VACANCY


Mr. SPEAKER:: I have the honour to inform the house that I have received a communication from several members, notifying me that the following vacancy has occurred in the representation, viz.:
Of Hon. William Daum Euler, member for the electoral district of Waterloo North, consequent upon his having been summoned to the senate.
I accordingly issued my warrant to the chief electoral officer to make out a new writ of election for the said electoral district.



EUROPEAN WAR


[Stage Direction]
On the orders of the day:
Right Hon. W. L. MACKENZIE KING (Prime Minister):: Mr. Speaker, the house will

doubtless wish to have a statement with regard to the situation in Europe in view of what has appeared thus far in the press. I do not know that I could better express the situation as it exists than to read to the house the statement which was made by the Prime Minister of the United Kingdom in the British House of Commons this morning. The text of the Prime Minister's statement was as follows:
The house will be aware that the king of the Belgians yesterday sent a plenipotentiary to the German command asking for suspension of arms on the Belgian front.
The British and French governments instructed their generals immediately to dissociate themselves from this procedure, and to persevere with the operations in which they are now engaged.
The German command agreed to the Belgian proposals and the Belgians ceased to resist the enemy's will at four o'clock this morning. I have no intention of suggesting to the house that we should attempt at this moment to pass judgment on the action of the king of the Belgians in his capacity as commander in chief of the Belgian army.
This army fought very bravely, and both suffered and inflicted heavy losses. The Belgian government has dissociated itself from the act and declared itself to be the only legal government of Belgium and formally announced its resolve to continue the war by the side of the Allies, who came to the aid of Belgium on her urgent appeal.
Whatever our feelings from facts so far known to us, we must remember that that sense of brotherhood betiveen the many peoples who have fallen into the power of the aggressor and those who still confront him will play its part in better days than those through which we are passing.
The situation of the British and French armies now engaged in a most severe struggle and beset on three sides and from the air is evidently extremely grave.
Surrender of the Belgian army in this manner adds appreciably to the grievous peril, but our troops are in good heart and fighting with the utmost discipline and tenacity. I shall, of course, abstain from comment on what, with the powerful assistance of the royal navy and the royal air force, they are doing or hope to do. I expect to make a statement to the house on the general position when the result of the intense struggle now going on can be known and measured.
This, perhaps, may not be until the beginning of next week.
Meanwhile, the house must prepare itself for hard and heavy tidings. I have only to add that nothing which can happen in this battle can in any way relieve us of our duty to defend the world cause to which we have bound our-

War-Leader oj the House
selves, nor can it destroy our confidence in our power to make our way, as on former occasions in our history, through disaster and grief to ultimate defeat of our enemy.



THE MINISTER OF JUSTICE TO ACT AS LEADER OF THE HOUSE

[Stage Direction]
On the orders of the day:
William Lyon Mackenzie King: Mr. Speaker, in view of the gravity of the situation at the moment I would ask the house if it would permit me to adopt a course which has been found necessary in Great Britain and which was found necessary in this country during the last war, namely, to delegate to one of my colleagues the responsibility of leading this House of Commons for the greater part of the time in order that in my position as Prime Minister and Secretary of State for External Affairs I may have the needed time and opportunity to give the concentrated attention, the study and thought to the many questions that are presenting themselves to the government as a whole, and to deal immediately with many situations that are becoming more pressing every moment.
My right hon. friend and colleague the Minister of Justice (Mr. Lapointe) has at different times, and for the greater part of the last session of the previous parliament, filled in my absence the position of leader of the government, and he has kindly consented to take on that task at the present session. My right hon. friend the Minister of Justice has, however, also very heavy duties at this time, as all of us have who are members of the war committee of the cabinet, and it may be that he also will be obliged to be absent from the house on occasions for a considerable period of time. In view of that possibility I have asked my colleague the Minister of Mines and Resources (Mr. Crerar) if he would take on the duty of second in command, to lead the house in the absence of the Minister of Justice and myself.
Perhaps I need not say to hon. members that no members of the government are more taxed at this present time, and likely to be more taxed in their duties during the session, (than the ministers of national defence. They are and will continue to be obliged to give considerable of their time to conferring with members of their own departments in dealing with the many critical situations with which they and all of us are faced. I hope, therefore, that it will be possible so to arrange the business of the house that measures which relate immediately to war effort can be brought on and discussed at times when it may be convenient for my colleagues the ministers of national defence or myself to be present in the house; and if by any chance their presence will be required elsewhere on short notice, that the house will understand the reasons why they also may have to absent themselves for a considerable portion of the time.
Those, I think, are the only matters upon which I wished to speak immediately. I might add that this afternoon I would like to have the opportunity of conferring almost immediately with certain of my colleagues; and in the arrangement of the business this afternoon it might be understood that some of the bills other than the one which was yesterday before the house, and which are on the order paper, would be taken up first. We could return a little later in the afternoon to the bill with respect to the appropriation for war purposes.


Hon. R. B. HANSON (Leader of the Opposition) :: I was not unprepared for the announcement which the Prime Minister (Mr. Mackenzie King) has just made. A day or two ago he intimated to me that owing to the seriousness of the situation and the consequent tax upon his time it would be almost impossible for him to give to the affairs of the House of Commons the attention which he has given in previous sessions. I can appreciate that, and I believe that all members of this house will be prepared to excuse him from attendance, except perhaps upon the most important occasions. As I have intimated more than once, we shall try to facilitate in every way the business of the house. I am sure that the Minister of Justice (Mr. Lapointe) who will be taking the place of the Prime Minister as leader of the House of Commons, is quite capable of carrying on the business of the country.
With respect to the suggestion that the two ministers of national defence may find it necessary to be absent, I can quite understand that, but I should like to say that we would not care to excuse them entirely from attendance when measures which they are promoting and in which they are vitally interested are before the house. I do not think that I can add anything further on this occasion.


William Lyon Mackenzie King: I thank my hon. friend.
War Appropriation Bill



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. M. J. COLDWELL (Rosetown-Biggar):: The Prime Minister (Mr. Mackenzie King) intimated last week that a committee might be appointed to which the government might communicate certain information. I believe *that everyone who is in the house this afternoon feels a sense of grave responsibility, and I am urging upon the government that this parliament be taken fully into its confidence and that this committee be appointed immediately so that we may be apprised of the situation, because after all the security of Canada may be involved. The Prime Minister might see fit even to arrange for a secret session of the house. There are many questions running through our minds at the present time, and we are alarmed, and we want to get certain questions answered. I was wondering whether the Prime Minister would speed up the appointment of a committee or make some other arrangement so that we may get the information which some of us would like to hear from the government.


William Lyon Mackenzie King: May I say to my hon.
friend that, when I suggested that the house might think it advisable when we came to the second reading of the bill to have its provisions referred to a committee or to a group of committees to permit of certain information being given by the different defence departments which it is obviously not wise to make public, the present situation had not developed as it has since that announcement was made. I rather gathered from what was subsequently said from the other side of the house that there was some doubt in the minds of hon. members whether that procedure would be the best to follow, that hon. members might feel that, if information was given to them secretly before one of these committees, their tongues, if not their hands, would be tied when it came to asking in public certain questions of the government. Many of the things which the government thought, at the time this parliament met, it would be inadvisable to speak of publicly at the time, have already been spoken of quite freely in the house since parliament met. I am sure that in the course of the discussion on this measure respecting war appropriation, hon. members have gained a knowledge of many situations of which formerly they were

wholly ignorant, and have obtained explanations which I hope have helped to account for what may have seemed to some of them an absence of the degree of activity which many of them, very rightly, would expect at a time like this.
One matter which has been impressed upon the government more and more is the necessity of using great care in divulging matters in advance of the time when it would be wise to make mention of them. For example, I might give this house information at the moment with respect to our expeditionary force, the Canadian active service force overseas, but if I were to give that information to-day it would be giving it to the enemy. I might answer questions with respect to the disposition of our naval forces, which answers, if given at the moment, would equally be given to the enemy. Obviously it is not desirable that matters of this kind should be disclosed, and for that reason I had thought that some such method as I have suggested, of giving to hon. members information that could not otherwise be made public, might be made in the manner I have indicated. But, as I have said, on the resolution itself, questions have been asked and answered quite freely and much information has been disclosed which the government, I thought, would not have considered disclosing at this time if matters had not developed as they have. We are now free to say some things which at an earlier stage we did not deem it wise to make known.
There is however one other reason which I regard as having at the moment an urgency which it did not have at the time I made the proposal to which I have referred. It is this, that the time of the officials of the defence forces at this moment, and probably for some little time to come, would be very seriously encroached upon if those officials were taken away from the duties in which they are engaged to come and discuss matters before a committee of the house, whether a secret committee or not. The government has therefore thought it advisable, and still considers it the right course to pursue at the moment, to allow the discussion to go on in the way it has. If ministers find that they are asked questions which it is not in the public interest for them to answer they will say so frankly and take the responsibility of refusing to give such information, just as they must take the responsibility for giving any information which they impart.
I along with my colleagues shall endeavour to see that information that is sought, if answers cannot be publicly given, is given

Conscription-Press Report
confidentially in so far as may be possible to those who have the responsibility of leading parties or groups in this house. I should like this afternoon to have a talk with my hon. friend who has just spoken (Mr. Coldwell) with regard to the present situation and some matters which I should like him to know, leaving to him the responsibility of imparting their significance to those about him in a manner he thinks would be justifiable. Equally I should like to have a talk with my hon. friend the leader of the Social Credit group (Mr. Blackmore). Yesterday I had a talk with the leader of the opposition (Mr. Hanson) and with one or two of his colleagues who are members of His Majesty's Privy Council for Canada. I had not time later in the afternoon or in the evening to see my hon. friends of the Cooperative Commonwealth Federation and Social Credit groups but I intend to do so to-day. I purpose this afternoon-in fact, that is the reason I am asking that the house should allow some of my colleagues to withdraw with me at present- to have a conference with the leader of the opposition in the senate, together with my colleague the leader of the government in that chamber, and to ask him to bring with him one or two of his colleagues who were members of the war administration of Sir Robert Borden in order that we may discuss with them the situation as it appears at the present time. If we proceed to attain the desired end in that way, in the light of information with respect to conditions as we know them, we shall be taking the course that I believe will be the wisest one to adopt in the interest of 'he country.


