OLD AGE PENSIONS

[Stage Direction]
Mr. W.G. RAYMOND (Brantford) moved:
That the recommendations contained in the report of the Old Age Pensions committee be concurred in.
He said1: I may say for the information of those members who have not had time to look into this matter that the committee has given the most careful attention to the replies received from the premiers of the various provinces, and has found that the provinces of the Dominion were not inclined to enter into the proposition as outlined in the report. Some suggested that it was a matter entirely for the federal government and not for the provincial governments at all. As hon. members will find by referring to the report, the matter was referred to the Department of Justice, which department forwarded a very clear and concise opinion, in which it was stated that it was rather a matter for the provinces than for the federal government; but that the federal government might contribute to the funds required if they saw fit to do so. We thought it better to make the recommendation contained in our
report, rather than to take the matter up alone at the present time, as it would involve too much expense. It would necessitate an annual expenditure of a large amount of money, and we have therefore recommended in the report that the government arrange for a meeting with the premiers of the various provinces during the recess, with a view to arriving at a scheme for a co-operative o!d age pension; and secondly, that the chairman and one other member be invited tc attend this conference; and thirdly that this report be sent to the premiers of each province. Hon. gentlemen will observe that the recommendation involves no expenditure and no responsibility further than the continuance of the idea of establishing in Canada an old age pension system, which the committee think is very desirable, and would like to see it proceeded with. Therefore the committee has made this recommendation as the most feasible manner of dealing with the matter.
I do not think it is necessary now to go into the general question of old age pensions. I think we have arrived at that degree of advancement and civilization in this country when it is generally conceded, that we are lacking in this matter, and that we should have an old age pension scheme in Canada. This government has taken the -initial step and we hope the matter will be proceeded with and prosecuted until it arrives at a successful conclusion in a co-operative movement between the federal government and the provincial governments.
Mr. WILLIAM IRVINE (East Calgary):: I wish to express my personal disapproval of the report of the committee and to give briefly my reasons for disapproving. I think this committee has been working on a wrong line. It has been endeavouring to arrive at some scheme of old age pensions that would embrace the voluntary co-operation of the provinces. We have been instructed by the Justice department that we cannot constitutionally pass legislation that would be obligatory on the provinces. Still the committee persists in its course. I presume that if all the provinces of Canada voluntarily accepted the committee's proposal we might possibly obtain an old age pension scheme along the line of the committee's report, but I do not think that any member of this House will anticipate that all the provinces of Canada will agree to such a scheme anywhere this side of the next thousand years. I do not think there is the slightest possibility of getting an old age pension scheme along the lines of the proposal of the committee. I do not say of
Old Age Pensions

course that the committee has not been perfectly sincere in its quest and in its recommendations, but if hon. members will go over the replies which have come to us from the premiers of the various provinces it will be found that nearly all consider old age pensions entirely a federal matter and will have nothing to do with it. The provincial governments point out the injustice which would come to the provinces which would not come into the scheme, and consequently, if we are to pay any attention at all to the advice of the provinces, we will abandon the scheme suggested by the committee, and proceed at once with a scheme which would be entirely federal, leaving the responsibility on the federal government. We have been told by the chairman of the committee (Mr. Raymond), that the committee does not consider that Canada can stand the financial pressure involved in raising the moneys required to carry out this old age pension scheme; the committee, however, think it could be done if the provinces came in. It is surely clear that it would take the same amount of money whether the provinces came in or not, and the taxpayers of Canada are not so foolish as to imagine they pay any less if they pay part of it through the imunicipalities, part of it through the provincial government and part of it through the federal government. They know perfectly well that if they pay so much in taxes, they pay the same amount no matter how often you divide it. On the other hand to say that we cannot afford it is a confession which I, as a member of this House, do not wish to concur in. I believe we can afford it; but if it be so that we cannot afford it, let us frankly say so and not continue making a pretence that we are on the way to obtaining old age pension legislation by referring the whole question to a conference.
I think the report of the committee recommends that at a meeting to be held this summer; when the provincial premiers are in conference with the federal government in respect to constitutional! amendments, this matter is to be brought up.. And a report is to be given ait the next session of parliament. I do not think instructions given by this session of parliament will be considered binding by another session of parliament. Further, the conference that will be held this summer will have all they can deal with without attempting to deal with this matter at all. If they deal with it, it will be in a very cursory fashion which will not be satisfactory. Without discussing this matter further I beg to move:

That this report be referred back to the committee with instructions to consider and report on a purely federal scheme.


Mr. T. L. CHURCH (North Toronto):: 
Mr. A. W. NEILL (Comox-Alberni):: Mr. Speaker, I take exception to the remarks of the hon. member for East Calgary (Mr. Irvine) when he says that the Justice department reported that it would be impossible for the Dominion to co-operate with the provinces in this matter.


William Irvine: I did not say that.


Alan Webster Neill: That is what I gathered
from the hon. gentleman's remarks. Perhaps he will correct his statement.


William Irvine: I pointed out that the Justice department advised us that it was outside of the jurisdiction of the federal parliament to proceed with a scheme such as is proposed by the committee. The hon. member should read the report.


Alan Webster Neill: I take exception to that.
That, to my mind, is not the report of the Justice department. What the Justice department reported was that under the British North America Act the duty of functioning an old age pension scheme devolved primarily on the provinces, but it said that it did not

Old Age Pensions
preclude any assistance which this Dominion might extend by way of voluntary grant, but that it would not be possible for it to establish and operate a scheme under its own auspices if it involved any measure of compulsion. That is to say, if it required the provinces to pay so much or if it required the individual to pay so much, then we would be exceeding our jurisdiction. It, however, expressly left the door open for any assistance by the Dominion to a co-operative scheme formulated by the provinces. The hon. member for East Calgary says that he anticipates that this co-operative scheme must essentially be a failure and never come to anything because it will be a long time, if ever, before the whole nine provinces will agree to it. The scheme recommended by the committee last year and again endorsed this year did not contemplate that there should be unanimous action by the provinces; it suggested assistance by the Dominion government to any province, and all provinces, if and when they decided to avail themselves of it. I remember the same remark was made-"You will never get the provinces to come in,"-when this government a number of years ago proposed to vote, I think, $20,000,000 for the encouragement of good roads in the different provinces. It was said that the scheme would be unworkable; that the different provinces would not come in. The matter, however, was left optional; those that wished to come in could come in, and those that decided to stay out could do so. In the final result, I believe they have all come in and taken advantage of the assistance offered by the Dominion government.
I am aware that in the replies received from the different provinces, the tendency was to "pass the buck" to the Dominion government. They all suggested that they did not want to do the work and they did want the Dominion government to do it. But there are two features which will, perhaps, somewhat modify their views now. At that time they were not in possession of the report of the Department of Justice which says that is not our business to assume entirely the burden of any scheme of .that kind and which places the responsibility directly and finally upon the provinces. Perhaps, had they been informed of that decision they would not have taken the position they did, and when they are informed of it they may see fit to change their point of view. That is why the committee recommended that the matter be taken up at the conference which is to be held this fall. The provinces may be given full information of that advice of the Justice department; and when the other features of the matter have 283
been explained to them, they may be led to assume their responsibilities in this regard. My hon. friend from North Toronto (Mr. Church) says, that Britain pays its old age pensions out of the federal treasury. Certainly, but the British government has control of all the taxable resources of the British nation. We do not occupy the same position in Canada. We only control part of the revenues of Canada and the provinces control a very large part. It is true, as the hon. member for East Calgary says, that the expense will be the same, whether the money comes, half out of the Dominion and half out of the provinces, or entirely out of the federal resources. But that is only begging the question, because we are here as guardians of the federal resources, and it is not our function to spend the public money with which we are entrusted in order to succour the finances of provinces whose duty it is to assume that responsibility. While the total cost will be the same, it is not our duty to pay out money for the benefit of the provinces when the British North America Act has decreed that they are to do so. If we once give way on that point, then we shall be asked to assume other obligations-education, for instance-of the different provinces. We must assume some responsibility in dealing with the public money of Canada as compared with that of the provinces.
My hon. friend (Mr. Irvine) takes exception to the fact that this conference has been called primarily for another purpose, that is, to deal with Senate reform. He suggests that there should be a separate conference. But it is very unreasonable, I think, to ask that representatives of the provinces should be called from such vast distances as we have in Canada, specially for the purpose of considering this one subject, when the provinces are meeting together in any case for another purpose. Would it make any difference if they were called a week later, or a day after the conference on the other subject? Surely the same representatives could stay a day or two longer and hold a conference on this question. The suggestion that they cannot discuss it this fall is, I think, an untenable one.
There is no member of this House to whom I would yield in the desire to see an old age pensions scheme gone ahead with. I come from a district comprising workers almost entirely, and I know that such a scheme would be favoured there. At the same time, however, I must recognize my responsibility as a member of parliament to the whole of Canada, and I am not prepared to stand here and, for the sake of a little cheap applause in my constituency, ask the Dominion of Canada to saddle itself with a liability running into

Old Age Pensions

twenty-three or twenty-four million dollars a year. It is an object devoutly to be wished in the future; but at the present time and under our present taxation and financial conditions we are not entitled to ask the government to go into such a large annual expenditure especially in view of the ruling of the Justice department that it is a matter of provincial jurisdiction.
Mr. HANCE J. LOGAN (Cumberland): As a member of the committee which has been considering the bill I have endeavoured to give it my best attention. I am a firm believer in old age pensions; I believe it is one of the great questions before the people of the country to-day. I do not admit that we cannot afford to put such a scheme into effect even if we had to do it federally alone. Australia, which is not as rich a country as this, is able to carry old age pensions, and the sqrne is true of other parts of the Empire and of the civilized world generally. I do not agree therefore that, even as a federal government alone, we could not carry on an old age pension scheme. But I want to see results. To-day the poor are being taken care of by the provincial and municipal authorities and we have suggested a scheme whereby $20 a month will be paid to old people. The committee has recommended that this government provide one-half of the amount, or $10, the provinces to contribute the other half. The proposal has been referred to the provinces and I am bound to say that in my opinion they have replied without having given the matter serious consideration, because I contend that it is in their interests, from the financial point of view alone, altogether apart from sentimental reasons, to accept the proposal. Tinder our scheme they would contribute $10 towards the maintenance of every poor person in the province, whereas under present conditions it is costing them at least $20 a month. The provinces therefore would stand to gain rather than lose if this scheme which we propose were put into effect. I am inclined to think that when the reference was made to the provinces they felt that this was a matter altogether within the scope of the federal authority, and they replied to this effect without giving the proposal due consideration. For that reason I think it is desirable that a conference should be called. And in this connection I would point out that the committee in its recommendation does not ask that the matter be referred to the conference which it is proposed to hold on any other subjects; the suggestion is that a special conference be 
called to consider this particular matter. I believe that if the premiers of the different provinces came together we could convince them that altogether apart from the sentimental reason, the provinces would stand to gain financially if they adopted this scheme; and I have no doulbt that on that ground we could put it through. My hon. friend from East Calgary (Mr. Irvine) thinks that we should go ahead at the present time without reference to the provinces at all. That is more easily said than done. It sounds very well; but it is not practical at the present time. The day will come when such a course will be advisable if the provinces refuse to contribute. But I submit that the provinces have the necessary machinery for carrying on this work, and in our report we recommend that they should distribute the pensions; and as they are nearer to the people to be benefited than the federal government could possibly be, I believe it would be the proper thing to call a special conference between this government and the authorities of the provinces to consider this very important matter and if possible to come to a satisfactory conclusion. I would vote against the amendment of the hon. member for East Calgary for another reason; at this stage of the session, within a very few days of prorogation, it is no time for the committee seriously to take up anew any consideration of this problem. I think it is better to obtain results in a practical way than to vote for motions that are simply illusory, for this is merely throwing dust in the eyes of the people of Canada. What we want is action; we want to put money into the pockets of the needy old men and women of the country. I think a conference with the provinces would surely work out some satisfactory solution of the question and I trust that the result will be the institution of a joint old age pensions scheme.
I am afraid we do not pay sufficient attention to the question of old age pensions. In my humble opinion the prospect that men must face in the twilight of life, without sufficient means to carry on for the rest of their days, is responsible for more pain and anguish than possibly we imagine, and I do think that one of the greatest duties we owe the country, as a federal parliament is to provide for these old people some means of living decently after they have properly contributed their share to the state.
Mr. JOS. T. SHAW (West Calgary): I want to indicate briefly my reasons for voting for the amendment and against the proposal of

Old Age Pensions
the committee. The committee has had this matter under consideration a great many months, not only during this session but in the preceding session as well; and last session, after oommuniiaations had been received from the provincial governments, the conclusion was reached that nothing like unanimity could be secured from the provincial authorities in regard to this scheme. This year apparently, for what reason I do not know, the committee seems to have followed the same path, having tried to secure the consent of the provinces. And again it has failed. I think we all agree as to the necessity for an old age pensions scheme in Canada. There is no one who would not approve of a proposal of that character, carried out in accordance with constitutional necessity. Speaking for myself, while I favour this scheme, I am not going to be a party to loving the proposal to death by referring it to any conference to be called some time in the future. What hope is there of securing anything like unanimity by means of a conference? The committee so far has not secured that unanimity; is there any hope that the conference will secure it?


Mr. GOOD:: Is unanimity necessary?


Mr. SHAW:: I do not think it is; I am coming to that point. Now, just to illustrate what I mean, I want to refer to the summarized answers of the various provinces in Canada to the proposal made by the committee:
New Brunswick. This government does not disapprove the principle of old age pensions. It would be impossible, however, to commit the province to any action in this matter at the present moment, as it is now considering the establishment otf " widows' " pensions.
What hope is there of semiring any consent from New Brunswick?
Quebec. Considering the obligations actually imposed upon the province, there could be no question of adopting a law which would take care of old age pensions at the present time.
That is the attitude of the province of Quebec. Is there any reason for thinking that if a conference were called in the next few months they are going to change their attitude at the request of the chairman of the committee and of some other members of the committee who may then be present?
Nova Scotia. Without a further and better understanding of the subject matter, and without an opportunity to fully discuss the matter with the committee, no action would be taken upon the matter at present.
Prince Edward Island. This province, having no municipal government, furnishes directly all assistance to indigent aged persons. The premier states that the proposal will be considered.
Manitoba. Under date of February 25, 1925, the attorney general wrote that he would take up the
283i
matter with the Premier and the Minister of Public Welfare at the earliest opportunity.
Saskatchewan. This government is of opinion that the scheme can best be adopted by the federal government alone. It points out the difficulty of providing any scheme that would be suitable to all the nine provinces. It also points out that, " if any number of the provinces w'ere to remain out, it would be almost impossible to adopt any scheme that would not subject those provinces within the arrangement to considerable expense that should rightfully be borne by those outside the scheme."
Alberta. This government approves of the general principle of old age pensions, but is not prepared to accept the recommendations of the committee. It points out: (1) that the federal government should assume a larger share of the financing of the scheme as it is more a federal obligation, it states, than a provincial one; (2) it is not satisfied that a noncontributing scheme is the best one; and (3) that there is no guarantee that the federal government would continue for a definite time to carry out the mutual arrangements with respect to its financing.
British Columbia. This government writes that the matter of old age pensions has been carefully considered by the government and also by the provincial legislature, and the consensus of opinion was that the matter is one entirely in the sphere of the federal parliament, and that it did not concur in the suggestion made by the committee that a portion of the cost of such pensions should be borne by the province.
Ontario. Under date of November 24, 1924, the Premier wrote: "I shall be glad to consider this matter."
That is the situation at the present time. Some of the provinces feel that the obligation is on the federal government alone, some are prepared to consider the matter, and some are not. I see no hope of securing unanimity by referring the matter to any conference convened in the future.
Now, the Justice department indicate very clearly the legal position in this matter, according to the report of the committee. The department advises:
The subject of old age pension does not fall specifically within any of the enumerated subjects given to the Dominion under section ninety-one of the British North America Act, but does fall within the subject of "property and civil rights in the province" committed to the provinces under section ninety-two.
The Deputy Minister of Justice adds:
I am of opinion therefore that the subject matter of pensions has been entrusted to the provincial legislatures rather than to parliament. I do not mean to suggest that parliament has not the power to legislate upon the subject so as to assist the provinces or to establish 'an independent, voluntary scheme, provided that in either case the legislation does not trench upon the subject matter of property and civil rights in the province, as for example by obligating any province or person to contribute to the scheme.
If I understand the situation aright, Mr. Speaker, this parliament has no power under the British North America Act to pass any legislation that would impose an obligation upon the provincial governments with respect to old age pensions.
Old Age Pensions


Mr. LOGAN:: Would the hon. member mind reading the balance of the deputy minister's opinion?


Joseph Tweed Shaw: I shall be glad to.
The enactment of such legislation would, however, involve the assumption by the Dominion of obligations involving heavy expenditures with regard to a matter which does not fall specifically within the Dominion field of legislation.
This is, of course, the opinion of the Deputy Minister of Justice, but I have no doubt the scheme would involve a considerable obligation. Now, what can we do, if we want to dio anything? The only course we can take is to pass legislation appropriating certain sums of money and saying in effect to the provincial governments, one and all: If you pass an old age pensions scheme along certain lines, we are prepared to contribute of our resources up to a specified extent. That is the situation as I understand it: it must be an entirely voluntary scheme in order to keep within the provisions of the British North America Act. But this is not the only matter in the same position. Parliament has not hesitated to provide large sums of money by way of a housing scheme and for highway purposes, and the legislation under which the money was appropriated stands in exactly the same category as the legislation proposed in this ease. To my mind it is far more important, and far more imperative, that we should pass legislation for old age pensions that that we should place upon the statute books federal legislation in aid of highways and housing.


Mr. VTEN:: Does not the hon. member recall that we have done away with the subsidies in respect of highways and housing?


Joseph Tweed Shaw: The hon. gentleman may be right in regard to the housing legislation, but this session we have expressly extended the period within which the provinces can secure the benefit of the appropriation for highway purposes.


Thomas Vien: But only for the unexpended portion of the vote.
Mr. 'SHAW: Well, if it was wrong, why did not my bon. friend object to any vote at all for the purpose?


Thomas Vien: I did object.


Joseph Tweed Shaw: The matter of old age pensions is in exactly the same category from a constitutional point of view. In my opinion, it is far more vital, it is far more imperative, that parliament should declare itself on this important matter now. As I said before, I am not going to be a party to postponing forever much-needed legislation of

this character. I agree with the hon. member for Cumberland (Mr. Logan) that action should be taken, and I do not think anything will be gained by delaying it further. If necessary, I am prepared to stay 'here for another month, and I am sure a large number of members are prepared to do the same, in order to see that such legislation as meets with the approval of parliament is passed to put into effect an old age pension scheme.


Mr. M. N. CAMPBELL (Mackenzie):: Mr. Speaker, may I point out that there will be very great difficulties in securing a fair and reasonable working out of any scheme such as is proposed by the committee in their report. We will assume, for instance, that under this scheme the province of Ontario accepted the federal government's proposal and put it into operation, but that the province of Quebec refused to do so. Immediately there would be a hardship on the taxpayers of Quebec because they would thus be compelled to contribute their share towards the operation of the scheme in Ontario without securing any of its benefits themselves. But let me point out how it would operate in regard to individuals. An old couple might have lived perhaps all their lives in the province of Quebec and then in their declining years, moved to the province of Ontario. Probably under the regulations governing old age pensions they would be required to prove ten years' residence in Ontario before they would be eligible for pensions. In that case Ontario would be supporting them although they had lived fifty or sixty years in the neighbouring province. On the other hand, a couple might have lived in Ontario all their lives and then moved to one of the other provinces for, say, one year, afterwards returning to their original home, and this break might render them ineligible for pension benefits in Ontario. It seems to me therefore that it is impossible to secure a fair and equitable working out of such a scheme of co-operation between the federal government and the provinces.


Mr. W. G. RAYMOND (Brantford):: Mr. Speaker, in view of the amendment, may I say a word in defence of the report? I thought the correspondence between the premiers of the provinces and the committee which appears in our report would have been read by the members of t'he House, and therefore was a matter of general knowledge, but I was very glad; to hear the hon. member for West Calgary (Mr. Shaw) read that correspondence, and I think in it we find the reason for the report of the committee. That is to say, the provincial premiers pointed out that they want to look into this matter further,

Old Age Pensions
and tihe report of the committee, by suggesting a meeting with the premiers, gives them an opportunity for discussing the scheme fully.
Now, let me point out the position before the House in adopting either the report of the amendment. The report will carry on further the work that was taken up by the committee. The amendment will stop it by referring the matter back to the committee, whose functions end with this parliament, and therefore such action will absolutely squelch the scheme. We wish to see the work earned on and discussed in conference with the premiers of the provinces. If it is discussed, I am sure that an amicable arrangement can be come to. In the correspondence the premier of British Columbia says in his last tetter that he has seen a different light on the question to what he had when the resolution was moved in the legislature of his province, which resolution was forwarded to the committee by the lieutenant governor. The amendment to the report proposes the alternative of an annual expenditure of $23,000,000, not merely a vote of this sum, and the majority of the members of the committee did not feel prepared to take the responsibility of recommending such a large annual outlay.
Further, I may state that in the discussions of the committee there were those who wished that instead of $20 a month the amount should be $40. That would make the sum involved $46,000,000 instead of $22,000,000, and the age would be reduced according to the ideas of these members from 70 to 65 which would have added forty or fifty per cent further to the necessary annual expense to carry out such a scheme as seems to be their objective. It appears to me that it i3 what may be described as the " freedom of irresponsibility " that gives members the liberty to recommend such a large annual expenditure to this House, and I feel confident that such an act never would pass. But the scheme proposed by the committee is one which approaches nearer the end and object of the committee and which will carry out their purpose. I do not wish to go over the evidence that was presented to the committee, it is all in the report for the benefit of those that are interested. But I say, and I say it with the greatest respect that the hon. member for Mackenzie (Mr. Campbell) and the hon. member for West Calgary (Mr. Shaw) who have spoken on the subject, have shown by the remarks they have made that they have not read or considered the committee's report. I would therefore, Mr. Speaker, urge the House to adopt the report of the committee with a view to the furthering of this very desirable scheme of old age pensions.


Mr. J. S. WOODSWORTH (Centre Winnipeg) :: This question has been before the
House, according to the committee's own report of last year, since the year 1907. The adoption of the report simply means that action- will be deferred indefinitely. I would point out that the adoption of the amendment means that this question goes back immediately to the committee, and might be reported on to the House to-morrow. Information has been assembled by the committee during the past two years, the outlines of the scheme are already there; and the House can immediately set up a scheme either of carrying out old age pensions directly or of carrying them out in those provinces that were willing to co-operate according to the original scheme of the committee. So that there is really no reason why immediate action may not be taken.
By the report of the committee we are recommended to send the whole question to another conference. I would urge that these conferences, as we have had them year after year on different subjects, have proved themselves to be absolutely futile; it is simply another way of stalling the matter. We have already met with the provinces. What could we secure more than we did a year ago on the question of unemployment? We get these representatives together, they say what they want-it is what they have already said -a good deal of publicity is given to the matter, the government has made a show of doing something, and the question is stood over once more. We have had this exhibition again and again, it seems to be the favourite tactics of the government to work along these lines. Here we have only another example of it. Why should we not take action on this matter that has been before the country for nearly twenty years?


William Charles Good: What would happen if the
report were referred back and the committee did not report this session?


William Irvine: Why should they not report?


William Charles Good: They might not.


William Irvine: They ought to.


James Shaver Woodsworth: There -is quite a
possibility that they might not report and that only suggests to those interested throughout the country the extent of the sincerity and earnestness of the government in this matter. Proposals affecting the welfare of
Old Age Pensions

large numbers of our fellow citizens, can be shoved into the last dying moments of the session and then we are told we cannot do anything. A similar course has been followed before. This is but another illustration of the trouble that exists as between the Dominion and the provinces, and again the British North America Act is quoted. A year ago on the very last day of the session we had a similar situation with regard to the eight-hour day proposal. On that occasion the report of the committee was not even recommended to the House until it was forced by hon. gentlemen on this side. Then the final result of considerable investigation by the committee was a reference of the whole matter to the Supreme court for decision. Then in the argument in the Supreme court on that matter we had the very curious spectacle of at least one of the provinces pleading that the responsibility was altogether on the Dominion government with regard to the eight-hour day, and the Dominion government trying to shoulder it on the provinces. I take it that the original idea of the British North America Act was to safeguard the rights of the provinces, but that act is being used to evade responsibility, with the result that we get nowhere and in the meantime people suffer.


Alan Webster Neill: Does the hon. gentleman
seriously suggest that the Department of Justice is privy to a scheme to let the government evade responsibility?


James Shaver Woodsworth: My statement was
that the British North America Act would seem to have been designed to protect the rights of the provinces and yet that act is being used-


Alan Webster Neill: By whom?


James Shaver Woodsworth: -is being used to enable either the provincial or the federal government to evade responsibility.
Mr. IRVINI?:	May I ask the hon. memcer, does he think that in the event of this amendment not being carried and little coming out of the conference next year, it would be wise for the government to refer it to the League of Nations?


James Shaver Woodsworth: The League of Nations? I do not know why that should be injected, except this: The social rights of the workers of this country are practically guaranteed by the League of Nations, and the Dominion government was a signatory to the peace treaty of Versailles. The Dominion government had its representatives at Washington where the conventions were ratified. Yet not-
withstanding the reaffirmation of the conventions dealing with a number of questions like this, we have inactivity throughout all these years. I do not want to delay the House this morning to discuss the necessity of legislation of this character, but I should like to point out what is involved in the scheme as brought forward a year ago. The recommendation then was:
That an old atxe pension system be established at the earliest possible date for deserving indigent persons of seventy years of age and upwards.
That applicants for pensions must be British subjects of at least twenty years' residence in Canada or naturalized subjects of at least fifteen years' naturalization and twenty-five years' residence.
That the maximum rate of pension be twenty dollars per month, which would be lessened by private income or partial ability to earn.
Let me say that there are few civilized countries in the world to-day that have not legislation of this character. Australia, we are told, has legislation. May I suggest that Australia is getting immigrants. We appeal for immigrants, and we make very little provision for our own citizens or for those who may come to us. Is it an extreme demand that we should take care of indigent persons of seventy years of age? Why, we do not even propose that. We limit that by saying "deserving" indigent persons of seventy years of age. Surely if men or women have worked in this country for the upbuilding of Canada, it ought to be possible that the Canadian people are strong enough and wealthy enough to take care of them after they are seventy years of age. Is that too much to ask? But we do not ask even that. We say that it is only British subjects that are to be taken care of, or subjects who have been naturalized within the last fifteen years and have had twenty-five years residence in this country. We limit the scope of the provisions very narrowly. Further than that, we do not propose to take good care of our aged; we are going to give them only $20 a month with deductions if they have other resources. We find ourselves, in this Canada of ours with all its boasted wealth, incapable, apparently, of taking care of this comparatively small group of persons.
I notice that we have in the supplementary estimates a vote of a very considerable sum of money as a pension for one of the outstanding members of this House. Some of us hardly know how to vote on a matter of that character. We quite agree that there has been service rendered; we quite agree that there has been eminent service rendered; we quite agree that the gentleman concerned has not attempted to graft out of the country. But why should one Canadian be picked

Old Age Pensions
out and given an annuity of $10,000 a year when other Canadians, who according to their ability and station in life, have served just as faithfully, should be denied $20 a month?
I say it is not fair, and as representing one group of those who are called the common people of this country, I want to protest against the apathy and inaction of parliament in dealing with this important matter.


Mr. SPENCE:: * As one member of the Old Age Pension committee, I may say that we have given this matter a great deal of consideration, and I hope that at this late hour of the session we shall not take up too much time discussing it. The hon. member for Brantford (Mr. Raymond) has given the House the effect of the recommendations of the committee, and may I say that the recommendations we have made will get somewhere? But the amendment moved by the hon. member for East Calgary (Mr. Irvine), and supported by the hon. member for Centre Winnipeg (Mr. Woodsworth), is simply playing to the gallery. We had no intention of stalling this old age pension question; that was not our desire at all. We have made a recommendation, not to the effect that a special conference should be called, but I understand that a conference is going to be held this fall of the premiers of this Dominion, and at this conference this matter can be taken up. We cannot hope to go into this scheme at all.


William Irvine: Why not?


David Spence: The cost is entirely too high. At the present time this country cannot bear it.


William Irvine: Then why not have the
courage to say so, to tell the people the truth?


David Spence: We are.


William Irvine: You are not.


David Spence: We feel that the administration by the provinces would be much cheaper. The overhead would not be so large. We have given this mat-
12 noon, ter all the consideration that is necessary, and I hope the House will pay absolutely no attention to the amendment that has been moved to the committee's recommendations.


Mr. SUTHERLAND:: The Votes and Proceedings of yesterday, I notice, contains a copy of the committee's report, and in looking ever it I see that the advice of the Deputy Minister of Justice was asked for by the committee in regard to this matter. My reading
of the report of the Deputy Minister of Justice is that this is entirely a provincial matter, unless it is on a voluntary basis which does not affect property rights. The report of the committee would indicate that they are taking action in this matter, whereas, according to the opinion of the Deputy Minister of Justice, this is purely a provincial matter and should be left to the provinces to deal with, if dealt with at all. I think it is absolutely a waste of time to discuss this matter at this stage, or at any other stage.
The House divided on the amendment (Mr. Irvine), which was negatived on the following
division:
YEAS	*
Messrs.
Bancroft,	Good,
Bird,	Irvine,
Black (Yukon),	Kellner,
Campbell,	Kennedy (Edmonton),
Church,	Leader,
Coote,	Shaw,
Davis,	Ward,
Gardiner, Garland (Bow River),	Woodsworth-17.
 NAYS Messrs.
Anderson,	Forrester,
Archambault,	Fournier,
Baldwin,	Gendron,
Beaubien,	Gordon,
Beland,	Gould,
Benoit,	Graham,
Binette,	Hammell,
Black (Huron),	Hanna,
Bouchard,	Hanson,
Bourassa,	Harris,
Bowen,	Healy,
Boys,	Hoey,
Brethen,	Hopkins,
Bristol,	Hubbs,
Brown,	Hudson,
Caldwell,	Hushes,
Cardin,	Humphrey,
Carmichael,	Hushion,
Casgrain,	Jacobs,
Charters,	Johnston,
Chevrier,	Jones,
Chew,	Kay,
Chisholm,	Kennedy (Port Arthur &
Clark, [DOT]	Kenora),
Clifford,	King (Huron),
Copp,	King (Kootenay),
Crerar,	King, Mackenzie (York)
Dechene,	Knox,
Delisle,	Lanctot,
Denis (Joliette),	Lapierre, .
Denis (St. Denis),	Lapointe,
Desaulniers,	Lavigueur,
Descoteaux,	Lewis,
Desrochers,	Logan,
Dickie,	Lovie,
Duncan,	Low,
Euler,	Macdonald (Pictou),
Evans,	MacLaren,
Fafard,	MacLean (Prince, P.E.I )
Fansher,	Maclean (York),
Findlay,	McBride,
Forke,	McConica,
Old Age Pensions

McCrea,	Roberge,
Mclsaac,	Robichaud,
McKay,	Robinson,
Me Kill op,	Robitaille,
McMaster,	Ross (Simcoe),
McTaggart,	St. Pere,
Malcolm,	Sales,
Manion,	Savard,
Marier,	Seguin,
Mewbum,	Sexsmith, *
Michaud,	Sheard,
Millar,	Sinclair (Oxford),
Milne,	Sinclair (Queens, P.E.I.),
Morin,	Spence,
Morrison,	Stansell,
Motherwell,	Steedsman,
Munro,	Stewart (Argenteuil),
Neill,	Stewart (Hamilton),
Papineau,	Stewart (Humboldt),
Pouliot,	Stewart (Leeds),
Power,	Stirling,
Preston,	Sutherland,
Pritchard,	Tobin,
Rankin,	Tolmie,
Raymond,	Vien,
Reed,	Walsh,
Rinfret,	Wilson,
Robb,	Woods-139.


Mr. HUGHES:: I was paired with the hon. member for Battle River (Mr. Spencer). When going to Montreal he asked me to consult the Whip of the 'party.


Some hon. MEMBERS:: Order, order.


James Joseph Hughes: I am asking permission to make an explanation. I instructed the whip that I was paired with the hon. member and the whip said he did not know how the hon. member would vote on the motion if he were here. Therefore, I voted against the amendment.
Main motion (Mr. Raymond) agreed to.



PRIVATE BILLS FIRST AND SECOND READINGS

[Stage Direction]
Bill No. 214, from the Senate, the relief of Ella May Stacey.-Mr. Jacobs.
Bill No. 215, from the Senate, the relief of Jessie Harriett MacKay.-Mr. Boys.
Bill No. 216, from the Senate, the relief of Edna Fox.-Sir Henry Drayton.
Bill No. 217, from the Senate, the relief of James Jackson.-Mr. Church.
Bill No. 218, from the Senate, the relief of William Frederick Hamilton Strangway.- Mr. Duff.

Mr. E. N. HOPKINS (Moose Jaw) moved:: That in accordance with the recommendation contained in the fifth report of the select standing committee on Railways, Canals and Telegraph Lines, the additional charge of $200 levied and paid, under rule 89 subsections 3 (c) and 8, on Bill No. 187, respecting the Canadian Pacific Railway Company, be refunded.
[Mr. Sutherland 1


Joseph Tweed Shaw: Does the Acting Minister of Finance (Mr. Robb) approve this action?


