[Stage Direction]
On the order for government notices of motion:
Hon. R. B. HANSON (Leader of the Opposition) :: Mr. Speaker, may I ask the Prime Minister (Mr. Mackenzie King) when the notice of motion to set up a committee to study orders in council passed by virtue of the defence of Canada regulations will be taken up? I have had inquiries from hon. members desiring to speak upon it. I understand the committee is ready to be struck, and I had hoped that the motion might have been considered long ere this.


Right Hon. W. L. MACKENZIE KING (Prime Minister):: I should like to have a word with my hon. friend about the motion. I hope to give him a definite reply to-morrow.



EUROPEAN WAR


[Stage Direction]
On the orders of the day:
William Lyon Mackenzie King: During recent weeks, the world has witnessed lightning war in all its fury and frightfulness. It is difficult to believe it was only twenty-five days ago that Holland and Belgium were invaded. We vividly recall the immediate heroic resistance of those two nations to the terrific onslaught of the Germans. We know how magnificently Britain and France responded to their appeal for aid. We have seen the German forces employing the full might of concentrated warfare, and, with incredible losses to their own man-power and equipment, crush Holland and Belgium and invade a portion of France.
The unexpected rapidity with which nazi Germany wrought her work of destruction was due to the most carefully prepared plans for invasion, to sudden action at an hour of her own choosing, and to the volume and power of her armaments. It was due as well to inability to coordinate in advance adequate plans of defence with the neutral countries, because of the over-scrupulous and excessive care with which they sought to safeguard their neutrality.

Battle of Flanders-Mr. Mackenzie King
We would perhaps do well to keep in mind that in addition to all this the quick success of the invasion was due less to the unforeseen suddenness of the attack itself than to wholly unexpected incidents in meeting the situation.
The all but incredible means whereby the enemy effected a breach in the allied lines was announced to the world by Premier Reynaud, of France, on May 21st. Its consequences were being met by (the most determined resistance when, on May 28, to the consternation of the forces in the field, and equally to the people of Belgium themselves, the king of the Belgians capitulated, and obliged his troops to lay down their arms. The already vulnerable position of the allied armies was thereby rendered even more perilous.
Seldom, if ever, and certainly never in modern times, has a military force been so beset by its enemies. Open to long sustained mass attack from three sides, and from above, with the enemy employing in fiendish fashion the most powerful weapons of modern mechanized warfare, the situation for a day or two appeared more desperate than any with which either Britain or France had, at any time, been faced.
The restoration of the morale of forces thus threatened with annihilation, and the evacuation of the armies thus entrapped and surrounded, has been the outstanding feature of the past week. We now have before us a full account of how these results have been achieved. The story is one of the great epics of history. If there was cause for grave alarm in the rapidity and rapacity with which the nazi forces made the headway they did, there is, in what has been subsequently witnessed of the combined actions of the allied armies, navies and air forces, even greater cause for belief in the ultimate victory of the allied arms. If there is one thing above another which the battle of Flanders has demonstrated, it is that in what the allied powers have displayed of effective cooperation, of initiative and resource, valour and tenacity, in these most critical of all days, we have grounds for believing that, as time goes on, they will be found more than equal to any set of circumstances and conditions that may hereinafter arise.
During the period of time to which I have been referring, it is obvious that for military reasons it was not possible for the government to make any statement with respect to the disposition of Canadian military, naval and air forces brought about as a means of affording more effective cooperation with those of the allied forces overseas. I am now in position to make a statement, which of necessity
85826-31$
must be general in its terms, but which will, I am sure, be welcomed by this house and by our country as evidencing the carefully planned cooperation there has been, at every stage, between the Canadian and allied governments.
First of all a word with regard to the Canadian troops overseas. The Minister of National Defence (Mr. Rogers) has already given to parliament a statement with respect to the use it was intended to make of the Canadian troops in Norway, of their being in readiness for embarkation from Scotland, and of the circumstances which occasioned a change in the original plan. One reason for the change of plans has since become apparent in what has taken place on the continent.
Since the invasion of Holland and Belgium, our Canadian troops on more than one occasion have been at embarkation ports, under orders to join the British expeditionary force and the French armies in their desperate struggle in northern France and Belgium. On the most recent occasion, General McNaugh-ton, accompanied by selected officers of his staff, carried out a personal reconnaissance of the battle area, and on his return rendered a most valuable report to the chief of the imperial general staff and to the war cabinet. That the Canadians were not dispatched was due entirely to the conclusion reached by the chiefs of staff.
As the possibility of the invasion of the United Kingdom itself has become more apparent, Canadian military forces in England are being employed in the way in which it is believed will best serve in the defence of England's shores, or in the reconstitution of a fresh field force in France.
The invasion of Holland, Belgium and France and the possible invasion of the United Kingdom has necessitated other means and methods for cooperation between our own and the British military forces. To mention only one, by way of example: We were asked by the British government if we could arrange to have some of our troops sent to the West Indies area, in order to free for service elsewhere some of the British regular forces stationed in that area. The request was immediately met. A contingent of Canadian troops was sent to the West Indies, convoyed part of the way by the Royal Canadian Navy. This Canadian contingent is now on active service there. Of other dispositions requested and being met, I am not free to speak at present.
The house has already been informed of the assistance given in the present emergency by the Royal Canadian Air Force to the Royal Air Force in Britain, through the dispatch and safe arrival of the advance party of a second army cooperation squadron. In
4S4	COMMONS
Battle oj Flanders-Mr. Mackenzie King
order to speed up the supply of air personnel for active service, arrangements are in hand to dispatch overseas a fighter squadron, equipped with aircraft. A number of pilots recently graduated from Camp Borden, who were intended as instructors for the training plan, are also proceeding overseas.
To help meet the urgent requirement of planes, the government made available to the Royal Air Force part of the equipment which was in use, or on order, for our own air force, or in connection with the British commonwealth air training plan. This equipment included fighter planes now being used for home defence. Further fighters being manufactured in Canada for the Canadian government were diverted to the use of the United Kingdom government, also certain engines immediately available for dispatch overseas, and, as well, some Blenheim bombers which were in England ready to be shipped to Canada, and additional bombers which were on the sea en route to Canada, and which were sent back to the United Kingdom.
As the house is well aware, the filling of orders for aircraft of the types mentioned takes a long time. Some of the orders which are being filled at the present moment were placed a year or more ago. They have served to increase the number available in the United Kingdom in the present emergency. I have in my hand a communication recently received from the secretary of state for dominion affairs in which he makes mention of the fact that a number of aircraft-I shall not specify the particular craft or the number -due for delivery in Canada were en route at the time-I quote:
. . . Our urgent need for all operational aircraft was made known to the Canadian government. We learn that the Canadian authorities have turned around the ship containing these aircraft, and I wish to express the thanks of the United Kingdom government for this very helpful action. May we assume the Canadian government will be prepared also to forego for the time being the delivery. . . .
Of a certain number of aircraft.
Such decision would be gratefully appreciated.
I may say to the house that the government ordered the ship containing the aircraft to be turned back without waiting for a request from the British government, and the communication which I have just read is one expressing the warm appreciation of the British government of that voluntary action on our part.
I come now to the special assistance which the Royal Canadian Navy has been able to give and is giving at the moment, not off the coasts of Canada, but in British waters. As a result of cooperation with the Royal Navy

a rearrangement of forces has been put into effect whereby certain Canadian destroyers are now serving with the Royal Navy in United Kingdom waters. Their place has been taken by certain units of the Royal Navy assigned to service protecting our Atlantic seaboard. This rearrangement will, it is believed, have the advantage of making certain operations more effective. The house will readily understand the reasons why no further particulars can be disclosed at the present time.
I should like to read to the house the message which I sent to the senior officer commanding the Canadian destroyers shortly after they had left our shores:
In this hour when the skill, the strength, and the will-power of the combined allied forces are so greatly needed to cope with the diabolical warfare of a wholly unscrupulous and brutal foe, Canada will be proud indeed when she learns that, as the enemy pursues his endeavours to invade the British isles, destroyers of the Royal Canadian Navy have crossed the Atlantic to be in immediate association with the Royal Navy in the United Kingdom waters.
I send to you and to the men under your command the proud assurance that the government has every confidence that, in your resolute hands, the honour of the Royal Canadian Navy, the traditions which it has inherited, and which it has created, are safe and sure. This confidence will be shared with equal pride by all of Canada once the Canadian people become aware of the presence of Canadian destroyers in British waters.
You will be supported in your noble mission by the continued and utmost cooperation of all branches of the defence forces of Canada and by the single purpose of the Canadian people in this war. Whenever duty may call you, our thoughts and prayers will be with you all.
W. L. Mackenzie King.
In conclusion, may I say that what I have to-day set forth does not represent the extent of commitments which, during the present emergency, Canada has sought to meet in compliance with special requests from the British government. With respect to all three defence services there are other commitments concerning which it is not yet possible to make announcement, but which have been, or are, in process of being carried out.
May I say just a word with regard to the report that the Yimy memorial has been destroyed. I have been in communication with our high commissioner in London and the word I have received from him is that neither the war office nor the air ministry have any information regarding the Vimy memorial. The air ministry are investigating the matter. Up to the present time no word has been received which would confirm the report that the memorial had been destroyed.


Richard Burpee Hanson: Mr. Speaker, I am sure we shall all be encouraged by the narration of events

Battle of Flanders-Mr. Hanson
given by the Prime Minister (Mr. Mackenzie King) this afternoon and the announcement he has made with respect to Canada's participation. He was good enough on one or two occasions recently to inform me personally of what had taken place, and I hope he will continue that practice.
I have very little, perhaps nothing, to add to what the right hon. gentleman has said with respect to Canada's participation. But I should like to read to the house a short extract from the speech which the Right Hon. Mr. Churchill made in London to-day. This is in part what he said:
We shall never surrender and even if, which I do not for a moment believe, this island or even part of it, is subjugated and starving, then our empire across the seas, armed and guarded by the British fleet, will carry on the struggle until, in God's good time, the new world in all its strength and might sets forth to the rescue and liberation of the old.
In my humble opinion those ringing words constitute a challenge to Canada.


William Lyon Mackenzie King: Mr. Speaker,
may I add this word of information which I asked for just before I came into the house. The particular aircraft that were returned in the manner I have described when they were on their way to Canada were ordered by the Department of National Defence in April, 1939. It was not until the last week or two that it has been possible to get that order filled and, as I say, it was turned back to assist the British in the immediate crisis.



BUSINESS OF THE HOUSE

[Stage Direction]
PRECEDENCE OP GOVERNMENT ORDERS-[DOT] OPPORTUNITY TO CONSIDER ALBERTA PROVINCIAL BANK BILL
On the orders of the day:
Mr. J. H. BLACKMORE (Lethbridge):: Mr. Speaker, I desire to direct a question to the Prime Minister (Mr. Mackenzie King). Before asking my question it will be necessary for me to make, with your honour's permission, a brief statement.
An order passed by the house on May 21 provides that government orders shall have precedence at every sitting over all other business except introduction of bills, questions by members and notices of motion for the production of papers. It will be impossible *mder this order to consider private bills after their first reading. I quite understand that government measures dealing with the war must be given right of way during this session, but I trust that parliament is not going to refuse to give consideration to such an important private bill as the proposed act to incorporate the Alberta Provincial bank. The
sponsors of that bill are the ministers of the province of Alberta. May I ask the Prime Minister if he will allow a day for the second reading and committal of that bill?


William Lyon Mackenzie King: Mr. Speaker, there is no desire on the part of the government to do other than to seek to accommodate other governments where that is possible, and certainly it will be a pleasure to me to confer with my hon. friend and see if it is not possible to make some arrangement for the particular measure he has referred to being considered at an appropriate time during the course of the present session.



WHEAT BOARD


[Stage Direction]
On the orders of the day:
Hon. JAMES A. MacKINNON (Minister of Trade and Commerce): Mr. Speaker, yesterday my hon. friend the member for Qu'Appelle (Mr. Perley) referred to an article which appeared in one of the local newspapers to the effect that the Winnipeg grain exchange would remain open until the end of the present crop year, namely, July 31-I think my hon. friend used July 1 as the date, quoting from a newspaper-and also that
50.000.	000 bushels of wheat had been sold by the Canadian wheat board to a buying agency of the British government. He asked whether I was prepared to make a statement on the matter and indicated certain points on which further details were desired.
The statement which I issued to the press on Saturday, and on which this article is based, was as follows:
The Canadian wheat board sold yesterday to the buying agency of the British government
50.000.	000 bushels of wheat at a price considerably above the present market. The government has decided not to close the Winnipeg market at least for the balance of this crop year.
In answering further. I wish to state that the parties to this sale were the Canadian wheat board and the cereals import committee of the United Kingdom. There was no intermediary between the wheat board and the cereals import committee. The sale was made direct. It is considered that it would not be in the public interest to disclose the price.
With respect to the continued operation of the Winnipeg grain exchange, neither the British government nor the cereals import committee has made representations to have the exchange closed.
Canada Evidence Act


[Stage Direction]
On the orders of the day:
Mr. J. H. HARRIS (Danforth):: Mr. Speaker, the press of June 3 recorded the contracts awarded up until April 30, and the total moneys were given. I would ask the Minister of Munitions and Supply (Mr. Howe) when these contracts will be available to members of the house.


Hon. C. D. HOWE (Minister of Munitions and Supply):: Mr. Speaker, it is my understanding that I tabled a list of the contracts let up to the first of April, and those I think have been distributed. It is usual to publish the lists every two months, but if my hon. friend will signify that he wishes the distribution to be made monthly for a time, I shall endeavour to do it. It will mean a great deal of work, but I think we could do it.


Joseph Henry Harris: The information has been given to the press; surely we can have it.


Clarence Decatur Howe: It has been the custom to issue weekly statements to the press and a summary of totals. However, there is some discrepancy between the summary of totals and the actual orders, because the totals refer only to contracts that have been duly authorized, whereas the statement covers orders placed.



CANADA EVIDENCE ACT


[Stage Direction]
Right Hon. ERNEST LAPOINTE (Minister of Justice) moved the second reading of Bill No. 6, to amend the Canada Evidence Act.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Vien in the chair.
On section 1-Not necessary to prove official character.
Mr. LAPOINTE (Quebec East):: This is a very simple bill. It is to make clearer the disposition of an amendment which was made in 193S by chapter 4 of the statutes of that year. Section 2 of that chapter provides:
Where by any statute of Canada or regulation thereunder provision is made for sending by mail any request for information, notice or demand by a department or other branch of the public service, an affidavit of an officer of the department or other branch of the public service sworn before any commissioner or other person authorized to take affidavits setting out that he has charge of the appropriate records, that lie lias a knowledge of the facts in the particular case, that such a request, notice or demand was sent by registered letter ...

Then the certificate of the post office that such letter has been registered is pri-ma facie evidence that the request, notice or demand has been made.
This amendment has been requested more particularly by the statistics branch, which is frequently sending out notices or requests for information. If a prosecution follows because the parties have not acted as the law requires, it involves a great deal of expense to have officers of the department travel about the country to appear as witnesses. This was corrected by the statute of 1938. It was found advisable to add the present amendment, so that the official character of the person who makes the affidavit, let us say the head of the statistics branch, if it is stated in the affidavit that he is the head of the statistics branch, will be sufficient as prima facie evidence. The statute of 1938 would be valueless if it were necessary to bring that officer to prove in person that he was the head of the statistics branch. It is clear that this amendment is merely for the purpose of completing the amendment of 1938.


Richard Burpee Hanson: Of course this amendment carries one step further the departure from the common law principle permitting evidence to be given by affidavit. If it is merely for the purpose of omitting proof of the official character of the person making the affidavit it can do no great harm. On general principles I am rather wary of legislation of this kind, but if it is limited to the specific purpose to which the minister has made reference, I cannot see any great objection to it.


Ernest Lapointe: It is just to avoid costs.


Richard Burpee Hanson: Yes.


Mr. GREEN:: Does it apply only to certain officials, or has it a general application?


Ernest Lapointe: A general application to all the public service of Canada; because it may be that other departments, apart from the statistics branch, will send notices of this kind and have to prove them before a court of law. The amendment is intended not only to avoid travelling by the officers in question in order to appear anywhere in Canada, but to save costs to the person who is prosecuted, because in the long run the accused or the convicted person will have to pay those costs.


Howard Charles Green: What will be the effect on the criminal code ?


Ernest Lapointe: It does
not affect the criminal code at all.

Penitentiary Act


Mr. GRAYTDON:: Does this amendment arise in virtue of some difficulty which has come up in any case before a court?


Ernest Lapointe: Well, we were advised, without having had a judgment on the point, that some doubts had been expressed in the courts.


[Stage Direction]
Section agreed to.
On section 2-Not necessary to prove official character.
Ernest Lapointe: This is the same thing, and it is to amend another section of the same statute applying to banks. I think I had better read the section as it is:
(b) Where a cheque has been drawn on any bank or branch thereof by any person, an affidavit of the manager or accountant of such bank or branch, sworn before any commissioner or other person authorized to take affidavits, setting out that he is such manager or accountant, that he has made a careful examination and search of the books and records for the purpose of ascertaining whether or not such person has an account with the bank or branch, and that he has been unable to find such an account, shall be received as prima facie evidence that such person has no account in such bank or branch.
This amendment was enacted in 1938 at the request of the Canadian Bankers' Association and other people connected with banks, because they had to appear in hundreds of cases of prosecution for no-funds cheques. Under the law the branch manager of a bank on which the cheque had been drawn had to go personally and give his evidence. This amendment is for the purpose of avoiding the necessity of the attendance of the witness, in the same way as in the matter of public documents. Again, if the officer had to come to court to prove his official character this amendment of 1938 would be worthless. The present amendment provides that an affidavit given by the bank manager in which it is stated that he is a banker and the manager of that branch, will be prima facie evidence that he is.


Richard Burpee Hanson: The minister will admit that the two amendments are not in the same category. The first has nothing to do with criminal prosecutions, but this is probably confined to such cases, and the amendment seems to me to be a substantial departure from the common law principle that where evidence is being given the witness should appear and be subject to crossexamination. There might be a mistake in the affidavit and it could not possibly be corrected if the affidavit were to be received on the basis of the amendment of 1938 and the present amendment. Such things might happen and so jeopardize the liberty of the subject. I hope the department gave careful
consideration to this clause before they assented to the principle asked for by the bankers' association. I have seen it happen that these men have had to come forward personally to prove their official position; I think the rule was a good rule and should have been adhered to. However, this only carries the principle one step further.


Ernest Lapointe: Yes.


Richard Burpee Hanson: If there
has been an error it was made in 1938.


Ernest Lapointe: Exactly.


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


[Stage Direction]
Right Hon. ERNEST LAPOINTE (Minister of Justice) moved that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to amend the Penitentiary Act and The Penitentiary Act, 1939, to provide for the removal of convicts from the Yukon and Northwest Territories to gaols or penitentiaries in the provinces, and for the payment by way of compensation to the provinces for the confinement of such convicts therein.
Motion agreed to and the house went into committee, Mr. Yien in the chair.
Ernest Lapointe: Mr. Chairman, this is merely to add the provincial gaols to the penitentiaries. As the law now is, when persons in the Northwest Territories or the Yukon are convicted and sentenced to penitentiaries they go, of course, to the federal penitentiaries. But when the sentence is only a gaol sentence they have to stay there and the lock-ups are congested at times, thus interfering with the healthful employment of persons undergoing imprisonment. This is to authorize the negotiations with the provinces so that convicts under gaol sentences in the Northwest Territories or the Yukon may be sent to a provincial gaol. We will pay the province the expenses connected therewith.


Richard Burpee Hanson: There are no penitentiaries in the Yukon or in the Northwest Territories, but there must be a goal or gaols in one or both.


Ernest Lapointe: These gaols seem to be rather primitive.
Trans-Canada Air Lines

Resolution reported, read the second time and concurred in. Mr. Lapointe (Quebec East) thereupon moved for leave to introduce Bill No. 30, to amend the Penitentiary Act and the Penitentiary Act 1939.
Motion agreed to and bill read the first time.



TRANS-CANADA AIR LINES EXTENSION FOR ONE YEAR OF INITIAL PERIOD DESCRIBED IN ACT

[Stage Direction]
Hon. C. D. HOWE (Minister of Transport) moved the second reading of Bill No. 23, to amend the Trans-Canada Air Lines Act, 1937.
Motion agreed to and the house went into committee, Mr. Vien in the chair.
On section 1-Initial period extended.
Richard Burpee Hanson: Will the minister explain this?


