STATEMENT OP MEMBER FOR TEMISCOUATA IN REFERENCE TO REMARKS IN DEBATE ON MAY 4

Mr. J. F. POULIOT (Temiscouata):: 
Mr. SPEAKER:: Order. I do not think
there is any question of privilege at all.



STATEMENT OP MEMBER FOR PARRY SOUND ON MAY 3 IN DEBATE ON THE BUDGET

Mr. A. G. SLAGHT (Parry Sound):: Mr. Speaker, I rise to a question of privilege. Yesterday the hon. member for St. Lawrence-St. George (Mr. Cahan) raised a question of privilege with regard to portions of a speech I had delivered in the house the day before. Unfortunately I was not in the house yesterday when the hon. gentleman began his address and therefore I did not hear a great portion of his remarks. I have since carefully read Hansard and desire after so doing to make this statement.
I find that the references in the biographies to which the hon. member referred and the extracts therefrom which he quoted to' the house place the matter of his previous observations on February 21, to which I took exception, in an entirely different light. Let me say that, when he made the earlier speech referred to, he based his criticism of a former president of the United States entirely on something he had learned when in London in 1903 and did not vouch for the name of his informant or give any particulars.


Mr. CAHAN:: Mr. Speaker, allow me to
interrupt. That statement is incorrect. I did not base my statement entirely on what I heard in London.


Arthur Graeme Slaght: 
Walter Edward Foster: The hon. gentleman has stated his position; he must not make a speech.


Arthur Graeme Slaght: In conclusion, Mr. Speaker, I desire to associate myself with the sentiment expressed by the hon. gentleman in the closing lines of his remarks of yesterday, found at page 3552 of Hansard in which he says:
In other days, years ago, perhaps I would have been tempted to reply in undignified and more severe language to the charges made. But as I grow older I am not so disposed to be vituperative as perhaps I once was, and therefore I submit the matter, sir, for your consideration.
I have just passed another milestone and believe that I should also take to myself some of the sound philosophy contained in that language, and I welcome this my first opportunity to tender the hon. gentleman my sincere regret for the error I made.


Charles Hazlitt Cahan: Just one word. I accept the retraction and apology of the hon. gentleman so far as it went, but I do not accept the restricted conditions under which the apology was pronounced.


Walter Edward Foster: I think the incident is closed and the question settled.



REPORTS OF COMMITTEES


[Stage Direction]
Third and final report of the special committee on the Civil Service Superannuation Act.-Mr. McLean (Melfort).

[Stage Direction]
Fifth and sixth reports of the standing committee on banking and commerce.-Mr. Moore.

[Stage Direction]
Second report of the standing committee on agriculture and colonization.-Mr. Weir.

[Stage Direction]
Mr. W. H. GOLDING (Huron-Perth) presented the fifth report of the standing committee on standing orders, and moved that the report be concurred in.
Motion agreed to.


Right Hon. W. L. MACKENZIE KING (Prime Minister) moved:: That private bills reported from standing or select committees be placed on the order paper for the consideration of the committee of the whole house on the day on which such report is received, and that standing order 109 be suspended in relation thereto.
He said: This is the customary motion before the close of the session.


Mr. COLDWELL:: May we have an explanation of the effect of the motion?


William Lyon Mackenzie King: My hon. friend did not catch what I said. Standing order 109 provides:
Private hills reported to the house by any committee, shall be placed upon the orders of the day following the reception of the report, for consideration in committee of the whole, in their proper order, next after hills referred to a committee of the whole house.
Citation 886 reads:
Towards the end of the session, it is not unusual to place bills reported from select committees immediately on the orders of the same day, but this can be done only on motion and by general assent.
I assume that we are towards the end of the session, and this is the usual procedure at this stage.


[Stage Direction]
Motion agreed to.
3606	COMMONS
Business of the House-Saturday Sitting

[Stage Direction]
Bill No. 125, for the relief of Audrey Elizabeth Logan Williams.-Mr. Plaxton.
Bill No. 126, for the relief of Winnifred May Routledge Nilsson.-Mr. Walsh.
Bill No. 127, for the relief of Ernest James Feasey.-Mr. McAvity.
Bill No. 128, for the relief of Ethel Jean Peters.-Mr. Bercovitch.
Bill No. 129, for the relief of Eva Clara Doe Durrell.-Mr. Hill.


William Lyon Mackenzie King: That on Saturday, the 6th instant, the house shall meet at 11 o'clock in the morning and continue to sit until 6 o'clock p.m., with an intermission from one to two o'clock p.m., and that the order of business and procedure shall be the same on Saturday as on Friday.


Mr. J. S. WOODS WORTH (Winnipeg North Centre):: I must protest against any motion of this kind being carried. We all know that there is a regular drive on now to prorogue at the end of next week. After to-day there would normally be only five full days of parliament. I submit that one more day such as now proposed will not be sufficient to accomplish the proper conduct of the business in order that we might close a week from to-day. The Minister of Justice (Mr. Lapointe) said the other day that there was no desire on the part of the government to "railroad" business; that if necessary the government were prepared to stay here as long as any of us, or longer. Those are very good words, but I regard this motion to-day as the beginning, or possibly the second move, in the railroading of business-that is the pushing of the business through without adequate consideration.
I submit in the first place that few hon. members of this house have the physical and nervous energy to stand the strain which is being imposed upon us. I think personally I have been as wiry as almost any member of the house, but at the close of a session I find I have not the energy to be here during extra hours as one would be required to be, in fact to accomplish the impossible feat of being in two or three or four places at the same time. Throughout the session I, as many other members, have been here at the buildings shortly after nine o'clock in the morning, and we are here until eleven o'clock at night, with the exception of luncheon and dinner hours; and even these hours are not infrequently used for consultation and small con-

ferences. I submit that from nine in the morning until eleven at night is altogether too long a daily period for any normal being to be asked to work. Yet now it is proposed to extend those hours. I wonder that the Prime Minister does not put us on Sunday work as well; it would be quite in keeping with the general program.
Committees are not by any means through with their work, and are still meeting almost every day. One committee that I am on met this morning and is proposing to meet again this afternoon, while the house is in session, while important business is being dealt with here.


Mr. LAPOINTE (Quebec East):: Is it new, this process?


Charles Stephen Booth: No; I have objected to it on other occasions.


Ernest Lapointe: We have been doing it every year.


Charles Stephen Booth: Yesterday I was asked to attend a subcommittee of one of the committees both in the morning and again in the afternoon, while the house was sitting, and while another important committee of which I was a member, was sitting. Other important committees are being called daily, in some cases twice a day, in a desperate effort to get through. That does not permit the proper conduct of business. We have an important committee studying the Bren gun matter. We all know that that involves questions concerning the conduct of a minister of the government and prominent government officials. I would not like to suggest-* I do not really believe it-that this procedure is proposed in order to avoid discussion of that unfortunate affair; but if this motion is pushed through it will have the effect of preventing discussion of that matter as it ought to be discussed on the floor of this house. I should think that for the sake of its own self-respect the government would see that it should be discussed before the close of this session, which may be the last session of the present parliament.	[DOT]
There is much other important legislation to be dealt with. We have these very important agricultural bills. Only to-day I received a telegram from the council of the city of Winnipeg urging that I take a certain stand, namely the support of the 80 cent pegged price for wheat in connection with the bills now before us. It is not a question affecting merely a few farmers; it is a question vital to the whole west. How can I permit a matter of that kind to be rushed through, a matter so important as to have already

Business of the House-Saturday Sitting
compelled certain concessions from the government, and so important that it ought to compel other concessions? How can we pass over these very important agricultural bills?
Then what about the Canadian National capital expenditure, another very important matter, and one which the other chamber has been discussing-or at least allied subjects; the whole question of the railways and the suggested amalgamation or cooperation or whatever it may be termed? These are important matters which have not been heretofore discussed.


Ernest Lapointe: We are all opposed to that.


Charles Stephen Booth: That may be, but let us discuss the proposals and decide them in a regular manner.
Then the estimates; I have not checked carefully the estimates myself, but I think not more than twenty-five per cent of them have been considered. It is all very1 well to say, "Well, the estimates are there and we have to take them or leave them; we cannot help ourselves." But that is contrary to the whole principle of parliamentary procedure and the rights of parliament. After all, in practice the estimates provide the only opportunity we have for review of the activities of the various departments of government. Most of these departments have not been under review at all, and now it is proposed in the dying hours of the session to rush through the major part of the estimates without consideration.


Ernest Lapointe: It does not seem to be dying.


Charles Stephen Booth: Well, I hope it is not. That is one reason for my speaking, in order to prevent its dying without completing its work.
Take another question, the matter of national defence. We have been told by our military people and others that national defence is the most important matter before the country to-day. We have been told that war is imminent, that if such is the case Canada ought to devote a great deal of her energy to considering what her part will be in the defence of the countiy. We have not yet had any opportunity to discuss defence. We discussed foreign policy; some of us almost had to urge its discussion, but now that we are within a week of prorogation- what is suggested should be prorogation- although concerning the matter of national defence there is a very great deal of difference of opinion in this country. In spite of this,
we are told we are to have no opportunity of adequately discussing this all-important question. I should think that if I were strongly in favour of largely increased grants for national defence on account of the danger by which our country is threatened I should want to stay here, if necessary, all summer in order that we may be prepared for this coming war. Not taking that view, I feel that some of us will have to stay here as long as necessary to prevent the government from proposing heavy expenditures for these purposes without at least telling us what the expenditures are for, and without showing how they really implement any policy the government may have brought down.
I said to the Prime Minister following his statement on the matter of foreign policy that really after his speech I did not know precisely what the foreign policy of the government is, although I listened to him attentively. Now the best we can do is to try by means of study of the national defence estimates to determine what the government proposes to do with regard to foreign policy. Are we preparing to send an expeditionary force? If we are, as the estimates might easily indicate, then we members ought to know it, and the country ought to know it. Conscription is to be introduced in England, and it is quite possible that it may be introduced in this country-under our constitution. If that is to be done, the country ought to know it; if that is not the policy of the government, the government ought to say so in unequivocal language.
We are told that all these great and important matters must be set aside simply because the king is going to visit the country. I have nothing to say against the visit of their majesties; I do not want in any sense to disparage any honour that might be paid to them. But I believe that we would honour them in the highest degree by carrying on the business of the country; that is my firm conviction-not by scamping that business, as I consider would be the case if this motion goes through and other similar measures follow as they are almost inevitably bound to do.
I think the Prime Minister, if I may say so, is becoming almost obsessed with his responsibilities and the responsibilities of this house, in making the most extraordinary arrangements with regard to the coming of the king.


Some hon. MEMBERS:: Order.


Charles Stephen Booth: I said, and I repeat, that it seems to me our primary responsibility as a parliament is to do the business of this country-
3608	COMMONS
Business oj the House-Saturday Sitting


Ernest Lapointe: Then let us do it.


Charles Stephen Booth: All right; let my right hon. friend possess himself in patience as far as he can under the circumstances.


Ernest Lapointe: I hope my hon. friend will do that, too.


Charles Stephen Booth: I said to the Prime Minister a week or two ago that we in this corner had no desire in any way to block or unnecessarily prevent the business of this country going through. On the other hand I said, and I think he accepted my statement, that the business of the country was paramount and should be concluded. If we can conclude it in a regular and dignified way, giving it adequate attention, I say by all means let us do so. If we cannot, then I do not see why this mode of procedure should be resorted to. The Prime Minister states that he feels it to be his duty to accompany the king during the entire time he is Canada and the United States.


Some hon. MEMBERS:: Hear, hear.


Charles Stephen Booth: Hon. members on the government side say " hear, hear," and heartily endorse the position of the Prime Minister. That is their privilege. If he so feels-and he will have to take the responsibility for that line of action-I see no reason at all why the Prime Minister could not accompany the royal train and leave the rest of us here after his majesty has left Ottawa. There is no reason whatever why we should take a recess of weeks and weeks. And then the Prime Minister threatens us-or perhaps I should not use that word-he says he is firmly of the opinion, and the government have adopted the policy, that if we do not get through we will have to come back in midsummer. I still say that I see no reason why the Prime Minister could not carry out what he no doubt honestly believes to be his duty and accompany the royal train, leaving parliament here to carry on its business. Why, in any case, the Prime Minister has been hardly in his seat during the last week.


Some hon. MEMBERS:: Oh, oh.


Charles Stephen Booth: That is a fact. I have no quarrel with that, but my point is that if the house can get along without the Prime Minister for that length of time it could get along without the Prime Minister during the two or three weeks that might be necessary to complete the business of the house, especially when the government would be led by my very capable and genial friend

the Minister of Justice. I have nothing further to say-


Some hon. MEMBERS:: Hear, hear.


Charles Stephen Booth: -except this-


Some hon. MEMBERS:: Sit down, then.


Charles Stephen Booth: We are not getting anywhere with this sort of thing. I think a certain measure of courtesy is due hon. members when they adhere to the rules of the house-I am quite within the rules-and when they honestly differ in policy from the party that happens for the moment to be in power. We are going to get along much more rapidly in this house-and I am not throwing out any threats-if the business is conducted in an orderly fashion and if the ordinary courtesies are extended to groups, which may be small in number but whose members as members of the house have certain rights.
I urge that this matter, with all that it involves, be reconsidered.


Hon. R. J. MANION (Leader of the Opposition) :: Mr. Speaker, I have not very much to say in regard to this question. Some weeks ago we did discuss the matter, and at that time I took the attitude that it would be the duty, the willing duty, of this party to cooperate so far as possible in concluding the business of the house before the arrival of their majesties. At the same time I cannot help but think that, with only five or six days remaining before the time it is proposed to prorogue, it is very doubtful if we can complete the business that is before us. I was looking over the order paper this morning. In addition to committee reports and important legislation, which unfortunately was brought down a little late-these wheat bills, for example, with which we began to deal only yesterday-we have the resolution standing in the name of the Minister of Finance (Mr. Dunning) regarding a central mortgage bank, which has not been touched at all, together with another resolution in the name of the Minister of Fisheries (Mr. Michaud) dealing with a salt fish board. In addition, as the hon. member who has just taken his seat has stated, there is a huge amount of estimates still to be passed, which somebody estimated for me this morning at something over $400,000,000. So I doubt very much if it is possible for this house to conclude its business by the time their majesties arrive.
However, Mr. Speaker, I want to say that while I quite agree with the hon. member who has just taken his seat, to the extent that it is a strain on all of us to be sitting in this house for such long hours, in addition

Business of the House-Saturday Sitting
to attending to our duties in our offices, at the same time I have no personal objection, nor has the party with which I am associated any objection, to sitting to-morrow if it will facilitate matters. I do not think it will facilitate matters sufficiently, however, to give us a chance of concluding our business before their majesties arrive; even if we take a couple of extra days I doubt if that is possible without giving the appearance of showing rather unseemly haste or undignified hurry in disposing of the business.
In that regard I should like to mention another matter. When we were discussing this question some time ago I offered the opinion that so far as I was concerned I was not going to make any trans-Canada speeches -if any of them ever get across Canada- in regard to politics while the king and queen were here. Let me quote my words:
That being so it seems to me it would be very difficult for the house to continue to sit while their majesties are here and while the Prime Minister is travelling across the country with them.
I added the reason:
After all, it would be practically impossible, during a continued sitting of the house, to avoid matters of dispute or criticism here. So it would appear almost inevitable that during the visit the house must be adjourned, if it is not prorogued, until the king and queen leave the country.
I must confess very frankly that in my own party there is a considerable difference of opinion on that question. Many members wish or hope that we might be able to prorogue at once. I think most of us wish that, if it could be done without seeming to ignore the real business of the country. Personally I have come to the conclusion that it is practically impossible to do so. Others of my party would like, instead of adjourning a month, to adjourn for a week only. I have expressed my opinion, but on thinking it over I should be quite willing to leave the matter in the hands of the house; and if the whips could get together, with the Prime Minister's consent it might be possible to come to some other arrangement. I do not wish to have those words of mine interfere in any way with what is most convenient for the majority of the members of the house. Consequently so far as I am concerned I should be very glad if the Prime Minister cared to reconsider the matter. If he does not; if he feels that he must do it otherwise, I will not offer the least criticism. On that previous occasion he was pretty definite, as I was also, but in view of the pressure on the part of many of my own members and having heard a good deal of discussion among other hon. members, I
felt that perhaps the matter should be reconsidered, and I should be quite willing to agree with what the majority of the house is anxious to do.
With regard to sitting to-morrow I repeat that if, in spite of the protest of the hon. member for Winnipeg North Centre (Mr. Woodsworth), the Prime Minister wishes to adhere to his motion, we are quite willing to do so. If after listening to the emphatic protest that has just been made the Prime Minister cares to let the matter stand, that will suit me just as well. I have expressed a few opinions, but let me repeat that I do not think it is possible for us to attempt to conclude, within the next six or seven days, the amount of business that still remains to be dealt with. I believe it is our duty to decide later, with the consent of the government, what is the best course to pursue.
(The member for Vancouver East having risen):


Some hon. MEMBERS:: Sit down.


Mr. ANGUS MacINNIS (Vancouver East):: Mr. Speaker, I was going to permit the hon. member for Lethbridge (Mr. Blackmore) to precede me, but when one gets orders from the other side of the house to sit down it is better to stand up.
I believe the leader of the opposition (Mr. Manion) has put the matter very clearly. If there is no possibility of finishing the business before next Friday, there can be no justification for rushing the business at the present time. If we cannot finish by next Friday we shall have to meet after his majesty leaves Ottawa for the western trip, or after he leaves Canada.
There is an enormous amount of business to be done. Only this morning I looked carefully through the estimates, and I find that of a total amount approximating $550,000,000 we have passed only something like $30,000,000. That is a very small percentage of the total amount. I believe one of the main functions of an opposition is the careful consideration of estimates before parliament. If the opposition-and I am referring particularly to the official opposition-allow these estimates to be voted in large sums, without due consideration, there will be no check whatsoever upon expenditures. I feel quite satisfied that it would be taken throughout the country that the opposition had not fulfilled its duty if proper consideration of those expenditures were not made.
3610	COMMONS
Business of the House-Saturday Sitting
I see no reason why we could not sit here while his majesty is in other parts of Canada. This fear of doing something while his majesty is here savours of provincialism in the extreme. There is no curtailment of debate in the imperial parliament when his majesty is in England, or when he is in London, where he usually resides. His majesty, we are told, is king of Canada as well as king of Great Britain. Why, then, should we curtail our discussions in the house because our king happens to be in Canada? I agree the proper thing to do is to proceed with our business in the ordinary way. When his majesty leaves for the west we can resume business here, regardless of whether or not the Prime Minister is in attendance in the chamber. He has very capable lieutenants who, I believe, could lead the house in his absence.


Mr. J. H. BLACKMORE (Lethbridge):: Mr. Speaker, my particular group have no objection to sitting on Saturday, or to spending extra time on the business of the country any other day. Above all things we do desire that there should be adequate discussion, and that so far as is humanly possible we should arrive at constructive and effective decisions, particularly regarding agriculture, unemployment and finance.
We are ready to cooperate with the government and other members of parliament as far as seems wise and becoming. Therefore we are inclined to allow the government to lead while we walk along by their side, so to speak, in the matter of conducting the sittings. We are disposed to think that a short adjournment of seven or eight days would be advisable, provided it were not possible to finish our business before their majesties arrive. With respect to the possibility of finishing, may I say that we are too inexperienced in parliamentary matters to be in a position to forecast whether or not it could be done. It looks to me impracticable, having in mind the manner in which I have seen some things done. However I am not adverse to trying.


William Lyon Mackenzie King: Mr. Speaker, perhaps I
should first remind hon. members that the motion before us at the moment is in relation to the house sitting to-morrow. It is not whether or not we, at the time of their majesties' visit, will adjourn for a few days, or adjourn until after their majesties' visit, but whether we will sit to-morrow morning and afternoon.
In the first place may I say, in regard to the motion, that were it not that Sunday is the day following, I should not have thought

of presenting it. I can assure the hon. member for Winnipeg North Centre (Mr. Woodsworth) that I am as desirous as he is to see that Sunday is duly observed, although I regret it is not always possible to observe it the way one would like to. But certainly as a day of rest I hope on this occasion we shall all be able to observe it as such.
I agree with what the hon. member has said about the stress and strain of public life. I think I perhaps have more reason to know about what is involved in that particular than any other member of the house. And while we are speaking of that, may I say to my hon. friend that the fact I have not been continuously in my seat for the past week is not evidence that my time has not been exclusively taken up with public business.


Major James William Coldwell: No one has suggested that.


William Lyon Mackenzie King: But the comment goes out to the country as such. May I say that last fall I was obliged to take a short rest on account of the condition of my health at the time. That rest was concluded at the end of October, I think it was, and from that time until this-not excepting Sundays-there is no day in which I have not given most of my time, in fact practically all of my time, to the work of the government of this country.