Mr. ROBB:: No.


Some hon, MEMBERS:: Explain.


Mr. E. J. GARLAND (Bow River):: I admit complete ignorance of this matter, and I Should like to ask an explanation from the mover. I do not see why we are asked to refund this $200 for the Canadian Pacific Railway Company, of all companies in Canada.


Mr. SPEAKER:: I may say that the motion reads that it is in conformity with the recommendation of the select standing committee on Railways, Canals and Telegraph Lines.


Mr. A. J. LEWIS (Swift Current):: I was in the committee. The matter was fully discussed by the committee and it was recommended. Of course the motion is in conformity with the recommendation of the eom-mittee.
Motion agreed to on division.



BUSINESS OF THE HOUSE


Right Hon. W. L. MACKENZIE KING (Prime Minister):: There are one or two motions which I wish to make, but I did not care to make them when the leader of the opposition (Mr. Meighen) was not in the House. I move:
That as in accordance with the resolution adopted on the 16th instant, the House will be meeting at eleven o'clock for the remainder of the session, the standing committees of the House be given leave to sit while the House is in session.


[Stage Direction]
Motion agreed to.

William Lyon Mackenzie King: That on Saturday, the 20th June instant, the House shall meet at eleven o'clock in the morning, and that, in addition to the usual intermission at six o'clock p.m., there shall be also an intermission from one to three o'clock p.m., and that the order of business and proc dure on that day shall be the same as on Fridays.
May I say in connection with this motion that, while the government would like the House to sit on Saturday morning and afternoon, it is not the intention to sit on Saturday evening.


[Stage Direction]
Motion agreed to.

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

Questions

Mr. BLACK (Yukon):: 1.	Having reference to the old post office site, comer Pender and Granville streets, Vancouver, British Columbia, (a) has the government advertised this property for sale; (b) when were bids due; (c) how many offers were' received and from whom; (d) what was the highest tender, if any?
2.	Before advertising the said property, did the government secure estimate of value by individual appraisal ; if so, by whom was the property valued and what was the amount of the said appraisal?
3.	Has the government secured information of the value of property similarly located which has been sold?
4.	Is the government aware that there has been considerable movement of property in Vancouver in this neighbourhood, with the prospect of steadily increasing values in the near future?


Hon. Mr. KING (Kootenay):: 1.	(a) Yes.
(b) April 30, 1925.
(e) and (d) Richards, Ackroyd and Gall- $300,000 subject to purchase of Winch building, for $700,000. The British Columbia Estates Ltd., $247,000.
2.	Resident architect estimated site $200,000, building $60,000, total $260,000. Assistant resident architect stated from the assessment it would appear the old post office site would be worth from $340,000 to $360,000. In November, 1924, II. V. Sharpies considered value of property to be $300,000.
3.	Yes. Property adjoining old post office on Granville Street, lot 45 x 130, sold to A. J. Buttimer for $165,000. Property southwest corner Granville and Dunsuir, lot 50 x 120, sold to Quagliotti for $215,000.
4.	No; with the exception of the two properties mentioned in No. 3.


EDMONTON-SOLDIER SETTLEMENT
Mr. KELLNER:: 1.	Did the government recently rent additional office space for the Soldier Settlement Board in Edmonton, Alberta ?
2.	If so, are there any other governmental offices housed in the same building?
3.	How much rent is the government paying for this building?
4.	What is the term of the lease?
5.	Who is the owner of the building?


Hon. Mr. KING (Kootenay):: 1.	No additional office space is being rented but it is proposed to transfer the Soldier Settlement board from the Williamson block to the Blowey-Henry building.
2.	Yes. The Customs examining warehouse and the Dominion Lands branch of the Department of the Interior. It is proposed also to house in this building the superintendent of western land agencies, income tax, fisheries
office, food inspector, medical health office and forestry branch.
3.	The amount of rent paid prior to above transfer, $13,775. Proposed amount to be paid for additional space, $7,150.
4.	New lease to be effective from the date occupied and to terminate concurrently with existing lease namely August 1, 1929.
5.	Blowey-Henry Company.


PRISON REFORM
Mr. CHURCH:: 1.	Is it the intention of the government to so readjust and add to the number of trades or industrial output of penal institutions so that all inmates may find work and thus enable the families, wives, children and dependents of inmates to receive pay? If not, why?
2.	Will anything be done this session, or an opportunity given of continuing the adjourned debate on this question before the House prorogues?


Hon. Mr. LAPOINTE:: 1 and 2. Under
consideration.


ST. JOHN, N.B., TRIPARTITE AGREEMENT
Mr. MacLAREN:: Is it the intention of the government to carry out the Tripartite agreement (so called) made between the Dominion of Canada, the Canadian Pacific Railway and the City of Saint John, New Brunswick, for the purpose of developing terminal transportation facilities on the west side of the harbour?


Hon. Mr. KING (Kootenay):: Yes.


IMMIGRATION DISBURSEMENTS
Mr. DOUCET:: What was the total disbursement of the Department of Immigration and Colonization for the years 19211922, 1922-1923, 1923-1924, 1924-1925?


James Alexander Robb: 1921-	22	$2,213,327	931922-	23	
2,354,975	341923-	24	
3,482,986	901924-	25	
3,160,525	04
The total for 1923-24 includes the sum of
$649,881.97, spent on account of the British Empire Exhibition, while the total for 1924-25 includes $599,796.86 spent on the same account.
IMMIGRATION STATISTICS Mr. DOUCET:
What was the total number of immigrants admitted into Canada during the years 1921-1922, 1922-23, 19231924, 1924-1925?


James Alexander Robb: 1921-	22	
89,9991922-	23	
72,8871923-	24	
148,5601924-	25	
111,362
Senate Reform.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. CHURCH:: 1.	How many returned soldiers of the great war are detained in the penitentiaries of Canada, and where?
2.	What inspection is there of these institutions, by whom, when, and are government officials the only
inspectors ?
3 Is it the intention of the government to introduce legislation this session to empower grand juries, sitting at the assises or general sessions of the peace holden in the municipality where these institutions are or the nearest municipality, regularly to visit and inspect these institutions, similar to the law of England and all the oversea Dominions (Canada excepted) and in the same way that juries now visit provincial prisons ?
4. If not, why not?


JUVENILES IN PENITENTIARIES
Mr. CHURCH:: 1.	How many juveniles under IS are now detained in the penitentiaries of Canada, where, and how many are 16 or under, 17, 18 and 19 years of age?
2.	Is it the intention of the Government to give effect to the recommendations for years of grand juries and public bodies to provide separate institutions for these cases? If not, why?
3.	Is it the intention of the Government to so readjust the rules of these institutions so that juveniles and first offenders will have preferential rules and also a better classification consideration to those of repeaters ?
4.	Is it the intention of the Government in the recess of Parliament to appoint a Royal Commission or Committee of the House to go into the whole question of prison reform in Canada as suggested in the debates in Hansard, 1922? If not, why not?



SENATE REFORM

[Stage Direction]
On the Orders of the Day:
Rifrht Hon. ARTHUR MEIGHEN (Leader of the Opposition):: The government opened parliament with a promise that they would get authority from parliament to call a provincial conference with a view to securing the agreement of the provinces to amend the British North America Act so as to curtail the powers of the Senate. We are now approaching the end of the session, and we are reminded of the anniversary of the same threat of a year ago. I think we should not close this session until we know about what time this conference is going to be called and what proposals the government intends to submit to it.


William Lyon Mackenzie King: With respect to the proposals, I might say the government has not as yet had time to consider the agenda, but any conclusions the conference may come to will be presented to parliament for discussion when parliament reassembles.
[Mr. Robb.l
The government will commit parliament to nothing. As my right bon. friend knows, during the session the government's time is very much occupied with the business that is transpiring from day to day and a conference of this character will require careful consideration before being entered upon. I am not at the moment in a position to say what the agenda will be. The government will seek to bring before the conference the representations that have been made from different quarters with respect to changes that are believed to be in the public interest and which should be discussed. The conference will not be confined to matters relating to the Senate but will take up possibly such a question as the one discussed this morning with reference to old age pensions, and other matters which it may be deemed advisable to confer upon with the provinces generally.


Mr. MACLEAN (York):: And the right to amend our own constitution, as proposed by myself.


John Warwick King: That is another matter that might well be considered. The interjection of the hon. member for South York is sufficient to indicate that the government would wish to prepare its agenda with care before announcing it to the public. As to the date of the conference, we would wish to be guided by what appeared to suit the convenience not only of our government but of the provincial governments as well. Beyond stating that an announcement will be made in plenty of time to enable all parties who wish to be represented to be here, I cannot assign any definite date.


Arthur Meighen: Does the Prime Minister mean to imply that the proposal on which he was very definite a year ago is now in an indefinite form, or that the government will submit that proposal with its approval to the conference?


John Warwick King: I have already intimated that the government will endeavour to bring together the various proposals that have been discussed and have been receiving consideration throughout the country, and will present them to the conference. As to just how the government will present matters to the conference, whether it will be in the form of recommendations from the government itself, or whether the conference will proceed by way of general discussion with a view to arriving at certain propositions, is a matter still to be considered.


Arthur Meighen: For my part, I now bid good-bye to all prospects.

Yukon Officials-Tax Exemption



WAR IMPRISONMENT OF DR. BELAND

[Stage Direction]
On the Orders of the Day:
Mr. H. A. STEWART (Leeds):: May I ask when we may expect the return, which was ordered on May 25, of correspondence relating to the imprisonment of one Dr. Beland during the war? Will that correspondence be brought down before the end of the session?


William Lyon Mackenzie King: There have been some communications with the home government with reference to the correspondence in question but I am unable to say at the moment whether final reply has been received as to its willingness to have the correspondence submitted. However, I will inquire into the matter.



OLD AGE PENSIONS

[Stage Direction]
On the Orders of the Day:
Thomas Langton Church: In view of the fact that there is some question of jurisdiction involved as between the federal and the provincial authorities, would the government undertake during the recess of parliament to submit a stated case for the opinion of the Supreme Court of Canada on the question of old age pensions?


William Lyon Mackenzie King: I should have to confer with the Minister of Justice on that ques-* tion.



EXPORT OF POWER

[Stage Direction]
On the Orders of the Day:
.Sir HENRY DRAYTON (West York): May I ask the Minister of Trade and Commerce (Mr. Low) again whether that order in council lias yet been passed for the relief of certain municipalities from the export tax on electricity? Will he undertake to table the order in council before the close of the session?
Hon. T. A. LOW (Minister of Trade and Commerce):: I have nothing to add to my answer of yesterday.


Sir HENRY DRAYTON:: It was no
answer.



TRANSFER OF NATURAL RESOURCES OF THE PROVINCES

[Stage Direction]
On the Orders of the Day:
Mr. J. A. CLARK (Burrard):: Is the Minister of the Interior (Mr. Stewart, Argenteuil) in a position to-day to state when the return will be made to the question I put on February 23 last* and to which I referred yesterday, on the question of the natural resources of the provinces?


Hon. CHARLES STEWART (Argenteuil. Minister of the Interior):: I must confess to neglect in this matter. I promised the hon. member yesterday that I would bring it to the attention of the officials and I completely forgot. However, I will make a note of it now and see that the return is made to-morrow.


Arthur Meighen: There are a great many
other orders outstanding, and I may warn the government that they will be recited to-morrow. I hope some of them will be brought down.



YUKON GOVERNMENT OFFICIALS- INCOME TAX EXEMPTION

[Stage Direction]
On the Orders of the Day:
Mr. GEORGE BLACK (Yukon):: On
March 9 last an order was passed for the return of correspondence and documents relating to exemption or partial exemption from payment of income tax by Yukon officials. The resolution was moved by myself and I waited until May 19, when I ventured to inquire whether the return would be brought down. On that occasion the Acting Minister of Finance (Mr. Robb) promised to look into the matter, and the next day, without any intervention on my part, he said:
The secrttary of the department has communicated with Mr. Breadner, who expects to have the return ready early next week, if not sooner. It may be ready to-morrow.
Again, on May 27, I asked whether the return might not be brought down and I was assured that it would be down in a few days. On June 5 the Prime Minister was kind enough to say that he would call the matter to the attention of the minister and request that it be attended to. Now, I happen to know that the information has been prepared, and I cannot understand why the formality of presenting it to the House has been so long delayed. I hope the return will be brought down.


Hon. P. J. A. CARDIN (Minister of Marine and Fisheries):: The documents are ready to
be forwarded to the Secretary of State's department for the preparation of the return.



BY-PRODUCT COKE OVENS

[Stage Direction]
On the Orders of the Day:
Mr. JOS. T. SHAW (West Calgary):	Will
the Minister of Mines be good enough to inform the House when he intends to move the resolution now on the order paper with respect to by-product coke ovens?
Railway Freight Rates
Charles A. Stewart: As soon as the freight
rates question is out of the way we shall be ready to discuss the matter.



RAILWAY FREIGHT RATES


[Stage Direction]
The House resumed, from June 17, consideration in committee of Bill No. 181, to amend the Railway Act, 1919-Hon. Mr. Graham- Mr. Gordon in the chair.
On section 3

Power to fix rates and enforce fair and reasonable rate structure.
John Warwick King: The criticism that has been directed by hon. gentlemen opposite against the government with respect to the legislation before the House has come from diametrically opposite and antagonistic points of view. Gentlemen immediately opposite have criticized the government on the ground that in the effort to have a policy of equalization of freight rates adopted throughout the country we have not done away entirely with any security to the middle west with respect to the maximum rates on grain and flour, which were a part of the security afforded by the Crowsnest pass agreement. On the other hand, gentlemen of the Progressive party further to the right have criticized the government, not because we have not done away with this measure of security, but for the reason that we have not restored the Crowsnest pass agreement in its entirety

and, if I gather correctly, not only the Crowsnest pass agreement as interpreted in its application by the courts, but the Crowsnest pass agreement in its application, as assumed before judicial decision had been given by the Supreme court.
I may point out that this again amounts to criticism of the administration for not going in opposite directions at the same time. It is not dissimilar to the criticism that was made at the time tariff matters were under discussion, when hon. gentlemen immediately opposite criticized us because we had not raised' the tariff higher, and the members of the Progressive party criticized us because our tariff proposals were not lower. The nature of the criticism coming from the other side of the House simply helps to emphasize the very difficult position of any government which attempts to deal with a problem that affects all parts of Canada, and to deal with it in a manner calculated to bring in effect the application of one great governing principle that will be just and equitable to all parts concerned.

As to retaining the rates on grain and flour, the government has felt that it is dealing with a condition, not with a theory. Theoretically, I do not believe it can be disputed that the only basis on which freight rates can properly be fixed is that of allowing to the railway commission an absolutely free hand. That is unquestionably the sound, theoretical position. On the other hand, in the endeavour to make effective that policy the government, as I have said, is confronted with an existing condition-that at the present time and for many years past the middle west has had a certain degree of protection in its maximum rates guaranteed by the Crowsnest pass agreement under an act of parliament passed many years ago. That agreement still continues and is now in force as interpreted by the Supreme court in its Tecent decision. In the present form it is satisfactory to no one. The government has had to consider the circumstances under which that agreement came into being, the position of western Canada today as contrasted with the time when the agreement was entered into, and also what would be the effect at this moment, having regard to the sentiment of the middle west and to other considerations, of the complete removal of any security to the middle west respecting maximum rates on the important commodities of grain and flour. When the agreement was entered into twenty-seven years ago the western provinces were virtually unsettled-as a matter of fact all three had not been created at the time-the government of the day was striving to induce immigrants to colonize and settle there. Moreover, there was at the time but one railway company operating throughout western Canada, a railroad monopoly, and there was no prospect of competing lines being constructed within the near future. There was also at that time no rate-regulating body such as later was appointed by parliament- the Board of Railway Commissioners.
Now, the change that has come about since that time must be apparent to all. A very considerable development has taken place in the middle west, provincial governments have come into being helping to safeguard the interests of their provinces. There have been constructed two competing railway systems, now merged into one and forming part of our great Canadian National Railway System. This of itself has raised a question which was not then present-this great nationally owned railway system has to be considered. And here again we are confronted not with a theory but with a condition, that

Railway Freight Rates
whatever is done in the way of fixation of rates as respects one line to which this agreement may apply, must also be done to apply equally, through the forces of competition, to a competing system-a system which is occasioning all parts of Canada financial embarrassment of a very considerable magnitude. I hope, therefore, our friends from western Canada will appreciate the change which has taken place in the situation since the Crowsnest pass agreement was entered into, and discern wherein the government in the course it has taken has sought to go just as far as circumstances will permit in enabling the larger policy of equalization of freight rates to be worked out in a manner which will help to maintain and further to the fullest possible extent a sentiment of mutual interest and national unity throughout the Dominion.
I have been 'looking over some of the speeches which I made in western Canada last fall, and which were quoted, in part I think, by the bon. leader of the Progressive party (Mr. Forke) in his remarks the other evening. I notice in speaking on the prairies I intimated very clearly that my view was that the railway commission was the right body to fix freight rates and should be given a free hand in the matter, but that I felt it should expect to receive directions from the government on matters of national policy. When speaking in Vancouver and Victoria I made similar statements, and I added that one of the great national considerations of which account should be taken by the railway commission was the position of the three prairie provinces in particular with respect to the two commodities upon the production and export of which the prosperity of this country largely depends, and that some consideration also should be given to the circumstance that other parts of Canada were to a very large extent protected with regard to maximum rates through water competition, a protection which the middle west did not have, and that it was only the part of national wisdom and justice that this particular factor should be taken into account. The position I took on the prairies and in British Columbia was an identical one and is exactly the position which the government is taking in this legislation, namely, to endeavour to bring about a policy of equalization of freight rates between all parts of the Dominion, and an doing so to rSoognize with respect to the middle west the existence past and present of the application of the Crowsnest pass agreement, and that evolution rather than revolution is the proper method of procedure in every effort to further
national unity by the application of a general principle; that this course demands that some special consideration be given the west at the moment without thereby working injury to the other parts of the Dominion.
In regard to allowing the maximum rates on grain and flour to remain, I would point out to my friends from British Columbia that the government is not adding restrictions to the railway commission but is rather subtracting from the limitations which the Crowsnest pass agreement had imposed in the protection afforded the middle west. In other words, it is allowing part of that agreement to remain, but it is taking away part. To that extent some sacrifice is being required of the middle west, but inasmuch as the railway commission is not given a free hand to equalize rates all over Canada regardless of the maximum rates that are being fixed for the middle west, to that extent also some sacrifice is being required of other parts of Canada. I ask, is it possible to gain support for any policy which demands a sacrifice only at one point and not at other points?
In the interests of national unity, in the desire to bring about a policy of equalization of rates, the government realizes that some sacrifice must perchance be temporarily borne by each of the provinces. We have sought to make that sacrifice as equal as we can as respects all parts of the country.
Now while we are taking away a part of the Crowsnest pass agreement under this arrangement, the government is extending the security with respect to flour and grain to an area much beyond that which was fixed in the original agreement. The mileage of the railways over which the arrangement will apply to-day is considerably greater than the mileage secured by the original agreement. Moreover it extends not to one railway only but to all railways in existence, and it extends also to all the railways that may be constructed during the time that this application may remain as it is. So I say to gentlemen from the middle west-


Mr. CRERAR:: I am very interested in the statement the Prime Minister has just made because I think there are a good many people who have a doubt as to the effect of the legislation. Now, do I understand from the Prime Minister that the intention of the government is that the grain and flour rates under the Crowsnest pass scale shall apply to all sections of western Canada that ship their grain eastward?


Mr. GRAHAM:: Without doubt.
Railway Freight Rates


John Warwick King: Without doubt; I think I may re-echo what the Minister of Railways (Mr. Graham) says.


Thomas Alexander Crerar: Then I shall have an Observation or two to make on the amendment which the minister moved last night.


George Perry Graham: I may get in ahead of my hon. friend and make a statement.


John Warwick King: May I supplement what I have said with special reference to hon. gentlemen from the middle West by a "word more particularly to the members from the province of British Columbia. The right hon. leader of the opposition in his remarks last night made the somewhat surprising statement that the order-in-council was so much "eye-wash" or "foam"-I think he used both expressions.


Arthur Meighen: Hear, hear.


John Warwick King: At any rate my right hon. friend now says " hear, hear." I suppose the right hon. gentleman means to suggest that it should be regarded as "a scrap of paper." Well, if that is the view of my right hon. friend, it is not the view of this government; and1 I wTould say to the House and the country that if this government remains in office it will not take the view of the order-in-council which my right hon. friend takes, but will regard that order-incouncil as a direction to the railway commission as to how it expects this policy to be worked out, and will see that the policy is worked out in accordance with the terms of the order-in-council. The order-in-council sets out the government policy. It is a direction to the railway commission to equalize rates. That direction indicates how this government expects this policy of equalization to be worked out. And I would remind hon. members that there remains, as the commission itself well knows, an appeal from the commission to the govemor-in-council with respect to matters of railway rates. This government has stated what its policy is with respect to the equalization of rates, and unless that policy is carried out in accordance with its intention-if this -government is in office when the question comes up-and I have not the least doubt it will be-it will take care to see that the policy is carried out in the spirit and intent of the letter as expressed in the order-in-council itself.


Mr. LADNER:: May I ask the Prime Minister, as I asked the Minister of Railways, this question:	If the government's intention
is so strong with regard to western freight

rates why did it not give the same privileges and rates on grain going westward to Vancouver to the markets of the world as it gives to grain going eastward to the markets of the world? Why did the government fix definitely the rates on these products going eastward and refuse to fix them so far as grain and flour going west are concerned?


John Warwick King: I think the Minister of Railways has already made that point clear, and I will repeat what he said: The government had to consider, in presenting its policy to the railway commission and to parliament; whether it would do so with reference to legislation that is already on the statutes or whether it would seek to create by fresh enactment new agreements or undertakings thereby making an innovation in one direction which would create a demand for like innovations in other directions. We concluded that the proper method to proceed was to recognize the legislation that is on the statutes at the present time, and leave as much of it as would serve to meet the purpose which the government had in view with respect to fixing maximum rates on grain and flour, and expect the railway commission in developing the policy of equalization of rates, to follow a course which would be in accord with the direction given both by statute and by order in council.


Arthur Meighen: Why did the government extend the statutory rates and multiply them three times? The statement has been made, and correctly made, that whereas previously they applied to 35 per cent of what they do now, they now apply to all-that is to say the statutory rates to the Crowsnest pass and the west are now made three times as great. What my hon. friend wants to know is when that was done why did not the government go further and extend the rates to the coast?


John Warwick King: In answer to
the first question asked, the practice has been just what the government is at present indicating. There has been no departure in that regard. *


Arthur Meighen: The Prime Minister is quite wrong. I have shipped grain myself, and I know it has not been the practice.


George Perry Graham: Shipped grain west?


Arthur Meighen: No, east.


John Warwick King: I should like
to read to the House a carefully prepared statement which I have made in reply to different gentlemen from western Canada who have asked what exactly was the government's

Railway Freight Rates
view with respect to the rates on grain and flour going west, and the effect of the legislation we are introducing in, relation thereto. I imagine that no one in British Columbia, has paid more attention to the freight rates question than the Hon. John Oliver, Premier of the province, and one of the first communications I had after the order in council had been published was from Mr. Oliver asking for a specific statement in view of certain representations that had been made in the press with regard to the government's policy. I drafted an answer, but before sending it I took care to submit it to my colleagues in council in order that no question might arise later over any difference of view as to the significance of what that reply contained; this is the substance of, in fact it is, the statement given to Premier Oliver, and the statement which I have given also to other gentlemen in western Canada:
"The statutory enactment regarding grain and flour must be read in light of general policy as set forth in order in council that equalization of freight rates should be recognized to the fullest possible extent as being the only means of dealing equitably with all parts of Canada, and also that the board be directed to make a thorough investigation of the rate structures of railways and railway companies with a view to the establishment of a fair and reasonable rate structure which will, under substantially similar circumstances and conditions, be equal in its application to all persons and localities, having due regard and in particular to the increased traffic westward and eastward through Pacific coast ports owing to the expansion of trade with the Orient and to the transportation of products through the Panama canal."
Later I sent another communication-


Leon Johnson Ladner: Would the Prime Minister give us the date of the communication he has just read?


John Warwick King: The date has no significance. I am not quoting the telegrams, I am quoting a statement which I made and which sets forth the government's position. I later after making mention of the circumstance that the government's interpretation of the effect of the order and proposed statute was as indicated in the statement I have just made, made the further statement that the right to appeal from the board's decision to the. Governor in Council being reserved should constitute a sufficient guarantee that the government's policy on equalization of freight rates will be carried out as intended.


Alan Webster Neill: Will the Prime Minister clear up a point that has worried some of the British Columbia representatives? We will suppose the decision of the railway board is not satisfactory to the government of British Columbia, and they take an appeal to the Governor in Council. Will the government's expressed determination, or practically so, to have an equalization of rates on wheat going both east and west not be prohibited by reason of the recent Supreme court decision which says that a specific statutory enactment of a rate prevents its being used as a basis for equalization, or reduction of another rate?


John Warwick King: The government's policy, as stated over and over again is a policy of equalization of rates. That does not necessarily mean, as I understand it, that as between provinces exactly the same rate per unit, per ton, per mile, shall prevail in regard to all commodities. Enough general knowledge exists of the difficulties of framing rate structures to have every hon. member realize clearly that matters of the kind are technical points that no assembly such as this could begin to pronounce upon. But there is an axiom of Euclid which says that things which are equal to the same thing are equal to one another, and my conception of the ' policy of equalization of rates is that the railway commission in dealing with a great problem such as this, would see to it, so far as British Columbia is concerned, so far as the prairie provinces and the maritime provinces and Ontario and Quebec are concerned, that a rate structure should be worked out which as respects the different provinces would help to make equal those things in their relation to each other, and help thereby to promote national unity and prosperity in trade and industry throughout Canada.
At one o'clock the committee took recess.
The committee resumed at three o'clock.


George Perry Graham: I am not sure whether the Prime Minister (Mr. Mackenzie King) had finished speaking or not, but while we are waiting I want to tell the House that we have been endeavouring to meet a suggestion which has been made that the wording of the amendment to section 5 might be made clearer. The amendment to section 5 which was proposed reads as follows:
-but shall apply to all the territory west of Fort William covered by tariffs filed with the board under the terms of said agreement at the date of the passing of this act and to all lin6s of railway now or hereafter constructed by any company subject to the jurisdiction of parliament within such territory.
Railway Freight Rates

I want to make it clear that the gentleman who advised me still insists that it is perfectly plain. But there has been a conference among several legal men, and they have evolved this amendment to make the situation clearer. The point raised was that in using the words "such territory" in the last line, reference could only be made to the territory west of Fort William covered by tariffs filed with the board under the terms of said agreement. As a matter of fact there is a great deal of mileage and different tariffs filed that in many cases were the same tariffs as those under the Crowsnest pass agreement, but they were not filed under that agreement because the lines were not under that agreement. It is a very technical point, but it is said it might raise a difficulty in the court. This is the section that has been agreed upon:
But such rates shall apply to all such traffic moving from all points on all lines of railway west of Fort William to Fort William or Port Arthur, over all lines of railway now or hereafter constructed by any company subject to the jurisdiction of parliament.
That new description I think is clearer. Then an amendment in subsection 6 would be necessary because the words "within the territory," would apply to the territory as described in the new amendment. Then another amendment is suggested to section 4, although my legal officers tell me it is not at all necessary. In order that there may be no question, it is suggested that in line 4, before the word "shall" the words "are and" shall be inserted, so that it will read1 "are and shall be deemed to be lawful tolls," and after the word "tolls" insert the words "until revised by tariffs filed with the board pursuant to this act." These words I am now suggesting make no difference in the principle of the amendment, but the legal gentlemen who have been conferring think that possibly it makes clearer what the intent was.


Leon Johnson Ladner: Do I understand the Prime Minister is not going to answer the question which I submitted to him before adjournment?


George Perry Graham: I am not saying anything
about that. He is not here. The question can be put again.


Thomas Alexander Crerar: Will the minister read the amendment again. It is rather difficult to see the picture clearly with the multiplicity of amendments we have had in this bill, and the conclusion that results from it. The amendment is not distributed and we have to depend simply on hearing it read by the minister. It is quite a vital section.


William Charles Good: Read it with the amendments put in.


George Perry Graham: After the figures "1897,"
in subsection 5 of section 3 this will be the amendment:
But such rates shall apply to all such traffic moving from all points on all lines of railway west of Fort William to Fort William or Port Arthur over all lines of railway now or hereafter constructed by any company subject to the jurisdiction of parliament.
Then in subsection 6 the amendment that I suggested last night, after the word "thereto," the words "within the territory" should still be inserted, because the territory to which reference is made is now described by the new amendment. Then in section 4, in the fourth line, before the word "shall" insert "are and" so that it will read:
Are and shall be deemed lawful tolls-
Then another addition-
Until revised by tariffs filed with the board pursuant to this act.


Thomas Alexander Crerar: That is really independent of the other amendment?
Mr.	GRAHAM:	Yes.


Thomas Alexander Crerar: We can discuss it when
we come to it.
Mr.	MANION:	Do	I	understand	that
both amendments combined cover all grain and flour going east from the three prairie provinces to the head of the lakes?
Mr.	GRAHAM:	Yes.Mr.	MacLAREN:	I	wish	to	refer	very
briefly to one or two points, as I think they should be mentioned to the House. The Minister of Railways in introducing the bill stated that, with the exception of the special provision regarding wheat and flour, the railway commission would have a free hand in working out a system of rates, with a view to obtaining equalization throughout the country. I do not refer to what the Prime Minister has stated that they have issued instructions to the railway commission regarding both the Maritime provinces and British Columbia, because I think those two statements are somewhat contradictory; but I refer to the statement of the Minister of Railways who says that the railway commission have a free hand with that exception. I take exception to that statement, because I shall mention two further exceptions to it. First, I would draw the attention of hon. members to the Railway Act of 1903, section 42, the Railway Act of 1911, section 13, and the Railway Act of 1914, section 6, paragraph (a). All three contain these words:

Railway Freight Rates
The through rate on export traffic from the point of origin to the point of destination shall not be greater via Canadian ports than it would be via United States ports
Therefore, I take the ground that, as regards through rates to Canadian ports, there is a restriction on the railway commission, and they are not at liberty to put a higher rate on through export traffic than obtains at a similar time through United States ports.
I submit with all due deference to the committee that that is a further limitation placed upon the railway commission in fixing rates. The second one is in reference to the Intercolonial railway. I think I am correct in stating that although the Intercolonial railway, so-called, is operated under the Canadian National railway system and under the same management, it is not, I maintain, a part of the Canadian National railway system. It was owned by the government. It is still owned by the government. It has never been transferred. Nothing less than an act of parliament will transfer the Intercolonial railway to the Canadian National railway system. That has not been done. What follows? While the railway commission may fix rates, they are all subject to protest, and, I believe, successful protest if necessary. I do not suggest for a moment that the Intercolonial railway cannot have full confidence in the railway commission, I am prepared to suggest that it can, but I wish at the same time to make what I may call my claim of right as regards these two points. I have brought this before the House and I bring it forward again in order to establish a position which, I think, is right.
I regret that I have not an opportunity of discussing the features of the bill itself. A great deal of time has been spent on it, and I will not encroach upon the time of the committee in this particular. I merely take this further opportunity of expressing my opposition to the bill. I do not think it is framed on principle. I do not think the procedure is logical. It fetters the hands of the railway commission. It will please no section of the country. I can come to only one conclusion, and that is that it has been framed on the ground of political expediency.


George Perry Graham: I want to answer the
charge of my hon. friend as to political expediency only by saying that he is altogether mistaken.


Murray MacLaren: Which point does the
minister refer to? I made three or four.


George Perry Graham: The last was not a point.
I did not refer to it as a point. It was pointless.


Murray MacLaren: It was a demonstration.


George Perry Graham: No, it was a filibuster for
political purposes and not for freight rates. As a matter of fact, the Board of Railway Commissioners have given the same rates to St. John and Halifax as to Portland. That covers the first point. The second point is as to the rates on the Intercolonial not being subject to the Board of Railway Commissioners. Months ago an order in council was passed placing the Intercolonial railway under the control of the Board of Railway Commissioners.


Murray MacLaren: The minister has not
met my points at all. I have been maintaining that the Intercolonial was not a part of the Canadian National. The minister agrees with me on that point.


George Perry Graham: I did not say so. Let me make it clearer if I can. It is immaterial to him whether the Intercolonial belongs to the Canadian National or not, so long as they get the rates.


Murray MacLaren: It is quite an important point.


George Perry Graham: It is not an important
point as regards rates. Months ago the Intercolonial was placed by order in council under the Board of Railway Commissioners for the control of rates. That was never done before. It was held in the hon. gentleman's province, and rightly held, and in Nova Scotia also, that although the Intercolonial had submitted to control of rates by the Board of Railway Commissioners, no authority had ever been given before by order in council to bring that about. But since that time an order in council has been passed placing the Intercolonial specifically under the Board of Railway Commissioners for the control of rates.


Murray MacLaren: I understand; this
really is a government by order in council.


