Mr. SPEAKER:: In the name of the Honourable the Speaker of the Senate and in my own name, I would like to invite all the hon. members of this house to a ceremony which will be held in the main lobby of the parliament building, at 5.30 o'clock this afternoon.
His Excellency the Governor General, accompanied by the President of the United States of America, Harry S. Truman, will unveil the portraits of the two Prime Ministers of Canada who were at the head of our country during the two great wars: the Right Hon. Sir Robert Borden and the Right Hon. W. L. Mackenzie King.

The Prime Minister



THE PRIME MINISTER


[Stage Direction]
"Right Hon. IAN A. MACKENZIE (Minister of Veterans Affairs): Mr. Speaker, the Prime Minister has to leave about seven minutes after three o'clock to welcome a distinguished international statesman, the President of the great neighbour at our gates. Apart from these international courtesies which will be very close to our hearts, we have occasion to observe a national courtesy of the first order.
Today is a significant one in our history. As usual, I am at the side of the right hon. gentleman who today has been twenty years Prime Minister of the Dominion of Canada. We have our contentions here, our conflicts in debates, but on these larger occasions we are warm-hearted Canadians.
The Prime Minister is the dean of this house. He has enjoyed membership of this assembly for the twenty-eight years since 1919, with a few slight interruptions, and sat here for an additional period of three years, beginning in 1908.
May I leave with the house a practical way some of his record in the office of prime minister: From December 29, 1921, to June 28, 1926. 1,643 days; from September 25, 1926, to August 7, 1930, 1,413 days; from October 23, 1935, to the present hour, 4,249 days, a total of 7,305 days.
I must be brief. I wish I could speak longer, but I must not. The right hon. gentleman will pardon me, I think, if I mention four or five of the great inspirational influences in his life. The first was his beloved mother, born in exile, beside whose portrait in Laurier House there is an abiding light. The second was that old chieftain of Quebec, Sir Wilfrid Laurier. I shall never forget, sir, the last words the present Prime minister used when Laurier was dead, recalling precious memories. I cannot quote them all:
It is the old man with his bare head and his white hair, standing alone, fighting for the right as God gave him to see the right.
Again the inspirational voice of his illustrious grandfather, the rebel patriot of Canada:
Well may I love the poor; greatly may I esteem the humble and the lowly, for poverty and adversity were my nurses, and in youth were want and misery my familiar friends; even now it yields a sweet satisfaction to my soul that I can claim kindred with the obscure cotter and the humble labourer of my native, ever-honoured, ever-loved Scotland.
Another great influence in his life was Louis Pasteur. Most of us are familiar with just a word from a favourite quotation:
Two contrary laws seem to be wrestling with each other nowadays; the one, a law of blood and of death, ever imagining new means of destruction, and forcing nations to be constantly ready for the battlefield-the other, a law of peace, work and health, ever evolving new means of delivering man from the scourges which beset him.
Then in war, in 1939, most of us were here and remember the Prime Minister's words. I wish I could quote them all but I cannot. I remember that he said:
I never dreamed that the day would come when, after spending a lifetime in a continuous effort to promote and to preserve peace and good will in international as well as in industrial relations, it should fall to my lot to be the one to lead this dominion of Canada into a great war; but that responsibility I assume with a sense of being true to the very blood that is in my veins. I assume it in the defence of freedom -the freedom of my fellow countrymen here, the freedom of those whose lives are unprotected in other communities and countries, the freedom of mankind itself.
Victory crowned our efforts. With the consent of the house I am going back^across the ocean to Scotland for a moment, to quote some words from one of the poets of Scotland, Neil Munro, of Inveraray:
Though hails may beat us and the great mists blind us,
And lightning rend the pine-tree on the hill Yet are we strong, yet shall the morning find us Children of tempest all unshaken still!
One last word and I am through. Our distinguished leader has known the golden promise of the dawn, the full glory of the noontide hour, the conscious satisfaction resulting from great achievements in the afternoon of life; and now, sir, in the mellow twilight, we wish him continued happiness and health and many more years of devoted service to Canada which we love and which he loves so much.
Mr. JOHN BRACKEN (Leader of the Opposition):: Mr. Speaker, it is not given
to many men to be Prime Minister of Canada. Only eleven have held that position since confederation. The present Prime Minister is one of them. It is given to much fewer men to be Prime Minister of a democracy for twenty years. The right hon. gentleman has been Prime Minister of Canada for that long. As a matter of fact he has been Prime Minister of Canada for one-quarter of this nation's history. Whether he is to be blamed for one-quarter of the ills of all the people of Canada during that time I shall not discuss today, but I want it perfectly understood that I reserve the right to discuss it next week or next year.
On this occasion I want to express my congratulations to the Prime Minister upon
The Prime Minister

his long years of service to this country. One does not need to agree with the policies of a man in the position in which the Prime Minister finds himself today in order to pay his respects on an occasion like this. Twenty years is a long time. I can speak on that with some experience. In a rather smaller field it was my privilege to serve for more than twenty years, and when I left there were some who said that that was twenty years too long. I feel sure that there is nobody in Canada who would say that today about the present Prime Minister. I said nobody would say it today, but again I reserve that right to say what I think wise about it tomorrow or later.
I am very glad, Mr. Speaker, to have the opportunity of associating myself with those sitting with me in extending to the Prime Minister our congratulations on his long years of service. I am sure we all wish for him long life and much happiness in the days ahead.


Mr. M. J. COLDWELL (Rosetown-Biggar):: Mr. Speaker, we too of the C.C.F. party join in the good wishes that have just been extended by the leader of the opposition (Mr. Bracken) to the Prime Minister (Mr. Mackenzie King). We hope that he may yet enjoy many years of life and happiness. He has been Prime Minister for twenty years, one of the most challenging twenty years I suppose in world history. Indeed, when we think of the events since the first great war- the toppling of thrones, the rise of dictatorships, another great war, the elimination of dictatorships, the breaking up of empires- one realizes that the right hon. gentleman has been Prime Minister of Canada at the end of one of the great eras of human history. We join with all others in this house in expressing to him all our good wishes, and the hope that he may yet be spared to render service to our country.
Mr. SOLON E. LOW (Peace River): Mr. Speaker, I am glad of this opportunity to add a word of congratulation to the Prime Minister on this occasion. It is no mean achievement to serve as the elected head of Canada's government for a full quarter of the nation's history. No matter what we may think, as I have said on another occasion, of the horse which the Prime Minister has been on during all those years, we all have to admit that he made a hell of a good ride. No matter how we may differ in our views on the policies advocated by the Prime Minister, there are a good many of us in the house I suppose who would be very happy to learn just how he had managed to achieve

those twenty years of service, and at the same time how he had managed to keep his remarkable vitality through all the years since he first became Prime Minister. I wish to join with other hon. members in extending congratulations and sincere personal wishes to the right hon. gentleman.


Hon. ALPHONSE FOURNIER (Minister of Public Works) (Translation):: Mr. Speaker, in the absence of the Right Honourable the Secretary of State for External Affairs (Mr. St. Laurent), senior French-speaking minister in the present cabinet, I am happy to associate myself with those who have spoken before me in offering our most sincere congratulations and our best wishes to the Prime Minister on this happy anniversary.
We are assembled today to pay tribute to one of the greatest Canadians of all time. We are here to express our feelings of admiration, esteem and gratitude. For twenty years, Canada's Prime Minister. For twenty years, government leader of his country. We cannot help thinking of the studies, work and preparation represented in the achievement of such a career.
From early youth, the Prime Minister prepared himself by careful study, by meditation and travels in nearly every country of the world, for the post he has held for so long. While still a young man he became a member of the administration. A few years later he entered Sir Wilfrid Laurier's government. At that school, he increased his experience, developed his patience and qualified himself fully for the leadership of a great party. As soon as he entered parliament, he revealed himself an accomplished parliamentarian. His authority among party members and in parliament is beyond all question. He dedicated his life to the development of his country and to the happiness of his fellow countrymen. A tireless worker, he devoted his energies to the expansion throughout the world of his country's fame.
As peacetime leader, his administration was gratified with success after success. As wartime leader, he maintained unity among the various elements of our population, in the accomplishment of an admirable all-out effort which finally led Canada to victory.
Among our Canadian statesmen, he is probably the one who best understood the mentality, feelings and aspirations of my compatriots. He devoted his life to Canada's national unity, seeing the Canadian people as one group, without distinction of language, creed and customs. That is why he has enjoyed for such a long time and still enjoys the esteem and respect of my compatriots.

The Prime Minister
We shall never forget the unflinching confidence he placed in the French Canadians' sincerity during the historical and tragical moments which we experienced during the past few years. His understanding enabled our country to pass that critical period of our history without any clash, all to the best interests of the country. We have admired and supported him in the past and he may rest assured that his name will forever live in our hearts.
And when the time comes to write history, the Canadian people will unanimously recognize the unrivalled qualities of this great statesman.
Mr. L. 0. BREITHAUPT (Waterloo North) (Text): I realize, Mr. Speaker, that we are pressed for time, and I can assure you that my remarks will be brief and to the point. As the representative of the constituency of Waterloo North, the riding which first sent our illustrious Prime Minister to parliament, I cannot allow this opportunity to pass without paying a tribute to him for the splendid work he has done on behalf of Canada.
The hon. member for Peace River (Mr. Low) mentioned, I believe, that the Prime Minister rode a horse for a good many years. To that I might add that the horse started in a good riding, is the right kind of horse, and has come a long way. On behalf of the riding I wish to express to the Prime Minister our sincerest congratulations on this, his twentieth anniversary as Prime Minitser, and to express the hope that he may be spared for many more years of useful service.


Right Hon. W. L. MACKENZIE KING (Prime Minister):: Mr. Speaker, I wish I could begin to tell hon. members what it means to me to be surrounded today by those with whom I have been most closely associated in the work of government and in the work of this parliament, and to hear the kind tributes which have been expressed on this occasion. I know that hon. members will make allowance for some of the things which have been said much too generously. I can assure all hon. members that every word which has been spoken today will retain its place in my mind as long as memory itself endures.
I know that, in speaking of the twenty years I have been in the office of Prime Minister, a good many have said to themselves, "I do not know how to account for it." This comment has not been confined to those of any one party. I have heard that members of my own party have said the same thing
on occasions. I know that some hon. gentlemen opposite have said it repeatedly. I myself will not attempt to give an answer because I could not if I tried. All I wish to say is that, in looking back over those years and asking myself how it comes about that I should be speaking in this House of Commons to its members this afternoon, I can account for it, so far as my part may have contributed in any way, only by recalling what I owe to those whom my colleague the Minister of Veterans Affairs (Mr. Mackenzie) has referred to this afternoon, and to a few others whom he might also have named. I believe that for all of us the best that is in us comes from the past. After all, we only play our little part as a result of the sacrifices which have been made by others and for which we reap the reward. So I thank my colleague for having reminded me, the house and country, of those who are much in my mind and heart today.
To speak of my years of office, I think I can truly say that such good fortune as I have had in my present position has been due in large part to the ministers of the crown by whom I have been surrounded, to their great ability and great loyalty. It has been due also to the marvellously loyal support which I have received over the years from those who have been my followers and supporters in this House of Commons. It has been due also in large measure to the assistance which has been given to the work of the Prime Minister's office by members of the public service, the assistance which has been given by officials of this house and by many who are in very humble positions. Without their efficient service and loyalty it would be impossible for any one in an important position to perform his public duties. I do not forget either the kindness of my friends of the press. Though some of them may differ with me, many of them have given me loyal and helpful support, and all have given me the best of comradeship.
May I say to hon. gentlemen opposite that while I cannot thank them for the fact that I am still in office, and hope to be in office for a little while longer at least, I thank them most warmly for the courtesies which they have extended toward me in all the years I have been here. I think I have been particularly lucky in the friendships I have had among hon. members on all sides of the house. I shall always remember gratefully the kindness that has been shown me on many occasions by the other side of the house and never more so, may I say, than today. Above all, I do not
396S
The Prime Minister

forget at this moment what I owe to the confidence of the Canadian people over so many years. That is perhaps the greatest of all the rewards of public life and service.
Mr. Bracken, as leader of the Progressive Conservative party, I thank you very warmly for what you have said and for the hearty manner in which your words have been supported by members of your following. To you, Mr. Coldwell, may I say the same. I shall always remember what you have said, and equally the cordial manner in which those who sit around you applauded your words this afternoon. I thank you, Mr. Low, for your good wishes, and also for the generous support your followers have given your kind words. I thank you also for your reference to the political horse I have ridden over the years. My friend Mr. Breithaupt, who comes from the county in which I was bom and represents it so splendidly in this house, knows that I began quite early in life-I think it was perhaps before he was born-to ride a horse. I learned something about how to ride horseback personally and politically in the old. county of Waterloo. One of these days I intend: to return to the county which I first represented in this parliament and express my thanks for the teaching I received at that time, which has stood me in such good stead through all these eventful years. To my colleague Mr. Fournier, I am deeply grateful for reminding the country of how much I owe to my French-Canadian compatriots.
I should like, Mr. Speaker, to be able to express my thanks fully but you and all will realize I am sure that this is a moment when it is difficult indeed for me, after listening to what has been said this afternoon, no matter how long I may have been in parliament and in public life, to find words with which to express what is really deepest in my heart. I can only thank you, my fellow members of the House of Commons one and all; this I do irrespective of party; this I do with all my heart.
I hope I may be excused if I now leave the chamber. As my colleague the Minister of Veterans Affairs who is leading the house has just said, I am. to join His Excellency in meeting the President of the United) States and greeting him on his arrival. That will be in less than a quarter of an hour. Again I thank you all and. say God bless you.
REPORTS OF COMMITTEES Fourth report of standing committee on external affairs.-Mr. Bradette.
Third report of standing committee on agriculture and colonization.-Mr. McCubbin.
Fifth report of standing committee on standing orders.-Mr MacLean.



STORAGE OF BULLION BY MINING INTERESTS

Hon. DOUGLAS ABBOTT (Minister of Finance):: A short time ago the hon. member for Rosetown-Biggar (Mr. Coldwell) asked the following question:
In view of suggestions made in the house for the devaluation of the Canadian dollar or an increase in the price of gold, and Canada's need of American exchange, what action does the government propose to take regarding the storing of large amounts of gold bullion by the Mclntyre-Porcupine Mines Limited, or other mining interests who may be adopting a similar policy?
I have given very careful consideration to the problem raised by this question. There is no law on our statute books which specifically prohibits a gold mining company from withholding, or delaying to ship to the Royal Canadian Mint, a part or all of the gold currently produced by the mine. The only law relating to the subject appears to be subsection 2 of section 28 of the Bank of Canada Act, which was passed by parliament in 1934. Under this subsection, the governor in council is given power to require-
-every chartered bank or every other person to transfer to .the bank-
That is, the Bank of Canada.
-any or all gold coin or bullion held in Canada which is owned by such chartered bank or by such other person.
The subsection goes on to authorize the governor in council to take-
-all measures deemed necessary or expedient to enforce any such transfer and to impose and recover penalties in respect of any neglect or refusal to make any transfer so required.
I believe that the government could take action under this authority, if the situation appeared to warrant it. It might, of course, be urged that what the mines have been shipping to the mint in the past and what some of them are now storing is not gold bullion but, say, gold concentrates or gold in some other unrefined or partially refined form. However, this contention could hardly be successfully supported in most cases, and particularly in cases where the parcel deposited consists of gold which has been refined to a fineness of around eighty per cent.
There is, however, a rather serious difficulty or objection in applying the above provision of the Bank of Canada Act to the type of case which is now in question. This difficulty arises from the very severe penalty which has to be imposed when the provision is put in force. Section 29 of the Bank of Canada Act provides that where gold is transferred to the Bank of Canada under the previous section-

Storage of Gold
-the value of the said gold shall be computed on the basis established by the Currency Act at the date of the relevant transaction.
This means that if the governor in council required a mining company to transfer to the Bank of Canada the gold bullion which it is now storing, the price at which it would be taken over would be $20.67 per fine ounce, rather than the current price of around $35 per ounce.
This would be probably too drastic a penalty to impose in a case of the kind we are considering-too drastic, that is to say, unless the country's need for the gold was immediate and urgent. On the other hand, after serious consideration I have not been able to think of any amendment to these provisions of the Bank of Canada Act which I would be prepared to recommend at this time, because I can see that there may be cases arising in future where it might be appropriate to apply the present provisions of that act. With this in mind, I am not proposing any action on this matter at the present time. I am content to defer action for the time being because any gold that is stored by mining companies will be in a few hands; we will know where it is and approximately what it amounts to. We can therefore take it into account as in some measure a substitute for a part of our official reserves and, finally, if the need should arise, we will be in a position to have it transferred to the Bank of Canada under the legislative authority I have mentioned.
I cannot refrain, however, from expressing the hope that we will not see a continuance or extension under present circumstances of this practice of hoarding gold and thus not allowing the current output of this monetary metal to become an acknowledged part of the country's essential exchange reserves. As hon. members will recall, parliament itself has approved within the past twelve months the Foreign Exchange Control Act, to permit the conservation and control of the use of our foreign exchange resources, and under that act it is necessary for us to maintain restrictions on many types of capital transactions. If this were a world which was not suffering from the consequences of two great wars in one generation, it would probably be possible to permit complete freedom for companies and individuals to speculate in foreign exchange, foreign securities and gold. Unfortunately, it is not that kind of world. We simply cannot afford at present to see widespread speculation in foreign exchange and foreign securities, nor widespread speculation in gold, which is the equivalent of foreign exchange. In so far as we can secure the sensible cooperation of
business men and investors, it is possible to get along with a minimum of restrictions and controls. I trust that public opinion itself will be a potent force in determining what type of action is considered reasonable under given circumstances, and that that public opinion today will serve to a considerable extent to dissuade individuals or groups from attempting to make unproductive and speculative profits by exploiting the international difficulties that various countries face in these times.

On the orders of the day:


Mr. L. W. SKEY (Trinity):: Can the Minister of Finance give the house any assurance that Canadian gold mines will receive notice or warning before the threatened imposition of the Bank of Canada regulations are brought into effect against them?


Douglas Charles Abbott: I think the gold mines in question had better take my statement today at its face value and govern themselves accordingly.



PRIVATE BILLS


[Stage Direction]
Bill No. 273, for the relief of Eileen Maude Gardner Richards.-Mr. Maybank.
Bill No. 274, for the relief of Frances Audrey Gray Lacaille.-Mr. Maybank.
Bill No. 275, for the relief of Aline Theoret Larose.-Mr. Maybank.
Bill No. 276, for the relief of Margaret Betty Rollings Burman.-Mr. Maybank.
Bill No. 277, for the relief of Beatrice Dorothy Pountney Alker.-Mr. Maybank.
Bill No. 278, for the relief of Margaret Jean Duff Dorval.-Mr. Maybank. *
Bill	No.	279,	for	the	relief	of	George
Somerville Blackie Begg.-Mr. Maybank.
Bill	No.	280,	for	the	relief	of	Lillian
Guerasio Galardo.-Mr. Maybank.
Bill	No.	281,	for	the	relief	of	Stewart
Davidson Myles.-Mr. Maybank.
Bill No. 282, for the relief of Dorothy Bradford Hurley.-Mr. Maybank.
Bill No. 283, for the relief of Elsie McCormick Albers.-Mr. Maybank.
Bill	No.	284,	for	the	relief	of	George
Wilson Dyce.-Mr. Maybank.
Bill No. 285, for the relief of Rita Johnson Cherrier.-Mr. Maybank.
Bill No. 286, for the relief of Esther Cole Zeesman.-Mr. Maybank.
Bill No. 287, for the relief of Celia Yaffe Dubinsky.-Mr. Maybank.
Inquiries oj the Ministry
[Stage Direction]
Bill No. 288, for the relief of Elsie Mariya Garayt Johnson.-Mr. Maybank.
Bill No. 289, for the relief of Leone Rhea Leduc Metcalf.-Mr. Maybank.
Bill No. 290, for the relief of James Arthur Abiett.-Mr. Maybank.
Bill No. 291, for the relief of Goldie Slovinsky Tkatch.-Mr. Maybank.
Bill No. 292, for the relief of Harold Fassett Staniforth.-Mr. Maybank.
Bill No. 293, for the relief of Clair Morgan Lockner Middleton-Hope.-Mr. Maybank.


[Stage Direction]
On the orders of the day:
Mr. T. A. KIDD (Kingston City):: Mr. Speaker, I should like to ask a question of the leader of the house. Why has the union jack been discarded from the flag pole today, and why is it not flying on any of the three flag poles, either on top of or in front of the parliament buildings? Who is responsible for giving instructions as to what flags should be flown?
Right Hon. IAN A. MACKENZIE (Minister of Veterans Affairs): I believe my colleague the Minister of Public Works could answer that question better than I can.


Alphonse Fournier: Mr. Speaker, in 1945, right at the close of the war, an order in council was passed stating that the red ensign would be flown on public buildings. I did not expect this question today. However I can say that I believe the officials of my department have followed the order in council passed at that time. That would explain why they have put the red ensign on all public buildings.