Richard Burpee Hanson: If I may be pardoned, I should .ike to say a word with respect to the subject natter to which the right hon. gentleman aas just alluded, namely, consideration of she question of setting up a secret committee or committees to deal with the appropriation bill. We have given a very great deal of consideration to the matter and we still have an open mind on it. I take it from the Prime Minister's remarks now that the government have come to the conclusion that no useful purpose will be served by referring the bill to such committees and that the matter will be dropped. Our view was that the Prime Minister's first proposal seemed to be just a bit inconsistent, and until the position was clarified we did not care to enter into an undertaking of that kind. Members rather took the view that they did not like to be tongue-tied or hamstrung and they would rather not serve if they could not use the information. At the moment I rather concur
in the view expressed by the Prime Minister, that perhaps the matter should not be brought up again. I should like to make our position clear. We have not actually refused to act on any such committee, but we wanted tc have certain points clarified before we agreed to do so. I do not question the Prime Minister's decision at all at the moment.



CONSCRIPTION


[Stage Direction]
On the orders of the day:
Mr. J. S. ROY (Gaspe):: Before the orders of the day are called I wish to direct a question to the Prime Minister (Mr. Mackenzie King). My question is based upon a news item published in yesterday's Le Canada, Montreal Liberal paper, wherein it is reported that the hon. member for Mercier (Mr. Jean) stated at a public banquet that Liberal members of this house, at a secret caucus of the party, have been given the assurance by the leaders of the party that conscription will not be enforced and that no national government will be formed. Is the hon. member's statement based on truth?


William Lyon Mackenzie King: Those of us who have been in parliament for some time have been accustomed to regard the proceedings of caucus as matters wholly confidential to the parties concerned. If it once became the custom to disclose what had been said at a caucus, or to deny or confirm what it is alleged to have been there stated, I am afraid that very erroneous impressions might readily get abroad. I will say to my hon. friend that proceedings of caucus are private and I intend to set an example to members of all parties by doing my utmost to keep them so.



SUBVERSIVE ACTIVITIES


[Stage Direction]
On the orders of the day:
Hon. H. A. BRUCE (Parkdale):: Before
the orders of the day are called I wish to direct a question to the Minister of Justice (Mr. Lapointe). In view of the arrest and internment in England a few days ago of Sir Oswald Mosley and his lieutenant Captain Ramsay, a member of the British House of Commons, may I ask if any steps have been taken to apprehend and deal with the leader of the fascist movement in Canada, Mr. Arcand, of Montreal, and his lieutenant, Mr. Joseph Farr, of Toronto?
Yukon Act-Fur Export


Right Hon. ERNEST LAPOINTE (Minister of Justice):: A number of papers and
documents have been seized by the police at the office of that organization and in other places. The representatives of the attorney general of the province of Quebec and the crown prosecutor are at present looking into all these papers and material with a view to taking the necessary proceedings.



ALIENS BROUGHT IN BY BATA SHOE COMPANY AT FRANKFORD, ONTARIO

Mr. G. S. WHITE (Hastings-Peterborough):: I wish to ask the Minister of Justice (Mr. Lapointe) a question with reference to the employees of the Bata Shoe Company at Frankford, Ontario, in view of the peculiar situation of this plant. It is only a matter of five miles from an airport, and it is located immediately beside very important hydroelectric plants and quite close to many large railway bridges. The question is this: Will the Minister of Justice consider the immediate reinvestigation and reexamination of all the aliens brought in by the Bata Shoe Company during the last three years?


Ernest Lapointe: The question will stand as
a notice for the consideration of both the immigration department and myself.



YUKON ACT AMENDMENT


[Stage Direction]
Hon. T. A. CRERAR (Minister of Mines and Resources) moved the second reading of Bill No. 11, to amend the Yukon Act.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Vien in the chair.
On section 1-Powers to make ordinances.
Mr. CRERAR:: There is little I can add to the observations I made on this measure when it was in the resolution stage. I might however say that so long ago as 1919 the Yukon territorial council imposed an export tax on fur taken out of the Yukon territory to other parts of Canada or to other parts of the world. Generally speaking that tax corresponded to the royalty imposed in the various provincial jurisdictions throughout Canada. It was imposed for purposes of revenue. It placed no disability upon the trapper or exporter of furs from the Yukon that was not imposed by the royalties levied in the various provinces. It is rather curious that recently the question arose as to the power of the Yukon territorial council at that time 
to impose the tax. This amendment to the Yukon Act simply makes it clear beyond any doubt that they have the power to impose such a tax, and should there be any doubt about their power in the past, what they have done in the interval since 1919 is regularized and made effective.


Richard Burpee Hanson: This seems to be an innocent and harmless bill. I am surprised that in the present circumstances the minister should take the time of parliament to bring forward such a bill, but it should not take long to pass it. According to the explanatory note and the explanation given by the minister on a previous occasion as well as to-day it would appear that there is some doubt as to the legal validity of an ordinance passed some years ago by the Yukon territorial council. He has omitted to say what the legal doubt is. I should like to know what the doubt is, what it is based upon.


Thomas Alexander Crerar: The doubt, as I understand it, is as to the legal power of the Yukon territorial council to impose such an export tax.


Mr. BLACK (Yukon):: In principle the bill is quite proper and desirable, but I do not think it should be made retroactive to May, 1919, and when we come to section 2 I propose to offer an amendment in that regard. I shall send a copy of it to the minister now. As to section 1, I think it is quite proper.


[Stage Direction]
Section agreed to.
On section 2-Coming into force. Retroactive.
George Black: I understand that this matter has arisen because of litigation now pending, or possibly a prosecution which has been attempted under the ordinance passed by the territorial council. At the bottom of this amendment I believe is the desire to bring such prosecution or litigation within the powers of the council. That may be correct as to litigation that may arise in the future, but as to the litigation now pending, I hardly think it fair for this parliament to legislate a man out of court. I suggest that this amendment be added to section 2 as subsection 2 (a):
This amendment does not affect litigation or prosecutions now pending under the ordinance passed May 20, 1919, by the Yukon territorial council, entitled " An ordinance to provide for a tax on raw furs exported from the Yukon territory" and in respect of such litigation or prosecutions section 1 of this act shall not be retroactive.
I hope the minister will not have any objection to that. It is merely to protect the people of whom I speak.

Yukon Act-Fur Export


Thomas Alexander Crerar: My hon. friend who represents the Yukon was good enough to speak to me the other day about this amendment, and mentioned then that he thought-so I understood him-that some litigation was pending. We have no record in the department of any litigation pending under this act. A communication has been addressed to the commissioner in the Yukon to which a reply has not yet been received, but the officers in charge of administration here are quite certain that if litigation had been instituted in respect of the tax imposed on any particular individual they would have had notice of it.


George Black: It may be that the information has not yet reached the department. Having very recently come from the Yukon I happen to know that such litigation is pending.


Thomas Alexander Crerar: Can my hon. friend give me any particulars of it?


George Black: It is, I believe,
an attempt to export fur from the Yukon without observing the proper formality. Only recently amendments were passed to the Yukon game ordinance whereby trappers and persons purchasing furs and persons exporting furs must have separate licences. These people I believe undertook, not at all secretly or in an attempt to evade any obligation, to ship some fur, and naturally got into trouble. This legislation should not be retroactive and thus affect them. The words that I suggest as an amendment would accomplish that purpose. Without the amendment I do not think the proposed legislation is fair. As to the general public and as to what will be done in the future in the way of exporting furs, the suggested amendment will have no effect; it is simply a matter of dealing with the particular case that is now pending.


Thomas Alexander Crerar: No one in the past has challenged or disputed the fairness of the tax. No handicap is being imposed upon anyone now in respect of paying what everyone else pays. It would be unfair to those who have paid this tax for twenty years if consideration were given to some person merely on a legal technicality. I do not think this legislation imposes any hardship upon anyone. The litigants in question, if the facts are as stated by my hon. friend, and I do not dispute them since I do not know, could pay the tax and have their furs. There is no discrimination against them; they are simply being asked to do what everyone else has done under the same conditions for twenty years.


Richard Burpee Hanson: I do not think the minister has quite caught the point of the objection of the hon. member for
Yukon. There is a principle involved. As I understand it, the litigation referred to is not ordinary civil litigation; it is a criminal or quasi-criminal prosecution. In that case the question of the constitutionality of the ordinance has been raised as a defence, if I am correctly informed, and it is a perfectly proper and legitimate defence for any accused to raise on advice of counsel. By section 2 of this bill you seek to take away the legal rights of this accused, and that is wrong in principle. The status quo would be preserved for the future by the amendment of the hon. member for Yukon, which affects only prosecutions now under way; in future prosecutions there would be no doubt about it at all, and nobody would be injured. It is a very bad thing to come into parliament and legislate a man out of court. I could use much stronger language than that. I shall not do so, but I suggest to the minister that if he were a legal man he would grasp at once the significance of what I am saying. For a legislature to pass legislation taking away from an accused person a legitimate defence savours of autocracy. I will not go so far as to say it is Hitlerism; it is not as bad as that, but I do suggest to the minister that he ought to accept the amendment. I understand that it has reference to only one case, and it will preserve that man's legal rights. After all this is a British country and we ought to preserve the principles of British justice. I suggest to the minister that to pass this section without the amendment would be a violation of -those principles.


Thomas Alexander Crerar: Would that not open the door to all those who have paid the tax in the past, to seek reimbursement?


Richard Burpee Hanson: Oh, no; that is an entirely different matter. It would not give them any rights at all.


George Black: As to the act being retroactive, the proposed amendment would not prevent that. The act would still date back to 1919 and be effective except with regard to this one prosecution in which the question has been raised. It would not be open to anyone else to take advantage of this amendment. I think it would be only fair 'to accept the amendment.


Thomas Alexander Crerar: Well, Mr. Chairman, I would suggest that we let this section stand. We have asked for a report from the commissioner of the Yukon, and before accepting the amendment I should like to satisfy myself as to all the facts in connection with it and to secure the opinion of the legal advisers of the department as to its real scope and effect.
Yukon Act-Fur Export

If that is agreeable to the committee I will move that the committee rise, report progress and ask leave to sit again.


Richard Burpee Hanson: The
motion is not debatable, but before it is put would the minister at the same time ascertain from the officers of his department just what is the occasion for this bill if it is not as the result of pending prosecutions under the ordinance? There must be something that brought it to a head. The export tax has been in effect for twenty-one years without ever being challenged, as I understand it; the question has not arisen until now. Perhaps we might have all the reasons for bringing in this -legislation at this -time. I am just suggesting that the minister might get that information.


Thomas Alexander Crerar: Yes, I can get that, but I rather suspect that these amendments have come under the eye of some student of the law who has raised the question.


Richard Burpee Hanson: They do not usually arise in that way; they arise in concrete cases.


Thomas Alexander Crerar: Not always. These acts are very often under review.
Section stands.
Progress reported.