George Perry Graham: Not at all. My hon.
friend seems to be objecting to the fact that the things he wants are being granted.


Murray MacLaren: I am sorry the minister
is annoyed again.


George Perry Graham: I am not annoyed at
all.


Murray MacLaren: My point was that the
Intercolonial was not an integral portion of the Canadian National.


George Perry Graham: That does not make much difference.

Railway Freight Rates

Mr. KENNEDY (Edmonton)The various amendments that have been made to this bill since it was first introduced go to show that it is a rather regrettable fact that it was brought down so late in the session. Possibly the budget debate might have been cut in two if we had had this bill before the budget was introduced, or even if the bill had been introduced while the budget debate was in progress.


George Perry Graham: The budget debate being
down, you might cut this in two.


Mr. KENNEDY (Edmonton):: I do not
think, however, in view of the fact that the bill has been amended two or three times since it was introduced, it is giving members the fairest opportunity to deal with the matter and to understand it. It is a very intricate affair and, therefore, I must say again it is regrettable that it was not dealt with earlier in the session. I have had some considerable difficulty in reconciling the order in council with the bill. I suppose the central theme of the order in council is the question of equalization. "Equalization" and "discrimination" are two words that are used to a great extent in connection with railway rate questions. Whether rates were referred to in the Speech from the Throne or elsewhere, during the last few months you find this word "equalization" but in this order in council there is a very severe qualification to equalization. The order reads:
To do away as far as possible with all unjust discriminations and undue preferences, and to secure a fair, and reasonable rate structure, which, undei substantially similar circumstances and conditions would be equal in its application to all persons and localities.
While the policy of the government may be equalization, with that qualification you can justify any kind of discrimination. The discrimination between east and west has been justified in days gone by through the use of the word "unjust"-there must be no "unjust" discrimination. I think it has been generally recognized that in the prairie provinces the cost of construction and operation has not been as high as in eastern Canada; and yet the water competition in the east has been a factor in preventing what we might call a general equalization of rates as between east and west. In British Columbia, again, we find a different situation. But though there has been a very severe discrimination there in some cases, if I -understand the matter at all, it would be possible to continue this discrimination under the clause that refers to circumstances being substantially similar. The order in council, after reciting the judgment 
of the Supreme court, goes on to say that the application of the Crowsnest rates again would disrupt the rate structure.
It seems to me that a serious side of the question has not yet been touched upon. There is no doubt as to what the understanding! df parliament was in regard to t(he application of tlje grain rates in 1922 and again in 1924 regarding the whole agreement. The opinion of parliament was not very well expressed in legislation, but surely the intention was that the rates should be applied generally. The years of practice of railway rate-making in western and eastern Canada ever since 1903 must show that this was the general opinion held by parliament and possibly by the railways themselves. In 1924 when the railways were asked by parliament to apply the Crowsnest rates again on other commodities, they established these discriminatory rates; and it appears to me that if they can do anything like that once without any question they can do it again. The purpose of the two railways in doing that was to create a difference between Calgary and Saskatoon, Brantford and Hamilton, Kitchener and some other point, and, to bring about the situation we have to-day; and I am afraid that the government is not very well advised in seeking to remedy the trouble in the way now proposed. There can be no question about the fact that the intention of parliament in days gone by was to apply the rates generally without discrimination, and if that was the intention of parliament we should not, because of the circumstances of the past few months and because the Supreme court has decided that the law on the matter is other than we thought it was, accept the new situation and change the legislation. We should not make such a change because of the discriminatory rates set up by the railways in the application of the agreement. I do not think that the Canadian National Railways have taken the step which is in the best interests of the system itself. One of the clauses in the order in council practically admits that the conditions which we have as a result of the application of the rates up to the present time cannot continue and that the Canadian National Railways would lie compelled to make similar reductions at competitive points. That apparently indicates that even in the mind of the government the discrimination so far as the railways are concerned was only temporary; and in view of that fact it would seem that, even though no legislation were passed at all affecting westbound commodities or the grain rates either, this condition should not be allowed to continue.

Railway Freight Rates
In my judgment this legislation is in some respects a step backward. Notwithstanding the admitted discrimination between east amd west in railway rates there has been a tendency over a period of years to bring them more closely together. In 1918 we had a fifteen per cent general increase in the month of March, and in August of that same year there was an increase of twenty-five per cent. That twenty-five per cent in eastern Canada was in addition to the fifteen per cent, while in western Canada the fifteen per cent was included in it. Apparently the board was anxious to put the eastern and western rates more on an equality. This does not mean, of course, that the rates are the same east and west; I am perfectly willing to admit that inasmuch as you have one sort of traffic in the west and another in the east the problem is rather difficult. Notwithstanding that fact, however, the railway commission by that decision did acknowledge that there was a discrimination and they tried to bring the two classes of rates nearer together. But in addition to that, in September, 1920, we had another decision of the railway commission. This is a very important decision on this question of discrimination as between east and west. The question is gone into at considerable length and we find the board declaring that, notwithstanding the difference in the application of the fifteen per cent and twenty-five per cent increases of 1918, there still is a considerable disparity between the rates in eastern and western Canada. They review the rates prevailing in the two territories on certain commodities mentioned, such as live stock, agricultural implements, lumber and so forth. I will not read the whole of it-any hon. member can see the judgment for himself-but I will quote from it briefly:
Allowing for the undoubted fact that a very large proportion of the traffic both east and west is on the commodity basis, I am still forced to the conclusion that the rates in western Canada average considerably greater than those in the east, possibly around 15 or 18 per cent. In coming to this conclusion I am stating nothing new, as this fact has always been recognized, particularly by Sir Henry Drayton, the then chief commissioner, in the eastern rates case, so-called, in re Eastern Tolls, 22 Canadian Railway Cases, at page 41, where the following statement appears:
"While as has been set out at greater length in the Western Rates Case, differences of conditions do exist between eastern and western Canada, and while western freight rates have already been materially reduced, the general schedule there obtaining is still higher, notwithstanding the fact that certain western rates that may be instanced are lower. There is no doubt but what the act requires, and the general public interest of the country as a whole demands, that, if practicable, eastern rates should be advanced so that
the different schedules may more nearly approach a parity."
This principle should be followed, giving weight to the conditions set out in re Western Tolls as affecting the regular level of tolls east and west of Fort William, and also bearing in mind changes in conditions which have taken place, I am of opinion that it is justifiable to allow a reasonably less percentage of increase on freight tolls west of Fort William than east thereof. Consequently, I have concluded that an increase in rates should be granted along the following lines, with the exception of the items hereinafter specially referred to. Until December 31, 1920, I would give a general increase of 40 per cent in eastern freight rates and 35 per cent in western freight rates, with 20 per cent both east and west in passenger fares.
Tuere was an increase of 35 per cent in the west, and. 40 per cent in the east, leaving still a difference, I suppose, after the application of these rates in September, 1920, of from, ten to thirteen per cent. The Board of Railway Commissioners there approved the general principle that eastern and western rates should be equalized as nearly as possible. In 1921 the government of the day had something to say about it also. An appeal was taken to the Governor in Council shortly after the promulgation of general order 308 of this board, which I have just read. Various bodies, among them the government of Manitoba, appealed to the Privy Council, asking that the order be rescinded for various reasons set forth by the appellants. The matter was heard by the Privy Council, and on October 6, 1920, under order P.C. 2434, His Excellency in Council dismissed the appeal, and in doing so stated as follows:
What constitutes a fair and reasonable rate should not be arrived at without reference to the requirements of the Canadian National system, and your committee recommends that the order in this case be referred back to the board to be corrected in its findings in such manner as to determine what are fair and reasonable rates without taking into account at all for the time the order shall be in effect the requirements of the Canadian National system.
Very strong representations were made in the course of the argument to the effect that the order continued, and indeed intensified an unjust discrimination in rates, it being claimed that higher freight rates prevailed generally in western Canada, that is west of Fort William, than prevailed in eastern Canada, that is east of Fort William. It was strongly urged that the reasons whatever they may have been, for this differential no longer exist, and that as a matter of public policy the principle of equalization of rates east and west should now be recognized. On the other hand, it was urged that the competition arising out of lake and river transportation as well as out of lower competitive rates on eastern United States lines, compelled the somewhat lower scale in eastern Canada than in western Canada. Whether or not these reasons now obtain in any substantial degree is a question which requires minute and expert investigation such as can best be conducted by the railway commission itself and not by Your Excellency's advisers. But your committee is strongly impressed with the very great desirability of bringing
Railway Freight Rates

about with the least possible delay equalization of eastern and western rates.
So we have the Board o-f Railway Commissioners, the government of 1920, and now this government, all saying in effect that we should have equalization of freight rates all over the country. But I am afraid this bill does not bring us any nearer equalization of our rate structure. It is true that we are going to get equalization in grain rates in a specified territory-under section six, if I understand it aright, it will not be possible for the Ca-na-adian National Railways to charge higher rates than the Canadian Pacific on grain and flour moving eastward, and it will not be possible for the Canadian Pacific to charge higher rates to one portion of the territory and lower rates to another portion where the conditions are much the same. But what . will it do with respect to the other commodities moving westward? Does it not mean that we will have the discrimination intensified there? Not between the different parts of the prairie provinces, but between the east and the west? The minute this bill is passed, if I understand the situation, the Crowsnest pass rates on the commodities enumerated in that agreement will go up to where the other rates are,' so that in general the rates which the westerner will have to pay on manufactured products from the east will be higher than even the average of all the rates to-day.


George Perry Graham: The bill gives the Board
of Railway Commissioners full power to say what the rates shall be.


Edward Joseph Garland: But did not the minister intimate that increases would be necessary as a result of the condition of the railway companies?


George Perry Graham: I do not think we ought
to interfere.


Donald MacBeth Kennedy: That may
be all very well after the Board of Railway Commissioners have completed their investigation, but the imediate effect will be that the rates will go up to the level of the rates quoted by the minister the other day as between the Crowsnest pass agreement points and the other points in eastern and western Canada.
As to British Columbia, I understand the bill means this: while there can be no discrimination on their rates going eastward, they will have no right under this legislation to argue against discrimination that may exist on westbound shipments as opposed to eastbound. That is what I understand to be (Mr. D. M. Kennedy.]
the meaning of section six. Possibly we shall hear more about it in detail when the Minister of Railways addresses the House again, and if I am wrong in my understanding I hope he will put me right.
:Now, -throughout this argument, and especially throughout the -country during the last year or two, a very strong effort has been made to convince the people, both east and west, that under the Crowsnest pass rates some special favours are being handed to western Canada. The hon. member for North Waterloo (Mr. Euler) told us last night that he had a record of some rates that would show that the rates were higher in eastern Canada than they were in the west. But that is not generally the case. The Minister of Railways (Mr. Graham) filed a statement here showing the difference between the rates from Hamilton to Saskatoon, from Woodstock to Regina, and so on. Buit the minister did n-ot file any comparison between the rates from eastern Canada to the west, -as against, one point in Ontario to another point in the same -province. He wa-s asked by M-r. Hoey:
As a matter of fact, would not that mean increased freight rates for eastern Canada?
That wias the general application o-f the Crowsnest pass rates. The minister replied:
It is not my intention to discuss freight rates; but I repeat, if the Crowsnest pass basis of rates is to be made a yardstick for freight rates in the Dominion, you may as well give away your national railways tomorrow-[DOT]
What the -minister filed was a statement dealing with the discriminations on the westbound shipments; but I think, that between eastern Canada and western Canada, as a matter of record, as a matter of undenstand-ing between the people of -the east and west, we should learn whether or not in the case of these, commodities

because we are dealing wi-th specific -commodities-the rates in the east are higher or lower. We should get the true -comparison between the rates east an-d the rates west. I -claim-and I want to take a little time to put some statements on Hansard-that the rates in the east generally are lower than the rates in the west. When you take into consideration -the territory that is recognized as Crowsnest pass territory in the -prairies, the rates are much higher in the west; and even as between the Crowsnest -pass rates in the w-est the rates in general are higher in that part o-f Canada. I a-m not argluing in the meantime that -is unjust, but I do say this:	It is absolutely unfair to the
west-yes and to the west of Canada-that such statements should go unchallenged, that there should be in any -part of Canada a misunderstanding of the situation, and that the

Railway Freight Rates
people should not have a chance, at least, of June 7, 1924, of the present rates per hundred getting in touch with the facts 'Conveniently, pounds, I may say I took this from an exhibit I have here a comparative statement, dated filed before the Privy Council:
Comparative statement of the present rates in cents per 100 lbs. on various commodities, eastern and western Canada.
The stations and rates in eastern Canada are from the memorandum presented by the Canadian Pacific Railway and the Canadian National Railways to the Dominion Government requesting the suspension of the westbound commodity rates guaranteed under the Crowsnest agreement. The mileages are from the official distance tables of the companies.
The rates in western Canada are from Fort William to various stations in Manitoba, Saskatchewan and Alberta, Canadian Pacific Railway Tariff No. W74965, C. R. C. No. W2655. The distances are from the official distance table of the company.
Green and fresh fruits
Fort William to	Present western rates	St. Catharines to	Present	Miles	Rate	higher by	Miles	Rate585	99	45% 57%	584	68 65Virden, Man	600	102	Sherbrooke	603	
Coal oil
Percival, Sask	 Tompkins		676 978	87 117*	57% 72	Sarnia, Ont. to Quebec	 St. John, N.B		673 980	55 68
Binder twine						
Fort William to	Present western rates	-	Present	Miles	Rate	higher by	Miles	RateBagot, Man	
Pilot Butte, Sask	491 767	68 98	30% 53	Montreal to St. John, N.B	
Halifax	488 767	52* 64
Agricultural implements
Chater, Man... Mortlach, Sask Tilley, Alta....
547	62	26% 50% 85%	Hamilton to	546843	92	8581,129	117	1,129
Iron commodities
	547 852	74 107	56% 88	Hamilton to	546 850	47* 57
Parkbeg, Sask					St. John			
Wire						
Portage la Prairie, Man	 Brandon, Man	 Sintaluta, Sask	 Wapella, Sask	 Wolseley, Sask		475 553 723 655 714	65 75 93 87 93	57% 80 72 66 56	Windsor to Ottawa	 Montreal	 Quebec	 Sherbrooke	 Megantic		479 555 729 658 727	41* 41* 54 52* 59*
Railway Freight Rates

Building paper
483-	66	90% 90	Portneuf to	482	35 38525	72	522	623	83	110	626	39
Paints and Oils
				Montreal to-	
	483	66	26%		488
					
Furniture
Kemnay, Man	561	84	19% 39	Kitchener to-	559863	120	863Brooks, Alta	1,142	149	60	1,142
Note the heavy percentages on the long hauls. The prairie provinces are a long haul country.



SUPPLEMENT

[Stage Direction]
Supplement to the statement dated June 12th, 1924, compiled from the memorandum of the railways with the rates from Fort William to stations in Saskatchewan for similar distances. Present rates in cents per 100 lbs. Eastern and western Canada.
Agricultural Implements
-	Western present rates	-	Present	Miles	Rates	higher by	Miles	RateFort William to-	Hamilton to-	Pilot Butte, Sask	768	84	36%	Me Adam, N.B.	766	61*Chaplin, Sask	872	93	51	Spruce Lake,	929	98	60	N.B	874	61*Edmundston,	N.B	929	61*
Binder twine
C.P.R. No. E2880, C.R.C. No. E3221
	885	111	67% 74	Welland to- St. John, N.B...	888
	943	116			
	964	117	75		
				N.B....'.		941
				Edmundston, N.B		967
					
C.P.R. No. E2880, C.R.C. No. E3221 Wire, iron, nails, etc.
Pilot Butte, Sask	768	98	72%	McAdam, N.B....	766	57Ernfold, Sask	885	111	93	South Devon, .	929	114	100	N.B	885	57Edmundston,	N.B	929	57
[Stage Direction]
Railway Freight Rates
Summary of statement compiled from memorandum of the railways, carload rates, eastern and western Canada.
Eastern Canada	Western Canada
Green and fresh fruits
Miles	Rate	Miles	Rate584..	
68	585	...66603..	
65	600	...68Coal oil	673..	
55*	676	...65980..	
68	978	...85Binder twine	488..	
52*	491	...56767..	
64	767	...80Agricultural	implements	546..	
49	547	...52850..	
61*	843	... 73*1,129..	
63	1,129	... 904Iron commodities	546..	. 471	547	... 59*850..	
57	852	... 84*Wire	479..	in	475	... 53555..	
41i	553	... 59*729..	
54	723	... 76*658..	655	... 68*727..	
59*	714	... 75*Paper, building and roofing, also roofing felt	482..	
35	483	...54522..	
38	525	... 56*626..	
39*	623	...65Window glass	Miles	Rate	Miles	Rate365	
45*	366	
40*Furniture	559	
70*	561	
69*863	
86*	863	
93*1,142	
88	1,142	149Paints and oils	488	52*	483	
48Woodenware	113	
37*	Ill	
40*121	
29	130	
40*173	
40	176	
40*215	
37*	211	
40*488	
55*	475	
53
In only five cases are the rates lower in western Canada than in eastern Canada. In all the other cases (24) the rates in eastern Canada will be lower than the rates in western Canada when the Crowsnest rates come into effect.
I have another statement here dealing with carload rates. I am going to ask the privilege of putting this statement on Hansard also but I think it ought to appear beside the statement of the Minister of Railways or very near it. This is exhibit 59, a comparison of the Crowsnest pass rates from Fort William with the rates for similar distances from various points in eastern Canada:
Comparisons of the Crowsnest rates from Fort William with the rates for similar distances from various stations in eastern Canada, Schedules A to M, carload rates in cents per 100 lbs.
Schedule A. Green and fresh fruits
East					West	
Miles	From	To	Rate	Miles	Fort William to	Rate584	63	565	66603	65	600	68
Schedule B. Green Apples
The rates to points in eastern Canada are for distances 116 to 406 miles. The only comparisons obtainable are those from Fort William to stations east of Winnipeg and the rates are the same as to Winnipeg under the Crowsnest tariff.
Schedule C. Coal oil
Miles Rate	Miles Rate
Sarnia to Quebec	
673	55*	Fort William to Percival, Sask.	676	65Sarnia to St. John	
980	68	Fort William to Tompkins....	978	85
Schedule D. Binder twine
The rates from Welland to various stations, short hauls, are lower than from Fort William for similar distances; Welland to Windsor 212 miles, 34* cents; Fort William to Dryden 211 miles, 40* cents; Ontario Government experimental farm at Dryden.
Schedule E. Agricultural implements
The rates from Hamilton to eastern points are all lower than from Fort William for similar distances - Hamilton to Halifax 1,129 miles, rate 63. Fort William to Tilley, Alta., same distance, rate 90* cents, 44 per cent higher.
Railway Freight Rates
[Stage Direction]
Schedule F. Iron commodities
The rates from Hamilton to eastern points are all lower than from Fort William for similar distances:
Hamilton to Quebec	
Fort William to Chater.. Hamilton to St. John- Fort William to Parkbeg
Miles	Cents	
546	474	
547	594	
850	57	
852	844	(nearly 50%
		higher)
Schedule G. Wire
The rates from Windsor, Ontario to Eastern points distances. The longest distances are:-
Windsor to Megantic....
Fort William to Wolseley
are all lower than from
Miles
714
Fort William for similar
Cents
59|
754 (about 25% higher)
Schedule H. Paper, Building and Roofing, also Roofing Felt
The rates from Portneuf to Eastern points are all lower than from Fort William for similar distances. The longest distances are:-	Miles Cents
Portneuf, Que. to Hamilton	
522	3SFort William to Carberry	
525	o6J	(nearly	50%Portneuf, Que. to St. John, N.B	
626	VnVbprtFort William to Kirkella	
623	6o (62%	higher)
Schedule J. Window Glass
With the exception of the rate for 365 miles, which is 5 cents per 100 lbs. lower, the rates from Montreal are
lower.	„ .	,
Schedule K. Paints and Oils
Montreal to St. John	 488	522-
Fort William to Burnside	 483
This is one of the very few cases where the Eastern rate is higher.
Schedule L. Woodenware
The short haul rates are lower in the East.
From Ottawa to St. John	 *
From Fort William to Portage La Prairie
Miles
475
This is another of the very few cases where the Eastern rate is higher.
Cents
53
Schedule M. Furniture
With one exception, a difference of one cent per 100 lbs. all the Eastern rates are lower.
Kitchener to Halifax	
Fort William to Brooks, Alta
Miles Cents
1.142	88
1.142	149 (70% higher)
The application of the remainder of the Crowsnest rates will remove some of the disparity which at present exists in the rates which the Prairie Provinces have to pay.
I said a little while ago, Mr. Chairman, that there might be considerable difficulty in estimating whether or not the rates between the east and the west were on a parity, but I have read some of the judgments of the Board of Railway Commissioners on that question, and 1 think they are fairly clear. If would be unfair, I suppose, to base^ an opinion with regard to the general freight rate structure on a few individual rates such as I have quoted, but when in conjunction with those you take the judgments of the Board of Railway Commissioners, I think I am not far out when I say that we have 
still higher rates, in the west, and we will have a still more intense discrimination between the east and the west, even with the discrimination between grain and flour removed, if the Crowsnest pass agreement is suspended in respect of the other commodities that are covered by that agreement.
It would seem to me, however, that if eastern and western Canada can pay the operating charges on the railways, situated in eastern and western territory, and take care of their own fixed charges over and above that, they are doing fairly well. The hon. member for West York (Sir Henry Drayton)

Railway Freight Rates
gave us some figures yesterday to show that they are not doing that. I have looked over his statement, and for the life of me I cannot see how he can justify that statement with the figures he submitted to the House. It would seem to me that if we take the gross earnings, and subtract the operating costs and the fixed charges, and if we have any idea at all about the investment in the east and in the west, then we ought to know whether or not the east and the west are paying their share of operating costs and fixed charges for the service they are getting. I want to qualify that statement, however, with this further statement: I do not believe it is the duty of the people who are producing revenue tonnage in Canada to pay rates that will pay for all the railways in Canada, regardless of the wisdom of their location and regardless of the lack of economy with which they have been constructed. The Canadian Pacific has been taken as the index railway for setting rates east and west. I maintain* that that is not a fair basis, and I will tell the House why. We have three main lines of railway, running from Winnipeg right through to Edmonton, and I think one main line of railway would handle all that business. Certain portions of the Canadian Pacific railway between Winnipeg and Edmonton can hardly be considered worth one hundred cents on the dollar, if the Grand Trunk Pacific and the Canadian Northern alongside cannot be considered worth one hundred cents on the dollar. And we cannot under present conditions produce the traffic to make all three roads pay because of their location and because of the money that has gone into them. If we had spread over that territory one expensive main line and a lot of cheaper branch lines, we would then have a system on which the producers of revenue tonnage might be expected to pay rates that would take care of operating expenses and fixed charges, but because the Canadian Pacific has mileage extending over hundreds of miles that runs alongside and twists around the Grand Trunk 4 p.m. Pacific almost like the strands of a rope

and at other places the two railways look like one line with a double track-I maintain that under these conditions the present valuation of the Canadian Pacific railway must be revised to some extent in connection with the consideration of this matter. That seems to be a fair deduction.
The hon. member for West York gave us figures yesterday showing (he difference between the east and the west per ton mile
gross earnings-in 1918, 79 on the eastern lines and 904 on the western lines and so on. Now for the life of me I cannot see the significance of the per ton per mile figure. I can see where it would have a bearing if you take it in conjunction with a lot of other factors, the gross earnings per mile, the operating ratio, the gross and net return, and so forth, but when these factors are all ruled out, as has apparently been done in this case, I cannot see how the per ton per mile figure alone can be taken as a basis for comparison at all. We have two new railways in the west that are not fully established yet, the Pacific and Great Eastern in British Columbia, and the Edmonton, Dunvegan and British Calumbia. At present the rates there are higher than on the other lines. Would that not mean that the ton mile rate on all traffic moving over those lines would be higher than the ton mile on traffic moving over the line where there is a lower rate? But that figure alone pays no attention at all to the volume of traffic, and the volume of traffic has a tremendous deal to do with the question whether the railway is going to pay or whether the rate is just or not. I believe that the figures of the exMinister of Finance, the ex-Chairman of the Board of Railway Commissioners, will have to be ruled out so far as I am concerned, until I get some further information. After giving those figures the hon. member went on to refer to the grain rates in the olden days, and told us how profitable the business was, but in order to do that he referred back to the very favourable operating ratio. For the life of me I cannot see why this should be used in the one case and'ruled out in the other. In exhibit 60 before the Privy Council of June 7th, 1924, the operating ratio of the Canadian Pacific Railway, for five year periods; line east; lines west except British Columbia; all western lines; and, all lines; the figures are given as follows:
1912-1916
72	66	60	6573.3	54.5	57	63.380.95	....	67.30	73.52
The operating ratio in eastern Canada is a good deal higher than the all line ratio. It is still higher than the British Columbia and prairie ratio and it is nearly fifty per cent higher in some instances than the ratio on the prairie provinces. In exhibit 60 I
Railway Freight Rates
[Stage Direction]
find, operating revenue, operating expenses, net earnings, with percentages, Canadian
Operating revenue
1907- 1911
Millions Per cent
East	
$160	40.92West	
231	59.08
I am not going into the figures any further, because I wish to get through; but if we take the earnings in the east and west over these periods and up to 1922 you will find those figures will be borne out pretty well. We will find that the net earnings in the west run nearly 100 per cent higher than the other. I think Mr. Lanigan before the committee on Railway Transportation Costs said the reason for that was that we had 62 per cent more mileage in the west than in the east, but I do not think that tells the whole story or anything like it. We know that the cost of railway construction in the east is just about twice what it is in the prairie * provinces, and as high as it is generally in British Columbia. In the eastern rates case the Board of Railway Commissioners tell us what the cost of various railways in the east was.
The Glentay-Aginicourt branch of the Canadian Pacific Railway cost around $70,000 per mile; the Grand Trunk line cost $130,000 per mile, ibut in the east we know that the prairie lines have been built for $13,000, $20,000, and possibly up to $30,000 or $35,000 a mile. Last year .Alberta built two stretches of thirteen, miles irn the Peace river country for about $22,000 per (mile. So that even if we have sixty per cent more mileage in the west, the actual investment in the east will be just about equal, on a rough calculation, to the investment in the west. In view of that fact, where our net earnings in the west have been for- years almost twice the net earnings in the east on the Canadian Pacific Railway,, it is a fair conclusion that we have been in general paying more than our expenses and our share of interest charges. Therefore I feel that I have not any right, as a representative of the prairie provinces, to admit that the principle of this bill is sound when it takes away from us a maximum that does not now fix rates lower in western Canada than in eastern Canada. When I know that the opinion of parliament has been in the past that the rates should apply generally, and I think that should be followed in the rates at the present time. So -far as the province of British Columbia is concerned, I stand where I stood some months ago on this question, when I spoke from my place in this 
Pacific Railway, for five year periods to December 31, 1920, as follows:
Operating Expenses	Net earnings
Millions Per cent $434,	32.30
9l|	67.70
chamber. I believe we ought to have these rates west, and because of that I believe we have another complaint that this bill is not satisfactory in its present terms. The Prime Minister this afternoon took the position that has been taken so often in this chamber by members on the government side of the House. The government stands between the two extremes of the House-the Conservatives who want one thing and the Progressives who want another. I do not think that is a very strong position afteT all.
-Mr. iMidMJASTER: The golden mean.
Donald MacBeth Kennedy: The question is what is right, and not whether you are in the -centre or in the radical group, or Conservative group. The position has been taken with regard to the -tariff, and it has been taken this afternoon with regard to rates, if it can be shown that the rates in eastern Canada should go up beyond the rates set in the Crowsnest pass agreement, that under those conditions we were not paying our share of fixed charges in addition to the operating costs on lines properly built and laid out in the west-


Mr.   M@: -.M ASTER: And properly managed.


Donald MacBeth Kennedy: And properly managed. 1-f that -can be shown, then I say there would be some justice in the legislation. But there has been no attempt to justify it. We had the statement from the leader of the opposition that the railways dropped something like $40,000,000 in th-e revenue last year, but that was not th-e net loss, as compared with 1923. The net loss was about $3,000,000.


An hon. MEMBER:: A small western crop.
-Mir. KENNEDY (Edmonton) : One reason given is the small crop in western Canada. There are -certain people who would like to get a share of this $2 wheat. I would not object to that, if, when wheat happens to come down to $1, the rates would follow, but they have not been doing that very -generally. I am glad that the rates are fixed on wheat and flour to the extent they are, but I would like to see the rates fixed going westward to the Pacific, as well as going eastward.
Millions Per cent 3116	45.49
139	54.51

liailway Freight nates


Thomas Langton Church: The question at present before the committee is the most intricate one that parliament has had to deal with. I sympathize with the Minister of Railways and Canals (Mr. Graham) in his task because, after three days debate we have had nothing but sectional appeals from British Columbia, the three prairie provinces and the Maritime provinces. We would have a nice rate structure in Canada if all those class, sectional and provincial appeals were to be listened to by the minister. We would have a rate structure the like of which has never been seen before. It would resemble the tower of Babel. I am not going to make any sectional appeal for Ontario because although central Canada, as was pointed out by the hon. member for Sherbrooke (Mr. McCrea) the other night, is paying not only about SO per cent of the taxes of the country, but in the same proportion to build railways out to the coast and for capital and maintenance charges, we are not complaining in Ontario. We admit that the west has grievances. We admit that British Columbia has grievances and we admit that the Maritime provinces have grievances, but Ontario says nothing and has more at stake than any other port of the country. All Ontario wants is a fair show and equality of treatment. While the Maritime provinces, incited by the example of British Columbia and the prairie provinces, are making sectional appeals, an examination of freight schedules shows that their rates to northwest points are substantially lower than those for equivalent distances from points in Ontario and Quebec, while their freight tolls to eastern destinations are the same as Ontario and Quebec pay for similar service. Last session political pressure was brought to bear for the construction of additional railway mileage in the shape of branch lines, in spite of the fact that Canada's railway problem is the result of over-construction. I do not intend to make any appeal for the province of Ontario along those lines, because the main question before the committee is how to secure equality of treatment and to eliminate the evils of duplication in roads and unjust and undue discrimination.
The railways have a commodity to sell, namely, transportation. Instead of being able to sell it like any other commodity in accordance with the law of supply and demand, this transportation is hemmed in with all kinds of laws, human and divine regulations and legislative restrictions, sectional interests and protective measures for various sections of the country. Transportation is
not a free commodity. There is discrimination in the sale of it, and .both sectional and provincial interests are concerned. According to speeches that have been delivered, political considerations seem to prevail instead of economic considerations in settling the question of rates. Freight rates from the standpoint of the railways and their bondholders should serve four purposes, namely, to provide :
1.	Operating expenses.
2.	Money for sinking fund and fixed charges.
3.	A reasonable dividend on the investment.
4.	If possible, some money for betterments and extensions.
We have never had a proper economic rate structure in Canada. We have always had a political rate structure. A proper rate structure is based, not on sectional considerations, not on giving certain districts certain rates on basic products to the discrimination of the rest of Canada, which discrimination the rest of the country must make up for in the deficits, but is based on some economic law and principle, on the principle of equal rights to all sections of the country and special privileges to none. Otherwise, there is no way of preventing unjust, undue and unfair discrimination. This debate in my opinion, illustrates the weakness of the group system of government which seeks selfish things for its class. This is one of the most important features of the group system of government. This weakness has been illustrated by the sectional appeals which have been made by hon. gentlemen to my left at the expense of the rest of Canada. They do not care who make up the deficit. They believe out west in free trade, yet to-day in their railway rates, they have the most acute form of protection there is in the world. Further, if branch lines were built according to the law of supply and demand, many branch lines would be eliminated. You could not find a private corporation that would build them. Each group or section wants to get what it can for its district irrespective of the general interest of the rest of the country, and the undue and unjust discrimination that must result therefrom. In the present legislation, while I sympathize with the task the government have, yet I do not admire the way they are carrying it out. I think, on the whole, they are doing exactly what the railways want. First, they have repealed the Crows-nest pass agreement which is the basis of the whole rate structure of this country, except as to grain and flour. They do not care where
Railway Freight Rates

the grain and flour goes. It goes by rail to the head of the lakes. A lot of it goes by Buffalo where there have been erected twenty-eight elevators, getting Canadian grain from Canada. Buffalo will benefit thus at the expense of Vancouver. With the exception of grain and flour under the Crowsnest agreement, the whole question of the adjustment of railway rates is left to the railway commission, and they are amending the Rahway Act to bring this about. This is treating two certain agreements like scraps of paper, first the Crowsnest pass agreement and then the Manitoba Rate Act. The government are fixing rates by legislation on certain products, grain and flour eastbound, favouring certain products in certain localities at the expense of others. They are favouring eastbound traffic at the expense of north and westbound traffic. This is a mistake. Freight rates for the city and town man in Canada are high enough, dear knows, and yet the farmers enjoy fairly low charges on their products as compared with those on other commodities. The grain growers of the west have favourable and preferential rates, and as a result all other classes pay much higher rates in order to make low rates to the western farmers possible. Why this unjust and unfair discrimination against central Canada? The Drayton-Acworth report states:
Railway policy is a sealed book to the ordinary citizen. Why tariffs should be fixed as they are, why the train service should not be arranged so as better to suit his individual requirements, why cars cannot always be available for everybody everywhere, he cannot understand. The normal attitude of the public towards the railway management whether in the hands of a company or a government, is one of mistrust, if not of active hostility. It is a good thing both for the railway itself and for its patrons to bring the management out into the open; to have the reasons why such and such conditions exist, why certain concessions demanded cannot reasonably bo granted, frankly explained in public.
The public have just cause for such a belief, the way parliament has fixed rates by legislation. The abrogation of the Crowsnest pass agreement except as to grain and flour east-bound is in the nature of a subsidy to the three prairie provinces at the expense of the other provinces. What east or north or south or west has to do with economic rate regulation, I cannot understand. You have to see the ancestry of this bill in order to understand the rate structure this country has had from time immemorial. The basis of the whole rate structure is the Crowsnest pass agreement. I wish to see the west get everything it can out of the Crowsnest pass agreement, because if it is to be made a scrap of paper, those who will benefit by that will

