of that unification, except a small number who were too old and who were given liberal pensions. The rest have been transferred to other duties. The same thing, I believe, could have been done here.
The Canadian National Railways started wrong. The head office of the railway should never have been taken to Montreal; it should have remained in Toronto, in Ontario, a public ownership province. The Canadian Pacific railway have transferred their eastern lines division office, which used to be in Montreal, to Toronto, under Mr. H. J. Humphrey, a vice-president. The direction and control of the lines in the whole territory between Winnipeg and the maritimes is under him. Why? Because they realize that Toronto as a rail centre outclasses Montreal in freight, passenger and hotel business, and a live corporation like the Canadian Pacific Railway Company goes where the cream of the business is, resulting from the great mining development in new Ontario. But what is the Canadian National doing? Political control and operation still exist, with headquarters in Montreal, although it is in Ontario they make most of their money. Who are its directors? Presidents of Liberal associations, the very thing condemned in the Drayton-Acworth report. The head office should be returned to Toronto where it was when Mr. Hanna was head of the first part of the system. I am not going to give my vote as a public ownership man to throw the Canadian National to the wolves to please some bankers and big business men who are responsible for the present railway bungle, and were to blame for launching a second and third transcontinental railway in the days of the "big I's". As a result of the railway deficits we have no money for social services; the municipalities are being raided of their revenues and taxes on real estate have reached an intolerable height.

It is the duty of the government to let us have a proper railway balance sheet. One thing about the finance minister's annual budget is that it is understandable to the ordinary layman. Barring the Bank of Canada item I think the budget can be fairly well understood. But it would take a Philadelphia lawyer to understand the present Canadian National Railways budget and debt and deficit statement. It is referred by the house to a "me too" committee known as the committee on railways and shipping, and after being there a few weeks it comes back and is passed by parliament without knowing anything about it. I doubt if many hon. members know much about railways. My observation in the committee was that they would call Sir Henry Thornton and other officers, ask about a few items, and then pass the thing pretty nearly as presented. There should be some more intelligible statement, but we shall not get it under this bill. A statement was made the other day by the Minister of Mines and Resources (Mr. Crerar) that there would be no saving. I need not read the speech; but the minister is well informed about railways, and he was challenging some statement made about the Canadian National Railways.
Colonel Drew also at Chatham the other night said the deficit was over $100,000,000. Something should be done to give a proper statement, one that the public who pay the bills can understand, and stop the damage done which is taking business from the Canadian National Railways. They are even using the radio to broadcast ridiculous statements. Why should a member of parliament, representing a political party, be selected by some outside body to make a speech over the radio at the expense of the Canadian people, even if he is defending the public road? According to Colonel Drew no one knows what the deficit is under the present fancy system of book-keeping.


Walter Edward Foster: I think the hon. member is wandering rather far away from the discussion of this bill, which deals with the institution of a board of transport.


Thomas Langton Church: My point is that this bill proposes to set up a board of transport commissioners with power to go over the head of parliament and regulate the Canadian National Railways, and it will not work. I am complaining that the people have no intelligible report, nor will they be able to get any more intelligible report or to stop damage being done to our railway. Under section 5 of this bill the board may regulate transportation by water, which will include the merchant marine. I contend that under

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the new board we shall not have any clearer statement of the position of the railway than in the past; that the issue will be more beclouded because shippers can make with the railways private arrangements outside the Railway Act, which they could not do before. I ask the minister whether under this new bill he will be able to give to the taxpayers and the shippers any clearer statement regarding this railway.
Then we come to a part of the bill which has been discussed on many occasions in and out of the house. Bill No. 31 ignores completely the report of the Drayton-Acworth commission recommending that the authority of the railway commission be extended in many ways, as set out on page 46 of that report. The bill further ignores the main recommendations of the Duff report, which referred to the contributing causes of the railway problem, criticizing the pass system and many other features.
As regards part III of the bill which deals with transport by air, the present board is a political board; that is all it is, and so will the new board be. The directors of the railway are all selected according to politics, and one of the great tasks facing the country is to solve this problem, but it will not be solved in the manner indicated.
In conclusion, Mr. Speaker, I object to the principle of this bill. I believe it is going to lead to more politics and political rate structures than ever in connection with the railway system. In Montreal it has been promised in a by-election that the new terminal will be completed, and other statements along that line have been made. Part III of the bill deals with the Canadian merchant marine and the control of shipping by water, which does not include the coastal trade, but includes the great lakes. Under this bill there is going to be a lack of coastal control which should be in the bill. As a parliament, what control have we over the merchant marine? We have none. Not long ago we sold for a few thousand dollars ships that cost a million and a half, just at a time when those ships could have been put to good use, since Great Britain needs ships in order to carry the food that is required. This bill conflicts with the report of the special committee regarding coastal shipping by water. Then there was the Petersen inquiry about fifteen years ago, as to what should be done to regulate rates, but that report has been ignored also. There are now 2,000 fewer merchant ships to cany food to England than there were before the war. We should not have parted with our merchant marine.
The railway problem is one of Canada's great difficulties. In England they are providing a proper solution for their problem. In the United States they are doing the same thing, but we as a people sit down from day to day and do nothing. I am for a real public ownership system, not for what is proposed under this bill, which is not public ownership at all. It is merely private ownership in the guise of public ownership. We have never had public ownership since this thing has been started. This railway is a collection of the mistakes made by private ownership; the Intercolonial, the old Canadian Northern, the Grand Trunk and the Grand Trunk Pacific. They were all bankrupt lines; they were placed together and it was called public ownership. Certainly it is not public ownership as they have it in Ontario, and under the present bill it will be much further removed from public ownership.
Before this bill is given second reading, I should like the Minister of Transport to tell the country what is going to be done with regard to the railway problem. During the last election campaign the government promised that if returned to power they would bring down a solution. This morning I attended a committee meeting in regard to a bridge in connection with Niagara Falls. This parliament has jurisdiction over bridges that are international or interprovincial or that affect navigation. Those bridges come under the Railway Act; but if this measure passes, they will come under the transport bill. But what do you see when you attend such a committee meeting? Talk about lobbying down at Washington; it is nothing to what we have in Ottawa such as was seen this morning.
In my opinion, Mr. Speaker, this bill should not be read a second time until the government are prepared to say what they are going to do in response to this clamour on the part of people all over Canada to reduce these deficits and give the Canadian National Railways a chance to carry on properly, unfettered and unhindered by politics.