Clarence Decatur Howe: This is a very simple bill. Its sole object, as I explained when I spoke on the resolution, is to make the initial period beyond which rates for the carrying of mail are fixed automatically apply to the calendar year 1940 instead of the calendar year 1939. The reason is that the calendar year was not a typical year. The mail service for revenue commenced only on the first of March of that year whereas the passenger service for revenue commenced on the first of April of that year, so that for two months we operated without a mail revenue and for three months without a passenger revenue.
Hon. members who are familiar with the act will remember that it provides that passenger and express rates shall be competitive with similar services on this continent and that the mail rate shall be based on the cost of carrying mail in the previous calendar year. Were we to take 1939 as a year from which to fix the rate for the carriage of mail for 1940 it would be necessary to increase the rate per mile from its present level of sixty cents to a level of slightly over seventy cents. It is well known to Trans-Canada operators and to the Post Office Department that there is nothing to justify such an increase in rates. We are certain that at the end of 1940, instead of increasing rates we shall be able to lower the rate very materially below the level of sixty cents. We therefore ask that we be allowed to continue the present rate of sixty cents per mile for the carriage of mail and that the automatic feature of the act be allowed to apply after the end of the current calendar year.


Howard Charles Green: What was the deficit in 1939?
I understand that Trans-Canada Air Lines had a deficit last year.


Clarence Decatur Howe: I have not the exact figures before me-it is usually the function of the committee on government-owned enterprises to make that examination-but we budgeted for a deficit of about $470,000, and actually the deficit was about $400,000. We had a slightly better year than the budget figures anticipated. This year we budgeted for an estimated profit of something over $300,000 and we are now running well over $125,000 ahead of our budget, so that it is expected that this year will return a very substantial profit from the operation of Trans-Canada Air Lines. The operating expenses include depreciation on equipment at the rate of 25 per cent, depreciation on all buildings and property at liberal rates, interest on capital invested, and all insurance charges, so that when we predict an operating profit, we mean a profit after all these charges have been paid.


Richard Burpee Hanson: Will the effect of this bill be to extend further subsidies to Trans-Canada Air Lines for the initial period? The initial period is being extended for a year and the effect is to give them more money from the public treasury to carry them over that initial stage. If that is not the effect of the bill, I do not understand it.


Clarence Decatur Howe: No-quite the reverse. The initial period provides that any deficit will be made up from the public purse. Last year, we estimated that the enterprise would be behind to the extent of some $470,000. We appropriated the money at that session of parliament but we did not actually use the whole sum appropriated because the deficit was less than we had expected. This year we are expecting a profit of $300,000, and the operating results are running considerably better than the estimate contemplated. In other words, our passenger service is much better than our estimate provides for. There will be no call on the treasury this year on behalf of Trans-Canada Air Lines, so that we shall have a profit on this year's operation basis, on the sixty cents per mile rate. Actually the position as stated by the leader of the opposition is the reverse of the fact. If we followed the act as it stands we should receive a higher rate for carrying the mail than under present circumstances. The actual cost of carrying mail spread over the entire year last year was slightly over seventy cents, and unless parliament changes the bill the post office would be obliged to pay us that rate for that current year 1940, which instead of giving us an operating profit of the size I have suggested would give us a still larger operating profit. It is simply that 1939 was not a normal year of operation.

Trans-Canada Air Lines


Richard Burpee Hanson: Not a full
year.


Clarence Decatur Howe: Not a full year.


Mr. BROOKS:: Is trans-Canada air mail being picked up by the feeder lines in Charlottetown, Halifax or Saint John, or does the mail have to go to a certain centre, Moncton or Montreal, before being taken up by air mail?


Clarence Decatur Howe: If a letter or parcel bears an air mail stamp it goes to its destination by air mail by the most expeditious route. For example a letter addressed to Charlottetown would go to Moncton by Trans-Canada Air Lines, and by Canadian Airways from Moncton to Charlottetown. Similarly a letter from here to Victoria goes by Trans-Canada to Vancouver and thence by Canadian Airways to Victoria. A letter to Prince Albert would go by Trans-Canada to Regina and by Prairie Airways to Prince Albert.


Alfred Johnson Brooks: Is air mail going west
picked up by planes at Charlottetown, Halifax or Saint John? I can understand that mail going east through Moncton would probably go by air lines to these places, but is mail picked up by air lines in these places to go out to other centres?


Clarence Decatur Howe: Yes. The Post Office Department in each stopping place of any feeder line delivers the mail to the feeder line, which also has a contract with the post office for the carriage of mail, and the feeder line in turn delivers it to Trans-Canada at the nearest junction point.


Mr. ROSS (St. Paul's):: Is that rate sixty cents per hundred pounds per mile?


Clarence Decatur Howe: No, it is a rate based on sixty cents per mile flown. There is some restriction on the total amount of mail carried per average plane

I think it is one ton per plane; but anything up to that is carried at the rate of sixty cents per mile travelled.


Mr. ROWE:: How many planes are in
operation by Trans-Canada now?


Clarence Decatur Howe: Fifteen, all of the same type- Lockheed Zephyrs.


Douglas Gooderham Ross: Is the rate sixty cents per ton per mile, or sixty cents no matter how much goes?


Clarence Decatur Howe: It is sixty cents per mile. The post office is privileged to put on all mail up to a maximum limit which I believe is one ton per plane.


Douglas Gooderham Ross: To what percentage of passenger capacity is Trans-Canada now operating?


Clarence Decatur Howe: The passenger ratio fluctuates in different parts of the system, but the average at the moment I believe is about sixty-five per cent. That means every seat full for sixty-five per cent of the mileage. In the United States it is considered that seventy per cent is the highest ratio that can be expected from planes that take care of short-haul traffic. For example, a plane picking up a passenger at Regina may have travelled from Vancouver to Regina with an empty seat in order to accommodate that passenger. But I believe we established an all-time record in the month of August last when our rate of occupancy ran over eighty-two per cent.


William Earl Rowe: In view of the present emergency has the government given any consideration to the possibility or feasibility of utilizing these planes for military purposes?


Clarence Decatur Howe: The government has considered that very carefully. These planes are of a type that is not useful for military purposes. They have a high landing speed and while the smaller Electras can be used for training purposes, this particular plane has not been approved by the air force for that purpose. But I can say that if there comes a time when fifteen planes are more important for the defence of Canada than for the movement of passengers and mail, they will be diverted immediately to that purpose.


Howard Charles Green: I understand that Trans-Canada Air Lines operate a pilot training school at Winnipeg. Would it not be possible to expand that school and use it for the training of pilots for military service as well?


Clarence Decatur Howe: The training of an air line pilot is very different from the training of a military pilot. Both go through an intensive course; indeed I think if anything the Trans-Canada course is stiffer and longer than the military course. But the military authorities assure me that they could not accept Trans-Canada pilots without considerable additional training in military work, and I can say that Trans-Canada will not accept military pilots without considerable training in the technique of airway operation. So that the school at Winnipeg could scarcely be used for both purposes. Another school is being established nearby for military work, and I think no purpose would be served by trying to combine the two.


Howard Charles Green: \\ hat I had in mind was having the Trans-Canada school expanded to take on the training of war pilots as well as civilian pilots.

Trans-Canada Air Lines


Clarence Decatur Howe: The two courses of training are quite different. There are schools for each purpose at or near Winnipeg, and there seems to be no purpose in trying to combine the two. An instructor in the Trans-Canada Air Lines school would not be qualified to instruct in the military school, and vice versa.


Howard Charles Green: I understand that the basis of the Trans-Canada Air Lines Act, if there is a deficit the post office increases the rate for mail the following year; in other words the postal rates are on a compensatory basis. Last year the question was raised whether the rates for flying air mail in the bush country of the north should be on the same basis. At that time I think the minister explained that the government were looking into the possibility of providing a fair rate for northern air mail rather than continuing the competitive rates which have been in force since the inauguration of air mail in the north. What is the present situation in regard to this northern flying?


Clarence Decatur Howe: This of course is a matter for ,he Post Office Department; it is one in which the Department of Transport is not concerned. There is a bargain between the post office and the operators of those services. In general the rates in the bush country are on a different basis entirely-a basis of so much per pound. For services supplementary to Trans-Canada, which are also a matter of bargain, there is no great discrepancy in the rate. The difference between Trans-Canada and feeder line rates usually represents _ a difference in the cost of operating the equipment. Equipment which is smaller and cheaper to operate is generally used on the feeder services, and the rate reflects that to some extent. As far as northern flying is concerned the rate is the rate fixed by the operators themselves. There is a great difference in rates; I think some pay very well and others are in my opinion too low. Nevertheless they are a matter of contract made under the Post Office Act, and so far no steps have been taken to abrogate those contracts, although in one or two instances examinations have been made.


Howard Charles Green: The suggestion was that a fair rate should be set by the board of transport commissioners. Has anything been done along that line?


Clarence Decatur Howe: Study has been made but
nothing has been done. The whole situation affecting northern flying is in a very unsatisfactory sta/te, owing to the slowing down of exploration and the provision of better surface transportation. There has been a dropping off of traffic in the north, and some radical

step must be taken to adjust the service. We have been trying it out by agreement among the operators themselves. Failing that, however, some further steps must be taken.


Mr. POTTIER:: What was the approximate mileage covered by Trans-Canada trunk lines in the last year?


Clarence Decatur Howe: I have not the report of the Trans-Canada Air Lines with me, but it was tabled a few days ago. From memory I would say that about two million miles had been flown.


Vincent-Joseph Pottier: Have there been any fatal accidents during that time?


Clarence Decatur Howe: No. In that time Trans-
Canada Air Lines has never injured a passenger in any way, nor has it seriously damaged any of its equipment.


Mr. BLACK (Cumberland):: It had been expected that the eastern or Atlantic terminus of the Trans-Canada Air Lines would be at Halifax. I understand however that any further action in that connection has been postponed until the air field at Halifax has been perfected. Meantime a feeder line is operating between Halifax and Moncton. When is it expected that the Trans-Canada Air Lines will use Halifax as an eastern terminus?


Clarence Decatur Howe: As no doubt my hon. friend is aware, at the moment Nova Scotia is a restricted zone for civil flying; with the exception of mail planes, no flying of civil aircraft is permitted in that province. The restriction applies to the use of the Dartmouth airport. It had been fully intended that that airport, which is adequate for all types of planes and for instrument landings, would be used by the Trans-Canada service. The field is not available at the moment, for obvious reasons. A large number of military planes are stationed at that point, and it is not considered wise to permit the ordinary traveller to gain admittance to the field. Therefore the service is using the old municipal airport, which is not capable of development to any higher standard than it has now attained. We believe the type of aircraft flying to that point is the best that could make use of that airport, and we see no possibility of using more adequate facilities until military needs are less pressing than they are at the present time.


Percy Chapman Black: That is, the feeder line plane does not operate out of Dartmouth; it operates out of Halifax city?


Clarence Decatur Howe: That is correct.

Trans-Canada Air Lines


Percy Chapman Black: But it is the
expectation of the minister that the eastern terminus of the Trans-Canada Air Lines will eventually be at Halifax?


Clarence Decatur Howe: We expect to fly Trans-
Canada Air Lines into Halifax at some time. Unfortunately, if I were to go farther than that I might indicate that we might have three or four termini down there. I am sure I would be asked similar questions in respect of Saint John and Charlottetown.


Richard Burpee Hanson: Meantime we are doing very well at Moncton.


Douglas Gooderham Ross: Is the policing
and guarding of airports under the Department of Transport?


Clarence Decatur Howe: The policing of airports,
except in respect of military establishments which would be under the Minister of National Defence, is under the administration of the Minister of Justice.


Douglas Gooderham Ross: I was at Malton
airport a short time ago, and it seemed to me that anyone could walk in or out. I may be wrong, but it did seem to me that there was not sufficient protection around so vital a spot. I imagine the airport at Toronto island is being policed by the city of Toronto, although I am not sure about that. Even there the premises did not appear to be sufficiently guarded. For instance, as one enters the Toronto island airport he is confronted with a sign stating, "No cameras allowed," yet many people inside the gates were carrying cameras. People were coming in by boat, from all sides, and these were the people with the cameras. Certainly the guarding at Malton and Toronto island airports does not satisfy me.


Clarence Decatur Howe: So far as I am aware, the
airport at Toronto island is not used for military purposes, and I doubt if there would be any guards at that point. On the other hand the Malton airport is adequately guarded. My hon. friend, with his open and honest countenance, probably would not be troubled; had he a more suspicious appearance I am sure he would have been made aware of the presence of guards.


Howard Charles Green: Two years ago the minister
took power to invest in a transatlantic company which was to be under the joint operation of Great Britain, Ireland and Canada. What has happened to that plan?


Clarence Decatur Howe: Canada was a junior partner
in that enterprise. It was arranged that after the service had been shown to be satisfactory and had been fully established, Canada would acquire a twenty-four and a half per cent
95826-32J
interest in the enterprise. All the preliminary operations were to be carried out by Imperial Airways, at the expense of the government of the United Kingdom. During the summers of 1938 and 1939 Imperial Airways conducted regular operational flights, and it was the intention to provide suitable equipment and to begin regular operation in 1940. Unfortunately the requirements of warplane construction have made it impossible for Imperial Airways to make available the planes which would be necessary for that route in the current year. Unless some new arrangement is made I presume that the flying of the north Atlantic by Great Britain will not be undertaken until the end of the war.


Howard Charles Green: How much to date have we invested in the plan?


Clarence Decatur Howe: Nothing. Our investment was to have been made after the regular services had been established. So far the service has not been established.


Howard Charles Green: Are there any plans under consideration for a transpacific service?


Clarence Decatur Howe: I think any civil aviation enterprise within the British empire is being held over for the duration of the war. Every plant in the empire capable of turning out suitable craft is engaged in war production.


Richard Burpee Hanson: These
points on which the minister has been good enough to go into detail are new to me because I was not here when some of the service was established. May I ask what is the total investment of Canada in Trans-Canada Air Lines, and the extent of its personnel?


Clarence Decatur Howe: I am sorry my hon. friend did not ask that question yesterday, because at that time I tabled the information he now seeks. My recollection is however that the total investment in Trans-Canada Air Lines is something under $4,000,000. Trans-Canada Air Lines does not own landing fields; it rents them-that is, it pays for landing rights on fields owned either by municipalities or by the federal government. It owns its own planes, hangars and telephone equipment. The radio beam is furnished by the federal government. The personnel stands at about four hundred.


Mr. ADAMSON:: On flight 5 of last Saturday from Ottawa to Toronto the plane, flying on the beam, flew over Malton airport. However it found a considerable amount of fog on both runways and had <to return to Ottawa and remain here during the night. The airport at Toronto was free from fog at the time, but the captain of the aeroplane said
Trans-Canada Air Lines

that he had not permission, to land his ship at the island airport. I think a question of lights was involved, and there may have been certain regulations to be considered. Could the island airport be made a dual airport so that when one airport at Toronto is under fog the other could be used?


Clarence Decatur Howe: The Trans-Canada pilots have conducted most exhaustive tests of the Toronto airport. It would be of tremendous benefit to the passenger traffic in and out of Toronto if that airport could be used. As I understand it, the runways are only 3,000 feet long and they commence and end at water. A pilot would have to be sure he could place his plane fairly close to the end of the runway when landing and brake before reaching the other end; otherwise a plane full of passengers might some day 'be landed in lake Ontario. Our pilots have decided that these runways are not safe for Trans-Canada planes, and we have had to accept their decision.


The CHAIRMAN:: I would direct the attention of the committee to standing order 58. section 2. The remarks I made last night apply to the present debate. In committee hon. members should direct their attention to the subject matter of the particular clause under discussion. I have not wanted to interfere so far, but I believe that much of this discussion has been out of order.


Richard Burpee Hanson: If we do not ask these questions now we will not be able to get the information here. It may be given in the committee on railways and shipping owned and operated by the government, but only a few of us have the privilege of attending the sittings of that committee and taking part in the discussions.


Thomas Vien: There will be ample opportunity to obtain all the necessary information from the minister when the estimates for the civil aviation branch of the Department of Transport are under discussion.


Clarence Decatur Howe: Perhaps special latitude should be allowed in view of the fact that we are in the happy position of being a profit-making organization and do not ask parliament for any supply. I shall be pleased to have the information asked for placed before the committee. I have no desire to curtail discussion.


Thomas Vien: There would be at least
the minister's salary to discuss.


Gordon Graydon: In view of the statement just made by the Minister of Transport, and further in view of the fact that the Minister of Justice is in his seat, may I suggest that

there may be something more to the guarding of Malton airport than has been brought out in this discussion thus far. I should like to ask the Minister of Justice and the Minister of Transport to make sure that the guarding facilities at Malton airport are sufficient for all purposes.


Ernest Lapointe: I shall do it with pleasure.


Douglas Gooderham Ross: The airport is guarded to a certain extent by the corps of commissionaires, but I would feel more confident if this corps had sub-machine guns instead of being armed only with revolvers. This airport covers a considerable area and is a vital spot in our communication system. The Minister of Transport has been good enough to say that I have an open face, but perhaps he is thinking of me with my hat off; I had my hat on when I was up there. I suggest that this matter be gone into a little more thoroughly.


Ernest Lapointe: I have noted the remarks of my hon. friend, and the matter will certainly be investigated.


Mr. ESLING:: In view of the profitable nature of this service will the minister not give some thought to providing an auxiliary service from the interior of British Columbia? I ask him to consider the importance of the tremendous industry located there, an industry which perhaps has a larger foreign mail than any other in Canada. It takes longer to reach an airport from the interior of British Columbia than it does to come from that airport to Toronto or Montreal.


Clarence Decatur Howe: The prosperity of Trans-Canada is a temporary affair indeed. H we have a prosperous year this year, next year we have to reduce the rate to the post office and get back to bare bones again. Each year we try to improve our position in order to come out with some profit. The post office arranges for the services between Trans-Canada stops. If my hon. friend can convince the post office that there is an adequate volume of mail and a necessity for aeroplane service to this point, it may be possible that they will consider providing a feeder service.


William Kemble Esling: Would it be possible to convince the minister that there is a sufficient volume of transportation business? Would that not warrant the providing of an auxiliary service regardless of the mail?


Clarence Decatur Howe: I doubt if a service could be arranged on the basis of passenger traffic alone. While a good many people might be travelling back and forth, I doubt if there

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would be the necessary regularity of travel to fill a plane each day. It has not been the custom to establish feeder lines for other services than that of mail.


Mr. McIVOR:: Before I ask my question, may I say that we have been surprised at the head of the lakes at the speed with which the minister gets things done. I should like to know if the extensive use of our air fields for military purposes will make any difference in the opening up of new feeder lines. I am thinking of the large central air field at the head of the lakes.


Clarence Decatur Howe: The original1 plans of Trans-Canada contemplated a feeder line to the metropolis at the lakehead. While it has not been possible as yet to establish it, it is still under consideration.


Ernest Lapointe: Is that Fort William or Port Arthur?


Clarence Decatur Howe: Unfortunately the airport is at Fort William.


Daniel (Dan) McIvor: They are both one.


Howard Charles Green: What lines are in operation from Canada to the United States, and are there any new lines under contemplation at the moment?


Clarence Decatur Howe: At present Trans-Canada
operates from Vancouver to Seattle. Northwest Airlines operate from Winnipeg to the South. Canadian Colonial Airways operate from Montreal to Neiw York and Boston-Maine Airways operate from Montreal to Boston. Trans-Canada Air Lines has made application for permission to operate a service from Toronto to New York. The hearing has been held in Washington, but no decision has been rendered. The Boston-fMaine Airways have an application pending in Washington for permission to extend their service north from Boston to Moncton, New Brunswick.


Howard Charles Green: Are any extensions in Canada under contemplation?


Clarence Decatur Howe: At present we are organizing a service from Toronto to London and Windsor, Ontario, and something has been done in connection with the service from Wagaming to Fort William.


Mr. MARTIN:: The hon. member for Vancouver South has anticipated me somewhat. Would it be correct to say that with the completion of the airport at Windsor, this service will follow immediately, or are there any other airports t6 be completed on that route?


Clarence Decatur Howe: That is the intention. The radio beam has been installed from Toronto to Windsor, the fields at London and Windsor are now being completed, and it is hoped that the service from Windsor to Toronto will commence about July 1.


Douglas Gooderham Ross: On the service between Toronto and Montreal, Toronto and Ottawa, and perhaps Toronto and Winnipeg, has the minister considered getting planes such as the Douglas plane which takes off and lands at a much lower speed and in a shorter distance? With such a plane the island airport in Toronto would be very useful.


Clarence Decatur Howe: The officials of the company have very carefully examined the equipment situation, and while it is admitted that planes of the Douglas type would be useful for short runs from Toronto eastward, it is felt that the expense and difficulties of having duplicate overhaul plants and duplicate spares for two types of planes would offset any operating advantage that would accrue from having these planes at the eastern end. We could not maintain our present operating schedules in the west with the type of equipment my hon. friend suggests.