Thomas Ashmore Kidd: I should like to ask a supplementary question. Does the minister realize that when Mr. Churchill was here the union jack was on the right and the Canadian ensign - to the left? When General Montgomery was here the Canadian ensign was on the right-


Some hon. MEMBERS:: Question.


An hon. MEMBER:: That is a speech.


Thomas Ashmore Kidd: I am asking a question. When General Montgomery was here the Canadian ensign was on the right and the union jack on the left.


James Horace King: I understand the hon. member has put his question and has received his answer.


Mr. J. H. HARRIS (Danforth):: Mr. Speaker, with respect to your ruling, the 
Minister of Public Works has not answered the question completely. He, himself, sir, suggested he was answering only with regard to the Canadian ensign in the top position. He has not answered that portion of the question which had to do with flags flying either to the right or the left of the Canadian ensign. My question, supplementary to the one asked by the hon. member for Kingston City, is this: Why is not the union jaek flying in some place, somewhere, inasmuch as there are three positions which are recognized today, namely the Canadian ensign in the centre position, with one to the right and the other to the left? With due respect, sir, I should like to have an answer with regard to the two other official positions for flying the flag.


Mr. MacINNIS:: Mr. Speaker-


Thomas Ashmore Kidd: Let him answer.


Alphonse Fournier: I can only repeat that the officials of the government are following the terms of the order in council passed in 1945. I believe that order in council was tabled in the house and was explained by the Prime Minister (Mr. Mackenzie King) at the time. Furthermore a committee of the House of Commons sat for a session or two to try to find a distinctive flag for our country, and the report which came back to the house recommended the red ensign. On all our buildings we are flying either the union jack or the red ensign. If hon. members will read the order in council they will see that wre are justified in flying the red ensign over public buildings.
I am answering in an impromptu fashion, because I had no notice of the question. However if the hon. member wishes me to make a further statement I shall study the matter and make another report later.


Joseph Henry Harris: Mr. Speaker, on a question of privilege, as a member of this honourable chamber for over a quarter of a century, and having read the history of Canada since confederation-


Some hon. MEMBERS:: Order.


James Horace King: Order.


Joseph Henry Harris: On a question of privilege; I have some rights, and I propose to exercise them-with all due respect to you, sir, and the usages of this honourable House of Commons. We did give way in 1945 to the ensign, with the union jack, on every occasion.


James Horace King: Order.


Joseph Henry Harris: I asked-

Inquiries of the Ministry


James Horace King: Order. I am sorry to interrupt the hon. member, but that is not a question of privilege. He will understand that I have permitted him to ask his question, but I cannot permit a debate on the matter. The hon. member for Vancouver East (Mr. Maclnnis)-


Alphonse Fournier: Just one second; I recall m this House of Commons that hon. members of the party opposite moved a motion that the red ensign be the national flag of Canada. I cannot see why they object when we fly it.


Joseph Henry Harris: I do not wish to debate this matter, but on a question of privilege, sir, I asked the minister a question, not about the red ensign which is at present flying over the building, but about the flags which are flying to the right and left. And I make this statement, that never before since confederation has this honourable house sat under flags which did not include the union jack.


Mr. MACKENZIE:: It does include the union jack; the union jack is part of our red ensign. Do you realize that?


James Horace King: The hon. member for Vancouver East.



IMMIGRATION


[Stage Direction]
-PRESS REPORT AS TO SELECTION-DUTCH IMMIGRANTS
On the orders of the day:
Angus MacInnis: Mr. Speaker, I should like to ask a question of the Acting Minister of Mines and Resources arising out of a comment appearing in the Globe and Mail of today respecting the statement the minister made yesterday in the house. The press report states that employers will be allowed to select persons in displaced persons camps and bring them here under contract. Would the minister care to make a statement on that point?


Right Hon. C. D. HOWE (Acting Minister of Mines and Resources):: Immigrants will
be selected by the immigration branch, with the advice and counsel of the Department of Labour. Where the Department of Labour gets its advice is for the Department of Labour to determine. I can see no objection should the advice be taken of people who will later agree to employ these displaced persons in a particular industry. But I should like to make it clear that the selection will be made by the immigration branch.
While I am on my feet I should like to answer a question asked yesterday by the hon. member for Peel (Mr. Graydon). I can now advise him that one thousand Dutch immigrants are sailing for Canada on June 17 of this year.


Mr. N. J. M. LOCKHART (Lincoln):: Mr. Speaker, I should like to ask a supplementary question in connection with Dutch immigrants. Can applications be received under the usual circumstances? I have received letters stating that they have been definitely turned down. Is there any provision prohibiting the entry of Dutch immigrants, or are they as free to come in as persons of other nationalities?


Clarence Decatur Howe: Dutch immigrants are free
to come in under the rules governing immigration. Under the government movement, Dutch immigrants are screened by the immigration branch. If they come forward and are found healthy and otherwise suitable for emigration to this country it is quite within their privilege to come to Canada. How fast they can be moved depends upon shipping. As I say, the first movement of one thousand will take place on June 17, which is next week.


Mr. GRAYDON:: Have these thousand Dutch immigrants had farm experience? If so, how will distribution be made throughout Canada?


Clarence Decatur Howe: I have not the background
in this type of movement which would permit my answering the question. It is my understanding however that many applications have been received for the employment of those included in the movement. Whether the applications are being filled in the order in which they are received, I cannot say. However I shall be glad to make a statement on that point later.


Mr. DESMOND:: May I say that if there is any confusion regarding immigrants from Holland and if there is any question about their acceptance, they are all quite acceptable in Kent county.



P.E.I. CAR FERRY

[Stage Direction]
INQUIRY AS TO DATE ON WHICH S.S. "aBEGWEIT"

[Stage Direction]
On the orders of the day:
Mr. W. CHESTER S. McLURE (Queens): Mr. Speaker, arising from the announcement made yesterday, as to the date of the christening ceremony of S.S. Abegweit, I now wish to ask an all-important question of the
[Stage Direction]


Inquiries oj the Ministry
Minister of Transport. Will the minister state when the S.S. Abegweit will take over the Borden-Tormentine ferry service?
Hon. LIONEL CHEVRIER (Minister of Transport):: Just as soon as it possibly can, after the naming ceremony.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. G. H. CASTLEDEN (Yorkton):: I should like to ask the Minister of Veterans Affairs what action has been taken to protect the interests of Canadian veterans who are members of the veterans taxi owners association of Montreal.
Right Hon. IAN A. MACKENZIE (Minister of Veterans Affairs): I should like to make a statement on that question as soon as possible, but I have not the file before me now. I want to say at once that the Department of Veterans Affairs has nothing whatsoever to do with the activities of the veterans taxi owners association of Montreal, except that a former employee of the department got mixed up with the activities and he was immediately dismissed.



INQUIRY AS TO REQUISITIONING FOR UNITED KINGDOM CONTRACT

[Stage Direction]
On the orders of the day:
Mr. G. J. TUSTIN (Prince Edward-Len-nox):: Yesterday an announcement was made by the Minister of Finance that the price ceiling had been removed on all agricultural products-


Douglas Charles Abbott: Dairy products.


George James Tustin: -and I should like to ask the Minister of Agriculture if it is the intention of the government to requisition the entire make of Ontario cheese for the United Kingdom contract. If so, will it be taken at the floor price?


Right Hon. J. G. GARDINER (Minister of Agriculture):: I do not know of any intention on the part of the government to requisition cheese this year.



INCOME WAR TAX ACT

[Stage Direction]
The house resumed from Monday, June 9, consideration in committee of Bill No. 269, to amend the Income War Tax Act-Mr. Abbott-Mr. Macdonald (Brantford City) in the chair.

On section 12-Private companies.
Mr. TIMMINS:: Will the minister explain subsection 2?


Douglas Charles Abbott: As the explanatory note points out, the amendment to subsection 2 is consequential upon the amendment to subsection 1 which allows a private company incorporated after 1939 to elect to pay the special tax under this part of the Income War Tax Act. It is a purely consequential amendment in order to bring subsection 2 in line with subsection 1 as amended. I have a further amendment, to add a subsection 5 to this section, which I will ask my colleague to move.


Mr. McCANN:: I move:
That subelause three of clause 12 of Bill 269 be amended by adding after subsection four therein contained the following subsection:
"(5) Where a private company pursuant to the winding up of another company received property in any form in respect of which it was not subject .to tax under this act but in respect of which it would have been subject to tax if section nineteen of this act had been in force at the time it received the property, the private company may, at its option, include in its undistributed income for the purposes of this part of the lesser of
(a)	an amount equal to the amount in respect of which it would have been so subject to tax, or
(b)	an amount equal to the amount by which the value of all property in any form received by it pursuant to the winding up exceeded the value of the consideration given by the private company for the shares of the other company in respect of which the said property was received by it."


Mr. FLEMING:: Explain.


Douglas Charles Abbott: This is to cover a case which was overlooked when the original section was drafted. It was found that, there were certain companies which, had they continued in their former state, could have qualified and elected under the provisions of the section. However, they had been reorganized and assets of the former company were transferred to the new company, but there was a substantial identity between the original company and the successor company. It was considered equitable that company No. 2, if it cared to do so, could avail itself of the provisions of the section, and this new subsection is being put in to enable it to do so.
The committee will realize that these provisions will lapse on December 31 of this year. It was suggested that these so-called private companies should be enabled to pay tax at the rates stipulated on their undistributed surplus. As the committee realizes, the

Income War Tax Act
provisions are pretty technical and in the practical application it was found that there were certain cases which in equity would be entitled to the benefit of the amended provisions and which on one technical ground or another were excluded. The amendments this year are designed to cover cases which it is considered should properly be covered.


Donald Methuen Fleming: Company No. 2 in the instance given by the minister is to be given the option provided by the legislation which was consequential on the report of the Ives commission.


Douglas Charles Abbott: That is it exactly.


[Stage Direction]
Amendment agreed to.
Mr. JACKMAN:: I do not like to trouble the minister at the moment, but this section refers to a private company. The interpretation section of the Income War Tax Act refers to a family corporation in paragraph (d) of section 2 and a personal corporation in paragraph (i). I have had some difficulty in distinguishing just what is meant by the interpretation section, and we now have a private company. I wonder if the minister, either now or later, would care to give the committee a succinct definition of these three different forms of small private or family companies so that we may have it clear in our minds?


Douglas Charles Abbott: The family corporation is no longer of any great practical significance, because the special tax provisions relating to family corporations were repealed some time ago. The personal corporation is a type of corporation defined in the Income War Tax Act. I have not the section here, but broadly speaking it is a company with just a few shareholders which is controlled by an individual or by members of his family, and I think it is 75 per cent or 85 per cent of its revenue must be derived from interest or dividends on securities and the like. The income of the company is taxed in the hands of the shareholder in proportion to the number of shares held. This so-called private company, as used in this section, applies simply to the type of company which was dealt with by the Ives commission in its report, and colloquially it might be described as a company with closely held shares. The requirements in the suggested amendment are that the company should not have more than seventy-five shareholders. That definition is a modification of the provisions of the Companies Act, which states what will constitute a private company for the purposes of the Companies 83166-253J
Act and thereby relieve the company from obligation of filing a prospectus or a statement in a prospectus.
I explained on introducing the resolutions on which these sections are based that in a good many cases, as a result of deaths and distribution among heirs, there are companies which are private companies within the intent of this legislation which have sold more than fifty shares, so we decided to extend it to seventy-five. There is nothing sacramental about the rule of fifty, except it happens to be the number which is set out in the Companies Act. That is a pretty general statement as to what constitutes a private company. There is no special legal significance to the term "private company" except under the Dominion Companies Act and except with respect to this particular legislation.


Harry Rutherford Jackman: As far as income tax is
concerned has the family corporation classification any significance now? There are no such family corporations?


Douglas Charles Abbott: That is correct. There are a few companies which may still have some income which was accumulated under the family corporation provision, but I think it has mostly been distributed. The provision with respect to electing to be treated as a family corporation expired in 1942.


[Stage Direction]
Section agreed to.
On section 14-Tax in respect of dividends from a private company, etc.
Donald Methuen Fleming: I should like to ask the minister to give an explanation of this section. It is becoming very confused and involved. It is, without doubt, as difficult to follow as anything I have ever seen for some time. In explaining the effect of the section will the minister have in mind the impression that some of the provisions create, that in fact there will be retroactive taxation here?


Douglas Charles Abbott: I realize these sections are very complicated. I found the greatest difficulty myself in working them out and in understanding them as drafted, although for over twenty years I have had experience in looking into sections of this kind. This particular section, which will be section 97 in the act, is to plug a loophole in the provisions of the act. I issued a press statement back in January pointing out what this loophole was, and stated that I proposed to introduce an amendment at the present session of parliament to plug it. Perhaps it would be as easy as any other way for me to explain it if I were to read into the record the statement I made at that time, and then I can elaborate

Income War Tax Act
on it if my hon. friend wishes. I said I proposed to introduce certain amendments to the Income War Tax Act of a somewhat technical nature affecting private companies. I said that although not many taxpayers would be affected by the amendment, I thought that those who would be concerned should be informed. I now quote from the statement:
The purpose of the amendment is to prevent legal avoidance of tax on distributions of accumulated surpluses of private companies electing to pay tax under part XVIII of the act in cases where persons have purchased their shares from corporate owners since December 31, 1914. Where the shares of the private company are acquired by the individual on or after January 1, 1947, the dividend paid out of accumulated surplus will be taxable in the hands of the individual at the rates that would have been paid by the private company in respect of the surplus represented by the shares in question if the present owner had been the actual owner on December 31, 1944. If the shares were purchased in the calendar years 1945 or 1946 the dividend will be taxable when received by the individual but at a rate of 15 per cent.
The reason for that was this. As my hon. friend will appreciate, dividends from one Canadian corporation to another are exempt from tax. Take a private company which had individual shareholders and corporation shareholders. It could elect and could qualify as a private company under this section. It elects to be taxed on the basis of part XVIII. The tax is calculated at the appropriate rate as income of the company on the proportion of the income of the company or proportion of the surplus of the company attributable to individual shareholders; but since the cor-)orate shareholder would pay no tax on the portion of the income which was going to him, the total tax paid by the private company to which I referred would be less because of having corporate shareholders. Then, step No. 2. If an individual acquired the shares of that corporate shareholder or private company he could get the dividend from the private company tax free. It is to plug that hole that this amendment is introduced.


Donald Methuen Fleming: I thank the minister for his statement. The committee appreciates ihat there is a fairness about the proposal, but the feature which troubles me, and which I think has not been fully clarified by the minister is this. Simply because the warning was given in January of this year it is treated as a ground for imposing the tax now. But there may be people who acquired their shares prior to the date of the warning, and acquired them with knowledge, presumably, of the fact that the shares at that time were free of this particular type of tax. The tax is now being extended in 1947 although the individual sought to be taxed now may have purchased

them prior to the date of the warning. No doubt in most cases he purchased them prior to the date of the warning, understanding, and being entitled then to understand, that the shares were free of tax on the proportion of undistributed surplus in the hands of the company. It looks to me like a retroactive tax, which is not a desirable kind of tax.


Douglas Charles Abbott: One answer to my hon. friend is this, and that is why we made the difference between the two rates which were imposed here; the 15 per cent rate, which is the minimum under the schedule in section 92, applies to such cases as took place in 1945 or 1946. In the future the regular rates which are set out in the schedule apply.


Donald Methuen Fleming: Would it not be better to make it apply from this point on instead of going back?


Douglas Charles Abbott: No; I really feel that that would be unjustified.


Harry Rutherford Jackman: I do not quite understand the minister's reasoning where the tax avoidance is if the corporation gets the distribution from the private company, it being a shareholder. When it receives the income it will go into the earned surplus of the receiving corporation, and then when it is paid out, as it must be some time if anyone is to benefit from it, the shareholders must ultimately pay the tax.


Douglas Charles Abbott: I perhaps was not quite clear in my explanation. What happens is this. The individual buys the shares from corporation No. 2 before the dividend is paid out. That is where I was incomplete in my explanation. An individual buys shares of a private company from this other corporation before the dividend is paid out, and he receives the dividend tax free.


[Stage Direction]
Section agreed to.
On section 15-Paragraph A of first schedule.
Harry Rutherford Jackman: There is nothing new to it in principle except what was said in the budget debate; but as the minister has said, and everyone in Canada believes, the rates of advance on taxation are much too quick, and this schedule is must too fast in its rate of advancement; after SI,500 a man pays an extra 2 per cent, I think it is, upon every $100, so by the time he reaches a taxable income of $2,000 he will be in the 20 per cent bracket. I merely wish to go on record again as saying I think that is too high a rate of

Income War Tax Act
progression if the government wishes to stimulate the best activities and the utmost production in the country.


[Stage Direction]
Section agreed to.
On section 16-Deductions allowed corporations refining or marketing petroleum.
Mr. ARGUE:: An oil company is allowed to deduct from income the cost of exploration, even it if strikes a dry hole; why is the farmer not allowed to deduct from income the expense of digging, a well, even if he finds no water?


Douglas Charles Abbott: The short answer would be that this is incentive legislation to stimulate in Canada the search for oil, which is a badly needed raw material.


Hazen Robert Argue: So is water.


[Stage Direction]
Section agreed to.
Section 17 agreed to.
On section 10-Regulations.
Douglas Charles Abbott: The hon. member for St. John-Albert raised the question last night that the provisions of this section might be interpreted in a very much broader fashion than I had thought possible, and I said at the time that if he was right the section should be amended or withdrawn. The purpose of the section is to endeavour to provide a flexible workable basis for administering the Income War Tax Act. What we are trying to achieve is an act which will be readily understandable and which will work fairly for all taxpayers. For that purpose it is necessary to give a certain amount of flexibility to the act. We are trying to eliminate the straight ministerial discretion, and in cases where flexibility is necessary we want to incorporate a provision whereby regulations will be adopted by the governor in council, which will of course require approval by the cabinet. The regulations will be published in the Canada Gazette and I hope would be available in brochure form for the use of all taxpayers.
Paragraph (3) (a) provides:
The governor in council may make regulations not inconsistent with this Act.
(a) prescribing the evidence required for any purpose under this Act.
That is pretty broad in its terms. I consulted the law officers of the crown this morning. They do not believe it could be interpreted as widely as my hon. friend suggested last night, but I think we should put the question beyond peradventure and state just what the intention is. As I said last night, this is intended to relate only to the administration of the act as such. The evidence required would be in regard to such matters as establishing charitable donations, dependency, and so forth. Suppose a man claims he has a dependent living in Europe. He should not be held to the strict rule of best evidence, but the department should be able to require that an affidavit be evidence of dependency if accompanied by money order receipts to show that payments were made regularly. That is the sort of thing we had in mind.
Paragraph (3) (b) reads:
(b) requiring any class of persons to make information returns respecting any class of information required in connection _ with the administration or enforcement of this act-
And so forth. I discussed this with the officials of the Department of National Revenue, and they find that in the enforcement of the act they require information from different classes at different times in rather different forms, and it is hard to spell that out in advance in the act. They feel that there should be some flexibility and that regulations should be made, which could be made known to all taxpayers, so that the rules could be varied from time to time. They feel that it is not desirable that we should attempt to spell the whole thing out in the statute. With that in view I think the objections that were taken last night might be met by amending the section in this way:
That clause ten of Bill 269 be amended by deleting the words "for any purpose under this act" where they appear in paragraph (a) thereof and substituting "to establish facts relevant to assessments under this act" and by deleting the words "the administration or enforcement of this act" where they appear in paragraph (b) thereof and substituting the words "assessments under this act."
In other words, prescribe what character of evidence may be accepted by the department, and what type of information may be asked for, relating only to assessments under the act. I suggest to the committee that that is a reasonable provision and that it will make for efficient administration of the act. If it is found that it is abused, and I do not think for one moment that i't will be, the question could be raised in the house and an appropriate amendment insisted upon, but I suggest to the committee that the section as I now propose it and which I will ask one of my colleagues to move in a moment is an appropriate and a workable section.


Mr. HAZEN:: I think the suggested amendment clarifies the matter to a very great extent, and so far as I understand it now it is acceptable.


Donald Methuen Fleming: I should like to say a word about the proposed amendment to clause (b). I can appreciate the points raised

Income War Tax Act

by the minister, and I also appreciate his willingness last night to take these objections into consideration and review the section. Such an attitude on the part of the minister is something we welcome on this side of the house. We do not see enough of it on the part of ministers in the house.
But as to the amendment proposed by the minister I do say again, as I said last night in connection with another section, that the proposal of the minister is in some form or another to codify, first of all, the evidence to be prescribed under paragraph (a), and also the rules attaching to the filing of information by classes of persons under paragraph (b). It is a task that has to be done some time and it ought to be done here in parliament. It ought to be as easy for us to do it here as for the minister or the governor in council to do it. The minister says that it is desirable to have some flexibility, that more frequent changes are necessary than are possible with legislation. But I wonder whether with these long sessions of parliament there is any great danger of hardship arising if it is left to parliament to do the legislating. I want to offer this word of caution and warning. It is far too easy for any minister or any member to allow himself to get into this frame of mind: We want flexibility; let us not tie ourselves down too tightly; give power to the governor in council to make regulations. I do not think, Mr. Chairman, that that is a sufficient reason for leaving it to the governor in council. I think the task of parliament is to legislate clearly and to legislate sufficiently. A codification of the matters referred1 to by the minister will be helpful, but my point is that the body that ought to be doing that kind of legislating is parliament and not the' governor in council.