Mr. THOMAS REID (New Westminster):: Mr. Speaker, in no country in the world is transportation of such vital importance as it is in Canada. Hence this bill, which I term an experiment on the North American continent if not in the world itself, is of particular importance to the people of Canada and especially to the people of British Columbia. I realize that under the rules one is not allowed to discuss the various clauses of a bill on second reading, but since the bill is divided into five parts it is difficult indeed not to

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touch lightly on some of its provisions. I shall endeavour to keep to the principle of the bill, but in discussing it I must touch on one or two very important points.
If one looks at the bill it will be noticed that under Part I an appeal can be made from the rulings of the board which is to be set up, which will consist of the present board of railway commissioners and perhaps some others. That is similar to the provision already in the Railway Act. I should like to direct the attention of the minister to the fact that although the Railway Act has such a provision and such an appeal can be made, that provision has been of little value since its incorporation in the act. There are two methods of appeal. If one goes before the railway commission and questions arise regarding judicial authority or matters of law, an appeal can be taken to the supreme court. But if it is a question of fact the appeal must be taken to the privy council, which in effect is the cabinet. This is what has been done for many long years. The privy council or the cabinet have been loath to reverse any decision given by the board of railway commissioners. It is not a fact-finding body, and in deciding against the railway board, or giving any judgment, a precedent would, they maintain, become established. Hence those of us who have had occasion to go before the privy council after having received an adverse decision from the board have found that no matter how just our cause may be the privy council has refused to reverse the opinion or judgment of that board. I would suggest to the minister that if in the present bill appeals against rulings made by the new board are restricted to questions of fact, there never will be any redress given because, as I have pointed out, the privy council have always taken the stand that they would establish a precedent if they gave any opinion or judgment contrary to the findings of the board.
Further on in the bill the board is directed to determine whether such future conveyances are necessary. In the province of British Columbia there has been a law on the statute books for some time concerning motor trucks for hire, and in operation this has gradually been getting down to a virtual monopoly on the part of certain companies. Those endeavouring to put a motor truck into operation in that province now find themselves up against a board, who say, "In our opinion there are far too many trucks operating on the roads now, and we are not going to give you a licence to go into that business." It is
[Mr. Reid.j
practically bringing about a monopoly, as I have said, on the part of certain transportation companies to the exclusion of others.
Further in the bill the public interest is mentioned, and I take it that here the bill is following the lines of the Railway Act. I submit that this language is not wide enough. I should like to refer the minister to the report of the Duncan commission of some years ago, in regard to these words " public interest." At page 25 of the report they say:
Section 320 of the Railway Act seems to give the wider powers that we have in mind to the railway commission, so far as the question of undue preference or unjust discrimination may be involved.
Then they quote section. 320, which reads:
320. In deciding whether a lower toll, or difference in treatment, does or does not amount to an undue preference or an unjust discrimination, the board may consider whether such lower toll, or difference in treatment is necessary for the purpose of securing, in the interests of the public, the traffic in respect of which it is made, and whether such object cannot be attained without unduly reducing the higher toll.
They have this to say regarding that section of the railway act which, I take it, is part of the new bill:
Even there we feel that, if the intention was to have larger national interests in mind, the section should be made clearer, and instead of the words "in the interests of the public" (which might be interpreted as in the interests of the "consuming" public), the words should clearly state that it is national interests (both "producing" and "consuming") that are in mind. If this was not the original intention of the section, we suggest it is the intention which should now be imported into it. We feel further that a similar extension of authority should be imparted to the railway board in regard to the question of reasonable compensation. It would then be competent for the railway board to make a survey of just the very character that the President of the Canadian National Railways testified as being part of his function (as the business head of a railway); and if from public policy they felt that an experimental rate should be conceded, they should be free to constitute the rate, even although it might not, at the time, or of itself, give reasonable compensation to the railway company.


Mr. MARTIN:: Where do you see " national interest "?


Thomas Reid: On page 3, at the foot of the page, and particularly in paragraph (c), section 5. Then, farther along in the bill we find that one must prove permanence of the service being offered by an applicant, and also must prove financial responsibility. Again one must be in business for one year. The section reads:
(a) That during the period of twelve months next preceding the coming into force of the relevant part of this act-

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New companies will have great difficulty entering the transport business if they have to prove that they were in the business for one year prior to the act coming into force, and must also prove their permanence.
How will the board of railway commissioners be able to decide what is advisable? Suppose the word "truck" were incorporated in the measure-which of course it is not, differing thereby from the bill of last year- how would the board be able to compare costs of hauling by truck, by boat or by air with railway haul costs, when no one can tell the cost of carrying goods by rail?
In evidence before the board of railway commissioners Mr. Flintoft said there was no expert in this or any other country who could tell what it actually costs to haul goods by rail. I ask the house to take note of that statement. How will it be possible for the board of transport commissioners to decide correctly when hauling costs by rail have not been gone into? They were instructed in 1925 to go into the matter, but have not yet carried out that instruction.
Ships between ports in Canada carrying goods to other ports in other provinces are to be licensed. I want to point out just how to my mind this will affect British Columbia. Shipping rates vary; they are lower or higher according to the demand for shipping. One shipping line has been taking lumber from New Westminster and Vancouver to Montreal at $5 per thousand feet under what the same lumber would have cost if carried by rail. What will that shipping company be up against when they make application for a licence? They will be' asked: "How long have you been in business? Is this transport going to be permanent? Are you going to haul lumber twelve months of the year, or are you going to jump out and jump in?" and so forth. Bear this in mind: British Columbia, unlike the interior and eastern provinces, has practically only two means of transport, either by water through the Panama canal, and thence to eastern ports, or by rail.


An hon. MEMBER:: And by air.