[Stage Direction]
Section agreed to.
Section 2 agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
Hon. J. L. ILSLEY (Minister of National Revenue) moved the second reading of Bill No. 27, to amend the Department of National Revenue Act.
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Vien in the chair.
On section 1-Appointment and transfer of certain officers.
Douglas Gooderham Ross: Why are the longterm temporaries, as we call them, in all the other departments not put under the civil service commission? It seems to me to be a great injustice to what are called long-term temporary employees in the other departments that they should not have the advantage which this bill seeks to give to the employees in the Department of National Revenue. I am thoroughly in accord with the principle of the bill, but I do not see why the other departments should not take a similar step to that now being taken by the Department of National Revenue.
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Mr. ILSLEY:: I think that nearly all units in all other departments are being treated as it is proposed by this bill to treat all employees of the customs and excise divisions. All the bill does is to remove what I would call an anomaly in the customs and excise divisions. There we have some officers who were appointed by the governor in council working side by side with many other officers who were appointed by the civil service commission, and inconveniences arise when questions of promotion have to be considered. The civil service commission does not recognize for promotional purposes those officers who were appointed by the governor in council under the Department of National Revenue Act. As I explained the other day, the practice of the appointment of officers in those divisions under the Department of National Revenue Act by the governor in council on recommendation of the minister has fallen into disuse. No such appointments have been made since 1934. I myself have not recommended the appointment of any officers under the powers contained in the Department of National Revenue Act.


Mr. COLD WELL:: The minister is to be congratulated upon having taken this stand. I only wish the attention of other ministers and of the house could be directed to other long-term temporary employees throughout the service. I take advantage of this opportunity to bring the matter to the attention of the house, believing it should be given consideration by hon. members particularly with respect to the staff of the House of Commons, where many stenographers have been engaged for twenty years and are still on the temporary staff.
The minister says that the bill provides that in future all appointments in the Department of National Revenue shall be made by the civil service commission. That is splendid. But how are promotions made in the department?


James Lorimer Ilsley: By the civil service commission. Promotional competitions are held by the commission.


Richard Burpee Hanson: Prior to 192S I understand that these officers were appointed by the civil service commission.
ILSLEY: Yes.


Richard Burpee Hanson: Hon. gentlemen will remember that we had a customs investigation by a committee of this house in 1925 or 1926, and following the report of that committee the government of the day set up a royal commission to investigate certain [Mr. Douglas G. Eoss.l
branches of the public service. The commission, which consisted of Mr. Justice Brown, of Saskatchewan, and two other gentlemen, Mr. W. H. Wright and Mr. Ernest Roy, reported to parliament, and in its report it dealt with this very question of the appointment of customs appraisers, preventive officers, and investigators of values and drawbacks- all, I believe, technical officers. The commission, as I recall it, made some severe criticisms of the manner in which these men had been appointed theretofore. I do not recall specifically what recommendations or strictures, if any, were made by the house committee, but if hon. gentlemen will turn to page 8 of the report of the royal commission, which I shall call the Brown commission, they will find that it stated:
It has been recognized and must be admitted that a proper system of appraisal lies at the very base of the customs administration.
On the basis of that premise the commission made certain recommendations, among which was the following:
Our inquiry has shown that the present system of appointing appraisers or other officers requiring expert or technical knowledge is unsatisfactory.
I pause here to say that the system therein referred to was appointment by the civil service commission. I have not had any opportunity of looking into the proceedings of that royal commission to see whether that statement is well founded or not, but certainly it was a stricture on the then method of appointing these technical officers. The report goes on to say:
We are convinced that where expert and technical knowledge is required, the examination of the applicants for positions should be conducted by those who are specially qualified to act in the premises.
Of course that is a stricture on the civil service commission itself. Maybe it was not justified. Personally I have always been a strong supporter of the civil service commission, and the principle of merit. I am not going to depart from that position to-day. The minister will therefore find that in prin- , ciple I am in agreement with what he has to say. But that is not the whole story. The report continues:
We are of opinion that all appointments to the office of appraiser at the different ports of the dominion should be made by the minister after examination of the applicants by the board of appraisers.
That is, if I appreciate that language, by a board set up in the department itself. The report proceeds:
We quite recognize that this method of appointment would conflict with the system now

Department of National Revenue Act
in vogue under the Civil Service Act; but notwithstanding this we are of opinion that this method should be adopted.
As a result, and I believe as a direct result, of that report, the government of the day in 1928 introduced the legislation which the minister now seeks to repeal. If hon. members are interested and will look at the explanatory note on the page opposite page 1 of this bill, they will find set out in small type the exact provisions of the statute as then enacted as a direct result of the report of this royal commission. Subsection 4, which was added to section 1 of the Department of National Revenue Act by the amending statute of 1928, empowers the minister to nominate for appointment by the civil service commission the following classes:
(a)	Customs appraisers of all classes whether serving at the various ports and places of entry or as dominion appraisers;
(b)	All officers in the customs-excise preventive service.
The minister pointed out that this power is now obsolete because this work has been taken over by the Royal Canadian Mounted Police, and probably is being done as effectively as, if not more effectively than under the old system of customs-excise preventive officers.
(c)	All officers assigned to duty as investigators of values and claims for drawback.
Classes (a) and (b) are certainly technical officers; and the theory on which this statute was based was that these men should be appointed by the minister after an examination by a board in the department that would know exactly what class of men was required, what type of men was needed, and what qualifications applicants possessed for these important offices. A large part of, I shall not say the scandal, but the ineffectiveness of the customs department in the days between 1921 and 1926 was because the men who were in the preventive service were really not carrying on their duties. I do not wish to say that all the customs appraisers or all the investigators of values and claims for drawback were not qualified to carry on their duties, but at all events that was .the considered opinion of the royal commission, and of the government of the day. The minister stated, if I heard him correctly, that since 1934 no appointments have been made under this enabling provision to any of these particular offices and that none at all has been made with respect to the customs-excise preventive service, which has been taken over by the other department.


James Lorimer Ilsley: Pardon me; no one from outside the service has been appointed since 1934. One appointment to our staff was made from within the civil service.


Richard Burpee Hanson: I believe I am aware of that particular case. It was the case of a private secretary, was it not?


James Lorimer Ilsley: Yes.


Richard Burpee Hanson: And the minister himself has stated, I believe, that since he came into the office in 1935 he has not made any nomination or appointment. Now the question to be considered here, I think, is whether the fact that, with the one exception which has been referred to and which, of course, stands upon its own basis, successive ministers from 1934 on have adopted this policy is a good and sufficient reason to overrule the recommendations of a royal commission. In days gone by, the present government has appointed a good many royal commissions, and it has been said that it did so in order to escape responsibility. I do not believe that is the case here. But evidently the government of the day in 1928, having regard to the circumstances which had arisen in the previous year, was impressed with the desirability of making an improvement in the nominations to these offices; and I am just wondering if the reason which the minister gave this afternoon is really the sole reason why these powers should be given up. I am not attributing any motives at all to the minister. He was good enough to disclose, what was new to me, that the civil service commission do not recognize for promotional purposes officers appointed by ministers. Do the civil service commission do that in defiance of the law, or is it their right to do that, or just why should they take that attitude? While they do not appoint these officers, these officers become officials of the department; they are entitled to fair treatment at the hands of the civil service commission; and the failure to recognize them for promotional purposes would seem to me, at first blush at all events, without further explanation, to be a discrimination against these men. Although I am not as familiar with the officials of the minister's department as I was prior to 1935, when I had a great deal of business down there, I understand that some of the best men in that department are men who were appointed under the 1928 act, men whom he would not want to part with to-day. Is the sole reason for this bill the fact that there has arisen-I shall not say friction, which is perhaps too harsh a WOrd-lack of cooperation from the civil service commission with respect to promotion of these particular officers, who cannot, I suppose, be very numerous; or is there another reason why the minister proposes to give up this power?
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I believe in the principle of merit with regard to the civil service, but I can quite understand, because of the great territorial expanse of Canada, the ramifications of the public service, and the fact that there are thousands upon thousands of employees scattered from Sydney, Cape Breton, to Vancouver island and into the Yukon, that the civil service commission cannot function one hundred per cent perfectly. Unless, however, very strong pressure were brought to bear upon me with good and sufficient reasons, I would never restrict the rights of the civil service commission, and if my attention had been called to this in 1928 I should certainly have objected in principle to the recommendations of the royal commission. But this course having been recommended by the royal commission in strong terms and for reasons which evidently seemed good to it, and which must have been convincing to the government of the day, the legislation which the minister is now seeking to repeal was enacted, and now, after the space of twelve years, it has been allowed to fall into decay. Is the fact that there is friction with the civil service commission the sole reason for this bill? Is that the sole, controlling factor in asking for the repeal of the act, or what is the real reason? That is the only reason suggested by the minister for the introduction of the present legislation. I should be glad if he would elaborate that phase of the question.


James Lorimer Ilsley: That is not the sole reason. It would not be an important enough reason because the governor in council can promote in cases where the civil service commission declines, and as a matter of fact some of the appointees under the national revenue act have been promoted by order in council. The leader of the opposition has referred to the royal commission of 1928. It is true that that commission recommended this change in 1928.


Richard Burpee Hanson: And the government acted upon the recommendation of the commission.


James Lorimer Ilsley: Yes. But the officers of the department inform me that there has certainly not been any improvement in the quality of the men who have been appointed by the governor in council over the quality of those who were previously appointed by the civil service commission. I agree with the leader of the opposition that there have been some excellent appointments under the powers contained in the national revenue act, and there have ^ been some excellent appointments by the civil service commission during the same period.


Richard Burpee Hanson: I would assume that.


James Lorimer Ilsley: I should not like to say
that the proportion of excellent appointments under one system is any higher than the proportion under the other. That would involve the forming of an opinion which would not meet with agreement on the part of a number of persons to whom it might be expressed. I am certainly not convinced that the calibre of appointees by the civil service commission is any lower than the calibre of appointees by the governor in council. If the civil service commission discharges its duties efficiently, it is at least as likely to make good appointments as the governor in council on the recommendation of the minister. It is free from certain influences which occasionally operate in appointments by the governor in council on the recommendation of ministers. I am not saying that these influences operated in the Department of National Revenue. Apart from preventive officers, there were between twenty and thirty appointed prior to 1930 and between twenty and thirty appointed subsequently to 1930. Of course, there were a great many more appointed to the preventive service, but that phase of the situation is out of the picture now. The experience of the department, as well as the opinion of the permanent officials of the department, was that there was no reason for making this exception in the customs and excise divisions of the Department of National Revenue.
The leader of the opposition asks me whether the sole motive was to get rid of this difference-friction would perhaps be too strong a word-between the department and the civil service commission over the question of promotions. No. That is a very minor factor in the situation. It is a factor; and as the hon. gentleman will note, it is cleared up by section 2 of the bill, which provides that these appointees are to be recognized by the civil service commission for all purposes from now on. It may be said that we should just pass that section, and that would be the whole act.


Richard Burpee Hanson: That would be the whole act if it were the only point.


James Lorimer Ilsley: Yes. That would be the whole act if it were the only point, because we could bring the civil service commission to time in that way if we wished to do so. But I believe there is no reason, at least no conclusive one, for perpetuating an exception in the customs and excise divisions of the department. The fact that appointees must possess technical qualifications is no reason for taking the matter out of the hands of the

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civil service commission. The commission appoints experts right along in all the departments on the recommendation of qualified boards, and we perpetuate an anomalous exception such as this in one department of government, if it is an admission that the civil service commission is not qualified to appoint experts.
I do not feel very strongly about this matter. There are other branches of government in which the employees are all appointed otherwise than by the civil service commission and which we are leaving alone. We are not changing them, because there is no particular reason for a change; but in this case perhaps I have been influenced to some extent by the opinion of the commissioners of customs and excise, who agree that there is no reason for the perpetuation of this anomaly. I am sure the committee is not over-impressed with the fact that a royal commission has made a particular recommendation. Some royal commissions make good recommendations, and some make many recommendations regardless of whether they are good or not. There is a tendency-perhaps I should not say this-on the part of a royal commission to feel that they must make quite a number of recommendations-


Richard Burpee Hanson: To justify their existence.


James Lorimer Ilsley: -to justify their appointment, and while I would not say that was the case here, the fact is that they found that appraisers in the Department of National Revenue in some of the ports were not particularly expert. What more natural than that they should recommend a change in the system of appointing appraisers, suggesting, " Let us appoint appraisers and investigators of value in a different way." Well, we tried it, and it did not have the result contemplated. The government is in a much better position now; the minister is in a much better position than the royal commission was in 1928 to say whether appraisers, investigators of value and drawback officers should be appointed by the civil service commission, because we have had experience with both systems, whereas they investigated only one system.


Richard Burpee Hanson: I agree with the last statement the minister has made. If the department is properly run, the department and the minister are in a much better position to decide the question than three men brought in from outside, one of them an illustrious judge-two of them I know nothing about. The recommendation of the
commission, however, arose out of the class of men appointed in previous years. I believe that is where the difficulty arose-


James Lorimer Ilsley: Mainly.


Richard Burpee Hanson: -and that has been eliminated. It is the policy of the department, supported by the united opinion of the commissioners of customs and of excise, that we should revert to the old system on principle, and I think they are right. But I am only discharging my duty by giving the committee my information as to why this change was made; it was done on the advice of a royal commission appointed by the government of the day, led as now by the right hon. Prime Minister, and enacted into legislation after the considered judgment of that commission had been obtained. The method has not been found to work out well. If the minister wants to put this bill through, I am not opposing it; I merely want to ascertain the real reason. He assured me that the question of promotion from within the civil service is not the real reason, although it is a factor, but that the principle which was in vogue before is, in his judgment, and in the judgment	of	his	officers,	the correct
principle upon which these appointments should be made.


James Lorimer Ilsley: That is correct.


Paul Joseph James Martin: I would not want anything that I intend	to	say	to be	construed asopposing the endowment of full power to the civil service commission in the appointment of officials in the Department of National Revenue. But	I	should like	to make anobservation about	the	method	used by the
Department of National Revenue in the appointment of collectors. Latterly the practice has been, I believe, to regard the post of collector as one of sufficient importance to justify bringing into a community as collector some person who, prior to that time, had not resided there. I can understand the motives which would prompt this course. But I suggest to the minister that there is a strong argument against this method. I can understand in the case of appraisers, where special technical knowledge is desirable, that possibly there have been times when suitable men were not available in the particular community. But I suggest that the practice of appointing a collector, particularly in the larger ports, from outside the community, one not knowing the port or its traditions, is a great mistake. Every man who joins the customs service, let us say in my own city, where there are two large ports, no matter how humble his capacity, should be able to feel that, with proper application and given the ability, he
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may aspire to the highest post open in that particular port. If that feeling were developed, it would tend to improve the morale.


Mr. HOMUTH:: He can now.


Paul Joseph James Martin: Yes, but the practice
latterly has been, particularly in the larger ports, to appoint as collector someone living in another community.


Richard Burpee Hanson: That is
the exception, is it not?


Paul Joseph James Martin: I am trying to make my
argument as to why I think that should not be the practice. I do not know anything about the ports, other than that this is one of the matters in which I have interested myself during the past five years in my own constituency. Without going into particulars of any local situation-the minister probably has in mind better than anyone else what I have particularly in view-I say that when a man goes into the customs service he should be able to feel that with proper application he may reasonably expect some day to become collector in that community. I am not suggesting that the appointment should be made by the minister; I say that it should be made by the civil service commission, but that the civil service commission should be confined in its choice to individuals living in that particular community.
What I am saying has reference only to the collectors, not to the appraisers, in whose case I understand there are special considerations. The post of collector, I suggest-the minister will know whether or not I am correct-is very largely one of public relations. He is the man who has to meet the public. True, he makes certain decisions, but more often than not the decisions are made by appraisers and technical people. Is it not likely that a man who knows the community, who has come up in the service there, is better qualified to serve and meet the public than a man who, for instance, comes to Windsor- I refer to. Windsor only for purposes of example-say from Nova Scotia? I have no doubt that the intermingling would be desirable, but I do not know that there is beyond this, any particular advantage. I strongly urge the minister, because of a certain situation he has in mind, that the collector should be a local individual where possible, preferably one who has been in the service in the particular community. I understand that when there are some special reasons or disabilities, there may be an exception to what I suggest, but if my point of view were accepted, I think it would do much good.
I suggest to the minister that there are several ports in this province-and I am not

speaking of Windsor particularly, nor am I excluding Windsor-where the morale among the men is bad, very bad; and one of the reasons for this fact is the feeling that those living in the community are looked upon with a measure of suspicion, I am not saying always unnaturally, by Ottawa. There is the feeling that Ottawa does not trust them, that Ottawa has not a high regard for the competence of the collectors or of the men under them. That does not tend to the kind of organization we all want, and I would strongly urge the minister to consider the reasons that I have given, and more particularly the motive, which I am sure he will understand, that prompted me to make these remarks.


James Lorimer Ilsley: I have carefully listened to what my hon. friend has said; I am aware of and appreciate the circumstances in the city of Windsor, and particularly in the port of Windsor, that prompted him to make those remarks. Let me say that in my opinion the sole consideration should be the qualification of the man for the position. It may be that, other things being equal as between two applicants for the position of collector, the local man should have the appointment; I do not know, I am not prepared at the moment to subscribe to that. It is true that in the cities of Toronto, Hamilton, Winnipeg, Vancouver, and I think Niagara Falls, appointments during the past few years have been from the inspection staff at Ottawa.


Richard Burpee Hanson: For the good of the service.


James Lorimer Ilsley: I think everybody admits that all those appointments were good ones. I believe this is admitted even by the persons who at the time were most strongly urging the same considerations that have been urged by my hon. friend here to-day. The greatest care was taken by the civil service commission and by the rating officers to see that men of the veiy highest quality available were chosen for the very difficult position of collector in these important ports. I am inclined to think that my hon. friend has over-stressed the importance of the collector being a public-contact man. There are other qualities which in my opinion are more important in a collector than giving the public a pleasant feeling when they deal with the port. After a few years a minister of national revenue comes to understand pretty well the qualities of his permanent officials in various ports of the country. It is of course important for one who comes in contact with the public to make those who deal with him have a friendly feeling towards the department and the government, but he must also see that his officials discharge their duties.

Department o/ National Revenue Act
I do not know whether I should say it here to-day, but some of the officers at the port of Windsor have not been discharging their duties during the last few years. There is a situation there which will have to be dealt with, and dealt with somewhat firmly. If the civil service commission select from the present personnel there the right type of man, all well and good; I have not the slightest objection; but if he is not in sight there, then somebody with strength of character and executive ability will have to be put in charge of that port.
Mr. HANSON (York-Sunbury); I know it has been thought from time to time that the customs and excise service should be handled somewhat after the manner of the branch banks system in Canada. I think it would be for the good of the service if that principle were applied more freely than it is to-day. I do not know anything about the circumstances which have arisen at the port of Windsor, but the minister evidently knows all about it or he would not have made as important a statement as he did with regard to the personnel at that point.
My own view is that in connection with a great service such as the customs and excise it would be well if the minister and the government of the day would from time to time adapt themselves to the principle followed by the chartered banks. A man who enters as a junior in a chartered bank in Ottawa knows that if he renders good and effective services, he will some day rise to the top, and may even become general manager. But he does not go into the bank with the idea of becoming branch manager at the point at which he makes his entrance. That system works out admirably; it is a good one. The misfits are weeded out in time, and those who are ambitious go out on their own account. In the result the bank service reaches a high point of efficiency.
While I am on my feet I should like to refer to another matter. The minister is wedded to the system of civil service appointments for the customs and excise branch. What does he have to say about the other branch coming under his jurisdiction, namely the income tax branch? As I understand it, none of the appointments to that branch come under the civil service commission. I think I understand the reason why that condition obtained at the very outset, when the new department was set up in 1917 under a responsible commission. I think the personnel of the income tax branch has been good, all the way through. But certainly there has been a number of misfits from time to time in various parts of that branch. I commend
to the minister the extension to the income tax branch of the principle he has enunciated. I do not see any good reason why it should not be extended to a branch which has now been operating for more than twenty years.
A solicitor may be required in the income tax branch. There are very few income tax experts among the solicitors of Canada, and there is no reason in the world why an appointment to such a position in the income tax branch should not be made by the civil service commission.
I know that in making these observations I may give offence to my good friend the commissioner of income tax, with whom my relations over a period of years have been friendly. In my judgment he is a first class officer. He protects the public revenue and in my opinion metes out even-handed justice as between the crown and the taxpayer-at least, that has been my happy experience with him.
But I do not know why patronage for the appointment of officials should be vested in the commissioner of income tax and his advisers, and not in the officials of the customs and excise divisions. I do not think a case can be made out for a continuance of the present system as I have described it in one branch, and for the adherence to the other system in other branches.
I commend these observations to the consideration of the minister, because the present set-up seems inconsistent in principle.