Douglas Charles Abbott: With a good deal of what my hon. friend has said I am in sympathy, but I think he and all hon. members who have had experience in these matters will agree that in an act like the income war tax act it, is essential that power be given to make regulations which in effect become a part of the statute. In other words there is a certain .type, of legislation where, if the thing is to work efficiently and if parliament is to get through its work, parliament must lay down certain general principles and there must be a certain flexibility allowed whereby regulations can be made. It is a matter of opinion where the line should be drawn between those two points of view. That is where my hon. friend and I may differ. I feel quite strongly from the experience I have had that in a case of this kind the flexibility 
should be achieved by conferring upon the government of the day the power to make regulations. Remember that the minister in whose department the regulations are made is responsible through the government to this parliament and the country.
As I said a moment ago, I feel that administrative regulations of this kind which are widely publicized, which should be made known and would be made known to all taxpayers, can be made the subject of burning criticism in this house if the executive has presumed to go farther than it should go. In drafting this act and the bigger act which I hope to bring in a little later in this session, all I am interested in is to achieve a sound, workable and understandable tax law which we can make known to the people generally. I believe that one way to do that is to have the act lay down the broad general principles-in considerable detail, it is true-and then have fairly extensive power by the governor general to make regulations, which, of course, must be publicized, but which can be readily changed from month to month if the circumstances of the administration of the act demonstrate that it is desirable to do so. I am hoping that when I bring in my big bill my hon. friends will see that there is a considerable degree of that in the act. I am trying to get away from those purely ministerial discretions and put in something by regulation which will be the tax law, to which the taxpayer can have recourse and which the courts can interpret and rule on, which is not the case with ministerial discretions. That is what I want to get away from as much as possible. I honestly believe that this is a power which should be given to the governor general to exercise by regulation. I see that my hon. friend differs from me to some extent on that point; and that, of course, is a matter of opinion. I should like to see this section given a trial. As I say, it is perfectly open to any member of the house to come here and show that any regulation made is unjustified and demand that it be changed.


Harry Rutherford Jackman: That is not good enough.


Donald Methuen Fleming: I do not wish to prolong the debate, but I should like to mention two things about the statement which the minister has just made and which I appreciate. First, so far as the power to make regulations is concerned, I think the minister has ample powers now under subsection 2 of section 75. We are not taking away from him anything which he now has, in saying what we have said about the proposed new subsection 3.

Income War Tax Act


Douglas Charles Abbott: The minister may make regulations, not the governor in council. I am going a little farther in this section.


Donald Methuen Fleming: Probably that is another case where some improvement could be made in the new big bill.
With regard to the subject matter of paragraph (b), this is a matter of giving power to the governor in council to direct persons to make information returns which bear, not necessarily on their own assessments, but on the assessments of other people. Everybody wishes to see the government clothed with sufficient power to make sure that all persons who are properly taxable do pay their taxes. But after all, parliament has always proceeded, as I understand it, on the theory that the decision to compel people to make returns is an important matter and it has always done that by legislation. There are sections in this income tax act which require persons to make returns; such provisions are always in the form of legislation. It seems to me that this is a new departure, in clothing the governor in council with power to direct persons to make returns.


Douglas Charles Abbott: I do not wish to prolong this debate either. I am informed that there are fairly wide discretionary powers under the British act to make regulations for returns of this kind, although I have not seen it. I would suggest to the committee that we give this a try; and if when the larger bill comes in, it is still felt that it is objectionable, when we are considering it next year we could repeal the section. I feel certain there will not be any abuse. As my hon. friend himself has said, it is put in solely for the purpose of seeing that the provisions of the taxing act ire fully and fairly administered and that no one gets away without paying his just share of tax; because, if he does, somebody else aas to pay it. That is the only purpose oehind the section. It is not to try to give oureaucrats, so-called, any additional powers :o go around harassing people for returns which they should not make.


[Stage Direction]
Amendment agreed to.
Section, as amended, agreed to on division.
Douglas Charles Abbott: Mr. Chairman, if I can do so under the rules, I should like to reopen a section which has already been carried. I refer to section 9. In that section, as the committee will recall, we extended to the smaller cooperatives-that is, cooperatives whose income did not exceed $2,000-the privilege of not making instalment payments of
their tax because of the difficulty of knowing early in the year what their patronage dividends would be; they were exempted from that provision. Since the section was passed last night, I have had representations from the secretary of the cooperative union and from some others to the effect that that amount is rather too low; that it would involve a tax of only some $600. Therefore, with the permission of the committee I should like to ask one of my colleagues to move that the $2,000 figure be increased to $3,000, which would be roughly equivalent to a tax on such small cooperatives of $1,000.' As a result of discussion with those who are familiar with these matters, I am told that they believe that will be reasonably satisfactory. In any event, we will try it out over this year, and if it is not satisfactory I would be quite receptive to the suggestion of increasing the amount by a further reasonable figure. However I think it will be found to be sufficient.


The DEPUTY CHAIRMAN:: In order to reconsider section 9, it will be necessary to have a motion that the committee revert to it.


James Joseph McCann: I move that the committee revert to section 9.


[Stage Direction]
Motion agreed to.
On section 9-When amount of income is $2,000 or less.
James Joseph McCann: That section 9 of Bill 269 be amended by deleting the words "two thousand dollars" where-ever they appear therein and substituting the words "three thousand dollars."


Mr. FULTON:: Just before the amendment carries, I should like to ask the minister, if it would not be abusing a confidence on his part, whether the request was made specifically for $3,000 or whether it went beyond that amount? In other words, why stop at $3,000?


Douglas Charles Abbott: It went beyond that. The original request made by the association was for a tax of $2,000. I felt that was really too much because it would be equivalent to a taxable income of $7,000; and it seemed to me that a cooperative with a taxable income of that size should be able to estimate pretty well in advance. This is a special arrangement for smaller cooperatives which do not keep their books in quite the same way, and which, I am informed, find some difficulty in estimating, early in the year, what their patronage dividends were as a deduction from income. I was told this morning by these people that this amended figure which I am
Income War Tax Act

suggesting will work out pretty well. As I say, if it does not, we will look into it again next year.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
William Henry Golding: Shall the
title carry?


Douglas Charles Abbott: There is not any title.


Mr. HANSELL:: The minister will recall
that I had an interview with him a few weeks ago. I am bringing this matter before parliament now so that, if possible, it may be discussed by members who represent farming constituencies. I do not bring this matter before parliament by way of criticism. I had a courteous interview with the minister, and in order to open the matter up for discussion he suggested that I might ask him the question on the floor of the house. It was with respect to the manner of collecting farmers' income tax. During the Easter recess I had a delegation of farmers wait on me asking if it would not be possible for farm income tax to be deducted at the source. I recognize that this might involve many intricate matters of administration, but I do not think it would be impossible to carry it out.


William Henry Golding: Order. I
would call the hon. member's attention to the fact that it is out of order to discuss these matters now, when we are dealing only with the title. If the hon. member has the consent of the committee to discuss these points, I am in the hands of the committee; but I make this observation because someone else might want to discuss the same or another matter, and it would be out of order.


Douglas Charles Abbott: May I ask my hon. friend
if this was a discussion he had with me or with my colleague the Minister of National Revenue?


Ernest George Hansell: No, it was with the
Minister of Finance, here in the chamber.


Douglas Charles Abbott: Probably when my hon.
friend gets a little further along with it I will recall it, but at the moment I cannot remember that particular conversation.


Ernest George Hansell: I am afraid it could not have made much of an impression upon the minister, though he even promised me that he would refer the matter to some of his officials.


Douglas Charles Abbott: As the hon. gentleman
goes along a little, I may remember it, but so many hon. members speak to me that my memory is not as good as it might be.


Ernest George Hansell: As a matter of fact I think I have stated my case. I recognize, Mr. Chairman, that it is a little odd to discuss this matter on the title, but this bill is with respect to income tax and it contains nothing covering certain particular situations. I believe there is also a matter with respect to resolutions of the farmers' union, to which the minister said he would reply. The delegation that waited upon me seemed to think this tax deduction at the source could be carried out, and. they advanced a good many arguments in favour of their position. Certain deductions are now made, not for income tax purposes but for other reasons. For instance, certain deductions are made for the administration of the Prairie Farm Assistance Act. This indicates that it is not impossible to make deductions at the source. I should like the minister to give some public reply to the request. He is nodding his head; evidently he now recalls the discussion. I know he is a very busy man; I know any finance minister having the administration of this country's financial policy has tremendous responsibilities, especially under this system.


Some hon. MEMBERS:: Oh, oh.


Ernest George Hansell: I am not going to enter upon that discussion, though I notice the finance minister has moved, a little farther away from this comer of the house since last night. I hope, that is not too significant.


Douglas Charles Abbott: That is just because they put the chairs here.


Ernest George Hansell: Then perhaps the minister would reply now.


Douglas Charles Abbott: First, I must apologize to my hon. friend. I now remember clearly our discussion. I was a little confused as to what question my hon. friend was raising, but a moment later I realized that he was referring to the suggestion he made that farmers' income tax should be deducted at the source in somewhat the same way that deductions are made from salaries and wages. I did discuss that matter with the officials and also with my colleague the Minister of National Revenue; but, as regards the farm population generally,
I am afraid it would be administratively impossible. It might and perhaps would work in the case of a farmer who is raising only one crop, such as wheat, and selling it all at a given point; but, for a man engaged in mixed farming, I am told, and I believe, that from a practical point of view it would be almost impossible to operate the same system as is followed in connection with salaries and wages. If it could be done I am sure nothing would

Income War Tax Act
please my colleague the Minister of National Revenue better than to get it while the getting was good; but I am told it is not practically feasible.
In the course of the debate the hon. member for Battle River and, I think, the hon. member for Acadia also referred to representations made to me by representatives of the Alberta farmers' union, and I said I would reply to those questions at a later stage. I remember very well the discussion I had with representatives of that organization, who submitted to me an extensive brief with a series of recommendations. The hon. member for Battle River mentioned most of the points in the course of his remarks the other evening. Some of them I find are matters for my colleague the Minister of National Revenue, and he will reply to those in due course; I understand he is prepared to give answers on those points. But there are some which concern my own department.
The first request was for a four-year averaging of income in place of the present three-year averaging. For reasons which I believe I have already given in this house, I did not consider that I could recommend this change.
The second point was one which we discussed at some length the other evening; that is the question of the proceeds of the dispersal sale of live stock.. I mentioned yesterday evening that this question is receiving, at the moment, particularly active consideration by the Department of National Revenue. I understand that some of their officials are now in western Canada discussing this matter, and I have been given reason to believe that a statement of the policy considerations which will govern in those cases will be arrived at very shortly.
One of tlhe other suggestions was a request for higher personal exemptions generally. I have discussed that point on one or two occasions during the course of this debate, and I do not think I can add anything more at present to what I have already said.
There was also a recommendation that farmers be relieved of the responsibility for deducting income tax from farm wages. Here again I was forced to conclude that we could not properly relieve formers from an obligation which is imposed upon all other employers with regard to tax deductions.
The suggestion was also made that we should allow as a charge against current income the payment of debts incurred in previous years. In this case also I think I gave my reasons earlier in this debate as to why I do not think a proposal of that kind would
be equitable. Of course, as hon. members will realize, the present system of averaging, in connection with farmers' incomes, goes a long way toward evening up for tax purposes the varying results of different years of operation, and I do not think I am prepared to go any farther at present than is provided in the existing law.
I think I have covered the points raised by the hon. member for Battle River as far as they relate to my own department. Some of the other points may perhaps be more properly dealt with by my colleague the Minister of National Revenue.


Mr. FAIR:: I should like the Minister of Finance to go right through the fourteen recommendations made by the two farm organizations and deal with those coming within his department, and then the Minister of National Revenue to deal with the remainder.


Douglas Charles Abbott: I can do that; I did it with the delegation when they were here. I went through the list, point by point. I have covered those which relate to my own department, but I can go through the list; I have the brief in my hand. The fourteen recommendations were as follows:
1.	Four-year average for income tax purposes. I have already dealt with that.
2.	Dispersal sales of live stock. I have dealt with that.
3.	The raising of exemptions. I have dealt with that.
4.	Allowance for labour of farm families in connection with production on the farm. I dealt with that yesterday evening.
5.	No further responsibility for income tax on farm wages. I dealt with that a minute ago.
6.	Board of arbitration on income tax cases. There is an appeal board, and I do not think any further boards should be set up.
7.	That payment of arrears of interest and principal on the home farm, due before 1940 be allowed as deductions for income tax purposes. I dealt with that a minute ago.
8.	Provision for final clearance to all taxpayers within two years. That comes under the Department of National Revenue.
9.	No special exemptions to any class but full provision for proper expenses. That is an excellent generalization, with which I heartily agree.
10.	Simplification of income tax forms. That is the Department of National Revenue.
11.	In computing net worth statements over the years 1941 to 1945 the increase in value
Income War Tax Act

of live stock and implements which has come about through the general advance in prices should be discounted and an equal amount of this property valued on the same basis per unit for both years. That is a national revenue matter.
12.	Uniformity of interpretation and administration of the income tax act. It should not be left to the discretion of district inspectors to vary the provisions of the act. That is national revenue.
13.	Brushing and breaking of new land should be considered as a current expense. That is national revenue.
14.	Money expended in drilling or boring wells or excavating dugouts on the farm together with all equipment for same should be chargeable as a current expense. That is national revenue. It is a question of whether it is capital or revenue expenditure.
Those are the fourteen points.


Harry Rutherford Jackman: There is another point.


James Joseph McCann: Perhaps I might be permitted to deal with two or three of the points the Minister of Finance missed.


Douglas Charles Abbott: I refer it to your skilful attention.


James Joseph McCann: This afternoon the hon. member for Wood Mountain raised a point in connection with section 16, with reference to money expended in drilling or boring wells or excavating dugouts on the farms, together with all equipment for those operations, with the suggestion that it should be chargeable as a current expense.
Such expenses are inherently of a capital nature and, in accordance with recognized accounting principles in the case of business and entrepreneur classes in general, would be capital expenditures and not a deduction from income. However, it has been the practice of the division for simplicity of administration to allow such expenditures as a charge to income if they do not run into any substantial sum. Relatively shallow wells which are apt to go dry fairly quickly and not costing more than $250 to S300 are usually allowed as an item of expense in the year in which made, rather than spread over the two or three years of the possible life of the well. This also applies to the ordinary run of dugout. However, large deep wells and large dugouts would naturally have to be treated in their proper category as capital expenditures. I believe that affords rather generous treatment to farmers, and that perhaps it meets the wishes and demands of the hon. member who raised the question.


Hazen Robert Argue: Is depreciation allowed on the wells?


James Joseph McCann: No, there is no depreciation for wells. There might be a windmill which went into it.


Mr. JOHNSTON:: Is there not a ten per cent depreciation?


James Joseph McCann: The next recommendation is that the brushing and breaking of new land should be considered as a current expense.
In point of fact, casual and incidental brushing and breaking are usually accepted as a current expense. A major piece of work sometimes involving twenty or thirty dollars an acre for a considerable area is obviously a capital expenditure just as would be the brushing and clearing of land for a new airport or new factory. Expenditures on the development of land are frequently of considerably more value than the amount of the actual outlay, and it is only fair that the amount of such expenditures should be charged to capital. It is not only fair but in keeping with universally recognized accounting principles.
The special allowances which were made to those engaged in drilling for oil were a wartime measure based on the nation's then desperate need for gasoline for military use. These were exceptional measures for conditions of exceptional national danger.
The third recommendation is with respect to the uniformity of interpretation and administration of the income tax act, and the suggestion that it should not be left to the discretion of district inspectors to vary the provisions of the act.
No-evidence has been forthcoming to show that the directors of the district offices do, in point of fact, vary the provisions of the act, but in the administration of thousands of cases in which there may be widely varying circumstances the directors and their assessors must naturally be allowed to use their own judgment to a reasonable degree. Overly rigid rules would be more likely to work injustices to individual taxpayers than the situation under which responsible officers are given some freedom to interpret in a reasonable and logical way the broad principles laid down for their guidance.
It is quite possible that in a limited number of instances some differences of interpretation may arise on relatively minor points. To keep such differences at a minimum, however, meetings have been held from time to time among the officials charged with this work

Income War Tax Act
both in Ottawa and at other principal centres, and this procedure will be carried out to an increasing extent in the next several years.


Robert Fair: Have not instructions been issued to assessors in the different administration districts?


James Joseph McCann: Yes; directives go out to the district offices in connection with many types of work. Those go to the head of the administration in the district, and if they concern the assessors they are passed on to those assessors.
May I add, in connection with the assessing of farm returns, that we have received many letters from farmers commending the procedure which has been taken with reference to our attempt to keep farmers informed as to the regulations, the methods used in assessing, and) the type of return we would ask them to make.
Let me say frankly that there has been more criticism in the House of Commons than there has been from the farmers about the assessment of farmers. That may be quite natural-


Robert Fair: The farmers are not here to
speak for themselves; therefore we have to represent them. On April 14 I asked for a copy of the instructions issued to the assessors, but-


James Joseph McCann: I had intended to say
what the hon. member said, namely that the farmer cannot be here to speak for himself. Rut I seldom hear a good word said for the income tax branch by the representatives of the farmers. It is for that very reason I bring to the attention of hon. members the letters of commendation from farmers throughout the country which have been received.


Robert Fair: Perhaps the minister would
table those letters.


James Joseph McCann: If you are going to speak, then I will sit down. If not, let me continue.
I have had letters from Mr. Northfield, our representative in Edmonton. He is the district inspector out there, and he tells me that the assessors are sent out to the different parts of the country where public meetings are called. At those meetings information is given to the farmers as to the type of return we would like to have them put in. They are told how to keep something bearing a resemblance to books from which they may tell from year to year what their position is. The consensus from the farmers, as indicated by the letters I have received, is that the inspector and the assessors have been well received. The department has been commended for the action it has taken in giving out that information and helping them to make their returns.
That is not a condition which obtains in only one or two districts; it is one which is found generally throughout the whole of the western provinces.
To conclude my statement with reference to the uniformity of interpretation and administration of the income tax act, it is pointed out in the directive that, apart from what I said earlier, the head office endeavours, by correspondence and by methods of supervision, to keep the interpretations as uniform as possible. It is to be remembered, however, that it rarely happens that the facts of two cases are actually identical even where at first sight there is a considerable degree of similarity.
I think a good deal of the criticism with reference to returns made by farmers and assessments arises from the fact that the department have not done enough educational work in the farming communities to indicate to farmers that they as well as any other class should pay the tax as long as it is the law of the country. We are going to endeavour to clear up that situation by continuing these meetings in certain districts. All our farmers are excellent citizens, and I think they will see the point that they should make a contribution through income tax as well as any other taxpayer.


Robert Fair: I believe I have been one who has criticized the department as much as anybody else-


William Henry Golding: When the hon. member for Macleod rose I called the attention of the committee to the fact that it would be out of order to have a general discussion on the title. The hon. member for Macleod was permitted to proceed and then the ministers made their statements. I am in the hands of the committee but actually there should be no general discussion on the title.


Douglas Charles Abbott: It was agreed last night that certain information which had been asked for, particularly by the hon. member for Battle River, should be given after we had concluded discussion in committee of the sections of the bill. I think that information has been given as fully as the Minister of National Revenue and I can give it. There is no section before the committee; there is no bill before the committee; we have completed our work in committee.
Income War Tax Act


Robert Fair: I asked the minister some questions on the resolution stage and it was impossible for me to discuss those questions until I got the answers. I feel that I should have a couple of minutes now. If I do not take time now, I can take it on third reading, so that it is up to the committee entirely.


William Henry Golding: As I say, the Chair is in the hands of the committee.


Douglas Charles Abbott: I have no objection, but I think the discussion should be restricted to comments by the hon. member for Battle River upon the questions which he asked me and to which I have just given him answers.
I do not think we should reopen this whole debate. Perhaps his position is fair since I asked him to permit a delay in getting the answers to his questions, but I suggest that we should not open up the whole discussion.