NORTHWEST -TERRITORIES ACT JURISDICTION OF PROVINCIAL COURTS-CARE OF INSANE PERSONS

[Stage Direction]
Hon. T. A. CRERAR (Minister of Mines and Resources) moved the second reading of Bill No. 12, to amend the Northwest Territories Act.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Vien in the chair.
On section 1-Jurisdiction of provincial courts in civil matters.
Thomas Alexander Crerar: At the present time the superior courts of the provinces of Ontario, Manitoba, Saskatchewan, Alberta and British Columbia have jurisdiction, west of the eightieth meridian, over civil matters arising in the territories north of their respective boundaries. I am not in a position to inform the house why that jurisdiction was not extended or applied east of the eightieth meridian. At any rate the amendment proposed here seeks to give to the superior courts of Ontario the necessary jurisdiction in that part of the territories lying east of the eightieth meridian. That meridian, I might 
point out, runs north through Hudson bay, about two-thirds of the distance from the west coast of the bay.


Richard Burpee Hanson: Is it
approximately an extension of the Manitoba-Ontario boundary?


Thomas Alexander Crerar: No, it is somewhat east of that. In paragraph 2 it is proposed to give the courts surrogate powers to deal with estates in the territories adjacent to their respective provinces. Doubts have arisen in the minds of some of the surrogate court judges as to whether they have the power now to deal with these matters. This is particularly so in the western provinces. By way of illustration may I point out that in the northwest territories north of the province of Alberta considerable mining activities have developed, particularly along the north shore of Great Slave lake. At that point there is now a considerable population. Two small mines are operating, and in the natural course of events people will die and leave property. Their wills will have to be probated or administrators will have to be appointed. This particular section of the bill is being enacted to make clear beyond doubt that these powers exist.
Curiously enough, in the Northwest Territories Act as it stands at present, power is given to the governor in council to arrange with the lieutenant-governor of Manitoba for care of insane persons, or persons who might become insane in the territories adjacent to Manitoba. Section 2 gives power to the governor in council at Ottawa to make similar arrangements with the governments of all the provinces.


Mr. CHURCH:: Has there been any application from Ontario to take over this section east of the eightieth meridian as part of that province? I ask that in view of the expenditures made by Ontario at points very close to the boundary. Then, who asked for the bill? Did Ontario ask for it? Has Ontario asked the federal government to confer on these territories civil and surrogate jurisdiction?
Almost eveiy session during periods set aside for the discussion of private and public bills, members are asked to approve of principles and, secondly, to approve the legality of legislation. Has a law officer of the crown attached to the minister's department recommended this bill? Does the Department of Justice recommend it, and if so does it state that it comes within the British North America Act? I ask that question because the bill deals exclusively with property *and civil rights of the provinces.

Northwest Territories Act
The committee should not pass the next section of the bill. We know that sane people have been found in mental institutions, as has happened in Ontario; and the law courts have had no jurisdiction to take them out. To give the governor in council power to detain people in an institution when, in fact, those people may not be insane, is a most dangerous principle.
I should like to hear an explanation of the first point I have raised. Was the bill referred to the Minister of Justice, and has he decided whether it is within the provisions of the British North America Act? Has he decided whether parliament is at liberty to amend the Northwest Territories Act, and thereby confer additional jurisdiction outside that act? I ask that because the Northwest Territories Act has some jurisdiction in respect of property and civil rights, although the territories do not constitute a province. It may have been held in the courts that there is a lack of jurisdiction over surrogate matters, or matters connected with wills and property. In my view however the bill should have been reported on by the Department of Justice, and we should have a statement from the various provinces affected indicating whether they are asking for it or were consulted. Were the attorneys-general of the provinces affected by the measure shown a copy of it, and did they approve of it?
We have had other bills seeking to amend the Northwest Territories Act, and we know what was done with property, civil rights and education on those former occasions. On one or two occasions the privy council had to interfere, and in view of that fact we should be most careful, especially in war time, not to sanction a bill of this kind without first knowing what we are doing.


Thomas Alexander Crerar: I am not a lawyer. Sometimes I thank heaven I am not.


Richard Burpee Hanson: Oh, don't say that!


Mr. MacNICOL:: You will have a greater chance of getting into heaven.


Thomas Alexander Crerar: Consequently my opinion on the point raised by the hon. member for Broadview, whose legal knowledge I do not question, may not be very valuable. After all, however, this is simply a common-sense arrangement. To-day we have northwest territories which . are not part of any of our provinces, and are under federal administration.
There is no new principle in the bill, because already, for years past, judges in the superior courts of Ontario and the western provinces
have had jurisdiction over civil matters in that part of the northwest territories west of the eightieth meridian. This bill seeks simply to give such power in the territories east of the eightieth meridian. It seems to me there cannot be any question of contravention of the terms of the British North America Act in what is suggested in the bill with respect to the winding up of estates, the probating of wills and matters of the kind. I believe there can be no doubt that we can confer those powers on judges.
The amendments are proposed only to help administration. They have been approved and passed by the law officers of the crown, and I believe there can be no question of their validity. If some action of this kind is not taken the federal administration will probably be under the necessity of setting up its own courts in the northwest territories. Certainly at the present time that is neither necessary nor desirable.


Richard Burpee Hanson: This
measure would seem to involve an extension of the principle already indicated in the Northwest Territories Act. There must be some provision made for civil procedure in those territories, and the bill seeks to divide the jurisdiction at certain geographical points for purposes of convenience. Paragraph 2 is new, and seems to have arisen from the growth of the population in the area affected.


Thomas Alexander Crerar: It has applied to Manitoba in the past.


Richard Burpee Hanson: That fact is not indicated in the explanatory note. I can see no objection to the passing of the bill; in fact it seems to me it ought to have the endorsation of all hon. members. I would suppose the minister would be good enough to call the attention of the law officers in the Department of Justice to the academic question raised by the hon. member for Broadview. That could be done before third reading. It is a question involving constitutionality, and the law officers might give some consideration to that phase of the matter. I say that because there is some point in what the hon. member has said, but I am not so sure that it is a practical one.


Mr. GREEN:: Is there any intention of turning over any portion or portions of the northwest territories to a province?


Thomas Alexander Crerar: No, that has not been seriously considered. I believe that individuals in the provinces have written letters to the newspapers suggesting that the provincial boundary should be extended to the north pole, but, so far we have not seen any keen disposition on the part of the provinces to assume
Northwest Territories Act

the extra financial burden which would be involved in the administration of the additional territory.


Howard Charles Green: The premier of British
Columbia on different occasions has mentioned that he would like to take in the Mackenzie River basin. Have any negotiations along that line taken place? What is the present situation?


Thomas Alexander Crerar: I can say at once that no such negotiations have taken place.


[Stage Direction]
Section agreed to.
On section 2-Confinement of insane persons in provincial institutions.
Thomas Langton Church: May I ask the minister if these insane persons are to be taken completely out of the control of the law courts and their care turned over to the minister? In other words, are those who are placed in these institutions subject to any regulation or control by the law courts of the land, and do they preserve their property and civil rights in the province, or is the liberty of the subject repealed entirely by the new section 75 which appears in clause 2 of this bill? It states:
The minister may, subject to the approval of the governor in council, arrange with the lieutenant governor of any province for the removal to and confinement in any asylum . . . of any insane person. . . .
As I pointed out a moment ago, in Ontario *the grand jury found that one person who had been confined in a mental institution was sane. As I read this section the minister is removing the law courts from control over these people and taking power to confine them, subject to the approval of the governor in council.


Thomas Alexander Crerar: I think the hon. member is wholly mistaken. This legislation takes away no civil rights from anybody. All it does in effect is this: If to-morrow an individual in the Yellow Knife area north of Great Slave lake requires care in an institution we want power to arrange with Alberta to put him in an institution in which he can get proper treatment. None of his civil rights is taken away or interfered with. We have this right to-day in the territory adjacent to Manitoba and we simply seek to secure the same right in the territory adjacent to the other provinces.


George Black: May I ask who is meant by "commissioner" in the new. section 75, which provides that an insane person may be kept in custody until the pleasure of the commissioner is known? Is it the commissioner of the northwest territories?


Thomas Alexander Crerar: Yes.
,


George Black: Who is the commissioner of the northwest territories?


Thomas Alexander Crerar: Doctor Camsell, at the present time.


Mr. BLACKMORE:: As the act now stands the minister is empowered to " make such arrangements with the lieutenant governor of Manitoba as seem reasonable as to the compensation to be made by Canada to that province." I am wondering why that expression is not included in the new section 75 which is being substituted for the old section. It looks as though the minister is to be allowed a certain amount of dictatorial power.


Thomas Alexander Crerar: No. It provides for making arrangements. We have to arrange for the placing of these individuals in appropriate institutions. We could not, for instance, take some person from Great Bear lake down to Edmonton and hold a pistol at Mr. Aberhart's head and say: You have to put this fellow in the asylum. No, we have to arrange the matter with him, and I hope that if the occasion should ever arise we shall be able to make a favourable arrangement with the premier.


John Horne Blackmore: I was just wondering why the same expression was not used in the new section.


[Stage Direction]
Section agreed to.
Bill reported.
Mr. CRERAR moved the third reading of the bill.
Richard Burpee Hanson: I should be quite agreeable to taking the third reading now but the hon. member for Broadview (Mr. Church) has raised a legal question and therefore it would not do any harm for the third reading to wait until the next sitting.
Motion stands.



DAIRY INDUSTRY ACT


[Stage Direction]
Hon. J. G. GARDINER (Minister of Agriculture) moved the second reading of Bill No. 13, to amend the Dairy Industry Act.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Yien in the chair.
On section 1-Cheese.
Mr. SENN:: Would the minister give us a general idea of what the bill purports to do and whence came the demand for this change? I was not aware that there was any great

Canada Grain Act
amount of processed cheese made in Canada, or even imported, unless put up in packages as outlined in the first part of this clause.


Mr. GARDINER:: The explanation which I made on the first reading was probably open to some misinterpretation. In accordance with the provisions of section 8, subsection 2, of the Dairy Industry Act, it is illegal to cut from processed cheese packed in bulk portions of indiscriminate weight for sale to customers. That is, if anyone has a package of more than a pound, a half-pound, a quarter-pound, and so on, it is illegal to cut it on the counter and sell it to the customer.


Richard Burpee Hanson: Just why is that?


James Garfield Gardiner: The existing legislation has not been enforced for the reason thait a very important part of the trade in processed cheese consists of selling portions cut from packages having an initial weight of five pounds. The old way of selling cheese in stores was to cut a slice, weigh it, and hand it to the customer. Nowadays processed cheese is usually put up in small boxes or packages, but there has grown up a practice of putting it up in five-pound loaves or bricks, and when persons come in who do not want five pounds, the merchant cuts from the five pound loaf. Under the law as it is to-day that practice is not legal, but it is thought to be a legitimate trade in that type of cheese which could be very properly controlled, and this bill simply provides that in future it will be legal to cut from loaves provided they are of not less than five pounds weight.