be the Canadian Pacific. They should be taken into the Exchequer court and an accounting made, and they should give back to the people with interest the $3,500,000 they got by way of a subsidy. British Columbia gave them 3,500,000 acres of the richest mining lands in the west and they made a fortune out of it. Yet the railway commission has scrapped this Crowsnest pass agreement. There is no country in the world except Russia that has been scrapping agreements and signed contracts in the way the railway commission has been doing in Canada. First, the railway commission has treated the Crowsnest pass agreement as a scrap of paper. The Canadian Pacific Railway wants to repudiate its agreement, and it is upheld by the railway commission.
Now, let us consider some of the privileges which have accrued to this railway system from the Crowsnest pass agreement. By order in council passed at the time the Crowsnest agreement was entered into the Canadian Pacific Railway received the following privileges. They were granted $11,000 per mile for 330 miles of the Crowsnest pass section of the Canadian Pacific Railway, or a total subsidy of $3,630,000. They were also given a British Columbia subsidy, including 3,500,000 acres of land, and the land grants included the whole area of the Crowsnest pass coal sections. The Canadian Pacific had to hand a portion of these coal lands over to a syndicate of eminent Toronto Liberals who capitalized their rake-off in coal lands at $10,000,000. Of that $10,000,000, $6,000,000 was issued and largely sold. And the obligations of the Crowsnest pass agreement were undertaken by the Canadian Pacific Railway as a sacred contract, to which the railway put its hand and seal. The Canadian Pacific Railway, it must be observed, guaranteed that freight rates on certain specified commodities shipped over its line should never exceed a fixed minimum stated in the contract. Canada's railway commissioners, Messrs. Oliver and McLean dissenting, last fall crowned the Canadian Pacific Railway campaign of repudiation with the laurels of legal victory. The weapon of the Canadian Pacific Railway's warfare for the repudiation of the Crowsnest pass agreement was the one word "discrimination." But Canadian Liberalism was not entirely for the Canadian Pacific Railway in 1897. Sir William Mulock at that time fought the Crowsnest pass deal almost to the point of resignation; and Mr. J. F. Lister, then member of parliament for West Lambton, attacked the Laurier-Sifton proposals for the construction of the Crowsnest pass railway. They opposed it in the
June is, 1925
Railway Freight Rates
Liberal caucus at Ottawa, and Mr. Lister actually carried the Liberal caucus against Sir 'Wilfrid Laurier, who then exercised his authority as Prime Minister and informed the caucus that the Crowsnest pass deal would have to go through or the government would go out. The Toronto Globe spelt the doom of honest Liberal resistance to the Crowsnest pass folly. Sir John Willison, for weeks and months, carried the slogan across the page of that newspaper, "Concessions for Concessions," representing the maximum rates proposed in the Crowsnest pass contract as then, in 1897, and forever applicable to shipments from every point on the Canadian Pacific system in Canada. Ontario and British Columbia Liberalism, however, generally resisted the cor-porationizing of their party. Sir William Mulock and Mr. J. F. Lister would have beaten the Crowsnest pass proposals to death if parliament had ever understood that the Canadian Pacific Railway had the right to apply Crowsnest rates to shipments from certain points while refusing those rates to shipments from other points.
Now, what is the use of the Supreme Court of Canada and the Board of Railway Commissioners writing into the contract something that was never in the minds of the parties to that contract, something that was altogether foreign to the original intention? I have here extracts from speeches delivered in parliament in 1897, and while I will not weary the committee by reading them, I may mention for the information of hon. members the pages of Hansard of that year at which the views of these several gentlemen may be found. For example, at page 5347 of Hansard of 1S97 the Minister of Railways and Canals of that day, the late Mr. Blair, expresses himself in strong terms in relation to the agreement. At page 4581 of Hansard of the same year Mr. Mclnnes said in regard to the concessions:
But even if they were of enormous nominal value, you will admit that they are, so far, mere paper concessions and that the real value of them will depend on their administration.
But although he qualified himself to that extent he did not think that the deal was at all advisable. He was opposed to it. At page 5182 Mr. Wallace declared that in his opinion that part of the bargain providing that the Crowsnest pass railway should come under the General Railway Act was not worth five cents to the country; nor, in his opinion, were the concessions given by the Canadian Pacific Railway. Again, at page 5344 of Hansard of the same year, we have the views of Mr. Lister on the subject.
Time will not permit me to quote the opinions of these gentlemen, but hon. members will find them interesting reading. Now, if the Mulock Liberals and the Lister Liberals had defeated the Crowsnest pass deal they would have saved this country, it is estimated, some $400,000,000. The surrender to the Canadian Pacific Railway in the Crowsnest pass fight was the beginning of this country's railway misfortunes. These mistakes and follies were the source of all Canada's railway troubles, and the cash cost of these troubles now totals nearly $500,000,000. The $55,000,000 deficit on the year's operations of the Canadian National Railways had its origin in the Crowsnest pass iniquity and is a yearly burden which we can attribute primarily to that source. The directorate of the Canadian Pacific Railway have conceived and disseminated this propaganda of "the iniquity of discrimination" as a means of empowering that company to repudiate the Crowsnest pass contract. In my opinion Canada's railway commission should have abolished this discrimination by deciding that the Crowsnest rates should stand; they could have abolished the discrimination by the simple expedient of maintaining the Crowsnest pass contract. But Canada's railway commission chose to bring about this end by the appalling decision that authorized the friends of the Canadian Pacific Railway, as the Soviet government does in similar circumstances, to repudiate its contracts. Why should the Canadian Pacific Railway be permitted to keep the Crowsnest pass cash and coal land subsidies as well as other valuable considerations which they received, while they are allowed to disregard entirely the agreement by means of which they secured these considerations? A Crowsnest pass contract that is no longer a contract but merely a scrap of paper, as regards reduced freight rates which the Canadian Pacific covenanted to give, should certainly not be considered a contract in regard to the enormous subsidy which this country not only undertook to deliver but actually did deliver to that company. I would make the Canadian Pacific Railway carry out its contract. I believe if part of the Crowsnest pass contract is scrapped as now in this act, the whole of it should be scrapped, and the Canadian Pacific Railway should be taken into the Exchequer court and forced to give back all the subsidies and other valuable considerations and privileges which it received under the contract from the government of Canada and the government of Manitoba.
With all respect to the railway commission, I regret to say, Mr. Chairman, that it has no
Railway Freight Rates

longer the confidence of the people of Canada. The municipalities of Ontario in the past few years have had about a dozen cases before the board regarding telephone, express, freight and passenger rates, and in every case the board accepted the figures submitted by the public service corporations and granted their applications for increased rates. In fact, the railway commission is really a political commission, for its orders are subject to appeal to and revision by the Governor in Council, and in that way its activities are not removed from the realm of polities. On the contrary, the Interstate Commerce Commission in the United States is absolutely free from political interference and its decisions are based on economic principles and are just and equitable. According to the Kailway Act the Board of Railway Commissioners are supposed to deal with rates of their own volition on the principle of equality of treatment for the whole Dominion, but the board has never been known of its own volition and for the protection of the public to go out and fight and check up freight, telephone, express and passenger rates from coast to coast. In my opinion the railway commission should be reconstituted, reorganized and placed then in a position to deal with the adjustment of rates absolutely without any right of appeal from its decisions to the Privy Council of Canada. Then it would be able to determine these matters, not on sectional but on national lines, basing every decision on the principle of equality of treatment. If we had had chief commissioners like the late Mr. Justice Mabee and the ablest chairman the board ever had, the hon. member for West York (Sir Henry Drayton), we would not have these troubles to-day. They never fixed rates that were not just and equitable to everybody concerned and they had public confidence. In 1909 the Bell Telephone Company were charging $80 to $100 per telephone per annum in the Deer Park district, while just across the road where their regular tolls were in effect the rate was $32. We took the case to the railway commission, and Mr. Justice Mabee wielded the big stick on the telephone company. He said that it did not cost a consumer any more for his electric light, his water, or his gas because he was further away from the source of suppiy than some of his neighbours, and the same principle should be applied with respect to the telephone. So he brought to time that company which had been paying eight per cent for thirty-two years and ordained a flat rate for the whole city of $32. If we had more men of the type of the late Mr. Justice Mabee and his successor the

hon. member for West York, the municipalities would have more confidence in the commission. They never fixed rates on any sectional principle, but always on the principle of equality and justice and fair dealing, and therefore their decisions were always just and equitable.
It is all very well for the government to give eastbound grain and flour the benefit of the Crowsnest pass agreement, but what about other sections of the country and their products? The people in eastern and central Canada will have to pay for the piece-meal abrogation of the Crowsnest pass agreement. All along the railway commission has failed to protect central Canada. The east paid the biggest part of the cost of constructing western lines, and it should not be discriminated against by such class legislation as this. The railway commission should do its part or be removed; it should see that any order it issues does not rob Peter to pay Paul, as has been the practice in the past. It is unfortunate that while we are united in many ways, owing to our rate structure being built largely on sectional and political lines, on transportation matters we are rent asunder instead of working together for the good of the Dominion. I sympathize with British Columbia, with the prairie provinces and with the Maritime provinces, but while they are contemplating their various ills, I would ask them not to forget old central Canada which has borne the heaviest burden of the national debt, which is paying the largest proportion of the taxes and does not object to continue doing so, but simply asks for just treatment-fair rates based on economic and not sectional principles and, in short, a square deal all round- equal rights to all, special privileges to none.


Donald Sutherland: Mr. Chairman, at
this late stage of the debate one can hardly hope to exercise much influence on the government or the House, for presumably the government at last has made up its mind in regard to this question. Our railway problem is to my mind the greatest that we have to face in Canada to-day. So much depends upon transportation that anything that can be done to free the people from inequality of freight rates should merit the careful consideration and approval of the government. I believe that our burdens of taxation and railway costs of transportation are crushing industry to the ground, and are responsible for many of our natural resources remaining dormant and undeveloped. The mad, drunken spree of railway construction extravagance that this country indulged in a few decades ago appeared to be a nightmare to many of

Railway Freight Rates
us for a long time, but we are beginning to realize that it is a very uncomfortable reality, and we are now paying the price. The consequences of that folly cannot be evaded. The railway problem must be faced by the people as a national unit, rather than in a selfish sectional spirit, one section endeavouring to obtain an advantage regardless of its effect on the other parts of the Dominion. From the expressions of opinion which we have had on this bill, it is absolutely hopeless to expect freight rates to be satisfactorily adjusted by parliament. I believe that the Board of Railway Commissioners is the proper tribunal to deal with this matter. Iif that board is not properly constituted to deal with the problem then men with a thorough training and experience along these lines should be appointed to that body. I am not criticizing the present board, but I do contend that the railway commission is the proper body to adjust railway rates. There is such a great need for expert knowledge in connection with this question that it is absolutely hopeless for a member of this House, with his other duties, to become seized of the facts and arrive at a proper decision as to what the scale of rates should be. I am at a loss to understand, in view of the old Crowsnest pass agreement which has been a disturbing factor in this country for many years, why the government do not give the railway commission absolute power to deal with this question. Why have they obtruded this phase of the matter in such a way as to tie the hands of the commission, and prevent an adjustment of rates that would result in an equality in all parts of the Dominion? Hon. gentlemen to my left are apparently very suspicious that western Canada would suffer as a result. Well, if that is the opinion of people in some provinces what is the use of having a railway commission at all? What is the use of such a board if we are not going to place confidence in it, if we are not going to give it full power to deal with this matter? Everyone admits that it is impossible for us to handle the situation as it should be handled in parliament. Apparently the government, have no views on the question themselves. In the session of 1922, on May 4, they appointed a select committee to deal with the question of the Crowsnest pass rates and to report to parliament. We also had last night the views of an ex-minister of the present government (Mr. McMurray), a gentleman who resigned from the cabinet a few weeks ago, and he informed the House that it was always the intention of the government to have the Crowsnest pass rates go into effect
again. I have heard no satisfactory explanation-an fact I have heard no explanation at all-as to why the government are going to introduce this fragment of the Crowsnest pass agreement into the railway rates structure. The Prime Minister waxed eloquent shortly before the House rose at one o'clock as to the government's desire to have equality of rates in Canada, and yet we have the most positive evidence in this legislation that the government do not propose or intend to allow anything of the kind. On- the contrary the bill we are now considering will render it impossible for the railway commission to do its duty as it was supposed to be anxious to do.
The conditions in Canada to-day are not the same as they were when this agreement went into effect; they are entirely different from the conditions which prevailed at that time. The Crowsnest pass agreement is something that the people of this country knew little or nothing about until the last few years. It was one of the first acts of a new government in 1897. They tried their prentice hands on railway legislation and the Crowsnest pass agreement was the product of their efforts. It remained in abeyance for a long time. In 1903 legislation was passed creating the Board of Railway Commissioners, and they have been administering the railway rates, and questions arising in connection therewith ever since. But during the war time there was another condition which has apparently been overlooked, but which was referred to by the chairman of the railway commission in 1921 when the board made a thorough inspection of railway conditions in western Canada. I should like to direct the attention of hon. gentlemen to some of the remarks made by the chairman of that body at that time. They will be found in the Canadian Annual Review for 1921. I quote from that publication as follows:
The railway board visited the western centres in the spring of 1921, and heard various appeals and statements as to freight rates; outside of the commission sittings, Mr. Carvell continued >his outspoken utterances. [DOT]Speaking to the Canadian Club at Brandon on April 22, lie described the railway problem as more important than the tariff or any other question before the people.
I quite agree with him. I believe that railway transportation is the most important question in this country at the present time. He went on to say:
It cost $40,000,000 more to run the Canadian National railways last year than was brought in and that is no reflection on the people at the head of the railways or on the government.
I quote a little further on from this publication as follows:
Railway Freight Rates

At Victoria (April 11) he told the Canadian Club that freight rates on Canadian railways were too high; that in many cases they were having an adverse effect upon business; that under existing circumstances and the McAdoo and Chicago wage awards this could not be helped; that to force the railways to meet increased costs of operation without the privilege of raising rates or power of lowering wages would be to force the roads against the wall; that the financial stability of the Canadian Pacific Railway was as important to the country as good government. He declared that the root of the trouble was in payrolls forced upon this country by political agitation and labour efforts in the United States; that "the action of American labour men in putting a pistol to the head of the Canadian railway companies and demanding that the new American wage scale, fixed under the Chicago award, be male effective in Canada, placed the railway companies in a most humiliating position".
As to the future: "no matter what happens, railway labour must be re-born and an honest day's labour for an honest day's pay must be the first principle observed. Canadian labour is not responsible for the McAdoo award, but it is responsible if it is not prepared to give honest service."
Let me quote further;
His view of the labour situation was important because it could not but affect the policy and decisions of tlhe board: "there are engineers and conductors today who are making 54,000, $5,000, and even $6,000 a year as the result of the McAdoo award; I am beginning to be sceptical of the advisability of having Canadian unions controlled in the United States.
Dealing with this question in the Canadian House of Commons in the session of 1920 the Minister of Railways of that time referred to the affect of the McAdoo and Chicago awards which had been forced upon the government, and pointed out;
The wage bill for the year exceeded seventy-three millions, having, owing largely to the McAdoo series of advances, jumped from fifty-four millions in 1918. In other words, out of every one dollar of revenue you earn, seventy-eight cents passed directly, by way of wages, to the employees.
Now, these are conditions that did not exist when the Crowsnest pass agreement went into effect and we might as well realize that now as any other time, and why the government want to interject part of the old Crowsnest pass agreement into this legislation under present conditions is beyond my understanding. The rates in the bill in question are the rates on grain and flour, not rates on the by-products, not the rates on live stock; there is no inducement offered to the people in the district affected to convert the products of the farm into a finished product and ship it out in that way. No preference of that kind :s given now on mill feed. The policy of the government seems to be:	Ship out the raw
material in as crude a state as possible; exploit the resources of the country. Every inducement is being offered along these lines. If it is the intention of the government to afford aid to facilitate the production of these commodities why not adopt some other means. 
and leave it out of the Railway Act altogether? If it is a form of protection that is going to be adopted for certain classes in certain sections, let us frankly admit it, but keep it out of the railway rates structure, and allow the railway commission to adopt a rate schedule that will apply without prejudice in all parts of the country.
When this matter was taken up by the government in 1922 everybody knew-in fact the Prime Minister himself made the statement-that the railway commission and the boards which were operating the Canadian Pacific and the Canadian National railways were waiting to see what action the government was going to take in regard1 to the Crowsnest pass agreement before reducing rates on the railways. They were waiting as far back as 1922. I say that the railway commission has not been treated fairly in that the government have not been honest with them, have not let them know what their policy was with regard to the Crowsnest pass agreement until this late day. Early in the present session we had a decision given by the Supreme court with regard to the validity of the act, which was found to apply to certain sections of the country and not to others. It was shown to have been a piece of freak legislation at the outset, and it is entirely inapplicable to conditions in this country today. We may well feel anxious as to the future of our country. We have had during the present session, which is considered by some to be the last session of this parliament, all the evidences of a government that had absolutely no regard for the financial situation which confronts the country. Political expediency apparently is the impelling influence back of the government, they are evidently now trying to make an arrangement with the Progressive group to my left to secure their support. My hon. friends to my left are protesting that they are not getting enough in this measure; they want also to have a cheaper rate on goods shipped from the east, into	the prairie provinces as well as
on commodities going out.	That is
the only thing that will satisfy them. It is only a few weeks ago that they insisted upon the completion of the Hudson Bay railway, and' yet they are complaining about the duplication of railways in western Canada. Well, duplication is not confined to western Canada. We have the same thing in Ontario and in other parts of the country. The old Intercolonial has even been duplicated by the Transcontinental. It was absolutely unfair to the people and uncalled for, but because of the extravagance of the government during

Railway Freight Rates
the early part of this century we have now to pay the penalty for all this duplication, and that is the main reason why it is impossible to get people to go on the land and continue on the land in this country.
It is all very well to say, give the board that is administering the Canadian National railways, a free hand, and allow them to carry on just as they see fit, regardless of the deficits that may result in the operation of the railway; so long as the people of this country will come forward and make up the deficit, in connection with operation, that is what is being done. We are going backwards. We are slipping back at the rate of about $100,000,000 a year in our operation of government railways, and where we are going to land is quite apparent to anyone who has watched the proceedings of this parliament during the present session.	I consider the conduct of the
government in providing for lavish expenditures during the present session, nothing	more or less	than a crime
against the country. And while this is going on there are people in this country by the hundreds, yes by the thousands, who are packing their bags and looking to some other country in which to make a home. It is a serious matter to these people when they have to abandon the country in which they were born, and in which all their interests have been centred during a lifetime. These are the conditions with which we are confronted at this time. What are we doing to meet them?
On this question of railway freight rates the government have dilly-dallied from the outset. The Prime Minister admitted when that committee was appointed, in 1922 5 p.m. that the government was holding up this question of the adjustment of rates until they saw what the findings of that committee would be, and now here we are in the last days of this session in 1925 considering this question. As far as the convenience of the members of this House is concerned, I do not think it matters much whether we get through here in a few days or have to stay here the whole year, now that we have made such a bungle of the country's business. But the government are responsible, and they cannot evade the responsibility. They cannot place it upon this House. The government must accept the responsibility for crippling the railway commission, for interjecting this disturbing element into the railway rate situation in this country. The government must accept the responsibility, and the sooner the people have to decide this 285
matter between the government and themselves the better it will be for all concerned.
I had no desire to participate in this debate, but I have taken the stand from the very outset when this matter was up three years ago that the government should deal with it, and not pretend that they were having a committee of the House appointed to deal with it. In the Speech from the Throne at the opening of this session the question of railway rates and the question of ocean freight rates were two of the chief features dealt with as they also were of the debate on the Address, yet the government sat here day after day during that debate, dumb as oysters, and they would not declare what the government policy was with regard to these questions which had been featured in the Speech from the Throne. We now know the reason why. It was because they wished to bring in this matter at the tail-end of the session in the form of a bill such as we have before us to-day with the hope of getting it through. I believe the predominating influence with this government has been none other than political expediency, bargaining and bartering with certain influences in this country rather than carrying out the view which I am sure the Minister of Railways must entertain with regard to the question.
I do not intend to say anything further with regard to the matter. I am absolutely opposed to this legislation, which interferes with the railway board, which ought to be enabled to deal with the question of railway rates in this country, and also with an adjustment of the scale of wages paid to the employees of the railways, and other privileges extended to them under the awards which have gone into effect in years gone by, with an absolutely free hand.


Mr. HUMPHREY:: The hon. gentleman
read certain statements, one from the late chairman of the Board of Railway Commissioners and another from the ex-Minister of Railways, casting certain reflections with reference to the wages paid to railway employees. May I ask if the hon. member is not aware that since 1920 the railway employees have contributed to the Dominion of Canada $45,000,000 per year in reductions in wages?


Donald Sutherland: I do not know what my hon. friend means when he says they have contributed $45,000,000 to the Dominion of Canada.


Levi William Humphrey: That is the admitted reduction in wages.

Railway Freight Rates


Donald Sutherland: Undoubtedly there
have been some reductions made, but there is in effect to-day a scale or classification in regard to wages, and as to time, that I think is sadly in need of adjustment. I quoted statements made by the chairman of the Board of Railway Commissioners at that time. I could give further statements, if I thought it would be of any interest. I might point out that there has been an evident attempt on the part of interested parties to make the railway question a political question. I have before me the main editorial in the Toronto Globe of December 12, 1921, which says:
There were cries of "treachery" when the two leading Conservative papers of Montreal, a few days before the polls opened, ceased to support and began to criticize the Meighen government.
Further on I find the following:
In effect, putting the matter bluntly, the Montreal Star and Gazette, and the powerful group of financiers for which they speak, ceased to help their friends of the Conservative party because Mr. Meighen and his supporters stood to their guns on the question of public ownership and operation of the National Railways.
I am not going to refer to any more editorials, further than to point out that there are certain influences in this country which are determined to have their own way regardless of the general effect on the whole country, and to my mind the only possible way we can deal with this matter is to have a railway commission who are competent, who will exercise their judgment to the best of their ability and who will deal with this matter free of influence from the government or any other source. They must deal with this matter. They are the only people who can deal with it. We have interested parties who are continually using their influence to promote their own ends. We see the result in the stagnation of business. We find our country so badly crippled to-day that we are doubtful as to the future. This matter should be in the hands oif the Board of Railway Commissioners, and consequently I am absolutely opposed to the bill.


Leon Johnson Ladner: I asked the Prime Minister, when he made his statement this morning, a very short question of 'considerable importance to British Columbia. He did not cover it in his statement, and I have written out the question. The Prime Minister referred to the policy of acquisition, and created the impression that it was a policy extending to British Columbia in which we are vitally interested, and I desire to get an answer to my question, which is as follows:
Will the government say now as its definite policy that if British Columbia appealed to the Governor in Council from an adverse ruling of the Board of Rail-

way Commissioners, the government would set aside any ruling of the board which would increase the rates to Vancouver beyond the present rate of 22J cents?
Would the Governor in Council on appeal, so far as the government policy is concerned, fix the rate on grain moving from the prairie provinces to Pacific coast ports at a rate equal to the present Crowsnest rate on grain going eastward so that the present 22i cent rate from Calgary would become 18 cents?
On the word of the Prime Minister favouring equalization, I do not see how the government could honourably refuse to do so. Does the Prime Minister not think British Columbia is entitled to that definite assurance by the government now?


John Warwick King: If my hon. friend is not accustomed to the proper reply to give to a hypothetical question, I will say to him that I should not wish at this moment to answer it. If an appeal were made to the Governor in Council on any matter it would be dealt with in accordance with what I have said to-day with regard to the government's policy.


The CHAIRMAN:: The question is on the first amendment, and I understand there will be no objection to this amendment carrying, in order to get on to the next section which is general.
The section as proposed to be amended by Hon. Mr. Graham would read as follows:
But such rates shall apply to all such traffic moving from all points on all lines of railway west of Fort William to Fort William or Port Arthur, over all lines of railway now or hereafter constructed by any company subject to the jurisdiction of parliament.


[Stage Direction]
Amendment agreed to.
George Newcombe Gordon: The second amendment is to insert, afteT the word "thereto," in the sixth line, in order to follow the amendment in paragraph 3, the words "within the territory."


[Stage Direction]
Amendment agreed to.
Thomas Alexander Crerar: Before we -pass to section
4, I wish to move an amendment, to add a new subsection t*o section 3. I beg to move:
That section 3 be amended by adding as subsection 7 the following:
"In any rates or tariff of rates fixed or approved by the board, rates in the territory lying west of Fort Wiliam in the province of Ontario, and east of the Rocky mountains, shall not exceed by more than ten per cent the rates or tariff of rates fixed or approved for the same commodities in the territory lying east of Sudbury in the province of Ontario, but nothing herein contained shall 'be taken to imply that rates in one territory are to be higher than rates in any other territory."
In order to give the committee the reasons that have induced me to move this amendment, it is necessary to traverse the history of the Crowsnest agreement, and I shaT do

Railway Freight Rates
so as briefly as possible. This Crowsnest pass agreement, as every member of the committee is aware, was placed on the statute books of Canada in 1897. It remained there undisturbed until conditions produced by the war made necessary a suspension of the application of the rates under that agreement, and I am free to say, sir-and I think I am well within the judgment of every member of the committee-that if the war had not occurred, we would have had no discussion as far as abrogation of the Crowsnest agreement and its application to western rates is concerned. The agreement was in the nature of a contract made with the Canadian Pacific Railway. A good deal has been heard in the discussion whcih has taken place in the chamber in the last few days upon the sanctity of contracts. I do not wish to deal with that phase of the question at any length.
I may, however, be permitted to observe that when the Canadian Pacific Railway was issued a charter in 18S1, it had a definite contract, for instance, with the Canadian government, and the Canadian people through the government, in respect of the matter of taxation, and that contract was consistently lived up to by the Canadian people, although in western Canada it imposed serious hardships and burdens upon many sections of the community. I do not wish, however* .to argue on the matter of the contract. The purpose of the contract was not alone to give a subsidy for the building of the Crowsnest pass railway. That 'opportunity whs taken by the government of the day to establish a principle in respect of western rates. The reason for the establishment of that principle is clearly evident. The whole question of freight rates in Canada is complicated and made difficult by the geographical character of the country. We have really in Canada, in the main, two separate communities. We have an eastern community, the eastern section of the country that lies east of the Great Lakes, and the western section of Canada lying west of those Great Lakes. Separating the two is a thousand miles of wilderness which, as I have stated before ton other occasions, is the most significant political fact in Canada to-day. I may interject here that, in my judgment, the greatest task of statesmanship in Canada at this time is to reconcile the diverging interests of those two sections of our country.
The principle that was sought to be established when the Crowsnest pass agreement was given effect to was to afford a measure of protection to western Canada in the matter 285i
of freight rates. In eastern Canada freight rates are governed by water competition. They are at times governed by American rail competition. An instance of this is the grain rates from bay ports to Montreal and St. John. These rates naturally are influenced by the corresponding rates from Buffalo to ports like Philadelphia and New York. Consequently, American rail competition does, within certain limits, affect Canadian eastern rates. But the big factor governing railway rates in eastern Canada, as I stated a moment ago, is water competition. That fact is not denied, and it has not been denied in this debate. In fact, it was admitted in judgments of the railway commission several years ago, particularly in the case that, if my memory serves me aright, was known as the Eastern Rates case. What does this mean? It means a definite limitation on the rail rates that may be established in eastern Canada. That fact, let me repeat for the information of the committee, has governed the railway commission at all times in its consideration of rates.
With that fact I want the committee to couple the next fact which is this. It has been admitted, and it has not been challenged so far in this debate, that the railways must be permitted rates that will enable them to operate. No one will quarrel with that assertion. I may say however, in passing, that even that statement requires some qualification. It requires qualification in this respect, that the country cannot afford to establish rates that will give the railways the necessary returns unless those railways are efficiently and economically managed. Consequently, the factor of economy and efficiency in management enters into the consideration of the question. But, by and large, the position has been taken by successive chairmen of the Board of Railway Commissioners and indeed, by the commission throughout in dts various hearings, and it has been generally recognized amongst the public and not been questioned, that the railways must be permitted rates that will enable them to function and that will give them a reasonable return on their investment.
Hitherto, in all the rate -cases that have been heard in Canada in the last twenty-five years, and particularly in the last ten years, the Canadian Pacific railway has been taken as the basis upon which rates should be fixed, for a very good reason. Everyone recognizes that if rates were established on a basis to enable the Canadian National Railways, ox the various railways that enter into the Can-
Railway Freight Rates

adian 'National railway system to pay all their operating costs and to look after their fixed charges, those rates would have ito be made very much higher than they are to-day, and such rates would enable the Canadian Pacific to earn far and away beyond what it is justly entitled to earn. Therefore, the Canadian Pacific has been taken as the basis for the establishment of rates. Right here., I wish to dissent from the argument advanced in this discussion iby some members oif the committee that it is necessary to establish rates to enable the Canadian National Railways to pay. The argument has been advanced that rates must be established to reduce the deficits on the Canadian National Railways. I submit that on the present capitalisation, of the Canadian National Railways, that cannot be done; that is to say, rates cannot foe established for the National Railways to-day, that will enable it to pay operating costs and fixed 'charges as well. That argument is not a sound argument, and it 'has never been recognized as a sound position .by the railway commission in any cases that have been heard before them.
What then is the bearing of all this on western Canada? The prairie provinces have no natural .competition in rates. I have pointed out to the committee the competition .that exists and the control exercised over rates in eastern Canada by virtue of water competition. There is no water competition in western Canada. Consequently, rates in western Canada from the very day western Canada was opened up, have been higher and, in many cases, much higher than they have been in eastern Canada, and they are much higher -to-day. The Crowsnest pass agreement specifies rates on certain commodities westbound. If you take those rates to-day on all those commodities, even t'he Crowsnest pass rates, they are higher in almost all similar instances than rates in eastern Canada. Where then is the argument that the Crowsnest pass agreement constitutes a discrimination against eastern Canada in favour of western Canada? It does not exist. I do not need to give the figures because .they have already been placed on Hansard iby some hon. members around me who have preceded me in this discussion. But I repeat, that situation obtains today. No matter what may be said in respect of the cancellation of 'this portion of the agreement that applies to westbound Tates, any man in his senses in this House or out of it knows there will be only one result, and that is that rates on those commodities westbound will be increased. The traditional policy of the Liberal party for over twenty-five years in Canada was formulated in (the Crowsnest pass

agreement and the purpose of that agreement was to give a governing control over those rates in western Canada through establishing statutory maxima that could not be exceeded. It was the policy of the Conservative party when 'they were in power in this country subsequently to the establishment of those rates under the agreement of 1897. I repeat, that would be the policy of Canada to-day, were we not in a position where the railways admittedly a>re in 'difficulty in securing the necessary revenues to keep them going and, consequently, are seeking relief through the abrogation of those westbound rates; and the abrogation of those rates under this legislation will result almost immediately in an increase in them to western Canada.
Now, let me say in all fairness that the position of western Canada is not understood in the east. Let me ask hon. members to go with me for a moment to the prairies; take the provinces of Manitoba and Saskatchewan. And what I am about to say is even more true of these two provinces than of Alberta. What is our situation geographically? We are 3,000 miles from the ocean if we travel eastward; and we are almost a thousand miles, indeed, parts of Manitoba are considerably more than a thousand miles from the Pacific ocean. We are producing commodities that must find their outlet to the markets of the world through either one of these oceans. Everything that we buy we import from outside, most of it from eastern Canada, and consequently the question of freight rates is one of vital importance to the people of these provinces. There has been much criticism in eastern Caifeda of the desire of the prairie provinces, of Manitoba and Saskatchewan particularly, for the building of the Hudson Bay railway. The Hudson Bay railway may be a dream; the Hudson Bay railway might not function if it were built. I am not going to discuss that question at the moment. But I wish to draw to the attention of the committee this fact, that the pressure of opinion behind the Hudson Bay railway is simply a manifestation of the aspiration of the people of these provinces to have a ready and quick outlet to the sea. That is the idea behind the Hudson Bay railway project, and surely you cannot quarrel with the position taken by these provinces in that regard, and even by the province of Alberta, further west. The position taken by the railway commission repeatedly has been that the railways must be given sufficient revenues in order to function. How does the situation appear to the western Canadian? And I ask my hon. friends from

Railway Freight Rates
Quebec and the Maritime provinces to transplant themselves for a moment to the prairies of western Canada. I am addressing myself particularly to my good friend the Minister of Justice (Mr. Lapointe), for whom I have the highest esteem. [DOT] Let him picture himself on a farm out in Saskatchewan or practising law in a Saskatchewan town, or carrying on business in any enterprise whatever; and let him endeavour to look at the question through those spectacles. It is not denied that eastern rates are governed by water competition. Now, if the costs of railway operation go up, as they have been going up, where are the railways to get the necesary revenues to function? The leader of the opposition (Mr. Meighen) the other day enunciated a new policy for Canada, and that policy would certainly mean higher costs of living to railway working men. If the policy advocated in some quarters on both sides of the House is adopted in respect of the importation of coal and steel it will increase the cost of operation to the railways and sooner or later we shall be faced with the demand for a further increase in rates. Where are the railways going to get that increase in rates? If the prairie provinces are left without any protecting maximum in rates, the railways will make up the increase in those provinces, because there is nowhere else to get it. Whether that is right or wrong, let me in all earnestness say to the committee that that is the view of nine out of ten men in Manitoba, Saskatchewan and Alberta to-day, I care not what may be their religion or their politics or their calling.
We have no controlling maximum when this legislation is passed except in regard to grain and flour; and I want to say something respecting grain and flour. The impression has been left on the committee that these rates are not profitable. Now, I have as great an esteem for my hon. friend from North Waterloo (Mr. Euler) as I have for anyone in this House; but the hon. gentleman last night quoted figures which he said had been supplied by the statistical department of the Canadian National Railways and which I positively and absolutely decline to accept. And let m,e tell you why. In rate cases the Canadian National Railways, so far as I know, have never presented figures showing costs of operation, and income received from their western lines, but the Canadian Pacific Railway has supplied such figures. My hon. friend from West York (Sir Henry Drayton) stated last night in the debate that the grain rates even on the Canadian Pacific railway to-day were not
profitable. My hon. friend is entirely mistaken. In the statements furnished by the Canadian Pacific Railway in the rates case of 1923 there was given a table showing the net earnings east and west, this statement being supplied at the request of counsel for the prairie provinces. I would ask the committee to bear with me while I read it, and to bear in mind that the crop movement in western Canada takes place in the months of August, September, October, November and December. During these months the greater bulk of the grain goes to market. The net earnings of the Canadian Pacific Railway for the year 1922. I believe, on lines both west and east, that is to say, east of Fort William, were as follows:
Month	Lines East Lines West
January	$ 620.784 94	$ 466,104 37February	
898,498	96	372,504	36March	
1,766,989	35	1,094,105	12April	
1,415.683	77	1,669,001	77May	
1,796,690	39	1,980,023	02
You will notice there that the earnings in the west in the last two months exceeded those in eastern Canada. Why? Because, after the opening of navigation, the remaining crop was moving to the head of the lakes.