Thomas Reid: They will not transport much lumber by air. I am afraid this shipping company and the lumber interests are going to find themselves in difficulties if they have to come to a board sitting in Ottawa and ask that this shipping line be allowed to transport lumber to Montreal or Quebec. Probably they will be asked by the board: "Why do you want to go into this business now? There are two railways serving the 51952-103J
Pacific coast; we urge you to go back and use them." If this business of transport is to be carried out according to the proposed legislation, and British Columbia is to be faced with conditions such as those outlined in the bill, it will be to her disadvantage. We have no competitive lines such as are found in the eastern provinces.
On the last page of the bill these words are used:
Nothing in this part contained shall affect any right or obligation, granted or imposed by the Maritime Freight Rates Act.
I wonder why they left out the Crowsnest Pass rates?-because they are specifically mentioned in the present Railway Act, with the Maritime Freight Rates Act. The reason for this omission will perhaps be stated in committee; at the moment I simply draw the minister's attention to the fact.
I should like to deal now with some of the arguments put before the house by the minister on the introduction of the bill. I realize the minister's anxiety to obtain revenue, but I suggest that he is going about it in the wrong way. My own view is, using an expression which may not be strictly parliamentary, that he is going to hog-tie all present and future transportation systems, and is going to bolster up a railway system which, in my view, refuses to be modernized.
I shall take one or two minutes to point out to the minister where the great losses occur on our railways, and the danger in the fact that freight traffic is being called upon to bear a heavy burden. I know the statement has been made that Canada has the lowest freight rate structure in the world. Well, that is a wide statement. Perhaps if one had time to go into it he could show that there are certain goods carried in Canada which are charged a very excessive rate indeed.
In connection with losses may I say, first of all, that in 1922 there were 165,655 employees who received salaries of $233,290,040, or an average of $1,408. That amount has been decreasing, until in 1936 we find there were only 132,781 employees receiving a total salary of $182,638,365, or an average of $1,375 per employee. I mention those figures because I am going to endeavour to show to the House of Commons that there is something more seriously wrong with our railways than is usually pointed out by many speakers both in and out of this chamber. In 1922 more than 44,000,000 passengers were carried, with an average receipt per passenger of 2-82 cents per mile. The average receipts in the year per passenger amounted to $1.79.
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That figure has steadily decreased until we find that last year only 20,497,000 passengers were carried, with the average passenger receipt decreasing to $1.58. The freight traffic has not dropped to the same extent. In 1922 over 87,000,000 tons of freight were hauled. The receipts per ton averaged $2.01 and the receipts per ton mile averaged, $1,039. In 1935- I have not the figures for 1936-the freight hauled had decreased to 69,141,100 tons whereas the receipts per ton had increased to $3.06 and the receipts per ton mile had decreased only to $0,972. I am endeavouring to show that whereas there has been a considerable decrease in the case of the number of passengers carried and the revenue derived therefrom, the decrease in revenue from freight has not been nearly as great. While the freight tonnnage has decreased, at the present time it is paying more per ton than it did in 1922 or in the other years I have mentioned.
The total operating expenses of both railways in 1920 was $478,000,000, whereas in 1935 they had dropped to $261,000,000. In the meantime a number of economies had been brought about in operation. For instance three trains in 1928 equalled four in 1920. The total car capacity has been increased although the number of freight cars had dropped from something like 224,000 in 1920 to 217,000 in 1935. Fuel and upkeep costs are less and there has been a decrease in general expenses. The number of freight cars per freight train is greater and the number of employees and the compensation paid is less. Yet we have before us a bill which to my mind will load a little more on that part of the business which is already overburdened, the freight end. In spite of the fact that passenger traffic has dropped in Canada from 51,000,000 in 1919 to just over 20,000,000 last year, freight traffic has increased, as well as the receipts per ton mile.
In my opinion the minister is going about this matter in the wrong way if he expects to increase the receipts of our railways. I should like to refer briefly to what has taken place in the old country; both the leader of the opposition (Mr. Bennett) and the minister referred to that when they were speaking on the bill. We must bear in mind that this bill is not patterned after anything that now exists in the old eountry. As was pointed out by the leader of the opposition, it is an experiment; therefore we should be very careful about the provisions of the bill. In the old country there has been inaugurated a new system of goods rates and passenger fares which abolishes preferential and exceptional charges. It has been stipulated that wherever possible the
[Mr. Heid.3
scales of rates and tariffs shall be applied impartially over the whole system. According to this record, the passenger receipts last year in Great Britain per ton mile averaged $3.88 as compared with $1.58 for Canada.


Mr. BENNETT:: They increased the first class rates.


Thomas Reid: There are three rates in certain parts of the old country, but if you go into that you will find that the third class is the one that pays.


Richard Bedford Bennett: That is right.


Thomas Reid: The railways in the old country have not just been sitting down or trying to put the motor trucks and passenger cars out of business; they have gone out and made an effort to meet modern competition. Let me give one instance of how they take care of the farmer in Great Britain. The other day a north country farmer wanted to move into the south. He just put on his hat and coat and caught a train and the railway company did the rest. They went on to his farm and crated up his pigs, poultry, implements and other possessions and installed them all on the new farm. Such policies have resulted in greater economies and more profits to the railway companies. We must bear in mind that wages in the old country are 150 per cent higher to-day than they were during the war years.
I should like to deal now as briefly as possible with some of the arguments advanced by the minister. He stated that this bill will not increase rates. That may be so, but at the same time it will not permit a decrease in rates which I claim is all-important to the development of traffic and trade. The minister stated that this bill will keep down wasteful competition, but I should like to ask him, where is the wasteful competition so far as British Columbia is concerned? There are only two railways operating from the coast and every time we have come to the board of railway commissioners for redress we have been told that we could expect no relief because they did not feel like reversing judgments which had been handed down twenty or twenty-five years ago.
The minister stated that the railways are placed under a burden because of the fact that the motor trucks are not under the same regulations. I am glad to see that for the time being motor transport is not to be covered by this bill. The minister referred a number of times to motor transport, and it may be that he proposes to take two bites of