Mark Cecil Senn: Why is the weight limited to five pounds? Why not three pounds? Is there no demand for the smaller size of package, or what is the reason?


James Garfield Gardiner: I understand the customary loaf or brick is a five-pound loaf or brick. It is not thought wise to reduce it to a lower amount if the present weight meets the conditions of the trade as now carried on.


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


[Stage Direction]
Hon. JAMES A. MacICINNON (Minister of Trade and Commerce) moved the second reading of Bill No. 7, to amend the Canada Grain Act.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Vien in the chair.
On section 1-Binning of tough with straight grades as a means of drying.
Mr. PERLEY:: The minister will recall that last year there was quite a long discussion and consideration in committee having to do with the general revision of the Canada Grain Act and the question of the drying and mixing of grain. Drying through such a process as is outlined here was considered at some length. Would the minister inform us whence came the demand for this provision, that is, allowing tough grain to be mixed with straight or dry grain for drying purposes?


The CHAIRMAN:: I think that the question arises under section 2 rather than section 1.


Mr. MacKINNON (Edmonton West):: The purpose of the bill is simply to correct three inaccuracies in the wording of the amending act.


Richard Burpee Hanson: In the numbering.


James Angus MacKinnon: The section with which we are now dealing relates merely to the correction of the numbering of paragraphs. I can go fully into the matter if the hon. member wishes.


Ernest Edward Perley: The minister might give us some information as to the effect of the amendment he made last year in this respect, as they related to the marketing of the crop last year. Probably the Minister of Agriculture will recall that provision was made for a certain amount of mixing so long as it did not interfere with the ultimate grading of the grain as it was weighed out or shipped out of the terminal elevator for export. What was the effect of the amendment last year?


Thomas Vien: This section is only for the purpose of correcting the numbering. At present there are three subsections, and the purport of the present section is to make subsections 3, 4 and 5 read 4, 5 and 6. Therefore the question is out of order under section 1. Shall section 1 carry?


[Stage Direction]
Section agreed to.
Sections 2 to 4 inclusive agreed to.
Bill reported, read the third time and passed.
Seeds Act


[Stage Direction]
Hon. J. G. GARDINER (Minister of Agriculture) moved that the house go into committee to consider the following resolution:
That it is expedient to bring in a measure to amend the Seeds Act, 1937, to empower the minister to prescribe fees for seed control services.
Motion agreed to and the house went into committee, Mr. Vien in the chair.
Mr. DOUGLAS (Weyburn):: Will the minister explain the resolution?


James Garfield Gardiner: We test in our laboratories approximately 100,000 samples of seeds each year. The tests are made in large part for the purpose of selling seeds under grade certificates as required by the Seeds Act. Those having seeds require them to be tested for selling purposes and they are given a certificate showing that the seed is of a certain type. The practice has grown up of having seed tested for all kinds of purposes, and these tests could very easily be made at home. There is no difficulty about making them. Instructions can always be obtained free of charge as to how to make tests and how to consider them. It is proposed to charge a small fee for tests in order to stop a practice which has grown up which takes up a great deal of time and causes a great deal of expense in this branch of the department in carrying out tests which are not absolutely necessary. In addition to that it is intended to charge enough to cover at least a part of the cost of giving the service to those who have considerable quantities of grain to sell. The fee will be a very small one.


Richard Burpee Hanson: Is there
any authority at the present time to charge such a fee?


James Garfield Gardiner: No.


Richard Burpee Hanson: The object is to legalize the charge?


James Garfield Gardiner: Yes.


Mark Cecil Senn: I notice in the report of the
Minister of Agriculture for the year ended March 31, 1939, a statement at page 106 that under the Seeds Act and regulations revenues amounting to S37.744 were collected for the fiscal year. What were these services for? Were they for regular inspection, when perhaps a conviction was going to be registered?


James Garfield Gardiner: I am not prepared to
say at the moment, but when the estimates are
[The Chairman.]
under consideration I will discuss the item. There is no power under the act to charge the fees proposed here.
Resolution reported, read the second time and concurred in. Mr. Gardiner thereupon moved for leave to introduce Bill No. 19, to amend the Seeds Act, 1937.
Motion agreed to and bill read the first time.



WHEAT COOPERATIVE MARKETING


[Stage Direction]
Hon. J. G. GARDINER (Minister of Agriculture) moved that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to amend The Wheat Cooperative Marketing Act, 1939, to provide for the calculation of initial payments paid to selling agencies, and also to grant authority for payment of liabilities of the minister under any agreement and of administrative expenses.
Motion agreed to and the house went into committee, Mr. Vien in the chair.
Mr. QUELCH:: Will the minister explain?


James Garfield Gardiner: The first important
change is simply an enlargement of the definition of primary producer. At present primary producer means any person who is engaged in the production of wheat and it is intended to widen that definition to provide that "producer" shall be deemed to include any person entitled, as landlord, vendor, mortgagor or otherwise, or by contract or operation of law, to wheat grown by the producer, or any share therein. It makes provision whereby under a crop agreement a person entitled to a third of the crop may deliver under the act as well as a person entitled to two-thirds. The next section provides for the correction of an inaccuracy in connection with the wording in the definition of selling agency. Another section merely provides for wording to clarify the meaning of the section in the original act, and the remaining provisions are to make it possible for the minister to make any payment which may be necessary as a result of the operation of the act. The act now provides that if under the agreement entered into between the department and the selling agency the wheat is not sold for the full value of the advance, then the minister may pay the difference between the amount for which the wheat was sold and the amount of the advance. But there was no provision in the act giving authority to the minister to make the payment

Wheat Cooperative Marketing
and this section provides that authority. It also enables the minister to make payments on administrative costs.


Ernest Edward Perley: The minister might at this stage give us more information with respect to this proposal. Speaking generally on the measure, not exactly to the amendment, I might say that last year I opposed a similar bill, from the standpoint that I did not think it necessary, that it did not serve any useful purpose and was intended-I think the term I then used was to succour the grain trade or salvage some of those who needed help and under present conditions I think the same observations would apply. The minister might tell us how the act worked last year, how many cooperatives were set up, the number of elevators and firms that went in, and what happened to many of the small independent dealers or operators in the trade. We might also have figures with respect to the amount of wheat marketed through the cooperatives. It is important that we should have a statement as to the losses sustained in their operations and what amount the government will have to pay to make up that loss, the difference between the guaranteed price of sixty cents-was it?


James Garfield Gardiner: Fifty-six cents.


Ernest Edward Perley: -and the price at which
they sold the wheat. I should think there would not be a very great loss because it was during only a very short time in the marketing season that wheat was below fifty-six cents. That also might be stated-for how long a period was the open market price below the guaranteed price? We should also have a statement as to the effect of the competitive selling by these cooperatives of wheat against the other organizations handling board wheat, for instance. Did any direct benefit accrue to the producers generally from this legislation?
The Turgeon. report distinctly recommended that the wheat board should be kept intact ready to operate, certainly in case of an emergency or crisis; and, I believe on the same page of the report, it stated that open market or exchange could not function in the case of an emergency. Surely we have an emergency now. From the information given yesterday by the Minister of Trade and Commerce it would appear that the wheat board will be called upon this year more than ever before to operate, especially if the grain exchange is closed.
As I see it, this proposed legislation more or less continues the competition. It is not necessary; no doubt the board will handle practically all the grain. Further we have the
three western pools, one in each province, thoroughly organized to carry on the work that these cooperative organizations or groups will do. I think we should have from the minister a general statement as to the operations of these cooperatives in the last marketing season, what the loss will be, the number of bushels handled and the amount of wheat sold below the guaranteed price of fifty-six cents.


James Garfield Gardiner: I think I may say that most of the grain trade-I would be inclined to say all of it, though it is just possible that there may be a few exceptions of very small companies-has been organized under this legislation. There are nine different central selling agencies set up. There is the Grain Growers Export Company Limited, Winnipeg, which is the selling agency of the United Grain Growers; the selling agency of the Saskatchewan Cooperative Wheat Producers Limited, known as Saskatchewan Pool Elevators Limited, and there is the Alberta Pool Elevators Limited of Calgary, set up under the Alberta wheat pool. Then there are some seventeen elevator companies that have one common selling agency, the Grain Sales Agency of Winnipeg. The Searle Grain Company have their own selling agency. There is Midland Pacific Terminal Limited of Vancouver, British Columbia, which represents the Midland Pacific Grain Company, the Peace River Milling Company and the Northern Grain Company, and there is the Saskatchewan Pool Elevators Limited of Regina for the cooperative elevator associations of the Manitoba pool. They are handling the Manitoba pool wheat. Then there is the Prairie Grain Sales Limited, of Edmonton, representing the Gillespie Grain Company, the Ellison Milling Company and James Richardson and Son; and the Victoria Trading Agency Limited of Winnipeg, representing the Robin Hood Flour Mills, N. M. Paterson, Scottish Cooperative Wholesale Society, Western Canada Flour Mills Company Limited; McCabe Brothers Grain Company, Lake of the Woods Milling Company Limited, Ogilvie Flour Mills and Robin Hood Flour Mills Limited. All these have organizations set up under the act.
The information with regard to marketings by the different companies is given to us confidentially, and I think it would not be proper for me to give that information to the committee. I can only say that something over three million bushels was marketed during last season and up to the present under these different organizations.
Regarding the possible losses on the operations to date-
2S2
Wheat Cooperative Marketing


Mark Cecil Senn: Before the minister proceeds, was any part of the three million bushels he just spoke of Ontario winter wheat?


James Garfield Gardiner: Not to my knowledge, although I would not like to say definitely that none of it was.
I was about to say that all these organizations made an initial payment of fifty-six cents a bushel on wheat which they took in under the act. The act provides that they may not pay more than sixty cents a bushel advance. In setting up their organizations to take delivery of grain from farmers during this year they found it necessary to provide for an average of about four cents a bushel for cost of carrying grain for the period that it has to be carried, so that they said the only price at which they would be safe would be about fifty-six cents. We agreed with that position, and the fifty-six cents per bushel advance was made. Some time ago, I have not the date at the moment, most of these organizations, I think all of them that had wheat, applied for permission to make an additional interim payment of fourteen cents. This additional payment has been made by some of them, if not all. So that the advance which has been paid on that wheat up to date is seventy cents a bushel, or the same advance that has been made to the wheat growers on all the wheat taken in by the Canadian wheat board. The statements that were presented to the government at that time showed that on the wheat which had been pooled until the recent pegging of the price the government was not likely to take any loss. As a matter of fact the wheat had been disposed of at a price which enabled these pools to pay their advance without much possibility of the government having to take a loss. At the present time, so far as I know-it cannot be stated definitely and finally, of course, until the end of the crop year on July 31 next-it is not thought that there will be any loss on the wheat which has been marketed under this legislation.