Robert Fair: I wish to thank the minister, particularly for saying that my position is fair. I believe it is fair. As one of those who have criticized the administration of the income tax legislation, not because of the income tax itself because I believe that, as far as taxes go, the income tax is one of the fairest that can be levied, I feel I should say something. I am not in favour of the present levies or the present exemptions, and I want to make that definite and clear.
I want to commend the Department of National Revenue for having instructed their inspectors to attend meetings for the purpose of educating the farmers. Earlier in the discussion I advocated radio addresses or perhaps the putting out of a booklet by either the Department of Finance or the Department of National Revenue giving farmers instructions along these lines. That would help to clear up a lot of the misunderstanding and perhaps hard feelings which exist.
On April 14 I received a return in reply to a question which I had asked in connection with instructions issued: to assessors of farm income tax during each fiscal year from 1939-40 to 1945-46. This return contains brief information. One set of instructions dealt with the transfer from cash to accrual basis and the other one dealt with wheat participation certificates. Those were issued in 1943-44 and 194445. I do not believe I have been given all the information for which I asked. If instructions have been sent out to the different officers, perhaps the Minister of National Revenue could at his convenience, supply me with copies for the years mentioned.
The question of uniformity of administration came up, and I think we have had evidence enough from the different administrative

districts to show that there is no uniformity of administration. In connection with brushing and breaking new land, I am quite satisfied that if a farmer undertakes to break twenty, thirty, forty or fifty acres of land that expense should be allowed in the year in which it is incurred, Unless that breaking is done, he cannot produce any crops. As I pointed out when dealing with this matter before, if the farmer hires help during the year to do that work there is no question about those wages being allowed:, but if he hires a contractor to come in and do the work, then the department sees fit not to allow that expense. I feel that any expense incurred in a particular year for the clearing or breaking of land should be allowed as a current expense for that year.
I am not going to say anything more at this time because quite a little time has been taken up, but I should like to ask the Minister of National Revenue one question. Will there be sent out to the different administrative districts instructions which will line up with the discussion we had- here yesterday and today in connection- with, farmers' income tax?


James Joseph McCann: Yes, we will see to that.


Mr. KNOWLES:: Has consideration been given to changing the name of this act?


James Joseph McCann: That is in the new act.


Mr. SMITH (Calgary West):: May I say one sentence which may perhaps be a bit out of order? I am sure the minister will be glad to hear what I am going to say. I want to tell the committee that four oil wells are in active production in the Leduc field. They have established- a front of three and- a quarter miles in length, with an open flow of roughly one thousand barrels apiece. They are now producing roughly one hundred barrels apiece on a choke of from three-sixteenths to three-eighths of an inch.
Bill reported.



EXCESS PROFITS TAX ACT, 1940

[Stage Direction]
Hon. DOUGLAS ABBOTT (Minister of Finance) moved the second reading of Bill No. 270, to amend the Excise Profits Tax Act, 1940.
Motion- agreed to on division, bill read the second time, and the house went into committee thereon, Mr. Goldiing in the chair.
On section 1-Minister may direct standard profits to be ascertained by board of referees where profits from a business substantially different.

Income War Tax Act
[DOT] 3983
Donald Methuen Fleming: The minister has gone part way to meet the views which some of us expressed in the resolution stage concerning the proposed deadline for the filing of SP-1 applications. Instead of the deadline being fixed at August 1, it is now proposed that it be fixed for general purposes at September 1, and there is a further exception. I should like to make an observation or two about the exception. The explanatory note at the bottom of page 2 reads as follows:
The amendments in this subsection give effect to paragraph two of the resolution which provides "That no taxpayer shall be entitled to make application for determination of his standard profits on or after August 1, 1947." The final date for application has, however, been extended to September 1, 1947, and special provision has been made for taxpayers who, by reason of first becoming liable to pay tax on excess profits did not find it necessary prior to that date to have their standard profits ascertained.
As I read the new subsections 4, 6, 7 and 8, they deal with the generality of applications. In subsection 9 provision is made for an exception which is described in the note as follows:
Exception-where taxpayer may compute his standard profits or make application for determination by the board.
I appreciate the fact that the minister has gone part way, but I urge that when the tax is to continue until December 31 of this year, in the case of those who may come within the new capital or reclassification provisions of the present section 5 of the act, a prohibition of the filing of any application to ascertain standard profits should not be imposed while the tax is still being incurred. With the tax coming off on December 31' of this year, will the minister not agree to allow the filing of such applications up until at least December 31 of this year when the tax is to be removed, in the special cases to which I have referred? As I mentioned when I spoke on this matter on the resolution stage, I can see that it is quite fair, provided that ample warning is given, to fix a deadline for the filing of applications in the case of persons claiming to have a depressed business or to be engaged in a depressed class of business; but it seems to me that these other cases should not be assimilated with the cases of which I have just spoken.


Douglas Charles Abbott: I think every case is actually covered here. Take the case of the company which has been in the excess profits tax bracket and should have filed its return, got its material in and had its standard pro-83166-255
fits ascertained. We ask that the application be put in and the relevant data submitted before September 1. I do not think it is unreasonable in the case of this company that it should do that. In the case of companies that have losses or low profits during the period up to this date, or in the case of new companies, they are under the provisions of the proposed section as amended since the resolution stage. All they have to do is give notice prior to September 1 that they intend to make application to have their standard profits fixed, and they have ample time after that to get their material in and have it completed. That covers the case which my hon. friend referred to the other day, of the new company or the company which had never had occasion to come in and have a standard profit fixed.
The case to which he has referred, that of a change in capital, or an increase in capital, is automatically taken care of. Section 4 deals with increase in standard profits. One
does not have to go to the board of referees to have his standard profits changed. In case of capital changes during the fiscal period ending December 31, 1947, the standard profit is automatically adjusted to take care of the increase in capital, or the decrease in capital if decrease there be.
I discussed this matter with the officers of my own department and the Department of National Revenue, and I am satisfied that there will be no hardship in the section as now proposed.


Donald Methuen Fleming: I should like to make one further request to the minister. The decision having been made to proceed on this basis, will the minister take reasonable steps to see that warning is given to the public? I know that a directive has been issued on this subject on the basis of the resolution. It went into certain publications received by chartered accountants. I know it also went to many lawyers; I saw it in "Ontario Weekly Notes" recently. I would think that a newspaper advertisement would be justified in a case of this kind to warn companies which may be affected and which may not be served at the present time by solicitors or chartered accountants.


Douglas Charles Abbott: I agree that the provision should be widely publicized and we shall see that that is done.


[Stage Direction]
Section agreed to.
Sections 2 and 3 agreed to.
[Stage Direction]


Income War Tax Act
On section 4-No tax on profits earned on and after January 1, 1948.
Mr. PROBE:: Before this section carries, will the minister tell us whether in the field of corporation tax anywhere the department considers it necessary to adopt the principle of ability to -pay in connection with taxation? I should like to refer him to the fact that in the personal income tax field the rates are made progressively steeper as the income of the individual rises. So far as I can see, no such principle is recognized in differentiating between small and large corporations. I am, of course, personally opposed to section 4 and do not wish to see the excess profits feature removed from taxation. But apropos of this, will the minister give us some indication if and how the factor of ability to pay, which I think is a recognized principle, is applied in the field of corporation tax?


Douglas Charles Abbott: Of course the corporation tax field is a big one. When you tax a corporation as such you are taxing a legal person. It is really a tax on what would otherwise be distributed to the shareholders, and to that extent it may be regarded as a double tax. There has been a good deal of discussion in the house and elsewhere that we should try to work out a system analogous to the English system whereby a certain standard tax is deducted by the corporation arid - then the taxpayer takes credit for that in his own personal tax return. Our system follows the system which was established in the United States and, except for the so-called excess profits tax during the war, it has taken the form of a flat percentage tax of the company's net income. In a sense, that does not take into account ability to pay because the corporation is a corporation; it is not an individual. When the shareholder gets his dividend, then the progressive feature comes in and the shareholder pays his tax.
If I remember correctly, in the proposals which were put out in connection with the suggested agreements with the provinces it was indicated that if and when agreements were made with all provinces it would be possible to make some revision of the corporation tax structure, but the progressive feature is not a feature of the corporation income tax structure. The obvious answer is that a good many wealthy men own small companies and a good many poor men own Shares in big companies. As my hon. friend appreciates, this question of the taxation of business or

corporation profits is a complex one and it is hard to say where the final incidence of the tax will fall


John Oliver Probe: The minister referred to the fact that our corporation tax structure is based on that of the United States.


Douglas Charles Abbott: Not based on it, but
similar.


John Oliver Probe: There is one important point of difference. In the United States the principle of capital gains is adopted, whereas with us capital gains are disregarded entirely. Would the minister care to express an opinion on introducing that feature into our field of income taxation?


Douglas Charles Abbott: That is a very large question. It has always been foreign to the British conception of an income tax. Some of us may remember during the days of the depression that it has disadvantages, and I have never been able to see great advantages. It has always seemed to me that a capital gains tax lent itself to methods of evasion which I personally am not very much in sympathy with.


[Stage Direction]
Section agreed to.
Bill reported, read the third time and passed.

[Stage Direction]
Hon. DOUGLAS ABBOTT (Minister of Finance) moved the second reading of Bill No. 271, to amend the Special War Revenue Act and to change its title to the Excise Tax Act.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Golding in the chair.
Sections 1 to 3 inclusive agreed to.
On section 4-Tax on railway, et cetera, ticket.
Donald Methuen Fleming: I have a question with regard to the last clause on the page reading:
The governor in council may -reduce the rate of tax imposed by subsection one of this section or abolish the said tax -as he may deem expedient.
The explanation given in the explanatory note is:
The new subsection 9 is designed to permit the rate of the transportation tax to be kept parallel to the corresponding tax in force in the United -States, if deemed expedient.
If it is expedient that the tax in Canada be equated with that in the United States, surely we can have a more definite statement

Special War Revenue Act
from the minister as to the government's intention than appears in the explanatory note.


James Joseph McCann: When the United States revised :ts transportation tax considerable representation was made by the transportation companies that, unless Canada did likewise, the travel agencies and the transportation companies would probably lose considerable revenues, because people who wanted to make transatlantic, transpacific or South American journeys would probably purchase their tickets in the United States in order to avoid the Canadian tax.
The intention of this section is to exempt journeys to Europe, Asia, South America, and Australasia, from the last point in Canada or the United States where the vessel or aircraft stops to discharge or take on passengers, but intervening transportation would be taxable. That is. if a person bought an air line ticket from Winnipeg to Prestwick, Scotland, and the point in Canada from which the aircraft took off for direct overseas flight was Dorval, then the portion of the ticket from Winnipeg to Dorval would be taxable. Similarly, if a passenger travelled by rail and vessel from Winnipeg to Liverpool, embarking at Halifax, the rail journey from Winnipeg to Halifax would be taxable.
Provision has also been made to empower the governor in council to reduce or remove the tax if it is found necessary so to do because of similar action taken by the United States. It may perhaps be explained that transportation companies, travel agencies and the like, find that a difference in the tax rate causes considerable fluctuation in the purchase of tickets in Canada and United States if the rates of tax are not parallel. This is to enable us to bring the tax rates into conformity with each other.


Donald Methuen Fleming: If this section is adopted will it be applied in such a way that, if changes are made in the United States tax, the Canadian excise tax will be changed in parallel fashion?


James Joseph McCann: This is to give the government power to meet conditions which might arise when the house is not sitting if there were a revision in the United States rate. This gives us power to revise our rate.


Donald Methuen Fleming: That does not answer my question. If the section passes may we take it from the statement made by the minister that, if changes are made in the United States tax, parallel changes will be made ip the Canadian tax?
831 CO-255$


James Joseph McCann: We would not necessarily obligate ourselves to do that. It would be taken into consideration, and the government would have the power to do it.


[Stage Direction]
Section agreed to.
Sections 5 to 11 inclusive agreed to.
On section 12-When taxes payable.
John Oliver Probe: My remarks will apply to both sections 12 and 14. Under section 12, the excise tax on certain commodities, wines I believe, are paid at the time of sale by the Canadian manufacturer. The effect of section 14 is identical because it refers to the collection of a consumption or sales tax of eight per cent on the sale price of all goods. Generally speaking, I think both excise and sales taxes are collected from the manufacturer on the invoice which he presents to the jobber or to the retailer. The effect on the consumer of this form of taxation is that there is a pyramiding of costs on the sales and excise tax portion, thus affecting the final cost of the commodity. With an eight per cent sales tax, I am quite certain that the ultimate consumer pays twelve to fourteen per cent on an article on which the government realizes only eight per cent. Since this is a consumer's tax, it enters into and is an important feature in the cost of living. Why is it that the Department of National Revenue or the Minister of Finance could not consider collecting both excise and sales tax at the last point of sale-[DOT] that is, in the hands of the retailer-instead of in the hands of the manufacturer, and making it eight per cent at that stage, if he must- although I oppose that rate-or whatever rate the government decides is adequate! Then it would seem to me that at the same time it might be desirable to use a system of stamps placed on the goods to show that the taxes have been paid, as in the case with playing cards, matches and the like. The present form of taxation gives the government a good deal less revenue than is actually paid as tax by the consumer. It differs in that respect from the income tax where the amount paid by the income taxpayer is net to the taxpayer and the cost of collection is a cost borne by the government. But in the case of excise and sales taxes, the cost of collections is an expense added to the tax and borne by the consumer. Has the government given some consideration to the practicability of what I am now suggesting? What administrative flaws are there in levying the tax in the way I suggest rather than at the manufacturer?. I believe that it would result in more revenue to the govern-
Special War Revenue Act

ment, using exactly the same rate of taxation. Would the minister care to comment on that?


James Joseph McCann: There would necessarily be grave difficulties if such a system as that advocated by the hon. gentleman were followed in that, instead of dealing with a limited number of licensees, you would have to deal with an almost countless number.


John Oliver Probe: By the use of a form of revenue stamps, it would seem to me that would be obviated.


James Joseph McCann: All of that costs a good deal of money. As one example, I might state to the hon. gentleman that the removal of an imprint upon an excise stamp which was used on tobacco saved the government $40,000 in a year. From that it can be seen how quickly costs of that type would run up and pyramid. With respect to the pyramiding of the sales tax, that is not nearly as much in effect now as it was some years ago.


John Oliver Probe: The minister has stated that the sales tax levied at the manufacturer's place of disposal, where he passes it on to the jobber or to the retailer and the invoice will have the eight per cent added, will not pyramid the sales tax. I do not believe that statement is correct.


James Joseph McCann: Not as much as it did because of competitive conditions which obtain now and which did not obtain before.


Mr. HERRIDGE:: I have knowledge of firms which have gone bankrupt and which have collected sales tax from individuals, but the government did not receive any of it. What is the department doing to protect itself in those cases?


James Joseph McCann: The position is this. In the case of any firm which goes bankrupt and owes sales tax to the government, the government is one of the creditors and shares with the other creditors.


Mr. PINARD:: A privileged creditor.


Herbert Wilfred Herridge: Is that trust money?


James Joseph McCann: We are in an in-between position. We are between the creditors who have privilege or priority and the common creditors. We come before the common creditors. Every attempt is made to collect as much as it is possible to collect of money owing to the crown.


Herbert Wilfred Herridge: Will the minister inform the committee how much has been lost by the department with respect to that kind of thing?


William Henry Golding: Shall section 12 carry? Carried.


Mr. STIRLING:: No, Mr. Chairman. A question has been asked.


James Joseph McCann: The hon. gentleman is
entitled to an answer. I do not know how much has been lost, but we have figures on what has been collected.


John Oliver Probe: Has the minister collected
the $40,000 odd which was owed three years ago by Caledonia Farms when they went bankrupt? That was an Ontario meat-packing firm and it owed the Department of National Revenue some $40,000 or $41,000. Was that collected?


James Joseph McCann: Although I do remember
the case I do not recall the figures in connection with it. We could get that information for the hon. gentleman.


[Stage Direction]
Section agreed to.
Sections 13 and 14 agreed to.
On section 15.
Donald Methuen Fleming: I wish to ask a question
with reference to subsection 3 of section 103. The effect of the section would be to give the minister power to grant exemptions from the licensing provisions of the act. In what cases is it intended that this power of exemption should be exercised, and what is the reason for it?


James Joseph McCann: That would have to do
with small manufacturers," people who are in the cosmetic business, people manufacturing handbags and things like that in their own homes, who have not established a place of business for that work entirely; it is a sort of side-line and the amounts involved are small.


[Stage Direction]
Section agreed to.
Sections 17 to 28 inclusive agreed to.
James Joseph McCann: I just wish to make this
statement. This bill appears to have gone through rather hurriedly. There are no great changes in the act besides the fact that it implements the changes founded on the resolutions under the budget. The Whole idea of bringing in this Special War Revenue Act and of changing its name to the Excise Tax Act is in order to simplify it, consolidate it and put in their proper position those portions of the act which have to do with the same thing, such as licences, penalties and the like of that. It has been more or less a tidying-up process so that the act is much more easily referred to and much more easily read.


William Henry Golding: Shall the
title carry?

Veterans Affairs


Mr. ROSS (St. Paul's):: Apropos of the
statement made by the minister, is one of the reasons for changing the act to get away from the idea of calling many of these things luxury taxes? I judge there is to be no change in the luxury taxes?
Mr. MeCANN:	There are no changes in
any of the taxation in this act.


Douglas Gooderham Ross: I was suggesting
that this luxury tax we are talking about, such as the tax on alarm clocks, flatware and so on, will stay on for some time. Is that the idea? Or does the minister propose to nake some change shortly, revamping the tax on luxuries, as we call them?
Mr. MeCANN:	That is not within my
province. That belongs to the Minister of Finance. We do nothing with reference to the changes except see that they are properly and honestly administered.


[Stage Direction]
Title agreed to.
Bill reported, read the third time and passed.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.
[Stage Direction]
veterans' affairs-veterans' taxi owners

[Stage Direction]
Hon. PAUL MARTIN (Minister of National Health and Welfare) moved that the house go into committee of supply.
He said: Mr. Speaker, the house will recall that on Friday last it was agreed that we would call two new departments on going into supply. The first item that I suggest be called is No. 366, of the Secretary of State.
Mr. G. S. WHITE (Hastings-Peterborough):: Before you leave the chair, Mr. Speaker-


Mr. MARTIN:: If the hon. gentleman has anything to discuss, in view of the peculiar conditions prevailing this evening, perhaps it would be better to let the matter stand. It was agreed that we would go on with the estimates of the Department of National Health and Welfare, and in view of the fact that members of the ministry are otherwise engaged it would seem to me that if the hon. gentleman has no objection we should not proceed
with the question he has in mind. Perhaps in view of the circumstances he might agree with me in that.


George Stanley White: In reply to the remarks of the minister I would say that the matter I wish to bring up is the one I raised last Thursday, with which I was not allowed to proceed. On Friday evening the leader of the house indicated that if we reached supply on Monday we would take national health and welfare, and agriculture.
Yesterday afternoon we did not reach supply, nor did we reach it by eleven o'clock. Then the Minister of Veterans Affairs (Mr. Mackenzie), in giving the business for today, said he hoped to bring in the two departments he had expected to get in the day previous, and two more. If that is correct, that will leave only one or two departments still to come in.


Paul Joseph James Martin: No; it will leave five more. These two will make fifteen, and that will leave five others still to come.


George Stanley White: Even so, the opportunities yet to be afforded hon. members will be very few, and the matter I wish to raise, after trying to do so last Thursday in the proper way and being prevented from doing so, in my view is important. It became my intention to take advantage of the first opportunity to bring up that matter on going ino supply. I expected that opportunity yesterday, but it did not materialize, so that this is my first chance to do so. It is to be regretted that the Minister of Veterans Affairs is not, here, but in my view the matter I wish to discuss is urgent and should be brought before the house as soon as possible. Therefore, with all due respect to what the minister has said, I should like to proceed.


Paul Joseph James Martin: I am sure the hon. gentleman will permit me to interrupt once more. I appreciate that the point he wishes to raise is, in his judgment, an important matter, but I would point out to him and to the house that at Rideau Hall a dinner is being held tonight in honour of the President of the United States. It is only proper that members of the government should be at that dinner; and among those in attendance is the senior privy councillor other than the Prime Minister (Mr. Mackenzie King); that is, the Minister of Veterans Affairs. In view of the well known chivalry of my hon. friend, I would respectfully suggest to him that his point could be raised the next time supply is called for the purpose of bringing in another department. In the circumstances, in view
Veterans Affairs

of the fact that the ministers, I think properly, are out of the house, I would ask him to raise his point then. Thirteen departments have been called; it is suggested that two more be called tonight, which will leave five yet to be called, so that the hon. gentleman will have ample opportunity. I would ask him to be good enough to accede to my request.


Mr. MacNICOL:: On a point of order, Mr. Speaker, the hon. member has every right to proceed if he wishes to do so.


Mr. DEPUTY SPEAKER:: No point of order has as yet been raised.


Paul Joseph James Martin: This is just a request; there is no doubt about his right.


George Stanley White: In reply to the request of the hon. gentleman, and in view of the kindly way in which he has referred to me, I would remind him of what took place in the house last Thursday. In my opinion the matter I raised was urgent, and was not something that could be ruled out because it was before the courts. On that occasion some of the hon. gentlemen who sit around the Minister of Health and Welfare did not extend very much courtesy to me. However I would say to the minister that if he would undertake to have supply called tomorrow, not at half-past ten or a quarter to eleven o'clock tomorrow night but tomorrow afternoon, to give me an opportunity of raising the matter I have in mind, I should be glad to accede to his request. I realize that the Minister of Veterans Affairs is not here tonight, and I should be pleased if he were here when I make my statement. But I should not like the matter to go over until next week, or anything like that. If the minister will say that he will arrange to have supply moved tomorrow afternoon I shall be very happy to let the matter stand.