Transport Commission
the cherry, so to speak. He may come back another time and ask that the motor transport provisions in the bill of last year be included in this one.
The minister referred to the regulations under which the railroads had to operate. I should like to point out that the board of railway commissioners was set up to protect the public, not the railroads. When this board was set up it was felt that the railroads held a monopoly and this action was taken to prevent the further exploitation of the public. But a new principle is being introduced by this bill. This legislation is being introduced not to protect the public but to protect the railroads alone. I maintain that that principle can be found through the entire bill. It is new to this country and is something that should be watched very carefully. Because of this I felt it incumbent uopn me to speak before the bill reached the committee stage.
When this legislation was discussed last year in the senate it was argued that the agreed charges provision was to take care of unprotected competition. I ask hon. members to read this clause carefully. My reading of it leads me to the conclusion that it is intended to control protected, unprotected and every other kind of competition, with the exception for the time being of motor trucks. However, that may come along a little later. One of the most startling statements by the minister is to be found on page 1554 of Hansard, where he is reported as saying:
On the other hand, individual carriers who fear that rate regulation will result in the establishment of unreasonably low rates, as a result of the board of transport forcing carriers to adopt the lowest rate published by an improvident competitor, can be assured that the bill provides ample remedies against such a condition.
That to me is telling the country that the rate structure is not going to be lowered much but that an endeavour is to be made to maintain it in the face of falling revenues and because of the fact that what this country needs more than anything else is increased traffic and trade.
I am going to give the house one pertinent illustration bearing on the competition of motor trucks with railways. There is a fish contract for the hauling of five tons of fish each week from Vancouver to Calgary. The rates quoted, I believe, by the railway to the people shipping the fish is six cents a pound by express and three and a quarter cents by freight, although, mark you, it costs no more to haul the fish by express, because it goes
over the same track and perhaps by the same train as the freight. Two men who have a splendid line of motor trucks got in touch with the shipper. They took a trip into Alberta through the United States, and found out what taxes they would have to pay. It was ascertained that the taxes would amount to $600 per truck per year; and I mention that because it has been too glibly said in this house that the motor trucks are getting off too light. If they put this truck line into operation between Vancouver and Calgary it would cost them in taxes, about $600 per truck per annum. After going into the matter very carefully they came to the firm and said, "We will haul that fish for you at two and a quarter cents per pound and land it in Calgary two hours ahead of the train. That line would have been in operation right now, but when the men went to the customs department they were told: We cannot allow you to put the railroads out of business, and we are not going to allow you to take fish out of Vancouver, over United States highways and bring it into Calgary in bond. So that project was stopped. I mention it, Mr. Speaker, because the people of this country want lower freight rates, not higher freight rates, and the great loss on railway passenger traffic is being loaded on to the freight traffic. Instead of the railways modernizing their equipment and meeting this competition, they are saying to the minister: give us a bill that will regulate and keep out the motor truck or any other form of transport which is likely to compete with us.
It is all very well for the minister to give the house his opinion, as all ministers before him have done, or would do if placed in a similar position. But before closing I want to read from an order in council, and I ask any hon. member, if he were faced with interpreting it, whether he would not interpret it differently from what the board of railway commissioners has done.
There was an order in council passed by the government in 1925 directing the board of railway commissioners to investigate fully the freight rate structure of this country. I am going to read one clause of that order in council, which gives the board very wide, almost unlimited, powers. Here it is:
The committee therefore advise that the board be directed to make a thorough investigation of the rate structure of railways and railway companies subject to the jurisdiction of parliament, with a view to the establishment of a fair and reasonable rate structure, which will, under substantially similar circumstances and conditions, be equal in its application to all
Transport Commission

persons and localities, so as to permit of the freest possible interchange of commodities between the various provinces and territories of the dominion and the expansion of its trade, both foreign and domestic, having due regard to the needs of its agricultural and other basic industries.
Then it goes on to particularize. What could be wider in language than that? What could give the board greater scope? But was that ever done? Did the board ever interpret that order in the wide sense that parliament thought they would, or at least as the ordinary layman would expect? I mention it to warn the members of this house to be very careful in their consideration of this bill, which touches for the first time a new phase of transportation, and see to it that every clause is carefully scanned and that the widest powers are given to protect not only shippers but the great consuming public. Believing, Mr. Speaker, that this bill touches the province of British Columbia to a very considerable extent in that it will interfere with the shipment of lumber and other goods through the Panama canal, I felt it incumbent upon me to assure the minister and the house that I am going to watch it very carefully, and I trust that many of the matters I have touched upon will be investigated before the bill is passed.


Mr. P. C. BETTS (London):: Mr. Speaker, I should like to criticize the sections of the bill contained in part V which deal with agreed charges. I take exception to them on the ground that, reading this bill and the English legislation along similar lines, it seems to me that in drafting this bill the English legislation has been followed too closely, perhaps almost slavishly, and due regard has not been had to the very marked differences, geographical and economic, between the transportation problems of this country and those of the old land.
I would submit, further, that we would be far better advised to defer the introduction of this agreed charge principle until we have had more of an opportunity of seeing how it works out in Great Britain. I would therefore urge the minister, and the committee to which this bill will be referred, to delete the agreed charge sections of the bill.