Ernest Edward Perley: What was the exact number of pools or cooperatives set up?


James Garfield Gardiner: Nine, I think.


Ernest Edward Perley: The statement we have
just heard from the minister is a positive admission that there is no need for this measure at all. Nine pooling agencies, including most of the elevator firms and many members of the grain exchange, handled only
3,000,000 bushels out of a crop of 375,000,000 bushels. I think we will require something more substantial from the minister to justify the government coming to the rescue, so to speak, by guaranteeing *hese companies in

this way in competition with the board and the regular pools of the west. These pools under this legislation paid an advance of 56 cents and then made an interim payment of 14 cents, equal to the total payment under the wheat board act of 70 cents. It resolves itself into this: they have made practically the same payment as was made under the wheat board, except that they did not make the entire payment at once. This interim payment was held up; these pools had the use of that money for a certain length of time, and I think they should be required to account for it.
It seems to me the minister's statement is a definite admission -that no useful purpose is being served by this measure, and I think he should move that it be repealed. Allow these people to wind up their affairs with respect to the handling of the 1939 crop; then repeal .this measure and continue under the system we had previously.


Thomas Clement (Tommy) Douglas: If I remember correctly, on April 5 of last year, when the Minister of Agriculture was introducing his bills regarding the marketing of wheat, he stated that he was carrying on something in the nature of an experiment; that is, that there were three ways in which wheat could be marketed under the legislation he was setting up. First there was the open market; second, there were the facilities set up under this bill, by which a farmer might sell to a pool or association; and, third, there was the wheat board, to which the farmer might sell his wheat and secure a minimum advance price.
I agree with the hon. member who has just taken his seat that even on the basis of the experiment it would seem pretty plain now that the contention we made at that time has been justified by what has occurred; in other words, that the best way to handle the marketing of wheat is through a wheat board giving the farmer a guaranteed minimum advance price commensurate with the cost of production. But something has happened since that time. Since then war has broken out, and the best proof that war is no time for experiment with different marketing policies is the fact that just a few days ago the government itself had to intervene and peg the price in order to prevent a very serious collapse in the marketing of wheat.
In view of the fact that it would involve another of his colleagues as well as the policy of the government I do not suppose the minister can make any statement now, but I wonder if he would take under advisement and press upon the government the need for a wheat policy based on the fact that this

Wheat Cooperative Marketing
country is at war and that speculating in food products in time of war can lead to nothing but instability. I believe the government should very seriously consider the closing of the Winnipeg grain exchange, at least for the duration of the war, and the marketing of our wheat through the Canadian wheat board, dispensing with the facilities under this act and with the open market while Canada is at war. It seems to me that is the only way we can hope to have anything resembling a stable agricultural life in this dominion. If at the present moment we are straining every nerve to mobilize our industrial reserve it would seem very unwise to allow the marketing of wheat to be carried on under what the minister himself said was really an experiment. Within a very few days or weeks the government ought to bring down in this house a definite policy for the marketing not only of wheat but of all agricultural products.


Victor Quelch: I find myself wholly in accord with the hon. member for Weybum (Mr. Douglas). When this bill was up for consideration last year I stated that in my opinion the correct way to market our crop was through the wheat board; and I think the majority of the farmers of western Canada are in agreement with that idea. If that is sound in time of peace it is even more sound in time of war. Not only should we have a wheat board; in my opinion it should be a one hundred per cent compulsory wheat board, which would market all our wheat. I think we have a very undesirable state of affairs at the present time, in that we have a number of organizations selling wheat apparently to only one man in England. Certainly that must be to his advantage and to our disadvantage. I know if I were buying horses I would much prefer to buy them from a number of people rather than from one man who might hold me up for any price. Naturally the man in England is at an advantage when he is able to buy wheat from a number of organizations instead of from a central selling agency such as the wheat board.
So far as any changes in the measure go, apparently they will make no difference in the price of wheat. I think if any change is to be made at all it should be made in the method of calculating the initial price; and the only fair method would be to take into consideration the actual physical cost of producing that wheat so that the farmers might receive a price commensurate with the prices of other commodities. Especially is that so when we have a government which says, as this government said last September, that it will insist upon equality of sacrifice during the war. There can be no equality when the farmers
have to sell wheat for less than the cost of production while on the other hand they are paying gradually rising prices for the things they have to buy. That is indicated veiy clearly in the last issue of the Searle index, from which I should like to read a few words:
The Searle index of the price of " Things Farmers Buy" (147 items) now stands at 135, 1913-14 equals 100, which means that these things cost farmers in the west, at the present time, 35 per cent more than they did in 1914 before that Great War. The price of wheat- No. 1 Northern-as of April 23rd, basis the open market price, is now 24 per cent lower than it was in 1913-14. This means therefore that a bushel of wheat in western Canada now has a purchasing power in relation to " The Things Farmers Buy " of 56 per cent in comparison with the purchasing power of 100 that it had before the war.
Certainly it does not look as though things were getting any better; as a matter of fact they may get a great deal worse. Therefore I think the farmers have every right to request that the government take immediate steps to institute a one hundred per cent wheat board and guarantee a price that has some relation to the prices of other commodities at this time.


Thomas Langton Church: In view of the war, in my opinion the resolution should be referred to the committee on agriculture. It is of tremendous importance to the people of Canada that this great basic industry, the grain-growing industry, one which the minister understands, be placed on a sound basis. It was urged for many years that free trade should be practised, and that the grain trade was a north and south industry, and not an east and west one to the markets of the world. To-day, however, we have to face the fact that we are at war, and that to a great extent markets have vanished owing to war problems, transportation difficulties and the submarine menace.
To-day we are faced with a grave situation, and we must consider the ability of the country to pay all these bonuses, subventions or subsidies such as the minister and the Liberal party have contended for years were, under free trade, unnecessary. In many respects the principle behind the Wheat Cooperative Marketing Act is satisfactory in times of peace and plenty, but it must be remembered that to-day we are faced with a world war which has brought with it losses of markets all along the line for everything in trade and commerce and industry. In addition to that we are confronted with transportation difficulties, and the dangers consequent upon enemy submarines. We do not know what the cost of the operation of legislation founded upon the resolution will be,

Wheat Cooperative Marketing
and in my view the Minister of Finance should report to the committee on agriculture respecting that phase of the matter.
We find in the resolution provision for the calculation of initial payments paid to selling agencies, and provision for granting authority for payment of liabilities of the minister under any agreement and of administrative expenses. No one can calculate what those provisions and calculations may or will cost Canada. Last year we spent almost six weeks in discussing agriculture; it was virtually a Saskatchewan session. At that time, early in 1939, the minister said, as is indicated in the copy of Hansard which I have before me, that the government was going to get out of the grain and market industry; that .it was going to stop subventions and bonuses, and that it would go back to the old principle. That was not done. Later the government recommended the passage of the Wheat Cooperative Marketing Act, 1939, and other measures providing additional bonuses, stabilization funds, subventions and subsidies to the grain-growing industry.
What is the minister doing about the orderly marketing, if possible in time of war, of north American wheat? Has he had any conferences with Henry A. Wallace, Secretary of Agriculture of the United States, regarding the orderly marketing of wheat by Canada and the United States under war conditions? Then, is the government going to consider the preference afforded under the Canada-United States treaty, which as I understand will terminate some time in June? Is it the intention of the government to continue the operation of that treaty?
Under the Ottawa agreements Canadian grains enjoyed a six-cent preference when carried on Canadian or British ships to Great Britain, a preference since also given to the United States. In view of the war is it the intention of the government to continue the treaty with the United States for another three-year period? I believe we should have some report as to what a measure founded on this resolution would cost, because in the present circumstances we are asked to consider calculations that in the end may be just a gamble. Wheat may sell at forty cents, fifty cents or sixty cents; no one can tell what the price may be during the war months of this year yet to come. In this year the war, alone, will cost the country, before we are through, almost a billion dollars, and I say we should not pay the losses just in the marketing of the products of one basic industry at the expense of loss of markets in all others.
I do not want hon. members to think that I object to this industry, getting substantial aid as in the past, or to according it a good measure of protection. I have been a consistent protectionist friend of the grain industry since I came here, although I have not acted the way some hon. members in the prairie provinces have acted. I have been a consistent protectionist for the grain-growing industiy of Canada, and ever since I entered the House of Commons I have supported advanced protection for that industry. We were told years ago by free-traders in the prairie provinces that the United States was our logical market. They were opposed to any form of protection, and were in favour of complete free trade. However, after that they came along and supported bonuses, subventions, subsidies and stabilization funds of all kinds, and since then we have had all kinds of bonuses, subventions and subsidies for this one industry.
The grain-growing industry is not the only one in Canada which has lost its markets. What industry has not, as a result of this awful war? If we are beaten in the war, everything is gone; industry generally will be ruined and will lose markets. The industrial workers in our cities and towns in the east will lose their work, and many have. Were it not for the British fleet we would be blackened out. We must yet face the war submarine menace and loss of markets, a very serious thing so far as trade is concerned.
In my view Nos. 26 and 27 on the order paper referring to the Wheat Cooperative Marketing Act, 1939, and the Agricultural Products Cooperative Marketing Act, 1939, respectively, should be referred to the agriculture committee. We have many calculations, ail of which may be out in fact and only a guess. The committee should have the power to go into the whole question, and it should have the advantage of hearing the Minister of Agriculture and the Minister of Finance, who is responsible for the tax-rate in the country. How he is going to raise all the money required, I do not know. Industrial workers can pay no more of these bonuses, subventions and subsidies; they are not content to pay bonuses to some and not to others. There should be equality of treatment. I am for protection for all the people, all the time, and not just for some of them. I do not know on what foundation the calculations respecting this resolution are based, and I believe the committee on agriculture should have the advantage of all details, and make their report accordingly.