Joseph Henry Harris: Just before the minister replies, perhaps I may be permitted to make one or two observations. In the first place, I am a little stunned by the suggestion of the minister that the hon. member for Hastings-Peterborough (Mr. White) might show a little more chivalry. I say to you, sir, and, through you, to the members of this house, that no other individual in this chamber during the last twenty years has exuded as much chivalry as seems to flow from the hon. member who has just taken his seat. As one who does not intervene very often in the debates in this house, I am sorry my hon. and good friend the minister should have let slip that suggestion.
[Mr Martin.]
In the meantime, what is a day? Speaking as an ordinary member of this House of Commons, I quite appreciate why the Minister of Veterans Affairs (Mr. Mackenzie) and the other members of the privy council are absent tonight. They have a right to be absent; they should be where they are, and I am sorry the minister finds it necessary to remain here to represent the government. I am sorry he is charged with the responsibility of trying to get a couple more departments into supply. The function being held elsewhere this evening has the commendation and endorsation of the entire membership of this house and the populace of the Dominion of Canada, but at the same time I hold this reservation. For the sake of a miserable little period of twenty-four hours the government of the day should not seek to force this house to deal with the matter of these additional departments. So I plead for the house to give consideration to the position of the hon. member for Hastings-Peterborough, who, though
I.	suppose not shut off summarily, nevertheless was definitely prevented from introducing a matter which to him was of great moment; more so, perhaps, than to the member for Danforth, because the hon. gentleman knew what he was introducing, he knew the boys on whose behalf he was making the plea, and he had fought with them overseas, which was not the privilege of some of the rest of us.
With respect to all the considerations bound up in this particular question, I ask, through the representative of the government tonight, that he just give us another twenty-four hours, and we will bring the matter in, in an orderly fashion, without any disruption of routine in the carrying on of the business of parliament. Today one of the highest honours has been paid to this nation of only 12,000,000 people by the representative of perhaps 120,000,000 people. So, skip it for twenty-four hours; and, to use the language of the street, let us get on with the government's business tonight.


Paul Joseph James Martin: I am sure the hon. member to whom I directed my remarks in the first instance did not misunderstand the suggestion I made, and it was because I knew him so well that I felt at liberty to make that suggestion. Since the minister of the department concerned is not in his seat, I do suggest that my original request be acceded to, and I will undertake to make arrangements so that the hon. member will be given sometime in the course of the next few days an opportunity to raise his question.


George Stanley White: I thank the minister, but I do not like the last few words he used-"the next few days". I ask the minister if he will just state that he

Unemployment in Maritimes
will call supply either tomorrow afternoon or at eight o'clock tomorrow night, and I shall be happy to accede to his request. But if the minister wants to leave it to some time in the next two or three days, then I regret saying that I would have to go on. If he will say that an opportunity will be permitted tomorrow afternoon or tomorrow night, that will be all right. I do not think I am being a bit unfair.


Paul Joseph James Martin: I will undertake that, for either tomorrow night or the next night.


Some hon. MEMBERS:: No.


Paul Joseph James Martin: I do not know what the
plans of the house are for Thursday. But the hon. member's original request was that it be within two days.


George Stanley White: No, my request was that we have it tomorrow.


Paul Joseph James Martin: I will undertake to do my best for tomorrow night and, if not tomorrow night, then the next day. I want to be absolutely fair.


George Stanley White: I
am not being difficult with the minister, but he can easily arrange to have it tomorrow afternoon or tomorrow evening.


John Ritchie MacNicol: The minister knows
about Thursday.


Paul Joseph James Martin: I was wrong about Thursday. There is no supply on Thursday.


John Ritchie MacNicol: Then, what is the minister deciding to do-to allow the hon. member to go on tomorrow some time?


Paul Joseph James Martin: Yes, I will do my very best. I wish to be fair with the house. I dislike undertaking something I cannot live up to, but I undertake that he will be given a chance tomorrow night.


George Stanley White: As
I understand the rules, on going into supply on Thursdays and Fridays there is no motion.


Paul Joseph James Martin: Yes, that is right.


George Stanley White: But I am perfectly satisfied with what has been said.



UNEMPLOYMENT SITUATION IN MARITIME PROVINCES

Mr. CLARENCE GILLIS (Cape Breton South):: Mr. Speaker, I-am glad that matter
is settled. Now the minister has another one on his hands. Before you leave the Chair, Mr. Speaker, I intend to discuss a matter which I consider is of urgent importance to the people I represent in the house. It means bread and butter to them.
I listened to the minister's request of the hon. member for Hastings-Peterborough (Mr. White), and there is no minister I would rather oblige than the one who has just spoken.


Paul Joseph James Martin: Thanks for those kind
words.


Clarence Gillis: Nevertheless I do not consider the request he made of the hon. member for Hastings-Peterborough was a valid one. The fact that many of the cabinet ministers are out of the house is immaterial. All of them can read. Tomorrow they can read what took place in the house tonight and, in their absence, they can do something about the subject matter discussed. I am not criticizing them for being where they are this evening; it is their duty.
If there were any possibility within the next couple of weeks of discussing the matter I am now going to discuss-and I shall be as brief as I can-I would not be raising the matter at this time. However, there is not.


Paul Joseph James Martin: Mr. Speaker, in view of
the attitude I have taken, and in fairness to the hon. member for Hastings-Peterborough, if the hon. member who is now speaking persists in going on I do not see how the house can refuse to hear what the hon. member for Hastings-Peterborough has to say. In fairness, it must be said that he took the initiative in the matter.


Clarence Gillis: Well, Mr. Speaker, that
matter has already been settled. The minister and the hon. member for Hastings-Peterborough have already come to an understanding. The hon. member agreed to let his problem stand until such time as the appropriate minister is in his seat, and supply is to be called to suit his convenience. Then the hon. member took his seat.
I do not consider I am violating any of the rules of the house in raising the problem I am now about to discuss.


Paul Joseph James Martin: I do not wish to be unduly persistent, either; but in view of the request I make of the hon. member for Hastings-Peterborough, I am sure the hon. member for Cape Breton South will agree that I should make the same request of him. He will have the same chance tomorrow night to make the observations he now has in mind. They would be made with the ministerial benches filled, and with the responsible minister in his seat. In view of the circumstances, and of the engagement of my colleagues, I think my request is not an unreasonable one. And, knowing the hon. member as I do. I have no hesitation in asking him to accede to it.
Unemployment in Maritimes


Clarence Gillis: Mr. Speaker, as I stated when I first rose in my place, there is no minister in the house I would rather oblige. However, under the circumstances the matter I am about to discuss is a serious one.


John Ritchie MacNicol: On a point of order; if the hon. member is going to make a speech on any subject on going into supply, then surely the hon. member for Hastings-Peter-borough, who has taken his seat, should have the right to go ahead, as the minister has suggested.


William Ross Macdonald: The minister has made a request of the hon. member for Cape Breton South. The hon. member has not yet stated whether he is prepared to allow the matter he has in mind to stand over until a future time. He should now be given an opportunity to state his position.


Clarence Gillis: Mr. Speaker, we are wasting a good deal of time. It is my intention to proceed with the subject matter I am about to discuss.


William Ross Macdonald: On the point of order raised by the hon. member for Davenport; I understand that the hon. member for Hastings-Peterborough entered into an agreement on the understanding that we would immediately go into supply. If we are not going into supply immediately, then he should be given an opportunity to make his representations now.


Angus MacInnis: On the point of order; the arrangement made between the hon. member for Hastings-Peterborough and the minister was a personal one and, if the hon. member for Hastings-Peterborough has given way, it is not binding upon the rest of the members. He gave way on the understanding that the motion to go into supply would be made tomorrow.
I am not suggesting that the hon. member for Cape Breton South should or should not give way. But it has no bearing on the other matter which has already been settled.


Paul Joseph James Martin: Well,, Mr. Speaker, what the hon. member has just said is true, technically. But I take it that, as leader of the house for the moment, I was expressing what seemed to be the consensus of the house generally w;hen I made the arrangement with the hon. member for Hastings-Peterborough. The hon. gentleman is knowm by everyone in all quarters of the house as being extremely fair-minded, and I say that in all sincerity. I know he will recognize and appreciate the position of the hon. member for Hastings-

Peterborough. I say to him that, in view of the fact that the ministers are, in line of duty, inevitably outside the house, my request is not an unreasonable one, particularly when an opportunity will be given tomorrow to deal with the important matter the hon. gentleman says he has in his mind. I again ask him as one who will understand the reasonableness of my request.


Clarence Gillis: The hon. member for
Hastings-Peterborough wishes to discuss a matter which pertains to only one department and it is reasonable to ask that the minister of that department should be here. The matter which I am going to discuss has to do with government policy as applied to the section of the country which I represent in this house. Whether there are one, two or half a dozen ministers here is immaterial. This matter has been outstanding for some considerable time and apparently no effort has been made to adjust it. It is a grievance which will not take me very long to state; I think it is important enough to be stated at this time and I intend to proceed.


John Ritchie MacNicol: On a point of order.


Clarence Gillis: Have I the floor?


William Ross Macdonald: The hon.
member for Davenport has risen on a point of order, but I think the hon. member for Cape Breton South should be allowed first to state his position. I do not want the hon. member for Cape Breton South to discuss his grievance; I want him just to state his position.


Clarence Gillis: You mean as to whether or not I intend to proceed?


William Ross Macdonald: Yes.


Clarence Gillis: It is my intention to observe the rules of the house and proceed with my discussion.


William Ross Macdonald: The hon.
member for Davenport was raising a point of order.


John Ritchie MacNicol: My own opinion is that, under the circumstances, the request made by the minister was fair and the acceptance of that request by the hon. member for Hastings-Peterborough showed a chivalrous spirit on his part. If the debate is to go on, to save the minister being charged tomorrow with not having the debate go on I think the hon. member for Hastings-Peterborough should precede the hon. member for Cape Breton South. The hon. member for Hastings-Peterborough gave up the floor on the suggestion of the minister and we all felt that

Unemployment in Maritimes
the minister's request should be acceded to. I am going to insist that the hon. member for Hastings-Peterborough go ahead.


George Stanley White: On a point of order-


Clarence Gillis: Have I the floor or not?


William Ross Macdonald: The hon. member for Hastings-Peterborough is speaking on a point of order.	.


George Stanley White: I feel that the arrangement agreed to between the minister and myself was a reasonable one and I was happy to agree to it. Under the circumstances, I would not care to proceed tonight.


Paul Joseph James Martin: I thank my hon. friend.


Clarence Gillis: Mr. Speaker, I am sorry that I am not able to oblige the minister, but I also have responsibilities in this house.


Some hon. MEMBERS:: Oh, oh.


Clarence Gillis: I have responsibilities even if some members across the way have not.


An hon. MEMBER:: Make it snappy.


Clarence Gillis: I am referring to those hon. members who interrupt when someone is trying to talk.


An hon. MEMBER:: Go ahead; talk.


Clarence Gillis: At least they should have sufficient courtesy to keep quiet.
As I stated at the outset, the matter I wish to discuss tonight affects the people of the maritime provinces generally and Nova Scotia in particular. There are over 30,000 unemployed in the maritime provinces and perhaps some 17,000 of those are in Nova Scotia. A large percentage of the unemployed in the maritime provinces are service personnel of this war. From present indications it would appear that there is no government policy or policy on the part of free enterprise to create anything in the way of employment in any one of those provinces.
In addition, the old relief measures which prevailed prior to the war are not in existence, and those service personnel who do not come under the out-of-work benefits or those who have run beyond the statutory provisions of the Unemployment Insurance Act have no relief whatsoever. On two occasions in this house I suggested to the Minister of Veterans Affairs (Mr. Mackenzie) that the out-of-work benefits for service personnel should be extended until such time as they can be gainfully employed. That was some time ago, but no extension has been made and there is no 83166-256
indication from the government that an extension will be made. Second, I suggested on two or three occasions that the Unemployment Insurance Act should be expanded to provide unemployment relief, if you must call it that, for able-bodied workers who cannot secure employment in any part of Canada. There has been no indication on the part of the government as to whether that will be done.
Direct relief for the people I am discussing is thrown back into the hands of the municipalities and most municipalities across this country are not financially able to handle direct relief. There is no arrangement, either federal or provincial, to establish relief measures of any kind for the unemployed. In that respect they are worse off today than they were in the 1930's, up to the outbreak of this war, because at that time there was some system of relief. As I say, thousands of these people have run beyond the Unemployment Insurance Act and the out-of-work benefits.
The worst feature of the whole situation in the maritimes is that, while these unemployed are milling around, no plans are being made by the federal or provincial governments to give them relief, and there are no plans on the part of free enterprise, or at least none in sight, to establish secondary industries. On the other hand, people who are endeavouring to dto something in that part of the country are stopped by federal regulation. I should like to give three or four examples of this.
I raised a question in the house on at least two occasions and I have written to the engineering branch of the Department of Public Works with reference to repairing an old pier at Sydney, Nova Scotia. This would cost only a few thousand dollars. There are a few people in Sydney who are prepared to establish a fish processing plant and a bait freezing plant which would service the fishermen for about thirty miles along the coast line, men who now have no harbour facilities. An expenditure of a few thousand dollars by the federal government would create new wealth through the establishment of these plants which would be set up to service the fishermen on that coast. This matter has been held in abeyance for eighteen months, and the men who were going to establish these plants have become disgusted to the point where they are not sure whether they will proceed with them.
A couple of boys got together in Sydney, Nova Scotia, about a year ago and pooled their resources, purchased a building and put some equipment in it. They made a contract with a canning factor}' in Ontario to supply cans.

Unemployment in Maritimes

They intended to go into the canning of pork and beans which would have meant employment for some twenty or thirty people. They have been waiting for over a year for a molasses quota. The building and equipment are standing idle; no molasses quota has yet been furnished.
A few days ago I questioned' the Minister of Finance (Mr. Abbott) in. the house about an established industry in New Glasgow, Nova Scotia, Topper Industries Limited. They were canning chicken. Their market was largely an export one. They were refused' an export permit and had to swing over into the processing of pork and beans; but they -were refused a permit to go into that business by an order in council which was passed in 1941. If you were not in that business in 1941 you cannot start a new business in that line. They are standing idle. They employed some sixty people and they are now waiting some word as to whether they may proceed.


Mr. HACKETT:: That is a shame.


Clarence Gillis: The Minister of Finance made it quite clear to the house a few days ago that no permit will be granted. These sixty people are unemployed..
On the other hand, there is a plant in Truro, Nova Scotia, which could manufacture icecream cones. The young man went over to the United States and studied the process of making that particular commodity. He bought equipment and invested S35.000 in it. He has been waiting for a year for his sugar quota. He cannot operate because he cannot get a sugar quota, and there is not another plant like it in the maritime provinces.
Hon. members talk about free enterprise in a free economy. Is it free? Is there any competition there? That is not control; that is dictatorship on behalf of central Ontario and Quebec manufacturers.
An hon MEMBER: That is what you want, more control.


Clarence Gillis: That is dictatorship; that is the bureaucracy we are trying to smash.


Mr. ROSS (Souris):: That is what you have been after all the time, more controls.


Clarence Gillis: I have the answer as to why we are not allowed to process pork and beans in the maritime provinces. It is contained in a letter from a commission merchant of Sydney, Nova Scotia. He gives the reasons, but I shall not read them all. He cannot understand why the canning of pork and beans in New Glasgow cannot be proceeded with. There is no shortage of cans. The plant has.

400,000	cans on hand. There is plenty of molasses and plenty of beans, but it cannot get the permit because of an order in council which was passed in 1941. When the minister telegraphed the Canadian Legion which protested against this thing he said that it wrould not be fair to those already established1 in the business. That is pretty plain language.
As I say, this letter, is from Sydney, Nova Scotia, and is dated June 6. The commission merchant says that he cannot understand why they could not go into the business in New Glasgow, but he says that the reason may be this:
This week, Stoker-Van Camp Inc., a U-S.A. controlled company, operating in Ontario have to date this year brought into Sydney for distribution through local wholesalers 8,090 cases of Van Camp's pork and beans, not taking into consideration the thousands of eases of canned pork and beans brought into Sydney by Clarks, Heinz's, Canada Packers and Dominion and Canadian Canners Ltd., besides thousands of cases from independent small Quebec and Ontario packers, but, with the exception of small L.C.L. shipments from Lanes Ltd., Moncton, New Brunswick, none from the maritimes. The W.P.T.B. refused to allow my customer, Brennan & Company, North Sydney, Nova Scotia, to bring in a car of white beans I secured for Brennan from Gorman, Chatham, Ontario. Car was stopped at Montreal. The following week, Canada Packers, Sydney, distributed a car of white beans-
-in the same city, but they confiscated his car and put it to one side in Montreal. Every control that was exercised by this government during the war and that would protect the people of this country has been thrown out. Price controls have all gone out the window, but there have been maintained, behind the scenes, controls that protect the capitalists of this country. I am not concerned about the wealth that Canada Packers, Swift Canadian Company, or any of the rest of them have. The thing that I have always protested against is the power that they exercise behind the scenes to stop the people of this country from creating new wealth themselves. I have given four examples of it tonight which have cropped up during the last couple of months where restrictive legislation in sugar and molasses quotas, export permits and a permit to operate these little plants demonstrates the control from behind the scenes in the interests of the big packers and processors in the two central provinces ,to the detriment of the provinces of Nova Scotia and New Brunswick. That is why I am speaking tonight. This is important and urgent. Surely if we cannot force either the federal or the provincial governments to accept responsibility for 30,000 citizens of this country who have not the means of livelihood because of restrictions behind the scenes which prevent people who

Unemployment in Maritimes
are progressive from establishing some kind of employment in these provinces we should know about it. These people should be allowed to go ahead without restrictions from Ottawa preventing them from carrying on.
The Minister of Finance can read this tomorrow. So far as I am concerned, I intend to pursue it. I hold in my hand a clipping from Halifax. The hon. member for Halifax (Mr. Isnor) should read it. Some hon. members from Nova Scotia and New Brunswick would lead one to believe that everything is prosperous in that end of the country. When a few of us rise in our places and tell the truth about conditions as they actually exist they say that we are crying havoc and that conditions are not that bad. They are worse than they are being portrayed here. This clipping I hold in my hand is a Canadian Press dispatch. I do not think they would lie about the matter.


An hon. MEMBER:: How did you vote on the control bill?


Clarence Gillis: I voted for it. But there are no controls. The government pays lip service to controls. Hon. members to my right do not want them except where they protect Canada Packers and the other big corporations.


An hon. MEMBER:: No.


Clarence Gillis: There is no such animal as control except the kind of controls that I have described tonight.


Edmund Davie Fulton: Who voted to retain them?


Clarence Gillis: The Dominion Steel and Coal Company and other such companies are the people who are controlling today. You are just the little man at the end of the string who dances when they pull the other end on St. James or Bay street.


An hon. MEMBER:: There is a by-selection in Halifax.


Clarence Gillis: That is too bad. This problem has existed ever since the people of the maritimes were foolish enough to relinquish control of their own end of the country and to enter into a confederation which has strangled them ever since. We have had this problem for fifty years. It is not new. All that we are asking is that there be restored to us some of the things that were taken from us, lifted out and the wealth siphoned off.
This clipping from Halifax paints a pretty bad picture in that city. It was not written by the C.C.F. or the trade unions.


An hon. MEMBER:: You want a preferred control.
83166-256J


Clarence Gillis: The Canadian Press dispatch is dated June 5. I shall not read the top part of it because it is too bad. But it says:
"Things are bad in Halifax and they are going to be worse," said J. J. Kelly, civic welfare inspector. "I hate to think of what is going to happen to many people next winter."
Doctor A. R. Morton, public health and welfare commissioner, agreed -that "it's going to be bad next fall."
Most pessimistic note was sounded by Miss Helen Burgess, family welfare bureau secretary.
The conditions today," she said, "are like the early days of the depression. Even those drawing unemployment insurances and family allowances are not getting enough."
Officials of the unemployment insurance commission told reporters that of the 2,590 unemployed males here, "about 30 per cent" were not drawing out-of-work benefits although some were entitled to do so. Insurance is paid for a maximum of one year and applicants must meet certain requirements to qualify for it.
The city has no programme of direct relief similar to that followed in the 30's, and Mayor ;; *	[DOT] Ahern said no such scheme was planned.
j , ,pe that win never have to come again," he added. "Work is what the people want-not relief.
I agree with that. But when no work is available and apparently no one is making any effort to create employment, relief of some kind is necessary. People cannot stay on the roadside and starve. The article goes on:
Miss Burgess said the family welfare bureau which handles most of the needy family cases irom a fund contributed by the community chest ana the city of Halifax, has been able to look alter only the most destitute cases.
My main object- in rising tonight was to focus attention on the fact that people in Nova Scotia who are willing to go ahead and do something for themselves are being prevented by Ottawa, and the examples I have cited I have brought to the attention of the house and the government so that at least the restrictions may be removed which prevent people from creating work.
Before I conclude, I am going to make a few recommendations. First, I recommend that the industrial development bank should at least open an office in Nova Scotia. The industrial development bank was created, as I understood the discussion in the house at the time, for the purpose of going into the field in the post-war period and helping to create secondary industries throughout Canada. It has not performed that function, and the interpretation that I received today of the functions of the industrial development bank is that it- will not assist in the establishment of new industry; that it will assist in the expansion of industry established at present. But the industries that are established today do not need assistance. Most of them
Unemployment in Maritimes

are large, and if they wish to expand they can very well use their excess profits tax which was refunded to them. That is why it was refunded. At least that was the reason given for refunding it.