Charles Stephen Booth: If the Prime Minister would permit me to say so, there was no such thought in my mind. My point was simply this, that if we had worked here during the Prime Minister's absence for the last week, we might manage to do so for the next week or so. But I have no doubt the Prime Minister has been exceedingly busy.


William Lyon Mackenzie King: The fact the hon. member and other hon. members feel the house will not suffer from my absence is one of the reasons which perhaps caused me to be a little less in the house during the last week or two than otherwise I would have been.
I perhaps might remind the hon. member that most of the measures, certainly all of the government measures, which are before the house have been fully discussed in cabinet. With very few exceptions I have been present at all meetings of the cabinet, and have participated in discussions of these matters. I know what the position of the government is to be, and I have felt it perfectly safe to leave in the hands of the minister in charge of a government bill the statement to the house, and to leave to my colleagues the debate on measures of that kind. I do not

Business of the House-Saturday Sitting
think it is customary in any parliament for the Prime Minister necessarily to remain in the House of Commons when bills are being discussed which are in the hands of his colleagues, and particularly in the hands of colleagues as exceptionally competent as those I have the privilege to have around me.
May I say to the hon. member that the motion to sit to-morrow is not for the purpose of driving the house. It is not for the purpose of railroading business through the house, but rather for the very purpose of avoiding both those things. I believe there is a general desire on the part of all hon. members to bring the business of this session to a close, and to see whether it can be done before their majesties arrive or whether there will have to be an adjournment for a shorter or longer time. By giving one extra day for discussion of business I believe we shall be in a better position in the course of the next few days to know whether or not it will be possible to finish the business before their majesties arrive in the city. I may point out that such is the whole purpose of the motion. It is to enable us to see if by giving a little more time to discussion and consideration of public measures and by avoiding the necessity of rushing matters we may, by sitting to-morrow, and perhaps a little longer on some other days, accomplish that end.
Let me make perfectly clear what I said at the beginning of the session. The government. does not intend to crowd this House of Commons with respect to public business. If it is the disposition of hon. members, by arrangement among themselves as to which members are to speak on different measures and the like, so to facilitate business that it may be possible to get through earlier than we otherwise would, of course that will be all to the good in shortening the period during which this house will have to remain in session, either before or after their majesties' visit.
But if ws cannot get through before their majesties arrive here, I am perfectly sure that we shall be doing greater justice to the public business of this country if we take an adjournment until after their majesties have left Canada, and then have the house resume to discuss matters without any sense of either pressure or confusion. From what hon. members have said to me, I am certain it is the wish of many of them to be in their constituencies when their majesties are passing through. I think it will be expected that the ministers of the crown will be with their majesties in different provinces as the king and queen pass through their respective provinces. I am sure that the public interest will
be centred on the visit of the king and queen and the many matters incidental thereto during the period of time their majesties are here. Generally the public will get a much better appreciation of the care with which this house is discussing public matters if that discussion takes place after their majesties have left rather than at a time when the public mind is occupied, as it will be, with their majesties' visit.
For that reason the government has thought it advisable to adjourn, if necessary, over the entire period of their majesties' visit rather than to attempt a short adjournment and continue later. May I say that in asking the house to adjourn for that period of time we are giving evidence of our desire to avoid any rushing of public business or any confusion. May I remind hon. members that when my predecessor was in office and the silver jubilee of King George V took place in England, the house gave its consent at that time to adjourning over the period of the silver jubilee in order that the Prime Minister might be present in London throughout that time. There was an adjournment of a month and the house came back at the end of that time and resumed its business. If it was desirable at that time to adjourn the house for a month for that particular purpose, there is a much stronger reason for an adjournment at this time. I do not know that there is anything further that I need say at the moment, except that I believe hon. members know that my wish has been to try to meet as much as possible the desire of the house. Probably the best way to decide whether the present motion meets with the wishes of hon. members is to leave it to a division.


[Stage Direction]
Motion agreed to.


[Stage Direction]
On the orders of the day.
Mr. JEAN-FRANCOIS POULIOT (Temis-couata) (Translation): Mr. Speaker, in connection with the recent readjustment of electoral divisions in the province of Quebec, I should like to ask the Minister of Justice (Mr. Lapointe) what action the government intends taking in regard to the redistribution of dominion electoral districts, inasmuch as, according to the Elections Act and the Representation Act, the description of dominion constituencies follows that of the provincial electoral divisions. Would the Minister of Justice kindly tell the house what action he intends taking in regard to federal constituencies whose boundaries may have been modified by the
Grain Futures
[Stage Direction]
provincial readjustment particularly in regard to Temiscouata, whose member wishes to get back the parishes taken, from him by the former government?
Ernest Lapointe: I shall be glad to inquire into the matter raised by my hon. friend. However, I think the Representation Act contains a clause stating that the words or expressions used to denote territorial divisions are to be construed as indicating such territorial divisions as existed at the date of the passing of the act. Therefore, any changes effected since would have no effect as regards the dominion act. In any event, I shall ask my hon. friend to let me examine the matter and take it under consideration.



RAINY LAKE WATER LEVELS


[Stage Direction]
Right Hon. W. L. MACKENZIE KING (Prime Minister) moved the second reading of and concurrence in amendments made by the senate to Bill No. 72, to carry into effect the provisions of the convention of the 15th September, 1938, providing for emergency regulation of the level of Rainy lake and of the level of other boundary waters in the Rainy lake watershed.
He said: The first amendment is to section 4. When the bill passed this house this section read in part:
-in the event the commission shall determine that such emergency conditions exist.
The senate have added the word " that " before the word " commission." With this amendment this phrase would read:
[Stage Direction]
in the event that the commission shall determine that such emergency conditions exist.
By way of explanation of the original text I may say that it followed the language of the agreement itself upon which this particular section is based. The other amendment has to do with section 7, which now reads in part: -make all orders and issue all processes necessary.
The senate have changed this to read:
-make all orders and issue every process necessary.
The only comment I would have to make on this change is that if it were found necessary to change the phrase " all processes " to " every process," I cannot see why it should not be equally desirable to change the phrase " all orders." However, the meaning of the section will remain as it was, and I suggest that these changes be accepted.
f.Mr. Pouliot.]
Motion agreed to; amendments read the second time and concurred in.


[Stage Direction]
Hon. W. D. EULER (Minister of Trade
and Commerce) moved the second reading of and concurrence in amendments made by the senate to Bill No. 81, to provide for the supervision and regulation of trading in grain futures.
Mr. MacNEIL:: Explain, please.


Mr. EULER:: These amendments are not very far-reaching. The first amendment is to section 5, paragraph (d). This paragraph now reads in part:
(d) requiring every member of the Winnipeg Grain Exchange to obtain from its agents and correspondents such particulars of all transactions in grain futures-
The amendment would make this paragraph read:
(d) requiring every member of the Winnipeg Grain Exchange to use his best endeavours to obtain from his agents and correspondents-*
The senate thought that the section as it was possibly placed responsibility upon a man which conceivably it might be impossible to fulfil. The government has no objection to modifying the section in that way.
The next amendment is to subsection 2 of the same section 5, which reads:
Before any such regulation is made notice thereof shall first be given to the Winnipeg Grain Exchange and the Winnipeg Grain and Produce Exchange Clearing Association Limited, and each of the said associations shall be given an opportunity to be heard in connection therewith.
The insertion after "each of the said associations" of the wmrds "or any member thereof" is quite unobjectionable.
Section 8, subsection 1(d), says that the board may:
-suspend from trading privileges any member of the Winnipeg Grain Exchange if in the opinion of the board such member has been guilty of a breach of this act or of any regulation or order made thereunder and require the officials of the Winnipeg Grain Exchange to exclude any such member from trading privileges, and forbid any other member to accept orders from such member for the purchase or sale of grain.
The proposed amendment is to add:
. . . except for the purpose of closing out then existing trades.
There is no objection to that. Finally, it is proposed to substitute for subsection 2

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of section 8 something which is entirely reworded. It now reads:
The board may, where in its opinion a by-law or rule of the Winnipeg Grain Exchange relating to trading in grain futures operates injuriously to the public interest, after hearing representations, if any, on behalf of the association by order revoke or vary such by-law or rule.
Certain members of the senate had representations made to them, and the fear seems to be that under that clause it might be possible for the board to cancel all the rules of the exchange and thus close the exchange altogether. My own thought is that there is no practical likelihood of that happening, because the whole bill is predicated upon the continued operation of the exchange, and it is intended only to supervise it. However, as it does not conflict with the purpose of the bill, it is proposed to insert this instead of the clause which is there now:
The board may, where in its opinion a by-law or rule of the Winnipeg Grain Exchange has brought about or is threatening to bring about a condition which is prejudicial to the public interest arising from trading in grain futures, after hearing representations, if any, on behalf of the exchange by order revoke or vary any such by-law or rule: Provided, however, that this subsection shall not authorize the closing of the grain futures market or any limitation of future trading other than as set out in subsection one of this section.
As the amendment does not conflict with the purposes of the section, the government has no objection to it.


Mr. E. E. PERLEY (Qu'Appelle):: I suggest that these two amendments definitely limit the powers of the board; the supervisor would be a mere visitor to the clearing house or the exchange. A man who has had considerable experience in grain dealing and is much interested in it has made the suggestion that, even under the measure as originally drafted, the supervisor would be just a visitor. These two amendments make the act practically inoperative as a useful measure.
Motion agreed to; amendments read the second time and concurred in.



CRIMINAL CODE


[Stage Direction]
Right Hon. ERNEST LAPOINTE (Minister of Justice) moved the second reading of and concurrence in the amendment made by the senate to Bill No. 90, to amend the criminal code.
He said: In order to bring back the hon. member for Winnipeg North Centre (Mr. Woodsworth) to his usual happy mood, I am pleased to tell him that no amendment was made to section 11, which both he and I have at heart. The only amendment which has been made is to section 7, concerning publication of false advertisements to promote sales. The words of the section as printed were:
. . . any advertisement for either directly or indirectly promoting the sale-
The senate put the words "either directly or indirectly" after instead of before "promoting." I am not enough of an authority on grammar to know whether this is better than the first version, but I have no objection to it.
Motion agreed to; amendment read the second time and concurred in.


[Stage Direction]
The house resumed from Thursday, May 4, consideration in committee of Bill No. 89, to assist and encourage cooperative marketing of agricultural products-Mr. Gardiner-Mr. Sanderson in the chair.
On section 2-Definition.
Mr. BARBER:: I should like a little information with regard to this section. Take a case, we will say, in the lower mainland of British Columbia where a group of producers might wish to form a cooperative and to come under this bill. Would the regulations specify, or is the minister in a position to-day to say, what proportion of the growers or producers in that particular district or defined area would be required? Second, if they were successful in forming a cooperative, would provision be made for the setting up of what they call the scheme under which they are to operate? Third, would there be provision or powers given to levy assessments-which of course, as the minister knows, has been a source of trouble in the past-under the marketing act?


Hon. J. G. GARDINER (Minister of Agriculture) :: As far as the first two questions are concerned, a provision will be made under this bill. The percentages of producers which would be required to enter into an undertaking of that kind would depend entirely upon the question of the financial soundness of the organization which might be set up. If the government were going to guarantee up to 80 per cent of the payments, of course they would not enter into an agreement where the percentage of people in any particular

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area desiring to enter the scheme was very small: probably they would suggest that more organization work be done before the government would assume that responsibility.
As to the matter of forcing or authorizing a minority to become a part of the membership, there is nothing in this bill which provides for that. I understand that under legislation of British Columbia there is authority of that kind which could be exercised.
As to the matter of regulating the amount of the product which might be exported or sold into another province at any particular time, there is nothing in this bill which empowers the government to regulate that. Requests have been made for that kind of thing, but nothing has been placed in this bill which gives power to the government to enforce such a regulation. There was a third question, was there not?


Harry James Barber: What percentage of producers, for instance growers in that particular area, would be required before they would be recognized as a cooperative under this act?


James Garfield Gardiner: What was the last
question?


Harry James Barber: The last question was in
regard to making an assessment as to the carrying charges. It will be remembered that we had trouble in this respect before.


James Garfield Gardiner: There is no power for
making assessments. I understand that in six of the provinces there is legislative provision for assessments to be made by organizations which are operating provincially. As to the matter of percentages, I dealt with that in the answer I made at the beginning. There is no definite percentage set in the bill, but naturally the government would want to have a considerable percentage.


Harry James Barber: I believe that under the
old legislation it was about 80 per cent.


James Garfield Gardiner: About that.


Harry James Barber: There is one other question. As the department and probably the minister are already aware, the Fraser Valley Milk Producers Association and dairy producers generally in the lower mainland of British Columbia have been having difficulties. They are now being brought under the control legislation of the provincial government, and for twenty years or more voluntary cooperation was successful, but they have experienced the difficulties which all cooperatives encounter when they are faced with a large and accumulating surplus and the problem of disposing of it. There is also difficulty when

they expand and create a considerable overhead. I believe we have experienced both of these phases in the Fraser valley. Under this legislation will there be any opportunity for relieving and straightening out that situation? I notice that the control scheme was to come into force, selling through the central agency, on the first of this month, but an injunction has been filed and the whole matter is tied up. This has been going on for the last year or two and the farmers are suffering. The dairy industry has reached its lowest ebb in thirty years so far as the lower mainland of British Columbia is concerned. They are almost desperate. Does the minister think that there will come out of this legislation anything that will be beneficial to these producers?


James Garfield Gardiner: The legislation would
assist them only to this extent, that if they could present to the government a proper statement which would justify us in concluding that we were not financing obligations that they had undertaken previously, which they could not otherwise finance, the government would then, on the basis of the submission which they might make respecting their financial position, consider whether it would be of any assistance to them to guarantee up to eighty per cent of the amounts they were giving as initial payments during a particular season. If that were of assistance to them they could obtain that help under this bill.
As regards surpluses, I understand they are subject to the control of provincial legislation. The provincial legislation is much the same in principle as the old Natural Products Marketing Act passed in 1934. Under that legislation an attempt was made to control both production and acreage and to establish some control over price, as well as to make levies. So far as the set-up in the Fraser river valley is concerned, in connection with the distribution of milk, I found that under the old Natural Products Marketing Act during the time it was still on the statute book, and for the first two months that I was in charge of the department here, more of my time was given to the milk producers in the Fraser river valley than to all the rest of the agriculturists in Canada. I had telegrams and letters of from one to two pages of foolscap coming in periodically. I had three delegations in the first few weeks I was in charge of the department-delegations all the way from Vancouver to Ottawa to discuss ways and means of improving the distribution of milk in the city of Vancouver. It will be readily agreed that that kind of local problem can be much more easily and properly dealt with by the local authority

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situated on the spot than by the authority at Ottawa. We are not attempting under this legislation to deal with these local matters.


Harry James Barber: The federal government, through the Department of Agriculture or the Department of Trade and Commerce, might however be of great help, because when we talk about a surplus, that includes a large number of by-products which are for export only, a very small quantity being used in the province. I refer to such commodities as condensed milk, milk powder, casein and a good many other by-products which are there to-day and cannot be disposed of. That is a problem which in my opinion is up to the federal government. It is for the departments here to assist these people in marketing their products.


James Garfield Gardiner: The Department of Trade and Commerce do assist in the marketing.


Miss MACPHAIL:: If under this act no control is given over interprovincial trade and none over export trade, and if it does not give power to boards of farmers and does not do anything to cope with the greatest problem in cooperative marketing, namely, the minority who so often ruin the hard and self-sacrificing work of the majority, just what good is the bill and what does it propose to do? I have read it over about five times and I am still at a loss to know what we shall do, when we have in the provinces marketing legislation that does not take care of interprovincial or export trade and does not control the minority or give powers to the boards.


James Garfield Gardiner: When the proposed legislation was first placed before the house, British Columbia also had legislation which empowered the government there to take such steps as were deemed necessary in the light of the federal proposal. Ontario had similar legislation but none of the other provinces had that type. Alberta was giving consideration to the question and since then they have passed legislation, as a matter of fact in the last two or three weeks. Manitoba has since passed legislation similar to that of British Columbia, and the province of Quebec last week, within the last few days of the session, passed legislation which, though it does not go quite so far as the legislation in some of the other provinces, places the province in a position eventually to deal with the matter. New Brunswick has done something of the same sort. Action was finally taken in four provinces since this legislation was first introduced in the house by way of resolution, and since it has advanced a stage further, representations have been made to us, first by a committee appointed by the conference that
met in Montreal a short time ago and, a few days later, by representatives from both the western and the eastern provinces, asking that we place on the statute book this session such legislation as would enable us to empower the boards to control the export of farm products, to make levies upon producers and in certain areas to enforce upon the minority the wishes of the majority. I suggested to them that we have had no cooperative legislation of any kind since the Natural Products Marketing Act was declared ultra vires, and having had no such legislation I thought it wise at this session to lay down the fundamental basis for the setting up of cooperative organizations that might have the endorsement of parliament.
With all due respect to those who think that the most important thing at the present time is to compel people to enter cooperative organizations, I would point out that before that step was taken in Denmark, to which country we look for many of our illustrations of what cooperatives can do, eighty-five per cent of the people had voluntarily joined these cooperatives. After eighty-five per cent had voluntarily joined them and they had been carrying on for some time successfully the government passed legislation making it possible to force the others who were interfering with the operations of the organization to become part of it. I think that has been pretty much the practice everywhere. Certain provinces in Canada have for a long time been promoting cooperative organizations; Quebec is one, British Columbia another, Alberta another, and Saskatchewan another. Other provinces have in recent years been enlarging upon their activities in that direction. We think it wise to allow this legislation, which has been placed upon the statute books of some provinces only within the last month or two, to operate for at least a year before we give further consideration to the question whether we should embody in our legislation provisions for enforcement of obligation upon a minority.


Mr. REID:: Has this bill to do entirely with the production of articles for export, or would it cover operations for the marketing of products locally?


James Garfield Gardiner: It deals with the marketing of all products, in Canada or outside.


Mr. SENN:: What is meant by section 2(c), which provides-
(i) for equal returns to primary producers for agricultural products of the like grade and quality.

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The next clause provides:
(ii) for the return to primary producers of the proceeds of the sale of all agricultural products . . . produced during the year.
Then over the page "year" is defined as meaning-
-such period of twelve months as the minister may designate as being the year of production of an agricultural product.
An initial payment is made, and any further returns I understand are, by permission of the minister or the governor in council, allowed to be paid at a later date. Is it contemplated that the final return shall be made only once a year? Of course it says the cooperative plan means an agreement or arrangement on the part of the farmers themselves. But if these returns are to be made only once a year it may easily work a hardship on some particular line of agricultural products. For instance, eggs; the production of eggs in the winter costs much more than in the summer. Farmers who are producing eggs in the winter should get a larger price than farmers in that cooperative who produce only in the summer. If there is to be a final equal return based on the amount left over after the initial payments, it would seriously affect the chances of cooperative organizations going into business.


James Garfield Gardiner: The last two statements made by the hon. member indicate the necessity for dealing with many of these matters by regulation. Section 4 provides:
4. The minister may, with the approval of the governor in council, make regulations prescribing,
(a) the time and times when any payment subsequent to the initial payment may be made:
What has been said in regard to eggs applies also to butter and cheese, which are made largely in the summer months; all these products would be handled to suit the conditions applying to their production. For that reason it is not possible to put into an act all the regulations that would be necessary in dealing with any particular product. Subsection (c) (i) "equal returns to primary producers for agricultural products of the like grade and quality" means when the original payment of not more than eighty per cent is made it is the intention that interim and final payments shall be made later. But the act requires that when these interim and final payments are made, when totalled up they shall be equal for like grade and quality.


Mr. QUELCH:: Does the minister say that the provisions of this bill can be applied to the set-up in Alberta under the new marketing act?
TMr. Senn.]


James Garfield Gardiner: They can be applied to any scheme or organization of producers that is set up in Alberta of this nature-cooperatives desiring to pool the prices of their commodity over a particular period, no matter whether at the same time they are operating under the provincial act or not.