Wheat Cooperative Marketing


Mr. FAIR:: I only wish the hon. member who has just taken his seat would go out west and work on a prairie farm for as long as he has attended in the House of Commons. If he did that, he would be in a position to come back and educate those of his friends who are taking the same stand as he has just taken, namely, that industry is bearing all the taxes and all the load.
In contrast to what the hon. member has said, may I point out that the taxes paid by industry are unloaded on to the shoulders of the producers and the consumers, particularly those in western Canada. On different occasions I have given figures showing where the markets of eastern Canada are to be found. On different occasions we have heard hon. members, particularly those of his majesty's loyal opposition, supporting higher tariffs, and from those hon. members we have heard strong objection to any help being given to the wheat producers in the west. Perhaps they will remember that for the only year concerning which we have information respecting tariffs, every man, woman and child in Alberta paid $26.93 to satisfy tariff impositions.
If we were to get back that amount, by way of payments on our wheat crop, we would not need to come to Ottawa to fight our battle each year, as we have been doing in the past. Perhaps hon. members will realize that in the past ten years farmers have not been receiving much more than fifty per cent of the average cost of growing their wheat, and yet we are expected to continue to be patriotic-not in a profitable way-and to supply Canada and other countries as well. Countries across the ocean are being subsidized in the production of their wheat, and yet we have to come here and listen to speeches such as the one just delivered by the hon. member for Broadview (Mr. Church).
Yesterday the Minister of Agriculture (Mr. Gardiner) told us that supplies of farm products on May 1 were greater than on the same date in 1938 or 1939. But this is no indication that these products were produced at a profit. Last year he told us that if a man gets over twenty bushels of wheat to the acre, he can produce it at from thirty cents to forty cents a bushel. With that statement I do not agree, either. Hon. members in this corner of the house have produced figures proving definitely that over a period of years wheat cannot be raised for less than ninety-five cents a bushel at the farm. I believe that fact is borne out if we look up the operation of the Farmers' Creditors Arrangement Act, a
measure made necessary through debts piled up because of poor prices received by the producers.
I believe the amendment now being sought is about as necessaiy as a second tail for a horse or a cow; there is absolutely no need for it. We have on the statute books other legislation which, if properly used, would remove the necessity for the measure suggested. I refer to the Canadian Wheat Board Act and the Prairie Farm Assistance Act. If those measures are used as they should be, and as it was intended they should be, the amendment now before us could be scrapped.
I would suggest consideration by the government of the permanent closing of the Winnipeg grain exchange. After war started, the grain exchange in England was closed. Passing through Winnipeg a few weeks ago, I had a look round the exchange for the first time. One of the officials pointed out to me and to others with me the benefits being derived by farmers from the operation of the exchange. He told us we could not get along without it, and so forth. I asked him if the grain exchange was operating in England. He said, "I do not think it is just now." I told him that it was closed because the government of the old country found it necessary to close it, and I believe the grain exchange in Canada should be closed and left closed. I believe the wheat board should be used and a decent price based on cost of production guaranteed to the farmers.


Mr. DOUGLAS ( Weybum):: What is the estimate of the selling price of these selling agencies which are disposing of the wheat or have disposed of it?


James Garfield Gardiner: All I can say at the moment is that the sale price has been more than sufficient up to date to pay the 70 cents; that is, after paying the carrying charges, the 4 cents we are allowed for that. I do not think it would be proper for me to go further even if I had the information here because it would be dealing with business information of_ these companies which still hold some of this wheat.
In reply to some of the points that have been raised, I would say that this legislation makes provision for carrying on for this year. It is most necessary that this legislation should be on the statute books to make provision for carrying out this year what we provided for last year. If this amending legislation were not passed and there happened to be a loss-at the moment we do not think there will be-we would not be in a position to make payment to the different concerns which have
2S6

Wheat Cooperative Marketing
taken delivery of this wheat from the farmers. That covers the first point raised, that the legislation should be dropped altogether.
So far as this amending legislation is concerned, it is necessary that we should have it on the statute books so that it will operate in connection with over 3,000,000 bushels of wheat this year, in order that w'e may be able to make effective use of its provisions in finally disposing of that quantity of wheat.
On the question whether it would be wise under war conditions to have the legislation on the statute books at all, I would point out that if what has been suggested were to take place, namely, if it became advisable for the government of Canada to take control of all the wheat of Canada and deal directly with the British government, then not only this legislation but all the other acts having to do with the handling of our wheat as they now stand on the statute books would simply have to stand by until the end of the war. There would be no possibility of continuing to handle wheat under the provisions of legislation, for instance, for the proper operation of the grain exchange, or under the provisions of the wheat board act as we now know it, or under this or any other legislation relating to grain which was passed before the war started, so I do not think anyone needs to worry about what would happen in the event of our having to take the action which has been proposed from the other side of the house. On the question whether we should take such action I am not in a position to say anything at the moment. As was suggested by one hon. member who spoke, it is a matter for the consideration of the government, and any final announcement of policy would be for the leader of the government or the Minister of Trade and Commerce, under whom -the wheat board is operating.
I would suggest, therefore, that in passing this amending legislation we are providing to make the present legislation operative to take care of the wTheat which has been delivered under the act.
One further point. It has been suggested that the act has served no good purpose. Well, the greater part of the wheat which has been handled under this act has been handled by the Saskatchewan pool. They were the first to ask to have the act brought into operation. Most of the wheat which has been delivered under the act to anyone has been delivered to the Saskatchewan pool, and I think the experience gained already in the handling of even
3,000,000 bushels is sufficient to have warranted the act's being brought into effect this year, if for no other reason than that it 'has made it possible for at least a small group delivering
[Mr. Gardiner.l
grain under it to determine what they think of a measure of this kind as a future method of marketing grain. We are not always going -to be at war. We are going to get back to normal conditions some time, and I do not think the experience that we shall have had under this legislation will prove otherwise than beneficial to the western farmers.
I therefore suggest that the resolution be allowed to pass so that the bill may be presented to the house for consideration and the necessary amendments made in order to carry out the terms of the act.


Ernest Edward Perley: The minister has just stated that the Saskatchewan pool handled the great bulk of this wheat. He will recall that when the western committee was down here last year, the Saskatchewan pool was represented on it, and its representatives opposed the passing of the bill of last year. They presented an argument, in their second submission I think, opposing the act.
There was a reason for the pool coming in on it. Not only had they their pool operations, but they are now doing a business similar to that of other grain firms, and naturally they would come in to accommodate certain of their customers -who were not putting their grain through their pool; that is, they conducted open market operations just like other companies are doing. I think that is the reason why the Saskatchewan pool came in.
Again, if they handled the great bulk of the
3,000,000 bushels, that is another reason why the bill is not necessary. The minister has not yet stated w-hat was the effect, from a competitive point of view, of the selling of the grain by these cooperative organizations. I -grant that it could not have been a very large amount and that the pools handle most of the wheat. The minister has not yet stated what the exact loss is. He said that it was more or less confidential.


James Garfield Gardiner: There is no loss yet.


Ernest Edward Perley: That is fine. Then there is hardly -any necessity for this amendment. In reply -to the minister's argument, I would say that section 4 of the bill of last year gives the .minister almost unlimited power to prescribe regulations to deal with various matters and to make almost any kind of agreement with -the cooperatives. If there is no loss, I think the minister already has sufficient power under section 4 of last year's legislation to wind up the business of the cooperatives.


James Garfield Gardiner: I am very sorry that neither myself as minister nor the member for Qu'Appelle (Mr. Perley) can determine the question as to just what legal powers I have.

Supply
The Department of Justice informs me that under the legislation as it is now drafted, if we did have a loss, I have not the authority to pay what the act provides shall be paid, and the department says that .this amendment is necessary to give me the power to pay what the act provides shall be paid. If there is no loss, there will be nothing to pay. Up to date there has been no loss. But if there is a loss, then this legislation simply gives me the power to pay what other provisions of the legislation say ought to be paid and require to be paid.


Ernest Edward Perley: I would ask the minister to use some of the powers delegated to him in one or two of these bills. At least he might try to do so. In certain bills passed last year, wide powers were given, and I suggest that the minister try out some of those given him in this particular bill.


James Garfield Gardiner: All I can say in reply to that is that I found out on quite a number of occasions that the powers given me in a bill were not nearly so wide as some hon. members had said they were.


Major James William Coldwell: I should like to emphasize the point made by the hon. member for Qu'Appelle. In my travels through Saskatchewan I have found that people connected with the pools, although they may be using this particular act, are not in favour of it because they believe that it is a misnomer to call it a cooperative marketing act. I realize that this measure must go through, but I think the government might be wise to consider the suggestions that have been made from this part of the house that during the war period, at least, all grain marketing be placed under a single board and a price guaranteed to the producer which will give him an adequate return for his labour. After all, we may find in the course of the next few months or a year that food means the winning or the losing of the war.
While I am on my feet let me say that, if we had approximately 450,000,000 bushels of wheat this past year, and 3,000,000 bushels have passed through these particular channels, only about two-thirds of one per cent of the wheat has been marketed in this way. I do not think the experiment has been satisfactory. I do not believe we should continue to operate under this particular measure, to which, although they use it, the people who are handling grain in western Canada are not favourably disposed. I repeat that I just wish to emphasize the point which has been made by the hon. member for Qu'Appelle.


James Lester Douglas: I wanted to ask the minister a question which does not relate directly to this resolution, but will come up later. Was the grain futures bill which was passed last year, providing for the supervision of the Winnipeg grain exchange, ever proclaimed to become law?


James Garfield Gardiner: That act is under the Minister of Trade and Commerce. I do not think it was proclaimed.


Thomas Langton Church: As regards this mythical "bonus" which the industrial provinces get, I never heard of it until three years ago some professor started the idea and it was referred to in this house by some hon. members at that time. As a matter of fact, it does not exist except in the minds of some professors and some free traders on the prairies, and with the war, it has gone forever.
Resolution reported, read the second time and concurred in. Mr. Gardiner thereupon moved for leave to introduce Bill No. 20, to amend the Wheat Cooperative Marketing Act, 1939.
Motion agreed to and bill read the first time. SUPPLY
Hon. J. L. RALSTON (Minister of Finance) moved that the house go into committee of supply.
He said:	The house will understand that
a portion of the fiscal year has gone, and it is necessary that interim supply be granted in order to cany on the public services.
The interim supply which I propose to ask for is one-sixth, that is two months' interim supply for all items in the estimates which have been tabled; that is, all items which are to be voted. Hon. members will understand that there are a large number of items which are covered by statutory provision and therefore do not have to be voted by special estimate. I am asking for two months' supply for all items; another and additional month's supply for certain items listed in the schedule to the bill which I propose to introduce founded upon the resolution-hon. members will see, when the bill is in committee, just what these services are-then, another two months' supply for a certain other set of items, which means four months' supply in all for that last class; and another four months' supply for the last set of items, which means a six months' vote, or one-half year, for a special set of items contained in the fourth resolution.
We are asking for two months' supply in connection with all items, for three months' supply in connection with some of the items,
Interim Supply Bill

for four months' supply in connection with some others, and for six months' supply in connection with certain others.