Mr. O. B. ELLIOTT (Kindersley):: canals therefore approximates $70,000,000, which is slightly more than the deficit of the Canadian National Railways.
Taking it from another angle, Mr. S. W. Fairweather, Canadian National Railways economic expert, speaking at Toronto on December 6, 1937, stated that in percentages of national income Canada's total land transportation bill is approximately as follows:
Per cent
Steam railways	 9
Motor vehicles	and	highways..	..	20Street and electric	railways....	1Airlines	
1
He goes on to say that if an attempt were made to perform with the motor vehicle the services now rendered by the railways we would spend forty per cent of our national income.
We are subsidizing export shipments of wheat by low freight rates, while at the same time wheat for consumption in British Columbia is charged almost double the export rate. Competitive rates by freight and express to meet motor competition as well as passenger rates, are much below the published rates of the railways, which would indicate that by an increase in passenger and freight traffic a general revision of tariffs could be accomplished. I know from personal experience that in a certain city in the west the railways attempted to reduce their rates in order to meet highway traffic competition, but on every occasion the motor trucks reduced their rates below those of the railways, which in turn compelled them to carry freight and express at much below cost. If the principle is right that highway traffic, canals and ocean shipping can be subsidized effectively. it appears to me that a proper system of railway freight tariffs applying on bulk shipments of heavy commodities having to be transported great distances would have a beneficial effect on Canadian business and industry generally.
We all recognize that transportation is essential to our national life in peace, and perhaps particularly in war, and it is essential that the problem be solved to the advantage of all the communities in the dominion. It is my belief that a system of transportation rates under which the delivered cost of all necessaries of life would be uniform at every point in Canada reached by the transportation system is desirable. I venture to say that, as a result, in the course of a few years Canadian business and municipalities, as well as the railways, would be the most prosperous in the world. For example, putting the Canadian National Railways to work hauling coal to tidewater, to western Ontario, 
Saskatchewan and Manitoba points, at a rate not exceeding $2 a ton, so that shippers could deliver a good quality of coal at perhaps $5 a ton from our Alberta and Saskatchewan fields, would go far to solve the railway problem at the present time. It would pqt many thousands of men into permanent employment and do away with the necessity of a debate such as we had here on Monday regarding large numbers of men being laid off by the railways.
In cities like Winnipeg, Regina, Moose Jaw, Vancouver, or Prince Rupert, if fuel costs were cut in half it would immediately offset the burden of taxation. Take for instance an industry requiring four tons of coal a day. At $10 a ton, which they have to pay at the present, time, the industry is unable to operate, but at $5 a ton it could flourish, keeping men in employment, giving the community the satisfaction of added business, and the railways perhaps sufficient profit. This I think would warrant the railways adopting such a policy and earning dividends, instead of bemoaning their troubles and unloading their deficit on the government.
Lumber, coal, grain, fruit, etc., are geared to give the railways real money on an equalized rate basis. At the present time, when the prairie people are so urgently in need of building material, transportation costs on lumber from British Columbia to the prairie provinces are equivalent to if not greater than the price of the lumber. Houses are most urgently needed throughout the prairies, and elsewhere in the dominion so far as that is concerned. Owing to the curtailment of their earning power, people have not been able to make good the depletion of their resources. I understand that Winnipeg during the last two years has had about 5,300 marriages, with no increase in housing accommodation.
The purpose of the bill, as I see it, is to assist transportation agencies in meeting their financial obligations, as well as to prevent discrimination between different types of transportation. I foresee the possibility in the near future of amendments to this bill to make it include the whole of our transportation system. I hope this will be possible, but I see no reason for delaying action at this time towards the solution of our railway problem until we can coordinate all kinds of transportation. I suggest a policy of bringing the necessities of life and of industry to every community in Canada reached by rail or water, on a uniform cost basis fairly approximating world values. With such a policy I am convinced that Canada would soon be the richest country per capita in the world. By making Canada prosperous we would soon

Trans-port Commission
overcome the handicap of our small per capita population in regard to railway mileage. I was interested in checking up the population per mile. I find that in 1901 we had a population of 5,337,000 with 18.100 miles of railway, or 300 people per mile. In 1916, with 7,500,000 people, the railway mileage had increased to 40,584, or 185 people per mile. In 1932 with 41,024 miles of railway we had 224 people per mile, and in 1937, with 42,000 miles of railway, that had increased to 261 people per mile.
It might be interesting also to note how the population is distributed according to provinces, as follows:
		Railroad	Per
Population	mileage	CapitaP.E.I	92,000	286-05	322Nova Scotia . . . .	537,000	1,397-21	384New Brunswick. .	435,000	1,871-22	232Quebec	3,090,000	4,777-45	648Ontario	3,090,000	10,746-06	343Manitoba	711,000	4.S59-57	146Saskatchewan. . .	931,000	8,023-52	108Alberta	772,000	5,686-44	136British Columbia.	750,000	3,907-37	192Yukon Territory..	4,000	57-72	693Total	11,028,000	42,212-61	261
Saskatchewan, as will be noted, has the smallest population per mile of railway, but much of this mileage was constructed to connect with the sources of raw material, such as coal in Alberta and fish and lumber in British Columbia, and latterly great quantities of oil and salt in Alberta, in addition to agricultural products. For years the railways struggled against high tariff walls in the United States, but even worse than those high tariffs was the policy of keeping in effect a destructive system of freight rates which neutralized the existence of favourable grades for freight handling on the Canadian National. One instance is that portion of the Canadian National which reaches the Pacific ocean at Prince Rupert, which is three days less steaming distance to oriental ports than any other north Pacific point. The million dollars tied up in the Prince Rupert branch of the Canadian National is kept dormant because the rate on coal from the mountain coal fields, for example has been fixed and kept at an amount higher than the value of the coal at tidewater.
We have other coal resources which are not being exploited. I refer to the Groundhog anthracite coal fields, which of course would require a connection with the Peace river district and an outlet on the western coast. The Groundhog coal fields contain the largest compact body of anthracite so far discovered in
the world, sufficiently close to Pacific ports to permit the coal to be delivered to any port on the coast at a very low freight rate. It is estimated that it can be delivered to any trading port in the world at less than $8 per ton. This in my estimation is a national prize that is worth taking, but after reviewing the coal situation in various parts of the world I believe it should be handled as a public utility, which eventually would develop into a great national asset.
In conclusion I should like to direct a question to the Minister of Transport (Mr. Howe) with regard to tolls on our canal system. I should like to know if in any way this bill will inaugurate a system of canal tolls.


Mr. H. C. GREEN (Vancouver South):: Mr. Speaker, the question how we in this national parliament can help to improve the transportation industry in Canada is most difficult and involved; perhaps even more involved and more difficult is the question of freight rates. I realize that this bill is to be sent to the railway committee, where there will be an opportunity to have it considered in detail; but before it reaches that stage I should like to point out one or two things to the minister and, if he sees fit, I would ask him to clear them up in his remarks when he closes the debate.
The other night the minister said that the object of this bill was the stabilization of the transport industry in Canada, which we all agree is a very worthy object indeed. I think the first four parts of the bill undoubtedly will help to accomplish that end. They are provisions dealing with the appointment of the board, with transportation by water, with transportation by air, and with traffic tolls ~nd rates. The key to these four parts, however, is contained in section 24 of the bill, which I will read to the house:
24. (1) All tolls shall always under substantially similar circumstances and conditions, in respect of all traffic of the same description, and carried in like manner over the same route, be charged equally to all persons and at the same rate, whether by weight, mileage or otherwise.
(2)	No reduction or advance in any such tolls shall be made either directly or indirectly, in favour of or against any particular passenger or shipper.
(3)	No toll shall be charged which unjustly discriminates between different localities.
The minister will agree that this section is almost word for word with section 314 of the Railway Act. It appears to have been copied from the Railway Act.