Mr. EULER:: Are those operating earnings?


Thomas Alexander Crerar: They are net earnings. I would direct the attention of the committee particularly to the later months, from August on. I want the Minister of Railways (Mr. Graham) to note this, because it must have escaped his attention.


George Perry Graham: It has no bearing on the
amendment.


Thomas Alexander Crerar: It has, as I will show.
Mr. MANION. Whose figures are those?


Thomas Alexander Crerar: They were furnished by
the Canadian Pacific Railway at the request of counsel for the western provinces, given under oath; and are as follows:
Month	Lines East Lines West
June	
$1,450,143	92	$1,953,112	60July	
530,249	46	1,792,659	61August	
787,620	07	2,504,033	40September	
1,013,552	56	3,734,968	01October	
822,931	95	6,339,980	52November	
4,403	91	5,048,111	03December	
566,652	41	3,170,787	84
Those are the actual figures supplied by the Canadian Pacific Railway on this occasion.


Mr. FORKE:: Have you the total figures?


Thomas Alexander Crerar: The total earnings on
eastern lines were $11,674,000; on western lines, $30,026,000. It will be observed that the months in which those heavy earnings took place were the months when the grain
Railway Freight Rates
COMMONS moved most freely from the prairies to the head of the lakes. Ini the face of that, for my hon. friend from West York (Sir Henry Drayton), or even my hon. friend from North Waterloo (Mr. Euler), to state that these rates are not profitable is to me impossible to understand. But I will quote other evidence. Surely the president of the Canadian Pacific Railway has as good an understanding of this matter as any hon. member in this House. In the annual report to the shareholders of his company recently distributed, he attributes the decrease in their earnings to the shortage in the grain crop. He says:
The decrease in freight earnings is largely accounted for by the much smaller movement of grain and flour, particularly the former, owing to the smaller crop in western Canada.
Now, if they were hauling this grain at a loss, how could the president of the Canadian Pacific insert such a statement in the annual report of his company? In other words, if the grain was hauled at a loss, he should rather be congratulating himself that the crop was smaller and his loss thus reduced. But in speaking at the annual meeting of the company, as reported in the Montreal Gazette of May 7, 1925, Mr. Beatty, in forecasting the prospects for the present year, used these words:
If a good crop is garnered in this year, particularly in western Canada, we have cause for confidence that the result of the year's operations will be reasonably satisfactory.
Those are Mr. Beatty's words to his shareholders. The conditions of operation of the Canadian Pacific and the Canadian National railways in western Canada are so similar that for the reasons I have given I decline to accept the figures provided by the statistical department of the Canadian National Railways. Reference has been made to the fact that our grain rates in western Canada are much lower than those in the United States. That is true; no one denies it. The basis of rates in the United States is different from what it is in Canada, because the United States law governing the Interstate Commerce Commission permits differentials. Under our law such differentials are not supposed to exist unless there is undue competition. But there is another factor. The grain haulage in the states contiguous to the Canadian boundary is probably considerably less than half the distance of the grain haulage in western Canada. And I would direct the attention of the committee to this fact, that there is no freight moved with so little expense to the railways as is grain in bulk. All the railway company do is to put a car to an ele-[Mr. Crerar.J
vator-indeed very often they do not fix up the car-the car is loaded with grain by the elevator company, the railway agent seals the doors, the car starts on its journey to the terminals, and when it gets there the switchman shunts it to the elevator.


Mr. MACDONALD (Pictou):: And it goes back empty.


Thomas Alexander Crerar: That is true. I would
point out to my hon. friend the Minister of National Defence that all these cars went back empty when the Canadian Pacific were earning the profits on grain haulage that I mentioned a moment ago. Furthermore, those full trainloads of grain are made up at prairie points and carried through without any switching at sidings, or anything else. Consequently from the very nature of the traffic, grain is a commodity that moves cheaply, and the present rates that are fixed in this bill are, I submit, profitable rates, to the railway companies.
Now, I do think that the government in providing that the Crowsnest pass rates on grain shall not be exceeded have done a very wise piece of work. I admit the difficulties of the government's position. I know the government must be responsible to public opinion throughout the country. I know that public opinion in eastern Canada-I think wrongly, but I do not wish to be unjust-has held the view that the west were securing favours under this agreement, and that it should be wiped out. I repeat, I appreciate the difficulties of the government,-and also the difficulties of my hon. friends to my right-in dealing with the prevailing view of public opinion in thi3 part of the Dominion. But, on the other hand, you have just as strong a public opinion in the prairie provinces that the Crowsnest pass rates are fair rates as you have in eastern Canada that they are unfair, and we poor mortals in this House of Commons have somehow to compromise those conflicting views and arrive at something that is fairly satisfactory to all concerned.
I agree in considerable measure with the argument advanced by the right hon. leader of the opposition (Mr. Meighen) yesterday in respect to the contractual obligation under the Crowsnest pass arrangement. It is true that that agreement was in the nature of a contract with the Canadian Pacific Railway. There is no one in this House or out of it who, in his senses, would deny that the two parties to that agreement can abrogate or change it when they mutually agree to do so~ No one can quarrel with that position, it is beyond question. But I do think my right

Railway Freight Rates
hon. friend overlooked this point-although in a later part of his speech he seemed to be cognizant of its importance-that the Crows-nest pass agreement was not solely in the nature of a contract conferring a favour. In fact, no special privilege was conferred by it at all. It was a form of protection with respect to freight rates to an area of country that had no other protection whatsoever. Consequently it cannot be designated as something in the nature of special privilege; it gave nothing to that section at the expense of any other portion of Canada. But I admit the difficulties of the situation. The government have announced their policy in the order in council which they promulgated a short time ago containing the instructions given to the railway commission to investigate the whole rate problem in Canada and suggest a rate structure that will be fair and equal to all; in other words, the principle of equalization is to apply in the creation of those tariffs.
Now, Mr. Chairman, I submit that the statement that rates will or can be equalized is misleading. You cannot have a complete equalization of rates in a country constituted geographically as Canada is; but you can approximate to an equal scale of rates, and that is what I desire to see embodied in the law by the amendment that I have proposed. I am willing to agree with the position taken yesterday by my right hon. friend the leader of the opposition in his criticism of the agreement if he goes further, as he intimated he might, and takes into consideration a statutory limitation to the railway commission in the fixing of rates. It is not the function of parliament to fix freight rates. I agree with that at once. If we started to create a rate structure, and undertook to finish our job, there would not be any general election this year. There is nothing surer than that. But it is a thoroughly sound practice-and I agree entirely with my hon. friend who leads the opposition in this respect,

that parliament cam lay down the principle upon which the rates shall be based. That is what I seek to do in the amendment which I have submitted to the consideration of the committee.


Leon Johnson Ladner: Does the hon. gentleman's amendment cover the territory of British Columbia?


Thomas Alexander Crerar: No it does not, and if my hon. and good friend will have a moment's patience I will explain why. The purpose of the amendment is to embody in the statutes the broad principle of equalization which the
Prime Minister has announced as the policy of the government, and which I accept because I do not wish now to question the good faith of the government or any member of it in that particular for a moment; it is the principle which has animated the government in the instructions given to the railway commission in the order in council. It is also the principle which my right hon. friend (Mr. Meighen) yesterday afternoon stated was a principle that could be admitted, at any rate for discussion. Now, I seek by the amendment to incorporate in the law that principle. And what is it? Not that generally speaking the rates in the prairie provinces shall be equal to those in eastern Canada, but that they shall not exceed by more than ten per cent the tariffs of rates fixed for the same commodities in the territory lying east of Sudbury.


An hon. MEMBER:: East of where?


Thomas Alexander Crerar: East of Sudbury, because I might add, I do not think it is denied by those who have studied the question, that rail rates from Sudbury right down to the Atlantic are governed by water competition. Let me repeat: the amendment seeks to establish the principle that in the prairie provinces lying west of Fort William the rates shall not exceed by more than ten per cent the rates in eastern Canada for a similar commodity.


Leon Johnson Ladner: Wh}r not apply it to British Columbia?
Mr. CRERAR My hon. friend is very impatient. That I submit is a reasonable proposition. It is not throwing on parliament the burden of fixing railway rates; it takes the whole thing out of the realm of parliament except insofar as the grain rates are concerned, and the grain rates should stand because beyond question they are among the most profitable rates the railways have. Let me repeat: It takes the matter of freight rates out of the hands of parliament, and deals with the issue in a broad way with instructions to the railway commission to guide them in their consideration of the matter.
My hon. friend from Vancouver South (Mr. Ladner) asks "Why is British Columbia not included"? Because the conditions of operation in British Columbia are wholly different from what they are on the prairies.


Leon Johnson Ladner: In what respect?


Thomas Alexander Crerar: The costs of operation in British Columbia are higher than they are on the prairies.


Some hon. MEMBERS:: No.
Railway Freight Rates


Thomas Alexander Crerar: Well I am possibly getting at cross purposes with some of my British Columbia friends. I grant the objection may apply as far as the Canadian National railway down to Vancouver is concerned.


Leon Johnson Ladner: Would that interfere with the principle of fixing the maximum rates? Even if you enter into the question of the cost of operation the principle would still remain.


Thomas Alexander Crerar: The haulage of goods, for instance over the Canadian Pacific main line from Calgary to Vancouver is vastly a more costly operation than it is on the prairies.


Leon Johnson Ladner: But how would fhat interfere with the principle of fixing maximum rates.


Thomas Alexander Crerar: If you adopted a maximum of ten per cent and applied it to British Columbia the railways might be compelled to operate at a loss and I do not wish them to do that. It would not be fair to the prairies to put the prairie operation on a parity with mountain operation for the reason that the former is admitted to be the cheapest operation there is in Canada. That is a view which has never been assailed.


Arthur Meighen: If parliament should
remove the physical disability of lake or water competition, should not parliament also remove the physical disability on an ordinary road?


Thomas Alexander Crerar: I do not know that I quite get the point of my hon. friend's question.


Arthur Meighen: The hon. member says that because the west has no water competition parliament should come to its rescue and remove that physical disability by fixing rates, say, on grain and flour. If we remove a physical disability for the prairies why should we not remove the corresponding one over the mountain section going into British Columbia?


Thomas Alexander Crerar: I do not wish to get into a discussion of the rates of British Columbia. Let me say, however, that those rates are governed in a measure by rail transportation and water competition. For instance, it is a fact, which my British Columbia friends will admit, that to-day goods are going from eastern Canada to Vancouver through the Panama canal. I am told that goods have been moved from Toronto and Hamilton to New York by rail, there loaded on a vessel, carried around through the Panama canal, and delivered in Vancouver, and that fact

exercises an influence on the rail rate from Toronto and Hamilton to Vancouver.


Arthur Meighen: Just Vancouver?


Thomas Alexander Crerar: I said Vancouver.
Mr. MEIGHEN' What about the Yale valley?


Thomas Alexander Crerar: However, I am submitting this amendment as containing a definite principle which I think should be applied.


Arthur Meighen: Would the hon. member be willing that this principle should apply to grain and flour as well as anything else?


Thomas Alexander Crerar: No I would not. I anticipated that question from my right hon. friend, and I say that I would not because the rates established to-day on grain and flour, under the legislation which the House is considering, are profitable rates. Now, out in that western country you have the farmer three thousand miles from the Atlantic ocean. He must transport his products over that immense distance, and must sell his grain and live stock in open competition with the world. My right hon. friend wishes to put further shackles upon him by tariff increases and raise the cost of everything he requires in order to carry on that production. Then on top of that, I presume, he would give him further encouragement by increasing the rates on grain and flour. However, that is aside from the question. I submit that the principle embodied in this amendment is a sound principle, and I commend it to the consideration of the committee.


Leon Johnson Ladner: I asked why not extend the principle of maximum rates on grain and flour to the port of Vancouver, and through that route, as well as to eastward points? Will the hon. gentleman deal with that question.


Thomas Alexander Crerar: I did not understand my hon. friend to ask that question, but I am wholly with him on that. At the same time I admit the difficulties which exist in incorporating in a statute many special agreements in respect to rates. I am not a lawyer but if I understand correctly the amendment was passed immediately prior to the one I am moving, it gives the people of Alberta and the people of British Columbia a case upon which to ask for a reduction in western rates on grain and flour.


Leon Johnson Ladner: Ask the board?


Thomas Alexander Crerar: Surely, and they are obliged to act without discrimination.

Railway Freight Rates


Leon Johnson Ladner: Why not include that in the hon. gentleman's amendment?


Thomas Alexander Crerar: Because my amendment is dealing with a separate thing altogether. I trust my hon. friend will see that.
I do not wish to take uip further the time of the committee. Everyone who sits down seriously and honestly to face the question of freight rates in Canada recognizes the difficulties which surround us. I think I understand and I appreciate the opinion that exists in eastern Canada. I think it is a mistaken impression-and I am afraid widespread-that the rates which we have enjoyed under the Crowsnest pass agreement were discriminatory rates in favour of western Canada. I repeat they were not discriminatory rates in favour of western Canada. They simply, for a long period of years lessened the disability in the shape of the existing freight rates under which western Canada grew up and developed. Let me remind the committee again that the very tenacious adhesion in western Canada to the Crowsnest pass agreement is not based on a desire for special favours from this parliament. It rests upon the fear that if these controlling maxima are removed, when the railway companies require an increase in rates to meet their costs of operation, western Canada will have to pay the shot. That is the reason for the intense feeling that prevails to-day in the western provinces in regard to this matter. I am here as a member of this House; I want to take an all-Canadian view of this question. I want to try and work out something that will be mutually satisfactory to east and west, for heaven knows the problems of this country are great enough and difficult enough without having sectional strife engendered through matters of this kind, and for that reason I submit to the committee and to the government the wisdom of adopting the amendment that I have moved.


Henry Lumley Drayton: My hon. friend has succeeded in doing one thing, doubtless to his own satisfaction. He has succeeded in showing there is absolutely no reason for the continuance of the Crowsnest pass agreement. The only object and reason that there can be urged for the maintenance of the Crowsnest pass agreement is that if that agreement is taken away rates will go up. He has shown to his satisfaction that, on the contrary, grain and flour rates are highly productive. My hon. friend, if he believes in his figures, will turn around now and say: We do not need the Crowsnest Pass Act.


Thomas Alexander Crerar: By what stretch of the
imagination can my hon. friend reason like that?


Henry Lumley Drayton: I am simply reasoning on commonsense. I am for the moment taking my hon. friend as stating something he believes in. Everybody knows that remunerative rates cannot be raised. Rates have to be maintained at a just -and reasonable level, and if there be the millions in this grain 'business that my hon. friend says, he is quite safe in letting the Crowsnest pass agreement go. But he knows very well that the fact is not as he says. Why, Mr. Chairman, I can take the figures of the National railways and I can make just the same sort of showing with them that my horn, friend makes in connection with the Canadian Pacific. Those figures over those months, as anyone that knows anything about the business knows are illusory. What happens in connection with the grain movement?-and I will take the Canadian Pacific net figures per mile in eastern Canada and in western Canada, What happens? We will take the evidence of Sir Henry Thornton given before the Railway committee this year, and not only this year but in other years. We will take the evidence submitted in case after case. Now what has got to be done? We have in connection with the western grain crop movement a tremendous volume, for which very, very great preparations have to be made. We also have something, as a result of that movement which my hon. friend ought to know; his counsel that drafted that resolution ought to have been fair enough to tell him that as a result of the weight of that movement, practically all the cost of maintenance, betterments and all that sort of thing, has to be met in western Canada before that movement commences. It is all done beforehand. Why, in connection with the autumn months of the year in western Canada it is practically all net outside of the exact cost of transportation. The road work is finished; it has to be, for there is an intense active movement which will not permit of road work going on at the same time.


Thomas Alexander Crerar: That does not affect the totals of the net earnings I gave east and west.


Henry Lumley Drayton: I am not going to quarrel about earnings east and west, because there is no issue about that. Goodness gracious, when you have a far greater mileage in the west, you must have far greater earnings.
Railway Freight Rates


Mr.   McM ASTER@: Or far greater losses.


Henry Lumley Drayton: Or far greater
losses, as the case might be; the hon. gentleman is quite right. But what my hon. friend has argued is that these grain and flour rates are highly remunerative. I will admit this at once: The bulk of the tonnage on the Canadian Pacific Railway moves from a territory which is more contiguous to Fort William than the bulk of the tonnage on the Canadian National. The result, of course, is simply this: Every hon. gentleman, that comes from the west and takes a real interest in this question, and not merely a political interest which leads him to talk about the west being shackled and other kinds of nonsense, knows this, that as we go to the longer mileage the rate comes down. We have the tapering going on, and while you can taper rates to advantage with greater profits to the company, provided your original base rate is right, if your base rate is too low, if you taper it too far, there is loss instead of profit. As a matter of fact-I am speaking now from memory-while the average rate of grain on the National is .52 per ton per mile approximately, the average rate on the Canadian Pacific is more like .58 per ton per mile owing to the shorter distance and to the fact that the scaling down has not been made. Under those circumstances the Canadian Pacific can make, and do make, a better showing than can the National in connection with grain and flour. .
Now the next point which anyone who is at all fair in connection with this matter must consider is what the cost of the grain movement is, and I considered that when I gave the answer I did the other day. When I talk about a profitable movement I mean a movement yielding a real profit. One of the great factors of cost in connection with the grain movement is the collection and assemblage and carriage of an immense number of empty freight cars from all over the continent to western Canada. Those cars are carried sometimes from the Maritimes, as far as that; I have made them carry them for that length myself in order to see that the western grain crop was moved. I wonder if hon. gentlemen have any idea what that cost means. I wonder if they have ever considered it. Those figures given by my hon. friend pay absolutely no attention to that cost at all, not the slightest. The whole of the cost of getting ready for that grain movement, and it amounts to a tremendous sum of money, through eastern territory is all charged up to eastern territory, and the east practically does not get one
	.
single sou out of it. One of the reasons for a higher operating cost in eastern territory is that the eastern territory has to look after supplying all these cars for the west.


Mr. BANCROFT:: How do these cars
come to be there? Would they not be full cars when they go there, and would not that be credited to eastern territory?


Henry Lumley Drayton: In the first instance, the very great volume of western business is grain and flour. That does not last very many months in the year. Freight cars are worth something. If they are allowed to stand idle the investment is entirely idle. They have to be moved where there is business to be done, and they are taken to where there is business to do. When that business is done, they have to be taken back.


Robert Forke: Has the hon. member ever
seen an empty freight car going east? I never heard of one.


Henry Lumley Drayton: My hon. friend is wrong about that. There are some that go east.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.


Henry Lumley Drayton: When the committee rose at six o'clock I was discussing the movement of empty freight cars, and I think the hon. member for Brandon was about to ask me a question. Perhaps he will repeat it.


Robert Forke: I only asked the ex-Minister of Finance if he ever saw a train load or half a train load of empty cars going east?


Henry Lumley Drayton: In what territory?


Robert Forke: From the west.


Henry Lumley Drayton: My hon. friend
means in western territory. There is no question that his point is perfectly well taken. The burden of the empty car movement is not on the west but on the east. My hon. friend is quite right when he says he does not see any empty cars going from western Canada. Why, the waste of money occurs in getting cars from eastern Canada out west. My hon. friend from Marquette (Mr. Crerar) in giving his figures did not take into consideration any of these important factors. I was not in the House when my hon. friend gave his figures, but I have been told that he took the year 1923. He used Canadian Pacific

Railway Freight Rates
Railway figures, and I may say that in 1923 there was collected in eastern territory, Ontario, Quebec and even the Maritime provinces, 23.000 cars for the purpose of looking after the western business. Of course that is something which has to be done iby the east entirely at its own expense.


Mr. STEWART (Humboldt):: Admitting
my hon. friend is right in his figures that there is a movement of empty cars westward, will he not agree that the higher the freight rate on the commodities moving to the west, the more empty cars will go that way?


Henry Lumley Drayton: The best way of remedying empty car movement would be a higher tariff on importations from the south, which my hon. friends to my left are so fond of engaging in, instead of using their railways. As it stands at present the figures are 23,000 cars for the year 1923.


Thomas Alexander Crerar: At what season of the year are they moved west?


Henry Lumley Drayton: In time to look after the crop. When I was on the railway board I used to start prodding up the railway companies early in May for the purpose of making sure that the empty cars would be moved west in time to look after the grain crop. Using round figures, in 1923 23,000 cars were moved from eastern territory, and the cost of moving every single one of those cars was charged to the east.


Thomas Alexander Crerar: How did those cars get
to eastern Canada? They carried freight of course.


Henry Lumley Drayton: My hon. friend is rather incorrect in his assumption. In connection with the movement of that grain crop looked after by these cars, which my hon. friend ought to know something about, approximately only six per cent is moved by railway cars in eastern territory. That may be news to him, but it is the sad fact that anybody who has anything to do with railway rates in eastern territory knows. In other words, eastern territory pays the whole cost of getting those cars there, and only enjoys six per cent of a haul out of that whole movement, and yet it is all charged to the east. Has my hon. friend any idea about overheads in business? Is it possible to get him to understand that? I wonder if it is possible to get him to realize that in connection with the overhead of a business which goes on for twelve months in the year, you have a twelfth of the overhead to be looked after
month by month, and if you have a business that is practically all peak and a business which is confined to a comparatively short period, the overheads are infinitely greater. Does my hon. friend understand that? He loses all sight of that, and pays not the slightest attention to it, any more than he pays attention to the amount of money that is spent in preparation for that movement before the movement commences, but which is just as chargeable in expense to that movement as is the coal used in the engine itself. ,Of course these considerations have to be lost sight of when we can get hold of a few characteristic figures, really meaning nothing, but making first rate material for a political speech.


Robert Forke: A great piece of bluff.


Henry Lumley Drayton: I did not quite catch what my hon. friend said. I want to do him justice. Would he repeat it.


Robert Forke: I said it was a great piece
of bluff.


Henry Lumley Drayton: I am afraid I
cannot pay much tribute to my hon. friend from Brandon.


Robert Forke: To his intelligence?


Henry Lumley Drayton: I would not say to his intelligence, but to his capacity to deal fairly with a question which really requires fair treatment and which should not be treated from a sectional point of view. I should like to know whether he thinks, for example, that it is unfair to say that overhead has something to do with the length of time that is occupied. Would he say that? I do not think that is a point which I have been making. Would he say that it is unfair to charge the work necesary to be done for a given movement months before that movement takes place, to that movement? If he does, that just indicates the extent to which my hon. friend is prepared to go in looking at this question from a sectional standpoint. We have also, in connection with the grain movement, the peak that I speak of and, besides that, we have in western territory something which the hon. member for Marquette (Mr. Crerar) conveniently forgets about. We have at the same time the peak in the coal movement in that territory. Of course, it is all put down to wheat and flour when that is convenient; but the fact is that in western Canada we have two peaks occurring at the same time, and peaks, as any hon. gentleman knows who has any business experience, mean expense. The Canadian
Railway Freight Rates

Pacific Railway Company, the Canadian National Railways have to have on hand enough rolling stock to look after those peaks. The complete total of rolling stock in this country is by no means used all the year round. I would give the hon. member for Marquette credit for knowing that fact, but he does not give any appreciation to it in connection with the use which he makes of these figures. We have locomotives greased up during certain portions of the year.


Mr. HOEY:: I think the hon. member is
attempting to be fair. Will he comment just for a moment or two on President Beatty's statement with respect to the western crop as quoted by the hon. member for Marquette? President Beatty said:
If a good crop is garnered this year, particularly in western Canada, we have cause for confidence that the results of the year's operations will be reasonably satisfactory.


Henry Lumley Drayton: I agree with my hon. friend absolutely. Until we had the figures from my hon. friend and the deductions from them, I was saying, what I still believe, that the most important thing in connection with public business in this country and our economic welfare is the movement of our grain crop.


Robert Alexander Hoey: Then the railways are not
carrying the grain at a loss.


Henry Lumley Drayton: My hon. friend is a little rash in jumping too early to that conclusion. Activities in any line upon any part of the system, which add to the buying power of the prairies, which create the buying power of the prairies, make and mean business all along the line. As I pointed out before, the position of the Canadian Pacific as a result of the shorter mileage is certainly very much better than that of the Canadian National Railways. There is no question about that. I pointed out that the average grain earnings per ton mile on the Canadian Pacific are more like .58 as against .52 on the Canadian National and that, of course, means a great deal more money for the Canadian Pacific.
Let us see what the proposition is that my hon. friend wants. Irrespective of volume, irrespective of public necessity, irrespective of all business conditions, yes, irrespective of the very life of the districts themselves, he wants to apply an arbitrary rule giving a variation of 10 per cent. I suppose what is sauce for the goose is sauce for the gander. If at the same time grain and flour rates in the west were brought up to a point within 10 per cent of grain and flour rates in the east, and that

was put into effect and the western people knew it was put into effect as a result of the agitation of my hon. friend, the west would not be a safe place for him a year after that was done. It would be an absolutely dangerous place for him, because if anything could be done to ruin the west, it would be simply the adoption of what my hon. friend was pleading for this afternoon, applying it honestly and fairly over the whole situation.


Thomas Alexander Crerar: I excepted flour and grain
rates.


Henry Lumley Drayton: Just take notice of the wonderful fairness of my hon. friend. He excepts the one thing which western Canada is entirely interested in and dependent upon.


Thomas Alexander Crerar: My hon. friend is not going to misrepresent me. I will tell him that right now.


Henry Lumley Drayton: Go ahead and
let us see where it is wrong.


Thomas Alexander Crerar: I stated that bulk grain
rates to-day in western Canada are amongst the most profitable rates the railway companies have, and the evidence proves that. That is the case on the existing scale of rates and it should not be increased.


Henry Lumley Drayton: My hon. friend is interrupting now for the sake of interruption. He has said absolutely nothing which contradicts a single word I said. The grain movement is the heavy movement in western Canada. It is the one movement in which the rates are low and he says:	Of course, I
except that, but in connection with all other movements we want to come to your rate with the exception of 10 per cent. I am going to deal with the question of business and its percentages in regard to the different territories. It is exceedingly difficult fairly to segregate the result of any section of the railways, because all parts are interdependent and interrelated one on the other. But the traffic can be segregated. I will take the figures again for 1923 which are as follows:
Western lines Eastern lines tonnage	tonnage
per cent	per cent
Grain movement	
55.9	17.4Forest products	
8.7	10.05Coal	
11.4	11.8Ores	
2.5	1.0Manufactured goods.. ..	20.0	56.4
In other words, the situation is this. In western territory practically eighty per cent of the traffic of western lines is carried at low class commodity rates. That is why the west is getting off so much more cheaply than the

Railway Freight Rates
east in connection with what it is actually paying. In other words, the freight schedule to-day that my hon. friend is attacking is a freight schedule which is looking after eighty per cent of western activities and looking after it so well that much less money is being taken out of the west than is being taken out of the east for the actual service rendered. As against that eighty per cent in the western territory, in the eastern territory the same class of traffic amounts to 43.6 per cent. This is a pretty good illustration of the underlying necessity of railway rates, that is to look after our real business at low rates, the business that the district is actually interested in. Eighty per cent of the whole business of the west is carried on at a low rate, as the figures show. But my hon. friend, in connection with some paper traffic, does not hesitate to imperil the whole freight structure and the economic future of Canadian railways to the great injury of his own province.


Thomas Alexander Crerar: Will the hon. gentleman
be good enough to state his case over again? I must confess that to me it is about as intelligible as Einstein's theory of relativity.


Henry Lumley Drayton: I would expect that from my hon. friend; I see he does not know anything about the subject.


Thomas Alexander Crerar: Perhaps my hon. friend,
who knows all about it, will explain why the net earnings of the sj'stem in western Canada -came to $30,000,000 while in eastern Canada they totalled only $11,600,000.


Henry Lumley Drayton: We shall come
to that point.


Thomas Alexander Crerar: I was afraid you would
get away from it.


Henry Lumley Drayton: There is nothing in this that we want to get away from. Now, I desire to point out again, not to my hon. friend, because he would not understand it, but to the committee, the great degree in which there is a peak in western territory while the tonnage movement on the eastern lines varies but little from month to month. In the last four months of the year, when the grain crop is carried, 54.97 of the western traffic of 1923 was moved. I do not know whether my hon. friend thinks that the rates per ton per mile have anything to do with the Einstein theory that he cannot understand them, but I have already given the figures and if he wants any further light on the point I shall be glad to help him. But I take it that he does understand something about the matter. Now I will come to what
my hon. friend has in mind, namely, the total earnings; and I shall give them for two years. In 1923 the Canadian Pacific Railway operated in eastern territory 4,827 miles. And here I may explain that these are the results of the whole year when the costs are properly charged; they are not the first impression monthly statements at all. In western territory the Canadian Pacific Railway in the same year operated 8,259 miles. The earnings per mile of railway in the east were $17,893 as against $12,589 in the west. The expenses per mile of operation in the east in that year were $14,346 and in the west they were $9,069. The net per mile-the operating net and of course having nothing to do with fixed charges-was in the east $3,547 and in the west $3,520. These are the actual figures after the proper final calculations are made. If my hon. friend is not content to take the usual yardstick of ton per mile, I should like to know what his complaint is. Does he honestly think that he could get it any closer than a net per mile of $3,547 in eastern Canada and $3,520 in western Canada?


Arthur Meighen: Is allowance made there for the charges in the east in connection with the empty car collections?


Henry Lumley Drayton: No allowance is made for that. In 1924 the mileage operated in the east was somewhat greater, 4,896 miles, while in the west it was also greater, 8,465. The earnings per mile in the east in that year were $16,632 per mile and in the west $11,312. The expenses per mile in the east were $13,197 and in the west $8,085. Hon. gentlemen will remember that I told them when we were first discussing the matter, that we always had lower expenses in the west, and this demonstrates the truth of that statement. The net per mile in 1924 was $3,435 in the east and $3,227 in the west. These are the actual concrete results on the final auditing of the respective mileages of the system.


Mr.   IIOEY@: When you speak of the west
you include British 'Columbia?


Henry Lumley Drayton: Yes, that is
right. Now, my hon. friend (Mr. Crerar) is not to blame for the figures he presented to the House; counsel in that particular case had his own axe to grind and he prepared a particular statement which means very little. I was perfectly fair in pointing out that if my hon. friend really believes in his own figures he does not need any Crowsnest pass agreement at all. Rates that are remunerative cannot be raised because that would be unfair and unjust. But there is not a single western
Railway Freight Rates

member in the House who does not know that the Canadian wheat and flour rates are the lowest in the world.


Milton Neil Campbell: Is not the hon. gentleman aware that the rate on the Canadian Pacific Railway from Goderich to Maritime ports is considerably lower than the Crows-nest rate?