Richard Burpee Hanson: The minister was good enough to
mention this matter to me yesterday. My understanding was that the amount to be voted was one-sixth of the total; and of course, as the fiscal year begins on April 1, it will be readily understood by anybody that two months' supply must be made immediately available or the government services cannot go on. To that provision, of course, there could not be the slightest objection. It has often been done before, under all governments, as far as I know, and there is no objection from this side of the house. But I am wondering whether I should ask at this stage with respect to resolution No. 2, which calls for another one-twelfth in addition to the one-sixth provided by No. 1, for certain items for whose meaning we have been asked to look at the estimates; and for an additional two^ twelfths or two months' supply under resolution No. 3 for two votes alone; and under No. 4, the sum of $5,543,000 odd for a full six months' vote, or four months' supply in addition to the one-twelfth asked for in No. 1. I am wondering why the Minister has reached out so far especially in reference to resolution No. 4. I understand that resolution No. 4 carries the deficit in connection with the Canadian National Railways. Is it absolutely necessary to pass at this time the full half of the estimated deficit of $15,000,000? Perhaps the minister will make it clear why the change in plan is necessary. I am not objecting, but it might be well to have an explanation.


Mr. RALSTON:: My officers advised me, after I had spoken to my hon. friend and hon. members in the south end of the chamber, that various departments were pointing out that one-sixth of the vote would not be sufficient to meet the necessities of the services in some branches, some of which are seasonal and require heavy payments at the first of the year.
With regard to the Canadian National Railways deficit, as the hon. member knows, the traffic in the early part of the year is down and the amount to be provided is larger than in the summer months, so that the heavy part of the deficit is incurred in the earlier half of the year. And of course the Canadian National deficit is on an annual basis and not on the basis of the fiscal year.
After consultation with the various departments concerned, my officers advise me that they have scrutinized the representations made by the departments, and that in their opinion

these amounts are necessary to carry on the service, and the payments ought to be made fairly soon in connection with the particular services represented in these different resolutions. When the bill is introduced, hon. members will find a schedule at the back of it giving the different items which are the subject of different monthly periods for which the votes are granted.


Richard Burpee Hanson: That is as regards resolutions Nos. 2, 3 and 4?


James Layton Ralston: Yes.
Motion agreed to and the house went into committee of supply, Mr. Vien in the chair.



INTERIM SUPPLY BILL

Mr. RALSTON moved:: 1.	Resolved,	That	a	sum	not	exceeding
$41,455,066.47, being one-sixth of the amount of each of the several items to be voted, as set forth in the estimates for the fiscal year ending 31st March, 1941, laid before the House of Commons at the present session of parliament, be granted to His Majesty, on account, for the fiscal year ending 31st March, 1941.
2.	Resolved,	That	a	sum	not	exceeding
$2,318,646.13, being one-twelfth of the amount of each of the several following items to be voted, as set forth in the estimates for the fiscal year ending 31st March, 1941, laid before the House of Commons at the present session of parliament, in addition to the sum mentioned in resolution No. 1, be granted to His Majesty, on account, for the fiscal year ending 31st March, 1941, namely:-
Votes Nos. 6, 8, 101, 124, 127, 128, 42,
140, 141, 147, 149, 150, 162, 167, 168, 170,
171, 172, 268, 270, 355, 375, 407, 410, 419,
439, 443, 445, 447, 460.
3.	Resolved,	That	a	sum	not	exceeding
$507,316.67, being one-sixth of the amount of the following items to be voted, as set forth in the estimates for the fiscal year ending 31st March, 1941, laid before the House of Commons at the present session of parliament, in addition to the sum mentioned in resolution No. 1, be granted to His Majesty on account, for the fiscal year ending 31st March, 1941, namely:

Votes Nos. 17 and 31.
4.	Resolved,	That	a	sum	not	exceeding
$5,543,071.67, being one-third of the amount of each of the several items to be voted, as set forth in the estimates for the fiscal year ending 31st March, 1941, laid before the House of Commons at the present session of parliament, in addition to the sum mentioned in resolution No. 1, be granted to His Majesty, on account, for the fiscal year ending 31st March, 1941, namely:-
Votes Nos. 22, 39, 99, 156, 165, 191, 192,
193, 196, 453, 459.


Ernest Edward Perley: The Minister of Agriculture is not in his seat. May I ask whether resolution No. 3 will take care of the costs incurred in connection with the Prairie Farm Rehabilitation Act, particularly in connection

Ways and Means-Interim Supply
with dug-outs, dams and work of that sort? I understand that there was a considerable overexpenditure. Many of those who put in dug-outs expecting to be paid found that the money was all gone owing to the fact that contractors had been allowed to put in a large number of these dug-outs. Is any part of this vote intended to meet expenditures in connection with these dug-outs?


James Layton Ralston: In the absence of the
Minister of Agriculture, I can only say that the vote is available for payments in connection with works which were authorized and for which commitments were made. If the works in question come within that category, they will be paid for out of the vote.


Mr. MacINNIS:: The understanding of this group with regard to the resolutions before us is that we shall have an opportunity to discuss all these items when the regular estimates are under consideration. On that understanding we wish to refrain from discussion at the present time.


James Layton Ralston: That is the understanding.


[Stage Direction]
Motion agreed to.
Resolutions reported, read the second time and concurred in.


[Stage Direction]
Hon. J. L. RALSTON (Minister of Finance) moved that the house go into committee of ways and means.
Motion agreed to and the house went into committee, Mr. Vien in the chair.
James Layton Ralston: Resolved, that towards making good the supply granted to His Majesty on account of certain expenses of the public service for the fiscal year ending 31st March, 1941, the sum of $49,824,100.94 be granted out of the consolidated revenue fund of Canada.


Richard Burpee Hanson: Adverting to schedule C, in which the items are enumerated, it may be that a six months' vote in connection with item No. 459, for the Canadian National Railways deficit,
S15,000,000, is required now, but is that true with respect to item No. 156, the national parks bureau, historic sites, and so forth, for which the vote is $1,144,215?


James Layton Ralston: That is the very item which the secretary of the treasury board referred me to first when I called him on the telephone. Before I had seen this bill, I wanted
to find out what the nature of the services was, and I said, " What is in need of the six months' service?" And he said, "Parks particularly, because we have to make commitments early in the year." He said that the expenditure is all over by September or October. I join with my hon. friend in being surprised about it, but I can give only the information given to me. I assure my hon. friend he will have ample opportunity to discuss the matter when the estimates are before the committee of supply.


[Stage Direction]
Motion agreed to.
Resolution reported, read the second time and concurred in. Mr. Ralston thereupon moved for leave to introduce Bill No. 21, for granting to His Majesty certain sums of money for the public service of the financial year ending the 31st March, 1941.
Motion agreed to, bill read the first and second times, and the house went into committee thereon, Mr. Vien in the chair.
On section 1-Short title.
John Ritchie MacNicol: It would be beneficial if the members had the bill before them.


James Layton Ralston: I think it would be the first time such a bill was ever distributed in the house. My hon. friend will understand that the bill is not printed, that is it has to have a number, and that it does not get a number until after introduction. Therefore we cannot print the bill before it is introduced. I should have seen that the draft bill was printed, as I did yesterday, but in this case apparently it was not done.


[Stage Direction]
Section agreed to.
Section 2 to 6 inclusive agreed to.
Schedules A, B and C agreed to.
Bill reported, read the third time and passed.
[Stage Direction]
Hon. J. L. RALSTON (Minister of Finance) moved that the house go into committee to consider the following resolution:
That the governor in council be authorized to raise by way of loan under the provisions of the Consolidated Revenue and Audit Act, 1931, an amount not to exceed in the whole the sum of seven hundred and fifty million dollars for paying or redeeming the whole or any portion of loans or obligations of Canada and also for purchasing unmatured securities of Canada and for public works and general purposes.
Motion agreed to and the house went into committee, Mr. Vien in the chair.
[Stage Direction]


Government Loan-Mr. Ralston
Richard Burpee Hanson: Perhaps
the minister would be good enough to make a statement now.


James Layton Ralston: There were two matters I wanted to mention to -the committee. One was in regard to a question asked by the leader of the opposition with regard to section 4. The hon. gentleman asked me whether there were any other general borrowing powers outstanding, in addition to the amount authorized by this measure. I told him that we had the 1750,000.000 general act of last year, which had been exhausted by the issue of war savings certificates, and that I was not aware of any other act. As a matter of fact,^ I should tell him that the general appropriation act of each year contains provision for borrowing up to an amount of $200,000,000, and there has been borrowing under that act to the extent of $65,000,000. I believe the announcement is to be made to-day, but a day or two ago we issued $65,000,000 of 2 per cent bonds, I think for five years, in retirement of an $80,000,000 issue which is maturing. In other words, at the moment, until the new appropriation act is passed covering these estimates, there is outstanding the power to borrow $135,000,000, the difference between the $200,000,000 provided for in the general appropriation bill of last year and the $65,000,000 just issued. That power will expire concurrently with the passing of the new appropriation act.	_	_
Another matter was mentioned last night by the hon. member for Cumberland (Mr. Black), as to whether it was intended, out of the funds provided by this bill, to pay the cost of administering the Department of National Defence. At that time I told him that was the intention. I should have directed attention to the fact that in the general estimates there is provision for _ a comparatively small amount for the administration of the Department of National Defence, which is in addition to any sums which will be paid out of the money provided by this bill. At page 25 of the estimates as tabled the hon. member will find provision for $228,925.42 for the Department of National Defence, normal services, pensions and other benefits.
The hon. member for Northumberland, N.B. (Mr. O'Brien), asked a question with regard to the purchase of timber by the British government. I have just received a memorandum from my secretary in this regard. I am afraid I shall have to read this memorandum, since I have not had time to study its contents:
On the advice of Mr. Wiseman and (through him) of Sir Gerald Campbell's office, I communicated with Major L. R. Andrews, manager

of the trade extension bureau of the British Columbia Lumber and Shingle Manufacturers' Association regarding this matter. While there are in Canada representatives of the British ministry of supply, there are no representatives here of the timber controller for the British government. I quote from a memorandum which Major Andrews has sent me, as follows:
" Major A. I. Harris, timber controller for the British government, handles all bulk purchases of lumber and timber. Up to the present he is dealing through the regular channels. That is, his inquiries go to the big timber agents and importers in the old country who contact their representatives in Canada for quotations, usually requesting prices on very large volumes, 50 million to 150 million feet at a time delivered to a Canadian port. The timber controller then arranges for his own freight to the old country.
" In connection with aeroplane spruce, which is a specialty wood, the ministry of supply have appointed Mr. Bryan Gatty (at Vancouver) purchasing agent for the British and French governments.
" In connection with boxes Mr. Bennett, of the British Box Board Commission (916 University Tower Building, Montreal) is sole purchasing agent for the British ministry of supply for boxes (in the same office as Mr. Ken Fensom, timber commissioner to the United Kingdom for eastern Canada).
" In connection with pit props Mr. L. T. Daniels has been appointed by the ministry of supply as head of the Pit Prop Export Limited. He is located at 4 Imperial building, Moncton, New Brunswick. He has control of purchases of all pit props for the United Kingdom ministry of supply.
" Mr. R. L. Sargant, secretary-manager of the Canadian Lumbermen's Association, has authorized me to say that he is in agreement with me that the purchase of timber by the timber controller is being very well handled and there does not appear to be any necessity for local representation in Canada."
By that I presume he means local representation of the British timber controller.
" If such were the case it would appear obvious that a representative would be attached to Colonel Greenly's staff here."
As my hon. friend knows, Colonel Greenly is head of the British purchasing mission here.