Mr. HOWE:: Yes; it is the same.
Transport Commission


Howard Charles Green: So far the principle of the bill seems to me to be correct; but in part V we have a new principle, a second principle, which I doubt very much will help to stabilize the transport industry. It overrides the section I have just read. I would refer the minister to the first few lines of section 35, which is the first section dealing with agreed charges. It says:
Notwithstanding anything in the Railway Act, or in this act-
That, of course, would cover section 24.
-or in any other statute, a carrier may make such charge or charges for the transport of the goods of any shipper or for the transport of any part of his goods as may be agreed between the carrier and that shipper-
That is an entirely new principle.


Clarence Decatur Howe: Mr. Speaker, I think it is hardly fair to read that clause without reading the whole section. My hon. friend stopped just where the limitation comes in with regard to what he read. I think he should read the rest of it.


Howard Charles Green: I have no intention whatever of being unfair, and if the minister wishes I shall be glad to read the balance of the subsection :
Provided that any such agreed charge shall require the approval of the board, and the board shall not approve such charge if, in its opinion, the object to be secured by the making of the agreement can, having regard to all the circumstances, adequately be secured by means of a special or competitive tariff of tolls under the railway act or this act.
I submit this proviso does not help very much.
It may be wise to have a provision for agreed charges in order to meet traffic which is competing with the railways, but which is uncontrolled-in other words, traffic which does not come under the act such as competition provided by motor trucks which, we all admit, is serious. I will not deal with the question as to whether or not provision should be made to enable the railways to deal harshly with motor truck competition; arguments have been brought forward in favour of a provision for that purpose. But I do suggest to the minister that a way of meeting uncontrolled traffic was all the railways were asking last year when they appeared before the standing committee of the senate on railways, telegraphs and harbours with respect to Bill B of the senate. I would refer to page 332 of the proceedings before that committee and particularly to an answer given by Mr. E. P. Flintoft, K.C., who was representing the Railway Association of Canada. He said this:

There is this situation which is not covered by the act. There is all this local traffic, intraprovincial traffic that is being carried by the trucks, which this bill will not affect, and in respect of which they can make all the agreements they like. We say all the carriers should be in the same position, and that we should have the opportunity of making agreed charges if we find it necessary to do so in order to meet that traffic which is uncontrolled by this act.
The present measure seeks to go farther than that. It enables the railways to challenge and perhaps to wipe out competing traffic, traffic which is competing fairly and which, like the railways, is actually controlled by this measure.
An example is transport by water. It is with that one point that the people on the Pacific coast are so very much concerned. As the minister is well aware, there is water transport from eastern Canada through the Panama canal to British Columbia. Of course, there is transhipment in certain cases; but we know that goods are moved by water from Ontario, Montreal and Quebec, and in the winter from Halifax or St. John, through the Panama canal to British Columbia.
That canal was completed during the great war, but it took several years for the people of Canada and even for our business men to realize what great advantages had accrued to them by reason of its completion. However, because of that canal we now have established in Canada a great many comparatively short rail hauls from each coast to the interior. For example, goods brought by water to Vancouver are carried by rail to Calgary, Edmonton and other points in Alberta, being shipped cheaper by water through the canal to Vancouver and thence to points in Alberta than they can be shipped from eastern Canadian points to Alberta by rail. There is the possibility that under this bill that advantage might be destroyed.
As all hon. members are aware, water transport is cheaper than rail transport and, as I have said, we can get some goods from eastern Canada cheaper by water than by rail. While we cannot get all goods cheaper, the very fact that there is water transportation means that there is competition for the railways, and that railway rates to the coast have been cut to meet these water rates. I believe that in some cases goods can be shipped cheaper to the Pacific coast from eastern Canada than they can be shipped to Calgary and Edmonton, and the reason is that there is water competition through the Panama canal. That is of great benefit not only to the people in my province but to manufacturers and shippers in Ontario, Quebec and

Transport Commission
the maritime provinces and it is of great benefit to the people in Alberta because they can obtain goods cheaper in that way than by having them hauled all rail across Canada.
Yet under part V of the bill, by making agreed charges with the companies at present shipping goods by water, the railways can cut into this water transport business, and perhaps will be able to wipe it out altogether. If the water competition is wiped out, the result will almost certainly be an increase in freight rates to the coast which, I submit, is absolutely unfair, particularly in view of the fact that this same water transport is actually regulated by the bill. The bill gives the new board of transport commissioners the power to regulate water transport. It was believed, incidentally, that coast to coast water transport would not come under control; but not only traffic from British Columbia to Ontario and Quebec is covered by this bill but also traffic from Halifax and Saint John and other maritime points to Quebec and Ontario. I submit that it is not fair that the railways should, under the bill, be in a position to attack and perhaps to destroy fair competition by water, which is also regulated under the bill.
Mention has been made of the effect the measure would have on small dealers. The argument is that the large dealers, such as departmental and chain stores, will be able to make special arrangements with the railways, whereby they will have their goods transported more cheaply than will the small dealers. That will affect British Columbia more than any other province in Canada, because the cost of hauling goods to the coast is a greater item in prices than it is in any other part of Canada. I do not see how the measure can help being detrimental to the small dealer. It is true that there are protective clauses. I have no doubt those clauses have been carefully drawn, because I know the minister is most conscientious in all things, but I suggest that those protective clauses may sound better than they will work. A small dealer is not in a position to come from British Columbia to Ottawa, or from Calgary or Edmonton to Ottawa to appear before the transport board. He is not in a position to hire expensive counsel to represent him. The net result will be that the big man will receive the benefits and the little man will be just out of luck. That is not fair. The protective clauses are too cumbersome. I believe the result will be discrimination, and just the reverse of the stabilization of the industry which the minister is so anxious to achieve.
Then, I should like him to explain to us why such commodities as iron bars, rails, flour and grain products, newsprint, wood pulp, lumber and lumber products, naphtha, fuel oil in drums, sugar in bags and articles of that type, are not defined as " goods in bulk " and thereby taken out from regulation under the-


Clarence Decatur Howe: What do you leave in? Name two or three articles you leave in.