Paul Joseph James Martin: I do not wish to pursue the matter I brought up much farther, except to say that the observations of the minister should be separated; and I say, with great respect to him, that he has not done so. His statement may possibly leave the impression that what I had to say had reference to a particular situation which requires cleaning up, and I may assure him that he will have the full support of the whole community in that objective.
But what I had to say had no reference to any particular person. It may possibly have been thus provoked, in that the matter has been brought to a head; but only in that respect, because there can be no question, I take it, of the character of the present collector at that important port. May I simply say this to the minister? I agree with him that the first consideration should be that of merit, the obtaining of someone who, in the estimation of the commission, can do that job better than anybody else. With that principle I agree. But should the first attempt not be to try to find someone in that particular locality? If that is impossible, then
/
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Department oj National Revenue Act
it might be permissible to proceed to pick men from Vancouver or Halifax and move them, let us say to Hamilton. But surely it is possible in any of our larger communities to find men with sufficient integrity, character and ability to permit them to carry on. If that is so, then the minister will have satisfied the other circumstances which I have mentioned.
I am not going to drop the matter-and this without any criticism of the men who have been appointed latterly at various points throughout the province and the country- that a good number of those men have come from within the department itself. I am not going to suggest any particular instance, but I believe the minister should be made aware of the fact that it is quite possible for a man who has spent most of his life in the service at Ottawa to have a closer approach to the appointing bodies than would some individual working in the service outside, who perhaps has never been in Ottawa.
I make that generalization, not only in the form of a generalization, but because I wish it to apply to a particular circumstance. I hope the minister will regard anything I have said as having been said, not with the idea of taking the matter out of the hands of the civil service commission-because I want it to stay there. I would go as far as the leader of the opposition, when he made certain representations in respect of the income tax branch. But the principle of appointment by the civil service commission is not inconsistent with the principle of selecting, where available material exists, from a particular community.


Thomas Miller Bell: I think this discussion ought to bring an expression of opinion from other quarters of the house. In my view the public service of Canada is a Dominion of Canada service, and I do not think appointments should be confined to the localities of Windsor, Niagara Falls, Toronto or anywhere else. I think any Canadian citizen who has fulfilled the qualifications, who can pass the necessary examinations, who can obtain the confidence of the civil service commission and get the appointment, is entitled to that appointment, no matter where in Canada he may reside.
I think promotions from within the service are sound, but I do not think the government or the minister would be wise in setting up community compacts. We once had a Family Compact. I am quite sure we should endeavour to regard these services as being open to every citizen of Canada who can qualify.

I should like to see all appointments made by the civil service commission and on merit alone. Promotions should also be based on merit alone. I come from a part of Canada where there is no large collection point, and I agree with the attitude taken by the minister. It is only right that a young man entering the service at any point should be able to look forward to promotion to a larger port, provided his qualifications warrant the promotion.


Mr. FOURNIER (Hull):: The object of the amendment is to provide that in future all appointments shall be made by the civil service commission. If these appointments are to be made according to the provisions of the Civil Service Act, then all the sections of the act must apply. Section 21, subsection 3 reads:
Except as to appointments to positions in the headquarters of the several departments and other portions of the civil service at Ottawa, the appointments to any local positions in any province shall, so far as practicable, be made from bona fide residents of such locality.
If this amendment is to be applied according to the Civil Service Act, any appointments made by the minister must be from persons living in the particular locality. The main difficulty is that the Civil Service Act contains no definition of territory or locality.


James Lorimer Ilsley: I did not follow the wording of the section, but I am sure that no difficulty arises from the act. The commission fixes the area from which applications may be received. Sometimes it is a town, sometimes a constituency, sometimes an inspection district, sometimes a province and sometimes the dominion.


Karl Kenneth Homuth: Has the minister given
any consideration to reducing the number of ports in Canada? I happen to be chairman of the tariff and legislative committee of a rather large organization. On several occasions I have had to approach the department and direct attention to the fact that certain importations were being made which seriously affected local industries. Material was being brought in under a certain name and the local customs official knew nothing about it. He could not appraise it properly because he had no knowledge of the material. As long as we have laws, we shall have people who try to violate them if a profit can be gained. Material is being brought into the country through various ports under false entries. In the cases brought to the attention of the department immediate action was taken, the proper duty was collected and a penalty imposed. As long

Department of National Revenue Act
as we have so many ports and out-ports, it will be impossible to staff them with expert employees. No matter how many explanatory letters are written by the department, many of these people will not be able, nor can we expect them to be able to understand to what uses any particular material may be put. Perhaps we should have a different system and reduce the number of ports of entry. In passing, I want to state my opposition to the attitude of the hon. member for Essex East (Mr. Martin). He said he had reference only to the heads in the local ports.


Paul Joseph James Martin: Collectors.


Karl Kenneth Homuth: If the collector is a local man, I am afraid he will be influenced largely in favour of local people when filling vacancies in his staff. I know something of the men and women in the service; I have had a great deal to do with the customs service, and I do not know of any department of government where you will find a finer type of man employed. I do not think we pay enough compliments to the men in the service. Time and time again the hon. member for Temiscouata (Mr. Pouliot) rises up in his place and attacks the civil service. I have had a great deal to do with the people, not only in this service but in the Ontario service, and in practically every case I have found that they are the type of people who feel they have a responsibility to do the best they can for the department, the province or the dominion as the case may be. I think we should frown upon this continual bickering about the civil service. I have always found civil servants to be men and women above reproach, always willing to help regardless of whether one sits with the opposition or on the government side. I think it would be a good idea if we objected more strenuously to some of the statements made by certain hon. members, particularly to the hon. member for Temiscouata.


Alphonse Fournier: I am in favour of the civil service commission and the merit system when applied. I do not know that it is applied in all cases. In this particular instance I understand that up to the present appointments have been made by the department after examination by departmental officials who are supposed to be expert in these matters.


James Lorimer Ilsley: Not since 1934.


Alphonse Fournier: Appointments are made after examination by a board composed of representatives of the department and the civil service commission?


James Lorimer Ilsley: Yes.


Alphonse Fournier: Has the commission men who are expert in these matters? If so, why should officials of the department be called in to sit on the board? If we adopt the principle of sending men from Ottawa to fill positions in various points of the country, we shall be discouraging local people from entering the service, and the service will be harmed. The provisions of section 21, subsection 3, should be applied. Then local employees would be encouraged to study and become expert in their line. That is the whole point. I am not against the amendment, but I do not like to see positions in different parts of the country given to men from Ottawa in preference to local men.


James Lorimer Ilsley: The officers in Ottawa got here through transfer from other cities.


Alphonse Fournier: Some of them.


James Lorimer Ilsley: Perhaps they are not always returned to the same city, but eligibility for transfer works to the benefit of persons in those cities as well as to their prejudice. Unfortunately they think only of the prejudice. I want to make just two observations. First I want to assure the hon. member for Essex East (Mr. Martin) that, in any competition which may be held in the near future, there will be no discrimination against officers at the port of Windsor by reason of the fact that they are at the port of Windsor. I want to say also that in what I said before I did not mean any wholesale condemnation of our force of officers at Windsor.


Paul Joseph James Martin: Thank you.


James Lorimer Ilsley: It would be unjust for me to say anything of the kind because we have a great many very fine officers there.


Paul Joseph James Martin: Would the minister go so far as to say that the officers in Windsor were finer than the officers in any other community in Canada?


James Lorimer Ilsley: I have gone as far as I can about Windsor, I am afraid.
With regard to what the hon. member for Waterloo South (Mr. Homuth) said about the closing of ports, it has been the policy of the department for years to reduce gradually, sometimes rapidly, the number of ports, the reason being that there is not the necessity for so many ports as there was years ago. Now, with hard-surfaced roads, automobiles and so on, it is no hardship for an importer to go some distance in order to enter imported goods. I agree very largely with what the hon. member says about the appraisal
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probably being better if you reduce the number of ports, because it will be more uniform, more standardized.
The setting-up of a check branch at Ottawa has had a beneficial effect upon appraisals. Mistakes in appraisal, mistakes in classification and in valuation, although perhaps not so much in valuation, are caught by the check branch at Ottawa. Between 1935 and 1940 there were about ninety out-ports and postal collecting stations closed, and not more than two or three ports or out-ports at the most were opened. It is not the easiest thing in the world to close a port.


Karl Kenneth Homuth: It is like closing a railway station.


James Lorimer Ilsley: I have seen petitions which called upon members to resign in protest against the closing of a port where there were not more than two hundred entries a year, or less than one a day, and boards of trade, prominent citizens, members and so forth make the strongest representations against any reduction in the number of ports.


Mr. CASSELMAN (Grenville-Dundas):: Some are not very successful.


James Lorimer Ilsley: My hon. friend says, not always successfully. I think I can say that during the three or four years following 1935 the closing of ports kept me in more hot water with members, boards of trade and others than anything else with which I had anything to do. Nevertheless I want to warn the members that I expect to be closing quite a number in the near future.


Richard Burpee Hanson: Before the bill passes, might I ask the minister to express his opinion with respect to the recommendation I made to him to bring the third branch of his department, the income tax branch, under the Civil Service Act? I am not going to labour that matter further.
The minister says that he has closed ninety out-ports.


James Lorimer Ilsley: No.


Richard Burpee Hanson: As a rule I think it is a very proper thing to close out-ports, where it can conveniently be done. I know that all ministers have struggled with that situation, and they have met with all the local resistance that the Canadian National or Canadian Pacific railways meet with in closing a station or in tearing up a branch line of railway-and then some. But there is this to be said in that regard. The public convenience, especially of people living along our coast-line, should be given consideration before an out-port is closed. Conditions of

travel, the accessibility of other ports to which they must go, and the expense to which they are put because of the closing of an out-port, are all factors that must not be lost sight of when one is considering closing a port.
There is one other point. What has the minister done to reduce the personnel at certain ports in this country? I have in mind a customs house

I am not going to tell him publicly where it is but I will tell him privately if he wants the information-which is just overrun with officials who have not enough to do to keep them busy three hours a day.


James Lorimer Ilsley: I should like to know where it is.


Richard Burpee Hanson: (York-Sunbury): In the old days the customs house was a port of refuge for people who wanted jobs in the public service and who probably could not support themselves in active competition with their fellows, but that day I hope has passed and gone. I think the minister will find, if he makes a careful review of the situation at certain ports in Canada, that he is wonderfully overstaffed at some ports. I do not mean the port of Fredericton, because they have had to increase their staff by reason of one factor, namely, the importations of the New Brunswick liquor commission.


James Lorimer Ilsley: They are understaffed, I suppose.


Richard Burpee Hanson: No, I do not say that. I think they have a sufficient number of officers to do the work. If the minister looked into the matter, he might even find that they are overstaffed.


James Lorimer Ilsley: I do not know anything about it.


Richard Burpee Hanson: I do know this, that the volume of revenue at that port has greatly increased, and it is due entirely to the importations for the province of New Brunswick, which now enter at that port, and not through the port of Saint John or elsewhere.
What I have particularly in mind is that this is war time, and we have in Canada, I suppose, 80,000 civil servants. Is that an understatement or an overstatement?


James Lorimer Ilsley: An overstatement. The
number would be about 60,000.


Richard Burpee Hanson: Sixty
thousand to seventy thousand? I think the minister will find it is nearer to eighty thousand than seventy thousand. In a

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country as small as Canada, far-flung as it may be, that is an enormous number of federal civil servants to be living directly on the country; and when to that number are added provincial and municipal public servants, one can realize what a great army of people the taxpayers of this dominion are supporting-people who are just living on the country. They are not to be condemned, of course, because the public service has to be carried on, but I suggest to the minister that this is one place where the government might save in war time. I do not mean that this should be done by wholesale dismissals or even retail dismissals of unnecessary civil servants, because that might create hardship; but when positions become vacant by reason of death or superannuation-and this applies to the inside service just as much as to the outside service-the government should give serious consideration to whether the position actually needs to be filled or not. I believe that we could save an enormous amount of money to the treasury of Canada in this time of war by not filling needless positions.
I have in mind that during the economic war in this country from 1930 to 1935, when we left office in 1935 we left literally thousands of positions unfilled and we saved to this country some millions of dollars-I have forgotten the exact number-by not filling those positions. I commend that policy to the minister and to the government, -that they should see to it that in war time, when people are called upon to make great personal sacrifices and to pay heavy taxation

and I am sure it will be heavier before it is lighter-there is no needless expenditure in filling positions in the civil service, both the inside and the outside, which are not required. I venture to suggest that in a period of five years we could save annually to the treasury of this country at least five millions of dollars.


James Lorimer Ilsley: I wholly agree with the leader of the opposition in what he has said about the importance of cutting down staffs by not filling vacancies, wherever that is possible.


Richard Burpee Hanson: It is the only method.


James Lorimer Ilsley: A great deal of attention has been paid in recent weeks and months to that very problem. If he will give me the name of the port which he thinks is overstaffed, I shall have that port investigated. Let me add that if other hon. members know of any overstaffing of customs houses, I should like to know of them myself. The commissioner of customs is as anxious as I am to see to it that there are not unnecessarily large numbers of men engaged in the customs service.
On the point about the income tax division, theoretically the hon. gentleman is perfectly right; perhaps, too, he is practically right. But in the administration of a department one has to be as practical as possible, and there does not seem to be much practical reason for interfering with the very successful working,
I mean from an efficiency point of view, of the system of appointments to the income tax division. From time to time I have given consideration to the question of bringing in a bill to effect a change such as the hon. gentleman has mentioned, but if I were to be asked whether it would improve the quality of the appointments in that division, I certainly would not be satisfied that it would.


Richard Burpee Hanson: The minister would not assert the reverse?


James Lorimer Ilsley: I would not assert the reverse. I would just say that great care is taken in the selection of personnel for the income tax division, and I believe that from a practical point of view the system of appointments is reasonably satisfactory at the present time.


William Earl Rowe: I suggest that the government might well consider some general plan which would serve all departments as well as the two which have been mentioned. It seems to be an absurd practice that some men and women who have been employed and have given efficient service in various avenues of the civil service for ten, fifteen, or perhaps twenty years, are not yet on the permanent staff. One example, which has been mentioned to-day, will be found in our house staff. Many of the guards of the house have been on duty for from fifteen to twenty years, some perhaps even longer; they have given efficient service, displaying through the years a vigilance which we all admire; perhaps they are passing the time when they might take some other positions; yet they are not in the permanent civil service. I cite their case only by way of suggestion. I believe that both the government of the day and the government which preceded them might have given thought to establishing more uniformity in this connection. If a person has been employed in any department of the civil service for a number of years and has given thoroughly good service, there should be some general rule which would enable him to be assured of appointment to the permanent staff or of retaining his position as a life appointment.


[Stage Direction]
Section agreed to.
Sections 2 and 3 agreed to.
Bill reported, read the third time and passed.
Civil Service Superannuation


[Stage Direction]
Hon. J. L. ILSLEY (Minister of National Revenue) moved the second reading of Bill No. 28, to amend the Civil Service Superannuation Act, 1924.
Motion agreed to; bill read the second time, and the house went into committee thereon, Mr. Vien in the chair.
On section 1-Order in council to have force and effect as from the 11th of August, 1939.
Mr. MacNICOL:: We have not received copies of the bill. How can we discuss the contents without a copy? I wish to protest against taking up a bill without a copy of it being on hand.


Richard Burpee Hanson: May I suggest to the minister that if he would allow this bill to stand for a few hours, or until to-morrow, hon. members would be more competent to discuss it. They have not seen the bill; they have not been able to read it; and I have had some memoranda sent to me about this matter which I should like to look into a little further.


James Lorimer Ilsley: It can stand until to-morrow.


Richard Burpee Hanson: May I ask the minister, before he gives effect to the suggestion, whether this bill arises in any way out of the report of the civil service committee of last year?


James Lorimer Ilsley: No. It is the Civil Service Superannuation Act committee. There were two committees; there was a committee on the Civil Service Act and one on the Civil Service Superannuation Act.


Richard Burpee Hanson: This arises out of the report of the committee on the Civil Service Superannuation Act?


James Lorimer Ilsley: Yes; but it does not incorporate all the recommendations of the committee.


Richard Burpee Hanson: I have
seen that report to-day for the first time, and I understand that it contains twenty-eight different recommendations. Is it possible that the government intends to give effect to only one recommendation out of the whole twenty-eight? Is it intended to let the rest stand? Or what is the position?


James Lorimer Ilsley: The present intention is not to go any further during war time, or at least 
within the near future, with the recommendations of that committee than we went by order in council in August last.


Richard Burpee Hanson: And that
definitely referred to this one subject which is the subject matter of this bill?


James Lorimer Ilsley: Yes. The bill merely ratifies the order in council. It was considered feasible to go to this extent by order in council, but later the opinion was given that we could not even do that without reference to parliament. The order in council is in operation now and we wish to give it validity, but the question whether we are to go back and introduce a long bill here, carrying out between twenty and twenty-five other recommendations, some involving very large expenditures of money, is one which perhaps we cannot be said to have finally decided. There is, however, no present intention of doing that in view of the war.


Richard Burpee Hanson: That is
a matter of government policy and I am not quarrelling with it. Will the minister allow this bill to stand?


James Lorimer Ilsley: Very well.
Section stands.
Progress reported.



UNEMPLOYMENT RELIEF


[Stage Direction]
The house resumed, from Friday, May 31, consideration in committee of the following resolution-Mr. McLarty-Mr. Vien in the chair:
That it is expedient to bring in a measure to provide assistance in the alleviation of unemployment and agricultural distress out of moneys appropriated by parliament, and for such purpose to supplement the measures taken by the provinces towards providing assistance to those in need, establishing unemployed persons in employment and training and fitting suitable persons for productive occupations, and also to provide financial assistance to the provinces by way of loan, advance or guarantees out of unappropriated moneys in the consolidated revenue fund, and for the appointment of necessary officers, clerks and employees.
Richard Burpee Hanson: It might
be well for the minister to make a general explanation, and it could then be decided, by consent I hope, whether there should be a full discussion on the resolution or on the bill in committee of the whole. We should not rush this important matter too fast.


Hon. N. A. McLARTY (Minister of Labour):: There is no inclination whatever

Unemployment Relief-Mr. McLarty
on my part to rush this resolution through. It is altogether in the hands of hon. members whether they wish to debate the matter on the resolution or on the second reading of the bill.


Richard Burpee Hanson: Or on both.


Norman Alexander McLarty: Or on both. I do not know that I can add much to the statement which I made on Friday night. This is of course the resolution on which is predicated [the passing of the act that has been put through annually since 1936. In the previous three years it has been passed, I believe, without amendment. Apart from the amendments necessitated by dates in the bill, there are only three amendments that are included. In the preamble there is a reference to our war endeavour with the idea that our effort under this measure will be directed not only towards relieving unemployment but towards regulating employment so as to increase our war endeavour.
In section 3 of the former act it was provided that the dominion should of its own motion undertake works projects. It was thought, in view of the extensive war expenditures which the dominion is at present making, it might be well if, instead of carrying out these projects under the act, should they become necessary, vital and essential, they could be made under a special estimate which this house could pass upon.
The third amendment deals with the question of loans to the provinces to enable them to carry on their proportion of the expenditure under the act. That amendment merely provides that whereas in the act, as it was reenacted last year, such loans could be made by the Minister of Finance and the government when necessary, it is essential that they should be in the national interest in view of the extensive expenditures we are making.
I do not know that I can add anything to that explanation of the amendments which will be included in the bill when it is introduced. In view of the fact that the report was tabled yesterday, I would prefer to leave a statement as to the general operation of the act during the past year until I have had the advantage of hearing the discussion in committee on the resolution.


John Ritchie MacNicol: The minister should give us some report as to the plans he has in view.


Norman Alexander McLarty: As I explained the other night, I had hoped that possibly we might debate this matter on the second reading. However, I am completely in the hands of hon. members in that regard. I do not suggest it, but I had not intended giving any statement until I had heard the debate in committee on this resolution.


Douglas Gooderham Ross: In January, 1938, a report was presented, by the national employment commission, and practically none of the recommendations of that 1938 report have been carried out by the government. One of the great recommendations submitted by that commission was the establishment of a federal employment commission as opposed to provincial employment commissions. The minister ought to say something about this report. There were various interim reports. There was one in August, 1937, containing some important suggestions, and there was an interim report in September, 1937, in which certain recommendations were made.
We find ourselves in a difficult position to-day in Canada owing to the winding up of this commission, which should have been kept in existence all this time. Here we are faced with a shortage of skilled labour. The Minister of Munitions and Supply (Mr. Howe) told us some little time ago that it would not be long before there would be a great scarcity of skilled labour. What are we doing about skilled labour? Are we taking stock of the labour of the country? Are we seeing to it that some of these people who can be brought back to work are being brought back? Is there going to be any provision in this legislation for the rehabilitation of some of these men? We have a great opportunity at this time to get these men back to work. The minister should give us more information so that we can form some idea of what is proposed under this measure. This legislation requires a great deal of discussion before the bill is introduced, and the minister should be able to get from hon. members through this discussion a quantity of valuable information. I said not long ago that what we should have in Canada to-day is a national registration. When the national employment commission started on its job, it said. Why was this done? That is this registration. There were many reasons. They are set out on page 79 of the report, as follows:
Because the commission found very little accurate detailed information about relief recipients in existence; because any aggressive attack on unemployment to be real and constructive must be based on known facts: and finally because the commission had as one of its statutory functions to advise the government in respect to the expenditure of millions of dollars. . . .
That is why we need a national registration at this time, and that is why this commission should be working at the .present moment.
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That is why we should still be gathering these statistics as to what these people are capable of doing. How can we expect to bring out the full war effort of this country unless we know what men we have available? The information must be obtained.