Henry Lumley Drayton: I do not know
that at all; I do know that so far as rates are concerned, the rate per ton per mile in the west is considerably lower than any I know of. If my hon. friend is able to find any considerable tonnage that moves in eastern territory at lower rates then he will quarrel seriously with the rate per ton figures showing the actual results as I have given them to the committee already, as being in eastern territory 1.173 as against .87 in western territory. All hon. members to my left who are members of the Railway committee know how the accounts are kept in the Canadian National and they know what the results are. If there is any truth whatever in this range of figures, why is it that the territory, the east, which it is said has such low rates is carrying the territory that has the high rates? The heavy tonnage was in the west all right. If there is the slightest economic truth behind the figures used by my hon. friend from Marquette why is it that in a year when central Canada produces a surplus of $22,000,000, the territory where we are told the rates are so high and the tonnage so great shows a loss of $2,200,000?


Robert Forke: You refer to the whole western territory right through to Prince Rupert, I suppose?


Henry Lumley Drayton: Certainly.


Robert Forke: Is it fair to do so?


Henry Lumley Drayton: I would have
thought so. Why not? We are told the rates are even more out of line in British Columbia. It is all very well for hon. gentlemen to my left to say, "We have to carry the Grand Trunk Pacific to Prince Rupert." But we have to carry the same sort of stuff in the " long bridge " and the Transcontinental. Do not think you have any monopoly of these burdens. In that western territory where, according to my hon. friend (Mr. Crerar), the rates are so high and the tonnage so great, in that particular year there is a deficit in connection with the National Railways of $2,200,000, while in central Canada we produced a surplus of $22,000,000. Mr. Chairman, the thing is ridiculous. And, what is more, it is entirely against the in-
terest of that western territoiy that such statements should be made. The worst thing that can happen to the western territory is to have its 80 per cent of traffic treated in the same way that it is treated in eastern Canada. Just see the fairness of this loaded proposition. Special rates for the heavy movement of western Canada; no! special rate for the heavy movement of central Canada They are to have their special privileges, but in so far as the rates are concerned where the tonnage is heavy in central Canada, where there are commodity rates, notwithstanding the fact that they are not much interested in that business and very little moves under it, they are to come within 10 per cent of the same basis.
Are these grain rates high? Very profitable? Just let us see, Mr. Chairman. I made reference to the application by the railway carriers in United States grain territory on the prairies to the south for an increase in rates. I want the House to realize what rates these railways seek to have so substantially increased. First let us take the short distances. For 420 miles out of Fort William the rates in Canada are 14 cents per hundred pounds; for 417 miles in the American territory they are 204 cents. Portage la Prairie with its mileage of 475 has a rate of 15 cents; a similar mileage in American territory has a rate of 23 cents. Carberry with its mileage of 525 has a rate of 16 cents; for the comparative mileage in United States territory the rate is 234 cents. I take these small mileages because the density of movement in the shorter hauls is greater in the States than it is with us. If we take the longer mileages in which we are so much interested, we find the Lethbridge rate is 25 cents, as against 48 cents for a similar mileage in the United States. That is the class of rates that these companies are seeking to have increased. Let us take another feature of rate structures. The average .rate in western territory was .87 cents on all traffic carried by the Canadian Pacific. The American companies are appealing to the Interstate Commerce Commission because they say they cannot get along with an average per ton revenue as high as 12.09 mills. Why, in 1921, one of their lean years, their revenue was 14.22 mills-nearly 14 cents-as against .87 cents. Yet they are saying they cannot get along with that revenue. Why? Because it is impossible to borrow money, their earnings being insufficient to attract investors. They are quarrelling with earnings which yield them a trifle under 4 per cent on their investment. They want to get

Railway Freight Rates
5| per cent on the actual cash investment in their property. Here, as I pointed out the other day, we have the Canadian Pacific on the actual cash invested in their property earning a little over 4.3 or 4.4 per cent. I am pointing out, Mr. Chairman, that this is a pretty good confirmation of the figures of the National Railways.
Now, I should like hon. gentlemen to my left to again consider this grain business. I gave an illustration the other day as to how quickly things can change in this connection. The statistics worked out by the statistical department which I gave to the House are much more refined than what I am now going to give, they are more correct because they eliminate charges which, in part, cannot fairly be charged to the grain movement less yardage and the like; those are deducted in connection with the five and six million dollar odd loss I gave to the House. I should like hon. gentlemen to do a little figuring on this themselves, and as apparently they did not quite understand them I want to give the figures again. These figures nearly approximate what we are doing ourselves on the National system. Take a total freight traffic of seven billion ton miles, with an average rate per ton per mile of .55 cents. Let us assume that the grain traffic is 60 per cent of that, and in round numbers let us take it again, as I took it the other day, at four billion ton miles. Now, we have an average rate on our grain of .52 cents. Let us assume an operating ratio of 70 per cent. Then the average cost per ton mile is 70 multiplied by 55 divided by 100; that gives your average rate per ton per mile. Your operating ratio1 is 70 per cent of those receipts, that would give you for your cost .385 cents per ton mile. I think that is clear because there is no hing of an Einstein character about this at all. It is perfectly clear to everybody who wants to understand it and who really ought to understand it. That would give a net operating profit on grain of .52 cents which is the grain rate, less the .385 cents which is the average cost per ton mile, yielding a profit of . 135 cents per ton mile. Now hon. gentlemen might think that was a very small thing, but it is a big thing. That was one of the reasons why I have always attributed much more money to this business than many railroaders did. That little decimal .135 of but one cent on a traffic of 4.000.000,000 ton miles gives a profit of $5,400,000. Now, just see how easy that is changed? Supposing we take the figures which we 'had last year, the same 7,000.000.000 ton miles of traffic with an average rate per ton mile of .763 cents.
The general average rate has been raised, But we will take the round figures for the grain traffic of sixty per cent at 4,000.000,000 miles. The grain rate did not go up with the others; the grain rate still stands at .52 cents although the average goes up to .763 cents. Now, supposing we take the operating ratio which obtained, that is 91.08 per cent, make the same calculation and you have a cost per ton mile of .694 cents, resulting in an operating loss of the difference between that cost .694 and .52 cents or .172 cents, bringing about an actual loss of $6,880,000.
I do not think I should further delay the committee except to point out that my hon. friend wants the same rates as in the east. We would welcome that if it were not for one thing-we want to see the west function. My hon. friend wants the same paper rates as in the east, which will not help anybody except some newspaper editors, or some politician who wants to create a grievance here and a grievance there. I would have no objeotion if it were not for one thing. That is we all want to see the west continue to grow and prosper. If that is what my hon. friend wants let us in all fairness refer the whole matter, without any limitation, to the railway board. If it is my hon. friend's wish he can have the whole matter referred therej_ but it will not do to try and load the dice in two directions at the same time.


George Perry Graham: I am not going to delay
the committee more than a minute or two. My chief utterance will be that the government cannot accept this amendment, for the simple reason that if an amendment is to be accepted to give special treatment to a particular territory, even in addition to the special treatment in the extended territories covered by the Crowsnest pass agreement, on grain and flour, then let us throw the matter wide open and give the same treatment to all parts of Canada. The government has endeavoured, and hon. members have shown on all sides a wish, to meet the desires of the west, but our kind-heartedness does not. seem to have 'been appreciated. If this additional advantage is to be given to the prairies extending to the Rocky mountains, then I say ignore the Rocky mountains and go through to British Columbia. If this additional advantage is going to be given to the prairies then open it up to the province of Ontario, give it to Quebec, give it to the Maritime provinces, and allow your railways to go to the demnition 'bow-wows.


Arthur Meighen: The minister had better go right on now and deal with the whole problem.
Railway Freight Rates


George Perry Graham: Well, as I pointed out in the House before, we are endeavouring to meet the views of a part of Canada that has had the Orowsnest pass rate for a long time. We are endeavouring to meet that situation, not so much for the people themselves as to meet the psychology of the situation so that the people of the prairie provinces will have no opportunity to feel that they have not been treated generously, I would say, in comparison with the other parts of Canada. I think I need not make any further explanation, I think my hon. friends will see that the government and parliament could not accept that amendment to give still further preferential treatment to the prairies over every other part of Canada.


Mr. BIRD:: I will not detain the committee for any length of time except to say a word or two in support of the amendment which I think to be a very generous one from the standpoint of western Canada. The government in putting forward their proposition made two or three claims with which I want to deal. In the first place they claimed they were delivering the country from the confusion in which it found itself at the present time with regard to freight rates. I want to ask who produced the confusion, and why? One of the parties to the agreement is responsible for producing the confusion, and the reason for producing confusion was to defeat the declared will of parliament, to dispossess the west., and to fool the people of Canada. That is why confusion was produced, one of the most astounding pieces of psychological trickery this country has known. It reminds me of the trick of the pickpocket who will cause a disturbance in a crowd in order that his colleagues may get away with the jewelry. That was the cause of this confusion that has been projected into the minds of the people of Canada. This is the very thing that inspired Aesop's fable about the wolf and the lamb. You remember how the wolf stirred up the mud in the stream in order to have an excuse to devour the lamb. The railways of this country have precipitated the situation which is poisoning the mind of Canada, and if the public mind had not been poisoned the government could not have got away with this bill to-night. Now, the government by their passive attitude were responsible for allowing that poison to work in the public mind. A psychological situation has been created by the supineness of the government. They are responsible for it indirectly, and yet to-day they are bragging because this bill is going to cure the situation 
that they themselves helped to create. It is like a physician exposing a man to contagion, and then bragging because he has helped to cure him. That is the situation the government are in. Since last July they have condoned the action of the railways, one of the parties concerned in the agreement, in poisoning the public mind of Canada, and to-night they are taking advantage of that state of public mind. I challenge the government to say whether they could have got away with this if the ground had not been very carefully prepared for them.


George Perry Graham: May I answer that question? If the government did not stand as the buffer, the whole Crowsnest agreement would have been wiped out at this session by an enormous majority. The government has been trying to protect my hon. friend so far as it could, and now it gets abuse for doing so.


Thomas William Bird: Why would the Crowsnest
pass agreement have been wiped out at this session? Because the public mind of Canada had been prepared for wiping it out, and the government has been a party to that.


Mr. STORKE:: We can do it yet if you
go too strong.


Thomas William Bird: The real situation this last
few days has not been the confused state of the freight rates in Canada; it has been the confused state of the public mind into which the freight rate situation has brought it. During this debate the government has not been free from the attempt to put upon us the onus, as though we were trying to defend an indefensible position, a position that is bringing Canada into a state of utter confusion in regard to- its freight rates. The thing to be discriminated in the public mind -it may be too late-but what we want to discriminate in our minds is between the Crowsnest pass agreement as it stands tonight and as it will stand until this bill is carried, and the Crowsnest pass agreement as we knew it prior to 1917. We are not standing for the Crowsnest pass agreement as it stands to-night; we want the Crowsnest pass agreement as it stood prior to 1917.
The CHAIRMAN; I would call the hon. gentleman's attention to the fact that this debate has been limited by the amendment that has been moved by the hon. member for Marquette (Mr. Crerar). There is another general clause of the bill dealing with rates.


Thomas William Bird: If I get my remarks over all
at once, Mr. Chairman, it will relieve me of the necessity of speaking later.

Railway Freight Rates


George Perry Graham: Get it all out and you
will feel better.


Thomas William Bird: The Minister of Railways (Mr. Graham) in presenting his case said that there were only three alternatives-to destroy the Crowsnest pass agreement, to continue it as it is, or to accept his own intermediary proposition. Now we on this side do not admit that there are only three alternatives. There was another alternative, and that was to restore the Crowsnest pass agreement as we understood it prior to 1917, and I might say, after listening to the case of the Solicitor General, prior to the decision of the Supreme court itself, because even the government itself according to his generous interpretation, stood for the old Crowsnest pass agreement until that date.
The Minister of Railways said that this bill was necessary in order to save the railways. He might as well have said that at first. I believe that that is the motive of 9 p.m. the whole bill, to save the railways. These are the words he used. He said: " Parliament can ruin the railways." Now I think that is the gist of his whole position. Parliament can ruin the railways. The attitude we take expresses itself oppositely from that. We believe that the railways can ruin the people whom parliament is supposed to represent, and we believe that the railways will ruin the people if they do not wake up. We have abundant evidence to show that it is the people who need protection against the railways. We have come to the point, as one writer says, where we no longer ride on the railways, but the railways ride upon us, and they would ride upon us still more if the people themselves did not have some degree of say in this House. Parliament can ruin the railways indeed but this parliament, as it is presently constituted, has not much chance of ruining the railways. The railways have too many stout defenders in this House for parliament ever to ruin them. We have listened to some extremely good briefs during this debate on behalf of the railways. We have not heard any similar brief on behalf of the people of western Canada. We have had one or two good speeches on behalf of the west, but we have had nothing equal to some of the lawyerlike statements made on behalf of the railways in this debate. No, Mr. Chairman, there is not much chance of this parliament ruining the railways if it continues to be constituted as it is at the present time. The Crowsnest pass agreement, when it was first instituted, was meant to safeguard the people.


George Newcombe Gordon: I must again draw the hon. member's attention to the fact that there is a limitation to this debate. This is not a general rate debate by reason of the admend-ment that has been introduced by the hon. member for Marquette.


Thomas William Bird: I would ask the Chairman to
have a little more patience with me while I develop my argument.


George Newcombe Gordon: I cannot, because this
debate is limited by reason of the amendment introduced by the hon. member for Marquette.


Thomas William Bird: I am sorry. I will endeavour
to shape my remarks to meet with your views, Mr. Chairman. I was proceeding to say that the Crowsnest pass agreement in its first intention was meant to safeguard the rights of the people. That is the distinction between the original agreement and this bill. This bill is framed to safeguard the railways. The original agreement that we are asked to give up for this was meant to safeguard the people. That is the distinction between the old and the new, and that is the way it will work out so far as I can see.
The Minister of Railways complained that the yardstick, as he called it, as laid down by the Crowsnest pass agreement, was too short for modern conditions. He gave no proof of it, and I do not think there is any proof of it. I think the hon. member for Marquette proved conclusively that the yardstick laid down by the Crowsnest pass agreement is abundantly long enough even for present conditions. But supposing it was not long enough, supposing the yardstick had shrunk relatively, supposing it was no longer adapted; is the proposition of this bill before us the right one? This is to do away with the yardstick altogether. Is that the right proposition? I believe that the amendment is the right one, because it introduces what this bill alone abolishes; it reintroduces the yardstick, as the minister calls it. It lays down a standard by which rates in western Canada as they have been in the past will be determined in relation to rates in the east, where special factors enter into the situation, and will guarantee to western shippers a measure of justice.


Mr. McTAGGART:: Would the hon.
gentleman be agreeable to laying down the yardstick for other parts of the Dominion?


Thomas William Bird: I think what I have just said
implied that a yardstick was necessary for the west in the sense that it was necessary for the east, because the east, as has been said over and over again in this debate, has its

Railway Freight Rates

controlling factors, not only in the water competition but in the American railways. We regret that these extraordinary pecautions should be necessary, but we .cannot help the situation in which we find ourselves and if the Crowsnest pass agreement with its yardstick was necessary twenty-five years ago, it is necessary now. That is one thing that no person has dealt with in this debate. There was a reason for the institution of the Crowsnest pass agreement and that reason was the exposed position of the western shipper as compared with the eastern shipper. The Crowsnest pass agreement was not instituted for nothing. It was not a freak. There was a reason for it, namely to give some assurance to the western farmer and the western shipper that he would not be imposed upon in fixing rates. We are not contending for the former rates, but for a principle. It is all very well to say, "Trust the board", as our hon. friends to our right have stated. It is like asking Esau to trust Jacob.


George Newcombe Gordon: I must call the attention of the hon. member to the fact that his remarks are not relevant to the amendment, and are therefore out of order.


Thomas William Bird: The Chairman's ideas of
what is in order and my own ideas seem to clash at every point.


George Newcombe Gordon: Sections 2 and 3 dealt with the general question of rates, and an amendment was moved by the hon. member for Marquette (Mr. Crerar) limiting the debate to a certain rate from Sudbury east and from Fort William west. There is a further clause dealing generally with rates, under which my hon. friend might discuss the question of rates. But the limitation of this amendment is so clearly defined that I submit there can* not be a general debate.


Thomas William Bird: The object of this amendment is to substitute something which is lacking in the bill.


George Newcombe Gordon: No, not to substitute
anything. It is adding a subsection to it.


Thomas William Bird: It is to supply something that is lacking under the bill. By inference I feel I have a perfect right to refer to these matters.


George Newcombe Gordon: I rule the hon. member must debate the amendment. He can discuss the general question of rates under section 4, but he cannot do it on this amendment.


Thomas William Bird: We have heard quite a bit
about equalization in this debate. The last

speaker dealt very fully with the question of equalization. Now the socialistic belief of the ex-Minister of Finance in regard to the impossibility of equalizing unequal things is a little difficult to grasp in this connection. It seems to me that he suggests a remedy for this situation which amounts to robbing Peter to pay Paul, or cutting a little bit off the top of the blanket and adding it to the bottom. His profound treatment of the subject amounts to nothing more than that, and this profound remedy, this obscure and abstruse remedy has to be left in the hands of the Board of Railway Commissioners. Now I am treading on dangerous ground again, but I do not see how I can go ahead with my argument without bringing in the railway commission.


Robert Forke: The ex-Minister of Finance
did nothing but talk about rates.


Thomas William Bird: I cannot talk about rates
unless I bring in the railway commission. It seems to me to be a new conception of British government that we should relegate the most vital things in matters of government to commissions. Here we have something more important than taxation so far as the west is concerned. No proper conception of the British constitution would tolerate for a moment the relegation of taxation to a commission which had no responsibility to anyone, Which represented nobody; and yet that is what our friends to my right would have us do. They would have us commit something which is more vital than taxation in this country to a body of men who are not responsible, with only some vague appeal from that body to the Governor in Council. That is a thing that cannot be tolerated for one moment on broader principles than we are considering to-night; and as we are situated in the west, we cannot subscribe to a theory of that kind, not only from the standpoint of theory but because of the lessons of experience. The railway commission, whatever their intentions may have been, have played into the hands of the railway corporations of this country as against the westerr shipper. That is what the western shippe believes, and he believes it because of the experience he has had, and yet we are asked to forego all the safeguards we have ever had and place our fortunes in the hands of a commission of that kind.


Thomas Vien: Will my hon. friend say that
he thinks the railway commission should disregard altogether the interests of the railway companies of this country, including the Canadian Nations' Railways?

Railway Freight Rates


Thomas William Bird: Not at all; I am not contending that the railway commission should have a free hand in any direction.


Thomas Vien: You said just now that the
railway commission had played into the hands of the railway companies of this country.


Thomas William Bird: Yes.


Thomas Vien: Will my hon. friend say that
the Board of Railway Commissioners should ignore the interests of the railway companies which carry on the business of railway transportation in this country, including the Canadian National Railways?


Thomas William Bird: No, I did not say that. I
think the railway commission should have regard for this parliament which represents the people, and carry out the policies laid down in parliament.


Mr. CANNON:: The hon. gentleman has
been criticizing the railway commission whieh is a judicial body. I raise a point of order.


Some hon. MEMBERS:: Order, order.


Lucien Cannon: My hon. friends may
laugh, but they had better read the rules of the House first.


Thomas William Bird: I have as much regard for
the sanctity of the . railway commission as my hon. friend, only I do not see as much sanctity in it as he does. If this theory of an all-powerful railway commission is to be carried out-and to all intents and purposes the government are at one-


Lucien Cannon: I do not like to interfere
with the hon. gentleman's speech, but I raise a point of order and I should like to have a ruling.


George Newcombe Gordon: The point of order
raised by the hon. gentleman is the well recognized rule that judicial officers or bodies must not have wrong motives imputed to them in their hearing of cases or in their judgments. I did not understand that the hon. member was imputing wrong motives in what he said, but an hon. member cannot impute dishonest or any other kind of sinister motives to any judicial officer or body.


Lucien Cannon: If I understood the hon.
membeT aright-and if I did not, I stand to be corrected-he said that he had no confidence in that board. Any hon. gentleman who says that he has no confidence in a judicial body certainly should be called to order.


Thomas William Bird: I was referring to the board,
not as persons but as a system for regulating 286*
freight rates in Canada, and I have no confidence in the railway board as a system for fixing railway rates in Canada, because I believe it will work out to the detriment of the people of western Canada.


Lucien Cannon: Why so, may I ask?


Thomas William Bird: That is the point at issue.


Lucien Cannon: Would the hon. member
not have any confidence in the decisions of that board?


Thomas William Bird: No, because I believe it is
an arbitrary body far removed from the will of the people.


Edward Joseph Garland: Ask the
Minister of Agriculture (Mr. Motherwell).


Thomas William Bird: If the railway commission
were all composed of autocrats, Mussolinis. I would not trust them as a means of regulating rates in Canada. I will not trust any body that is not responsible to the people.


Mr. RINFRET:: What about other courts
of justice? If my hon. friend had a suit coming before a court, would he not have confidence in the decision- of the judge?


Thomas William Bird: Judges deal with matters of
fact, not with matters of policy. There is, however, something to be said about courts of justice being more representative than they are at the' present time. The point I was coming to was this, that without some such provision as this amendment supplies, the west is going to be, as was so well put by the hon. -member for Marquette (Mr. Crerar), eternally squeezed between the tariff and high freight rates. There is no doubt about that in my mind. The tariff compels us to buy our goods from the east, and this bill is going to compel us to pay increasing freight rates upon those tariff-burdened goods. I can see that the people in the north whom 1 represent, every time they eat at their breakfast table, will have the consciousness that they are helping to save the railways of Canada -from ruination. They are going to pay more on the fruit they eat, on the things that enter into their houses. I would like hon. members to see some of the houses which the people of the west have to live in by reason of the high cost of building material. Every time a man tries to make * his farm house a little more comfortable, he will have the consciousness that he is helping to save the railways of Canada from ruination.
The minister says that there are compensations. I do not think there is any compensa-
Railway Freight Rates

tion for taking away our safeguard in regard to westbound traffic. This amendment has in view the assurance of that safeguard. We do not want compensations. We want the thing that we have always had and rejoiced in- a sense of security as against the Board of Railway Commissioners. What is the use of talking to us about compensations? To-night I suppose we are standing at the open grave of the Crowsnest pass agreement, and the minister comes and talks to us of compensations. That does not comfort us in the least because, so far as we are concerned, the Crowsnest pass agreement is dead forever. It may remain on the statute book, but it is of no further use to us as a rate-controlling factor. Compensation means an equivalent. Are they giving us an equivalent? Why, they have taken a dollar from us, and they are giving us fifty cents back and telling us that is compensation. That is the situation. We started with a dollar and now we have fifty cents.


An hon. MEMBER:: You are lucky.


Thomas William Bird: Yes. The man who went down from Jerusalem to Jericho was lucky too. In the midst of the confusion that has been created by the railways themselves-and I have literature at hand which shows how carefully, how elaborately, public opinion of Canada has been cultivated for a year now -they are trying to persuade us that- we are being compensated. The minister has tried to persuade this House that we are getting something that we have not had before. We are not getting a thing that we have not had. Everything in this bill we had prior to 1917. But there is something lacking in this bill that we had prior to 1917. Something that we enjoyed in 1917 has been shorn from the Crowsnest pass agreement. So it is of no use for the minister to come along and say that we have been compensated. The Crowsnest pass agreement has been tom in two. Half of it has been thrown into the wastepaper basket, and the other half has been handed to us with a flourish. But we could not accept it in that spirit, because the soul of it has been destroyed. What compensation is there for the loss of a principle? "What shall a man give in exchange for his soul," the Scripture says, and the provision in the Crowsnest pass agreement whereby the west had an assurance in regard to rate fixing, was the soul of that agreement?


Lucien Cannon: How can the hon. gentleman reconcile the soul with anything material?
tMr. Bird.]


Thomas William Bird: I have no desire to seek a bubble reputation at the cannon's mouth. I think I am interpreting the view of western Canada aright, especially that of the northern parts of the western provinces, when I say that, as generous as this bill is made out to be, while there are in it some things that we shall be prepared to accept if we cannot get what we want, it will be with regret and protest because we believe we are losing the principle of the whole thing. We believe that all the advantages we get in the provision made for eastbound freights will be absorbed by throwing the westbound rates wide open. That is our opinion and for that reason we regret to say that we cannot thank the government as warmly as we should like. Someone has said that if we knew all we would forgive all. Perhaps if we knew all the difficulties with which the government has to contend we would forgive all and probably think ourselves lucky, as some hon. member on the opposite side has significantly observed, in getting as much as we are getting to-night. Probably if we knew all that the Minister of Railways has to put up with we should be glad to get the remnant that is now handed to us. But that is only a tempered kind of gladness, and if this bill passes to-night, as no doubt it will, we in the west shall feel that we have lost the protection we have enjoyed for twenty years.


Lucien Cannon: I thought you were a free trader.


Thomas William Bird: Our friends to the right have as usual spoken of special privilege and patriotism; they have talked about doing things for the good of Canada. That nebulous object is always strutted out whenever some practical concern is to the front in this House relating to the life of the people. This idea of doing good to Canada as a whole does not commend itself to me as it is put forward in this House because it is always put forward as a screen to prevent us from getting concrete good. It comes badly from hon. gentlemen to the right as well as from our friends opposite to talk about narrow-eyed sectionalism. We always hear that plea put forward, at least we have heard it in the last four years, whenever anything vital to the west has been considered. I say this feelingly, because on all other matters we have heard the same plea; and to-night the Crowsnest agreement is going the way of the Hudson Bay railway. And their going is none the more graceful for the paeans of praise that come from the other side. These two things have gone and their going dates from the same time, 1917,



J925

[Stage Direction]
Railway Freight Rates
which was so fatal a year for western Canada. What western Canada has lost in the interval she has not made up and from all appearances to-night there will be no chance of her making it up. There is a dead set against the west in this House to-night; one can feel it in the atmosphere. It is no use denying this, for it is all too patent to anyone who has his eyes open. I therefore as energetically and earnestly as I can make my protest against the passing of this bill.
William Charles Good: The amendment proposes a
restriction on the freedom of action of the railway commission, and the question arises as to why the railway commission should be restricted in any way. Our friends to the right argue that the commission should not be restricted at all, but I think it must be apparent to everyone in this House that there is at least a large section of the Canadian people who have lost confidence in the board. For one reason or another which I do not intend discussing, the Board of Railway Commissioners, on whom I make no reflection, have lost the confidence of a section of the Canadian people; and that being the case it would seem necessary that some kind of restriction should logically be imposed on the board. Even if we all had confidence in the board I think that it is only a fair proposition that some sort of basis of action should be specifically laid down by this House for the board to take; there should be some fixed principle to be applied. I do not see that up to the present time any such principle has been in force. The leader of the opposition (Mr. Meighen) has argued, very well I think, that the board ought to be provided with certain principles upon which to act, just as our courts are given laws to interpret and apply. But so far there has been nothing adequate of that kind provided the board. If the Minister of Railways now or sometime in a subsequent parliament would lay down some definite principles of equalization or otherwise for the board to interpret and apply, I do not think we should be in the position we now find ourselves in, and in which we have been for the past few years. I would suggest that until a sufficient body of principles is laid down in our Railway Act in the matter of freight rates it is perfectly logical and necessary, and not at all to be disparaged, that this parliament, representing the people, should tie the hands of the railway board in some way to prevent either discriminatory or, shall I say, unpatriotic action. There is a disposition here to regard as unwarranted any attempt at restricting the action of the board. But I submit that it is perfectly logical and desirable that until such time arrives as we have established certain adequate principles for the board to apply, some restriction of the kind should be adopted, limiting the freedom of action of the board.
Amendment negatived: Yeas, 38; Nays, 109. Section agreed to.
On section 4-Tolls in tariffs filed prior to act to be deemed lawful.


George Newcombe Gordon: By way of amendment the Minister of Railways proposes to substitute the following section:
4. To remove doubts the tolls specified in tariffs filed at any time prior to the passing of this act with the board in accordance with the provisions of the Railway Act 1919, are and shall be deemed lawful tolls until varied by tariffs filed with the board pursuant to this act, notwithstanding the provisions of any act or any agreement and notwithstanding any judgments or orders made at any time prior to the passing of this act with regard thereto.
The question is on clause four.


William Findlay Maclean: Mr. Chairman. I have listened very closely to the debate during the course of which the Minister of Railways (Mr. Graham) said that the Crowa-nest pass agreement had not only shot holes into the whole tariff structure, but especially was it injurious to the Canadian Pacific, and still more so to the National Railways. Well, if that is the case, something ought to be done to cure the resultant situation, and I am going to take a few minutes to suggest what I think parliament ought to do to solve the problem now before the people of Canada caused by the overbuilding of railroads, and still more by the changed conditions due to the opening of the Panama canal. What has happened? Not only are our railroads encountering a keener competition every day, but as time goes on it will become more and more serious. The outstanding feature of the railway situation before the people of Canada to-d'ay is the competition that is steadily growing by the operation of the Panama canal and thie creation of great seaports on the Pacific ocean, thus diverting traffic from our two railway systems. Not only is that competition steadily growing in volume, but the outlook for the future of our railroads is ominous indeed when we reflect that by the joint action of the United States and Canada ' the deepening of the St. Lawrence waterways will make Toronto, Buffalo, Cleveland, Detroit, Chicago, Duluth and other interior lake ports virtual seaports. That will happen in less than ten years, and will take away a tremendous amount of business from our
44S0
Railway Freight Rates

railways. The consequence will be that instead of the two great railway systems biting their heads off by needless duplication of transcontinental and branch lines, they will find there is not enough traffic left in the whole country to support ome of them, or even the consolidated system which I suggested when the right hon. gentleman who leads the House (Mr. Mackenzie King) introduced his scheme for getting control of ocean freight rates. On that occasion I said that the country had been railroaded to death, and that to-day there was not enough traffic to support the wild race of duplication now taking place all over the country. I quoted good authority for the opinion that by the consolidation of the Canadian National and the Canadian Pacific a hundred million dollars would be saved annually to the country, and this money -would be sufficient to pay a five per cent dividend on the three hundred million dollar stock of the Canadian Pacific, ten million dollars to an amortization fund to discharge the -whole debt, and 4 per cent on a billion of dollars investment in our National railways. At once our railways would be on a paying basis, for there would be none of this senseless competition, none of this wild duplication, but instead a wise economy.
We have heard a lot in the course of this debate about freight rate structures, and some hon. gentlemen appear to use this term with great satisfaction, but it simple means a bill of freight rates. "Freight rate structures" is a phrase which rolls off the tongue as smoothly as the word "relativity,"-in fact we are hearing a good deal about the theory of relativity in connection with rate making. But the real cure for all the grievances that hon, members from the west have presented to the House is to be found in stopping this wild riot of extravagance in connection with our railroads. The people know that this is the cure, and they want it applied now. The government have attempted to find a cure in the two propositions which they have brought before the House this session. The Prime Minister introduced a measure known as the Petersen deal for the control of freight rates. It was presented to this House and was received with great applause from his followers.


George Perry Graham: Order.


William Findlay Maclean: I am in order.
The Minister of Railways does not like to hear this because of the "fall down" which happened to that contract. And here and now another deal is presented to the House in the
r^r.. W. F. Maclean.]
form of a reference of the railway problems to the railway commission instead of dealing with them here. These are the facts and on these facts I am going back to my constituency to try and seek re-election. I hope to go there in the month of September or October and that is what I am going to talk about. I am not going to discuss the Petersen deal. That has been one of the greatest failures ever witnessed in connection with any policy attempted in this country. The Minister of Railways says the Crowsnest pass agreement has been a failure, has been a fraud. In other words he has treated the people of Canada to a dish of crow and everybody is being called upon to partake of that dish. Down in the other end of the chamber a caw-caw party has been decided upon and hon. members there are in the same business. These are the two proposals made for dealing with the great railroad problem in this country: It is a dish of crow in the one case, and a caw-caw party down the line for the cure of our railroad problems. That is not the cure. We have got to begin in this House. We have to fight it out on the platform during the coming election and settle what we shall do about this mad system of railway duplication, of radio equipment and -those little baby parlors, on trains where they get "brer-rabbit" and all those things supplied to-day. That is not what parliament ought to be engaged in doing. Parliament ought to be engaged in curing the railroad problem of the country. That can only be accomplished by consolidating the two railroad systems. That will not only save the $100,000,000 to which I have referred but it will do something else. It will pave the way towards meeting the increasing competition that is coming from ocean and lake. Yet the only two solutions that have been suggested to us are the Petersen deal, and feeding out crow to the public. These remedies will not cure the evil at all. On their stand on this question the Frime Minister and his government, including the Minister of Railways, will be tried by the people of Canada in the coming election. That will be the issue unless somebody in this House has a better cure, something like the one which I have suggested. What I propose is that we should stop this mad rivalry of two railroad . systems running in competition with each other. How many times have I gone up to Toronto and seen one train with a few passengers, and the other train half filled

a mad competition-with the passengers leaning out of the windows and laughing. The same

Railway Freight Rates
thing is true in the case of the transcontinental service, a mad race across the whole country, and even in the case of branch lines this race is going on. The only remedy that is suggested for all this is a dish of crow or a caw-caw party.
Some hon. MEMBER'S: Oh, oh.