Howard Charles Green: I should like to know why some of these are not included. This bill has the appearance of forcing the carriage of package freight by rail rather than by water on the great lakes.
In conclusion, there is one other point I should like to mention. For years we have been pressing for the completion of the trans-Canada highway, but the remarks of the minister when introducing this bill the other day would lead me to fear that there is not much possibility of the present government completing the road. I do not know whether my conclusion is just, but that is the way it looks to me. I suggest to the minister that the completion of this highway would not hurt the railways. It would provide a means for Canadians to travel through their own country; at the present time thousands and perhaps hundreds of thousands of Canadians are forced to travel through the United States; in addition it would mean a greatly increased revenue from the tourist industry, and I believe it would actually be one way of helping to solve our transportation problems.


Clarence Decatur Howe: Mr. Speaker, I think it can fairly be said that there is general agreement as to the principle of this bill, although this is tinged with some scepticism. However, that is not surprising as this is a difficult bill. None the less I consider it an extremely important piece of legislation; Ever since I accepted my present office, a substantial number of citizens has been asking me why I did not do something courageous about the railway problem. I have heard the word "courage" almost every day. I believe the introduction of this bill requires a little courage as it introduces a new principle, particularly part Y. I urge that we all take a courageous view of this matter.
The provisions of this bill will be applied by the board of railway commissioners, about which we know something and in which we have great confidence. It is true the name of the board will be changed, but that will be the only change. It will be still a board set up by the people of Canada for the protection of the people of Canada.
Transport Commission

There is no doubt that the provisions of this bill will have to be applied with a great deal of caution, but I think we can trust the board to proceed cautiously in its work. After a great deal of study I am convinced that this is the procedure which will give the most help to our transportation system and cause the least disturbance to business generally. I think it is the only practical thing we can do at this particular time. I regret that a year has been lost since this legislation was first introduced, as some progress might have been made in that time in working out the principles of the bill.
As I followed the discussion it appeared to me that there is not much question as to the desirability of regulating the rates of inland shipping and the aviation industry. I know our aviation industry in particular has felt the need of regulation. I think I can say that both these industries are acquiescing in the move now being made. They realize that it will be in their interests to have a board set up before which they can appear to justify the rates they are charging. The hon. member for Comox-Albemi (Mr. Neill) has objected to our not including rate regulation for the Pacific coast, but I say to him frankly that the reason that is not included is a desire to keep this bill down to the bare essentials.
I had a rather gruelling experience last year in piloting a similar bill through a committee., and I have introduced this bill on the assumption that it should be kept within strict limits if it is to complete its passage through parliament. I admit at once that the contentions of the hon. member are fairly well justified, particularly in their application to the Pacific coast where the steamships of our two railway companies carry a large proportion of the freight and are subject to the regulations of the railway board. I think I have assumed my full share of responsibility in bringing down the bill in its present form, and if the hon. member will take the responsibility for the suggestions he has made and can convince the committee, when the bill is before it, that they should be added to the bill, I shall give him my best support in having an amendment adopted.
Let me deal now with the matter of agreed charges, which will be the difficult part of this legislation. I am convinced that the fears and alarms in connection with agreed charges can be largely dispelled by a full discussion. The first study of these agreed charges creates a worse impression than the facts warrant. We have in this country at the present time an intolerable situation, in that our railway tariffs are the barometer for

what other forms of transportation may charge. We have built up over the years a rate structure which I think we all believe is absolutely essential to the well-being of Canada. The basis of that rate structure is that low priced commodities shall be carried at a low rate, and that the natural products of our country, particularly those of our prairies, shall be carried the great distances to our seaboard at export rates which are undoubtedly the lowest on this continent. I believe Canada has the lowest ton mile rates of any country in the world.
To permit our railways to carry these commodities long distances at exceedingly low rates, it was necessary that the structure provide that the rates on commodities of a greater value and moving shorter distances should be proportionately higher. The rate structure having been built on that basis, the result is that the railroads have been exceedingly vulnerable to competition from motor trucks. These motor trucks are interested only in high-grade commodities, and serious inroads have been made in the tonnage of these commodities carried by the railroads. The railroads have attempted to meet that competition by a general reduction in commodity rates, that is, by applying competitive tariffs.


Richard Bedford Bennett: And reducing express
charges.


Clarence Decatur Howe: And by reducing express
charges and speeding up trains. The speeding up of trains is a proper competitive move, in that it provides perhaps a better service than can be given by the trucks. But in the matter of rates the railway is, in the long run, helpless. For instance, a large manufacturer or dealer in an important railway commodity can go to the railway and say: "I have been offered a certain rate for moving my business by truck; I prefer to move by railway, but you must meet that truck rate." The traffic officers give the matter some study and find that it is in the interest of the railway to retain that business, and so say to the shipper: "We will meet the rate; we will cut our tariff to hold your business." That means that they cut their tariff from coast to coast. But that does not hold the business at all. It may hold it for a while; but after a few months the trucker may come back and say: "I have worked out my schedules so that I can now cut that rate again, and I will take your business." The railway having gone as far at it could go, cannot cut its rate again and so must say to the shipper: "Very well; we throw up our hands; move your business by truck."