Norman Alexander McLarty: I take it the hon. member is reading from the report of the national employment commission in relation to the registration of those on welfare. If he is reading that, we have, and have had for two or three years, that registration. He may be referring to a broader registration.


Douglas Gooderham Ross: The minister has the registration made by the national employment commission.


Norman Alexander McLarty: Which is being continued.


Douglas Gooderham Ross: Which is being continued at the present time. He has a registration of unemployed people and what they can do.


Norman Alexander McLarty: We have the registration as recommended by the royal commission.


Douglas Gooderham Ross: He has a registration of the unemployed.


Norman Alexander McLarty: Not the unemployed; those on welfare.


Richard Burpee Hanson: But that is only in relation to relief.


Douglas Gooderham Ross: I was going to say the commission could not get anywhere without a national registration. Their problem at that time was the question of expenditure of money in getting people back to work. Our present problem is just the same-to get these people back to work; and I do not see how we can do it unless we have a full registration all over this country so that we may know *what people are available and what they can do. Moreover, we must have some kind of federal agencies, as opposed to the various local and provincial ones. I know that in Toronto, for instance, the employment agencies run pretty well, but there is need for a federal agency of some kind at such a time as this to coordinate our efforts.
There are in this report many more recommendations which might well be put in force at the present time.


Mr. HANSON (York-Sunbuiy):: I think
we should have from the minister a general survey on the resolution. I hold in my hand volume two of the report of the royal commission on dominion-provincial relations.


Mr. THORSON:: Have you read it?


Richard Burpee Hanson: Part of it. In the very first chapter, beginning at page 15, it deals with the social services. From there

on, it contains sweeping recommendations with respect to this vexed question of unemployment relief. According to the brief summary which the minister gave the other night and again to-day, it is apparently his purpose to introduce the same old bill with little if any substantial modification, and to continue to follow the system which has been so unfavorably commented upon by this royal commission. The government may have very good and substantial reasons for continuing the old system and its procedure, but I suggest that at this point the committee is entitled to hear from the minister a precise statement of why the government are following the old system, and certainly a statement at some stage-and I think now is a good time-of the government's policy with respect to the changes proposed by the commission. I intend to deal with these proposals of the commission during the course of the discussion either now or at a later stage, but I think now is the proper time to have this discussion. I invite the minister to give us a statement as to the government's policy, as to why they are following the old practice, and to give this house and the country a statement of their policy with respect, first, to the sweeping condemnation of the old system by the royal commission, and, second, to the very important recommendations made by the commission with respect to this vexed question. If the minister has not read the report, I should like to direct his attention to volume two, pages 18 to 31.


Norman Alexander McLarty: I assure my hon. friend I have read it.


Richard Burpee Hanson: I assumed the minister had. I invite him to make this statement to the committee after the dinner recess.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.


Richard Burpee Hanson: When the committee took recess, I was inviting the minister as gently as possible to give a review of the operations of this legislation for 1939. I wonder if he would be good enough to do so now.


Norman Alexander McLarty: Mr. Chairman, when the committee rose at six o'clock, I believe the suggestion had been made by the leader of the opposition that we might be well advised to consider the effect of the report of the commission on dominion-provincial relations upon the bill to be based on the resolution now before us. I appreciate most kindly his

Unemployment Relief-Mr. McLarty
observations in referring me to those particular pages in the report of the commission in which they deal with the matters of unemployment and social welfare. Perhaps the best statement I could possibly make to-night would be one based upon his observations as to the bearing of the report upon unemployment and agricultural assistance legislation. I am prepared to do so.
The report of the commission on dominion-provincial relations is a most excellent one. With that statement I believe all hon. members will agree. As a result of representations by various provinces, communities and organizations, we have before us to-day-a day which perhaps is not as fortunate as it might be-the report of the work of that commission. I say this is not as fortunate a time as it might be because of those occurrences which have given us very little time either to sleep or to think.
This report contains excellent recommendations. In so far as it relates to legislation such as that now before us, it recommends, in the first place, that in the matter of unemployment aid the dominion government should assume the responsibility for all financial contributions required in connection with that particular undertaking. In respect of unemployment it recommends, as you know, sir, that those who are unemployable shall be a definite charge on and the wards of the provincial and municipal authorities which may be affected.
I believe I might go more deeply into that phase of the matter. Generally speaking, those who are on unemployment aid represent not more than 90 per cent of those who are employable. I might suggest that the report of the commission on dominion-provincial relations is a matter which might not properly be debated in the committee at this particular time.


John Ritchie MacNicol: It should not be.


Norman Alexander McLarty: I say that definitely to
the leader of the opposition, and for this reason:	There are implications which do not
involve the dominion government alone. My hon. friends opposite know that. Those implications involve provincial governments and municipalities. And if we assume the right to deal with the matter, as apparently the leader of the opposition believes we ought, we are dealing with obligations which are not peculiarly our own but rather are related to the provinces and municipalities throughout Canada.
Is there any question of that? Is there any doubt about that? In addition, when it is suggested on a resolution on which a bill is
to be founded that I should deal with the whole matter involved in the report of the commission on dominion-provincial relations, might I suggest that the words of the Prime Minister (Mr. Mackenzie King) might well be borne in mind.
On one occasion the Prime Minister stated:
As previously indicated the report of the commission will be submitted to parliament and to all provincial governments. After an opportunity for careful study of the report has been afforded it is the purpose of the government to invite all the provinces to take part in a dominion-provincial conference and consider the most effective means of dealing with the problems which occasioned the appointment of this commission.
Then, in Hansard for January 16, 1939, the Prime Minister is reported as follows at page 63:
What would be the effect on the provinces, with the constitution remaining as it is to-day, if that theory were admitted for one moment?
The theory, Mr. Chairman, will be enlarged as the opportunity presents itself. The Prime Minister continues:
What authority has to do with the control of the whole question of employer and employee, of master and servant? What authority has to do with the regulation of hours and conditions of employment in mines? What authority has to do with workshops, with factories? What authority alone has any power with respect to wages and hours of labour? Only the provincial authorities. And as long as the provincial authorities have the control of these matters which are all-important in dealing with the question of employment, they must necessarily have some responsibility for the solution of unemployment. Imagine the situation in certain of our provinces to-morrow if a government were in power here which had come to power on the declaration that it was going to assume all the burden of dealing with unemployment and had assumed that obligation as its own? Imagine what some of our provinces would do with respect to many matters that were causing them trouble or embarrassment.
May I refer again to page 64, where the Prime Minister states:
It has been said repeatedly back and forth throughout this country that the purpose of the commission was to say what is to be done and that we are leaving it to a commission to settle the whole matter. That is not the purpose of the commission at all. The commission has the authority to make recommendations, but this parliament alone can bring about any amendment of the British North America Act, and it will require with respect to some matters the consent of at least some of the provinces, in regard to some, possibly all. If we are to get the act amended it would seem we must bring about some kind of conference between representative men in the provinces and representative men in this parliament. I believe such a conference can be brought about and that it can be both successful and helpful, because I think the experience of the last couple of years has made it plain to
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Unemployment Relief-Mr. McLarty
all citizens of this country that there must be a getting together of representative men from all parts of Canada and, as a result of conferences between them, agreement reached on some very necessary amendments to the British North America Act which will meet with the acceptance of the provinces and the dominion.
That is what is meant in the reference in the speech from the throne to a national conference. It is not a national conference to tell the government what it ought to do or should not do. It is a conference to give this country the fruits of discussion, between representative men, based upon information that is absolutely essential and reliable, and which would enable those interested to work out intelligently the amendments to the British North America Act which sooner or later must be worked out if we are to have a solution of more than one of our present day problems.
The leader of the opposition suggested this afternoon that it might be well if I made a statement to this committee to the effect that because the dominion-provincial commission had brought down its report, certain amendments should be made to the Unemployment and Agricultural Assistance Act. I wonder if my hon. friend realizes exactly what that involves? This house met on May 16. Shortly after that, the report of the dominion-provincial commission was laid upon the table of the house. On the other hand, the report of the commissioner under the Unemployment and Agricultural Assistance Act was laid upon the table of the house only yesterday. Is it fair to suggest that because of recommendations brought in by a commission, which was not a unilateral commission, that the dominion should do certain things on the one hand, and the provinces should do certain other things on the other, that this government should deal with them without their being considered by the provinces?
Let me suggest this. My hon. friend knows that so far as employables are concerned, the recommendation of the national employment commission, to which the hon. member for St. Paul's (Mr. Ross) has referred, was that this should be controlled by the dominion government. But there were other recommendations. It was recommended that unemployables should be the responsibility of the provinces. In other words, this is not a unilateral matter concerning the dominion government only. It is a bilateral or a trilateral duty which affects the provinces and the municipalities as well.
I do not know that I need say much more. I feel that I would be stepping entirely outside the scope of my authority were I to deal with a recommendation of the dominion-provincial commission. I would be committing this government to a policy which is something I have no power to do. I do not wish

to evade my responsibility in any way, but I feel that the recommendations of the dominion-provincial commission should receive wider consideration than can be given in a period of two horn's before any definite move can be made in connection therewith. There may be certain questions with which I might well deal. There may be certain matters of unemployment with which I might deal and thus add to the debate on this matter. I -know that many hon. members will speak upon this resolution, and there is no objection to that so far as I can see. I shall endeavour to the best of my ability to contribute to this debate. I do not think, however, that this is the proper time to add to the measure of debate that will inevitably ensue.


Richard Burpee Hanson: Mr. Chairman, I suppose I should feel properly rebuked after that speech, but I must confess that the remarks of the minister leave me cold. I thought possibly that by drawing his attention to the report of the royal commission, he would take us into his confidence at this time with respect to the recommendations which were made therein. I think the minister has made a fair statement from the point of view of himself and the government as to why that should not be done at this time. With that point of view I am not in disagreement. I quite realize, as must hon. members who have been in this house for any length of time, that the question of jurisdiction is involved.
I recall the debates which took place in this house as long ago as 1924 and 1925 when unemployment in Canada first received consideration at the hands of this House of Commons and parliament. I remember the principle being laid down that unemployment relief was, under the provisions of our constitution, a matter solely for the municipalities involved. I believe that still remains a constitutional principle. But having regard to the magnitude of the question, as it has developed since 1929, we all know that in stem reality this question of unemployment relief is one which, because of the necessities of the situation, cannot be left to the municipalities to solve. When it becomes a matter of considerable magnitude, it devolves upon the provinces because the municipalities are, after all, but the creatures of the provinces. That is, I think, the correct position with respect to the question of unemployment relief, unless and until the whole problem becomes a national problem beyond the financial resources of the provinces and municipalities to deal with. Then, when it has become a national problem, as it has been for the space of ten years, it must be dealt with, in the very nature

Unemployment Relief-Mr. Hanson (Sunbury)
of the case, and by the very force of circumstances, by the federal parliament itself because it has become a national problem. With that I think we are all in agreement.
My references to the report of the royal commission on dominion-provincial relations were simply to call attention at this time to the position which the commission took towards this great problem because of its national character. I have no great objection, since the minister refuses in any way to be drawn, to the matter being left- open for future consideration. I know as well as he does that the provinces have to be consulted, but I had hoped that after ten long years of dealing with this national problem, the government might at this time offer something in the way of a practical solution in dealing with this as a national problem.
What has been the attitude of various governments? I well remember the first bill dealing with unemployment relief which was brought down in the house in the session of 1930. There was not a man in this chamber then, and I doubt if there was a thinking man in Canada, who ever had the idea that this problem would not only be with us for ten long years but grow to the magnitude it has reached. If we had conceived at that time that it would become a problem of national magnitude, we might have-I do not say we would have-dealt with the problem ab initio from a different point of view; but there was not a man among us on either side of the house who had any conception of the extent and character of the problem that was confronting us or that it would be with us for these ten long years.
Having failed in my very humble way to get the minister to give us even a review of last year's operations, I shall not at this time make any extended remarks. I would hope, however, that as the resolution passes through the house and the bill is introduced, the minister will give members of the committee of the whole the widest possible latitude in discussion, and that you, Mr Chairman, in the judicial discretion which you exercise, will be good enough to give hon. members your best consideration and the widest possible latitude in discussing all the various aspects of this problem.
I have had the privilege of reading last year's report and the report which was laid on the table yesterday, and have had an opportunity of giving some little study to the whole problem, and I must say before I take my seat that I am a little disappointed that the government are not attempting to deal with this problem in any new way or to extend in any manner the underlying principles
of the legislation which has been put on the statute books year after year now for ten years. All we are doing is simply bringing down a repetition of the grants in aid to the provinces. We have not a word to say about how the money shall be expended; we have nothing to do with administration, and I am afraid that a great deal of abuse has occurred and a great deal of federal money has been wasted through these grants in air. I well remember hearing the Prime Minister (Mr. Mackenzie King) on more than one occasion say in this house that it was wrong in principle for the taxing authority in one jurisdiction to collect money from the people of this country and hand it over to another jurisdiction to spend, and that I believe was a sound stand to take. Nevertheless that is the very principle which we have followed in large degree since the inception of unemployment relief legislation. The amount of money that has been expended in this way in Canada is huge. I have drawn a few figures from the reports that I have read, and I find that the total dominion disbursements under relief legislation from the commencement of such legislation in 1930 to March 31, 1940, reached the huge sum of $377,946,890.57.


Norman Alexander McLarty: I do not want to interrupt my hon. friend, but it is $965,000,000 up to 1937.


Richard Burpee Hanson: By the
dominion?


Norman Alexander McLarty: By all.


Richard Burpee Hanson: I am taking my figure from appendix "E", recapitulation of dominion disbursements under relief legislation to the end of the fiscal year 19391940, which will be found appended to the commissioner's report, and if I read the figures aright, $377,946,890.57 is exactly the amount of dominion disbursements. The figure my hon. friend has in mind, if he will allow me, is the total disbursements of the dominion, the provinces and the municipalities from 1930 to December 31, 1939, which amount to $937,000,000.


Norman Alexander McLarty: Yes.


Richard Burpee Hanson: I have no doubt that by the end of the fiscal year, March 31, 1940, they have reached the larger figure which the minister mentioned. I point out that these statistics refer solely to expenditures under relief legislation. But in addition there are expenditures of public money under such headings as the National Housing Act, the home improvement plan, which of course is supposed to be more or less self-liquidating and I hope may be fully self-liquidating; the
510	COMMONS
Unemployment Relief-Mr. Hanson (Sunbury)
Prairie Farm Rehabilitation Act; direct public works on behalf of the dominion which were made for alleviation of the unemployment problem, and similar measures. I understand that the expenditures under the Prairie Farm Rehabilitation Act from 1935 to date amount to approximately $9,600,000, and I have no doubt that the total expenditures for relief in all categories cannot be far short of $1,500,000,000. That is a huge, a staggering sum of money for a small country like Canada.


Norman Alexander McLarty: I think it fair to remind my hon. friend that his figure is largely overdrawn.


Richard Burpee Hanson: I will admit at once that I have not been able to build a figure up to that sum. But I recall that we start with nearly a billion dollars, and direct expenditures by dominion, provincial and municipal authorities constitute two-thirds of the total amount. I have not before me, although no doubt the minister has, the total of the money expended by this dominion under the National Housing Act- which may, of course, and we all hope will, come back to the treasury. The home improvement plan, the Prairie Farm Rehabilitation Act, and expenditures by the dominion on public works, having in view relief, must have been very substantial, at least $250,000,000. While I do not know the amount, it has been very large, having regard to all the relief which we have advanced to the railways and other authorities for that purpose, some of which money, of course, should come back.


Norman Alexander McLarty: Perhaps my hon. friend will pardon me if I suggest that, while it may be difficult to determine the amounts advanced under the housing act and the home improvement act, it would be unfortunate to assume that these advances are lost.


Richard Burpee Hanson: I never suggested that they were lost. I said, I think explicitly, that these undertakings were supposed to be self-liquidating-


Norman Alexander McLarty: Quite.


Richard Burpee Hanson: -and that they were undertaken, in a degree at all events, as I apprehend it, to assist.


Norman Alexander McLarty: With no loss.


Richard Burpee Hanson: That, I have no doubt, was the intent and desire of parliament when it passed those acts. We hope that losses will not result, but I believe there will be loss in connection with some of those loans, and the dominion government will have to bear a share of any such loss. 
An interesting item appears in the Labour Gazette of May, 1940, page 411, with respect to the number of persons in receipt of direct relief during the month of March. The figures are startling, having regard to the fact that we have had better crops recently and that the war has absorbed, in a measure at least, some of the employables among the younger men. It is stated that the grand total of all classes of persons on urban and agricultural direct relief across Canada in March, 1940, was 768,500. These figures, as I understand it, were released by the minister himself and are the preliminary results of a registration of all direct relief cases carried out for the department by the provinces and municipalities in the month of March. It is true-and I am glad to see it-that the total for March, 1940, compared with the same month in 1939, shows a decrease of 25 per cent, according to the report in the Labour Gazette-, while in comparison with March, 1938, the dominion figure was down by 26J per cent, and both urban and agricultural relief show decreases as contrasted with the situation a year ago. But the problem is still a large one.
.Mr. McLARTY: Has my hon. friend the figures for March, 1933?


Richard Burpee Hanson: No, I have not, but I know they were very large.


William Earl Rowe: What has that to do with the situation?


Richard Burpee Hanson: 
Norman Alexander McLarty: Mr. Chairman, I have
not the slightest reluctance to give that undertaking: I do not wish now or hereafter to curtail debate upon this measure. If I have not taken the opportunity to give an address as to the general policy and scope of the legislation, I know my hon. friend will be kind enough to assume that the opportunity will come when every hon. member can say all he wishes to say in connection with this particular measure.


Mr. CLARENCE GILLIS (Cape Breton South):: The resolution moved by the Minister of Labour (Mr. McLarty) asks for an appropriation of moneys for the purpose of alleviating unemployment; and as I have the honour to represent in this parliament a constituency that is badly affected by unemployment and potential unemployment, I
would ask the indulgence of the committee for a sufficient time to draw the minister's attention to conditions as they exist in Nova Scotia, particularly in the mining industry. In listening to hon. members for the past several days discussing the unfortunate situation in Europe, there were times when I felt they were describing conditions in some sections of Nova Scotia that I have the difficult task of representing in this parliament.
This being my first time to view the machinery of government at close range, I hope that my present impressions are due to strained world conditions. As a worker, I look on parliament as the place where my problems and the problems of my fellow workers should be solved and not as a place where political advantage is the main interest to the destruction of Canada and the confusion of our people-with the dominant factor uppermost, that power overrides justice. I trust my impressions are wrong.
I am going to be as brief and explicit as possible in what I have to say, because I realize that the members of the government are charged with the responsibility of planning and carrying out the details in the operation of the machinery necessary to the proper prosecution of the war. The only comment I intend to offer at this time on the question of the prosecution of the war is that I should like to draw the hon. minister's attention to the condition of industry, particularly coal and steel, from the worker's point of view.
During the past few weeks I listened with a great deal of interest to the government's planned war effort, and every phase of the necessities for an organized effort was gone into, except, in my opinion, the most important one, which was never mentioned. I refer to the workers in industry, who will, in the final analysis, have to produce the sinews of war, and what is their position to-day? In the mining and steel industry from Ontario to Cape Breton Island in Nova Scotia, there is not a section of the workers but are at war with the operators at the present time, trying to put into operation the laws of the country as laid down by the federal government-the right to organize and bargain collectively with their employers. Coal and steel are two industries that are absolutely necessary to a proper prosecution of the war. In the steel industry the operators take the position that they will not recognize a union regardless of the efforts made by the workers to bring them together through the departments of government, both federal and provincial.
In the mining industry in Nova Scotia where they have established collective bargaining for the past thirty years, the operators, taking