Mr. BERTRAND (Prescott):: The minister is to be congratulated upon bringing down this legislation. We had no legislation under which farmers in Canada producing principally for export could organize. Now we have also Bill No. 84, to amend the Dairy Industry Act, under which an advisory committee will be appointed to study the whole dairy industry. That industry, in spite of what was said yesterday, has been since 1931, more important in Canada than the wheat growing industry. Not that I want to discriminate between east and west, because we agriculturists of the east think that the whole problem of agriculture in Canada should be considered as an entity. But there is no doubt that the agriculture of western Canada has been better organized in the last year than the dairy industry of the whole of Canada.
A few moments ago there came into my hands some reasons why it would be rather hard to continue to peg the price of any commodity. This little article struck me as showing that it is unwise and unfair to peg the price of wheat and not the price of farm products raised in other provinces. This truth is coming to be realized more and more by our agriculturists of the east, and they are anxious to know when this thing is going to end. A few years ago there was no doubt that wheat was in a difficult position, and legislation was passed to aid it. There was a wheat pool and a wheat board; there were bonuses and guaranteed price and fixed price and other help for the wheat growers. This was all done since 1931. But the dairy industry is more important than wheat. I repeat that because several times yesterday we were told that the wheat growing industry was the great producer of wealth in Canada. The dairy industry is in just as dire a situation as wheat. At the moment a certain part of it is controlled, but the milk sold in the Montreal district in the form of fluid milk was being paid for at $2.15 a hundred pounds. Now the summer price is being paid, $1.75 per 100 pounds. Compare that with the farmer who produces milk to be made into butter or cheese and who gets about 75 cents per 100 pounds. The cost of production, as I stated the other day, is from S1.24 to $1.28; consequently milk producers are getting much less than the cost of production.

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For this reason we are absolutely in favour of this legislation to enable the farmers to group themselves in cooperatives. We appreciate also the creation of the advisory committee that has been authorized under the Dairy Industry Act, which probably will assist the industry to take cognizance of its own difficulties. Nevertheless we claim that these measures do not go far enough. Under this section the initial price to be paid, supposing there should be a cooperative formed in a certain district, may not exceed eighty per cent of the average wholesale price of such product during the preceding three years. We are well satisfied to have this payment guaranteed and the cooperative assisted by the government in financing its operations; nevertheless this will not yield a return which will give the butter or cheese producer a revenue equal to the cost of production.
Consequently there is no doubt that the industry would urge upon, the government a fixed price, which I suppose would have to be paid on butter fat. This fixed price should not be less than 28 cents per pound of butter fat, which would mean 30 or 31 cent butter and 15 cent cheese. That is more nearly in line with what the cost of production has been shown to be. If, considering the problems of agriculture as a whole, it is wise to- fix the price of one commodity, whether in the east or in the west, we believe it is wise also that prices should be fixed for other agricultural commodities which are equally important. I do not intend to move an amendment to any part of this legislation, in the first place because under the rules and regulations of the house a private member is not permitted to do so. Still we want to draw the attention of the minister and of parliament to the fact that this matter is becoming more and more urgent. As one hon. member from British Columbia said a moment ago, the dairy industry is as badly off as the wheat industry. I believe that at the present time those engaged in dairying are anxious to learn where the money is coming from to pay the cost of fixing the price of a certain commodity. It has to come from the population at large, and though the dairymen are selling at less than the cost of production, still a levy will be placed upon them, directly or indirectly, to subsidize the production of another agricultural commodity.
We might go a step further and say it is not wise to fix the price of wheat because of the growing surplus of that commodity and the doubt as to whether we shall be able to' dispose of that wheat in the markets of the world. Yesterday I heard some hon. members state that the cooperative legislation in regard
to wheat was unnecessary and would not serve the purpose intended. I claim that at this moment it is more necessary than ever before, but it is just as necessary that similar treatment be afforded other branches of agriculture in order that farmers may receive treatment which will place them all on about the same footing. Many believe that farmers are entitled to a fixed price about equal to the cost of production, in order to place agriculture in the same position as industry, where the cost of production is all-important. Construction organizations fix wages for the labourer, the carpenter, the bricklayer and so on. To-day the farmer is the only man who has to sell his produce in the open market without being protected in any way, while at the same time he must buy his machinery and supplies in a highly protected market.
This, I suppose, has always been the situation in regard to agriculture, but I do not see why the wheat growers could not get together with the dairy farmers to see if something could not be done which would be satisfactory to all concerned. I should like to give a warning to those interested in agriculture, that if the wheat growers go too far and ask too much, while other branches of agriculture claim they are not treated fairly, this may happen:	It must be remembered that after all in Canada there are far more counties interested in the dairy industry than there are counties interested in the production of wheat, and it would be very easy simply to out-vote the influence that has been brought to bear on this house during the last few years. This has not been done because we want to hold Canada together and help those really in need. We have not criticized any assistance that has been given the west; the people of the east have always been in favour of helping the wheat growers, but in our opinion this fixing of prices favours one part of the dominion as against another, one part of the industry of agriculture as against another. We are very much afraid that unless the government takes cognizance of this fact, the dairy industry will become bankrupt, hundreds and thousands of farmers will simply go out of business, and more people will have to go on relief in the cities. At the very least those engaged in the dairy industry will see that their representatives use what means are available to assure that they receive at least the cost of production.
I make this statement at this time because this appeared to be the most suitable opportunity. When Bill No. 63 is under consideration, fixing the price of wheat, I shall have another statement to make. At the moment,

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however, I might compare the production of wheat and that of butter and cheese. I claim that the dairy industry should be safeguarded before the production of wheat, because the dairy industry can sell its production. Our domestic market consumes 365,000.000 pounds of butter, and we can sell all the cheese we can manufacture. After all, last year we exported only some 100,000,000 pounds of cheese, while we could have exported and sold, I believe, some 150,000,000 or 175.000,000 pounds. So dairying offers the agriculturist a source of revenue because there is an outlet for these products, while on the other hand we are not sure that we can sell our wheat. We cannot rely on another war to increase the price of wheat sufficiently to let the wheat growers get rich quick, and when I use those words I speak with certain knowledge. Some of my relations went out west, in conformity with the get-rich-quick policy, to make a fortune at grain growing- and some of them did it.


Mr. HAYHURST:: And they went into the dairying industry.


Elie-Oscar Bertrand: Well, those who are interested in the dairying industry have to work long hours for twelve months of the year to produce butter and milk, and they have not been able to take trips to the sunny south.


Mr. TUCKER:: The suggestion is made that we can ship almost unlimited quantities of cheese. If we attempted to force on European markets such an increased quantity of cheese, would not such action depress the price almost to ruinous depths?


Elie-Oscar Bertrand: I can answer the hon. member for Rosthern by saying that we have shipped up to 200.000.000 pounds of cheese in the past, and it has not affected the markets.


Walter Adam Tucker: Other countries have come in and taken that market. If we tried to take it away from them, would we not, in the competition, force the price down?


Elie-Oscar Bertrand: We would hope that we could achieve the same as we have in the past. At this time it is difficult to say that there is a heavy demand on the world market for wheat.


Mark Cecil Senn: And our cheese is at a premium, too.


Elie-Oscar Bertrand: Yes, our cheese is at a premium, and necessarily we will have to keep the quality at such a high standard that it will continue at a premium.


Walter Adam Tucker: Does my hon. friend suggest that the people of England would eat more cheese than they are eating to-day if we could sell twice as much of it?


Elie-Oscar Bertrand: I know the hon. member for Rosthern wants to be reasonable. When we have sold up to 200,000,000 pounds of cheese in the past, and when our cheese is selling at a premium, 6urely there is a possibility of regaining that market on a competitive basis. It would not be necessary to create a world surplus, as we have with respect to wheat.


Walter Adam Tucker: Does not the hon. member think that if we tried to take the market away from other people they would reduce their price, so as to hold it?


Elie-Oscar Bertrand: WTell, that is a technical point upon which I shall not embark. Nevertheless what I have said this afternoon must not be interpreted to mean that we are not going to support legislation which will favour the wheat growers. On the contrary, we are surely going to support that legislation. In the past we have been glad to do it, but we should not like hon. members to go back to western Canada with the idea that they are the only ones who have problems to face, and that they are the only ones who are producing under difficult circumstances and at less than the cost of production.


William Hayhurst: We fully realize that.


Elie-Oscar Bertrand: I am sure the hon. member does. I am pleased to see that at least one hon. member realizes our difficulties in the east. I say that because very often when we speak of problems of agriculture in the east we are met with talk about big bankers on certain streets in our large cities. Our people are not high protectionists-far from it. They are absolutely in favour of freer trade, and they want the prices of their necessities to be as low as possible. That condition must exist because they have to sell on the open market. Our problems in agriculture in the east are the same as are met with in the west. For these reasons I say there should not be the feeling that all the people in the east are wealthy and that therefore they must do something to help out the people in the west.
The dairying industry is the most important industry in Canada. It has been operating under very difficult circumstances, because there has not been sufficient control. Last year butter production flooded our market, and that flooding has proceeded to such an extent that this year's production will be in

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competition with that of last year. Consequently I say that type of production must be controlled, and I hope legislation may be brought in which will help that situation.
I should like to see the Department of Agriculture encourage the manufacture of cheese to a greater extent, so that butter could be sold at a suitable price. The surplus production of milk could thus go into cheese production, and could be sold on the British or other markets. If that cannot be done, and if the price is to be fixed on other agricultural commodities, then we contend that there should be a guaranteed price for butter fat, and that it should be about 28 cents a pound, to cover the cost of production.


Agnes Campbell Macphail: Mr. Chairman, I wish to speak as one easterner to another. I am very much aware of the fact that agriculture generally is in difficulties-and indeed stronger language than that could be used, and still be true. I am aware, too, that the farmers of Ontario and Quebec, in fact of the five provinces which met recently in Montreal at the eastern Canada conference, will not be satisfied with the legislation now before us. I know that in the minds of the farmers of Ontario, and I am sure in the minds of the farmers of the other provinces represented at that conference, there is the idea that they want boards with power which will give them control over their own production. There is a growing realization that little can be done with a majority of producers, and that they must control the whole commodity group. Each commodity must have control by the producers themselves. However, at the moment I am not going to discuss that point at greater length.
I know we are working towards a two-price agricultural policy, especially in connection with those products of which we export very little, but the export price of which depresses the whole domestic market. The farmers- and this is odd, too-without having met together or having studied it, say, "We have got to quit this nonsense. There is no use in ten per cent or two per cent or three per cent of an exportable surplus depressing the whole domestic price." And so agriculture everywhere, and certainly in the eastern provinces, is working towards a two-price system, or a two-price policy. They will not care much about the bill; in fact I do not. If it is a feeder or educator, I suppose it is all right to pass it. But I do not think it is much good, really. It certainly falls short of what the farmers want.
I should like to ask the hon. member for Prescott-and I would ask him to listen to
this, if he will-what he thinks would happen to the cheese and butter industry in Ontario if the 30,000,000 acres in western Canada or an equivalent area, now devoted to the growing of wheat for export-or what has formerly been the export market-were turned into mixed farming in western Canada? I think it is time easterners realized that if that surplus acreage in western Canada were turned into mixed farming the distressed area in agriculture, which has been confined to western Canada, would then be spread over the whole agricultural field. What is now a wheat surplus would become a butter surplus, a cheese surplus, a bacon surplus, a beef surplus, an egg surplus-in fact a surplus of almost any agricultural commodity of which you can think.
I do believe that the dairying industry is important. I believe, too, that mixed farming is important. But just as wheat growing in Ontario was ruined by wheat growing in the west, due to fertile soil and large scale production, so if we persist in driving the wheat grower of western Canada to a subsistence level or lower, we shall turn those farmers on the prairie towards mixed farming, and thereby rain eastern agriculture. If we are going to deal with the agricultural problem, let us deal with it as a Canadian problem. The wheat growers of western Canada extended their, acreage under the pressure-I think that is the right word to use-of the government during the war, and wheat became the important export industry. Surely we are not going to say as a country that we cannot carry the burden of surplus wheat, but that the farmers themselves should carry it. That is not logical or right. While we are passing through a period of adjustment we should be ready to bear each other's burdens. Eastern Canada is simply fooling itself if it believes it can save money by not voting a good price for wheat. I shall come to that question a little later on, as I do not want to get off my present subject. However I referred to it because it was mentioned by the hon. member for Prescott (Mr. Bertrand). If he wants to ruin the dairy industry of eastern Canada let him turn the west into mixed farming.
The thing that pleased me most in Montreal was the growing unanimity of agriculturists throughout Canada. The Minister of Agriculture (Mr. Gardiner) was there only an hour or two, while I was there two days. I wish I had stayed all the time. It was more important than the Commons. He must have noticed that the farmers' organization that we have now is not a minor organization or a

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minor movement. They are not striking a minor note at all. They are not telling about their own problems and saying, "please, dear government, do something for us." They are better informed as to their problems than is the government. They have their own statisticians and their own economists and they know what they want. They are not interested in politics, they are not interested in this or any other government except that they get from the government what they require for their industry. All these things are new. It is a major movement, they are striking a major note. They are not saying, "We want something done," they are saying, "We want this done and, if you like, we will draft the bill." That is an encouraging thing. The leaders of agriculture in every province realize that you cannot isolate the wheat problem, the dairy problem or any other agricultural problem. The problem is a national one and it must be tackled by the combined thought of all agriculturists. Do not let us try to settle this problem by forcing down the price of wheat.


The CHAIRMAN:: I would point out to
the members of the committee that a discussion of wheat is really not in order on this bill.


James Garfield Gardiner: We did reach an agreement that we could discuss things in general on the next bill, and I think it would be as well to enforce that agreement and not enter into a discussion of other matters at this time.


Frederick George Sanderson: I would point out to
hon. members that they should confine their remarks to the agricultural products referred to in this bill. I think almost every agricultural product is named except wheat. Perhaps we should get along better if we confined ourselves to the matters covered by this bill, and wheat can be discussed on the bill that follows.


Mr. JOHNSTON (Bow River):: Mr. Chairman, I do not think it is a fair inference to draw that the western members are against the agriculturists of eastern Canada. That is absolutely not the case. We have always contended that agriculture should be put on a business basis. As the hon. member for Grey-Bruce (Miss Macphail) has pointed out, the agriculturists all over Canada are most conversant with their problems, possibly more so than the members of this government. We have always contended that agriculture should be on a business basis. We should stop this fooling around with this problem. The dairy industry of eastern Canada should receive at
[MiSvS Macphail.]
least the cost of production, and the wheat producers of the west should also be on a cost-plus basis. I think it is unfair to say to eastern Canada or to western Canada, "We will give you a minimum price of 60 cents per bushel," when there is no basis of fact for deciding upon that amount. Every consideration should be given to the cost of producing cheese, wheat and so on. In view of the careful consideration that has been given to the agricultural problem, both in the east and in the west, I do not think there is any question as to what the costs of production are.
I know some may say that costs vary in different localities, but an average could well be struck for both the dairy and the wheat industry. When we are referring to these two industries of the agricultural east and west I think it is only fair to mention the other industries of Canada. They should be on exactly the same basis. The dairy industry of eastern Canada should not have to pay exorbitant prices for its cream separators because of the protection the manufacturers receive under the tariff. The manufacturers of cream separators and farm machinery are guaranteed their costs of production.


Mr. DUPUIS:: They enter free.


Charles Edward Johnston: The farm machinery used in the west does not enter free. There is a certain point at which adjustment should be made. For instance, if the eastern dairy farmer is allowed to have his machinery come in free, is there any possible excuse for not permitting the western farmer to have his machineiy come in free? If the manufacturing industry is to be protected, then by all means we must protect our agriculturists both in the east and in the west.


Mr. SPENCE:: The hon. member would not protect the manufacturers.


Charles Edward Johnston: We have protected them to the extent of $50,000,000 a year ever since western Canada was opened. It is estimated that there are something like
60.000.	000 acres under cultivation in western Canada. If these farmers have to produce at less than cost, at least half of that acreage, or
30.000.	000 acres, will be thrown out of production. What are the people now living on that land going to do? There is only one course they can take, they will go into mixed farming. Let me say to the hon. member for Prescott (Mr. Bertrand) that I am firmly convinced that if western Canada goes into mixed farming it can beat the east all to pieces. There is no question about that. Then what will be the condition of eastern Canada?

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Agnes Campbell Macphail: We will have to grow onions like Hepburn.


Vincent Dupuis: They cannot grow anything but wheat in the greater part of the west.


Charles Edward Johnston: We should get down to facts instead of just fooling around with this matter. We should not say that we will allow 60 cents for wheat or 28 cents for cheese when we do not know the exact costs of production. Let us get down to a business basis and establish costs of production the same as is done in other industries.


James Garfield Gardiner: Does my hon. friend think that in addition to regulating prices we can go so far as to say what cost a man must put on when producing a particular commodity?


Charles Edward Johnston: I do not think we could say what cost he must put on, but we should find out what the costs are.


Vincent Dupuis: That is quite different.


Charles Edward Johnston: We should have a yardstick with which to measure costs.


James Garfield Gardiner: Is it not true that in producing a certain product one farmer might put on considerably more cost than another?


Charles Edward Johnston: Surely, and then it depends a lot on the yield. One farm may be a poor farm, while a farm just across the road may be good. There would be a variation in costs, but there should be no question as to the average cost. When it is well established that the cost of production is over 60 cents, I do not think there should be any argument that the price should not be above that amount.


James Garfield Gardiner: You would have to regulate it all. I think you would have to regulate the activities of the person who was producing in order to keep his costs of production at the level you have set.


Charles Edward Johnston: I do not think you would have to regulate at all. It is just a matter of estimating the cost; and surely western Canada has done so much in regard to estimating costs of production that there should be no question about it.
We hear a great deal about over-production. Much has been said about stimulating the cheese industry. But if we do not give the west a fair deal there is no question that there will be a greater production of cheese in the west through creameries coming into the production of that commodity. We are continually complaining in this house about
surpluses of wheat and other agricultural products, yet every one of the immigrants who are being brought in-and I do not say that they should not come in, if the government sees fit-is being put on farms, and for what purpose? To increase what is already a surplus. That is not businesslike, it is not logical, it is not common sense.


Vincent Dupuis: That is, assuming the farming to be on a commercial basis.


Charles Edward Johnston: I assume that is the purpose of the government. These immigrants are being put on farms, not any place else; and you are causing them, whether they like it or not, to increase our already great surplus.


Mark Cecil Senn: Would the hon. member put them in the cities?


Charles Edward Johnston: I do not care where you put them, but why put them on the farms so that they can increase production and add to the already insurmountable surplus?


Vincent Dupuis: If the hon. member will allow me, I will say that in eastern Canada the peasantry of Quebec-


Agnes Campbell Macphail: Not of Ontario.


Vincent Dupuis: Well, maybe Ontario too.


Agnes Campbell Macphail: No, not Ontario.


Vincent Dupuis: We do not want our peasants to make millions of dollars; we want them to find a way of life and bring up their children respectably.


Mr. COLD WELL:: We do not want a peasantry.


Vincent Dupuis: You want traders.


Charles Edward Johnston: We want people to have a decent living, but the policies proposed will put every farmer into the peasant class. That is the very thing we are objecting to.


Vincent Dupuis: These immigrants would be glad to earn their own living on farms.


Charles Edward Johnston: But how are they going to earn their own living on farms when they cannot sell the products they raise?


An hon. MEMBER:: They can eat them.


Charles Edward Johnston: They must sell their products at below cost.


An hon. MEMBER:: They cannot eat all the wheat.

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Charles Edward Johnston: It is time for us to quit playing petty politics and get down to a business basis. You cannot expect the industrialists of eastern Canada to sell their manufactured goods at less than cost; they will not do it. You cannot expect chain stores to sell at less than cost; they would close up, they would let the people of this country starve to death before they would consent to sell below cost. But we are asking the farmers to do that very thing, to keep on producing and producing, spending all their time and the little savings they have to produce below cost. The time has come when they cannot go on any further. I appeal to eastern members to look at this problem in a businesslike fashion. I assure them that no western member will vote against a bill to give the eastern agriculturist his costs of production, and I hope they will be big enough not to vote against any bill or suggestion from this side that will give the wheat growers at least their production costs.


Mr. ROBICHAUD:: I am again on my feet with reference to that famous expression " next preceding," which, as you know by this time, is like a red rag to my legal eye. I move:
That section 2, paragraph (c) (iii) be amended by striking out in line 31 the word "next" and substituting therefor the word "immediately."


James Garfield Gardiner: Agreed.


Louis-Prudent-Alexandre Robichaud: I believe that last night we were all agreed that the comma after the word " grain " in line S should be dropped.


James Garfield Gardiner: Yes. I am informed that it is not necessary to make a motion. It will be dropped. I think the proper place to discuss what we have been discussing lately is the next section, if we can get section 2 passed.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
On section 3-Payment to selling agency.
Mr. CLARK (Essex):: This bill may not be satisfactory to other agricultural producers, but it strikes me that it should be of real service to the tobacco growers, at least in times of emergency. I am sorry that the hon. members for Norfolk and Oxford are not in their seats; I believe they are ill; but the hon. member for Haldimand is close enough to the tobacco area to appreciate, I assume, that this bill will be really beneficial to the tobacco industry in times of emergency.


Mark Cecil Senn: I am afraid it is too late.


William George Clark: That may be found out this fall if this bill passes.