William Findlay Maclean: My hon. friends
may see something to laugh at but I do not take it as a joke. Never was the position of this country so serious as it to-day. Never did the people suffer under such taxation as they do to-day; and never was there such extravagence in spending millions of the people's money in a mad race to maintain two competing systems of railways where one would be sufficient and give better service.


Thomas Vien: Would my hon. friend allow
me to ask him a question?


William Findlay Maclean: Yes, two.


Thomas Vien: Does he forget the mad extravagence of seven or eight years ago?


William Findlay Maclean: It has been going on for twenty years. It began, probably, with the Canadian Northern and the Grand Trunk Pacific, and has been aggravated by the policy of those who preceded the last government and the present government in office.


Mr. ARCHAMBAULT:: What about the
purchase of the Canadian Northern?


William Findlay Maclean: That was a bad
thing.


Joseph Archambault: What about the
purchase of the Grand Trunk Railway.


William Findlay Maclean: That was a bad thing too. But if these were bad things why aggravate the situation by continuing it? Why not try ,to stop it? I challenge the Prime Minister to come into my riding, I will go into his if he invites me-and I challenge the Minister of Railways to get up on the public platform and suggest some real remedy and not talk about "rate structure." To them "rate structure" is a fine term.


Joseph Archambault: Did not my hon.
friend vote for the purchase of the Canadian Northern?


William Findlay Maclean: If I did I am
sorry, and I have repented.


Joseph Archambault: Did my hon.
friend vote for the Grand Trunk Railway purchase also?


William Findlay Maclean: I think so, ye3,
and I am sorry for it. Where is my hon.
friend on the question? Let him tell me now where he is.


Joseph Archambault: I voted against it.


William Findlay Maclean: Well, he is up
a tree all the same because he is continuing the policy now.


George Perry Graham: We are all sorry but that does not remedy the situation.


William Findlay Maclean: The railway problem is before the government and the only cures suggested are the cures I have mentioned. Parliament is washing its hands of responsibility in connection with railroading in this country and is putting the responsibility on the railway commission. That will not do. We cannot unload this .mess on the Board of Railway Commissioners. Parliament must clean it up. The Prime Minister and his colleagues have had that duty imposed upon them, and instead of discharging it we have the Minister of Railways with his two aides in the new King cafe going round serving the public and taking their orders for crow.


Joseph Archambault: That is some bird.


William Findlay Maclean: In all seriousness I address myself to the House, and I address myself particularly to the Progressives down the line .there. I say to them "You are talking about something that is a real question to you and I sympathize largely with you. But what you have suggested is not the cure; it cannot be brought about in .that way." The only way it can be brought about is to stop this mad competition now going on between the two railroads that have two headquarters, two systems of publicity, two systems of express, and two systems of telegraph, whereas one only would do. The country demands but one and its view must be met. If this parliament refuses to amalgamate these two systems in view of the terrible competition that is coming to these two railroads by reason of the Panama canal, which will be very much aggravated by the building of the St. Lawrence waterways system, the responsibility is upon it. In regard to the St. Lawrence waterways the congress of the United States is voting millions of money, and if we got in touch with, them and said we were ready to assume our share of the deepening of the waterways, we would be able to give employment all through the St. Lawrence territory, and we would create thriving sea ports on all our inland waterways.
Now I want to ted.l the Minister of Railways how far this water competition is likely to igo, and I am going to quote his predecessor John Hacsar.t, with whom I sat in this House
Railway Freight Rates

and many a itirne discussed this question of water competition. He used tio say to me: "Maclean, I have had engineers, the most eminent in the would, oome to me and say they are ready to canalize the country from lake Superior to the foolt of the Rocky mountains, and if you did that there would be hardly any traffic left for the railroads." That is where water competition is coming in this country. It is coming; it is knocking at the door. It has come in the United States on the Pacific coast, and will come to. us here in Canada in less than eight years, if the programme of the government of the United States gets started, and it will foe a lightning programme, The work will foe divided up 'into sections and will foe done in less than eight years. If that comes about, are we still to go on with this mad competition, maintaining these two unnecessary systems of railroads? The opinion of Montreal 'is that instead of two systems of railways there ought to foe only one; the whole story in the Montreal Star last night, was that the itwo-railroad system was a mistake, wiith all,the squandering on railroad construction that has gone on in this country resulting in the deficits we have on the Canadian National to-day. iMy proposal to this' House for ending that deficit is to consolidate the two roads, and to stop the mad duplication, the wasteful competition, save the money, and get ready for .this water competition that is doming to our railroads. Why, if this competition goes on, as it is likely to dio, there will not foe enough freight traffic coming in to support the .two roads. My friend the late chairman of the railway commission has told us that the railways have to earn enough money to carry them on, I say these two railways cannot earn enough money to carry them on, and we shall have to make up the deficits in one way or another on both these roads, year after year, unless we stop this mad competition, and if we do not stop it, the people of this country will stop sending us to this House to represent them, and will find other men who will deal with the situation.
I am not going to take up any more olf the time of the House. I have had the attention of the House. I do not know whether I shall have the attentibnj of the country or not. I would like to speak a little about what chance anybody has of getting the eair of the country these days, when we have1-I do not want to say what condition of affairs-but I hope the newspaper situation will improve and that once more we shall! have some newspapers that are not afnaid ito tell the people what the real conditions are, and especially with regard

to this mad duplication in railroad construction, Wtiait we do want in these hard times is ho induce the American government to start at once, with our co-operation, the development of the St. Lawrence waterway, the creation of seaports on the lakes, and if necessary, even to canalize the country from lake Superior ito the foot of the Rocky mountains-Why, John Haggar.t used to say: You might see a seaport on lake Winnipeg, and he had good reasons for saying that. I have only two things to say to-night, and I have only two things to say when I go to the country, and I hope to go. I will tell the people that this imad dance, this wild froliq, this crazy carnival that is now going on, with two railways, two headquarters staffs, two sets of lawyers, two propaganda and publicity departments, two systems of express, two systems of telegraphs-


Milton Neil Campbell: And two immigration
systems.
Mr. iMACLEAN (York): -and two im-migation, systems, duplication in every direction

all this must stop. You would think we were over-stocked with money. The money craze that was caused iby the war and war profiteering has been carried into the business of -this country down to the lowest branches. What we want is economy. We do not want extravagance, but actonomy, and it has got to come, or something is going to foe wrecked. We have the predictions of the Minister of Railways, and the opinions that have been read to the House especially by my hon. friend from South Oxford (Mr. Sutherland), and if this sort of thing goes on in the railways, those predictions will come true, and there will be railroads wrecked and people too.
The west is crying for relief from the present railway situation, and so is British Columbia, and so are the Maritime provinces; it is what we want here in the east, and yet we are not dealing with that problem. We are sidestepping it by such proposals as the Petersen deal, and we know what that means. There never was such a fine lot of promises as were made in this House in the second month of this session when I rose and congratulated the government, and especially the Prime Minister, upon their attempt to solve the ocean freight problem, but I said:	You are not going the
right way about it. Instead of subsidizing a new line, put the Canadian Pacific in with the Canadian National, and use their line of passenger steamers and freight boats with the ships of the merchant marine, and then you will start to solve the ocean freight rate problem. You would not only get a solution

Railway Freight Rates
of the ocean freight rates problem, but you would get a real consolidation of the two railroads with all the economies that would be derived therefrom. If you do that, you will start the country on a new wave of prosperity, and especially will you start the country on a new wave of prosperity by developing the waterways and establishing seaports, planting them right up to Duluth and perhaps up to the foot of the Rocky mountains. I am not giving you any pipe dream. I am presenting the cold-blooded facts as they present themselves to me. I am talking now as one of the elder members of this House. I have been in this House a long time-


Thomas Vien: Does the hon. member propose to sell the Canadian National to the Canadian Pacific, or to purchase the Canadian Pacific?


William Findlay Maclean: I would take over the Canadian Pacific and merge it with the Canadian National. The Canadian National is owned by the people of Canada, but Goa knows who owns the Canadian Pacific. Two-thirds of it is owned in New York and London, and we have not any control of it. but we have control of the Canadian 10 p.m National, and the Canadian Pacific will be glad to come to us the minute we say we are ready to deal with them. They cannot take over the Canadian National, nor would the people of this country stand for it for one minute. The Canadian Pacific tomorrow might pass into the hands of the New York Central or the Pennsylvania, or any of the other great systems in the United States, and then they would be masters of this country. I am an absolute believer in the Canadian Pacific. I am one of the few men in this House who knew George Stephen. I am not boasting at all, but I have often talked with him and Lord Stratheona. I knew the two of them to be great friends of the National Policy in the old days. They were very simple men, and they had a great railroad scheme for this country, and it has been achieved so far as their ideas went. The Canadian Pacific is a great railroad to-day, but the Canadian National is a greater one, and it is owned by the people of Canada. But these two railroads are being extravagantly run and a way has got to be found of bringing the two together into one system, and of using the ships of the two systems also to solve our problem of ocean transportation. If we do that we will make our railways pay within one year after consolidation takes place. The real merit of the consolidation of the two systems is in the economies that will be effected, but the
greatest economy that will result from the consolidation will be the re-routing that is allowed by such consolidation. We will take the best parts of either system, whether it be in reference to grades, .bridge crossings or entrance, into the towns, and we will put these two lines together, re-route them, and take the best features of both. We will double track them, and out of the two systems we will make a great transcontinental line. I hope that the transcontinental business will require a four-track system, and some branch lines may need double track equipment. If we do that, we will effect real economy, and it will not cost much.
This country wants us to stop this mad policy of duplication and immense deficits in connection with two unnecessary systems, and to get down to the real problem of dealing with the St. Lawrence waterways, and bringing ocean steamers from the Atlantic right up to the head of lake Superior. If we accomplish that object we will witness improvement in our affairs, .the farmers will be in better shape and the freight rates will be reduced. There is an enormous expenditure on the two systems. The hon. member for West York (Sir Henry Drayton) is very well posted on all these questions, but I am sorry he has not quite	seized	this idea.	After	all hisexperience	he has	not yet told the	country
something which I am sure he absolutely believes, namely, that the duplicate system is worn out, and the time has come for a single system.
People ask, "What would happen if we had one system of railways? Would we not be ridden by	labour	unions or	things	of thatkind?" I	do not	believe it.	Ontario has a
publicly-owned railway and it is well run. We have a publicly-owned railway in Canada and it is well run. Ontario has a splendid system of distribution of electrical energy which is well run. My own city has a splendid system of transportation publicly-owned. I think I know what is going on in the United States, and I tell (the House that the United States is advancing in this line. In the United States they have in mind the consolidation of the transportation system and have ordered its consolidation. The railways over there have been consolidated into eight regional divisions, and now they are going to get the number of divisions down to five In a short time you will see these divisions consolidated, and the day after they are consolidated the American people will take them over and run them as the railway system of the United States. That is the line on which the world is moving. The people of Canada
Railway Freight Rates

are beginning to realize the position and desire to see consolidation, and that is why the demand is now made in this House. I am suggesting the proposition with my own feeble voice, and I am going out to the country to talk in the same way. I will make this problem one of the main issues, and associate with it, perhaps, the tariff issue in my district. I know of no other two issues equal to the railway policy and the question of a sound, sane fiscal policy, based on economy as well as protection of native industry. I leave the question where the responsibility lies, at the doors of this government and of this parliament, and I will ask them to state their policy to the country on the issues that I present here to-night. If they fail to provide a remedy for the present condition the responsibility is on them. I hope to see men come back to this House who will deal with the question from the point of view I present to-night.


Robert Forke: That there be added to section 4 the following:
Provided that nothing herein or in this act contained shall in any way affect the pending litigation between the government of Manitoba and the Canadian Northern Railway Company arising out of the agreement between the said province and the said company dated 11th February, 1901, confirmed by chapter 39 of the Statutes of Manitoba, 1901, or any right or obligation of the parties thereto, or either of them, expressed in the said agreement and the said statutes.
He said:	I will say a few words in explanation of this amendment.


Mr. STEVENS:: Does my hon. friend intend this as an amendment to the amendment of the minister?


Robert Forke: It might be put as an
addition.


Henry Lumley Drayton: As another
clause.


Robert Forke: Yes, it would be another
clause added to section 4. In explanation I might say that in the year 1903 the provincial government of Manitoba made a contract with the Canadian Northern Railway. That government guaranteed the bonds of the railway company to the extent of $20,000 per mile for 290 miles from the Manitoba boundary to Fort William and Port Arthur. They also gave guarantees to the extent of $10,000 per mile for other lines within the province, and an option to purchase what was then known as the Northern Pacific system in Manitoba. The railway gave a covenant in return for this guarantee that the Lieutenant Governor of Manitoba should have the right to fix 
rates on the company's line in Manitoba to Fort William and Port Arthur, and from all points in the province to other points in the province. The company covenanted not to charge passenger or freight rates higher than the rates so fixed. The Manitoba government discharged its obligations. This legislation was transmitted to the Secretary of State at Ottawa. As is well known, perhaps, it has been argued that this agreement was abrogated at a later date by Dominion legislation. This has been contested by the province of Manitoba, and, as perhaps the House is aware, the decision of the Supreme court was given against the province recently. The province has now appealed to the Judicial Committee of the Privy Council. That action is still pending. The decision has not yet been given, and according to the way in which section 4 is worded, if this amendment is not earned, even suppose the decision of the Privy Council were in favour of the province, they would not be able to reap any benefit from that decision. They would not be able to have the advantage of those rates. All they would be able to get -would be that they would have to pay the bill of expenses. If this amendment is added to this clause and it so turns out that the decision is in favour of the province oi Manitoba, then they will have the advantage for which they have paid in the years gone by. This does not otherwise injure the bill in any way. It is simply a proviso added to this clause of the bill.


George Perry Graham: The leader of the Progressive party (Mr. Forke) has forsaken the Crowsnest pass agreement, and he is now going to rely upon a Manitoba agreement in place of it.
Mr, FORKE:	You are wiping out the
agreements.


George Perry Graham: Not at all. So far as the Canadian Northern was concerned in the Manitoba agreement, that was to assist the movement of grain, flour, and so forth. The committee will, I think, realize with me that one of the objects of this bill is to wipe out, not litigation, but a judgment of the Supreme court which was given restricting the territory which comes under the Crowsnest pass agreement to points on the Canadian Pacific line in existence in 1897. The Supreme court on a question submitted to them in connection with the rates question a few weeks ago, decided that that territory was restricted to the limits existing in 1897. In order to protect the western people in what we think are their rights, we are not only interfering with litigation, but wiping out a judgment of the

Railway Freight Rates
Supreme court given only a few weeks ago. By doing that, we are taking away from the railways the right to appeal to the Judicial Committee of the Privy Council, which appeal they were prepared to make had it not been for this legislation. We are interfering, not only with litigation, but with judgments, and that being the case, I submit that this committee, if this amendment is carried, would really be going back on the whole intent of this bill, which is to straighten out all these difficulties and make plain sailing for an equalization of rates. The question of the Manitoba agreement was brought before the Board of Railway Commissioners and it was decided against that province. An appeal which was made on a matter of law to the Supreme court, was decided against the province of Manitoba in that court. I think I speak advisedly when I say that there are very few legal men in the Dominion of Canada who have any idea that Manitoba can hope to succeed before the Judicial Committee of the Privy Council.


Robert Forke: Why take away the opportunity?


George Perry Graham: Because this legislation is to take out of litigation this whole freight rate question and to place it on a basis where it can be handled by the Board of Railway Commissioners. As the object of the bill is to get rid of litigation and, further, to override a decision of the Supreme court, I am sure hon. gentlemen will not ex-, pect the government to accept an amendment which overrides the whole principle of the bill.


Henry Lumley Drayton: I would ask my hon. friend to reconsider that question, looking at it from this standpoint. I am familiar with the agreement. The matter came before me when I was on the Board of Railway Commissioners, and the application of the agreement was considered by that board. I did not give effect to it, and at that time I believe I gave leave to appeal to the Supreme court. I should like my hon. friend to consider the question in this way which seems to me to be the fair way. We are not parties to that agreement. I do not know that I insist anything we are doing in this legislation is going to change that agreement-


Robert Forke: I do not see it does.


Henry Lumley Drayton: -but I think the committee ought to consider carefully whether, in connection with a bill which, on its face, deals merely with difficulties arising under the Crowsnest pass agreement, we
should take away any right which may exist to the province of Manitoba as a result of their own agreements. It might be that if the province got what it wanted, it would .be like the boy that got hold of a bear, but the people of that province do not think so. They think they have a legal right. Our usual practice is not to interfere with rights subject to litigation. This litigation is actually going on, and I would submit to my hon. friend that the litigation might just as well go on and the usual rule be applied, that is that parliament, in its legislation, does not interfere with pending litigation.


George Perry Graham: I do not see the matter in that way at all. This bill is a bold piece of legislation in order to get rid, not only of the Crowsnest pass agreement, but of a score of agreements of more or less importance. Now, we are asked to pick out one special agreement, which my hon. friend, as chairman of the Board of Railw'ay Commissioners, has ruled against, and as regards which the Supreme court has upheld him in his judgment, and we are asked to suspend that because an appeal has been made to the judicial Committee of the Privy Council. If we do that, then I do not think we . have any right to take away from the railways their right to appeal to the Judicial Committee of the Privy Council, and we are doing that definitely in this bill. Why not let us get the rate situation cleared away and not surround the Board of Railway Commissioners with any more restrictions than we can avoid? If we do what the hon. member suggests, the case can be dangled before the Judicial Committee of the Privy Council for two or three years, and equalization of railway rates in Canada cannot start until that litigation is over.


Robert Forke: Does the minister think it
would not be worth fighting for, supposing the Privy Council decided in favour of Manitoba?


George Perry Graham: I do not think so. I still
maintain that if we do this we are making a great mistake; we are nullifying our whole action of the past three days in trying to get rid of a number of agreements-and we have a number of agreements on the Intercolonial, some of small importance, some of greater importance-in order to give the Board of Railway Commissioners a fair chance. It is not right to allow litigation in one case to go on and by legislation to prevent other litigants from appealing their oase. 1 never dreamed for a moment that any person would take this stand. Otherwise, this legislation would have been framed altogether differently.
C.N.R.-Branch Lines

Amendment (Mr. Forke) negatived on division.


[Stage Direction]
Section agreed to.
Bill reported.
Hon. GEORGE P. GRAHAM (Minister of Railways and Canals) moved the third reading of Bill No. 181 to amend the Railway Act, 1919.
Motion agreed to on division, and bill read the third time and passed.


[Stage Direction]
Hon. GEORGE P. GRAHAM (Minister of Railways and Canals) moved that the House go into committee on Bill No. 210, respecting the construction of a Canadian National railway line between Sunnybrae and Guysborough, in the province of Nova Scotia.
Motion agreed to and the House went into committee, Mr. Gordon in the chair.
On section 1-Power to construct and complete line described in schedule.
Henry Herbert Stevens: This bill has been before
parliament on and off for about twenty years and I cannot think that the minister is serious in wanting to put it through.


George Perry Graham: The resolution went
through the House the other day and the 'bill was referred to the railway committee and unanimously reported.


Henry Herbert Stevens: Is this one of the bills
which the minister expects to have crucified in the Senate? Honestly, I think we ought to stop this farce of sending a bill to the Senate for the express purpose of having it killed there. I have looked over this 'bill year after year and I must say that I am opposed to it; I regard it as unnecessary and as a mere added expense to the country. I do not think it should be accepted.


[Stage Direction]
Section agreed to.
Bill reported.
Hewitt Bostock: When shall the bill bo
read the third time?


Some hon. MEMBERS:: Now.


Mr. GARDINER:: Next sitting.


Some hon. MEMBERS:: Carried.


Hewitt Bostock: Mr. Graham moves,
seconded iby Mr. King (Kootenay), that

the bill do now pass and that the title be as on the order paper. Is it the pleasure of the House to adopt the motion?


Some hon. MEMBERS:: Carried.


Henry Herbert Stevens: On division.


Hewitt Bostock: I declare the motion
carried on division.


Robert Gardiner: There was a protest
from this corner of the House, Mr. Speaker, to the bill being read at this time.


Hewitt Bostock: If agreeable to the House, it shall -be read at the next sitting. The consent must be unanimous.


Ernest Lapointe: Under the rules, Mr. Speaker, when there is no amendment I submit that the third reading may 'be asked for.


Hewitt Bostock: There being no unanimous consent, I reverse my decision. Is it the pleasure of the House to adopt the motion?


Some hon. MEMBERS:: Carried.


[Stage Direction]
Motion agreed to, bill read the third time and passed.

[Stage Direction]
The House in committee of S-upply, Mr. Gordon in the chair.
Public works-Manitoba, $59,146.26.
Mr. CALDWELL:: I see that in some of
the items in this vote provision is made for local improvement taxes. What does this mean?


Hon. J. H. KING (Kootenay, Minister of Public Works):: We pay local improvement
taxes in connection with the paving of sidewalks and improvements of that character.


Henry Lumley Drayton: The minister
might file with Hansard the usual information as to appropriations not required.


John Warwick King: I will get that
information.


[Stage Direction]
Item agreed to.
Experimental farms-replacements, repairs, improvements, etc., $150,000.
John Warwick King: Mr. Chairman. I move that this item be reduced by $50,000.


[Stage Direction]
Motion agreed to.
Mr. SPENCER:: Why is the reduction
made?

Supply-Public Works


John Warwick King: There is really a
clerical error in the item. We think $100,000 is sufficient for replacements and improvements. The $50,000 for new construction will reappear in the supplementaries.


[Stage Direction]
Item agreed to.
London, England, Canadian office-maintenance, $33,000
Henry Lumley Drayton: With our new
big building there do we want to spent any more on maintenance?


John Warwick King: This is for the
caretaker service.


Henry Lumley Drayton: It is about the rental of the other place.


[Stage Direction]
Item agreed to.
Military buildings-repairs, fittings, alterations and additions, $50,000.
Henry Elvins Spencer: How much of this vote
was spent last year?


John Warwick King: We spent $34,-
821.95. The amounts vary from $131, or even less, up to $14,626.


Henry Elvins Spencer: Why does the minister
think he will need $50,000 this year?


John Warwick King: We are requested by the Deputy Minister of National Defence, in a communication dated October 19, 1924, to provide for various items amounting to $71,000.


[Stage Direction]
Item agreed to.
Military hospitals-repairs and improvements, $50,000.
William Charles Good: What is the explanation for the increase of $25,000?


John Warwick King: This is required
for repairs and improvements to various military hospital buildings at Ste. Anne de Bellevue, Halifax, Toronto, London (Ont.), Winnipeg, Calgary, and Vancouver. These buildings are more or less of a temporary nature and are likely to require more repairs each year. I had the privilege of visiting the Christie street hospital in Toronto, and there is no doubt that extensive repairs are required to keep the buildings habitable.


William Charles Good: Will these hospital buildings
need more and more repairs each year?


John Warwick King: They are not
permanent buildings and their upkeep will be more or less expensive.


William Charles Good: : How long will these hospitals be needed?


John Warwick King: If I remember
rightly, the minister (Mr. Beland) advised the
House that the use of these hospitals would continue for a number of years yet.


[Stage Direction]
Item agreed to.
Ottawa public buildings and grounds-water, $53,000.
Thomas Wakem Caldwell: Why this increase of
$8,000?


John Warwick King: The water is
metred and we pay so much per thousand gallons. Each year there is an adjustment of the account. Last year we overran the appropriation.


Thomas Wakem Caldwell: It looks as if we were
increasing our payments to the city of Ottawa in all directions. I would think that with the advent of 4.4 there would not be so much water used in the public buildings.


John Warwick King: That is not
allowed in the public service.


Thomas Wakem Caldwell: Possibly 4.4 induces a greater thirst. Anyway, I think we are dealing pretty liberally with the city.


[Stage Direction]
Item agreed to.
Elevator attendants, $72,000.
Thomas Wakem Caldwell: How many elevator
attendants have we, and how many of them are on full time?


John Warwick King: Sixty-nine.


Thomas Wakem Caldwell: How many elevators do they operate, and does this item include the House of Commons elevator service?


John Warwick King: About thirty in
all. This does not include the sessional service.


Thomas Wakem Caldwell: How many hours a day do these attendants work?


John Warwick King: Eight hours.


[Stage Direction]
Item agreed to.
Lighting, including roads and bridges, $82,000.
Thomas Wakem Caldwell: Where is this lighting done? In what part of the city?


John Warwick King: All the buildings in Ottawa, the grounds and a certain number of the streets.


Thomas Wakem Caldwell: Are your lights paid for on the meter system?


John Warwick King: Yes.


Mr. LEADER:: Why are the lights on in the day time? We often come up here in the day time and find them on.


John Warwick King: For testing purposes.
Supply-Public Works


Robert Gardiner: For the lighting of what streets do we pay?


John Warwick King: For Wellington
street, the bridges on Laurier avenue and Connaught place and Major Hill park.


Mr. COOTE:: Is Wellington street the
property of the government?


John Warwick King: Yes. From Connaught place down to the old Perley home is under the control of the government.


George Gibson Coote: I should like to suggest to the minister that he place some police on Wellington street so that it would not be so dangerous to cross there. ' I think it is the most dangerous street to cross in the city of Ottawa. I had the matter brought to my attention by different parties in the city, and from personal experience I would rather cross any other street in Ottawa than Wellington street, We have so many policemen around this building and the grounds here that surely we could have an officer placed on Wellington street in front of the parliament buildings to direct the traffic there and make it safe for people to cross the street without incurring the danger of being run down every time they cross.


John Warwick King: I am making
inquiries now into the matter. I think the situation is due to the fact that cars are parked on both sides of the street. I think that next year we should make a regulation,- I have the matter in mind,-that during the session at least there should be no cars parked in front of the parliament buildings.


Thomas Wakem Caldwell: I was just going to raise that question. I have gone out very often when there was just room to get between the cars. The driver of a car coming along the street will not see a person coming out of the grounds, and a person coming out of the grounds will not see the cars approaching. It is a very dangerous situation.


George Gibson Coote: Before the item carries I
should like to say that I think we need more protection than has been suggested. I think we need a policeman there to regulate the speed at which these cars go by. There are no cross streets intersecting Wellington street in front of the parliament buildings, and lots of these cars go by at the rate of thirty miles an hour. They pay no respect to the centre line of the street, they take any side at all, and persons crossing Wellington street to get to the parliament buildings really endanger their own lives. I think this government could easily afford to place one of our mounted 
policemen on this street and if necessary stop these cars once in a while in order to enable people to cross in safety.


John Warwick King: I will be very
glad to give consideration to what my hon. friend has said.


Thomas Wakem Caldwell: Either that or have a few trenches dug across .so that the cars would not be able to go so fast.


Robert Gardiner: Is the government
responsible for the paving of that part of the street also?


John Warwick King: Yes.


[Stage Direction]
Item agreed to.
Heating, including salaries of engineers, firemen and watchmen, $380,000.
Thomas Wakem Caldwell: This is for the heating of the government buildings in Ottawa I presume.


John Warwick King: Yes, and for the
salaries of engineers, firemen and watchmen in Ottawa,


Thomas Wakem Caldwell: Is the heating' of the
government buildings in Ottawa done from a central plant?


John Warwick King: No, not all.


Thomas Wakem Caldwell: If not, has the government ever considered the advisability of heating all the government buildings from a central heating plant?


John Warwick King: I doubt if that
would be economical considering where the buildings .are located and the fact that some of them are across the canal. The heating plant we have serves this building, the east and west block, the Langevin block, the Post office, the Supreme court and the Census building.


Mr. SPEAKMAN:: Does this item include
the cost of the coal used?


John Warwick King: Yes.


Alfred Speakman: What class of coal is
used? Is it the ordinary American coal?


John Warwick King: No, we are using
Canadian coal, run of mine and slack.


George Gibson Coote: At what price per ton?


John Warwick King: It varies. This
year the price is about S6.40 for slack.


George Gibson Coote: Is the coal purchased by
tender?


John Warwick King: Yes, by tender.
JtJNE 18, 1925
Supply-Public Works


Robert Gardiner: Where did we get our
supplies from this year?


John Warwick King: We have not
made a contract as yet. Last year the coal was supplied from Minto Mines in New Brunswick.


Robert Gardiner: What do we pay for
run of mine coal?


John Warwick King: Seven dollars.


Robert Gardiner: Is that laid down in
Ottawa?


John Warwick King: Yes.


[Stage Direction]
Item agreed to.
Departments generally-char service including $100 to E. Snowdon for firing noon gun, $385,000.
Thomas Wakem Caldwell: Is this noon gun fired
all the year round?


John Warwick King: Yes.


Thomas Wakem Caldwell: On Sundays also?


John Warwick King: I think so.


Robert Gardiner: What does it cost per
charge of powder to fire the gun?


John Warwick King: I have not that
information.


Robert Gardiner: I should like to get it.


Thomas Wakem Caldwell: Has this man, Snowdon,
ever appealed to the government for a raise in pay?


John Warwick King: I have not heard of it.


Thomas Wakem Caldwell: He is certainly very
modest.


[Stage Direction]
Item agreed to.
Repairs, improvements, additions and maintenance, 8650,000?
George Gibson Coote: Would the minister give
us some particulars as to how he intends to spend this amount? Is there anything included in it for the tovter?


John Warwick King: This amount of
$650,000 is required for the following purposes :
1 Carrying out works of repairs, alterations, additions and improvements, and procuring furniture, fittings and other supplies, in connection with the maintenance of Ottawa public buildings.
2. The removal of snow and ice from sidewalks and roads around the department blocks, parliament house and repairing and maintaining and cleaning during summer months, the pavements and sidewalks *on
' Wellington street and government area" to the north, the Plaza, Laurier avenue bridge, St. Patrick street in front of Printing Bureau, McKenzie avenue, sidewalks on Laurier avenue west and Elgin street fronting Cartier sauare, and all laneways, yards, and areas adjoining properties rented, or owned and occupied by the Dominion government.
3. Keeping the grounds surrounding the Dominion buildings in Ottawa in proper condition.


Robert Gardiner: How much is there included in this vote for the purposes of the tower?


John Warwick King: This has no reference to the tower. The vote for the tower will be in the capital expenditure.


Alfred Speakman: How many buildings
are now utilized by the government in this city?


John Warwick King: I will come to that very shortly, under "rents and repairs". At present I have not the details in front of me.


[Stage Direction]
Item agreed to.
Telephone service, 595,000.
Mr. KENNEDY (Glengarry and Stormont) :: Whait is the reason for the increase here?


John Warwick King: This amount is required for the payment in the fiscal year 1925-26 of the rental of the Bell Telephone Company's 'connections throughout the several departments of the government in the city of Ottawa. The increase of $2,000 is due to" the following: An increase of 74 in the number of telephones at a coat of $1,894.20; and, an increase in the cost of P.B.N. equipment, $262.68, making a .total of $2,000.


Donald MacBeth Kennedy: We had a discussion of this last year or the year before, and I understood that on account of the introduction of a new block system there was going to foe quite an economy effected. Has there been 'any saving?


John Warwick King: Yes, these phones would have cost us more if we had not put in that equipment.


Donald MacBeth Kennedy: What was it costing us two years ago?


John Warwick King: We had not the same number of iphones two years ago. This has Caused an increased expenditure.
Mr. 'CALDWELL: Was that the improvement that has been effected?


Robert Gardiner: On what basis do we pay for this telephone service, so much per phone?
Supply-Public Works


John Warwick King: Yes. Under the old arrangement it would have cost us $55 per .phone per year, and under the P.B.X system is costs us $15 per phone per year.


[Stage Direction]
Item agreed to.
Dominion immigration buildings-repairs, improvements, additions, furniture, etc., $25,000.
Mr. KELLNER:: How does the minister get that vote in for immigration buildings? We 'have already passed an item for repairs for nearly every place that has an immigration shed or building.


John Warwick King: We have immigration buildings all over the Dominion, and this is for their maintenance and repair. We had an. item a few moments agio with respect to the immigration building in Winnipeg. That was an unknown quantity, and the architect placed that amount in the estimates to be voted directly by parliament. The present vote is like our harbours and rivers vote. It is a general vote to take care of any repairs that may be required during the year.
Item agreed1 to.
Fittings, general supplies and furniture, $125,000.


Thomas Wakem Caldwell: There is an increase of $25,000 here. Why is that?


John Warwick King: This appropriation is $25,000 more than for 1924-1925 because it was found that the amount of $100,000 was insufficient to meet the demands. This appropriation was exhausted at the end of December, 1924, with the result that the requirements for the last three months have been unprovided for. In 1914-15, $160,000 was voted under this item, and $90,000 expended. The amount runs .from that up to as high as $145,000 per year.


Robert Gardiner: What system is used
in buying these supplies? Is it by contract?


John Warwick King: Yes, by tender.


Donald MacBeth Kennedy: What has
happened to the Purchasing Commission that used to buy all the supplies for the government?


John Warwick King: The Department
of Public Works have a staff who do their purchasing. There is a secretary of the commission who reports to council through the responsible minister, and keeps track of these purchases.


Donald MacBeth Kennedy: It is done
through the department only?


John Warwick King: Yes.


Thomas Wakem Caldwell: Is any departmental
furniture made in the penitentiaries?


John Warwick King: I think we have bought some tables and chairs and brooms from the penitentiaries.