Unemployment Relief-Mr. Gillis
advantage of the war and the War Measures Act, have refused and retarded negotiations for the past eighteen months, and to-day in Nova Scotia there is not a section in the mining industry that is under contract with the operators. This also applies to the steel industry of Nova Scotia. 1 see in this situation, with all the planning of government to speed up industry, work twenty-four hours a day and so forth, the possibility of the workers in these industries being placed in a false position, because I think the time is coming, regardless of the war, when they are going to demand from the operators the treatment to which they are entitled, namely, the right to exercise their citizenship. I think it is the prerogative of the Department of Labour, because that department is, in my opinion, a department of labour, to function one hundred per cent for the purpose of ironing out the problems of labour as they arise.
I am calling this to the minister's attention, because I think one phase of our war effort that is absolutely necessary at the present time is that labour should be given the right to organize and bargain collectively and that employers should be forced to sign contracts setting out wages and conditions, and in this way the worker's mind will be set to rest. He can go to work, budget on what income he has, and pay the necessary attention to cooperating with the government in prosecuting the war. On the other hand, if he is not treated as a human being and accorded full citizenship rights, the only thing for him to do is to fight back, and we do not want to be forced in the present situation into a position in which we may have to wage an industrial war in order to establish industrial democracy in Canada. I trust that the Department of Labour will immediately take into consideration the enforcement of that legislation which gives the right to organize and bargain collectively and to strengthen that legislation by compelling operators to sign collective agreements, because where there are no collective agreements, there is not collective bargaining.
I should like, for the benefit of the Department of Labour, to give over briefly the set-up as it exists in Nova Scotia, particularly in the mining industry.
I would draw the attention of the hon. Minister of Labour to a war that is being waged in Nova Scotia, between the operators of the mining industry and the people who are the owners, but who were dispossessed of their birthright by act of government, when the coal leases were placed in private hands to be exploited for profit. There are approximately 10,000 miners in Nova Scotia all employed, in my opinion, by the one company, 
the Dominion Iron, Steel and Coal Company linked up by a merger approved in the nineteen-twenties. The Acadia Coal Company, the Dominion Coal Company and the Cumberland railway were tied into what was then known as the British Empire Steel Company. This later was changed to Dominion Iron, Steel and Coal Company. That merger, on paper at least, has been broken and the Scotia and Acadia companies went through the process of liquidation. But the Dominion Iron, Steel and Coal Company still directs them. This corporation alone employs approximately one-quarter of Nova Scotia's working population. The coal company also operates a railway from Glace Bay to Louisburg. That road comes under the Maritimes Freight Rates Act and receives all the concessions enjoyed by the Canadian National Railways. It also operates a machine shop at Glace Bay. The men employed are paid by the coal company. There are two departments of this shop that perform railroad work only. The wages paid to the men engaged on this work are nineteen cents an hour below the railway rates paid by the other railways including the Sydney and Louisburg railway.
The federal government subsidizes this railway to a considerable extent, and in qualifying under the Maritime Freight Rates Act the railway, I understand, is supposed to maintain a first-class carrier service. The function this road performs at the present time, and has performed for a considerable time, is to transport the company's coal back and forth between Glace Bay and the piers in Louisburg, and it maintains practically no carrier service. In that area there are approximately 60,000 people who are without any decent train facilities whatever. In the past twelve years the federal government has subsidized this short road to carry on the work of the Dominion Iron, Steel and Coal Company, to the extent of $2,608,000, and at the 6ame time the workers employed in the auxiliary shops doing railway work one hundred per cent are paid very much lower than the regular railway rates. That is a matter which should be checked up.
My conception of the subsidy is that it is paid for the purpose of maintaining the railway, keeping the rolling stock in repair and assisting in paying the wages of the employees, and so far as I can see, that company is not carrying out that part of the arrangement. There has been considerable friction in connection with that end of the company's operations. A conciliation board has been applied for by the men to whom I have referred particularly, but so far it has not materialized. We hope that something

Unemployment Relief-Mr. Gillis
will come out of it when it does function. These two departments of the railway employees have made application through the United Mine Workers of America for a board of conciliation to determine their status, but to date no reply has been received from the Department of Labour as to whether such a board would be granted or not.
The coal situation is briefly this: In Nova Scotia in the past ten years several mines have been closed, affecting about 1,000 men. The solution has been to transfer the men displaced to operating collieries which were already overcrowded. As shown by a recent statement by Doctor F. H. Sexton, president of the Nova Scotia technical college, there were 15,000 unemployed youth in Nova Scotia who never had a job. In transferring these men they only aggravated the conditions in the other collieries, the result being that a large number of men reported for work and then returned home again. At present we have the assurance that there are two more mines scheduled to close-one at Reserve being partly closed now, with the other in the Glace Bay area being gradually closed. The closing of these two mines will affect some 1,500 men and their families. The coal company has been promising the opening of a new mine, but to date this has not happened.
That was the situation until I left for Ottawa. They are working slack time on account of the fact that a large number of the boats used to transport coal to the Quebec market were transferred to carrying war material overseas, necessitating the moving of coal to Montreal by rail, and this, being a very slow process, results in the curtailment of operations in the mines. The miners of Nova Scotia feel that they have been robbed of their birthright because coal being a natural resource belongs to the people, and when it is placed in private hands the tendency is to take the cream and leave the skim milk to the people. This is exemplified in Inverness county, where, in our opinion, the coal field was worked as long as it could be profitably, and when profits could no longer be made, it was left to the people, who for the past number of years have been eking out an existence on a relief basis with the local government carrying on the operation. The miners feel that the federal government has an equity in the Nova Scotia coal industry and that the time has arrived when an investigation should be made, because slowly but surely the province is becoming a place of ghost towns and demoralized people.
In addition we have about forty thousand fishermen in the maritimes who are in an even worse position than the miners, their average 95826-33
income being between $200 and $300 a year. These people are not asking for relief or charity but are demanding that the responsible authorities see that the industries are so organized and planned that the workers have an opportunity to live as decent, respectable citizens. The miners appreciate the assistance given the industry by way of subventions, but we feel that the government should make sure that this assistance is used for the purpose for which it was intended, namely, to assist in providing a better standard of living for the people who produce.
The people of Nova Scotia are making a wonderful effort to solve their own economic problems by cooperative, efforts. They have already established 180 credit unions, 43 stores, 17 lobster factories, 7 fish plants, 8 community industries and some 10 other cooperatives. The total number of cooperative organizations in the maritimes is 422. The volume of business done by them runs into the millions of dollars. Other cooperative organizations are hospitalization schemes and housing groups. I should like to make this clear, that the efforts of the people themselves to solve their own economic problems give proof positive that they are not looking for relief or charity, but they are in that position, and kept there, by a system which obliges them to accept relief. I have just described the cooperative set-up whereby the workers themselves are working out their own problems in trying to take over the services of the organizations that have been exploiting them for generations, but they are in this position that, regardless of how well organized that movement is or how successful it is in taking over retail and wholesale business, by reason of the fact that the British Empire Steel Corporation controls the pay envelope of a great majority of the people engaged in that endeavour, the movement is in jeopardy because the company, controlling that envelope, makes the position such that if there is a shut-down of a month or two, these undertakings are crippled, the purchasing power of the people who operate these movements is taken away, and the movement can be wiped out of existence. The people who are working along cooperative lines in Nova Scotia believe that it should be the obligation of the federal government to see that they are given a chance to develop that movement.
I have heard many statements and have read editorials in the press, characterizing this Cooperative Commonwealth Federation group as Sunday school socialists, camouflaged communists, and everything of that kind, and saying that they largely draw on their imagination for many of the statements they make with respect to the problems of the people

Unemployment Relief-Mr. Gillis
they represent. In order that I may not be charged with making statements without good authority, I should like to read something for the information of the minister. I draw this to his attention because he is the Minister of Labour, and I represent in this parliament chiefly labour. I look upon the Department of Labour as the department of government to which I should appeal for redress of many of the problems to find the solution of which I have been sent here. This is a telegram I received from the machine shop workers organization in Glace Bay. There was a fire there which threw approximately 200 men out of employment. That occurred since I came here. The telegram, which is from the president of the Mechanics Local, United Mine Workers of America, reads:
Entire machine shop in ruins, disastrous fire swept large building Sunday, apnroximately two hundred men thrown out of work, we are waiting decisions of locals re levy to relieve distress twenty men at work others idle.
Gordon Livingston, President Mechanics Local United Mine Workers.
The mechanics local of the mine workers did not appeal first to the government for relief; they appealed to the members of their own organization. It has been the practice in the past as far as the mine workers are concerned that as an organization they have carried thousands of dollars of their own relief in the way of distress money, and as I said, they are not looking for charity or relief.
I call attention to another item from the town of Glace Bay, dated May 8, relating to relief. The town of Glace Bay has a population of about 26,000, and approximately 7,000 of the 12,000 miners of Nova Scotia are centred in and around that town. This is the section in which two mines are threatened with closure. It affects not only the miners directly but also the business people and the institutions that have been built up in that community in the past thirty years. This dispatch, dated Glace Bay, May 8, reads: Decision of the town council in session tonight was that the case of miners being unable to get work was a responsibility of the provincial government, as the town of Glace Bay could not provide for the men who are unable to get further employment at collieries where they have been employed in the past.
Two of these mines are being gradually closed; men are being added to the ranks of the unemployed; the mines that are operating are overcrowded, and so many men report for work, go into the mines, stand in the bottom two or three hours and then wend their way home, spending probably four or five hours, and earning absolutely nothing. The situation in that area with respect to 
coal mining is becoming very serious. Just before I left for Ottawa I was called from section to section of that constituency, and the people themselves, without any solicitation from any political organization or union, met as citizens and prepared briefs to be presented to the different governments.
I should like to read something I have before me which sets out the situation in the area in question. The document I have before me is from Morien, in Cape Breton. It is dated May 5, 1940, is drawn up by a citizens' committee, and reads:
At your request your committee has compiled a brief resume of the adverse conditions under which the people of Morien and Birch Grove have been labouring for the past ten years and some suggestions as to how they may be remedied.
When the colliery at Birch Grove closed down in 1929, all those employed there were compelled to seek employment elsewhere, the most of whom obtained employment in the collieries in Glace Bay.
A workmen's train leaves Morien daily at 5 a.m. and returns at 5 p.m. conveying the men back and forth to their work, this means that they are twelve hours away from home, have to spend long hours on the train leaving no time for leisure or to take any interest in the affairs of the community.
Since the colliery closed at Birch Grove ten years ago, very few of the young men that became of age during this period were able to obtain jobs of any kind, the result is that there are now over 200 young men in these two communities between the ages of eighteen and twenty-six years who have never had any steady employment of any kind.
Morien at one time was a thriving, prosperous mining town with a population of three thousand people who earned their living in the mines that were in operation here. The population has now decreased to about one thousand people who are mostly dependent for a living on what work they can obtain in the Glace Bay collieries.
The town as a whole is slowly decaying. The workers are all in the "low income group" and do not obtain enough in wages to maintain their homes properly, and are not able to contribute very much for the support of the school, churches or any civic improvements.
The solution to our problems is to have a coal mine opened in this district and place all the men from Morien and Birch Grove who work in collieries Nos. 2, 4, 11 and 24 at work in the new mine. All the unemployed young men could be placed at work as the mine was developed and our community would take on a new lease of life.
All the coal areas within this district are owned or controlled by the Dominion Coal Company, a large section being held under the ninety-nine year or blanket lease.
In 1923 a geologist in the employ of the Canadian geological survey made a thorough examination of this district and his report is published in "memoir No. 133" of the federal department of mines. This report deals in
reat detail with the coal seams in the Morien
asin and sets forth plainly	that	there are fourworkable seams of	coal in	the	Morien	areas,containing millions	of tons	that	can be	easilymined, and readily	sold in	the markets	of the
Unemployment Relief-Mr. Gillis
world, for in the days when the Blockhouse and Gowrie seams were being mined by Belloni and Archibald, these coals established a reputation that was second to none.


Joseph Henry Harris: What is the hon. member quoting from?


Clarence Gillis: I thought I made that clear. I am quoting from a brief drawn up by a
meeting of citizens in the town of Morien, Cape Breton, Nova Scotia. The brief was drawn up for the purpose of having it presented to the local government, and I was instructed to bring it here and, if possible, draw it to the attention of the Minister of Labour, through the medium of the House of Commons.


Alfred Johnson Brooks: What is the date of it? Mr. GILLIS: May 5, 1940.


Some hon. MEMBERS:: Go ahead.


Clarence Gillis: It continues:
Some years ago a delegation of citizens in this town accompanied by members of parliament for this constituency and by the U.M.W. executive interviewed Mr. H. J. Kelly the general manager of the Dominion Steel-Coal Corporation in regard to future mining operations in this district and at that time Mr. Kelly stated that there was no question of the quality or the quantity of the coal in the Morien areas and that their corporation intended to open a colliery in Morien just as soon as the market for coal had increased enough to warrant it.
The time has now arrived when we believe we are justified in asking Mr. Kelly what they are going to do. With the war on the demand for coal has increased considerably and with two large collieries closing down within a short time, conditions should now warrant opening a new colliery in Morien.
The Dominion Steel-Coal Corporation receives large sums of money from the federal government in the form of bonuses for the coke they manufacture from coal and also receive assistance in the form of railway subventions to enable them to market more of their coal in western Ontario. This money is paid direct from the federal treasury and is raised by taxing all the people of Canada to which we contribute our per capita share and we take this opportunity to suggest to our representative in the federal parliament to put forth every effort he can to have these bonuses increased and the subventions extended so that there will be a larger market for coal from Nova Scotia.
In a very short time Dom. No. 11 colliery will be closed down and as there are about one hundred men from this district employed there, some provision will have to be made soon to find them employment or the local government and the municipality will be called on to provide them with relief.
If the Dominion Steel-Coal Corporation could be induced to start mining operations in this district in the near future, there would be no demand for relief and as an inducement to the corporation to make a start we would suggest that the government of Nova Scotia offer them exemption from the payment of royalties on all the coal produced in Morien for the next four years.
As a further inducement we suggest that the municipality set their assessment at about 50 per cent of their valuation for taxation purposes for the next four years on any new colliery they may start in this district.
From time to time we have heard that the corporation has plans to sink a shaft to the Gowrie seam near the shore, so as to mine the submarine areas of the Gowrie seam and also to win the Blockhouse seam by a cross-measures tunnel. There has been a proposal to sink a deep shaft to the Tracy seam in the Beaver dam section and also one to open a Slope mine on the north outcrop of the Gowrie seam. If any one of these proposals were to be carried out, it would meet with our entire approval and the company would receive the wholehearted cooperation of all those who reside in Morien.
The coal areas of this province are the property of all the people and should be worked for their benefit and the dead hand of a monopolistic corporation should not be allowed to cast a blighting shadow over this town of ours.
If we believe the democratic principle that human rights come before property right we then have every justification in appealing to our representatives in parliament and our leader ill the united mine workers to put forth every effort to have a new mine opened in this district.
This is signed by a citizens' committee.
I should like to draw to the attention of the minister another brief presented in the town of Glace Bay, where this No. 11 mine is threatened with closing. At the present time it is being gradually closed.


Norman Alexander McLarty: I should not like to interrupt my hon. friend, and I am trying to gather the suggestions he makes. I am wondering however if, rather than read the whole of the brief, he might not give us a digest. I make the suggestion in the most kindly fashion.


Richard Burpee Hanson: Go ahead and put it on the record.


Alphonse Fournier: I would draw standing order 58 to the attention of the hon. member, where it is stated that speeches in committee of the whole must be strictly relevant to the item or clause under consideration. I do not believe the reading of a brief would be permissible, under a strict interpretation of the rule.


Norman Alexander McLarty: I do not suggest that
what the hon. member is reading is not relevant, but I am suggesting that he might give us a digest rather than the full text.


Richard Burpee Hanson: Go ahead and read your brief.


Mr. MacINNIS:: I would draw to the
attention of the chair the fact that we are discussing a resolution preceding a bill. We are not discussing any particular section or subsection. The whole question of unemployment, and the application of unemployment

Unemployment Reliej-Mr. Gillis
and agriculture relief legislation, is open for discussion. I think the hon. member who, for ithe first time is presenting the case of the working classes in the maritime provinces, ought to be given an opportunity to place his case before the House of Commons.


Clarence Gillis: Mr. Chairman, my conception of the resolution before the committee, and particularly the first part of it, was that it dealt with unemployment. It would appear that the Department of Labour is asking for an appropriation of money for the alleviation of unemployment, and in order that the minister may fully understand the requirements af the situation I suggest that one of the first things he should know is the unemployment situation as it exists in the field.
I have read many reports on unemployment as it affects my own constituency, but in those reports I did not recognize the situation as I knew it. I did not recognize the situation from the report which had been drawn up by someone else. What I am endeavouring to do is to tell the Minister of Labour the story of labour when considered from the viewpoint of potential unemployment. Mines are being closed and the situation is growing worse. I should like to tell my story as I see it myself.
I want to draw this brief to the attention of the Department of Labour. For the past seven or eight years different ministers of the provincial government have done everything humanly possible to cure this situation. I do not say this with any political malice, but I believe absolutely that at the present time the Nova Scotia government is the British Empire Steel Corporation, especially as far as coal is concerned. That has been our experience. Not so long ago a mine in Thorbum, Nova Scotia, was to be closed. This meant that many men would be thrown on to the scrap-heap. The general manager of the Dominion Iron and Steel Company, Mr. H. J. Kelly, sat in with a delegation of citizens from that town. The head of the citizens' delegation asked Mr. Kelly if there was anything the provincial government could do to develop a mine in that area. I based my previous statement that as far as coal is concerned this company directs the provincial government upon what Mr. Kelly said to that committee. His answer was that as far as the government was concerned they had done everything they could, but the company had said there would be no new mine opened in that area.
The particular brief which I have before me emanates from a citizens' committee which was formed in Glace Bay. This was not drawn up by members of a union or by

workers alone. This committee was headed by Reverend Father McKinnon, a Roman Catholic priest. The Reverend Mr. Crew, an Anglican clergyman, was also a member. The Reverend W. T. Mercer, another clergyman, was a member. This committee represented a more or less united front as far as religion is concerned. There are approximately 900 men employed in this particular mine, and they have learned from their union that the mine will be totally closed down within eighteen months. There are many schools and churches in this locality, and the working people have a considerable investment in their community. Should this mine be closed down, it will be nothing less than a financial bombshell as far as the town of Glace Bay is concerned, because that town receives considerable revenue by way of taxation. The provincial minister of mines and his deputy came to Glace Bay and met the members of this committee. I was present at the sitting of the committee, and we went over the plans of the coal company and considered what prospects and possibilities there were to continue the operations of this particular colliery. We could receive no assurance that operations would be continued. I was then asked to bring up the matter before this house and draw it to the attention of the Minister of Labour. This brief is headed "Introductory brief " and reads:
This committee which is gathered here was selected at a large and representative citizens' meeting held in the legion hall, Passehendaele, Glace Bay, on the evening of April 8, 1940. The meeting was held as a result of the existing conditions in No. 11 colliery as affecting that community for the purpose of endeavouring to find some method to alleviate those conditions.
In the report of the royal commission respecting the coal mines of Nova Scotia which was made in 1932 (commonly called the Duncan report) certain definite proposals are recommended for the reallocation of coal areas and concentrations of the output of coal mines. As a result of the recommendations contained in the Duncan report and apparently with the approval of the government of Nova Scotia a situation has arisen in the No. 11 colliery which has become very acute. Present indications are that this mine will be totally abandoned in approximately eighteen months. A large percentage of the men employed in this colliery are so affected at the present time that no work is available for them and transfers to other collieries are a common occurrence.
We submit that the practice of transferring these men to other collieries operated by the Dominion Coal Company will not provide a practical solution to this problem. Twenty-two men who were previously employed in No. 11 colliery have been transferred to No. 4 colliery. No. 4 colliery is completely filled up at the present time, and there are no places available for any -more men. There is no development work being carried on in this mine but future operations will consist only of pillar work.

Unemployment Relief-Mr. Gillis
By way of explanation I would say that pillar work is done only when a mine is gradually folding up. This work is done only when it is considered a mine will eventually close. The brief continues:
Several men have also been transferred to No. 24 colliery. On April 10th, 13 pairs of men were without places in No. 24 colliery and another section in this mine is due to close in about two weeks which will displace another 10 pairs of men. In No. 2 colliery there are at the present time approximately 40 pairs of men without places and eighty per cent of the work in No. 2 colliery is pillar work. No. 1-B colliery is overcrowded at the present time ' due to the fact that a large number of men formerly employed in the reserve collieries have become transferred to this mine. There are now 40 pairs of men employed on each shift in No. 20 colliery and the company does not propose to employ any more men in that mine for the present. As No. 20 colliery is developed it will be used to take care of men who are displaced in No. 2 colliery.
Taking into consideration the conditions which exist in all these mines in the Glace Bay district, it can be clearly seen that the problem of providing employment for miners who are displaced in No. 11 colliery will not be solved by transferring these men to other collieries. There are at the present time approximately 800 men employed in No. 11 colliery, the great majority of whom live in the Passchendaele district. These men, together with their families and other residents of the district, make a total of approximately 3,000 persons who depend directly for their livelihood on the continued operation of No. 11 colliery. There are also many houses, halls, churches, schools and business establishments in this district which would in time be rendered useless if this mine were allowed to close without any adjustment being made. In addition to this the town of Glace Bay has in recent years carried on new development work in this district by providing the comunity with new sewer and water facilities.
The additional burden which would be placed upon the town of Glace Bay through unemployment caused by the gradual closing of No. 11 colliery would be one which the town is in no position to bear, and it would be impossible for the town to adequately cope with such a problem. We feel that such a situation should not be allowed to arise without a thorough investigation being made by those with the authority to make such an investigation into the possibilities of a continuation in operation of No. 11 colliery and also the possibility of the opening of a new coal mine in the same district.
We, therefore, respectively ask that an engineer with governmental authority conduct a thorough investigation into the conditions which exist in No. 11 colliery for the purpose of finding out what amount of coal is available for extraction in accordance with the terms of the leases granted to the Dominion Coal Company. If, as a result of this inquiry, it is discovered that the colliery will be worked out in a short time and closed down, we ask that every avenue possible be explored with the view to the opening of a new mine in the Passchendaele district.
The provincial minister of mines and his deputy are cooperating with the miners one
hundred per cent in an effort to find a solution to this problem. The leases held by the coal company are such that by the carrying on of certain operations these leases remain in force even though a mine may not be working. Therefore the company is in a position to hold the leases. The provincial government does not seem to have sufficient authority, or at least has not had up to date, to bring about a solution of this problem. Coal will probably be required in Europe. Press dispatches rep>ort that France is in a bad way as far as coal is concerned. Something should be done to develop those coal areas in Nova Scotia which are not being operated by the coal company at the present time.