[Stage Direction]
Section agreed to.
Section 4 agreed to.
On section 5-Officers, clerks and employees.
Harry James Barber: What does the minister
mean by "such officers, clerks and employees"? Section 5 states that:
The governor in council may appoint such officers, clerks and employees as may be deemed necessary for the efficient administration of this act.
Would those be Ottawa or local appointments?


James Garfield Gardiner: They will be appointed in Ottawa to administer the act here.


Harry James Barber: I do not think it will ever be administered in British Columbia.


James Garfield Gardiner: In any case it will be administered from here.


Agnes Campbell Macphail: How are we going to train the farmer to understand cooperation if this measure is administered from Ottawa?


James Garfield Gardiner: This bill provides for the paying out of money, after it comes into operation, by the federal government, and there will have to be some office staff in order to check on these organizations. Section 6 provides for audits of their accounts and that sort of thing, and those audits will have to be filed here. We shall have to have a staff to take care of the administration.


Mr. BAKER:: It seems that every bill the government brings in provides for a great big organization which will eventually make more jobs for government employees in the city of Ottawa.


Agnes Campbell Macphail: I am almost inclined to agree, as far as this is concerned. The only benefit that this bill can provide, so far as I can see, is the initial money advance; but what the farmer will save by getting the money he needs at the time, without borrowing, will be offset to a great extent if there is going to be a large organization set up, which will be-


Harry James Barber: Overhead.


Agnes Campbell Macphail: Yes, but I am thinking particularly of the additional employees in Ottawa.


James Garfield Gardiner: I do not expect that this bill will be any further assistance to a cooperative organization than to help it in financing. I have in mind at the moment one

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organization which has already written in: it happens to be in the province to which I belong, and I know its condition better than conditions elsewhere. It is an organization of people who started very recently to grow alfalfa, in the constituency of the hon. member for Melfort, in an area which is particularly suited to the growing of alfalfa seed. To a large extent these people are farmers who moved into that area from the south country, which has been suffering from drought; and through examinations which have been made of their soil, many of them have found that they can grow alfalfa and do well by growing it, but they are without funds to finance their activities. They are located in an area which is confined entirely to this particular type of soil, just as the tobacco people of Ontario are located on a particular kind of soil. This bill would make it possible for these people to organize themselves into a cooperative for the purpose of selling their own product and getting the best possible price for it. They could apply to this government to be allowed to organize under this bill. If they so organized and conformed to the regulations set up under the bill they could get a sufficient advance from the banks or otherwise, on the strength of the credit placed behind them through this legislation, to pay out to every producer 80 per cent of the average price of the product for the last three years. This would enable him to continue to operate his farm until the product is sold and the price obtained for it, and the surplus to be divided among them is known. That is the kind of organization that can be set up. They can be assisted in financing the payment of a sufficient amount of money to enable the producers to live until such time as they have marketed their products, and that can be done in many localities.


Agnes Campbell Macphail: The local people would pay the interest.


Mark Cecil Senn: I think this is one of the best features of the bill.


Agnes Campbell Macphail: I think it is the only feature.


Mark Cecil Senn: I agree with the hon. member for Grey-Bruce that unless the cooperative idea is carried out in this bill it is not going to accomplish what the farmer needs mostly, namely, a successful method of marketing his products with some relation to cost of production, as one hon. member has said. Cooperative societies formed in times past for the purpose of marketing farm products have been altogether too short-lived and there is a good reason for that. The main reason 71492-228
is that although they have been quite successful for a short time, their success seems to have gone to their heads, so that from time to time they have branched out and got into deep water and in the end they were doomed to failure.
We have one particular example of what I would call successful cooperation in Ontario. Perhaps equally successful organizations of the sort exist in other provinces. I refer to the mutual fire insurance companies. These companies are under strict government supervision. In Ontario there is an insurance act that clearly defines the powers of each local farmers' company. Their books are subject to strict government inspection from year to year and that is a sound principle. Our banks, which handle the people's money, are under government supervision, and all our insurance companies are also under the supervision and control of the government and subject to inspection. Here is a cooperative organization that is handling other people's property. I think some check should be kept upon them from time to time to see that they are carrying on legitimately and do not get into difficulties financial or otherwise. In this case, the very fact that provision is made for auditors to inspect the books and see that they are carrying on legitimately will be a good thing for the cooperative societies and will probably contribute to their success more than anything else the bill will accomplish.


Major James William Coldwell: Will the employees to be appointed under the bill come under the civil service commission?


James Garfield Gardiner: They will not.


Major James William Coldwell: When this measure is proclaimed it will inaugurate a long term policy. It cannot be for a matter of months or a year; if it were, it would not be successful. I noticed the same provision regarding appointment in the bill that we passed yesterday, and I am wondering why so many statutes are being passed now placing so many employees beyond the jurisdiction of the civil service commission. In all these new bills we should endeavour to bring as many of the new appointees as possible under the commission, in order to remove them from the range of political patronage. Such action would strengthen this bill.


James Garfield Gardiner: All statutes of this
kind passed in years gone by have contained this provision. The Income War Tax Act, the Natural Products Marketing Act and the Prairie Farm Rehabilitation Act-all have had a provision similar to this. One of the reasons has always been that when they were

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set up in the first instance it was thought that they might be more temporary than some other activities that are carried on, and another reason is that many of these activities are carried on under the direction of some other body. If this becomes a successful setup, I presume there will have to be a body outside the department itself to take care of its activities. It might result eventually in what the hon. member for Grey-Bruce has been suggesting, so that there might have to be a board associated with it. For the time being we simply say that appointments are to be made in this way.
Section agreed to.
On section 6-Inspection and audit.


Thomas Miller Bell: We have the same
phraseology in section 6 as in section 6 in the other bill. Instead of the governor in council it speaks of the minister.


James Garfield Gardiner: I am quite prepared to accept the change, but in addition to that I should like to make an amendment to this bill, which we attempted to introduce into the other bill last night, but withheld in consequence of the representations of the hon. member for Kootenay East. I wish to have it in this bill, however. When I went to the office last night I received serious objections from an organization who consider themselves at least as important as the organization referred to here. They are an association of auditors and they regard themselves as just as important in the east as this organization is. I think it is unfair to permit one to do this work and not the other, and I suggest that an amendment be made, although I am not going to go back to the other bill in order to insert a similar amendment. That other bill can operate for a year without such an amendment.


Mr. CRERAR:: I move that the words
"a chartered accountant" in line 5 be deleted and that the word "an" be substituted, and that after the word "accountant" the words "or auditor" be added.


Robert James Manion: There was an objection
from this side of the house. I must confess that I am not thoroughly familiar with the titles by which members of this profession are designated, but it is a recognized profession throughout the country. These accountants audit large financial statements, private and governmental, and chartered accountants are recognized by a degree. If we leave out this qualification it seems to me that any man might be called in to do the work whether he was properly qualified or not. Personally

I should like to have an explanation from the minister as to why the change is being made.


James Garfield Gardiner: Last night when I went to my office the matter was brought forcibly to my attention in a communication from an organization of auditors in eastern Canada, who, my officials inform me, do a great deal of this work, and are just as well qualified to do it as what are generally known as accountants. This is an organization which is set up and, I think, properly constituted in the eastern provinces, and it is the desire of the department that we should not discriminate between them. Both groups are well qualified. I do not think there is any choice so far as qualifications are concerned, but the one group call themselves an association of auditors and the other an association of accountants. I understand that the one group are just as [DOT]well qualified as the other to do the work.


Robert James Manion: What the minister says may be correct, but it seems strange to me that any group of auditors sufficiently well equipped to audit large accounts for a government should not have in their firm chartered accountants. It seems to me that to-day all financial accounts are audited by chartered accountants. Take, for example, the Canadian National Railways; we had a group, a firm of chartered accountants, appointed to audit the books. True, the auditors were changed by this government, but they also appointed chartered accountants. I do not understand yet why a protest like this should be sufficient to cause this change. Far be it from me to wish to prevent any sufficiently qualified auditors from doing work of this kind; I do not wish to prevent any men who have a right to do a government job from doing it; but I submit that there should be chartered accountants to audit matters such as this, which may run into tens or possibly hundreds of thousands of dollars.


Vincent Dupuis: I would call the attention of the leader of the opposition to the fact that chartered accountants in this country, at least in eastern Canada, are not very numerous. On the other hand there is an association of qualified auditors and accountants with experience over a long period who have done, as the minister said, efficient work similar to that which will be required under this bill. If the bill limits the selection to chartered accountants I think it is unjust to the other association, and moreover it might not be possible for the department to find a sufficient number of chartered accountants to cover the

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needs of every department of this government. I know, as a matter of fact, that the examination of the chartered accountants is a very hard examination to pass.


Robert James Manion: Yes; to-day it is a profession.


Vincent Dupuis: It is a profession, and it goes into all the technicalities of something much more difficult than is required for auditing the business of a body like this.


Major James William Coldwell: Before we consent to the change might we know whether these are two professional bodies having equally stringent qualifications, because in the examination of books of organizations such as we are considering at the moment it strikes me we should have properly qualified and recognized accountants? I do not know anything about this association of accountants, but I know that all over Canada the degree of chartered accountant really means something. We want to be sure that in approving the suggestion of the minister we are not simply handing the matter of auditing over to an organization which perhaps does not demand the type of qualification that is required. If, on the other hand, it is a recognized accountancy degree, substantially equal to that of chartered accountant, I have no objection. But I should like to know exactly what is meant by "accountants."


Vincent Dupuis: I am not an accountant myself, but I know both associations and I want it to be well understood that I am not against the chartered accountants. On the contrary I am glad that we have that type of qualified auditors and accountants in this country. They are very highly qualified. But I submit that it is not absolutely necessary to have so highly qualified auditors for the purposes of this bill.


James Garfield Gardiner: These are just as highly qualified.


Vincent Dupuis: And those auditors are just as highly qualified. I have in mind a man of that type whom I know perfectly well, who is an auditor and accountant but not a chartered accountant. He has 'been employed for many years by large companies to audit their business, and has done so to the satisfaction of these companies. If these big companies have been satisfied with such auditors I think the body which is now set up by the bill could give equal justice to both parties.


Robert James Manion: I was going to make the suggestion that we might put in the word "qualified." I realize that what the hon. member states is true, there are many men
who have been accountants for many years who have not had an opportunity of taking a college course and getting the degree, but who have become what we might call practical chartered accountants. Certainly I have no intention of limiting the work in that way. But I believe some method should be devised whereby we could be sure that they would be well qualified to do the work. I have the idea that if you insert the word " qualified " ahead of " auditors and accountants," it would pretty well cover what is desired, without doing an injustice to some group who perhaps have-been auditing for many years but have not the degree.


James Garfield Gardiner: There is no objection to putting in the word " qualified."


William Hayhurst: Putting in the word qualified " would not carry the same weight as what the hon. member for Rosetown-Biggar said, because the word "qualified" usually means by examination or something. How about changing it to " competent "?


Agnes Campbell Macphail: They all think they are competent.


Mr. DUNNING:: I would point out that the value of the word " chartered " lies in the fact that it gives assurance of qualification. The minister in making his selection would be confined to those who have recognized qualifications which, by reason of years of use, have become generally known and appreciated. There is, I am sure, as the hon. member who has just spoken said, a situation in the province of Quebec unlike that which exists elsewhere. There is in that province an organization known as the General Accountants' Association. That organization, of course, sets up qualifications for its members not quite of the sort set up for chartered accountancy, which is a matter of university degree and so forth. But I believe it should be made possible to use members of such an organization as that which exists in the province of Quebec, although I must say to my hon. friend that I do not know of the existence of any such organization in any other province of Canada. In every other province I believe that for audit work requiring a member of a profession which has certain definite and known standards, one gets a chartered accountant. If the word " qualified " or "competent" is put in ahead of the word auditor " it simply throws upon the minister the responsibility of deciding who is and who is not competent.
In my experience with cooperatives, which goes back quite a long way, may I say that they have paid very dearly in some instances

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for saving a little money by getting-I will not say an incompetent auditor, but one so called whose work in subsequent years was revealed as not having been in the best interests of the organization. There ought to be some way of meeting this situation, which I think exists only in Quebec, without taking away the requirement in regard to chartered accountants in the rest of the country. That is a suggestion I offer the minister.


James Garfield Gardiner: I think the committee
is losing sight of the fact that these auditors are engaged not by the cooperative associations but by the governor in council. We decide what accountants we are going to engage, and this wording makes it possible for us to engage these people, who, I understand, operate in seven of our cities and have around eight hundred members.


Vincent Dupuis: Would the minister mention the cities?


James Garfield Gardiner: The cities are not listed, but in their own letter they make the statement that they are operating in seven cities throughout Canada.


Major James William Coldwell: Could the word "recognized" be inserted? That would cover both the Quebec group and the chartered accountants, who are recognized by university degrees.


James Garfield Gardiner: I should think you
could safely leave it to the governor in council not to select accountants who were not properly qualified.


Mr. LAWSON:: In the province of Ontario there is a very large body of auditors who are known as C.P.A., or certified public accountants, who grew out of the old licentiates in accountancy. They would be wrathy if anyone suggested they were lacking in any qualification, although the fact is that they have not been admitted, and possibly could not obtain admission, as chartered accountants. Still, they are highly skilled.


Louis-Prudent-Alexandre Robichaud: I should think we
could easily leave in the word "chartered" and have it read, "by a chartered or otherwise qualified accountant." That would take in the two organizations.


Vincent Dupuis: I am glad that wrong impression in regard to the province of Quebec has been rectified. I was surprised to hear from the Minister of Finance that in this field of activity also we form an exceptional group. In some instances I am proud of that; in others it reflects very greatly on my province. As one hon. gentleman opposite ;has explained, there is a very large body of
.
otherwise qualified accountants throughout the country who are not chartered accountants but who have rendered efficient service as auditors. As the clause is drafted, I think it should be acceptable to the committee.


James Garfield Gardiner: A suggestion has been
advanced which, I think, might meet all the proposals that have been made; that is, that we use the words, "professional accountant or auditor" and I move accordingly.


Major James William Coldwell: And what about the
other amendment in regard to the governor in council?


James Garfield Gardiner: I would suggest that we accept that also, as we did in connection with the bill that went through last night. So I would move that after the word "minister" we insert the words that were used previously, "with the approval of the governor in council."


[Stage Direction]
Amendments agreed to.
Agnes Campbell Macphail: I want to ask the
minister if "processor" means a cooperative processor. The section says "every cooperative association or processor." Does that mean a cooperative processor or any processor?


James Garfield Gardiner: A group of processors, perhaps a group of cheese factories or a group of creameries, might associate themselves together in order to market their product, and of course in that instance they would be a cooperative set-up. In addition to operating under this bill, they might make use of the Cold Storage Act, under which the government may pay 30 per cent of the cost of a cold storage plant. In other words, if an organization desired to take advantage of the higher prices for butter which usually exist during the winter as compared with the summer months, and wished to look after its own storage instead of shipping the butter out and placing it under the control of speculators, it could do so by working under the two bills.


Agnes Campbell Macphail: But in that instance
the first unit, we will say a cheese factory, would not necessarily be a cooperative cheese factory? The association of cheese factories might be either cooperative or privately operated factories?


James Garfield Gardiner: Yes.
Section as amended agreed to.
On section 7-Coming into force.


Vincent Dupuis: As the representative of a rural section I think it is my duty to say just a word before this bill passes. The

Prairie Farm Assistance
Minister of Agriculture, I am proud to say, has done his utmost to come to the rescue of our eastern farmers, among whom of course I include the farmers of Quebec. So far as dairy products are concerned, as this committee knows, the minister has taken steps to utilize the surplus butter in Canada by distributing it to poor people and those on relief. This question of cheese is also a vital matter to our farmers, and I should be glad if at the first opportunity a change could be brought about in what the minister has already done in connection with paying a premium on certain grades of cheese. If my understanding is correct, there is a two cent premium on grade lA and a one cent premium on grade IB. I want to ask the minister and the government, after they have had experience with this legislation, to go further and give a premium of one cent on grade 1C. As hon. members know, grades A and B are very difficult to produce, and because of that only a few hundred pounds of these grades are put on the market. I know it is the intention of the minister to help the eastern farmer as he has so ably helped the farmers of the west, in which course we in the east have gladly supported him both in the past and at this session.
Some hon. members opposite have spoken of their goodwill towards the east. Well, the east has always shown its goodwill towards the west, and we are ready to continue in that spirit of cooperation. I am sure hon. members from the west will not only agree that the east should have something, but insist that the Minister of Agriculture help eastern farmers a little more. I know the farmers in my constituency are pleased to see that something has been done for the butter producers. Irrespective of party allegiance, we receive letters of satisfaction. The action the minister has taken will be an encouragement to everybody, and I presume it will be an example to the premier of Quebec who, in 1936, promised a premium to the butter and cheese industry. However, on account of the many difficulties he has encountered, it would seem that he has forgotten to carry out his promise.
May I congratulate the federal Minister of Agriculture upon setting such a good example to the premier of Quebec. I am convinced that the premier, who is an intelligent citizen of our province, and a good Tory -among the Tories there are intelligent people-would do well to follow the example given by the minister in Ottawa. It is because I believe that Mr. Duplessis is an intelligent man that I am sure he will soon follow the
example of the Minister of Agriculture in the federal government, and give a premium on dairy products.


Mr. TUSTIN:: As I understand it, this is a cooperative and voluntary scheme. When a certain number of producers have signified their intention of cooperating, it would seem the minister will say whether or not arrangements shall be entered into. If the minister decides that 75 per cent of the producers of a certain commodity in a certain area is a sufficient number to ask him to put a cooperative marketing scheme into effect, in what position are the other 25 per cent of the producers? Do they come under this marketing legislation, or have they the right to market their own products?


James Garfield Gardiner: There is nothing in the bill permitting the minister or anyone else to compel the other 25 per cent to come in. They would be brought in only as a result of the activities of the cooperative being successful. They would come in voluntarily, of their own free will.


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


[Stage Direction]
Hon. J. G. GARDINER (Minister of Agriculture) moved the second reading of Bill No. 83, to assist agriculture in the prairie provinces.
He said: Mr. Speaker, I believe it was agreed yesterday in the house that when we reached Bill No. 83, considerable latitude would be given in a discussion of the whole wheat question. It was understood, as a matter of fact, that we might discuss the matter in relation to the bill with which we have already dealt, as well as in relation to Bill No. 63. In view of that fact I believe I should express certain views with regard to the legislation, and perhaps do so more extensively than I did when discussing Bills 82 and 89.
I think it advisable that in the first place we have a historical sketch of the activities in connection with the growing of wheat in western Canada, as well as a short historical sketch of the different methods of marketing which have been followed. The hon. member for Grey-Bruce (Miss Macphail) stated a few moments ago that western Canada had to some extent been responsible for putting other parts of Canada out of the wheat growing business. I think all hon. members realize the truth of that statement. Wheat growing
362S
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[Stage Direction]
first started in Canada on an island at the mouth of the St. Croix river, in the days of the very earliest settlement of the northern part of this continent, and extended gradually farther westward. The history of wheat growing on this continent, whether it be north or south of the United States boundary line, is the history of the gradual movement of wheat growing, westward across the continent. At one time I believe even spring wheat was grown, and very successfully, in the eastern part of Canada. At a later period they were able to grow winter or fall wheat, and grow it successfully. As a matter of fact, people in eastern Canada still have success in growing winter or fall wheat.
When the western plains, both north and south of the boundary line, were opened up, wheat of a different variety was grown in the western sections, and more particularly in those sections far to the north. No. 1 northern Manitoba wheat, or similar varieties grown in the United States, is grown only in the three western provinces and in those states immediately south of the United States boundary line. In spite of the fact that we speak of the United States as having produced in the last year over a billion bushels of wheat, I believe there were only about 225,000,000 or 250,000,000 bushels of that wheat which were of the spring wheat variety. That must have some bearing upon our discussion of the question of wheat growing in western Canada.
I believe I should repeat, however, that as we opened up the western plains and began to produce wheat on lands which in the beginning were very much lower in value than lands upon which wheat had previously been grown in eastern Canada, those in eastern Canada who had previously made their living by the growing of wheat had to stop growing it, and permit people in the west to grow the bread varieties. The wheat grown to-day in Ontario and Quebec is used, largely, for the purpose of producing pastry flour or flours used in the making of biscuits. Very little of it. excepting quantities used for mixing, is used for the purpose of breadmaking. We in western Canada have taken the place of people in other parts of Canada in producing the bread-making varieties of wheat.
Another point we should remember is that other countries are producing wheat for export. Three other countries now exporting a considerable proportion of their production are Australia, the United States and the Argentine. Recently we have read reports of a conference held in the past few weeks in London. It will be recalled that newspaper reports have indicated that this very question is determin-

ing the actions which at least some of these countries intend to take in relation to any arrangement that may be made as a result of that conference as to price levels, quotas or anything else relating to the production of wheat. In 1933 one of the great wheat producing countries, the Argentine, upset an arrangement which was about to be entered into as a result of a conference which had been held in London for the control and production of wheat in the great exporting countries. Argentina refused to agree to the terms of an agreement which had been discussed, and she would not become a signatory to it.
My understanding is that those who have been representing Argentina at the conference recently held in London have been taking the position that wheat can be grown at a certain price in that country. They contend that because it can be grown at a certain price, they are going to sell their product at a price based upon that cost of production. After all, that is the position that we have all taken. In relation to this and to every other farm product we have taken the position that when we can produce at a certain cost we will attempt to sell the product in any market available to us. The Argentine took that position in 1933, and they are apparently prepared to take the same position now.
We are then confronted with the attitude which will be taken by the great consuming countries. Only five or six per cent of the people of Great Britain are engaged in producing food products, ninety-five per cent of them being consumers. That country is compelled to decide whether she is prepared to pay a price higher than that at which someone else is willing to offer a product. I think if we will take human nature into consideration we will eventually come to the conclusion that great consuming communities like Great Britain are, generally speaking, going to buy their food products in the market where they can be obtained the cheapest. We in Canada will probably be more or less affected by that fact in connection with any policies which we may lay down relating to our wheat. It is quite close to six o'clock and I would prefer to defer any other remarks I have to make on this matter.
Charles Hazlitt Cahan: The last time I was in Argentina was late in 1935. At that time I ate in the hotels and private residences bread which had been made from Argentina wheat. I do not wish to say anything deprecatory of Canadian wheat, but I must say that that bread was as fine as I have ever eaten in my life. When I returned to Canada I men-

Universal Eucozone Limited,
tioned this fact to a gentleman who is even older than I. I told him that Argentina bread seemed to be better than any wheat bread I could get from the bakers in Montreal. He said to me, "Probably you remember the bread your mother used to make? The wheat then used in making bread in eastern Canada was a soft grade of wheat and you became accustomed to bread made from soft wheat." I should like to ask the minister if it is true that Argentina wheat can compete with the best Canadian wheat in making bread?