An hon. MEMBER:: When was it refunded?


Clarence Gillis: They have got it all back by this time.
The purpose of the industrial development bank was stated at its inception to be to give assistance to a person or group of people who had some capital and could meet the regulations for the purpose of developing secondary industries in the province where it was not profitable for Canada Packers and other large firms to go.
Second, I recommend that the government should give consideration to extending the out-of-work benefits to service personnel until such time as they are able to secure employment. We owe them at least that much.
Third, I recommend that the government give consideration to extending unemployment insurance to care for people who are unemployed and seeking employment and are able to work until such time as employment can be found for them.
I am going to suggest to the Minister of Finance that he reconsider the decision made by his department and relayed by himself to the Canadian Legion of New Glasgow and that a permit be granted to Topper Industries Limited to can beans for sale, so that they may be able to put back to work sixty people who are now out of work because Topper Industries Limited cannot get a permit.
I am also going to recommend that Maclean Brothers, who have made an investment in a small plant at Sydney, Nova Scotia, be granted a molasses quota, so that they can put that plant in operation. I also recommend that the ice-cream plant at Truro-I am not going to give names-should be given a sugar quota, so that they may put their $35,000 investment in that little plant to work.
If these things were done it would be an indication to these communities that the federal government was at least interested in them to the point of permitting them to do something for themselves.
Fourth, I suggest to the Minister of Public Works (Mr. Fournier) that he put an appropriation in the supplementary estimates this session to repair that old pier at New Victoria on Cape Breton island, so that the fish processing and bait freezing plant can get into operation and service the fishermen on that thirty-five mile coast.

It was not easy for me tonight, Mr. Speaker, to hinder my very good friend the Minister of National Health and Welfare (Mr. Martin) from going on with his estimates, but these matters I have raised are urgent. They mean bread and butter to the people I represent in this house. I hope that the ministers who are away on other duties tonight will read my remarks, pay attention to them and endeavour to alleviate the sore spots that I have enumerated tonight.


Mr. A. J. BROOKS (Royal):: Mr. Speaker, the problem which the hon. member for Cape Breton South (Mr. Gillis) has brought before the house tonight is not a new one. It has been discussed in this house many times during the present session. As he stated, it is as old as confederation, at least eighty years old anyway. The solutions which my hon. friend has suggested are only temporary. He recommended that a few small factories in Nova Scotia be granted certain quotas of molasses and sugar and so forth, and as I sat here I could not avoid realizing that only about seven or eight hundred people out of about 35,000 seeking work could find employment through the solutions he suggested. It is a big problem and one with which this House of Commons must deal at some time.
We in the maritime provinces feel that we have not received proper treatment for a great many years. The unemployment we are suffering today is the accumulated1 result of federal policies of the past, and more particularly the policies which this government followed during the last war. We in the maritime provinces situated near the coast were in a favoured position during the war for the supplying of munitions for overseas, and we thought factories would be established in those provinces to produce the munitions for our armies overseas. But that did not happen. My own province of New Brunswick received less than one-half of one per cent of the munitions production in all Canada, although we have a population of nearly 500,000 as compared with 12,000,000 for the whole dominion. So what we are experiencing today is mainly the result of the neglect we have received in the past.
There is not much unemployment in the province of Quebec and very little in Ontario, for the simple reason that the large factories established there with the assistance of the government for the production of munitions during the war are today producing civilian goods. Had the same policy been adopted in our maritime provinces, we would not be in the position we are in today. The hon. member for Cape Breton South (Mr. Gillis) recom-

Unemployment in Maritimes
mends that our people receive out-of-work benefits. He went on to say-and I think rightly so-that the people of the maritimes do not want charity. It is not out-of-work benefits that we desire. It is work that we want and it is work that we should receive. The hon. member appealed to the Minister of Public Works (Mr. Fournier). I realize, as I am sure does every other hon. member, that it is not possible to build industries in a few days or a few months. Our unemployment is a thing of the present; and you cannot go along and, by a wave of the hand, establish a factory here and another one there. We must have something else. I hope this government will realize that factories and secondary industries must be developed. We have the common sense to know that these industries and factories cannot be established overnight. In the present unemployment situation in the maritime provinces, what I suggest to the government is that there be voted by this parliament money with which to start public works. An eloquent appeal was made to this house not so long ago for the commencement of the Chignecto canal between New Brunswick and Nova Scotia. This would give work to many thousands of people, and is something which would be of everlasting benefit to those small provinces down by the sea.
In my own province of New Brunswick wo have no national park, and we are the only province in the Dominion of Canada without one. We are told that the tourist industry is one of the greatest industries that can be developed in Canada. I would ask this house or anyone who has visited the maritime provinces if there is any finer part of this Canada of ours, for the purpose of development of the tourist trade. I do not think there is any finer place than along the Saint John river. But we have no national park there. I am not blaming the federal government for this deficiency as much as I blame our own provincial government, because when national parks were established in Nova Scotia and Prince Edward Island, New Brunswick could have had a national park if the provincial government at that time had not been so small that they fought over the site of the national park and did not select the one which the federal government had recommended.
This is a situation which the hon. member for Cape Breton South thought was so urgent that it could not wait for even a day. Well-, we have waited now for eighty years, and perhaps one day more would not have made a great deal of difference. I hope the government will consider the seriousness of the present situation. We have had a strike in Nova Scotia and New Brunswick.


Clarence Gillis: And still have it.


Alfred Johnson Brooks: And we still have it.
Perhaps the fault is not all on one side; I do not know. I have heard it said that there are 13,000 men or more out on strike, and that they account for possibly 13,000 or 15,000 of the 30,000 unemployed in those provinces. The men want to work, but for some reason- I am not here to judge what it was-it was a case of "on again, off again, Finnigan"; work one day and not work the next. There may have been some fault there, but it is a sad commentary on the industry of this country and on the labour regulations of the government when men can go to work one day and then, because of a dispute over some matter which certainly could have been settled, not go to work the next. If there is any common sense at all in industry and labour, surely this small matter could have been settled and these men could have gone back to work or could have remained at work.


Clarence Gillis: There were fifty-eight points at issue.


Alfred Johnson Brooks: Yes, and I suppose you could make fifty-eight more. I am not blaming labour. I am not blaming industry. Probably there was fault on both sides and both should be blamed. However, it is the children and the wives who are suffering. As I say, 15,000 of this 30,000 are possibly responsible for half of the unemployment in our provinces. In my own constituency there are 700 to 800 men out of employment in the mines. Not one of those men wanted to go on strike.


Clarence Gillis: They are back to work.


Alfred Johnson Brooks: Yes, they are back to wortt today. But if these men had been left to themselves, if they had been allowed to form their own union and not the tail-end of the union at Glace Bay in Nova Scotia-


Clarence Gillis: Mr. Chairman, I know the hon. member did not want to be unfair-*


Alfred Johnson Brooks: Not at all.


Clarence Gillis: *-but he has certainly demonstrated that he is uninformed. The miners were an independent union for years. When they came in with the mine workers of Nova Scotia they voted on the matter. It was a democratic vote, and they voted themselves into that union.


Alfred Johnson Brooks: Well, I will admit that my hon. friend is better informed than I am on
Unemployment in Maritimes

labour matters. He has been a member of a labour union. I am only taking the word of the men whom I have consulted in my own constituency and the word of the operators. The operators and the miners in Minto have always got along well together. I have been told-and I believe it-that if the union at Minto had not been connected with the union in Nova Scotia, there would not have been any strike in New Brunswick. However, that is a matter-


Clarence Gillis: May I ask the hon. member a question?


Alfred Johnson Brooks: Certainly.


Clarence Gillis: Did your constituents inform you that the miners' wage rate increased by fifty per cent as compared with what it was when they came in with the mine workers of Nova Scotia?


Alfred Johnson Brooks: No.


Clarence Gillis: Well, it did increase by fifty per cent.


Alfred Johnson Brooks: I am speaking about the present.


Clarence Gillis: I am speaking about the men's wages going up by fifty per cent.


Alfred Johnson Brooks: I think the wages of nearly all the people employed in Canada have gone up by fifty per cent, whether they are carpenters, bricklayers or whatever they may be. I believe the wages of the miners in Minto would have gone up by fifty per cent whether they had been connected with the union in Nova Scotia or not. Be that as it may, I think the hon. member for Cape Breton South and I agree on ninety per cent of the matters to which he has referred tonight. I will not agree with him that the mines and everything else should be nationalized, and that private enterprise should be done away with. Private enterprise has built up this country, and I have great faith in private enterprise. If the government takes a friendly view of our situation in the maritimes, these matters can be corrected in the future.
Mr. GORDON B. ISNOR (Halifax): I had no thought of entering into the debate this evening, Mr. Speaker. It is only as a result of perhaps two remarks made by the hon. member for Cape Breton South (Mr. Gillis), that I am on my feet now. One remark was, "Any member who wants to tell the truth"; and the hon. member for Cape Breton South would almost lead the members of this house, as well as the people of the country at large -particularly those residing in the maritime 
provinces-to believe that he w'as the only member from the maritimes who was anxious and concerned about the conditions in that section of the country. I think each and every member, irrespective of the party he represents, is interested in the welfare of the maritimes.


Mr. BENTLEY:: Nobody else ever told the truth.


Mr. ISNOR:: I have heard members sitting on this side of the house and in the official opposition on more- than one occasion present a fine case on behalf of the maritimes. There are others, in addition to myself, on the government side who have presented a very strong case. From time to time in my own way I have endeavoured to bring forward constructive thoughts that would be helpful to Nova Scotia in particular and the maritimes as a whole. A section of the press in the extreme far end of Nova Scotia often refers to the hon. member for Cape Breton South as the only member who rises in his place and fights for Nova Scotia. I believe that is a mistaken idea, as hon. members of this house will realize. There are other members, just as sincere, sitting in every section of the house; and 1 say that with all due respect to the efforts of the hon. member for Cape Breton South.
What did he place before us this evening? He referred to the industrial development bank and set out, in part, the functions of that bank. As I remember, thinking back three or four years, the function of the industrial development bank was to assist any new concern to become established, or to promote expansion along certain lines; and I have yet to learn of a single case in which that bank denied an application of that kind. I wonder if the hon. member for Cape Breton South could name two definite cases coming within the provisions of that act where the industrial development bank has denied the applications.


Clarence Gillis: Do you want me to answer that question now? Up in my office I have a list of seventeen which I got from Graham Towers.


Gordon Benjamin Isnor: The hon. member has always a long list in his office or elsewhere.


Clarence Gillis: It is official, from the head of that bank; seventeen applications from Nova Scotia were refused.


Gordon Benjamin Isnor: I repeat that, to my knowledge, not a single application which came within the provisions of the act has been refused.

Unemployment in Maritimes


Clarence Gillis: That is it; what are the provisions of the act?


Gordon Benjamin Isnor: The hon. member referred to the businessmen, who, he said, were not using the refundable portion of their excess profits tax to expand. As an hon. member of the opposition mentioned, they have not as yet received that refundable portion. Large numbers of men in the so-called free enterprise or incentive class are anxious to expand and are just waiting for the refunds to be made. They are -ready to make use of the money as soon as it is available.


Clarence Gillis: Poor fellows; why don't they get out-of-work benefits if they are so poor?


Gordon Benjamin Isnor: Work benefits have nothing whatever to do with the matter. That is the difference between the hon. member and myself. I sit here and listen to him try to expound what he has in mind' and do not make any foolish interruptions. When I am dealing with a matter like the refundable portion of the excess profits tax the hon. member interrupts and brings in an altogether different question. If the hon. member wishes to direct an intelligent question-


Clarence Gillis: You wouldn't understand it.


Gordon Benjamin Isnor: -I am quite prepared to take my seat and have him ask that question, if he - has something to bring up of a constructive nature or something that will bring out some real information. Otherwise I would ask him to do as I try to do; that is, act the part of a gentleman. I do not say that in an unkindly way, but it is a little lesson I have more or less learned from the hon. member for Calgary West (Mr. Smith), who so often uses an expression like that to bring the rest of us back to a proper sense of proportion.
I should like to follow along the line of the statements made by the hon. member for Royal (Mr. Brooks), who said this was not a new problem. It is an old problem with us, and I admit it. We are in an awkward position in the maritimes. I am anxious to cooperate with anyone, in any part of the house, who will bring forward a solution that will help us there. We have talked over these matters time and again; but unfortunately in our section of the country it would appear almost impossible to bring about industrial development with the principal market one or two thousand miles away. Our own market is limited. Roughly speaking, we have some
600,000	people in Nova Scotia, another 500,000 in New Brunswick and perhaps 100,000 in Prince Edward Island, and that does not represent a market large enough to permit
any real development. In Ontario and Quebec, on the other hand, they have a population of three and a half to four million people almost at their back doors. Naturally that brings down the cost of production to a point that we find it hard to meet in competition.
It is true that we have had some outstanding examples of industrial development in the maritimes. The hon. member for Cape Breton South referred to Halifax, and perhaps that is another reason why I am standing here saying a few words on this occasion. There we have Moirs, known from coast to coast as producers of perhaps the best chocolates made in Canada. They have made a real success of their industry. On previous occasions I have referred to Stanfield's, in the town of Truro, which has also made an outstanding success. I do not wish to repeat what I have said already about that fine firm and the manner in which they have carried on over a long period of years. Also in Halifax we have the Schwartz firm, whose products are known all over Canada. At the present time, however, they are finding it difficult, because they have to buy all their glass containers in central Canada; and the transportation charges on the containers, plus transportation charges back to market, total more than the cost of the products themselves. That is a heavy handicap under which they have to work. Then we have the Lewis firm, also in Truro, which has made a great success, whose hats and caps and ladies' hosiery are sold in every part of Canada. There is Borden's milk, and I could go on with a number of others, but they are all finding the competition very keen. I wonder if perhaps transportation charges and the lack of certain containers, such as I mentioned in connection with the Schwartz firm, do not keep these firms from progressing to a greater extent than they have been able to do up to the present time. In regard to containers, a short time ago I thought we had an opportunity to bring a glass factory into operation in Nova Scotia. I did my best to assist in bringing that about, but unfortunately it has not as yet come to pass. We are still hopeful that we may see such a factory commence operations in Nova Scotia, making bottles, jars and so on to meet our requirements in that respect. We still have some shoe factories in the maritimes; very good shoes are made in Fredericton.


Alfred Johnson Brooks: The Hartt is the best shoe made in Canada.
Unemployment in Maritimes


Gordon Benjamin Isnor: Again I agree with my hon. friend, that they make among the best shoes sold in Canada.


Mr. BROWN:: The manager of the Hartt Shoe Company is from Windsor, Ontario.


Mr. CASE:: Windsor; where is that? It begins with "wind" and ends with "sor".


Gordon Benjamin Isnor: I have no objection to the maritime provinces making use of some good products from Ontario, even if it includes the manager of a factory.
Then, we have clothing firms in Nova Scotia which formerly sold "A.P.H." trousers right through to Vancouver, and are still doing a good business. So I say things are not too bad. While they are not as good as we would like them to be, certainly they are not in such a blue and depressed condition as the hon. member for Cape Breton South would have us believe. I have been in business for many long years, and I have never found it helpful to talk about the rainy days and poor business. Rather I look upon the good days. And when I come in after a good day I say to my clerks, "I congratulate you; that was a worth-while day you had yesterday. Just see if you can do better tomorrow." We have kept on building and building, not with overoptimism but always with an optimistic view of things. I feel, if the hon. member for Cape Breton South would join some of the other members from Nova Scotia and the other maritime provinces, and do a little more boosting and less knocking, it would be better.


Clarence Gillis: Before the hon. member sits down-and I think he is going to sit down soon-


Gordon Benjamin Isnor: No.


Clarence Gillis: -would he answer a question?


An hon. MEMBER:: If it is a sensible one.


Gordon Benjamin Isnor: Go ahead and ask it.


Clarence Gillis: I raised four points tonight, and asked for four small plants and factories which are waiting to operate down there.


Gordon Benjamin Isnor: I thought the hon. member was going to ask a question. He is starting to enumerate some points.


Clarence Gillis: Is the hon. member in favour of granting the quotas and the necessary permits to get those four small plants operating?


An hon. MEMBER:: No.


Gordon Benjamin Isnor: Who said, "No"?


Clarence Gillis: Are you trying to say there is no need for them?


Gordon Benjamin Isnor: I will answer that myself, and it will not be no. You cannot put me in that position. I am just as anxious as the hon. member for Cape Breton South to do what he has suggested, except that I want to see it done in a proper way.


Clarence Gillis: We have been waiting for a year and a half.


Gordon Benjamin Isnor: The other day the hon. member made quite a case about pork and beans, and he used the chicken tin or can as an illustration. I think it is recognized by the trade throughout the whole of Canada that it is not economically sound, that it is not good business, and that one cannot possibly build for the future on the basis of a seven-ounce tin or can.


Clarence Gillis: That is free enterprise.


Gordon Benjamin Isnor: I believe that is recognized, and it is because of that they use the twenty-ounce can. Inexperienced as he is, the hon. member for Cape Breton South must at least take that for granted, because that is a reason given by the trade, and a well-established practice. We were in somewhat the same position in Halifax, although in some respects it was more favourable, so far as beans are concerned. Some years ago one of our large concerns had to go out of business because they were unable to procure tins. But of course they would not have used those small seven-ounce tins; even if they could have procured them. It would not have been sound business to do so.
The hon. member asked whether I am in favour of Maclean Brothers case for an extra sugar quota. One must consider the necessity of taking sugar away from consumers who want their full quota. The decision had to be made as to whether Maclean Brothers should have a larger quota of sugar, or more than someone else who was serving the public, thereby taking the quota away from the individual consumer and giving it to Maclean Brothers. Surely it is a matter of judgment. If they could have been given more sugar, without its being taken away from others, then I would have been with the hon. member in advocating that Maclean Brothers be given the quota to allow them to proceed.
The second case to which the hon. member referred was somewhat similar, having to do with a sugar quota.


Clarence Gillis: It was molasses in one instance and sugar in another.


Gordon Benjamin Isnor: They are both on quota. The hon. member is in favour of controls, and I am in favour of a certain degree of controls, as has been stated this evening. I was in favour

Unemployment in Maritimes
of controls during the period of the war, but I feel that, for the general good of trade as well as that of the consuming public, a gradual removal of controls is a good thing for this country.
With respect to public projects, I do not know just how those projects are going to serve the people in the future. They are, of course, temporary measures. Anything that will help the fishermen of Nova Scotia, such as the building of wharves and breakwaters, and anything which will permit them to carry on their industry to a greater extent, would have my full support. That was about the only constructive suggestion the hon. member advanced this evening.
In closing, let me say in all sincerity that sometimes we in the maritimes feel we are forgotten by the rest of Canada. I do not know whether the solution is additional freight rates subsidies-and I do not like the word "subsidies"-or a regional tariff which would permit us to export or to ship to central Canada, and put us on a more equal footing with manufacturers in central Canada. Perhaps we should be given special benefits in the matter of exports.
When I refer to exports I am reminded that the hon. member for Royal (Mr. Brooks), the hon. member for Queens-Lunenburg (Mr. Winters), with myself and other hon. members on this side of the house advocated a greater quota of lumber for the maritime provinces. I am happy to say that that quota has been increased to a marked extent because, I believe, of the efforts of hon. members from the maritime provinces. The minister in charge recognized the need, and the fact that the suggestions we advanced were those which would be helpful to our section of the country, with the result that we have been allocated an additional 50,000,000 feet for export purposes. After all, our export business is very important to us. Sixty per cent of lumber in the maritimes is exported, and it is that market we want to hold, encourage and enlarge when we fight for a greater quota
The hon. member for Royal mentioned the Saint John river. I agree that it is a beautiful river. However I cannot take my seat without referring to the fact that in Nova Scotia we have one of the finest national parks in the whole of Canada, and the well known Cabot trail is known everywhere.
Then in the county of Halifax we have Peggy's Cove, one of the most painted spots on the continent. It attracts a large number of United States artists w'ho come every year. At the present time the Nova Scotia government is embarking upon an extensive road building programme and is developing the tourist business.


An hon. MEMBER:: Do not forget the
Annapolis valley.


Gordon Benjamin Isnor: Then the hon. member for
Cape Breton South questioned the hon member for Royal in regard to wago increases. When the wage control was taken off on November 8, 1946, there was practically an immediate general increase of wages in the retail stores, without any efforts on the part of the retail clerks or any one else. That was free enterprise. I agree with the hon. member for Royal that free enterprise has done a good job in this country, has built in the past and is building for the future.


Mr. R. H. WINTERS (Queens-Lunenburg):: Mr. Speaker, I should like to say a few words in view of the fact that this particular subject has been raised. Of course there is much in what the hon. member for Cape Breton South (Mr. Gillis) has said, although as usual be spoke in an unduly pessimistic manner. He knows as well as anyone. else that he is at a particular disadvantage because he is the only member of his party east of Winnipeg. He seems to think that if the Liberal members from Nova Scotia banded together they could do more, but he is well aware that he does not know the extent to which we can and. do work together on this side of the house and obtain benefits of which he knows nothing.