Alphonse Fournier: I am sorry to have to interrupt the hon. member, but he has spoken for forty minutes. He has, of course, the right to speak again on the resolution.


Karl Kenneth Homuth: A great deal of leeway, Mr. Chairman, has been allowed to all the members ever since the house opened, and I think it is only right that the hon. member should be permitted to continue.


Alphonse Fournier: Certainly, if it is the wish of the
committee.


Clarence Gillis: It is not my intention to occupy very much more time, Mr. Chairman. But I did want to tell that story, and I think it is the first time it has been told in that way in this house. We feel that it is the obligation of the government to see that the people who are trying to do something for themselves are protected, and with respect to the creation of monopolies we feel it is the obligation of the government to see that no special groups be given easy and fat franchises out of which to amass untold wealth at the expense of the people, whether these franchises have to do with the monopoly of money, minerals, waterfalls-or other forms of power. There are certain things that we must not pass over to individuals, and we feel that a national resource such as coal is one of those things. We believe it is the function of the government to see that every other business is properly conducted by charter from the government, and that it obeys the rules of the game and is not permitted to assume a monopoly of power as so many have already done. We remember the revelations of the price spreads committee, whose report showed that many things were wrong in Canada, rotten in fact; yet the findings of that committee have travelled to the silence and dust of the upper shelves and nothing has been

Unemployment Relief-Mr. Hlynka
done about them. We believe that it is the business of government in this country to equip the people with the instruments of freedom and then see to it that they have the full power to enjoy that freedom. We believe that it is the business of government in this country to make it possible for all to get enlightenment, without which no people can live in a free democracy, as is well exemplified by Germany at the present time. We want it clearly understood that it is not the possession of wealth and riches that we are objecting to so -much, but rather that wealth should enjoy freedom to control the economic processes of the country and stand in the way of the creation of other wealth by the people. They are the bottle neck through which new wealth must pass before it gets to the people.
As I said at the beginning of my remarks, we are looking to the governments of Canada as at present constituted to see to it that the development of the cooperative as it exists in the maritimes, where it is well away on the road to success, is protected against such monopolies as the coal company which I have attempted to describe here to-night. We believe it is the government's duty to see that the company is not in a position to cripple that movement by virtue of the fact that it holds economic power over the lives of the people in that particular section.


Mr. A. HLYNKA (Vegreville):: Mr. Chairman, may I first of all present to the committee a resolution sponsored by the United Farmers of Canada, Alberta section, signed by 2,049 members of that organization. The following is the text of the resolution:
Whereas there appears to be no provision in the present wheat board act to allow the board to make a further payment on wheat delivered to it from the 1939 crop;
And whereas conditions have changed considerably since the passing of the act and this country now faces the exigencies of war;
And whereas it appears to be an imperative necessity to maintain an adequate supply of agricultural products;
Therefore be it resolved that we the undersigned United Farmers of Canada, Alberta section, respectfully urge the dominion government. under the powers conferred upon it by the War Measures Act, to authorize the wheat board to make an additional payment on all wheat delivered to it from the 1939 crop, in time to enable the wheat producers to finance their seeding operations this spring and to carry on production efficiently during the duration of this war.
This resolution was passed some time ago, but the whole matter is as important as it ever was.
I do not think it is necessary for me to elaborate on this resolution, but I think the
[Mr. Gillis.l
minister should give this committee some idea of the attitude which the farmers of western Canada may expect from the government with regard to this question.
There has often been used on the floor of this house a word which has struck me, namely, the word "assistance". Neither our farmers in western Canada nor, it seems to me, the employees in this country, are asking for assistance. We are simply asking for what is due to us, and we believe that our farmers in western Canada are entitled to more than they are getting. With the gravity of war now much accentuated, we believe that unless the interests of the farmer are taken care of and protected in every way, unless agriculture which we all know to be our basic industry in this country is assisted, if you like, the morale of our people, as the hon. leader of our group has said, may not be strong enough or of just the type to carry us through the war.
It has seemed to me that a number of members on the government side have frequently referred to the state of war as if to excuse themselves from carrying out their obligations towards the farmers and the workers. But I want to emphasize the point, that the government at this time should not in any way use war as an excuse for not granting to our farmers in western Canada what is due to them.
In closing, I simply wish to add that unless our farmers are looked after better than they have been for the past ten years, I do not know that their morale will be high enough to carry us through this strenuous time.
Mr. E. G. HANSELL (Macleod) Mr. Chairman, I have listened with a good deal of interest to the speech of the hon. member for Cape Breton South (Mr. Gillis). In his presentation of the situation in the coal mining area in his riding, there is reflected the situation that exists in almost every coal mining area in this country. I congratulate the hon. member upon his speech, and I am quite certain that the House of Commons will find him a valuable member in championing the cause of the workers of this country, particularly the coal miners. I should like to say a great deal about the coal miners and the coal mining industry of Canada, but I shall reserve my remarks until the estimates dealing with coal subventions are before the committee of supply. I am convinced that the coal miners' problem cannot be solved until we are able to sell the coal. An hon. member has stated that there is a great deal of coal available, and yet the mines are, as he termed it, folding up. At the same time we know that

Unemployment Relief-Mr. Hansell
in Canada people and industry need coal. That is the peculiar anomaly of the whole situation.
This resolution is the kind of resolution which is presented, apparently, every year. It takes in a good deal of territory. It proposes a measure "to provide assistance in the alleviation of unemployment and agricultural distress." It is also for the purpose of "supplementing the measures taken by the provinces towards providing assistance to those in need." Further, it is for "establishing unemployed persons in employment." I am not sure that I know what that means, but I am under the impression that it means the setting up of employment bureaux. That is a good thing, provided the employment is available.
Then the resolution continues, "and training and fitting suitable persons for productive occupations." I believe that is what is generally termed the youth training scheme. We are all happy to have in these days a scheme of that kind, but I sometimes wonder whether it is extensive enough. Many of our young men are taking this youth training, but it seems to me that they are trained in more or less elementary types of work in the various trades. For instance, a young chap interested in mechanics goes to the youth training quarters and there learns how to tear down the engine of a motor car and put it back again; he then tries to find a job in a garage. I suggest to the minister that he may discover in Canada a great need for technical and expert men. As regards pattern-makers, for instance, I was told the other day that the men who were trained in years gone by in this vocation are growing old, some of them passing out of the picture; yet, because we have been going through ten years of depression and distress, there are few men now qualified to take their places. I understand that the same circumstances apply to the tool-making trade. I suggest that it might be well for the minister to spend some time and thought on the provision of more extensive training of our young men than they now obtain under the youth training scheme.
After all, one wonders just how these young men fare after they have taken the youth training which is offered to them. I wonder if the experience of the rest of the country confirms such facts as I know of in my own constituency. Young men take the youth training scheme, remaining for three or four months during the winter, or whatever the length of the course is, and then go home, and, apart from knowing a little bit more about the subjects which they have been studying, they are but little better off and are unable to find jobs. Therefore I suggest that the
basic need is something more than youth training. We in this comer of the house believe that the basic need is a proper adjustment of the present financial and economic arrangement of the country.
I do not think I will say anything more on this matter, except to ask the minister two questions. They are entirely distinct, and perhaps the minister can more readily answer them if I ask them one at a time.
Would the minister place on Hansard the amounts which have been granted under this act to the several provinces over the past five years?


Norman Alexander McLarty: I should be glad to place upon the table a statement of the advances made during the past five years. I believe that the act came into operation in 1930. At any rate, I shall be glad to place on the table a statement of advances from that time.


Mr. HANSELL:: Would the minister care to place it on Hansard?


Norman Alexander McLarty: I am willing to place it either on Hansard or on the table of the house.


Ernest George Hansell: If it is placed on Hansard, people throughout the country will leam a little more about it.
My next question may seem to be a peculiar one, but I have thought quite a little about it. Is any record kept of the number of youths who have taken training under the youth training scheme and who have now enlisted in his majesty's forces?


Norman Alexander McLarty: The details in connection with the youth training movement are fairly complete. I would appreciate it if my hon. friend would allow me to reserve an answer to th&t question until I can get the information definitely, but I believe, subject to correction, that there are such figures.


Ernest George Hansell: If it would assist the minister, I could place the question on the order paper.


Mrs. D. W. NIELSEN (North Battleford):: I was pleased this evening to hear the Minister of Labour (Mr. McLarty) say that he did not intend to cut short the debate upon this resolution. In my opinion the resolution is one of the most important which as yet has come before this house. All of us are aware that the people of Canada are watching carefully the deliberations which are going on here. I feel sure that they have watched and listened with great interest to what this government intends to do with regard to the prosecution of the war. But I should like to draw attention to this fact, that whatever happens in Europe, whatever happens with regard to our delibera-

Unemployment Relief-Mrs. Nielsen
tions in this chamber, throughout the length and breadth of Canada every single day, three times a day, thousands of people are faced with this one great question, "When do we eat, and how?"
In the past, with regard to its domestic policy in looking after the people of this country who through no fault of their own find themselves destitute and without employment, the government has not an enviable record. Whenever it was suggested that money should be provided to assist those who were unemployed or to alleviate farm distress in the west, this government has replied "Where is the money to come from? There is no money." Well, I would point out that, when a war crisis appears, 1700,000,000 can be immediately found.
To many people in Canada the domestic crisis is one that looms as important in their minds as the war crisis. It affects the people of this country. It is vital to them, because the future of this country depends upon the welfare of its people. It is not so very long ago that we went through a great economic crisis. We found that the economic problem, the problem of unemployment, was not solved by this government. We had some of our best boys wandering from the east to the west, boys called vagrants. They were given very little assistance. We had farmers in the west facing a situation which was beyond them, and they were absolutely unable to cope with it. The province of Saskatchewan particularly was brought to bankruptcy and the people of Saskatchewan looked to the federal government for assistance. They were faced with the same question: Where is the money to come from? In the opinion of Doctor Weir, Minister of Health of British Columbia, the evidence available shows that at least a third, or more likely a half, of all our Canadian people are existing on incomes of less than $1,000 a year. When so many of our people are living on such an income, the question of health is going to be something which will be brought up before governments of the future as being a responsibility left over from these days. We are not attempting to do anything towards the solution of this problem.
The health of a nation depends upon two things. It depends upon the standard of living of its people and it depends upon adequate health services. This federal government has done nothing, as a federal matter, with regard to health services throughout the length and breadth of the country. The question of the standard of living of our people has also been sadly neglected. I believe that during the last war, during those four years of war, we Canadians lost 60.000 men. We have built a great
fMrs. Nielsen.]
memorial to them. They were soldiers who gave their lives in the great cause. Do hon. members realize that because of our lower standards of living, because of our lack of good health services, in the four years that followed 1931 we lost 70,000 more soldiers-little fellows this time, under a year old, struggling in the greatest battle of life? They lost out because this country did not equip them. These matters are a government responsibility. If we take into consideration also the mothers who gave their lives, we have in those four years a loss of 103,000 persons. Their names are not known. They are Canadian heroes who are "unwept, unhonoured and unsung"; and if this government does not accept its responsibility towards the people, I am afraid that in generations to come it is going to be held responsible for this serious situation.
Whatever else the common people lack, they have one great asset: The common people have common sense. And, thank goodness, they are beginning to use it. We know that, owing to this government's policy during these last few days, in the months to come the living conditions of the Canadian people are going to grow steadily worse. I have no hesitation whatever about saying that. I am sure that time will prove my statement correct. During these last few weeks we have appropriated $700,000,000 for the prosecution of the war, $750,000,000 for the payment of loans, and so on. This government, following the policy of the past, is raising this money by taxation and by borrowing. When the common people think of taxation, they think of what has been taxed in the past, and they realize that if this government taxes as it has always taxed, it will be the food, the clothing and the small pleasures of the common people which will be taxed, not the great wealth that lies in the hands of a few within this dominion. Therefore the living conditions of the people of Canada during the next few months are going to deteriorate.
We know also that, for the purpose of borrowing, this government will shackle generations yet unborn with a burden of debt which will be carried on to the future, and children not yet bom will bear the debt of this war as we to-day are bearing the debt of the last war. The common people realize these things. It was interesting to me the other evening to see that a bill was brought forward for the appropriation of $100,000 to provide for the parks and open spaces of this city. Yesterday I received a letter from the northern part of Saskatchewan. It is also quite interesting. I should like to read it to

Unemployment Relief-Mrs. Nielsen
the committee. It was sent to a man who is living away up in the northern bush. It
reads:
Dear Sir:
Due to the fact that the government is unable to obtain sufficient funds to finance the present cost of relief, I have received instructions that only the most needy cases are to receive assistance. You are therefore advised that no further relief will be given you and that from now on no assistance will be given you under any circumstances.
W. Schmidt,
District Inspector.
The man who received this letter writes to me as follows:
Enclosed find a letter which most of us on relief received this month in place of our order. Despite the fact that just now there is hardly any of us who have funds, we have been cut off. You know how it is up here. My case is soon explained. Last fall I threshed 290 bushels of wheat and 490 bushels of oats. I got 31 cents a bushel for my wheat. I had to pay $36 threshing bill, $14 for breaking, $13 for taxes and for some other expenses such as cutting twine and so on. For three months I received no relief. During last winter I had $5 a month relief for a family of five, three little children, three years, two years and one three months old. It looks as if that is the kind of payment we are getting for not voting liberal up here.
That is only one instance.


Norman Alexander McLarty: Would the hon. member be kind enough to let me have a copy of that letter?


Dorise Winifred Nielsen: I shall be most pleased to do so.


Norman Alexander McLarty: I shall see that the matter is investigated at once.


Dorise Winifred Nielsen: Thank you. The question which northern Saskatchewan is facing at the present time is perhaps one of the most serious it has had to consider for some years. As some hon. members know, it was the southern part of Saskatchewan that suffered from the drought at one time, a situation which was acute; but during the last few years it has become noticeable that the drought belt has been moving northwards. I received another letter which I might read:
We are facing another terribly dry year. We have not had a rain to wet the roof of the house since the snow went, as you likely know. There was enough moisture in the summer fallows from the snow to start the wheat, but it cannot live much longer if we don't get rain. The grass is burning fast and the gardens not starting at all. The same old story.
This was written on May 26. Hon. members can picture the plight of these people, cut off relief and facing a crop failure, as far as they can judge at the present time. What 95826-34
are their reactions to the deliberations of this house? They are expecting that this government will at least continue with relief as it has done in the past and provide some better sustenance for the people. I have recently received from Saskatchewan a letter which will give the committee as nearly as possible the relief situation:
The relief inspectors have during the month of May informed the councils that the municipalities will have to take care of the indigents who are residents of the municipality without any further assistance from the government. In the case of one of the municipalities, this has meant that whereas up until the end of May they received $570 per month as a direct relief grant, they will not receive any further grants after the first of June, and that of course means that the resident ratepayers will have to be taxed to meet the additional costs imposed upon them. With farm commodity prices at their present levels and with the burden of debt from which the farmers already suffer, the additional taxation will create a very difficult situation.
I suggest that this government make a serious and detailed study of the amount of assistance which is going to be needed by the farmers of the west during the coming years. I suggest that this government find the money for the people of this country who are in need of it, as they have found the money for the war crisis; for the domestic crisis in this country is of equal importance and perhaps of more far-reaching importance.


Norman Alexander McLarty: I understand that there are other matters which require consideration. Obviously we are by no means finished with this debate. Therefore I should like to move that the committee rise, report progress and ask leave to sit again.
Progress reported.



SOLDIER SETTLEMENT


[Stage Direction]
Hon. T. A. CRERAR (Minister of Mines and Resources) moved that the house go into committee to consider the following resolution:
That it is expedient to introduce an amendment to the Soldier Settlement Act to authorize the director of soldier settlement, with the approval of the minister, to grant to the original soldier settler the mines and minerals acquired with the lands, and also to authorize the director to dispose of mines and minerals underlying land not under purchase contract by an original soldier settler.
Motion agreed to and the house went into committee, Mr. Vien in the chair.
Mr. CRERAR:: A few words of explanation of this resolution will be in order. There is a curious anomaly in the Soldier Settlement Act

Soldier Settlement Act

of 1919 respecting the disposition of minerals that may be found in or under the land; I think that is the descriptive phrase which is usually employed. This applies chiefly to the three prairie provinces. These areas were under federal control entirely until the western provinces were set up. In the early days, when land was alienated from the crown, the first alienations paid no regard to the minerals. Later on, the precious metals were reserved by the crown; that is, the title to precious metals in or under the ground did not pass to the purchaser. Later still, that reservation was extended to all minerals. When the Soldier Settlement Act came into operation, lands for soldier settlers were acquired not only from crown granted lands but from lands held by private owners. In some instances the land purchased from private owners carried with it title to the minerals. In other instances the minerals were not transferred, being reserved by the private owner. The amendment proposed here seeks to make clear that where title to minerals was received through the acquisition of land for soldier settlers, it can be passed on to him now.
The question may reasonably be asked why it is necessary some twenty odd years after the passing of the original act to bring in a measure now to clear up this point. It is due mainly to the fact that in certain parts of Alberta oil has been discovered, and it is expected that, in the future, oil may be discovered in other areas where soldier settlers have acquired lands.
At the time of the passing of the original act, land or lands were defined as follows:
(i) "Land" or "lands" includes granted or ungranted, dominion, provincial or private lands, and real or immovable property-


Richard Burpee Hanson: It covered the whole field.


Thomas Alexander Crerar: -messuages, lands, tenements and hereditaments of any tenure, and real rights, easements and servitudes, streams, water courses, waters, roads and ways, and all rights or interests in, or over, or arising out of, and all charges upon, land or lands as herein defined.
From a reading of this, I think it will be clear-I am so advised

that if a soldier settler came into possession of land from a private owner who under his title owned the minerals and was willing to pass that title on to the soldier settler, he was entitled to receive it. That is made clearer still, I think, if an examination is made of the discussion in parliament at the time the act was passed. It was not intended, and it never happened, where the soldier settler acquired land direct from the crown, that the minerals passed with 'Mr. Crerar.]
it, because t'he general reservation that was put into effect years before, governed such alienation.
Curiotisly enough, section 57 of the Sr'dier Settlement Act, which section is now being repealed, reads:
From all sales and grants of land made by the board, all mines and minerals shall be and shall be deemed to have been reserved, whether or not the instrument of sale or grant so specifies, and as respects any contract or agreement made by it with respect to land it shall not be deemed to have thereby impliedly covenanted or agreed to grant, sell or convey any mines or minerals whatever.
The definition of lands I read a moment ago indicates the intention that the soldier settlement board should pass on to the soldier settler what it received from the purchaser from whom it bought the land. The section I have just read throws doubt upon the power of the board to do this, and it is to clear up that doubt that we ask the repeal of the section.
There is one other point to which I should like to draw the attention of the committee for a moment. The resolution states, in part:
.	.	. and also to authorize the director to
dispose of mines and minerals underlying land not under purchase contract by an original soldier settler.
A good many instances have arisen where the soldier settler has passed out of the picture. That is, the land has come back to the director of soldier settlement. We are making it clear that in such case where the land reverted to the director of soldier settlement, and is again resold to a civilian, the mineral rights do not pass. In other words, the mineral rights pass only to the bona fide soldier settler who acquired them through the board by purchase from some private party at the time he made his selection. I hope I have made clear to the committee the purpose of the amendment.


Richard Burpee Hanson: I am not sure that the minister has made himself clear to me, but that might be my fault and not that of the minister. In the older provinces I think the general rule has been that the mines and minerals in and under the earth have never passed with the original grants and the crown has always reserved those mines and minerals.
As I understand it, the minister is dealing with lands in the three prairie provinces which, at least in one category, were lands that were the property of the crown in the right of the Dominion of Canada. And in the case of soldiers who took up those lands the minerals lying in or under the lands were

Soldier Settlement Act
expressly reserved to the crown. I understand those are not being affected by this proposed legislation.


Thomas Alexander Crerar: Correct.


Richard Burpee Hanson: The crown still retains the mineral wealth under the land, including oil. I suppose oil comes under that category. But in the case of lands purchased by the soldier settlement board from individuals who had already received grants from the crown in the right of the dominion, do I understand the minister to say that in such cases there were occasions where the mineral rights had passed to the person who sold to the board, and that those subsequently were reserved when they passed to the soldier settler? It is in respect of those cases the minister now wants to vest the mineral wealth in the original soldier settler. That is the way I understand the minister's explanation respecting the first part of the resolution. Am I correct?