James Garfield Gardiner: The answer to that
question is rather long. Our wheat is sometimes spoken of as being the best in the world. It is known as a strong wheat and we get a premium for it because of its strength. It is a high protein content wheat and it makes a very light bread, compared with bread made from the winter wheat which was grown in Ontario years ago. If you take a slice of bread made from this wheat and feel it, you find it is much lighter than bread produced from the other type of wheat. I understand Australian wheat makes a much whiter bread than ours and is used in the blend to improve the quality. I do not know exactly the qualities of Argentina wheat, but it differs from our wheat and has its own advantages. The Minister of Mines and Resources (Mr. Crerar) tells me that the wheat grown in the southern provinces of Argentina is similar to ours. The millers take these different wheats. They have them chemically analysed and know exactly what the different mixes will produce. They are able to produce a certain type of bread by using different percentages of these different wheats. There is usually a premium paid for our wheat over what is paid for the Argentine or Australian wheat, but I do not think it is correct for one to say that in, every sense our wheat is better than other wheats.


Major James William Coldwell: May I ask a question
now, which perhaps the minister can answer later? Could he tell us something about our policy in relation to the international conference which has been mentioned? This might have some bearing upon a discussion of these bills.


James Garfield Gardiner: We have perhaps been
using the wrong term, because it is not the conference that is sitting at the present time. What is sitting now is a committee which was appointed to lay out a program. If an agreement can be reached, a conference will be held.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.



PRIVATE BILLS


[Stage Direction]
The house in committee on Bill No. 102, to
incorporate Universal Eucozone Limited- Mr. Lawson-Mr. Sanderson in the chair.
Sections 1 to 6 inclusive agreed to.
On section 7-Application of the Companies Act, 1934.
Mr. RINFRET:: I have no objection to the bill. I just wanted to know why section 7 reads the way it does, setting aside certain conditions and excepting others from the Companies Act. If the mover has not the information with him I will not press my point.


James Earl Lawson: I can give a reply in a general way. This company will have an international business in several countries. It is being incorporated for the purpose of taking over a United States corporation and a Canadian corporation already in existence. By reason of its international transactions in several countries, those provisions of the Companies Act which are excepted here would be extremely burdensome and inconvenient to this company, and those which are being excepted the minister would not, I am confident, require of this company in connection with carrying on its international operations.


Louis Édouard Fernand Rinfret: All right. Carried.


Mr. YOUNG:: What kind of business does the company carry on?


James Earl Lawson: Apparently every antiseptic is made by the dissolution of oxygen in some liquid substance. The inventor of eucozone invented a process whereby you can dissolve greater quantities of oxygen in oil of eucalyptus than in any other substance and by any other process previously known. The company has been carrying on business in a comparatively small way in the experimental stage with one company in the United States manufacturing and selling its product, and another company in Canada. The product has proven so satisfactory that arrangements are now being made to carry on the business in almost every important country in the world.
Bill reported, read the third time, and passed.
Central Finance Corporation



AGNES KEATING BIGELOW REDDY

[Stage Direction]
The house in committee on Bill No. 106, for the relief of Agnes Keating Bigelow Reddy -Mr. Hill-Mr. Sanderson in the chair.
Sections 1 and 2 agreed to.
Frederick George Sanderson: Shall I report the bill?


Mr. MARTIN:: On division.
Bill reported on division, and read the third time and passed.



CENTRAL FINANCE CORPORATION

[Stage Direction]
The house in committee on Bill No. 20, respecting Central Finance Corporation and to change its name to Household Finance Corporation of Canada-Mr. Macdonald (Brantford)-Mr. Sanderson in the chair.
On section 1-Change of name.
Mr. LANDERYOU:: We have before us here a private bill entitled "an act respecting Central Finance Corporation and to change its name to Household Finance Corporation of Canada." Can the minister give us any reason why this bill should be brought in when we have already passed a bill with respect to small loans companies? Why should this private bill be brought in?


Mr. ILSLEY:: If the hon. member is referring to me, I am not bringing in this bill.


John Charles Landeryou: Well, whoever is
responsible for it.


Mr. MACDONALD (Brantford):: There
are several reasons for the introduction of the bill, one being to change the name of the company. If hon. members will observe, in the small loans companies bill the name is given as Central Finance Corporation, and it is desired to change it to Household Finance Corporation of Canada.


John Charles Landeryou: Was it necessary for them to have a special bill before they could change their name? Could they not come under the bill that has been passed and have the change made?


William Ross Macdonald: There was no ground at that time on which the name could be changed. At the time the small loans companies bill was passed the company was known, as it is at the moment, as Central Finance Corporation, and the general legislation did not take cognizance of the desire of any private company to have its name changed. To do so, it would have been necessary to inquire of every company whether it wished to have its name changed, and that would hardly have been feasible. The

only method by which this company's name can be changed is to amend its act of incorporation.
Again, this company has a large investment in Canada and it wishes to preserve its entity. It is a separate corporation. As hon. members know, a company is incorporated either by letters patent or by special act of parliament, and the small loans companies bill will enable a company incorporated in one province to do business in another. It will supervise, regulate and control these companies. If a new company were being incorporated to engage in this form of business it would have to come to this parliament or go to a provincial legislature or obtain a charter by letters patent. The position of this company under this bill is no different from that of any company incorporated previously to carry on similar business. Any new company wishing to carry on business will have to come to parliament or obtain letters patent or be incorporated under a provincial act. This company wishes to have its act of incorporation amended.
It is conceivable, I may say frankly, that someone might attack this legislation as being ultra vires of parliament and might take it into the courts. The courts might agree with that contention. Personally I cannot see how they could, but that is conceivable; no one can foretell the result of applications made to the courts. Some hon. member might think the legislation could be attacked successfully. Assuming the act were attacked and declared beyond the powers of this parliament; it would be thrown out and the company's incorporation would go also.


John Charles Landeryou: Could they not come in under the new act?


William Ross Macdonald: But if the new act were declared ultra vires there would be no new act and the company would go back to its present act, which is unsatisfactory and which the superintendent of insurance has asked to have clarified. The result would be that they would have an unsatisfactory act, one which would allow them to charge a considerably higher rate of interest than under the private bill which is now before the committee. For these reasons I feel it is only fair to this company and to the interests of the borrower that the private bill should pass.


Thomas Reid: When the small loans bill was before the house for second reading I voted against it, and I was greatly surprised to be accused of being in favour of high interest rates, simply because I voted against that bill. I am not going into a lengthy argument on the pros and cons of the matter other than to

Central Finance Corporation
say that I am not in favour of high interest rates. The bill we are now discussing I opposed when it was before the house last year, and if there was any merit in passing the small loans bill it does not mean that the same merit attaches to the bill now before the committee. The argument used in favour of the small loans bill was that it would reach provincial companies which were charging rates of 100 to 200 per cent, and bring them within the act so that they could not charge more than two per cent a month. But if we pass this bill we give this company the right to charge two per cent a month, and I am absolutely opposed to that. I do not think enough information has been given to this committee. I object strongly to allowing a company which has its head or parent office across the line, and which, by the way,
I understand pays astoundingly large salaries, over $100,000 to the president, to come across here and obtain Canadian rights. For what purpose? So that they can exploit the Canadian people and use United States broadcasting stations to advertise this Canadian company. I do not think the committee is seized of what they are endeavouring to put over at the moment. So far as I am concerned I am going to oppose this bill to the best of my ability, because it is not in the same class as the small loans bill that we passed a short time ago.


John Charles Landeryou: As I understand the matter, this bill would grant a special privilege to one of these companies which as the hon. member who has just spoken has said, had its head office in Chicago or Delaware or somewhere else in the United States. The point is that they bring capital into Canada from the United States and, I understand pay 7 per cent interest for it to the head office; they fasten themselves upon the industrial areas in Canada and lend this money out to needy borrowers, those who have deficit incomes and who find themselves in need of small sums of money to tide them over an emergency. I cannot for the life of me understand why we should bring in private bills extending privileges to these companies rather than requiring them to come in under the act that we have passed. This bill would not come into force until January, 1940, the same time as the act which has already been passed dealing with small loan companies. No good reason has been shown to me why we should grant this special privilege. Is it to pull some chestnut out of the fire for these companies because of some decision that is to be handed down by the supreme court, or what is the reason why these bills are before us?


William Ross Macdonald: In the first place let me assure the hon. member for New Westminster that there is no attempt to put anything over on this committee. There is nothing hidden whatsoever, and the procedure in bringing this bill before this committee is, I can assure him, absolutely regular.
He mentioned high interest rates. At the present time the rates which are being charged by this company are higher than those allowed by this bill. I join with him in being opposed to high rates. He said someone accused him of being in favour of high rates. I do not think anyone would accuse the hon. member for New Westminster of being in favour of high rates. We all want to get the rates as low as possible. There was adduced before the committee plenty of evidence of rates in the neighbourhood of 1,000 per cent; actual cases were brought before the committee. That is going on in Canada to-day.


John Charles Landeryou: And we passed an act to stop it.


William Ross Macdonald: We
passed an act to stop it. Whether hon. members over there voted against it or not, I do not recall.


John Charles Landeryou: I voted against it.


William Ross Macdonald: But I do not think they want high rates to be charged any more than the rest of us. We are now in this position: If we continue to allow high interest rates, loan sharks will continue to operate. The Minister of National Revenue explained the conditions that prevail in this country, where those who can ill afford to pay were being charged the highest rates, rates which none of us would countenance. This bill does not authorize any such rate as that; the bill merely brings the act as it now exists into conformity with the present law. At the present time this company under its charter van charge in the neighbourhood of 2J per cent a month. As I pointed out in reply to the question of the hon. member for Calgary East, if for any reason the general act were declared ultra vires, the result would be that this company would then revert to its existing charter and charge a rate of 2i per cent. Do any hon. members want to allow this company to continue to charge 2J per cent?


John Charles Landeryou: No.


William Ross Macdonald: I am sure they do not. Well, this is one way to make absolutely sure that that state of things will not prevail. Then, if anything should happen

3t>32
Central Finance Corporation

to the general act, notwithstanding that, this company is going to be bound by the rate in its charter as we expect to have it amended to-day.
Someone has said-I believe it was the hon. member for New Westminster-that this company pays high salaries. Personally I know nothing of that. I believe there was before the committee some evidence concerning salaries, but I do not recall what those salaries were. But under the act the superintendent of insurance has power to examine the books of these companies. He has complete supervision of their operations and, if exorbitant salaries are being paid, when this bill is passed that abuse can be corrected.


Some hon. MEMBERS:: How?


William Ross Macdonald: He could report; the house could ask to have the report brought in, and hon. members would know definitely what was going on.


Charles Stephen Booth: How would it be
corrected?


William Ross Macdonald: The
superintendent of insurance could then advise the government of what was taking place, and it would not be a difficult thing to amend the act to make it impossible for these companies to pay exorbitant salaries. There would be no difficulty in the way whatever. The advantage under this act is that you can get the information; then, that information having been obtained, appropriate action can be taken.
It was also stated that these bills gave these companies special privileges. This act does not give any company any special privilege, because at the present time the Central Finance Corporation is incorporated by act of parliament. There is no special privilege about that. On Monday of next week a group of men could form a new company and ask for incorporation by this government, or they could go to a provincial government and obtain incorporation by letters patent or by an act of the provincial legislature. 1 have compared the acts carefully, and so far as I know there is no difference in regard to special privileges or advantages between the act now before the committee for amendment and the general act. As a matter of fact this amendment makes it easier for the superintendent of insurance to supervise the company than would be the case if the bill were not passed.


Charles Hazlitt Cahan: Would the hon. member
for Brantford City explain to some of us who have not closely followed these discussions exactly what is the difference in the rate (Mr. W. R. Macdonald.]
under the general act and the rate this company would be allowed to exact, provided the general act is not brought into force or, having been brought into force, was then declared ultra vires?


William Ross Macdonald: The
general act provides that the rate is not to exceed two per cent a month, which rate is to be all-inclusive. In the interpretation section of the general act the word "cost" is used, and the cost is to be an all-inclusive charge which, as I have said, is not to exceed two per cent a month. Under the bill now before us the rate also must not exceed two per cent a month, so there is no difference.


Charles Hazlitt Cahan: If my hon. friend will
permit me, I am sure he will frankly admit that the two per cent a month under the general act includes a number of other charges which could be added under this bill, if it should become operative.


William Ross Macdonald: No. The bill now before the committee sets the rate exactly the same as it is in the general act.


Charles Hazlitt Cahan: The rate may be the same in figures, but I understand that one includes certain other charges which the other does not. Is that not so?


William Ross Macdonald: No. The word "cost" is the same in the private bill as in the general act. The hon. member for St. Lawrence-St. George will notice in the general act a clause with regard to "rate of charge" and the exact wording of the general act is carried over into the private bill.


Charles Hazlitt Cahan: I only wish to be informed, but as I understand it, in the definition of "rate" there are words which include extra charges. Is that not so ?


William Ross Macdonald: No, there is nothing to be added to the word "rate." There is no difference whatever in the rate in the private bill and the rate in the general act.


Charles Hazlitt Cahan: I wish to have the facts clearly in my mind before voting, so I would like to ask another question. Let us assume that the general act is in force and is applicable to this company. Call that case No. 1. Then, as case No. 2, let us suppose the general act is no longer in force, because it has been declared ultra vires. In case No. 2 would not this company be authorized to collect more on its loan than in case No. 1?


William Ross Macdonald: That
would depend entirely upon whether or not this private bill is passed by this house and put into effect.

Central Finance Corporation


Charles Hazlitt Cahan: I am speaking of this bill as though it had passed.


William Ross Macdonald: At the present time the Central Finance Corporation is enabled under its act to charge a rate equal to about 2-t per cent a month. If a new bill is not passed, and if the general act should be declared ultra vires then the company would revert to the act in existence at the present time, which would allow it to charge up to 2i per cent a month. If the present bill is passed, however, even if the general act should be declared ultra vires this company would be bound by this act and would be limited to two per cent a month. There is nothing in the bill which enables it to charge in excess of the two per cent a month.


Charles Hazlitt Cahan: And the two per cent is not more inclusive in the one case than in the other?


William Ross Macdonald: That is correct.


Mr. VIEN:: In section 5, on page 2 of this bill, will be found identically the same language that appears in the general act with respect to the cost of the loan. One of the purposes for which these private bills are introduced is to reduce the rights and powers of these companies to the level defined in the general act, so that if the general act should be declared unconstitutional, in that it applies to other than federal companies, these companies which are the creatures of parliament would be restrained and restricted in their charter powers to the rights defined in the general act.


Charles Hazlitt Cahan: Frankly, then, accepting
those statements, I cannot see any objection to the bill.


Thomas Vien: If this bill should not pass and the general law enacted a few days ago should be set aside as being unconstitutional, this company would continue to operate under its present charter powers, and would be entitled to 2-J per cent a month as determined by the act of 1934. The superintendent of insurance and the Minister of Finance have insisted that these companies should come to parliament to have their charter powers clarified and restricted in the sense determined by the general act, and these bills bring the charters of these individual companies in line with the terms of the said act.


John Charles Landeryou: Is not the question of the legality of the rates being charged by these companies before the courts at the present time?
71492-220J


Thomas Vien: They are being challenged, and the Exchequer Court of Canada has interpreted their charter powers, as the companies have done. But the superintendent of insurance has appealed to the Supreme Court of Canada, and that decision has not yet been rendered.


John Charles Landeryou: If the general act is declared ultra vires, as has been suggested by the hon. member for Brantford City, would that not affect the rates contained in the private bill?


Paul Joseph James Martin: Certainly not, if this bill is passed.


John Charles Landeryou: If the rate of two per cent is declared illegal by the courts, how could a company continue to charge that rate?


Thomas Vien: The question before the
courts is not the rate of two per cent; the question is the power of the company to charge, over and above the rate of interest specified in their charter, for certain services, such as chattel mortgages, disbursements for professional fees, and other matters of that kind which are added to the interest charge. The act of 1934 prescribed a ceiling of 2J per cent all-inclusive. The purpose of this bill is to reduce that ceiling from 2i per cent to two per cent a month.


William Ross Macdonald: I may say, further, that the companies are before the courts at the present time because their powers are not clear. They are not set forth clearly in the charter, and that is one more reason for amending the act, namely, so that their powers will be clarified. As I said before, my advice is that the superintendent of insurance desires that their powers should be clarified.


John Charles Landeryou: What is the reason for changing the name from the Central Finance Corporation to the Household Finance Corporation? I understand that they have been operating for some time under the name of the Central Finance Corporation. Is the reason that the name has been discredited because of the conduct of their business, and that for that reason they wish to change it to the Household Finance Corporation, so that people will think they are dealing with a different company? Is that the reason, or is it because the word "household" indicates to the general public that this company is a benefactor of the householder, and that it is in business to serve the householder? I was
Central Finance Corporation

wondering if that were the reason, because in their advertising they seem to get that idea across.


William Ross Macdonald: That
answers the question, so far as my information goes. The fact is that the Central Finance Corporation has not been discredited by the public. It is one of the companies which has never had a case in the courts. My information is that the Central Finance Corporation has never brought anyone before the courts, and never sold anyone out for failure to pay money which has been borrowed.
The reason for the change is merely that the Household Finance Corporation owns all the capital stock of the Central Finance Corporation. It is a wholly owned subsidy of the Household Finance Corporation.


John Charles Landeryou: Of the United States?,


William Ross Macdonald: The head office is in the United States.


Charles Stephen Booth: Why make it a subsidiary company?


William Ross Macdonald: 
Charles Stephen Booth: Why change the name of this company?


William Ross Macdonald: The name will be the same. When the bill before the committee is passed, the name will not be different in this country from what it is in the United States. At the present time it is different, and that is one reason for introducing the bill, namely, to have the name the same in both countries.


John Charles Landeryou: The hon. member who has just taken his seat has pointed out that small loan sharks have been operating in this country and charging rates up to 1,000 per cent. He rightly suggested that this is absolutely going too far. He has suggested further

that these companies have been operating at a rate of 28 per cent over a number of years. We have already on our statute books an act entitled "The Small Loans Act, 1939," which restricts to 2 per cent a month the rate of interest to be charged by small loan companies. That amounts to a little over 26 per cent interest. I see no reason why, if this bill were not passed, there would be any danger of any company lending money to the public at 1,000 per cent interest, because we already have legislation dealing with that very matter.


Paul Joseph James Martin: The hon. member voted against it.