Stanley Howard Knowles: Nobody ever hears of them.


James Arthur Ross: Why not tell the people about them?


Robert Henry Winters: It is always more effective for opposition members to talk about things one cannot get than about the things which are obtained day in and day out.
The hon. member for Cape Breton South always uses the round figure of 30,000 when talking about the unemployed in the maritime provinces, but the actual figures show that at the end of April there were 13,779 people, made up of 11,585 males and 2,194 females, receiving unemployment insurance benefits That is considerably short of 30,000.


Clarence Gillis: The. rest are not obtaining unemployment insurance; they have run out.


Robert Henry Winters: There is a growing feeling in the maritimes that something constructive can be done. The hon. member for Halifax (Mr. Isnor) reflected the spirit of optimism which many of us feel. We showed, in. full
Unemployment in Maritimes

measure during the war what we can do when given the opportunity. Many industries grew where there were facilities to support them. The population was swollen because of these wartime industries, and in the light of all the factors I think the employment situation, though serious, is remarkably good. Certainly it does not compare with the gloomy picture which our C.C.P. friends have painted since long before the war ended. There is in some quarters a complex going back to the days of confederation. There are those people who say that we suffered because of confederation. Many people are beginning to feel that it is more an imagined than a factual consideration. It is true that Nova Scotia is at a disadvantage; we all admit that. We are at the end of a long, slow rail haul and distance makes it difficult to put our products on the central Canadian market. However, there is a trend toward small industry in Nova Scotia. I think it is most unfair to those people who are really trying to do something in the maritimes to have this picture of gloom painted time after time in this house and publicized across the country to give the impression that nobody is trying to do anything. Actually a great deal of good wrork is being done day in and day out.


Clarence Gillis: They are not permitted to do anything.


Robert Henry Winters: The hon. member for Cape Breton South sits in his seat and smiles when I say that a great deal of good work is being done and I think he does not believe that. Probably he does not believe that in my constituency there is a great resurgence in the spirit of the people. They have settled down to business. Many undertakings have been started in Nova Scotia through private enterprise. In other instances, substantial businesses have been started with government assistance. Hon. members know what has been done in the way of cold storage plants in the Annapolis valley which were established by a combination of government assistance and private enterprise. Cold storage plants for the fishing industry have also been set up. As we all know, the fishing industry is in a critical position at the moment because of the grave danger of oversupply. Inventories are high. I think, if the plant had been established on the wharf which the hon. member for Cape Breton South talks about, the difficulties in that particular field would still not be overcome.
In connection w'ith public works, I think anyone who examines the estimates for this year will say that Nova Scotia has not fared

too badly. I can see no grounds for saying that this government has not cooperated in the interests of Nova Scotia. The hon. member for Cape Breton South is not in position to know all this government has done, because of his predicament as a lone member of his party. There is a great deal to be done in Nova Scotia; we all acknowledge that. There is that important project which my hon. friend speaks of so often-the causeway across the strait of Canso. That is something we all want to see go forward because it would create employment and result in lasting benefits. The hon. member for Royal (Mr. Brooks) said he did not believe that the type of solution advocated by the hon. member for Cape Breton South would be the lasting answer to the problem and, generally speaking, that is true. We will not accept temporary solutions when we can have more in the way of permanency.
A causeway across the strait of Canso would provide an economic channel between Cape Breton and Nova Scotia to central Canada, and we are all in favour of it for that reason.
I do not intend to make any extended remarks at this time; I simply wanted to dispel some of the feeling of gloom which the hon. member for Cape Breton South so constantly sheds over this house. Every hon. member, whether he is from Nova Scotia or elsewhere, knows that the situation is serious, but there is no lack of cooperation. If we look at the bright side of this problem and fight it together we shall come out on the winning side.


Wilfrid Garfield Case: Mr. Speaker, it was my privilege last fall to visit the maritimes for the first time, and I feel I would be remiss in my appreciation of those great provinces if I did not put in a little plug for them at this time. I want to follow along the lines advocated by the hon. member for Halifax (Mr. Isnor), the hon. member for Queens-Lunenburg (Mr. Winters) and the hon. member for Royal (Mr. Brooks). I feel that anyone from the maritimes need make no apologies for their great community. We travelled through New Brunswick, on to Prince Edward Island and then through Nova Scotia.	, .
Anyone who is privileged to visit those provinces is bound to be impressed by the wealth of resources of the people. They have a wealth of natural resources; there are timber resources, natural industries, the dairying industry, the mining industry and, above all, there is the wealth they have in their people.

Unemployment in Maritimes
In Halifax particularly I noticed the possibilities of that great city, one of the finest harbours in the world, and that must mean something to the national life of this community. And beautiful Prince Edward Island; I always refer to it as a little spot of heaven. I do not think there is any more beautiful place on the face of the earth. But I can appreciate something of the feeling of being cut off from the rest of the community. Therefore I say to the maritimers that their greatest problem is one of transportation. As a member of one of the central provinces I would say, with all sincerity, that if we can lend a hand together to do something with respect to the equalization of freight rates and greater opportunities for the maritimes- because, after all, we owe a lot to them; they are a part of confederation; they are entitled to our best consideration-we should do so in order that they may, in turn, develop their wealth of resources of which I have spoken, and I have only barely touched on them.
I shall never forget my journey through the beautiful Annapolis valley where at that time they were harvesting millions of bushels of the finest apples in the world, and on through the Saint John river valley in New Brunswick. It would be worth while if hon. members could enjoy the same opportunity to visit that which is part and parcel of our great country, the three important provinces down by the sea, that we might, in turn, have a greater appreciation of each other and of each other's problems and lend a hand so that they, too, will share in what is considered the prosperity of the central provinces.
I am not going to labour the point that they were robbed as a result of confederation, but I certainly do not feel that they got entirely a square deal. Those of us in this parliament and those of us who are interested in the welfare of this dominion from the point of view of national unity and otherwise and its general prosperity should do our best to correct these wrongs.
Why should we be paying subsidies or imposing high tariffs on certain protected products when the same might be manufactured in our own country and particularly with the ingenuity, enterprise and enthusiasm of the maritimers? I feel that much of their economy could be entrusted to themselves if they were only given a fair and square opportunity to compete with the rest of Canada.
Therefore, on this occasion, I should like to pay my warmest tribute tonight to the people whom I met in the maritimes and tell them how much I admire their great provinces and how much confidence I have in the enthusiasm and ambition of their people. I believe it is up to us, who to some extent probably enjoy more physical advantages, to share those advantages with those who may be less favoured in the other parts of our dominion and at least bring to them an opportunity to enjoy an equalization in transportation rates and an improvement in transportation facilities, so that together we may play our part, not only in the onward march of civilization, but in the future development of this country in order that national unity will become a reality and not a myth; that we together may make Canada that country which we have indicated, by words if not by deed, we believe is possible for its people. But I cannot visualize a great Canada if some parts of the country are left neglected and are not given opportunities to develop themselves according to their own abilities and to enjoy the advantages they otherwise would enjoy. I really appreciate this opportunity to pay my compliments to the members from the maritimes and particularly to the maritimers themselves, and to say that I am wholeheartedly in favour of anything that will benefit their lot within confederation.


Arthur Leroy Smith: Mr. Speaker, I have no intention of entering into this competition which was started by the hon. member for Royal (Mr. Brooks), followed by the hon. member for Halifax (Mr. Isnor), the hon. member for Queens-Lunen-burg (Mr. Winters) and the hon. member for Grey North (Mr. Case) with respect to the physical aspects of the maritime provinces, the wonderful character of the men, the beauty of the women, the health of the children and all that sort of thing. I know the Annapolis valley in apple time is wonderful; I know the Bras d'Or lakes are tremendous, but I am inclined to come back to the hon. member for Cape Breton South (Mr. Gillis) and say that a lot of these things you just cannot eat and they do not buy you a great deal of clothing. Beauty is an amazing thing to a man who has a full stomach but does not taste so well to the man who is hungry. Therefore I intend to devote myself to only one aspect of this picture, namely the situation in the coal mines in the maritime provinces. What is the story? We had a strike which, according to all the newspapers-and it has never been denied-cost these miners $5 million. We of this House of Commons have been asked, and have responded in a very humble way in doing a little bit down there, but it does not even mean a drop in a very large bucket.
Inquiries oj the Ministry

Then we read in the newspapers-and we were all very happy-that this strike had been settled. An increase of SI.40 a day had been granted and another probable increase on the basis of increase in tonnage in the next year. These were the facts given to us, and all the men went back to work. Then in a few days they were again out on strike. I had thought someone would ask for a statement with respect to that situation. The only information we got is that there is a difference in interpretation of the settlement agreement. I do say, with great respect, that when it comes to a matter of interpretation of an agreement arrived at between two people and a disagreement arises, any labour department that is worthy of the name could go in and give the proper interpretation and stop this nonsense which is going on in Nova Scotia at the present time. This is the second strike over an interpretation of some little clause in an agreement.
It seems to me that we are entitled to a complete and full statement as to the situation. At the moment it is no use worrying about something that cannot bring immediate results. A settlement of the strike will bring practical results, because the men will be earning money again and the basic industry of Nova Scotia, which is coal and steel-nothing else compares with it-could get going. If that cannot be done by the intervention of the labour department, may I repeat that it is of veiy little value. Let us get that done, let us get Nova Scotia rolling in this month of June. Then we can develop our oratory as best we may, as long as our lungs last, in describing the beauties of that excellent part of the Dominion of Canada.


Paul Joseph James Martin: I am sure that we have listened with close attention to what has been said by those who have taken part in a debate which I would have preferred taking place tomorrow night or some other day. However I want to assure those who took part in the debate that I will bring it to the attention of my colleagues, the various ministers connected with several of the matters referred to by hon. gentlemen, and the government will continue to give these matters its serious and active interest.
I need only remind the house that the observations made by the hon. gentleman who has just spoken, observations that I am sure we have all noted with great interest, will be brought to the attention of the Minister of Labour (Mr. Mitchell). May I remind him that when the Minister of Labour did give his interest to this matter he acted in such a manner as to receive commendation from
the hon. member for Cumberland (Mr. Black), who is unfortunately not in his seat tonight because of illness. The government is interested in this matter. It is interested in seeing that the economy of this country in all its aspects works to the point of giving to its people the opportunity of as full a life as possible. I can only say, Mr. Speaker, that these matters will be continuously and continually receiving the attention of the administration, and I trust that I may now proceed to my own estimates.
Motion agreed to and the house went into committee of supply, Mr. Golding in the
chair.



DEPARTMENT OF THE SECRETARY OF STATE

[Stage Direction]
366. Departmental administration, $126,198.
Paul Joseph James Martin: Stand.


Donald Methuen Fleming: Mr. Chairman, this was not the arrangement at all.


Paul Joseph James Martin: It was arranged last Friday that we would go into two departments. The hon. member for Davenport will corroborate that.


John Ritchie MacNicol: That is right.
. Mr. MARTIN: As soon as we call the items in these two different departments we shall let them stand and go on with national health and welfare.


Donald Methuen Fleming: My point is that we should not be going inito these other departments now but should be going on with national health and welfare. That was the understanding with the hon. member for Hastings-Peterborough.


Paul Joseph James Martin: This is no violation of that understanding. I undertook thait we would go into supply again tomorrow night. The hon. member for Davenport will, I am sure, corroborate that the procedure we are following is correct.


John Ritchie MacNicol: That is right.


Donald Methuen Fleming: What is going to happen tomorrow night? Is the minister proposing to call two new departments tomorrow night?


Paul Joseph James Martin: No. We shall take either agriculture or health and welfare.
Item stands.



DEPARTMENT OF TRADE AND COMMERCE

[Stage Direction]
379. Departmental administration, $246,417.
Item stands.
[Stage Direction]
Supply-Health and Welfare

[Stage Direction]
200. Departmental administration, $531,954.
Mr. WRIGHT:: I wish to ask the minister some questions on administration as it applies to the family allowance.


Paul Joseph James Martin: May I suggest to the hon. gentleman that if he has any specific question relating to any particular item he might wait until the item is called. On the administration item the practice is, if any hon. gentleman wishes, to make a general statement. In the interests of economy of time and clarity and completeness of discussion, it is desirable to put questions on each item as we come to them, when I shall be glad to answer them to the best of my ability.


Mr. BLAIR:: In speaking on the health and welfare estimates, I find it difficult to understand why more time is not spent on the question of health in this house. We can spend hours and days in discussing the question of defence or a potential enemy of Canada; yet disease is the greatest enemy of this country. It is constantly attacking our citizens, and the only time we have to allot to health in this parliament is a few hours when the health and welfare estimates come up. But all the time this major enemy of the people is constantly attacking them.
The most important asset of any country is its people. The only sound foundation upon which a prosperous and happy nation can be built is the good health of each of its members, and the health of the country and the health of the people should be the primary concern of the government. The ultimate objective of public health should be to bring to everyone an equal opportunity to attain physical and mental health, regardless of race or economic status. During the war years, economic conditions were, on the whole, favourable to public health. However, certain adverse factors also played their part. Public health services often had to be reduced because of shortage of personnel. Medical and nursing services were inadequate in many localities, and the expansion of public health facilities were greatly slowed down. There are six main factors necessary to a proper health programme. I shall tabulate them.
1.	Government financial aid and direction.
2.	Research.
3.	An educational programme, in order that public support may be given to the plan.
4.	Sufficient hospitals and other institutions concerned in the care of the ill.
5.	Sufficient doctors, nurses, and trained assistants to carry out a health programme.
6.	The amalgamation of all organizations by government authority.
Costs of medical care of all kinds have increased tremendously during the past twenty-five years, as new methods of diagnosis and treatment have been discovered. Costs of medical services are increasing, but the ability of the people to pay is not increasing. Medical science is making great strides, but the application of medical discoveries has not made progress in the treatment of all the people. It is the duty of the community and the state to care for the poor and unfortunate who are unable to seek or procure proper attendance. Unfortunately, people in the lower income brackets, who formerly were able to pay for medical attention, are no longer able to do so on account of the high and increasing costs of hospitalization and attendance. Even in the most severe illness, they cannot afford the necessities such as special nurses or hospital services. Unless an illness is acute, these people are forced to neglect chronic conditions for financial feasons. It is regrettable that children belonging to these families cannot have defects corrected at a time when such correction would be most beneficial to them. The development of good citizens in a country like Canada is of the greatest importance, since the future of the nation depends on the physical, mental and moral health of the young people.
We are entering upon a new era in the fight against disease. To be successful, it will call for unselfish leadership, the cooperation of the whole medical profession, and the interest and financial support of our citizens. All interested bodies should work together in promoting the health services we visualize. While important discoveries in treatment have been made over the past decade, yet problems such as cancer remain to be solved. Unless we find good researchers, and provide laboratories and funds for them, it will be difficult to reduce the tremendous sums spent annually on disease in this land. It will require the highest standards of scientific talent, supported by adequate facilities as well as finances. The medical research scientists of Canada are second to none, and I firmly believe that our Canadian scientists who have solved many problems in the past could, if given opportunities and financial help, find the clue to a cure for cancer.
Demands for government intervention are increasing with respect to the treatment and control of cancer. There has been a new impetus and a new hope of success in the war against this disease. It is a great misfortune that a sum of $500,000, known as the
Supply-Health and Welfare

King George V cancer fund, placed under the control of the government to advance cancer research-


Paul Joseph James Martin: I am sure the hon. gentleman does not mean to say it was put under the control of the government.


William Gourlay Blair: The government were the
trustees of this fund.


Paul Joseph James Martin: No. The trustees were
the Prime Minister, the Leader of the Opposition, the Chief Justice of Canada, the Minister of National Health and Welfare, one lay gentleman who represented the insurance bodies, Professor Boyd of the university of Toronto, and Doctor Dube, Dean of Medicine at the university of Montreal.


William Gourlay Blair: I stand corrected on that,
but the object is the same. This fund was not used for a period of twelve years except for small amounts which were given out from it at intervals, without a really definite programme in view. The point I wish to make is that during the twelve years when this fund was not in use, approximately 156,000 people in Canada died of cancer. I am glad to say that, at long last, the trustees of this fund have awakened from their comatose condition and have come to a state of realization of the health needs of the nation.
Cancer research at the present time is very small in comparison with the casualty list caused by the disease. Although cancer is regarded as the greatest problem confronting medical research today, only a small amount of money is spent for investigation in this field in comparison with the number of cancer cases. Any attack that we make on this problem must be a long-term attack. Education must be an important factor. An educational programme should emphasize ability to procure treatment for cancer. There is no point in emphasizing correct treatment for cancer unless there are chances to obtain it. We must see to it that opportunities for early diagnosis and successful treatment are available to both the physician and the patient. Better and more extensive facilities for the treatment of cancer are required if we are to bring this terrible disease under control. Cancer is a non-contagious disease.
Approximately 15,000 people die of this disease each year in Canada. While the mortality is high, we must take into consideration the years of suffering and pain for the unfortunate patient afflicted with cancer. The real tragedy lies in the fact that at least one-third of these cancer deaths occurred because the patients themselves failed to recognize the signs and the symptoms of the disease when

it was in its early stages. They did not seek medical advice in time to have successful treatment. In sharp contrast, and most encouraging, are the patients who recognized the disease early and, with the help of their family physician, were given the full benefits of surgery or radio-therapy and, as a result, continued to enjoy good health. The public should be educated to the fact that, while it is possible to obtain complete cures in the early stages where the disease is located externally on the body, yet in a large proportion of the cases the cancer is located where present-known treatment cannot effect a cure. We cannot disillusion the public mind that the only reason which has prevented treatment and research has been a matter of costs.
There is one encouraging thing in so far as cancer is concerned. I note in an article in the Toronto Telegram of June 2, 1947 giving the causes of deaths in the city of Toronto, that whereas cancer killed 115 persons in the month of May of this year, 148 died of cancer in May of last year. I think the average in a city of that size would keep up; and I believe there is some cause for congratulation in the fact that the number of deaths from cancer has dropped even by this small amount.
I come next to tuberculosis. It must be considered as a disease which killed one out of every four persons dying in the age group from sixteen to thirty-nine years. From September, 1939, to June 30, 19441, tuberculosis killed more Canadians in Canada than were killed#in all the theatres of war. There are certain facts about tuberculosis which should be recognized. First, in the last ten years sixty per cent of the deaths from tuberculosis occurred in the most productive age group of life; that is, from twenty to forty-nine years; and over sixty per cent of all patients entering sanatoria for treatment are in this age group. Second, the average cost-and costs are important-including hospital care and loss of wages when a male wage-earner is incapacitated because of tuberculosis, has been estimated at $5,400; when a female wage-earner is incapacitated, the cost is $5,000. Third, the cost to the taxpayers for assistance to a family because of tuberculosis has been estimated at $2,800. Doctor G. C. Brink, director of the division of tuberculosis prevention in the department of health of Ontario, in an article in the Canadian Journal of Public Health, of January, 1946, states:
If we are to wipe out this preventable disease there must he:
(a) Adequate diagnostic facilities, which should include enough mass survey equipment,

Supply-Health and Welfare
and personnel, to make possible an X-ray film of the lungs for every citizen at least once every five years.
(b)	Sufficient beds to permit prompt sanatorium treatment for every person with active tuberculosis.	,
(c)	Adequate public health nursing services.
(d)	Proper post-sanatorium care.
(e)	Social services to make possible a higher
standard of living in families represented by tuberculosis.	,
(f)	Rehabilitation of the handicapped patient.
Doctor Brink further states:
If these facilities were available, the road ahead would be clear, and people in all parts of our country would be protected against tuberculosis.
The pioneering period is over. The result of a planned attack on tuberculosis needs no restating here. There is a new spirit abroad among the people in regard to what can be done to prevent disease, and they are demanding an all-out programme which should be the go-ahead signal to all governments and health departments.
One of the. handicaps in dealing with tuberculosis is the general conception that the disease is now being defeated. It cannot be considered that a disease which kills nearly
6,000	people each year is under control.
Canada can be proud of the progress which has been made during the past few years in reducing the toll of infant and maternal losses. We must, however, carry' on the fight to overcome these unnecessary deaths, and this can be done only through the cooperation of the medical profession, public health officials, Canadian mothers and mothers-to-be, and the public at large.
The maternal mortality rate has decreased from 4-2 per 1,000 live births in 1939 to 2'3 last year. In comparison, I give the figures of
1-	8 in Denmark, 2-2 in New Zealand. 2-3 in the United States, 2-8 in England and Wales,
2-	9 for the white population of the Union of South Africa, 3-1 in Scotland, and 3-3 in Australia.
In our own country the number of deaths in 1944 was 775. The reasons for the decrease in maternal mortality may be. listed as: First, new treatment by penicillin and the sulfa drugs; second, the increased number of births taking place in hospitals; third, education. Better hospital facilities and a continuation of the educational programme would no doubt continue the trend: downward in the mortality rates. The toll of infant and maternal losses could be still further reduced through the cooperation of government health officials and the medical profession. While Canada's infant mortality is the lowest in its history, yet it is still high in comparison with other progressive countries. It could be lower still, because today fifty-five per cent of these infant deaths
occur during the first month of life. If mothers received closer supervision and more attention was given to nutrition, many of these lives could be saved. In 1945 Canada lost 3,156 babies because of prematurity. This represents thirty per cent of all infant deaths. Excellent results have been gained in the treatment and handling of premature babies, but such care is not within the reach of many mothers. The infant mortality rate in the Dominion of Canada in, 1944 shows an increase in deaths from diarrhoea and interitis. The deathrate of children under one year, per 1,000 live births, for 1944 gives the following figures. For Canada as a whole the rate, was fifty-five. For the provinces the rates were as follows:"
New Brunswick	 77
Quebec	 68
Nova Scotia	 54
Manitoba	 49
Saskatchewan	 47
Alberta	 46
Prince Edward Island	 45
Ontario	 43
British Columbia	 40
The number of infant deaths, that is children under four years of age, was 15,511. New Brunswick had the highest rate, with seventy-seven per 1,000 and British Columbia the lowest with 40 per 1,000. Other countries in the w'orld have attained an infant mortality rate of thirty per 1,000. This should be the objective of all the provinces of Canada. It is unbelievable that the Canadian people can view in a complacent mood the situation regarding preventable diseases. The fact that 1,500 babies died each year, in the ten-year period from 1932 to 1942, is disturbing when one considers that these deaths were due to the four major communicable diseases which cause such a high mortality in children; that is, diphtheria, scarlet fever, measles and whooping cough. In one area in Canada with a population of 1,150,000, there were 518 deaths from diphtheria from 1934 to 1943, while in another area with a population of
1,500,000	there were only forty-three deaths. Why should there be such a contrast? Why should this exist? For years we have been putting the emphasis on curative agencies rather than preventive agencies. There is an urgent necessity for immunization against these scourges of childhood, diphtheria, scarlet fever and whooping cough. These diseases are largely preventable, but they still take a toll of disability and death among Canadian children. The maximum number of cases of poliomyelitis in any one year since 1940 is 1,881, with sixty-eight deaths in 1941. This has been an average of 760 cases a year. In the same period there have been 628 deaths from whooping cough alone in a single year.
Supply-Health and Welfare