Thomas Alexander Crerar: I think that is correct.


Richard Burpee Hanson: There are two categories with which I have dealt. All these lands were originally crown lands vested in his majesty in the right of the dominion. Was there ever a time in the history of the issue of these grants of land to the prairie provinces when the original grants did not reserve to the crown the mineral wealth?


Thomas Alexander Crerar: Yes.


Richard Burpee Hanson: Then that would explain the difficulty which has been in my mind.


Thomas Alexander Crerar: I have my notes before me, and they seem to make that point clear. Until 1883 all mineral rights were granted.


Richard Burpee Hanson: That
explains it, of course.


Thomas Alexander Crerar: Those who are familiar with the early railway history associated with the building of the Canadian Pacific railway will recall that there were considerable grants of land to that railway to assist it in the building of its transcontinental line.


Richard Burpee Hanson: And the mineral wealth passed with those grants?


Thomas Alexander Crerar: Yes; the mineral wealth passed with the grants prior to 1883. In the time between 1885 and 1887 only the precious minerals were reserved; in other words, coal and oil were not reserved. During that period, of course, lands passed to companies and to individuals who resold, and in those resales there were occasions when the owner reserved the mineral rights, while in other cases the mineral rights passed.
95826-34J
That brings us back to the amendment we propose here; where they did pass, and went along with the land, and such land was later acquired by the soldier settlement board for a soldier, we are attempting to make it clear beyond doubt that we can pass on to him all that we received when the land was purchased.


Richard Burpee Hanson: What has given rise to this legislation? I suppose the minister will answer that the discovery of oil has been responsible.


Thomas Alexander Crerar: That is one reason.


Richard Burpee Hanson: Of course that would be a perfectly legitimate answer. But is there not something more than that? Have the soldiers applied for this change? How many applications are there? What is the value of what we are giving them? I would not want to deny a soldier anything; I want to be generous with the soldiers, but I should like to understand what we are doing.


Thomas Alexander Crerar: As I recall, several instances have arisen where soldier settlers desired to dispose of mineral rights. They had thought they had the right to dispose of those rights. Certainly as I read the definition of the term "lands" in the Soldier Settlement Act-and I believe I am supported in this by the law officers of the crown-it was evidently intended that the mineral rights in such case should pass to them.


Richard Burpee Hanson: I should think it would depend on the terms of the conveyance.


Thomas Alexander Crerar: Possibly.


Richard Burpee Hanson: I would think absolutely.


Thomas Alexander Crerar: There is, however, a doubt in section 57 of the Soldier Settlement Act, where it is expressly stated that "from all sales and grants of land made by the board, all mines and minerals shall be and shall be deemed to have been reserved." According to opinions which have been given to me, there is a conflict between the two sections in the act, and it is now our intention to clear up that difficulty.


Mr. WRIGHT:: What would happen to the mineral rights of an original soldier settler who sold his land to another soldier settler, through the operations of the board? ' Would those mineral rights revert to the crown, or would they go to the soldier settler in person? Where would the rights be?


Thomas Alexander Crerar: If the soldier settler in the first instance acquired the mineral rights, then
Soldier Settlement Act

they would pass on to the next soldier settler. That is the point we desire to make clear in the legislation.


Percy Ellis Wright: But in this instance they were crown lands, or school lands, in the original contract.


Thomas Alexander Crerar: No, if the first soldier settler to whom the hon. member refers acquired his land direct from the crown, then the mineral rights were not conveyed with it and, of course, do not pass on to anyone else.


Percy Ellis Wright: They would still remain
with the province?


Thomas Alexander Crerar: Still remain in the crown.


Mr. COCKERAM:: From what the minister has said, there are soldiers owning lands who think they also own the mineral rights. I take it that the government has been approached to purchase these mineral rights.


Thomas Alexander Crerar: Does the hon. member
mean "approached by the soldier settler?"


Alan Cockeram: No.


Thomas Alexander Crerar: We want to make it clear that we can pass them on to the soldier settler.


Thomas Miller Bell: How many parcels of
land will be affected by this legislation?


Thomas Alexander Crerar: It is estimated that mineral rights were acquired with the land in about 1,200 cases where soldier settlers have repaid their loans. In all likelihood, in many instances there will be no minerals involved. For instance, a soldier settler in the Yorkton district of Saskatchewan would probably have no minerals in connection with his land. I cannot inform the committee the number of cases where mineral rights are known to exist.


Mr. SHAW:: What percentage of those
residing upon soldier settler lands are the original soldier settlers?


Thomas Alexander Crerar: I cannot give that information now. As a matter of fact, it does not arise in connection with a discussion of this resolution. When the estimates of the soldier settlement board are being considered that information will be available to the hon. member.


Howard Charles Green: Is it the intention that there will be certain cases where the soldier settlement board will own the mineral rights, while the soldier settler or a civilian who may have bought out a soldier settler will own the land?


Thomas Alexander Crerar: I should say offhand that
if a soldier settler acquired mineral rights, paid for his land and then later sold 'he land

to a civilian after having acquired title, he could reserve the mineral rights if he wished to do so. That would be a matter of contract between the two individuals.


Howard Charles Green: It hardly seems fair that
the soldier settlement board should have title to the minerals, that they should not be passed on to the soldier settler or to whomever he may have sold his land.


Thomas Alexander Crerar: The only case where
mineral rights would be reserved would be where a soldier settler had acquired land with the mineral rights, later abandoned it and the land had come back into the hands of the board and then was resold to a civilian. In such a case the mineral rights would not go to the civilian.


Agar Rodney Adamson: Would the original
soldier settler have a right to the minerals on that land?


Mr. COLDWELL:: If he had paid for the
land.


Thomas Alexander Crerar: I did not get that question.


Agar Rodney Adamson: A case might arise in
Cadillac township in Quebec where men might be settled after this war is over. They would receive the right to the minerals on the land from the crown.


Richard Burpee Hanson: Not in
Quebec.


Thomas Alexander Crerar: If the land was acquired
from some individual or company having mineral rights in the land, and they passed with the land, then we are providing that that shall pass to the soldier. This is assuming that he has paid for the land. If the land is purchased for him and he fails to pay for it; if he abandons it or it is sold to a civilian, we are providing that the mineral rights shall not pass to the civilian purchaser, but shall be reserved by the board.


Howard Charles Green: In the case of an original soldier settler who dies, will the mineral rights go to his heirs?


Thomas Alexander Crerar: I assume the hon. member has in mind a case where a soldier settler had made all payments on his land and acquired title. I should think in that case the mineral rights would go to his estate.


Karl Kenneth Homuth: Is the minister sure on that? It is an important matter. If a soldier had obtained land by meeting his obligations, is the minister sure that these rights would go to his heirs in the event of his death?


Thomas Alexander Crerar: I think they would as a matter of common law.

Supply-Trade-Administration


Howard Charles Green: This resolution states that you are taking power to grant to the original settler the mines and minerals acquired with the land. I want to know if you will also have power to grant those rights to his heirs if he has died in the meantime?


Richard Burpee Hanson: Not unless it is in the statutes. I suggest to the minister that he look into that point.


Thomas Alexander Crerar: I shall get some information upon that before we are in committee on the second reading.


Major James William Coldwell: Suppose an original
soldier settler sells his land; it passes to someone else, and he has no further interest in it; is the title to the minerals vested in the original soldier settler?


Thomas Alexander Crerar: I would say that as a matter of common sense if a soldier settler acquired land that carried mineral rights, if he paid for his land and got title to it and then resold his land, he could either reserve the minerals or convey them to the purchaser.


Richard Burpee Hanson: That is not quite the question.


Major James William Coldwell: An original soldier settler meets all his obligations and obtains title to his land. He sells it to another party. Are the minerals conveyed to the original settler?


Thomas Alexander Crerar: That is the answer I gave.


Major James William Coldwell: The minister said he could either reserve or convey. Supposing there is no arrangement between the two parties; who will hold the mineral rights as time goes on?


Thomas Alexander Crerar: He has acquired title to the mineral rights with the land. That is his property and he can make any disposition of it he wishes. If he wants to sell it to my hon. friend, he can say the minerals go with the land, or he can say the minerals do not go with the land. I would say that this would be a matter of choice for the soldier settler.


Richard Burpee Hanson: This is intended to grant to the original soldier settler the mines and minerals acquired with the land. Is this intended to cover a case where he did not receive the mineral rights in the original grant? Is the soldier settler to be granted the mineral rights acquired with that land? I must confess it is beyond me.
Resolution reported, read the second time and concurred in. Mr. Crerar thereupon moved for leave to introduce Bill No. 31, to amend the Soldier Settlement Act.
Motion agreed to and bill read the first time.

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



DEPARTMENT OF TRADE AND COMMERCE

[Stage Direction]
377. Departmental administration, $106,080.
Richard Burpee Hanson: Is this item to provide under the act for aid to Canadian coal for the manufacture of iron and steel?
Hon. JAMES A. MacKINNON (Minister of Trade and Commerce): The next item deals with that. The item before the committee is for departmental administration.


Richard Burpee Hanson: Under the item it says:
An act to place Canadian coal used in the manufacture of iron or steel on a basis of equality with imported coal.
That is part of the next item, is it?


Mr. MacKINNON (Edmonton West):: Yes.


Richard Burpee Hanson: Then I would say that that paragraph is misplaced in these estimates. Would the minister explain the item before the committee, which shows a salary increase?


Mr. MARSHALL:: There are two sets of figures I should like to get from the minister, the amount appropriated for the fiscal year ending March 31, 1939, and the amount spent, and the same figures for the fiscal year ended March 31, 1940.


Mr. CHURCH:: What has the minister done with the findings of the Tory commission on coal? I should also like to know what the government is doing about a national coal supply for Canada. The report of the Tory commission never mentioned the consumer of coal at all.
Mr. CR"ERAR: This item, No. 377, deals only with departmental administration. My hon. friend's remarks would come under the next item.


Richard Burpee Hanson: The hon. member for Broadview (Mr. Church) has evidently fallen into the same error that I did. We must blame it on the printer because certainly the reference to coal should be placed under item 378.
I observe from the details on page 194 of the main estimates that the amount asked for this year for departmental administration is slightly less than last year's vote, and the number of employees is one more. Perhaps the minister would give the necessary explanation for the difference in each case. I should like to say to him that in my experience I found this a very well run department. He has a fine staff. I am sure they will be loyal
Supply-Trade-Administration

to the present minister, and he will be well advised to be guided to a great degree by the heads of the different branches, because from my experience I am sure they will not lead him astray. During the term I presided over this department I saw in it less of political interference and that sort of thing than in any other department with which I had anything to do, although I never administered any other department. The Department of Trade and Commerce was remarkably free from partisanship, and I want to give that certificate of character to the officers in that department.
Before the minister explains the slight differences from last year's vote, might I suggest to him what I suggested to his colleagues this afternoon, that having regard to conditions in Europe and the consequent restriction of our commercial intelligence service, when vacancies occur they be not filled for the duration of the war unless they are for absolutely key men who must be taken on. Let us in that way save a dollar and earn our own salaries.


James Angus MacKinnon: I was glad to hear the leader of the opposition (Mr. Hanson) make such complimentary remarks about the officials of the department over which I have the honour to preside at the moment. In my own very short experience I have found the officials living up to the reputation which the hon. gentleman has given them.
To come to the item itself, the salaries for departmental administration last year amounted to $67,170, and this year, $68,520.


Richard Burpee Hanson: There is
one additional stenographer. Does that account for the increase?


James Angus MacKinnon: Yes, there has been an increase of one in the number of stenographers.


John Ritchie MacNicol: Should not the staff be
more or less reduced in view of the fact that we cannot deal at all now with many countries where we formerly had trade commissioners? Work in the main office would be greatly reduced too, so instead of the staff being increased, I imagine it should be reduced.


Richard Burpee Hanson: What is the policy of the department with respect to salaries of trade commissioners who have enlisted? I have in mind a gentleman who was in Glasgow, attached to the trade commissioner's office there as junior trade commissioner. He was home on furlough, and immediately war broke out he offered his services, and is now commanding a battery.

Either he has proceeded overseas or he is about to proceed overseas. How is that young man being treated in the matter of salary? What is the policy as to paying salaries of civil servants who have enlisted and have gone or are going overseas in the Canadian active service force?


James Angus MacKinnon: I
have not discussed that matter either in council or with the officials of the department. At the present time the situation confronting our trade commissioners is grave. Many of them were in countries of northern Europe which have recently been overrun. Their work has ceased because they have had to leave the cities and the countries where they were located. The whole matter is under consideration by the department.


Richard Burpee Hanson: Of course they ought to be withdrawn, brought home and given some useful work in some other sphere of activity in the government service. This question of the treatment of civil servants who have enlisted and become a part of the Canadian active service force is an important one. These men must be treated fairly; they have shown great loyalty, and I for one would be prepared to be generous. I hope the minister feels the same way about the matter. I think we should have some definite statement of policy on the part of the government, because I have no doubt that many such cases will arise. Of course a policy should have been established long ago. I am just a little astonished that the minister has not met this question before. All the big companies in this country have had to deal with this question, and they have laid down policies which, with respect to permanent men, if I may so term them, have been generous. Men who are temporary employees fall of course into another category; but these officials were appointed by the civil service commission after a rigid examination; they needed a high standing before they could make the grade to become trade commissioners, and all of them have family responsibilities. I hope the minister will treat them generously, and that, when his estimates come up again for consideration, he will be able to tell us just what is being done in cases of this kind.


James Angus MacKinnon: I should be glad to do that. It might be dealt with under the item relating to trade commissioners.


Richard Burpee Hanson: It is understood that we can then discuss this matter?


James Angus MacKinnon: Yes.


Douglas Gooderham Ross: Does the minister care to give any statement with respect to

Supply-T rade-Administration
the policy of the Department of Trade and Commerce? Markets have been lost in several countries of Europe, and we shall have to work pretty hard to make up for those losses. It is important that we maintain our trade balance. It might be interesting under this item to have some statement of policy, because I do not know when we shall have an opportunity of again discussing the subject.


James Angus MacKinnon: I think there will be ample opportunity under later items for the hon. member for St. Paul's to speak particularly on that matter.


Douglas Gooderham Ross: This relates to administration, and it seems to me that the question of policy in the department could quite properly be dealt with by the minister under this item. It would perhaps facilitate the discussion of other items if we had some idea of what the policy was to be along the lines which I have just mentioned. I do not think that is too much to ask. I know that all hon. members are interested.


James Angus MacKinnon: At the present time it will obviously and necessarily be the duty of the department to seek in every place new avenues of trade. Nobody knows better than the hon. member for St. Paul's the state of the world at present and the fact that our markets in many countries are contracted and contracting very sharply. I am quite aware that this condition necessitates as far as possible finding new markets on this continent and elsewhere. The matter has been discussed in the department, and every effort will be made to increase our trade so as to compensate us for what has been lost.


Mr. PERLEY:: I believe it has usually
been the custom on this first item for the minister to state under what item we shall have an opportunity of discussing the question of marketing generally, and particularly pertaining to grain. According to the wording of the item I do not find that there is any item under which that question can properly be taken up. I believe in previous years it was the custom of the minister to state, upon the item we are now discussing, under what item we should have an opportunity of a general discussion on marketing.


James Angus MacKinnon: I
anticipated that the hon. member for Qu'Appelle and other hon. members would have an opportunity for discussing this matter under the item relating to the board of grain commissioner's, or dealing with the Canada Grain Act.


Douglas Gooderham Ross: There are other matters besides grain to be discussed. The Minister of Fisheries (Mr. Michaud) smiles: probably fish will enter into the discussion.
There is a matter of importance which concerns not only rural Ontario but the urban population as well. The minister knows that a prohibition has been put upon the export of canned tomatoes to Great Britain. That is going to affect a great many people. Certain other items are also affected. What are the possibilities of marketing, not only canned tomatoes, but peaches? It seems to me that it is only right that the growers of these various articles should know something about their position. I have no doubt that the canners are advising the growers at the present time with respect to tomatoes. I know that has been done in some directions; but I think it should be generally known, or before long we shall have a big crop of tomatoes from Ontario and no place .to sell them. There are other problems, for instance the export of apples. We should have some general idea of the possibilities of marketing and what action the government are taking, what real efforts they are putting forward to replace the markets which we have lost and other markets which probably we shall lose.
I do not. criticize the amount of these estimates. I know the department is efficient, and possibly it might be important under conditions prevailing to-day to have a larger appropriation so that a real effort could be made to establish other markets for the things of which I have spoken. I suggest it would be well for the minister to give the committee a general idea of the policy which the government have formulated with respect to these matters at the present time.


James Angus MacKinnon: At the present moment the department is dealing not with a theory but with an actual fact, the fact of disappearing markets. Restrictions are being raised against imports from Canada in nearly all our sister dominions and in other parts of the world, and all I can say is that the department is fully aware of the situation and is taking every step possible in the meantime to urge that the restrictions be relaxed. We are doing this through our trade commissioners in the sister dominions and through the high commissioner in London as well as in other ways.


Richard Burpee Hanson: The minister is new to the department and I appreciate the circumstances under which he is -labouring. The withdrawal of these markets must be a staggering blow to the department, and a great embarrassment. Perhaps this discussion will serve as a notice to the minister that at a later date we shall expect from him a statement of policy as to what is going to be done to replace the disappearing markets.
May I advert to a matter that is nearly five years old. Prior to leaving the department I had it in mind that in the then succeeding

Supply-Trade-Administration
estimates there would be an appropriation looking to the extension of markets for potatoes from the martime provinces in South America and in Central America. Unfortunately we were defeated and the then government went out of otfice. In New Brunswick the provincial minister of agriculture is a trained agriculturist; there is no one who is more familiar with the necessity of extending our markets for the one big agricultural product of New Brunswick, namely, potatoes. I told him, in a conference which he was good enough to hold with me, exactly what I had in mind, namely, that I would ask parliament to grant the sum of S25,000 for the extension of markets for these products of the maritimes, fish and potatoes, in the southern countries, and that I felt certain that if they would make the necessary representations to the incoming minister, who was well known to me, he would cooperate with the provincial government in that regard. I even went to the trouble of dictating and signing a letter to the minister's immediate predecessor, which he was to take to Ottawa and which he could use. I assume that he used it. I never heard anything more about it afterwards, because I went away for the winter. The letter asked the government to cooperate with the provincial department with a view to extending markets for New Brunswick potatoes and fish. If I remember rightly, the minister told me subsequently that he had an interview with the then Minister of Trade and Commerce but that there was no result. That was a great pity. It was not for the benefit of New Brunswick alone; it was for the three maritime provinces; and the intention was that the government of Canada should assist the government of New Brunswick and the governments of the other maritime provinces, if they came into the scheme, in extending markets for these two staple products of the maritimes.
The government of New Brunswick went on with the scheme in a limited way. They have had a man, whom we had in the provincial government prior to 1935, visiting South America annually, and he has been a good salesman, having been instrumental in getting very substantial orders. But the whole situation has not been thoroughly surveyed, and I would ask the minister to be good enough to look into it again. Perhaps in the supplementary estimates he can do something. The Minister of Fisheries (Mr. Michaud) knows what I am talking about, and I am astonished that he has not done anything in the five years that he has been in office. I am not finding fault with him, because he has not done much about anything.


Mr. MICHAUD:: The hon. member must
have been sleeping in the last five years.


Richard Burpee Hanson: No: I
have been watching. I know he has been drawing salary, but that is about all. I am suggesting to the present Minister of Trade and Commerce that he look sympathetically into this question of extending markets for the two primary products of the maritime provinces, and that he give warm and sympathetic cooperation to the departments of agriculture in the provinces of New Brunswick, Prince Edward Island and Nova Scotia, with a view to extending our markets, particularly for seed potatoes, in the southern republics of Central America and in the West Indies-and I particularly commend the market in Cuba. I understand that the Canada-West Indies trade treaty is presently up for consideration and review. I appreciate the difficulties the minister may run into in trying to extend the market for our potatoes in Cuba, having regard to the obligations which we have incurred under the treaty in question with respect to the preference for sugar in our markets. The matter is a difficult one, but I suggest to the minister that the Cuban market for potatoes in any normal time is better than all the rest of those markets put together. I hope he will give consideration to the plea I now make for cooperation between his department and the province of New Brunswick with respect to this outlet for these two staple commodities. New Brunswick has not the money available to make any lavish expenditures in extending markets, and I think this government ought to do something about the matter. They will be entitled to all the commendation, all the laurels coming to them, if they can accomplish something in this direction.


Thomas Alexander Crerar: We are anxious to get
another department in to-night; therefore, I should like this item to stand.
Item stands.



DEPARTMENT OF PENSIONS AND NATIONAL HEALTH

[Stage Direction]
Health branch-
237. Health branch administration, $43,000.
Richard Burpee Hanson: It is
pretty late; we have had a long day and it is quite warm. I think the minister's purpose will be served if he gets in and gets right out.
Item stands.
Progress reported.
On motion of Mr. Crerar the house adjourned at 10.55 p.m.

Questions
Wednesday, June 5, 1940