John Charles Landeryou: Yes, I voted against it, and I did so because I saw no reason why many thousands of people who have to meet financial emergencies, because of sickness in the family, or death, or because they are temporarily unemployed, should be subjected to those rates of interest. May I point out to the hon. member that many individuals in Ottawa have come to me and stated that they are working only part-time. Some of them are working part-time for the government of Canada; they may be working in or round the buildings during the session of parliament. They are laid off when parliament is prorogued. They may be able to carry on for a month or two on the money they have laid aside during their time of employment, but then may find themselves in need of some additional money to meet rent, or possibly to buy groceries or a pair of shoes. Those people may read an advertisement in a street car, or they may hear an advertisement over the radio suggesting to them that there is an institution prepared to come to their rescue. They are told how easy it is, that all they have to do is to go to the office of the company. They are told further, that everything will be kept confidential. They are asked to sign their names on the dotted line, to get the signatures of their wives, to put up some collateral by way of household furniture or something of that kind. At the conclusion of all that they are given a small sum of money-maybe S100 or $200. However, that may be a very large sum of money to people who are suffering from the need of income. As one hon. member has suggested to me, those companies will even take a loan on the gold filling in false teeth. I should not be surprised if they did.


Thomas Vien: Would my hon. friend think that the change of name from Central Finance Corporation to Household Finance Corporation would alter that situation in any way?

Central Finance Corporation


John Charles Landeryou: The change of name is not the only point set out in the bill.


Thomas Vien: We are discussing the change of name in this section.


John Charles Landeryou: This is "An act respecting Central Finance Corporation," and so on. In addition to that it is an act respecting the change of the name to that of the Household Finance Corporation of Canada. I suggest to the hon. member that changing the name is indeed a very good step, so far as the company is concerned. The name " Household " indicates that they are more or less dealing with householders. They are posing as benefactors to these householders because they grant loans on their stoves, on their beds and on their kiddies' soup plates. The workingman's friend!
As I say, the company get the signature of the wife and the other security I have mentioned. They lend $100, which is a large sum of money to those who are in receipt of a small income during the year. As I said, this money may be spent to buy a little clothing, some shoes and so on. They go up to the office every month to make a deposit. After paying the 26^ per cent interest month after month, a man finds himself in employment, and the company says, "You have cleaned up your bill; we will wait for another four or five months, and then you will be coming back to us again." It is the same old merry-go-round. The government finances these part-time employees part of the year, and the finance corporations from the United States finance them for another part of the year, but they charge 2&i per cent interest.
Is it any wonder that some of the heads of these companies receive $100,000 a year and, when they visit town, are able to eat in the big dining-room of the Chateau Laurier and carry on in a grand style? I believe the country would be better off if they brought in A1 Capone instead of this group of burglars. An interest rate of 26J per cent is absolutely outrageous. I would remind hon. members who are supporting this bill that they are members of a party that was considered to be a great monetary reformer. Before the election of 1935 they were going to carry on a great battle with the money powers. They have not put up much of a fight against these exploiters of the workers of Canada.


Mr. HANSELL:: "Usury once in control/'


John Charles Landeryou: Another statement was made, that "usury once in control will wreck any nation." The lives of these industrial workers are being wrecked through their becoming victims of these companies which charge 26i per cent interest. The business men of this country are being wrecked because of the money that is going to these loan sharks instead of into legitimate business.


Louis-Prudent-Alexandre Robichaud: This is a private bill, not a government bill.


John Charles Landeryou: It is a bill that is getting the support of a goodly number of the Liberal party, who were such monetary reformers before the election of 1935.


Mr. McNEVIN:: Who gave the hon. member authority to speak for the Liberal party?'


John Charles Landeryou: I am just quoting the-Liberal party. I am not speaking for the Liberal party and I hope I never shall.


Thomas Vien: This bill tends to reduce the rate of interest. If the bill does not pass the tesult will be the maintenance of high rates of interest.


James Earl Lawson: It is obvious that this bill is not going to be allowed to come to a vote this evening. There are several other bills ready for third reading and possibly this could be given before nine o'clock. I do not think these other bills should be held up because of the situation in connection with this bill. Therefore, I move that the committee rise and report progress in respect to this bill so that we may give third reading to the other bills before nine o'clock.
Progress reported.



CONSIDERED IN COMMITTEE-THIRD READINGS

[Stage Direction]
Bill No. 79, for the relief of Leslie William Bond.-Mr. Walsh.
Bill No. 98, for the relief of Helen Kerr Hogg Molson.-Mr. White.
Bill No. 99, for the relief of Adele Adfeldt Grunau.-Mr. Bercovitch.
Bill No. 100, for the relief of Jeanne Beauregard Desnoyers.-Mr. Bercovitch.
Bill No. 101, to incorporate The Association of Canadian Clubs.-Mr. Vien.
Bill No. 105, for the relief of Blanche Anna Bousquet Pepin.-Mr. Hill.
Bill No. 107, for the relief of Ethel Rothpan Staroselsky.-Mr. Factor.
Bill No. 108, for the relief of Myrtle Jane Ramsay Fox.-Mr. Hill.
Bill No. 109, for the relief of Joseph Maurice Durieux.-Mr. Factor.
Bill No. 110, for the relief of Dorothy Gertrude Mary Huggins Yaun.-Mr. Hill.
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[Stage Direction]
Bill No. Ill, for the relief of Lola Margaret Miller Atkinson.-Mr. Walsh.
Bill No. 112, for the relief of Zeno Brack- Mr. Plaxton.
Bill No. 113, for the relief of Esther Steinberg Soloway.-Mr. McNiven (Regina City).
Bill No. 114, for the relief of Sarah Sherry Miller.-Mr. Tomlinson.

[Stage Direction]
Bill No. 115, for the relief of Roberta Copeland Cool Roberts.-Mr. Ross (St. Paul's).
Bill No. 116, for the relief of Margaret Maud Turner Bell.-Mr. Walsh.
Bill No. 117, for the relief of Janni Kalmano-witz Rittner.-Mr. Factor.
Bill No. 118, for the relief of Ambrose Tibbitts Aston.-Mr. Ross (Moose Jaw).
Bill No. 119, for the relief of Anne Ver Trees Hart Acena, O.-Mr. Bereovitch.
Bill No. 120, for the relief of Dorothy Boretsky Pozomick.-Mr. Walsh.
Bill No. 121, for the relief of Elsie Victoria Oliver.-Mr. Factor.
Bill No. 122, for the relief of Doris Mabel Casselman.-Mr. Botlvwell.
Bill No. 123, for the relief of Kathleen Emma Gladys Smart Higginbotham.-Mr. Factor.
Bill No. 124, for the relief of Rose Edith Winer Bazar.-Mr. Macdonald (Brantford City).


[Stage Direction]
The house resumed consideration of the motion of Mr. Gardiner for the second reading of Bill No. 83, to assist agriculture in the prairie provinces.
James Garfield Gardiner: When the house rose at six o'clock we were dealing with the motion for the second reading of Bill No. 83. As was stated at that time Bill No. 63 is to be associated with Bill No. 83 in the discussion. Bill No. 83 sets up a fund which is to be collected from the farmers of the three western provinces, with the area in British Columbia known as the Peace River district being added to the province of Alberta for the purposes of this bill. In other words, one per cent is to be collected at the country .elevators on all grain delivered to the eleva-

tors in what is known as the spring wheat area, namely, the provinces of Manitoba, Saskatchewan, Alberta and the Peace River district of British Columbia. This amount of money collected is to be placed in a separate fund under the control of the treasury and is to be used for the purpose of making payments on an acreage basis, under certain conditions, to those who are farming in the particular area. One condition is designated in the bill as a national emergency, and the other is designated as crop failure.
Bill No. 83 is set up for the purpose of making possible the collection of the fund, the lending of money to the fund by the federal treasury and the payment out under conditions of national emergency or crop failure to the farmers throughout the area.
I do not wish to say more at the moment with regard to Bill 63 than this, that during 1939-40 it will be associated with Bill No. 83 in the making of payments to farmers in relation to wheat in the three western provinces, and there is provision in it for the board to apply the provisions of this bill to wheat in all the remainder of Canada, that is in British Columbia and in all of the eastern division in Canada. As there has been criticism of no provision being made in the previous wheat board bill for payments upon wheat in other parts of Canada, it will be noted that provision is now made under that particular bill.
I wish to state, too, that instead of leaving the setting of the initial payment to the wheat board with the approval of the government, the payment is now established in the bill at 70 cents for this year.
In addition to that, there has been a limitation of 5,000 bushels placed on the amount of wheat which a man can deliver at the 70-cent rate to the wheat board.
Those are the three changes which have been made in the legislation, compared with legislation which was on the statute books previously.


James Earl Lawson: Excuse me, I lost the significance of the previous sentence. What was it the minister said with respect to wheat delivered to the wheat board?


James Garfield Gardiner: There is a limitation of 5,000 bushels on the amount of wheat which may be delivered to the wheat board and for which the set sum of 70 cents can be collected by any one individual.


Mr. RICKARD:: Does that apply to
Ontario also?

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Mr- GARDINER: Those three changes have been made in the legislation, and that legislation is to be associated with this in giving assistance to farmers in the western part of Canada.
Having made these explanations, I desire for a few moments, as I stated before dinner, to discuss the grain trade and the production of wheat as it has been associated with western Canada.
Those of us who went west in the early part of the present century will recall that around 1900 Manitoba was looked upon as being the wheat producing province of Canada. It was producing in the neighbourhood of forty to fifty million bushels of wheat. By 1906, the first year in which we had the provinces of Saskatchewan and Alberta, Saskatchewan was producing annually about
35.000.	000 bushels of wheat, Alberta was producing annually about half that amount, and Manitoba was still producing annually about
50.000.	000 bushels. Many of the discussions which are still carried on in western Canada with regard to methods of handling wheat had their origin in the years 1900 to 1906.
We have now in this house three men who were closely associated with all the discussions of those days, and all three of them are occupying seats on the front benches on the government side of the house. One of them, the ex-minister of agriculture (Mr. Motherwell) in 1900 and 1901 led a crusade in western Canada against the activities of the railways in connection with the supply of cars for the shipping of grain which was then being drawn in to all the sidings and towns and villages of the western part of Canada. That crusade finally took shape in an organization known as the Territorial Grain Growers Association, formed, I believe, in the year 1901. Out of the activities of that organization grew most of the activities of organized farmers in what are now known as the three prairie provinces.
The first development of those activities which is associated with our discussions of to-night took place in 1906, when the Manitoba grain growers formed a company of their own to deal in wheat; and shortly after that the present Minister of Mines and Resources (Mr. Crerar) became the manager of that company. It operated for a number of years without a line of elevators, but has operated for many years with a line of elevators and to-day is one of the larger elevator companies in the prairie country. That company, to-day known as the United Grain Growers, because of a union which took place between the line of elevators in Manitoba and the line of elevators in Alberta, still considers
itself an organization of farmers associated with the farm movement which had its beginning in 1901, and distinct from what are known as the line elevator companies, because of its claim to be associated more nearly with the grain growers themselves.
Prom 1908 to 1910 there was a strong agitation in the western part of Canada for government ownership of elevators, and during that period Manitoba took over the elevators of the province and began to operate a line of government-owned elevators. Saskatchewan was the scene of a lively agitation during that same period for a government-owned system of elevators. A commission was appointed by the government of the province to investigate the advisability of adopting a government-owned system. That commission finally reported in favour of what came to be the cooperative elevator system of Saskatchewan, and the first managing director of that company is the present Minister of Finance (Mr. Dunning). So we have associated with the present government, in the persons of these three gentlemen those who have been most closely associated with the development of the cooperative farm movement in western Canada as it was connected with the wheat trade.
I thought it necessary to recite these incidents of the early development of the discussion in relation to the trade as associated with the producers themselves in order to indicate that we still have associated with the grain trade the Winnipeg Grain Exchange, which was formed first in 1901, and in its present form in 1904; we still have with us the United Grain Growers, the first farmers' company which was set up in western Canada; we have not the old Saskatchewan Cooperative Elevator Company, but to-day it is included in the pool elevator system of Saskatchewan; and we have, as well, many elevator companies which have grown up over the years, until to-day there are something over 5,000 local elevators operating in the different towns and villages in the prairie section of Canada.


James Earl Lawson: Apparently, although the shareholders of these different companies are themselves grain growers, the companies operate as private corporations, do they?


James Garfield Gardiner: They are not all grain
growers.


James Earl Lawson: Well, I mean, farmers.


James Garfield Gardiner: The United Grain
Growers operate pretty much as a line elevator company operates, but they have their
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local organizations all through the three provinces, and they hold annual meetings which are attended by representatives from these locals and discuss generally the problems of the farmer in relation to the grain trade. The line elevator companies operate their own elevators as a straight business proposition, not necessarily associated with the producer.
The Saskatchewan Cooperative Elevator Company's elevators became a part of the Saskatchewan pool system, and operate to-day under the pool, which does business very much as line elevators do it, but it has what it calls a democratic organization set up over it. That organization is composed of a board of directors and a meeting of delegates. The province is divided into sixteen districts. There are ten delegates elected from each of those districts, making a total of 160 delegates who meet in annual convention and also meet from time to time during the year to discuss the marketing problems of the farmer; and each one of those districts selects a member for the board. The president of the board must be chosen as a member of the board by the ten men in one of these districts before he is eligible for the office. That, roughly, is the form of organization which exists in connection with the pool set-up of Saskatchewan.
These pools were formed in 1923 and 1924- the Alberta pool in 1923 and the Saskatchewan and Manitoba pools in 1924. They handled approximately 50 per cent of the w'estern crop. The Saskatchewan pool handled a little more than 50 per cent, and the others a little under 50 per cent during the years between 1924 and 1930. Since 1930 they have not operated as contract pools in the sense that they did prior to that time.
In 1930, under the previous government, there was a set-up of the stabilization activities under the direction of Mr. McFarland. At the time he took control of the central selling agencies of the pool there -was a surplus of 36,935,000 bushels. At the end of that crop year there was a surplus of 75,164,000 bushels, and in 1935, when the Bennett government set up the wheat board under Mr. McFarland, there was a surplus or carry-over of 205,187,000 bushels. During 1935 about
90,000,000 bushels were taken over from the farmers or purchased by Mr. McFarland prior to the time the McFarland board was replaced by the Murray board in December, 1935. In the period during which the stabilization activities were carried on, there had been for part of one season a pegged price of 80 cents a bushel, and after the setting up of the McFarland board in 1935, the price

was set at 871 cents a bushel for the crop of 1935. In 1936 the pegged price was still 87i cents, but the present government established by order in council a regulation to the effect that unless wheat dropped below 90 cents on the market, the board would not take delivery of wheat directly from the farmer. The same condition prevailed in 1937. Then in 1938, the year with which we are now dealing, the price was dropped to 80 cents a bushel and the board carried on in exactly the same way as in 1935-36. That, in as few words as I can state it, is the history of the development down to the present time.
There has been a continuous discussion of the necessity-or otherwise-for a wheat board to handle the crop of western Canada, ever since the experiences of the war years; and those experiences are associated with very high prices. The first organization that might be considered to have taken the form of a wheat board was the board of grain supervisors set up during the war in June, 1917. That board was set up for the purpose of taking delivery of wheat and carrying on transactions between Canada and the boards that were controlling supplies of food for the allied countries overseas. During 1916 the price paid was 82.40 a bushel; during 1917, $221; during 1918, S224J; and this wheat was sold to the United Kingdom government and to those of the allies.
In 1919, when the allied governments ceased to purchase, the government of the day restored for a short time the open market system under the grain exchange, and then, before any crop was marketed in 1919, on July 29, they set up the Canadian wheat board of 1919-20. That board paid an advance of $2.15 a bushel for No. 1 northern, Fort William, and gave at the same time participation certificates. An interim payment of 30 cents was made on those certificates and a final payment of 18 cents, making a total, for that year of $2.63 a bushel. At the end of that season the trade was again thrown back to the open market system, and from 1919 down to 1923 there was a constant agitation for a return to something in the form of a wheat board.
In 1923, the wheat pools were set up as a result of that agitation. In trying to relate that discussion to the present bill I think there are some things that should be kept in mind- things that we must not overlook when we seek to relate those activities and what has taken place since, to what we propose to do to-day. As I said yesterday, I do not think anyone would contradict the statement that

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the difficulty experienced by all those concerned in trying to get down from a very high fixed price, set up first during the war years, and later maintained in the years of the operations of the pools while prices were comparatively high, had a great deal to do with making it impossible for the pools to operate from 1930-31 to the present time.
I believe most people will say that it was about the only thing that made it impossible for the pools to operate.
Again, I think it will be agreed by all those who have made a close study of the situation this year that one of the greatest difficulties experienced in connection with the wheat board as set up first under Mr. McFarland and operated later under Mr. Murray and now- under Mr. Mclvor, in the endeavour to establish that method as a permanent means of marketing our grain, has been the fact that of necessity at the beginning we set up a price closely associated with the world price of the day. That price was 87i cents, and the price throughout that season hovered about that particular level.
I may be asked to-night why it was that 87i cents was set, and I would answer that there are men in this house who have a much closer knowledge of the reason for it than I have. Nevertheless I think I can say, judging from the discussions that took place in the House of Commons prior to the setting up of the 'board, that one of the chief reasons was the desire to see to it that the considerable surplus which had accumulated in the hands of the board during the period of stabilization activities, did not interfere with the marketing of the crop of 1935. The government of that day, after the discussions which took place in the house, concluded that since there was not going to be a compulsory marketing board known as the Canadian grain board, and since there was going to be a voluntary board operating, in the interests of those who were producing a crop in 1935, with a carry-over of 205,000,000 bushels or almost a normal year's crop, they should not suffer in price as a result of the fact that the wheat was being disposed of partly during that year and partly during succeeding years. But whether or not that is the case, the result was that during 1935 a very considerable proportion of the carry-over of the previous years and of the wheat that had accumulated during 1935 was sold on the world markets, to the volume of some 254,000,000 bushels. In selling that wheat the government was compelled to take a little more than four cents a bushel below the price that had been paid to the farmers throughout the year, resulting in a loss to
the board of something over 86200,000. In addition, there was a carrying cost of $5,600,000, making a total of $11,800,000 that was associated with the loss the government took in connection with the 1935 crop.


James Earl Lawson: In respect of that portion which was sold.


James Garfield Gardiner: Yes, of which all but 2,000,000 bushels was sold during that year.
I think it necessary at this point to make reference to some criticisms which were made in the house to-day and yesterday with regard to the expense that the wheat grower of western Canada has been to the Dominion of Canada, compared with the expense that other branches of agriculture have been to the dominion. Down to 1935, or, I might say, down to the present year, the only losses that the government of Canada has taken in connection with the marketing of the wheat crop of western Canada were taken in 1935. Those losses amounted to a total of $11,800,000. During the last ten years the government of Canada has spent $36,800,000 on the live stock industry of this country. That is an average of over $3,000,000 a year spent on the live stock industry, and every dollar of that money has been taken out of the taxes collected by the government of Canada from all the people of Canada. Of that money, $27,500,000 was spent east of Winnipeg and $9,300,000 was spent west of Winnipeg. In other words, the government of Canada, no matter what government was in power, have during the past ten years never lost sight of the fact that the live stock industry, and associated with it the production of dairy products, is one of the most important sections of agriculture in this country. They have recognized their obligation in connection with this section of agriculture by spending continuously throughout these years an average of over $3,000,000 a year. And I may say that the amount which has been spent this year and which will be spent next year under the estimates that have gone through this house will be considerably more than the average which has been spent over the past ten years.
As a matter of fact, if we do what we have been asked to do up to date and what we have made at least partial preparation for doing in the estimates that have gone through or will go through, we shall this year spend in the neighbourhood of a million dollars on one activity alone in connection with the live stock industry of this country, namely, in connection with the eradication of tuberculosis from our herds of cattle from one end of Canada to the other. And the greater part
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of that money will be expended in the neighbourhood of our great cities, to which much of our dairy products are being sent. The real reason for the expenditure of that money is to take care of the health of our people in those areas, and at the same time pay some remuneration to the farmers who have to remove from their herds cattle that are affected with tuberculosis.
I think it is only fair to make that statement in order that when we are discussing the costs that have been placed on the treasury of Canada by the activities associated with the different sections of our agriculture we may have full information. We have always collected, on the wheat that passed through Fort William, fees sufficient to cover all the grading activities, the activities having to do with inspection, with regulating the trade; and I think I can say that it is the only branch of agricultural industry in Canada which has paid its way from the beginning right down to 1935 in connection with all activities of government.
In 1935, the treasury took a loss which approximates one-third of the amount which has been expended on the live stock industry alone as associated with agriculture in this country over the last ten years. We do not yet know the results of our activities during the present year. At the moment it would appear that we may have to take a considerable loss. The Minister of Finance in his budget speech estimated the loss at $25,000,000. As prices at the moment are advancing, that promises to be a reasonable estimate of the losses which may be taken in connection with the wheat that has been accumulated by the wheat board during this year.
In proceeding to discuss the necessity for legislation at this time to deal with the difficulties of the farmers of western Canada, which may result in the expenditure of some money, I think I should recall some of the causes of the difficulties that have been experienced recently in connection with the grain trade. We have been taken to task, both outside this house and inside, once or twice during this session, for having referred from time to time to world conditions which have brought about much of the present difficulty in connection with agriculture in Canada. But I think no one who has made a study of these problems will deny that by far the greater part of the causes of the difficulties we are experiencing in connection with agriculture are a result of world conditions, and more particularly conditions existing on the European continent. And that brings me to this statement, that there is associated with agriculture on the European

continent at present a system of organized government control which prevails only because of the great uncertainties that exist with regard to future political relationships among the countries of Europe, as they are associated with Great Britain herself. When one examines the conditions existing in France, Germany, Italy or Great Britain, which were previously the four best markets for our Canadian wheat, one can understand in large measure the reasons for the difficulty that the wheat grower in Canada is having at the present time. Some people have said that we could exchange wheat with Germany as a matter of barter, and obtain from Germany machines and manufactures and textiles that we require in this country. Without discussing the pros and cons as to whether we should carry on a barter of that kind at this time, I think I am in agreement with all who have made close study of the question when I say that Germany at the present time would not barter with Canada or any other democratic country for any foodstuffs that she can provide within her own boundary lines.
An lion. MEMBER: She would be foolish if she did.