In this period there has been an average of
17,000	cases of whooping cough, 3,000 cases of diphtheria, and over 17,000 cases of scarlet fever.
We have no means of preventing the spread of poliomyelitis by immunization. There are specific means of preventing diphtheria, whooping cough and scarlet fever. A full programme of immunization could banish these diseases from the country. Immunization by diphtheria toxoid is approximately 100 per cent effective. Whooping cough vaccine protects children and causes immunity in about eighty per cent of those treated. Immunization has proven the best and most effective means of protection against communicable diseases. As an example, I point out that in Toronto there were 2,256 cases of diphtheria in 1920 with 224 deaths, while in 1940 there were none. In the countries of Europe where war has upset public health organization, diphtheria is now showing a tremendous increase. Doctor Hastings, for many years medical officer of health for the city of Toronto, has said, "Every death from diphtheria should demand a coroner's inquest." The statistics regarding the mortality of these diseases have been encouraging generally, but we must remember that the price of safety is a thorough immunization programme. Diphtheria is only slowly coming under control.
The problem of arthritis continues as a major difficulty. Very little progress has been made by research in the quest for a solution. I again remind the committee that there are approximately 600,000 sufferers from this disease in Canada alone, with some completely disabled, and others partly so. I urge that financial assistance be given the new association which has been formed to study rheumatic diseases. While arthritis is not a killer, yet it causes long periods of disability; many of these chronic sufferers occupy hospital beds for months and years, and in many instances have spent all their funds in the hope of a cure. Rheumatic fever still stands as a chief cause of chronic heart disease.
The Canadian hospital council estimates that additional hospital accommodation is required for 40,000 patients. Later, I had a return from the minister in which he set the figure at 27,000 beds. Even with that difference of 13,000 beds, there is a marked demand for additional hospital beds in Canada.


Paul Joseph James Martin: Is the hon. member referring to the return tabled the other day?


William Gourlay Blair: Yes. The lack of hospital accommodation is apparent to any person who has tried to obtain a room in a hospital 
during the last few years. In an attempt to cut down on overhead expenses, hospitals have found it necessary to reduce their staffs, and the nurses are overworked. Unless patients can afford special nurses, often they do not receive sufficient attention. It is estimated that in all branches of the nursing service the shortage of professional nursing personnel now stands at 8,700. Of these, 7,000 are needed for all types of hospitals; 1,200 are needed for private duty, and 500 are needed for public health.
In regard to the question of beds, I quote from an article which appeared in the Globe and Mail of May 27. It is a dispatch from Niagara Falls; and this is the common thing we hear all over Canada in regard to hospitals:
Niagara Falls, May 27. Major Robert Buckner, 'business manager, told the Niagara Falls hospital trust tonight that the women's ward in the new wing has been closed for lack of nurses. "It may be necessary to close the men's ward in the new wing," he added.
The shortage of nurses today is due to the fact that the rate of increase in the number of nurses graduating has not kept up with the rate of increase in the demand for additional nursing service. The rate of admission to hospitals, according to the population throughout Canada, has greatly increased over the pre-war rate. In Ontario hospitals, the admission rate is more than sixty per cent higher than in 1931. In the event of an epidemic such as influenza, our position in Canada would be hazardous. We must remember that in the influenza epidemic of 1918 we lost 30,000 people in the Dominion of Canada. This is something we simply could not cope with at the present time.
Environment, especially during childhood, is a requisite of health. Unsanitary houses providing poor shelter are conducive neither to health nor to good citizenship. The ratio of sickness is higher in the slums than where the people are well housed.
There are widely different standards of health between one province and another. Under section 91 of the British North America Act, the health of the people is the individual responsibility of each province. There is an inequality in various fields such as public health or tuberculosis control as between provinces, and as between urban and rural areas of provinces. At this time it would be impossible to tabulate all the requirements of an adequate public health program for the dominion.
I hope I shall not be accused of advocating expenditures. I do not think there is one

Supply-Health and Welfare
member in the house who would consider it an extravagance to spend money where human life is at stake or for the relief of suffering.
I have discussed the necessity for research and the lowering of the mortality rate in cancer, preventable diseases, maternal and infant mortality, and tuberculosis. I have drawn attention to the serious shortage of hospital beds and trained personnel. Again I refer to the fact that the cost of sickness is becoming beyond the means of many people. The solution of these urgent health problems is, therefore, an adjustment among all the provinces and the dominion. The two largest provinces have not yet reached an agreement, although the premiers of those provinces have requested another dominion-provincial conference.
In view of the situation I have described regarding the over-all health picture in the dominion, the Minister of National Health and Welfare (Mr. Martin) should be the first to raise his voice in demanding a renewal of the dominion-provincial conference. If by the calling of another conference the life of even one child of a Canadian citizen could be saved, then there should be no hesitation. A grave responsibility rests upon the federal government.


Paul Joseph James Martin: I am sure we have all listened, and with great profit, to the address we have just heard. Let me say at the outset to the hon. member that the temper of his observations and the constructive nature of his suggestions are in keeping with the kind of cooperation which, as an eminent member of the medical profession, he has given to me since I became Minister of National Health and Welfare. While there may be one or two points on which it may be expected that we shall have different points of view, I want him to know that I shall follow with great interest, not only the speech he made tonight, but also the excellent speech he made in the house early in the present session of parliament.
I would not be doing my duty if in my first observations respecting the estimates of the Department of National Health and Welfare I did not pay what I think the committee generally will recognize as a deserving tribute to my predecessor, the present Minister of National Defence (iMr. Claxton), who took over this department when, on the welfare side, there were new assumptions of responsibility which might well have taxed the ingenuity, energy and imagination of any man given that particular portfolio. Might I add that, while the w'ork of this department is not such as to engage the headlines, it is extremely important and complicated. Mj1- daily expedience confirms my earlier judgment of the great contribution my predecessor has made in-this department.
The hon. member who has just spoken has pointed, and quite properly, to the general health state of this great country of ours. He will not think me unfair, I hope, if I add that in his statement he did not draw the lines which, ag Minister of National Health and Welfare, I must draw in respect of the constitutional distribution of powers and responsibilities of the federal government with regard to many of the matters he has discussed. But I do agree with him, and I say to the committee that, while we spend a great deal of time in the discussion of many matters, perhaps there is no field of governmental endeavour on the federal level which touches so directly the welfare of the people of Canada as does this department.
The hon. member referred to arthritis, and perhaps later in the estimates I shall have more to say about this specific item. But I may tell him-and I announce now-that the technique we employed early in January in calling together here in Ottawa, the capital city of our country, those who were interested in cancer control, will be employed again when all the authorities, governmental and professional, in the field of arthritis, are called within a very few months, to see if we cannot provide some coordinating authority to carry on in the field of arthritis; as I ultimately hope to show we did and have done in the important field of cancer.
I am sure hon. gentlemen will regard what I am now saying not in any sense as an expression of political partisanship, because I hope we can follow the lead given by the hon. member who has just spoken in looking at this matter as one which should not divide us on a political basis. Through the officers of my department I have had an opportunity of consultation with Lord Horder who, as hon. members will know, is one of the outstanding authorities in his profession in the rheumatic field, and who has in Great Britain set up a number of investigational clinical centres for the treatment of this malady.
Likewise, Doctor Wallace Graham of Toronto, an eminent physician in this particular field, has also been in consultation with the department. These two sources, to whom I have referred, together with the Canadian Rheumatism Association, will be the basis of a conference which, I hope, will lead to an examination of all the possible avenues available to bring about some relief in respect of this painful affliction.
Supply-Health and Welfare


John Ritchie MacNicol: May I ask if the medical departments of the provinces cooperated?


Paul Joseph James Martin: Every one of the provincial departments of health cooperated. I was anxious to learn from them, as I am sure every hon. member would be, whether or not our maximum effort was being put forward to eradicate this disease or whether, as I suggested a moment ago, we were only making a piecemeal attack on a great national hazard. I learned that -what has often been referred to as the war against cancer was not a total war. The campaign was, in reality, a series of local attacks, many of them magnificently fought, nevertheless not capable of justifying the designation of an all-out national campaign.
There was the lack of research workers, the lack of laboratory facilities, the lack of coordination of effort, and particularly the lack of the instruments, material and human, by which we could at least say that we were putting forward our best effort. It became apparent as well that the public conscience was uneasy and that the time was ripe to mobilize our entire efforts in some sort of unified or coordinating command or body. The moment had come, it seemed to me, and it seemed to them, when a concerted, well-organized and a properly directed attack on cancer should be pursued. It was generally recognized by those who wrere there, men like Doctor Charles Best, one of the great collaborators and co-discoverers of insulin, and Doctor Collip and others that I could mention who have
made a contribution in one field or another in medical scientific research, that no advance could be made until we had some sort of intelligence report. They canvassed the problem from every angle, and after two days of full discussion preceded by ex parte reports and submissions, we were able to arrive at a full measure of agreement. First of all, there was a discussion as to what was being done in the field of education. We reviewed the extent of scientific research at present being carried on at the universities. We heard reports about the facilities set up in the provinces for diagnosis and treatment of sufferers of cancer, and we inquired into the reasons why so few young men were willing to devote themselves to full-time investigation of the causes and cure of malignant growths.
Then our attention was turned to the urgent necessity for assessing the whole problem by means of surveys and the need for adopting some form of uniform reporting, not only of deaths from cancer, but also the data about cases that have been diagnosed, treated and saved from dying. Lastly, and perhaps of most importance, ways and means were explored by.which an adequate campaign against cancer could be waged. The conference moved unerringly towards one objective. When we talk about the problem of unity in this country I think of medical men and laymen from all provinces working together so that problems in Canada may be solved. I think, for instance, of Doctor Simard of the university of Montreal, and I think of Doctors Vezina and Bergere of Laval collaborating with men like the former dean of the School of Medicine of the university of Western Ontario, Dean Hall, now president of the university; I think of men like Best and Collip and the dean of McGill and so on, all working toward a common objective.


Mr. POULIOT:: And Doctor Adelard
Groulx and Mayor Camillien Houde of Montreal.


Paul Joseph James Martin: One had the impression there of what could be done to meet the objectives of the hon. member for Lanark (Mr. Blair), that this is a problem which should engage our full cooperative effort on all levels of government and of all classes in the community.
We moved unerringly forward to a single objective, namely, that we should formulate and direct a national cancer control programme. It was decided to set up a body that is now known as the National Cancer Institute of Canada. May I say at once the word "institute" may conjure up in the minds of
Supply-Health and Welfare

some the idea of brick and mortar. That, I can say, is not and was not the intention of the founders of the institute. That sort of thing may come later, but an effort will be made first to try to bring about in the three avenues I have mentioned some control of this dreaded disease. No one can guarantee that the efforts of the institute and the work that they may project will succeed; but we should be able to say, I trust, after some years of experiment with this particular technique, that we have done all that we know how as human beings to try to meet this problem.
The institute, I may say, as a result of their own decision is a non-governmental body, non-profit making. The men and women who had come from all parts of Canada decided that it would be better to have this institute modeled along the lines perhaps of the Imperial Cancer Institute in Great Britain and corresponding bodies in the United States which are non-governmental. There was, however, proper acknowledgement of the part which both provincial and federal governments made in initiating the conference. It was thought that cancer control is dependent upon many factors; first, that there is a serious shortage of young scientists in Canada who are qualified or trained in the technique of cancer research. This includes both men and women in, laboratory or clinical investigation teams. The reason, is apparent. Young graduates in medicine, biology and the physical sciences find that they have to make a living after graduation. This they cannot do on the grants which are available to them through various organizations at present sometimes dispensing aid to research. The universities in many instances are not sufficiently endowed to pay adequate living allowances. The national research council has its responsibility and I am sure, when the problem is canvassed, as it is being canvassed, that body will show and continue to show its deep concern and interest in the problem. The final result, however, is that our young graduates, particularly, those with a bent towards research, are being directed sometimes in other quarters and elsewhere where they are provided with the necessary conditions under which they can give their full attention to investigation without worrying unduly over clothing, shelter and food. The National Cancer Institute plans to do something about this state of affairs.
Second-and this concerns physicians and their patients directly-there is a need for reviving the excellent undergraduate and post-graduate educational programme begun by the Canadian Medical Association before

the war. The war made it necessary to abandon temporarily these lectureships throughout the country. Personnel was simply not available with over three thousand doctors in the service.
The founders of the institute declared their belief that the universities, and the medical schools which are actively engaged in cancer research will recruit more research students who have an increasing awareness of their responsibility to professional education. Doctors will be even more enthusiastic in making early diagnosis and in keeping accurate studies of their patients and making close contact with the special treatment centres so wisely provided throughout the provinces.
It w-as the opinion of the conference that some uniform system of reporting cases and deaths should exist throughout the provinces, and steps will be taken to explore this question as it was explored at the last meeting at the Dominion Council of Health. It is thought that, with every physician contributing to cancer research in this way, the problem of cancer control will attain its true perspective.
Third, it is obvious that physicians can diagnose only the cases of those who come to consult them. This is where the splendid work of the Canadian Cancer Society comes into proper focus. As I have said, this organization deserves the warmest praise of everyone in Canada. They have persistently presented to the people the opportunity and the benefits of early diagnosis and the necessity of medical examination.
One of the conclusions of the conference was that the Minister of National Health and Welfare, as one of the trustees of the King George V cancer fund, should address himself to the trustees of the fund to see if the fund could not be placed at the disposal of the cancer institute to enable it to carry on its work. I regretted having to intervene when the hon. member for Lanark was speaking, but I am sure he will agree that I should have intervened to indicate clearly that this cancer fund was in no wise under the control of the government, but that the Prime Minister, the Leader of the Opposition, the Chief Justice of Canada, the Minister of National Health and Welfare, Professor Boyd of the university of Toronto, and one gentleman representing the insurance bodies should be approached as trustees of the fund to see if the claims of the institute for financial assistance did not deserve attention. I may say that the motion moved by the Prime Minister and seconded by the leader of the opposition reflected the determination of the trustees of the fund to see that every initial opportunity was given to the cancer institute to carry on

Supply-Health and Welfare
its work. That has been done. A sum of money on a three-year basis has been turned over by the trustees of the fund to the cancer institute. The president of the institute is Doctor Blair of Saskatchewan; the vicepresident is Doctor Simard of Montreal. Then there is Doctor Low Little, an eminent physician of Guelph and lately of the Department of National Health, who has taken over the active secretaryship and direction of the organization.


Harold Aberdeen Watson Timmins: How much has been turned over to the institute on a three year basis?


Paul Joseph James Martin: Four hundred and fifty thousand dollars. The idea is to give #150,000 each year for a three-year period. At the end of the first year the directors of the institute are to appear before the trustees and indicate how they have expended1 the funds.
I simply make this observation and I say this as one who has no official connection now with the institute. My part in it was humble, that of calling a conference together and giving it an opportunity, by virtue of the particular portfolio which I hold, of trying to bring about some decision in the field of coordinated activity and effort.


John Thomas Hackett: How much is in the fund?


Paul Joseph James Martin: Approximately $490,000 I think, but the institute has been given $450,000. I now speak not as a member of the institute because I am not, but as one who is anxious to see the institute do its job so that no stone will be left unturned. It is important that the beginnings be sound. Whatever assistance comes from the dominion or provincial government-and I am not now making any statement with regard to contributions; that I will do at the proper time- it will be recognized, I am sure, that whatever assistance is given a large sum of money will be needed over the period, and there will be large sums needed if the research projects contemplated by the institute are to be undertaken.
One of the great avenues of assistance will be not only from official but from private sources. I can say at this juncture without in any way breaking confidences that already individuals in this country have shown themselves anxious to make their contribution toward the remedial efforts of one of the greatest maladies known to man, and whenever the institute makes its decision as to the form and nature of its appeal I am sure it will find all groups in this country anxious to make the work of the institute a notable success.
The future of the institute is in the hands of the professional and lay men in this country interested in this problem. I can only say at this juncture that I have exhibited, and I say this humbly, on the part of the department a real interest and a determination to see that we do everything to try to meet this problem.
I think the other matters to which the hon. gentleman referred can be dealt with as we proceed. I want to thank him again for giving me an opportunity to make a statement which I think is of great importance and to say to him how much I appreciate the kind of contribution he himself made tonight.
Mr. TIMMINS; I am sure the committee thanks the minister for his remarks in respect of cancer and the programme of the government with regard to the national cancer institute. There arise out of his remarks some questions with which I should like to deal.
It is quite clear that the King George V silver jubilee cancer fund contains at the present time only $490,000, and the minister stated a few moments ago that $150,000 a year is to be turned over to the institute in each of the next three years. I presume that this money will be used, for the most part in educational work, with a good portion of it being used for research, because that seems to be the matter with which the cancer institute will mostly concern itself.


Paul Joseph James Martin: I do not quite agree with that statement of the functions of the institute as declared by the institute. I just want to make that reservation.


Harold Aberdeen Watson Timmins: I have before me a return which was made by the minister's department on the 29th of May, in which the question was asked as to the annual expenditure in 1935 to 1945 through the national research council directed at finding the cause and cure of cancer, and the answer given in the return had this to say, among other things:
Any person qualified to direct medical research and having the required fundamental laboratory facilities at his disposal-


Paul Joseph James Martin: If the hon. gentleman will permit me, he is referring to something else altogether. I was talking about the institute. He is now referring to the medical division of the national research council.	[DOT]


Harold Aberdeen Watson Timmins: Yes.


Paul Joseph James Martin: I do not like to interrupt my hon. friend's statement. I perhaps did not state clearly the aims and objects of the institute. They are:
Supply-Health and Welfare

1.	To coordinate and correlate the efforts of individuals and organized bodies with a view to reducing the morbidity and mortality from cancer in Canada.
2.	To aid in establishing and maintaining or to establish and maintain fundamental research activities in the field of cancer.
3.	To assist in the training of prospective scientists who may be interested in the field of cancer research by the award of fellowships for this purpose.
4.	To collect, assess and disseminate scientific knowledge and material relating to cancer.


Harold Aberdeen Watson Timmins: I thank the minister for his interruption. The return to which I am referring has to do with applications made and taken care of by the national research council. During the period of some ten years it appears that the national research council spent some $4,364 on cancer research. I would ask the minister this question. Is it not to be assumed that the duties of the national cancer institute will override the former powers and the former work of the national research council in respect of cancer? Will the cancer institute take over the work which formerly the national research council did in regard to cancer?


Paul Joseph James Martin: To some extent, with the cooperation of the national research council.
1	regret to have to say that my colleague the Minister of Veterans Affairs has an important motion to make and has to leave before eleven o'clock. I trust the committee will allow him to intervene at this time.
Progress reported.



BUSINESS OF THE HOUSE

Ian Alistair Mackenzie: Under standing order 45, I should like to move, seconded by the Minister of National Health and Welfare (Mr. Martin):
That the house meet at 3.30 p.m. on Wednesday, June 11, notwithstanding standing order
2	in relation thereto.
That is in order to give our colleagues in the House of Commons an opportunity of meeting our distinguished visitor.


[Stage Direction]
Motion agreed to.
On motion of Mr. Mackenzie the house adjourned at 10.55 p.m. until Wednesday, June 11, at 3.30 p.m.