Thomas Wakem Caldwell: Does not the government think it would be a good plan to have all the furniture for the departments made in the penitentiaries?


John Warwick King: I think that question has been under consideration.


Thomas Wakem Caldwell: I think it has been
suggested from time immemorial that the inmates of the penitentiaries should be given more work, that they should be self-sustaining, that that would help towards defraying the big expenditure on account of the penitentiaries. I think sufficient work should be given to enable the inmates to be kept busy. Furniture making is an occupation that a man can learn pretty quickly. It is not very technical, and I think the government would be well advised to have all the furniture for all the departments made in the penitentiaries.


John Warwick King: The Penitentiaries ' branch have an agent who is in and out of the departments all the time, and we do buy a certain amount from the penitentiaries, but not exclusively from them.


Thomas Wakem Caldwell: The penitentiaries
make furniture, and why do not the departments get all their furniture supplies from them?


John Warwick King: That is an old
question. It has been discussed many times, but there are difficulties in the way.


Mr. POWER:: Why don't they grow
potatoes and wheat to?


Thomas Wakem Caldwell: There is nothing to
prevent them growing potatoes, although I might say that the more potatoes they grew within the last year or two, the further they would be in debt. I would rather see them working at something there was money in.


Charles A. Stewart: We are
buying more than we used to from the penitentiaries.


Thomas Wakem Caldwell: I am convinced that it is through pressure from firms who are manufacturing furniture that the government do not buy more furniture from the penitentiaries.


John Warwick King: There are some
styles of furniture they can make in the peni-

Supply-Public 'Works
tentiaries, but generally speaking they could not fill many of the requirements of the government.


Thomas Wakem Caldwell: What percentage of the government's furniture is manufactured in the penitentiaries?


John Warwick King: I have not that
information, but I know there has been a tendency in recent years to give more of this work to the penitentiaries.


Mr. BROWN:: I think the policy should be pursued of making all these institutions as nearly self-supporting as possible. The hon. gentleman across the way asked, why do these institutions not grow potatoes and wheat.
I can only say they do.


Charles Gavan Power: For themselves.


John Livingstone Brown: Not only for themselves.
The asylum at Brandon I know has a very expert hog raiser in charge, and he takes car after car of hogs and sells them on the Winnipeg market in competition with the farmers' hogs. I am not objecting to that. Nobody is complaining about it, but when the question is put up to us, why don't they grow potatoes and wheat, I simply say they do. These institutions should all grow as much as possible of the vegetables and the food that they need. I think it is only a matter of sound public policy that that should be done. These institutions are necessary for taking care of various classes in the community, some who are insane, some who are morally derelict and have to be taken under the law, and this is a burden which the country necessarily has to bear, but the support of these institutions should not be made an occasion for furnishing other people with the opportunity to sell their supplies. I think these institutions as much as possible might be used not only to provide for themselves but to provide for the heeds of the government. I know there are objections, but personally I have none to allowing the output of these institutions to be put on the market under fair competition, not cut-throat competition, with the products of free labour. There is no reason why, because men have had to be taken care of by the state they should be deprived of the opportunity of earning something-


Charles Gavan Power: How could my hon. friend
establish fair competition in the matter of wages?


John Livingstone Brown: By selling at even prices
with the products of free labour. I think we can pursue much further than we have done
the policy of making all these institutions self-supporting.


Thomas Wakem Caldwell: The fact that the institution called the penitentiary is making supplies for the government is not on a par with a case where an institution is manufacturing for sale in the open market. This is simply one department under government control. It is one of the government institutions and I do not see any good reason why the manufacturer of any article should object to the government having one department under their care manufacturing goods which they need in some of their departments. That is not manufacturing articles to be placed in the open market in competition with the products of other manufacturers. If the goods were to be placed in 'the open market some objection might legitimately be made. I do not think they have a strong case-in fact I do not think they have any case at all- when they object to the penitentiaries manufacturing anything they can produce for the government's own use. That is common sense, sound policy and fair and right to everybody.
I do not think it is fair to the taxpayers to make them pay taxes to maintain an institution that can maintain itself by manufacturing goods needed in some other department of the government.


[Stage Direction]
Item agreed to.
Heating, $420,000.
George Gibson Coote: Does this cover the heating
for all Dominion public buildings?


John Warwick King: Yes, outside of
Ottawa.


George Gibson Coote: Could the minister explain
this item to us? I have been looking at the next item, which is heating. The bill for lighting seems to be very excessive.


John Warwick King: I think not. This amount is required for the purchase of fuel. It costs more to heat a home or a house than to light it, and I think this is probably just about right. Our coal supplies are bought carefully by tender, and I think the charges are reasonable.


George Gibson Coote: Coal is all bought by
tender?


John Warwick King: Yes.


Thomas Wakem Caldwell: If I had any criticism
to offer to the lighting bill, I would say that it was excessive as compared with the cost of heating. I should not imagine it would cost fifty per cent as much to light the

Supply-Public Works

building as to heat it, especially in the cold weather, where you have to heat your buildings all day. In the summer you require very little light, especially when we have daylight saving. We do not need nearly so much light now as in the winter. That is probably one of the excuses in favour of daylight saving.


John Warwick King: This is in addition to electric current. Lighting would also cover the cost of lamps used throughout the service.


Thomas Wakem Caldwell: I suppose the heating
covers cost of repairs to furnaces and so on.


John Warwick King: No.


Thomas Wakem Caldwell: Does it include janitors?


John Warwick King: No, not the
janitors.


Thomas Wakem Caldwell: What does it include
besides coal?


John Warwick King: There were
36,500 tons of coal required and purchased. Wood is also required for various buildings. Then we have the removal of ashes, the supply of heating gas, steam heating and fuel oil.


Thomas Wakem Caldwell: Does it include the
firemen?


John Warwick King: No, it is for the
purchase of fuel of various kinds and the removal of ashes.


Thomas Wakem Caldwell: Under what head do
the firemen of buildings come?


John Warwick King: Next item, salaries of caretakers, engineers, firemen and so on.


Thomas Wakem Caldwell: This item would indicate that it included all the cost of heating. Evidently this does not. This should be called cost of fuel, instead of heating.


John Warwick King: Yes, fuel or
neating.


[Stage Direction]
Item agreed to.
Light, $207,000.
George Gibson Coote: This is the item I was drawing the minister's attention to. It seem3 to me this amount is excessive compared to the cost of heating the buildings. Take the buildings in Ottawa; the lighting is less than one-fourth of the amount of the heating. Possibly the minister has some explanation of the high cost of lighting.


John Warwick King: 
George Gibson Coote: How many buildings are
there?


John Warwick King: There are four
hundred and sixty-three.


Robert Gardiner: Are they all outside of
Ottawa?


John Warwick King: Yes.


George Gibson Coote: It must cost $700 on an
average for each building.


John Warwick King: The cost varies
very much.


George Gibson Coote: It seems to me a very excessive charge for lighting.


Robert Forke: The trouble with a lot of
public buildings is that they require to have light night and day. The Brandon asylum is a magnificent building in many respects. At one time an expert came over from the United States to inspect the buildings up there, and he found this building was quite adequate in every way, except in regard to lighting. He said the building should not have required as much electric lighting as it was found necessary to consume there. In a great many corridors they burn the light twenty-four hours a day.


John Warwick King: That is true in
most of the city buildings.


Robert Forke: I am no architect, but it
seems to me the great weakness in many public buildings is that they are not adequately lighted from the outside.


George Gibson Coote: I would suggest that in many cases they pull up the blinds and let in the light.


Mr. BOYS:: Is the light supplied by meter?

Supply-Public Works


John Warwick King: Yes.


William Alves Boys: Is there anyone who supervises the buildings and sees that the lights are turned out in the day time?


John Warwick King: Oh yes.


William Alves Boys: I have seen the lights burning
in the parliament buildings all day.


John Warwick King: Not all day.


William Alves Boys: For very many hours in the
morning, in broad daylight, the lights are burning. Of course the minister is not to blame for that.


John Warwick King: I noticed it the
other morning myself. The same complaint was brought to my attention early in the session, but they tell me that at certain times of the day the electrician, in charge of what they call the white way makes his test, turns on the lights and goes over the circuit. They do the same thing in other places.


William Alves Boys: My apartment is right in front of the buildings and I observe the situation with great regularity. It is a common thing for all these lights to blaze away in broad daylight. Whoever has the supervision of this matter should exercise more care, particularly when we are paying for lights by meter. There are hundreds of lights which there is no occasion to bum.


John Warwick King: The matter has
recently been brought to the attention of the department.


Harry Leader: I have inquired why the
lights were burning in the day time. I have noticed them lighted in the morning. They were burning at three o'clock this afternoon.


[Stage Direction]
Item agreed to.
Power for running elevators, stamp cancelling machines et cetera, $80,000.
George Gibson Coote: What is the reason for the
increase in this item?


John Warwick King: The increase of $4,000 in this appropriation is due to provision haVing to be made in 1925-26 for the following buildings which previously had not to be provided for:
Montreal post office, station "G", (Lavut building).
Grain inspector's office, Montreal.
Hamilton post office, station "C".
Winnipeg post office, station "A".
Calgary Southam building.
Ottawa new workshop building.
Kentville, N.S., experimental farm.
Fredericton, N.B., experimental farm.
Lennoxville. Quebec, experimental farm.
Swift Current, Sask., experimental farm.
Lacombe Alberta, experimental farm.
Sydney B.C., experimental farm.
287-V


George Gibson Coote: Is there not some overlapping here between the Department of Agriculture and the Department of Public Works, if the latter department has to supply power on these farms?


John Warwick King: We have charge of their buildings in that regard. There is no overlapping.


George Gibson Coote: Would this item be for power supplied by municipalities to the farms?


John Warwick King: We would make the contracts for the power.


George Gibson Coote: The bills would be paid
through the Department of Public Works.


John Warwick King: From this vote.


George Gibson Coote: They would not appear then in the vote for experimental farms.


John Warwick King: No.


[Stage Direction]
Item agreed to.
Rents, Jl,410,000.
Mr. BOY'S: This is a very large item, and I think we ought to have some explanation When is the day going to arrive when we shall use the lands that have been purchased along the river front and get rid of all these rented buildings? Would the minister give us a list of the buildings and the rentals paid for each in the city of Ottawa, that is those the rent of which exceeds $20,000 a year?
John Warwick King: They are as
follows:	.
Post Office and Interior, Union Bank
building	 66,000
Transportation building	 42,000
Jackson building, Immigration	 32,000
Customs and Health, Elgin annex	 31,000
Canadian Woods building	 97,000
Labelie building	 24,000
Norlite Building, Interior department..	..	30,000Central Station, Railway Commission..	..	21,356
Those are all the larger items over $20,000.


George Gibson Coote: Would the minister give us a little information regarding the property which the government owns on Wellington street, how far it extends and the depth of the property?


John Warwick King: West of the West block, the property extends on the north side of the street down to the end of what is known as the Perley bouse, that is practically the turn, and then north to the river, about four blocks.


George Gibson Coote: Has the government any intention of putting up some buildings on that property this year for the government service?
Supply-Public Works


John Warwick King: The department have in the office plans prepared and the layout developed. It is a question when it will be advisable to come to parliament and ask for money. Prior to the present time the government have not felt they would be justified in undertaking a large building project.


George Gibson Coote: Approximately what amount would be involved to put up the buildings?


John Warwick King: About $15,000,000. That is to develop what they have in mind. That would mean six or seven departmental buildings. That is the project that is proposed. It is not proposed just now.


Robert Forke: Does the minister not think $1,410,000 of rental would go a long way towards covering the capitalization?


John Warwick King: There is the
capital investment and the maintenance. As a matter of fact, I do not think any money would be saved in that way. It will cost you more to own your own buildings.


Robert Forke: These rented buildings are
heated?


John Warwick King: Yes. That varies. Some of them we heat. It depends on the contract we make.


Leland Payson Bancroft: I hope the minister
will have the Hudson Bay railway finished before he commences erecting those buildings.
Mr. KENNEDY- (Glengarry):	How are
the rents calculated?


John Warwick King: On the floor space. The rentals vary here from forty cents to $1.05 a square foot.


Donald MacBeth Kennedy: Do they vary according to the party from whom the property is rented?


John Warwick King: No. According
to location, use and character of the building.


William Alves Boys: The minister has mentioned
a complete programme of providing buildings for several departments on the river front involving an expenditure of some $15,000,000. The rental paid now is about five per cent on $30,000,000. If that be so, I do not quite see why the minister thinks it is proper economy to continue renting. It would seem to me to be economy to use the land we have in that way. Are these long-term leases?


John Warwick King: No.
IMr. Coote.l


William Alves Boys: Have the leases a clause by
which they may be terminated in case the government desired to use the water front?


John Warwick King: There are no very long-term leases. They vary from one, three to five years.


William Alves Boys: Without any right to terminate before that?


John Warwick King: No.


William Alves Boys: Would it not be wise, in connection with leases that are being put through, to have a clause enabling the government to terminate them in case the government wanted to carry out this project?


John Warwick King: There would be
no great difficulty in that regard. If the government decided on a building project, it would take from two to three years probably to carry it out, and during that time the leases could be so arranged that they would fall due about the time the building was completed. The leases are not for long terms, and they are falling due at irregular intervals.


Arthur Meighen: How is it that with
rents going down in the city and very considerable areas in office buildings vacant, the rent the government is paying is going up?


John Warwick King: I do not think
it is going up. Generally speaking, there has been a reduction in rentals.


Arthur Meighen: Where is he reducing
them?


John Warwick King: This vote shews
a reduction of $40,000.


Arthur Meighen: That may be because
there are departments that are closing up. Will the minister mention one block of considerable size in Ottawa where the rents are reduced?


John Warwick King: Rents are very
low in Ottawa. There have been no increases that I know of.


Arthur Meighen: The minister was not
here when we were attacked fore and aft for paying too high rents; but this government has increased them while rents generally have been diminishing.


John Warwick King: Where did we
increase them?


Arthur Meighen: In the city; I have in
mind a block which I need not mention.


John Warwick King: I do not know
of any increases.

Supply-Public Works


Arthur Meighen: I have been so advised,
and I think the minister will find that it is a fact.


John Warwick King: Our rentals in
Ottawa are low in comparison with those of other places.


Arthur Meighen: And they were low before; but they have been raised in one or two instances while in no case have they been reduced.


Thomas Wakem Caldwell: Is this just for buildings in Ottawa or does it include buildings throughout the country?	.


John Warwick King: Throughout the
country.


Arthur Meighen: The minister might
make a statement as to where certain valuable paintings are now housed, and how they are being taken care of. I refer particularly to those very precious records of the war in the way of paintings which have been donated to this country. What arrangement has been made as respects these, and how does the government propose to place them for the admiration of the Canadian people, as they should be placed?


John Warwick King: The paintings referred to are being cared for at the National Museum. It is hoped that some day we shall have a suitable building in which to display them, but so far the government has not thought it advisable to construct a building especially for that purpose.


Arthur Meighen: I do not think anything should be done in the matter of placing them except with the approval of the donor. It has occurred however to me that possibly7 some of them might properly hang for a time in this magnificent building itself. It seems most unfortunate that they are not being enjoyed by the public of Canada as they should be. Has the minister considered the possibility of so displaying them that the pub-lice may derive the fullest benefit from them?


John Warwick King: There are many
places in this building where the paintings might be hung to advantage. I shall look into this matter.


Arthur Meighen: I am thankful for the
way in which the minister has received the suggestion. In this connection I desire to make a brief statement as to the history of these paintings. I do not think that the fact is as well appreciated as it should be that these paintings now in the possession of this Dominion are due first of all to the resourceful
initiative, the intense ardour for this country, and the generosity of Lord Beaverbrook. Lord Beaverbrook, as we all know, is a Canadian not only by birth but in heart as well; and though I cannot claim any friendship or, indeed, any intimacy with him whatever, I do feel that we owe him a great debt of gratitude for the thoughtfulness he displayed in preserving the records of the war in various forms to be the property and the pride of this Dominion for years to come.
The conflict had not much more than started when he conceived the idea of seeing that an adequate record was kept 'of the activities and the achievements of the Canadian forces in the field; and with characteristic initiative he set about to make himself responsible that this should be done. The eyewitness service owed its origin to him solely, and that service, distinct as it was from the rather dry and formal official records, is today the material, very complete, vivid and reliable, from which the history of the war is being written so far as Canada is concerned. The initial organization was expanded until it embraced all the Canadian units, and it certainly- is not too much to say that no army in the field of all the allied armies was so served in this respect as was Canada.
But what I rose to mention chiefly was the gift- of these paintings. They are considered the best of any of the paintings of the war and I understand that they are of a value approximating one million dollars, and possibly much more than that. Undoubtedly in the future they will be of far greater value. The idea and the execution of it are solely Lord Beaverbrook's. From beginning to end it was simply a work for Canada, and I regret exceedingly that in our time as in the time since its value has not been adequately recognized, nor have the pictures themselves been so placed and used as to give the Canadian people the results which Lord Beaverbrook had a right to expect they would receive. I know that owing to their character there must be a building suited for their display, and I 'earnestly trust that we shall be in a position soon to provide that building for the practical *purposes of demonstration to show to the people of Canada the records of the war in this particular form. I attribute some laxity7 in this respect to the late government. I sincerely hope, however, that in this regard the 'present administration will far excel what we did in relation to these pictures. I make reference to the subject only because I believe that the Canadian people should not lose sight of the real service that was rendered this country by one of her sons, and that he
Sup-ply-Public Works

will always feel that that service has been appreciated as it should be by us all.


[Stage Direction]
Item agreed to.
Yukon public buildings-rents, repairs, fuel, light, watei service and caretakers' salaries, $35,000.
Donald Ferdinand Kellner: What buildings do these
rents cover? From the size of the item one would fancy that there was a good deal of governmental ownership in the Yukon. I think the population is now between seven and eight hundred.


John Warwick King: This is for carrying out improvements in connection with public buildings erected in the Yukon territory, also to provide for fuel, lighting and water during the fiscal year 1925-26. These are the requi remen ts:
Dawson-Administration building-maintenance	$18,861
Dawson-Post Office-maintenance	 836
Dawson-Government House-maintenance.. ..	736
Dawson-Warehouse	and carpenter shop
maintenance	 75
Dawson-Indian agent's office-maintenance..	300
Mayo-Mining recorder's office-maintenance.	1,000
Mayo-Post office-maintenance	 1,000
Mayo-Salaries of agent and accountant.. ..	600
Whitehorse and Carcross-post office	 2,815
Dawson-administration building-repairs to
foundation	 7,700
Contingencies	 1,077
Total	 $35,000


[Stage Direction]
Item agreed to.
Telegraph and telephone lines-land and cable telegraph lines, lower St. Lawrence and Maritime provinces, including working expenses of vessels required for cable service, $218,000.
George Gibson Coote: What is this item for?


John Warwick King: It is required for the fiscal year ending March 31 for the working expenses of the land and cable telegraph lines on the seacoast and islands of the lower river, the gulf of St. Lawrence and the Maritime provinces, including the working expenses of vessels required for cable service.


Thomas Wakem Caldwell: How does the revenue
compare with the expenditure for cable services?


John Warwick King: Not very favourably. These services are in the outlying districts of the St. Lawrence and in parts of Cape Breton and on some islands in the gulf where the population is very small.	.


Thomas Wakem Caldwell: What is the amount
of the revenue?


John Warwick King: The total revenue for the telegraph service in 1920-21 was $330,000; in 1924-25, $293,924.


Robert Gardiner: Is that for the whole
Dominion?


John Warwick King: Yes.


Robert Gardiner: What is the income in regard to this particular item?


John Warwick King: I am sorry I
have not that segregated. I will see that my hon. friend gets the information.


Thomas Wakem Caldwell: Does the government
maintain telephone services throughout any sections of the Maritime provinces?


John Warwick King: Yes, more particularly in Cape Breton.


Thomas Wakem Caldwell: In the section of New
Brunswick where I live we had to form a farmers' telephone company and supply our own line. Later the larger company crowded us out and we had practically to give our line to them. Evidently we are behind the times in our section, or we would have applied to the government for assistance.


[Stage Direction]
Item agreed to.
Saskatchewan, $45,000.
Charles Wallace Stewart: There has
been a good deal of complaint about the slowness in removing from cultivated land the unused poles of the old telegraph line from Qu'-Appelle to Edmonton. How is the work of dismantling progressing?


John Warwick King: As a rule it
would cost probably more to take the poles down than their salvage value.


Robert Forke: Can the farmers get them
for firewood?


John Warwick King: Yes.


[Stage Direction]
Item agreed to.
Alberta, $100,000.
Robert Forke: What is this item for?


John Warwick King: For the working
expenses of telephone and telegraph lines in Alberta during 1925-26. The lines in Alberta consist of 115&i miles of land line, having forty-three offices, of which twenty-one are on salary basis and twenty-two on commission basis. These lines are: Edmontoni-Hudson's Hope line, 774 miles; Onion lake Elk point line 61i miles; Athafoaska-Fort McMurray line, 323 miles.


Robert Forke: Is the money required for
deficits or capital expenditure?


John Warwick King: For line men,
operators' salaries and repairs generally.

Supply-Public Works


John Livingstone Brown: These services generally
speaking are not profitable?


John Warwick King: No.


Thomas Wakem Caldwell: How did the government come to establish telephone systems in some of the provinces?


John Warwick King: You have the
history of the Dawson line with the opening up of the Yukon territory. In Cape Breton for many years there has been a service in the sparsely settled districts.


Thomas Wakem Caldwell: I can understand the
establishment of a line in the Yukon, but not in the settled provinces. When I came here first and began to scan these estimates it was news to me to find this state of affairs. Is there some way of passing these lines over to the local authorities?


Charles A. Stewart: They have
been passed over for the most part, but in the case of Alberta the lines are in the northern sections.


Donald Ferdinand Kellner: Is any portion of it in the Northwest Territories anyway?


Charles A. Stewart: Yes.


Edward Joseph Garland: Has the
government ever considered the possibility of supplying the needs here by radio? There is a sparse population scattered over a wide area, and it has just occurred to me that an extension of the radio service by the department would do away with the necessity for these expensive lines.


John Warwick King: My hon. friend
will understand that radio will give you a service between two points, but you would get no local service through Hudson's Hope. All through this country the settlements are small, and you could not maintain a series of radio stations through these communities to give such a service. That would be out of the question. Nevertheless in the northern sections of Alberta and Saskatchewan the government are charged with the administration, and some means of communication is needed in there so that we may know what is going on in the country.	*


George Gibson Coote: What is the farthest point north to which this telegraph line goes?


John Warwick King: I think the line farthest north is that from Athabaska to Fort McMurray.


George Gibson Coote: I think the minister mentioned Hudson's Hope. Does the line run there?


John Warwick King: Yes, from Edmonton.


George Gibson Coote: Where is Hudson's Hope
situated?


John Warwick King: In British Columbia just over the border, I think.


Neil Haman McTaggart: The government attempted to establish a radio station at Hers-ehell island a year or two ago. Has that experiment been a success?


Charles A. Stewart: That vote is not under the Department of Public Works, it comes through the Department of the Interior. The construction is done and the operation is carried on by the Department of National Defence. The equipment was shipped from the coast last year, I think from Victoria or Vancouver upon the Hudson's Bay steamer which was lost. This year the supplies are going down the Mackenzie river and the post, in all possibility, will be established before the year closes.


Mr CALDWELL:: I am rather interested
in this vote although it is not in my own province. I do not -want to seem to be opposing it at all, but I am asking for information because of the conditions in New Brunswick. There if a subscriber lives more than ten miles from a telephone central he pays one dollar per mile extra for every mile over ten, so that it can be seen what an item it amounts to when that distance is exceeded to any extent. The minister need not be surprised if I come- to him next year and ask for a grant to enable the people who live at a long distance from telephone centres to obtain telephone communication with the outside world, because the absence of these facilities has tended to discourage colonization. We have whole settlements which have been abandoned. As I said if the settler lives more than ten miles from a telephone central he pays one dollar per mile extra for every mile over ten, and in case he needs medical attendance he pays one dollar per mile for doctor's travel.


Charles Gavan Power: In Quebec we built the line ourselves.


Thomas Wakem Caldwell: We do that in New
Brunswick where there are enough in a community. I have helped to build two telephone lines, we got these services by putting our money and energy into the building of them.


George Black: I should like to
call the minister's attention to the fact that this item of $244,500 for the Yukon system
Supply-Public Works

-Ashcroft-Dawson-is a misnomer. Not over S40.000 has anything to do with the Yukon. Formerly it had because the land line of British Columbia was used to connect up with the Yukon. Now that has been disconnected and all telegraphic communication with the Yukon is by wireless. It connects with the wireless station at Dawson and the local line within the territory is used. The annual upkeep of that line is not over $40,000 so this $200,000 should be under the British Columbia system. There is no reason why it should be called "Yukon system" at all.


John Warwick King: I believe the
system has been known as the Ashcroft-Dawson line for many years and under this title the money has been voted by parliament. If there is a misnomer, I do not think it is serious. It is well understood by all where the line goes and what it means. The line was built to serve that section of the country, it has been carried in the estimates in that form, and I cannot see that there is any objection to it.


George Black: I should like to
make it clear to the minister that I am not objecting to the vote. What I am objecting to is the name. I admit that the expense of administering the government of the Yukon in proportion to the population is very large and the items that have necessarily to be spent for that purpose are very large also; but where we see an item of $200,000 charged to the Yukon system which has really nothing to do with the Yukon, it seems necessary to call attention to it. The minister says it is well understood that it does not mean "Yukon" but I venture to say that no one in the House except himself, myself, and the deputy minister understands that. I am sure the general public do not know anything about it. They are only concerned with the idea that it costs such a very large amount of money to administer the Yukon.


[Stage Direction]
Item agreed to.
Grant to the Burrard Inlet Tunnel and Bridge Company towards construction of bridge over the second narrows of Burrard inlet, B.C. being revote of portion of subsidy authorized by statute, chap. 46, sec. 3, 1913. Revote-$100,000-$270,000.
George Gibson Coote: Would the minister explain
why he is going to contribute to the cost of this bridge and give us some information about the proposed expenditure?


John Warwick King: This is for the
construction of a bridge across the second narrows of Burrard inlet. In 1913, I think, parliament made a grant, under the Railway Act, 
of some $350,000 to a private enterprise to assist in the construction of this bridge. That project did not succeed. Later on the municipalities of Vancouver city, North Vancouver city, and the district of North Vancouver and West Vancouver organized themselves into what is known as the Burrard National Tunnel and Bridge Company and have subscribed to this undertaking. They properly, I think, came to the Dominion government and asked if we would assist in the construction of this bridge. We at that time, in 1922, voted $100,000. That vote was repeated in 1924. The province of British Columbia also contributed $120,000 to this undertaking. So it is a municipal, provincial and Dominion government undertaking. When I was west last summer, I was met by a large delegation of men using the channel for the towing of logs and the running of their boats in various lines of trade, and they complained of the fact that a cheap kind of bridge was 'being built, that it was obstructing the natural outlet through the narrows and would cause adverse currents to navigation. The matter seemed to be of a more or less serious nature, and as the undertaking was one in which the smaller municipalities were involved to the extent of their credit, I thought it wise that the matter should be cleared up rather than have the undertaking gone on with and cause probably some damage to the passage way that we require at certain sections of the bridge, and thus lead to a difficult situation. I had a board of engineers go into the whole matter, and they reported that to relieve and improve conditions there should be a further expenditure of $170,000, which would provide for the adding of two spans, 150 feet, north of pier No. 1; to raise the existing piers five feet and approaches, $78,000; dredging, $88,000; and diversion at Seymour creek $33,000. These matters were all taken into consideration and I asked council that we place in the estimates this year $270,000 for this undertaking. .The bridge is an important one. It will give the Canadian National and the Canadian Pacific access to the north shore of Burrard inlet, and will permit of industrial and other development on that shore, giving them the advantage of railway traffic. It will also accommodate pedestrian and vehicular traffic in and out of Vancouver and on to the north shore. The bridge is an important one, as I have already said, and has been endorsed by this parliament to the extent of a grant of SIOO.OOO, and by previous parliaments to the extent of $350,000, when it was a private undertaking.

Supply-Public Works


Henry Herbert Stevens: This item of $270,000 is
really a revote of the subsidy that was passed some years ago?


John Warwick King: Yes.


Arthur John Lewis: What is the cost of the
bridge?


John Warwick King: I think the cost
of the bridge is $1,820,000.


Arthur John Lewis: What part of that amount is the Dominion government liable for?


John Warwick King: We will have
$270,000 in the structure if this vote is passed.


George Gibson Coote: Has any money been paid to the company 'before this?


John Warwick King: No, we have not
paid anything.


George Gibson Coote: Just on what principle is
the Dorhinion government called upon to contribute to this bridge? Is it not a municipal affair?


John Warwick King: It is more than a municipal affair. It is of great interest to the Canadian National Railway, and is of interest to the harbour commission in Vancouver. It will give them a larger area and better terminals than they now have.


George Gibson Coote: What other bridges in Canada do we contribute to the building of?


John Warwick King: We contribute to
all the bridges over canals, and to interprovincial bridges in the provinces.


Thomas Wakem Caldwell: To interprovincial
bridges?


John Warwick King: Yes, to the two
bridges across the Ottawa river, for instance, and other bridges in Ontario and Quebec and other provinces. We also contribute to international bridges. For instance, the international bridges in New Brunswick, between Edmundston and Van Buren, which was constructed by the state of Maine and the federal government.


George Gibson Coote: But this is neither an interprovincial nor an international bridge, and I was trying to find out why the Dominion government should be putting $270,000 into it.


John Warwick King: The first commitment was made under the Railway Act as a railway proposition. The bridge company now are providing for a railway service, and will make it possible for the Canadian
National-and this is our direct interest- and other railways entering Vancouver to have access to the north shore.


Robert Gardiner: Are the railway companies contributing to the cost of construction?


John Warwick King: No.


Robert Gardiner: Yet they are going to
have the use of it. Will they pay any tolls?


John Warwick King: Yes, there will be a rental charge.


Robert Gardiner: Who will be the ultimate owners of this bridge, the municipalities or the Dominion government?


John Warwick King: The municipalities.


George Gibson Coote: We will have nothing to say about it?


John Warwick King: No.


George Gibson Coote: Will the tolls collected on
this bridge be sufficient to take care of its maintenance?


John Warwick King: It is difficult to
say. There will be a very considerable sum of money collected in tolls. There is a tremendous traffic, motor traffic particularly, to the north shore especially in the 12 m. summer season. It leads up into a section that is very popular, and I have no doubt the tolls will amount to a very considerable sum. The bridge company are of the opinion that the tolls will take care not only of the maintenance, but will assist in wiping out the principal expenditure.


Donald Ferdinand Kellner: What obligation is the
government of the day committed to under that clause in the Railway Act which the minister mentioned a moment ago?


John Warwick King: The commitment was made by parliament under the Railway Act. It was decided to subsidize a bridge of this character under railway charter. The railway was known as the Westminster-Yukon railway, and the subsidy granted at that time was $350,000.


Edward Joseph Garland: I want to
get this clearly if I can. The federal government undertakes to contribute to the construction of that bridge a certain amount. When the construction is completed the bridge is then turned over to the municipalities. The municipalities will then have the right to assess the tolls. Is that correct?


John Warwick King: Yes.
Supply-Public Works


Edward Joseph Garland: But no
revenue from those tolls will come back to the Dominion government?
Mr, KING (Kootenay):	No.


Edward Joseph Garland: Then we
are making an absolute gift.


John Warwick King: It is purely a
subsidy.


Robert Gardiner: When this item was
first placed in the estimates, was it for the purpose of subsidizing the railway at that time?


John Warwick King: It was a bridge to be built by the railway company.


Robert Gardiner: What company?


John Warwick King: The New Westminster and Yukon Railway, I think is the name.


Henry Herbert Stevens: Yes, and then on the
renewal of the subsidy, under the chapter in the statutes which is referred to here, it was granted to the Burrard Inlet Bridge and Tunnel Company, which is an incorporated body made up of the municipalities of North Vancouver, Barnet and Vancouver, which own all the stock and the whole of the Burrard Inlet Bridge and Tunnel Company.


John Warwick King: My hon. friend
will probably assist me in regard to the name of the railway that received the first subsidy. I think it was the Westminster-Yukon.


Henry Herbert Stevens: The old charter was to
the Westminster-Yukon Railway. They never got any distance. That does not affect this vote, nor does it affect the charter referred to m the estimates.


Robert Gardiner: Did the present company have to buy the charter of the former company?


John Warwick King: No.


Robert Gardiner: Has the federal government ever contributed to the building of bridges over the northern Saskatchewan river?


John Warwick King: Not to my knowledge. They contributed to the bridge across the river at Edmonton in Alberta. We built one bridge entirely and contributed to another.


George Gibson Coote: Would the chief benefit in
this case be to owners of real estate in North Vancouver?


John Warwick King: No, the reeves
of the municipalities being on the board of directors, would be interested. If anyone is familiar with the situation in Vancouver he will realize the necessity of connecting the north and south shore of Burrard inlet.


[Stage Direction]
Item agreed to.
Progress reported
On motion of Mr. Mackenzie King the House adjourned at 12.10 a.m. (Friday).
Friday, June 19, 1925