James Garfield Gardiner: Nor would she barter for any foodstuffs that she might otherwise require or that her people might desire to have, if she can provide substitutes for that particular type of food. One of my hon. friends over here says she would be foolish to do otherwise. Well, I should like to call his attention to the fact that for a long time the human race has been looking for some means of making available to those living in different parts of the world products which they themselves cannot produce, at a cost which would permit those products to be consumed. There is only one reason why we have eleven million people living in Canada at the present time as against the few Indians who lived here before the white man came. That is the fact that we trade with other people, that we go to the uttermost ends of the earth to get those things we desire to have in order that we may live in that state of comfort and security that we as human beings desire. My hon. friends who live in Alberta come to eastern Canada and suggest that if they are ever to be able to pay their debts they must be able to sell their coal, and they associate that with the great wheat problem of the west. They come to Ottawa and tell us as a government that we should make it possible to ship the coal of Alberta all the way down to Ontario, and that if this could be done, Alberta would be able to pay its debts.

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An hon. MEMBER :: We did not say that.


James Garfield Gardiner: My hon. friends sitting in the far corner did not say that, but that is what their leader said the last time he was in Ottawa interviewing the government and asking for the payment of subventions to assist in bringing Alberta coal to Ontario.
I make that statement because it gives me an opportunity to reply to some of the arguments that have been advanced against the payment of subventions to those who are producing wheat in the west. For many years we have been paying subventions to assist the shipment of coal from the maritime provinces to Ontario. We have been offering to pay subventions to assist in the shipment of coal from Alberta to Ontario. We have been paying subventions to assist in the shipment of coal from Alberta to the city of Winnipeg. We have paid subventions on coal shipped from my own constituency in Saskatchewan to the city of Winnipeg. We have been paying bonuses to the steel industry in Nova Scotia since long before I was born.


Thomas Alexander Crerar: Not now.


James Garfield Gardiner: We paid those bonuses when that steel industry was operating. We have paid other bounties, other bonuses, to various branches of industry from one end of Canada to the other. I make this statement in order to say this, that as a member from western Canada and as a member of this government I do not want to be associated with those on either side of this house who say that at this time we should be trading our views in connection with tariff matters in Canada for any consideration we may obtain in relation to the wheat industry of the west. I would not associate any request that we make from western Canada for consideration in regard to wheat with the fact that tariffs have been collected throughout the length and breadth of the dominion in order to assist industry in this country. I do not believe we have any claim on that ground. And why do I say that? Because every farmer in Canada, whether operating east or west of the great lakes, has been paying his share of the tax that has been imposed upon the people of Canada by reason of the fact that we have had a protective tariff or a revenue tariff ever since confederation. There are, and always have been, more farmers east of the great lakes than there are west of the great lakes. There is as much and more farm produce and farm wealth produced east of the great lakes than west of the great
lakes. So I repeat that I have never based the request for the payment of assistance to the wheat growers of the west on the ground that tariffs have been collected in order to assist industry in Canada.


John Charles Landeryou: The farmers of Ontario and Quebec have a market among the industrial workers of those provinces, but the farmers of western Canada have no market here.


James Garfield Gardiner: It is true that the farmers of the east have a market in eastern Canada, but the farmers of the east have not produced of the commodities that we in the west produce, sufficient in volume to feed the industrial population of the east.


Agnes Campbell Macphail: They get a better price for what they do produce.


James Garfield Gardiner: They do get a better price. We have a market here as well. It is true that it is not so good to us, because we must pay the freight rate from the west, but in any event that is not the ground upon which I would base any claim we may have for consideration as wheat growers.
You may ask me, Mr. Speaker, on what I would base any such claim. I would base it partly upon the fact that these subventions have been paid to others. But even more than that	I would	base it upon the	fact	thatthis very	year we	are providing in	the	estimates now before this house an amount of $27,000,000, the greater part of which will be spent in the industrial centres of the east and the extreme west for the purpose of maintaining in those areas where industry is established the labour that is necessary in order to	operate	those plants in	times ofprosperity. That is as much as we have ever asked in	any legislation brought	into	this
house. That money is paid out in relief for no other purpose than to maintain the men who were employed in our factories prior to the period of depression, producing commodities which were sold both within and without this country. It is paid to maintain them until such time as these people may be able to produce again and sell to advantage the products of industry. I repeat that if it is a proper thing for the dominion parliament to vote money for that purpose, it is a proper thing for this parliament to provide money to maintain upon the farms of the wheat producing areas of the west those farmers who, in years gone by, produced so much wealth and made it available for the purchase of goods coming from all sections of this country.
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thus maintaining men in employment in industry throughout those years. I maintain that we should do this in order that, if difficult years should return, we may have in the west men who will produce those foodstuffs which will not only enter greatly into our trade but become essential for the preservation of those who may be called upon at some time in the not far distant future to defend this and other parts of the empire.
We in the west have not forgotten the days when we were producing our wheat from fourteen or fifteen million acres of land, and doing it to the advantage of all our farmers. At the same time we were maintaining ourselves in such a position that we could still produce live stock in the volume and of the quality that we had been accustomed to produce. We have not forgotten that this parliament set jp an organization that came into western Canada and asked every public man to take ;he platform and advocate the production of wheat as it had never been produced before. When we said that we had no credit, that we could not buy the machinery with which to break up the land, they said to us, "We will provide the credit." And that credit, Mr. Speaker, represents a large part of the debt that farmers have had difficulty in paying ever since. When we were unable to provide the man power-and at the same time help to fight the battles of the empire and this country-to break that land up by the use of horse power, we were told, "We can supply you with the machines." And the machines were put on our land. The land was broken up; and when that period had passed over many of those lands began to blow about, as every farmer knew they would blow about when he was breaking them up in the first place.
But if the Dominion of Canada were to say to me now that we owe nothing to the people who live in those particular areas into which that propaganda was carried during the war period, then I would say that any appeal we have to make in the future to the people who live in those areas would probably fall upon deaf ears, if we required the same kind of assistance as we required in our period of great trial, not many years ago.


Mr. MacNICOL:: Would the minister state, too, that the government encouraged manufacturing institutions of eastern Canada to double their output in the war period?


James Garfield Gardiner: Yes, the government encouraged eastern plants to do a similar thing, and we have been reminded of that during this session, quite a number of times. One of those plants that got into financial

difficulties, partly as a result of the fact that the government called upon it to perform a national task at that time, has 'been a matter of considerable discussion in this house, ever since, the session opened. So far as I am concerned I think we should remember our relationship not only to the great agricultural industry, but to all industry as associated with that particular period.
As I said a few moments ago, you cannot associate our wheat problem, and the necessity for dealing with it with a tariff as it is associated with industry. I said, Mr. Speaker, that some impossible tasks were being placed upon the government 'by some of those who are associated with some of the provinces of Canada at the present time. In that regard, I recall the fact that we had been asked to provide subventions whereby coal could be brought from Alberta down to the central part of Canada to be sold. I should like to state to the house the reply I gave on that occasion. I said I had bought Alberta coal in the city of Regina, and that for Saunders Creek coal I had usually paid from $11.50 to $12.50 a ton. I stated that at the time I was burning in Ottawa the best Welsh coal, and that I was buying it for $12.50 a ton. I asked Mr. Aberhart how he proposed to bring Alberta coal from the city of Regina down to the city of Ottawa, having in mind the fact that Alberta coal has about two-thirds of the B.T.U's of Welsh coal, if that Alberta coal was costing me as much in Regina as the Welsh coal was costing me in Ottawa. His reply to me was: "That is your problem."
Well, Mr. Speaker, there is a much bigger problem than even that. It is associated with the remark that caused me to enter upon this discussion a few' moments ago. It is associated with the remark: Why should other countries accept of the products of this country in order to help feed their people? There is only one reason why they should do that, and the reason is that we can produce better the product they require; we can produce it cheaper here than they can produce it. The reason why they should be using it is that they can produce other commodities which we require, much cheaper than we can produce them. We ought to be shipping our wheat to Germany; we ought to be shipping our wheat to France; we ought to be shipping our wheat to Italy-


An hon. MEMBER:: Have you tried it?


James Garfield Gardiner: -but the people in those countries are not prepared to take our wheat. They are prepared to set up a price which is three times as great as the price we

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are getting for our wheat in this country.
In Italy, by the expenditure of very great sums of money, they are prepared to make it possible to produce within their own land all the wheat that they are prepared to feed to their people. They are prepared in France to do exactly the same thing. Why? It is not because of anything that is happening in this country, but 'because of a lack of confidence and a lack of understanding in existence among the peoples in the countries of Europe at the present time.
That has always been the reason for world depressions. There never has been a world depression develop for any other reason, and those world depressions will never cease to exist until that fear of war has passed into history. At that time they will cease to exist and we shall have better times. If they cease to exist now we shall have better times.
But that does not relieve this parliament, or the members of parliament, from trying to grapple with the problem which that world situation has created. This government, let me point out, has been grappling with the problem. The problem in western Canada, associated with the fact that we broke up land which should not have been broken up, was first grappled with by Mr. Bennett's government in 1935, when they set up operations under the Prairie Farm Rehabilitation Act. We have enlarged upon those activities as to both the extent of their operation, and the time during which they will operate. We have associated the Prairie Farm Rehabilitation Act with a long-term program in the western part of Canada to reestablish those lands which, in a time of war, were placed under cultivation, and which must be got back to grass.
We are spending about $4,000,000 a year on that undertaking. But that $4,000,000 is not spent upon wheat. It is spent to get the farmers back to operating those lands in a way which will make it possible for homes to be built as a result of their operations. We are trying to get farmers to operate those lands in a way which will bring about conditions whereby the lands will not be blowing round, but where live stock may be raised upon them, and where grain necessary to the feeding of that live stock may be produced.
In addition to that, we have been trying to reestablish those areas in another way. We have entered into arrangements with the provincial governments and with the municipalities in the west, under which a considerable part of the debt which had been incurred as a result of the activities of those years was wiped off. There was brought before the house only a few days ago a piece of legislation through
which it is intended to continue activities in that direction, in the hope that some assistance may be brought to those who incurred unnecessary obligations during the period of our difficulties.
But we did not stop there-neither the previous government nor this one. In 1931. when we had our first great crop failure of this period, the previous government set up a method of dealing with the wheat area in western Canada. I want to say this, that I have no criticism to make of the Conservative party of that day. I have no criticism to make of the Progressive party of that day, or of the United Farmers of Alberta. I have no criticism to make of the Liberal party of that day. May I point out that it was the first experience this country had ever had with the payment of a bonus. They decided to pay that bonus in the months of May and June of 1931.


Robert James Manion: Was it not 1932?


James Garfield Gardiner: No, I believe it was
1931. That bonus was set at five cents a bushel. Everybody now realizes that it was not a wise thing to do in that particular year. Why? Because in the spring of that particular year there was a fine looking crop, as there usually is in the western part of Canada in May and the early part of June. There was a fine looking crop over all the area, but the price was poor. They said that because the price was poor they were going to try to help the farmer by giving him a bonus of five cents a bushel. In the latter part of June and the early part of July every farmer in western Canada knew that in over half of that area there was little if any crop, while in one-third of the area there was no crap at all. I understand that the hon. member for Qu'Appelle (Mr. Perley), along with a representative of the provincial legislature, Mr. Fraser of Oxbow, and Mr. J. J. McGurran, secretary of the municipal association of Saskatchewan, came to Ottawa and interviewed the prime minister of that time. They suggested that an acreage bonus plan should be substituted for the five cent bonus which had been provided by the legislation of that session. However, the government was unable to provide for that plan because the bonus legislation had been provided for during the time the house was in session.
That bonus had to be paid all across the northern part of the three western provinces, and it cost this country thirteen million and some odd thousand dollars. There was an area in the southern part of Saskatchewan, in part of Manitoba and in a small part of
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Alberta where there was no crop upon which a bonus could be drawn. The result was that this parliament voted 810,000,000 to take care of this area which had been dried out and which had no crop. By adopting a policy of paying a bonus in the early part of the season before anyone knew what the crop was going to be, the government of that day was forced to pay not only a bonus of five cents a bushel upon the enormous crop produced in the northern section of the country, but 810,000,000 to those in the southern part of Saskatchewan who had no crop. I think it goes without saying that when this question was up for discussion in 1935, that is the reason why there was not one member of this house who proposed returning to the bonus per bushel method of giving assistance to western Canada in connection with any difficulties as a result of wheat growing. There was not a member of this house who proposed that because the results of the action taken in 1931 and 1932 were fresh in the memory of every member sitting in this house.
I make this statement in order to deal with a reihark which was made this afternoon. The suggestion was made that the legislation passed in 1935 was not intended to deal with an emergency that existed for the time being. However, the records of Hansard will show that it was for that purpose, and that purpose alone. It was to deal with an emergency which existed in the country at that particular time. It was stated most definitely by the Prime Minister of that day that the government of Canada had the power by order in council under that legislation to stop its activities at any time, and that that power could be exercised by the government that would be in power after the election of 1935, whether it were Conservative or Liberal.
When the act of 1935 began to operate, we found by experience that it operated to take delivery of wheat only when the price set was higher than the world price. It operated for one purpose, and one purpose only, to pay a bonus of whatever number of cents formed the margin between the world price and the set price. We had our second experience with it in 1938. We paid a bonus of four cents a bushel to the farmers in 1935 under the legislation. It did not show the same weakness in 1935 as it did in the previous year, nor did it show the same weakness as in 1938. While the 1935 crop was rusted, it was fairly evenly distributed over the whole country and no great inequality resulted. There were no inequalities of any extent in its application. But in 1938 the difficulties

of the bonus of 1931 were accentuated three or fourfold by the fact that the margin between the w'orld price and the set price was about 15 or 20 cents a bushel. The inequalities of the bonus plan brought the government to the conclusion that some change should be made in the method of giving assistance under any legislation that we might introduce in this house.
Some reference has been made to the fact that a delegation from western Canada came to Ottawa in recent weeks in order to ask us to pay the 80 cent price again. I am not going to advocate that the farmers of western Canada should get less than 80 cents a bushel for their wheat, but I am going to state to this house what I stated on a previous occasion, that for the last thirty years the farmer of western Canada has had an average price of 95 cents a bushel for No. 1 northern at his farm. I am not in favour of setting up any system of marketing the crop of western Canada which will obtain for the farmers of the west over the period of the next thirty years a smaller average price for their wheat than has obtained for the last thirty years.


Ernest Edward Perley: I suppose the minister will support my scheme.


James Garfield Gardiner: I am not so sure that my hon. friend's scheme would get the result I desire. It was not his scheme that got the result of which I am speaking, it was a number of other plans.
I should like to make a few remarks with regard to the activities of those who have come here advocating a set price of 80 cents for our wheat. Before that agitation was started, the government had not announced the policy upon which it had been working ever since the report of the Turgeon commission was brought down. This policy had not been announced either to the people of Canada or to this House of Commons, but we had not been idle. We had met boards; we had met delegations of the different farm organizations in western Canada, and we had met those who were associated with other branches of the trade and discussed the problem pro and con in every w'ay that it could be discussed. A conference was held in Winnipeg in December of last year, and I have here the report of its proceedings. As a result of the discussions that took place at that conference there have been certain references made to the cost of producing grain in -western Canada and to other matters associated with wheat. I should like to read a statement made with regard to the present method of handling our wheat. This statement was

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made by no less an authority than Dr. Mackintosh of Queen's university, who is reported on page 88 as follows:
With respect to the wheat board, I very much question if there is any definable attitude in the east towards the wheat board-that is in the east as a whole. There is concern, I would say, at a guaranteed price above the market price as a proposed, if it is to be proposed, permanent policy. Not because the west is getting too much, but because it seems to have no stable foundation under it.
I believe that the few remarks which I have made with regard to it, associated with the inequalities of its distribution, will bear out the contention of Doctor Mackintosh that there is no stable foundation under a policy of that kind.
Then I turn to the statements made by Professor Hope, who has been quoted many times in this house, with regard to the same matter. I quote two sentences only from page 240:
One more word I might say about the present system of bonus this year. This year it may cost the federal government $60,000,000-we do not know-but whatever it is, personally I think it is about the most unfair kind of bonus you can possibly give western agriculture, because it gives a definite bonus to the man with a big crop and nothing to the man with a crop failure.
So there you have two outstanding authorities-one who had been closely associated with one of our western universities before coming east, and the other still closely associated with one of our western universities, giving their opinion with regard to the 18 cent bonus as it was made effective through the 80-cent price during the present year.
Then with regard to Professor Hope's discussions as contained in his paper read to the conference at Winnipeg, from page 146 to page 153, something has been said as to what he figured to be the cost of producing wheat. I would call attention to his statement on page 148 where he says:
The balance of the income is about equally divided between sales of coarse grains and live stock and live stock products.
That is, he says that 85 to 90 per cent of the cash income of the farmers in a certain section of the west, particularly Saskatchewan, comes from producing wheat, and the remainder is about equally divided between coarse grains and live stock. But here is the point which is important:
The long time, 1918-1937, average yield of wheat in these zones has been 11 bushels for the brown soil zone and 11-6 bushels for the dark brown soil zone. The extreme variability of climatic conditions in these two zones is indicated by the brown soil zone average yield of wheat of six bushels from 1929 to 1937, which was only 40 per cent of the average yield
of 15 bushels from 1918 to 1928. In the dark brown soil zone the average yield of wheat was 7-3 bushels from 1929 to 1937, or 48 per cent of the average yield from 1918 to 1928.


William Hayhurst: Does that represent all western Canada?


James Garfield Gardiner: The two areas of which he is there speaking represent the greater part of Saskatchewan.


William Hayhurst: It is stated on page 198 that the dark brown soils gave fifteen bushels from 1930 to 1938.


James Garfield Gardiner: Yes, over a certain period. Then on page 151. Professor Hope was not dealing with the question of the cost of producing wheat. The heading of that section of this paper is this, "Cost of production of wheat in relation to present indebtedness." That is, he is trying to figure out for that conference at what price the farmer would require to be able to sell his wheat in order to pay debts which had been incurred in certain districts in the western part of Canada; and the figures which have been quoted most frequently in this house are the figures contained in the second paragraph on page 151, where he points out this:
On the basis of average yields of wheat of 20 bushels per acre (1918-30) for the Regina plains and Rosetown area-
Those are the best land areas in Saskatchewan.
-the costs of production are approximately 55 cents per bushel for the half section farm, 44 cents for the section farm and 34 cents for a two section power farm with tractor, combine and truck.


Mr. DOUGLAS (Weyburn):: Would the
minister read on?


James Garfield Gardiner: I am going to read it all in a moment, but I want to comment on this. There has been considerable discussion of that point every time that 40 or 50 or 30 cents has been mentioned in connection with the cost of producing wheat at 20 bushels an acre. Someone has said that is on the best land in Saskatchewan-and it is. But I should like to remind my friends from the western part of Canada that even in 1904, when I went to the city of Regina and stood upon the station platform and looked out to the north, the greater part of those lands which now are regarded as the best wheat lands in the western part of Canada were not under cultivation. They were hummocky lands, and you would almost lose yourself in the cracks as you went out across those lands in a dry season. They were heavy gumbo, and the men who first went into western Canada loaded up their wagons and drove out to the lands in
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the neighbourhood of Strasbourg, which to-day are suffering from drought perhaps as seriously as any lands in the western part of Canada. Why did they do that? Because it costs less to grow 20 bushels an acre on light land than it does to grow it on heavy land. Everybody knows that.


Major James William Coldwell: In those days.