Transport Commission
I claim, Mr. Speaker, and we all know, that the railways are capable of moving a ton-mile of freight at a cheaper rate than any other mode of transportation except the bulk carriers, and it seems to me that having that fundamental advantage the railways should be placed in a competitive position where they can reap the benefit of that fundamental advantage. It seems to me hardly fair to make the railways forever the regulator of rates on highway traffic. We have a good many cases before the railway board for tearing up branch lines on which all the traffic has been lost to the trucks. Of course, when we attempt to take up such a branch line, we have serious objections from shippers all along the line, even though they are not users of the railway. The basis of their objection is not that they need the railway themselves for moving their goods; but they say: "We need that railway to regulate truck rates; do not leave us at the mercy of the truckers." Surely it is not reasonable to ask that the railways be maintained merely to set a rate under which trucks must operate to take competitive business.
Great Britain had this trouble perhaps to a greater extent than Canada, because their distances are shorter and a larger proportion of railway business there is vulnerable to truck competition than would be the case in Canada. In the old country the principle of agreed charges has been adopted and applied, and I am told that after a thorough trial the British people are well satisfied with agreed charges as a means of straightening out their transportation difficulties. My deputy minister spent some months in England within the last year studying this question. He made a thorough report on the subject, and I was convinced by his report that our earlier information was correct and that agreed charges are working out to the benefit of the public as well as of the transportation industry itself. I urge that every member give some study to the question of agreed charges and not form his opinion from one or two cases only, which may be brought before him.
It must be borne in mind that the essence of an agreed charge is a lack of discrimination. It must be obvious that it is not detrimental to the small shipper as against the large shipper, because if an agreed charge is given to a large shipper the railways must be prepared to grant the same agreed charge to any shipper, large or small, who is willing to . comply with the same terms as the shipper for whom the agreed charge is made. That is the essence of the agreement, and the first duty of the board of transport commissioners will . be to see, before an agreed charge is decided upon, that there is no discrimination.


Mr. LAWSON:: If there was an agreed charge for the movement of an average of, say one hundred thousand tons a year by a large shipper, do I understand the minister's statement to mean that the same agreed charge would be applicable to some smaller firm that was moving only one thousand tons in the same year?


Clarence Decatur Howe: Exactly. The charge must be the same to all persons who are willing to abide by the same conditions. In other words, the agreement is a public document, and anyone who is willing to write the same agreement must get the same treatment.


James Earl Lawson: The same except as to quantity.
' Mr. HOWE:	The same except as to
quantity. The conditions of the movement must be the same; the bill provides for that.
The hon. member for Vancouver South (Mr. Green) mentioned shipments by the Panama canal. The United States for many years has found it necessary to regulate all coastwise shipments via the Panama canal. That comes in direct competition with the railways, and when regulation was applied to shipping, the coastwise shipping through the Panama canal was the first item to which regulation was applied.


Howard Charles Green: But had they these agreed charges?


Clarence Decatur Howe: I do not know what that has to do with the question, but as a matter of fact they have not agreed charges in the United States.


Richard Bedford Bennett: That is his point, that the agreed charges have to do with Panama shipments.


Clarence Decatur Howe: Quite. In the first place I would say that we have protection in the bill against the very thing that my hon. friend fears.
My hon. friend also said that this bill was a slavish copy of the British act.


Howard Charles Green: I did not say that.


Richard Bedford Bennett: It was the hon. member for London (Mr. Betts).


Clarence Decatur Howe: I am sorry. The British act provides that any shipper or body of shippers can produce an agreed charge. We go further than that. We also provide that any carrier can protest against the agreed charge; that is, any carrier under this act, which means any regulated carrier.


Richard Bedford Bennett: Would that mean that one carrier could protest against another carrier making an agreed charge?
Transport Commission


Clarence Decatur Howe: Quite. Any carrier may protest that the agreed charge is unduly injurious to his business. We have a further provision, that even after the agreed charge is made, if representation is made to the minister that in the public interest this charge is working unfairly, the minister can send the case back to the transport board for rehearing. That clause was introduced in the English act, and we have it in our bill exactly for the reason my hon. friend suggests, to make sure that an agreed charge, even after it is agreed to, is not working to put a competitor out of business. So I think further study will indicate that we have ample safeguards.
What is the situation to-day with regard to that one ship? I think we have only one ship plying between Vancouver and Montreal. That one ship has agreements with the railways that "We will take only a certain proportion of this thing and only a certain proportion of that thing." They carry it at the railway rates; they fill the boat at the expense of the railways. Why is it unfair to bring that boat under regulation? If a spread in prices is required, let the board determine what the spread will be; but why have this month to month rule that "We will only have fifty per cent of the salmon or thirty per cent of the iron rods," or "We will take ten per cent of the automobiles"? Why not come out in the open, lay the agreement before the board of transport commissioners and get it approved in the ordinary way? I cannot see anything in the position of that one boat that is different from that of any other boat which is being brought under regulation in the coastal trade of Canada.


Howard Charles Green: Is it the intention in this bill to prevent competition by that line of ships? I believe it is not one ship only, but different ships that are used; ships under charter are brought in and put on this work.


Clarence Decatur Howe: No. But we want competition in the open. We want all competitive factors applying the same rules. A ship at Vancouver can file with the board of transport commissioners any rate that it likes, and I have reason to believe that if it is the only ship plying there, the board will approve that rate. But the railways have a right to know what the ship is charging, just as the ship will have a right to know what the railway is charging. There will be the same publicity in both cases, and we shall not have the situation we have to-day, of a ship being able to shop around anywhere it likes with undisclosed rates, as against the railway which has full publication of its rates.


Richard Bedford Bennett: Can we do that in the case of a ship which is registered in another country,-a British ship registered in London, for instance?


Clarence Decatur Howe: A British ship entering the coastal trade must abide by the laws of Canada.


Richard Bedford Bennett: I know that.


Clarence Decatur Howe: A foreign ship cannot engage in the coastal trade.


Richard Bedford Bennett: I am referring to one
which would run from Vancouver to Montreal.


Clarence Decatur Howe: It is engaged in coastal trade if it runs between two Canadian ports, and it must abide by the laws of Canada. We have gone fully into that, and we find that such a ship is subject to regulation.
It is nearly six o'clock, and I believe I have said all that needs to be said at the present time. After the bill receives second reading, I shall ask that it be sent to the standing committee on railways, canals and telegraph lines, where it will have a most searching examination.


[Stage Direction]
Motion agreed to, bill read the second , time and referred to the standing committee i on railways, canals and telegraph lines.
At six o'clock the house adjourned, without question put, pursuant to standing order.
Thursday, March 24, 1938