James Garfield Gardiner: In any days. Any man who ever worked an acre of land knows it takes more power of every kind-more man power, more horse power, more gasoline, tears to pieces more implements-to work that heavy gumbo land than it does to work light land in any part of western Canada. Any practical man would agree with that.


Mr. MITCHELL:: I do not agree with it.


Ernest Edward Perley: No practical man would
agree with you.


James Garfield Gardiner: If you get 20 bushels to the acre on that light land, that yield is produced just as cheaply, and, I think it will be agreed, even more cheaply, on that land than on the other. So in so far as that part of the argument is concerned, there is very little to it. I have been asked to read on:
This two section power farm is the most efficient wheat producing unit which it is possible to set up.
Hon members will note that, according to this statement, wheat is produced at 34 cents a bushel.
. Probably not more than one per cent of the farms of the west are as efficient as this. On the basis of past studies made in the Regina plains, with due account of debt reductions since, and crop yields and prices, the estimated average debt for these areas will amount to about $26 per acre of crop land or $52 per acre of wheat.
Again, I would call attention to this, that those are the lands which are carrying more debt than any other lands in Saskatchewan or probably any other lands in western Canada.


Charles Edward Johnston: May I ask if that price is on the farm or at Fort William?


James Garfield Gardiner: Well, I have not reached the price at all, yet. I have been dealing with Professor Hope's estimate of the cost.


Charles Edward Johnston: I understood the minister to mention 55 cents.


James Garfield Gardiner: I have been dealing with what Professor Hope says is the cost of producing wheat.


Major James William Coldwell: On the farm.


James Garfield Gardiner: On the farm, yes. That is where costs of producing wheat are-on the farm.


Charles Edward Johnston: It does not include the freight haul.


James Garfield Gardiner: It says, on the basis of past debt studies the debt runs up to $52 per acre of wheat land. Professor Hope goes on -to argue that if you are going to pay off that debt with wheat, at 6 per cent interest the charge amounts to 17 cents a bushel of wheat sold from an average crop of 20 bushels.
The cost plus interest charges per bushel of wheat would amount to an average of 72 cents for the half section farm, 61 cents for the section farm, and 51 cents for the two section farm.
To do what? To pay for the cost of producing the wheat and to pay the costs as well of any debt which has accumulated upon those lands in the years gone by. So far as western members who have lived round Regina are concerned I do not need to go into the reasons for the accumulation of that debt. Anyone who wishes to discover those reasons has only to read what Professor Hope has said.


Thomas Clement (Tommy) Douglas: Will the
minister agree that interest is a legitimate item in the cost of production?


James Garfield Gardiner: I am not stating my own figures; I have given the figures of authorities who have been set the task of figuring what the cost is. I have never calculated the costs myself and I cannot state what the figures are, but I think the authorities should be allowed to speak for themselves. After Professor Hope has pointed out, first, the average yield, and, second, the amount of debt which there is upon the land, and the cost in different types of land, he makes this statement in conclusion:
On the basis of the facts presented, if all the farmers of western Canada were entirely free of debt, or if they did not pay their debts, it would seem that the present farm prices for grain would probably barely maintain a reasonable level of living.
What he says is that if they did not pay their debt, or had no debt, then it is possible that the present level of prices would barely pay their cost of living, and that it certainly would not maintain a reasonable standard of living and enable them to build up their buildings and machinery, their homes and their personal effects up to the level that obtained prior to 1931.


Charles Edward Johnston: Would not
the minister say that was essential?

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James Garfield Gardiner: Yes. It has never been considered essential in any industry that all that kind of thing should be done in times of depression and in times in which industry is suffering because of world conditions, and it has never been done in any industry. Those things are done in the years when there are better prices and better crops than have existed in western agriculture since 1931. Professor Hope acknowledges that, for he says:
Conservatively it would probably require with average yields a farm price for wheat of average grade of about 90 cents, with coarse grains in proportion, to maintain a reasonable level of living and service the present debt on western farms. It would require somewhat more than this to restore the farming community to the condition of 1931.
I ask you, Mr. Speaker, to recall one fact, that for thirty years the western farmer has had an average price of 95 cents; and Professor Hope says that if you can get an average price of 90 cents in future years-


Robert James Manion: At Fort William?


James Garfield Gardiner: He does not say whether at Fort William or not, but he says 90 cents.


Major James William Coldwell: On the farm.


James Garfield Gardiner: He does not say that, and he has not been dealing with that.


Ernest Edward Perley: That is the farm price. The average price at Fort William is over a dollar.


James Garfield Gardiner: The hon. member for Qu'Appelle reminds me that the average price of 95 cents is at the farm. Even if this 90 cents were at the farm it would work out as I have indicated. I make that statement simply because in my opinion it is most essential, in order to have that western area properly financed by the dominion, to reestablish confidence in the minds of the people of Canada that that area can be made to maintain farmers' homes. Even if we have the methods of marketing no better than we have had for the last thirty years, if we have markets as good as we have had in the last thirty years, and crops as good as those that we have had in the last thirty years, then we shall still be able to maintain farming operations in the western part of Canada. And if I were not confident of the truth of this I would not stand on the floor of the house and ask the people of Canada to pay into that area $4,000,000 a year to rehabilitate it, or justify having put into the area last year from $25,000,000 to $50,000,000, as it may work out, in order that we may have time to work out a more permanent policy. Nor would I
be saying to-night that we should now inaugurate a policy based upon sounder principles, under which we will pay in periods of difficulty in the present and in the future in order to bring the farmers through distressing times without the necessity of accumulating more and more debt.
The object of the legislation, the second reading of which I am moving to-night, is this. It is to set up a system under which some assistance can be brought to those in need during periods of difficulty. We have periods of difficulty during which price does not matter at all; those are periods when we have no crop. There have been, during the last ten years, two or three years in all parts of the prairie area, and more years in much of the area, when large sections of the country had no grain to sell, and in those years the farmers required assistance if they were not going to go more deeply into debt than they were before. In this bill there is a section that deals with crop failure periods. It is proposed that we shall pay to all the farmers within crop failure areas the sum of $2.50 an acre on half their cultivated acreage, with a limit of 200 acres upon which they will be paid, or a limit of $500 to be paid to any farmer at a time when he has no crop. In the same section we set a minimum amount to be paid to any farmer. That will be $200. It may be said to me that in the period we have been passing through we have placed certain limitations upon the provinces becoming a responsibility on the federal government. The previous government in 1934 acknowledged federal responsibility for taking care of the drought areas of western Canada, and we have assumed that responsibility since coming into office and have been paying for the costs in those particular areas. We have set up a standard under which those areas are accepted as crop failure areas. We have not previously admitted a province unless they had, at the time of their admission, twenty-five municipalities with a crop of five bushels or under, and we have insisted on provinces going out when the number having five bushels or under had been reduced to ten municipalities or less. Manitoba went out the year before last on that basis, and Alberta last year on the same basis. Saskatchewan still had over forty municipalities last year with five bushels or less, and they have been under the financial care of the federal government during the present year.
This bill sets up 135 townships, not municipalities, as the number that must have five bushels or under before a crop failure area is established, and I would suggest the reason for that. We believe that when the number
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is less than 135 townships or fifteen municipalities, the province should assume some responsibility in connection with the care of those who happen to have crops of under five bushels to the acre in that limited number of townships within the province.
Then the other section of the bill, section 3, provides for a form of assistance which may come in any year when the price is below 80 cents a bushel. That assistance takes the form of an acreage payment, and that payment will be paid on the basis of $1 an acre for areas which have a crop from 9 to 12 bushels inclusive, SI.50 an acre for areas having a crop of 5 to 8 bushels inclusive, and 82 an acre for areas having a crop of from nothing to 4 bushels an acre, on half the cropped acreage. This applies whether the acreage is in wheat or any other crops. In other words, we are not insisting upon farmers growing wheat in order to get assistance when they require that assistance, as we did when we paid the 80 cent price, which involved a bonus of 15 to 20 cents a bushel, or when we paid the bonus in 1931 and 1932. We are saying that farmers can go on and farm in the normal way and have their payments made upon an acreage basis.
I think that is all that is necessary to say in moving the seoond reading of the bill.


Robert James Manion: I shall not talk at any great length
this evening; indeed there is not much more than half an hour left before closing time. Without in any way wishing to criticize the minister, I should like to put it on record that he took nearly two hours in expounding these bills, so that some time when the government is inclined to chide the opposition for holding up business I should like them to recall that.


James Garfield Gardiner: An hour and a half to
be exact.


Robert James Manion: and 155-9 million bushels below the pre-war average, 1909-14. This is the real change in the world situation. Bringing this down to specific countries, France, Germany and Italy account for most of the change.
Over on the next page there is one other paragraph I should like to quote:
While agricultural protectionism was a policy of several European countries for many years in the nineteenth century, there was really no decided tendency toward exclusion till 1925, when Italy and Germany increased their duties on imported wheat.
Then he goes on to give those duties, which I meant to read but will not because I do not wish to go beyond eleven o'clock. That was the period when exports to the importing countries began to contract, and that contraction is what has put Canada into our present difficult position. I was going to quote a speech by Mr. John I. McFarland showing higher imports in one year than the average given here, but I will not take the necessary time. I should like to add a couple of other points merely for my own record. Our carryover on August 1, 1929, amounted to 127,000,000 bushels, and in 1932 we had the lowest price in the history of the world, below 40 cents a bushel.
Having laid that foundation, sir, I want to repeat that to my mind the east and the west are complementary one to the other. If the west prospers, so does the east, because the west buys our goods and we buy a certain amount of theirs, although of course not enough to utilize their whole production. I admit at once as an easterner-although in Fort William we think of ourselves as being in the west-living here at the moment, that tariffs cannot help the wheat grower of the west, although they do help to create and protect markets for the farmers of the east. Wheat, being subject to world competition both as regards price and sale, cannot be protected. I want to go on to say, however, that I believe the price put upon protection by the west is absurd. I have reference to such statements as are contained in a memorandum which was prepared for the maritime provinces by the Minister of Labour (Mr. Rogers) before he became minister, in which he apparently takes the average duties on goods and applies them to all the purchases of the west, adding the resulting figure to the cost to the west of the tariff, and making huge figures of cost of from $50,000,000 to $100,000,000. To me that is absurd. I think in many instances the eastern manufacturer takes no advantage at all of the protection he is given. Some do; some even are guilty of exploitation, if they get the chance. I think that should be stopped where it is found to 
exist, but I know many lines of goods in which the duty makes no difference whatever. I could give many items on which there is a duty of perhaps 25 or 30 per cent but the prices of which are as low in Canada as they are in the United States. In those instances the tariff is protecting the market for the Canadian producer. So I think those from the west who take the attitude that the tariff means to them an increase in cost equal to the average duty on all the goods they buy, are making a statement which I do not believe could be substantiated in any way.
Then I should like to say one thing further, and I do not want to be misinterpreted as being at all critical. I want to point out what so far as I know has not been pointed out, which is that there have been compensations both ways, from west to east and from east to west. There is no doubt that the wealth produced by the grain growers of the west has enriched Canada to a very large extent. I admit that at once; but on the other hand eastern Canada has contributed generously in many different ways to the west. I jotted down some of these ways while listening to the minister. We claim, I think rightly, that we have the lowest freight rates in the world, yet we have a heavy deficit in connection with the operation of our railways. That is an indirect contribution to the west. No other country in the world carries grain over such distances at such low rates. That is one contribution. Another is the coal bonus, to which the minister referred. Another is the construction of the Hudson Bay railway.


Alexander MacGillivray Young: I should like to ask my hon. friend if the coal bonus does not enable the people of the east to obtain coal more cheaply?


Robert James Manion: It enables them to get western coal more cheaply, but not other coal. You could get United States coal much more cheaply if you took off the duty and let it come in free.


Alexander MacGillivray Young: Suppose we followed the policy advocated by the Conservative party and imposed a duty of $5 or $10 a ton and let the central provinces pay that price; what would you think about that?


Robert James Manion: We have not put on a dutj' of $5 or $10 a ton. We have imposed a duty on coal, partly to protect the west. My hon. friend seems to forget that our government did pay out bonuses. I have forgotten how high they went, but I think they amounted to $1.50 or $2 a ton on coal coming from the farthest parts of Alberta to Ontario. I believe that is 'being done even to-day by the present

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government. I think we instituted much of it. That certainly is an assistance to the west, because I happen to know very well how, when I was Minister of Railways and Canals, one could take coal from Cleveland to Fort William, right up the great lakes, for as low as 17 cents a ton, whereas we were bonusing coal from the west to 'bring it to the east for the purpose of assisting the west.


Alexander MacGillivray Young: If the duty were put on high enough, coal could be brought from the west.


Robert James Manion: That is another question.
I will not get off the track on another subject. That brings up a hypothetical question. No government with any common sense at all would put a duty of $5 or S6 a ton on coal.


Alexander MacGillivray Young: It is just about as sane as some of the tariffs we have on now.


Robert James Manion: It may be, but the fact that my hon. friend suggests it, does not make it particularly sane. I am pointing out these facts, not with any idea of criticising. I am merely trying to show the west that the east has done these things, and that it has done them willingly. I have mentioned the bonus on wheat. The Hudson Bay railway cost $53,000,000, and it certainly has not been a success. It was done at the demand of the west. Then there was wheat assistance, which the minister has in his bill, and which we, in our time, carried out to a large extent. Then there was drought assistance, seed wheat, and relief. I merely mention these points.
I repeat that I am not making these observations in any spirit of criticism. I say the east has done all those things with the utmost willingness. There may have been the occasional individual who criticised it, but the vast majority of men, from whatever section of Canada they may come, are perfectly satisfied to help the west, and I think they should be. I repeat that we are one big family. When the west is in difficulty, it is the duty of the east to help the west. I agree with that principle, and I mention those items merely because they are compensations which have gone back to the west, to a certain extent, for the assistance the west has given the people of this great country through the loss it has made on tariffs. Undoubtedly the west has had some loss, but nothing like the losses which are charged at times.
The west, depending upon wheat, must be helped in an emergency such as this. I would point out that when in power from 1930 to 1935 the government of which I was a member recognized that fact. I believe I could
[Mr. Manion.l
illustrate by giving some of the items very briefly. We gave a bonus on wheat to which the minister referred a few moments ago, of five cents a bushel. I thought it was given in 1932, but he said it was 1931. However, it was in our term of office.


James Garfield Gardiner: I am not certain.


Robert James Manion: It was either in 1931 or 1932. It cost something between $12,000,000 and $13,000,000. Then, in the estimates we gave tens of millions of dollars for relief in drought areas and rightly so. Those tens of millions of dollars were given to Manitoba, Alberta, and particularly Saskatchewan. Then we set up a stabilization operation under John I. McFarland. I wish to say here and now what has not been said, and I think should be said, that I believe the west had in John I. McFarland a friend such as few sections of this country have ever had. In John I. McFarland they had a big, broadminded Canadian, who gave his services free, who got no remuneration for them. He did dare to serve the west and, as the results show, he deserves the gratitude of the whole of Canada. The work he did for the west in stabilization operations is estimated, and I think justly so, as having been worth to the western farmer about $100,000,000, and it is pointed out that western farmers had that much more in their pockets than they would have had if the stabilization operations of Mr. McFarland and our government had not been carried out. Those operations were carried out at a profit of more than nine and one-half million dollars.
I wish now to refer to the speeches delivered by the minister not only to-night but on other occasions. They seemed to me to imply on various occasions that there was a loss in the operations of John I. McFarland. If I am misquoting him I should like to have him correct me.


James Garfield Gardiner: I did not say that.
As a matter of fact, I said before that the first loss the federal government had taken on wheat was in 1935.


Robert James Manion: I accept the minister's statement, and I am glad to have him make the correction. I have no desire whatever to misrepresent what he has said. But frankly speaking, when the minister spoke on April 5, he left the impression, at least with me, that he was referring to the stabilization wheat of John I. McFarland. I admit that in 1935 there was a loss. But on the whole operations of Mr. McFarland, according to page 100 of
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James Garfield Gardiner: I have been attempting in every way possible to have everyone who speaks on this question use the term "advance." I do not think it is a price. It has never been set as a price, but is simply an advance paid. I do not think the word "price" should be used.


Robert James Manion: 
Thomas Alexander Crerar: I understand my hon. friend is referring to the amendment to the Canadian Wheat Board Act. Section 3 makes it perfectly clear that the 70 cents is an initial payment.

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Robert James Manion: The minister corrected me and said that he was trying to keep the people from using the word "price." He said he was referring to it as an advance, but I am pointing out that in the explanatory notes of Bill No. 63 the phrase "such fixed price per bushel" is used. The government itself uses that wording, so we cannot be expected to invent some other expression in order to save the government from a mistake it has made.
I was going to refer to another matter. The minister discussed the cost of production. I am not going to discuss this matter at any length because I have not the power or the right to do so. This matter has been dealt with throughout the country at great length, and I have heard it discussed in this house during all the years I have been here. The minister quoted a professor who gave an average cost of production of between 30 and 40 cents for a two-section farm producing 20 bushels to the acre. I submit that there is a danger of causing misunderstanding between the east and the west when such figures are given out. When the eastern business man reads that wheat can be produced for between 30 and 40 cents, he feels the westerner is getting very generous treatment when he receives an advance payment of 70 cents.


James Garfield Gardiner: I think we should clear up this point. The phrase quoted by my hon. friend from the explanatory notes is a quotation from the old bill. In this bill it is initial payment.


Robert James Manion: It does not matter veiy much, but I am reading from the bill which was reprinted with corrections by order of the house passed May 2. 1939. The words in the explanatory notes of this Bill No. 63 are:
(e) to pay to producers delivering wheat at the time of delivery or at any time thereafter as may be agreed upon. . . .


William Daum Euler: Is my hon. friend reading from the explanatory notes?


Robert James Manion: Yes.


William Daum Euler: He will notice that the underlined words are repealed.


Robert James Manion: That is correct. I am glad to be corrected because I have no desire to misinform the house. I was reading it rather hurriedly. In the original bill the words were "initial price," is that not correct?


William Daum Euler: I think the same words as before.


Robert James Manion: It does not really change the argument I was making. I was arguing that to set a figure of 60 cents, or 70 cents
as it is now, is to state to the outside world a price which the outside world will be inclined to accept as the valuation we put upon our wheat. That was my whole argument.


James Garfield Gardiner: That is exactly why we changed the term from "fixed price" to "initial payment."


Robert James Manion: It does not change the fact that you have set the price at 70 cents.


William Daum Euler: How could it be avoided?


Robert James Manion: I want to finish by eleven o'clock because we are closing at that hour. I had a good deal more to say, but I do not intend to say it to-night. I want to suggest that in dealing with different sections of this country we should be tolerant, especially when we are dealing with emergent conditions like this. We should be ready to compromise and we should not forget that we are one family. There were a couple of suggestions I wanted to make, but I am afraid it is too late for me to attempt to do it in two or three minutes.


James Garfield Gardiner: Take an extra five
minutes.


Robert James Manion: I will drop some of it. My first suggestion is that we should work out, not just an emergency plan as this government is attempting to do or as we attempted to do in the first break-out of the emergency, but a long range plan to deal with the west over a period of years. We should attempt to work out a plan which would be just to the west and just to the rest of the country. This plan should not cost too much if at all possible. All reasonable men realize that there is a limit to what the country can continue to pay. We have a huge railway deficit, we have heavy relief costs, we have other costs in connection with wheat, and so on. All these run into huge amounts of money and there is a limit to what we can do in that way. That is, unless our hon. friends the social crediters prove to be right and we are able to turn out a large amount of money. However, I do not agree with their theory. I believe that under the present economic system we cannot go on indefinitely with huge deficits, and I submit that we should attempt to work out a long range plan in consultation with the farmers and farmers' organizations to assist our agriculturists. In arriving at this plan we should keep in view some of the ideas of my hon. friends such as insurance against crop failure and so on.
Prairie Farm Assistance

We are facing a condition to-day which is not temporary. The European countries have been able to build up their own grain production and have increased their ability to get along without our wheat. It is my opinion that it is dangerous to work on the basis of thinking that we are facing an emergency for only this year. I may be wrong, but to my mind it is likely to continue over a long period of years. I wish I could think we could get rid of some of this economic nationalism, this dictatorship mentality, which exists in Europe, but there seems to be no prospect of that from what we read in the daily press. A wheat conference is to be held in London, and later on a world conference may be held. The large exporting countries such as the United States,
Canada, Argentine and Australia should endeavour to work together and not cut each other's throats as has been done on some occasions. At one time Argentina cut the price on the world market. We should work together to try to do something in the way of a long range plan and endeavour to do justice, not only to western Canada but to the country as a whole.


Victor Quelch: I move the adjournment
of the debate.


Robert James Manion: I may go on.
Motion agreed to and debate adjourned.
At 11.02 p.m. the house adjourned, without question put, pursuant to standing order.



END OF VOLUME III