Mr. ROGERS:: I believe several questions were asked while I was not in the house yesterday afternoon, and an undertaking was given that they would be referred to me for reply. One question was asked by the hon. member for Cape Breton South (Mr. Gillis), in the following terms:
What is the regulation of the minister's department in respect of the_ following category: A married man with a wife and dependents who was parted before enlistment, but who, in accordance with the court decision, was compelled to support his wife and child before enlistment, neglects to make provision for them! His wife has presented her marriage certificate and a cony of the court order granting her support. This support had been taken from her

Government Loan -Mr. Hanson (York - Sunbury).
by virtue of her husband's enlistment, he having failed to register at that time. Have there been any complaints of that kind? If so, what is the ruling in such eases?
Quite a number of such cases have already arisen. The dependents' allowance board obtain a statement under oath from the wife and forward it, together with a copy of the court order or separation agreement, to the commanding officer of the soldier concerned, who is then paraded and given an opportunity to recognize his responsibility. Considering both the wife's statement and the husband's statement, the board then decides on appropriate action. If an assignment of pay by the soldier is not sufficient to make up the required sum under the court order or separation agreement, the board may then make an additional allowance up to the required sum.
I also have a question which was asked by the hon. member for Rosetown-Biggar (Mr. Coldwell), in which he refers to a class A boy, who under existing regulations suffered some special hardship with respect to his eligibility for dependent's allowance. The answer to that question is as follows: It is not understood what the hon. .member means by a class A boy, because there is no such category in the militia. It may be .that he refers to the grouping which applies to tradesmen's rates of pay under classes A, B and C. Boys under the age of eighteen are considered as learners or apprentices and are not entitled to tradesmen's rates of pay until they are mustered as men. The rate of pay for a boy is 70 cents a day. He may make assignments to a dependent and apply for dependents' allowance on behalf of the dependent. If the hon. member for Rosetown-Biggar would give me the name and the particulars of the boy to whom he refers, I shall have his case investigated in order to ascertain the reason for his being refused dependents' allowance on behalf of his parents. I believe that was the particular question raised by the hon. member.
Then two questions were asked by the hon. member for York West (Mr. Adamson), as follows:
1.	Is the minister prepared to tell the committee how many Bren guns have been produced, and-unless he would consider this as not in the public interest-whether the Bren guns so far produced have been satisfactory?
2.	Are we producing any 25-pounder guns, any anti-aircraft guns, and what is the production of small arms ammunition and of field ammunition?
My hon. friend is not in the house at the moment, but it is not considered in the public interest to supply the answers to these questions. I shall be very glad indeed to give him a further explanation of why it appears necessary to give such an answer at this time.
95826-19J


Richard Burpee Hanson: That seems to be a reversal of the attitude taken yesterday afternoon by the minister. If he will look at page 230 of Hansard he will see that
he promised to give me a statement on the production of Bren guns, and used the words, "possibly this evening." I have been expects ing him to do so. However, if in the interim he decided on some other course, or that it is not in the .public interest to do so, he will be prepared to take the responsibility. But I thought it was decided last night that a statement would be made. At all events, that is how I interpreted his remarks.


Norman McLeod Rogers: I have a copy of Hansard before me. The leader of the opposition said:
I should say that the minister could at this moment give as a general statement, information as to whether we are producing Bren guns.	e
I went on to say that I would be glad to make a statement upon that matter, and did use the expression, "possibly this evening." The question put by the hon. member for York West was somewhat beyond that, as my hon. friend must realize. I might say I should be very glad indeed to explain to the leader of the opposition the entire position with respect to the production of Bren guns. May I point out that in these matters I am acting entirely after consultation with officers of the department? I could go this length and say that the Bren gun is in production, but certain modifications just received from England will be adapted before actual issue takes place. I can go that far in making a statement upon the matter, but it is not considered in the public interest to answer the question specifically as put by .the hon. member for York West.


Richard Burpee Hanson: I would be pleased if the minister will see me about the matter, because the production of Bren guns is of great importance. Of course, if there is real good reason why information should not be made public, I will respect it.


Norman McLeod Rogers: I appreciate that.


Mr. HANSON (York-Sunbmy):: I take the responsibility of saying that. And while I am on my feet-and I understand that we are dealing with the new resolution, No. 17 on the order paper with respect to the proposed loan of $750,000,000-may I observe that the minister has made some statements with reference to dependants' allowances, and other matters, which I suppose might more properly come under the war appropriation bill. While we are dealing with dependents' allowances, however-
Government Loan


James Layton Ralston: Oh, what I called was the order for the debate on second reading, but it would seem that we are in committee on the resolution.


Richard Burpee Hanson: I was misinformed. I thought we were dealing with order No. 17.


James Layton Ralston: I am sorry if there is a misunderstanding.


Richard Burpee Hanson: We can go back to a consideration of the bill, and for that purpose we would have to report progress on the resolution.


James Layton Ralston: I must confess I did not hear the number of the order called. When calling the order I simply said, "war appropriation." However, according to the chair we are now dealing with the resolution involving the sum of $750,000,000. That being so, I move that the committee rise, report progress and ask leave to sit again.
Progress reported.



WAR APPROPRIATION BILL


[Stage Direction]
The house resumed from Monday, May 27, consideration in committee of Bill No. 18, for granting to his majesty aid for national defence and security-Mr. Ralston-Mr. Yien in the chair.
On section 2-Appropriation.
Richard Burpee Hanson: Last evening, in response to a request I made to the Minister of Finance, he was good enough to send me a copy of a typewritten statement showing total war expenditures up to March 31, 1940, amounting to over $118,000,000, and he supplied me with what I thought was to be a break-down of those figures. What he sent me in fact is not a break-down, but merely a distribution of the total among the different departments. For instance, under the heading of details there is an amount of $112,469,000 for the Department of National Defence.


James Layton Ralston: Is the hon. member reading from Hansard?


Richard Burpee Hanson: No, from a memorandum which the minister read into Hansard.


James Layton Ralston: Yes, that is what appears in Hansard.


Richard Burpee Hanson: But this is not the information for which I was asking. It is a distribution of total expenditures, but it is not a break-down, in the sense an accountant would use the term. We would like to have details of the $67,579,000 for the army, and that sort of thing. That is what I call a break-down. We cannot intelligently discuss the details under this section of the bill until we have that information. Probably I should have indicated my position earlier in the day, and should have pointed out to the minister that the information he gave was not a break-down of the total war expenditures, but merely a statement of distribution.
I am not so particular about the $6,000,000 for the other departments indicated in the table, because I believe I understand what most of those expenditures would be. I would point out, however, that we should have the details respecting the huge expenditures on the army, the navy, the air force and the air training plan. Perhaps the word " breakdown " is not the correct technical term.
As it is now six o'clock, I would ask the minister to give consideration to what I have said, and to ascertain whether he can give the committee the details. I am not asking for complete accuracy to the last cent or dollar, but I believe we should have some idea what the expenditures have been.


James Layton Ralston: I find I did give my hon. friend what I thought I had given him. I was afraid I had made a mistake. I understood he desired a break-down. By that term I understood I should supply a distribution between the various services, the air training plan and other defence services, and among the other departments. I gave my hon. friend that information. I did not know he was asking, nor at that stage did I intend to give him, a break-down of the expenditures for the army, or the navy. That is, I was not at that time attempting to show how much of the sum allocated to the navy was spent for boats, how much for pay and allowances, and so on. I should be glad to consider that point, but I would ask my hon. friend during the dinner recess to consider whether it is advisable to break down those figures, and how far.
In what I have done I am following the practice of 1915 and 1916. I am not suggesting that that is binding at this time, but it is what was done by the then Prime Minister, as reported at page 1397 of Hansard for 1915. At that time Sir Robert Borden said:
The statement which has been given to me in regard to the expenditures by various departments of the government under the appropriation, up to the 30th January, 1915, is as follows.

War Appropriation Bill
And then he set out a figure of $32,000,000 for militia and defence, as a whole, $3,000,000 for naval service, and so on. That was all that was done at that time. The other items in the table referred to other departments.
I wonder if my hon. friend, to save the time of the committee and of the department, would indicate to me on what items he would like to have information as to the amount of the expenditure made.


Richard Burpee Hanson: The main items of course are the army, the navy and the air training plan.


James Layton Ralston: But what items in those?


Richard Burpee Hanson: We cannot really tell until we see them. This is merely a distribution; it is in no sense the detailed expenditure. If it is not in the public interest that we should have the information, the government must take the responsibility, and I have not very much more to say. For the sake of illustration, I was told by a member of the other house, a gentleman who is very close to my hon. friend, that some Tory profiteers had gone down to New York, bought a lot of rich men's yachts and sold them to the government. They are now in Bedford basin or somewhere in that vicinity. I did not treat the story very seriously, but I would ask what amount has been spent in the purchase of bottoms in the United States, where the purchases were made, and so forth. That is merely an illustration of what I have in mind, and I am giving it to illustrate what we would like to have. Of course, we do know that pay and allowances must account for a large portion of the $69,000,000 for the army, and there is no necessity of going into that. But there are other things, and until we know what the government has done, until some detailed expenditure is given to us, how can we possibly investigate these expenditures? That is what I have in mind and the minister might give it consideration during the dinner hour.


James Layton Ralston: I assure my hon. friend
that these are not mere generalities. I want to give the utmost information I can. But I say to him also that I do not believe any government has ever before submitted a statement showing each individual item. Take, for instance, the item my hon. friend mentions. The statements in the public accounts appear m the form of votes. It may be pay and allowances and other things. That was exactly the purpose I had in mind when I put opposite pages 2, 3 and 4 of this bill certain headings which would indicate certain objects of expenditure respecting which hon. members could ask questions. But I did not expect to bring
down the public accounts, as it were, showing in detail all the individual invoices paid in respect of each particular item. I suggest to my hon. friend that he and I both give the matter consideration during the dinner recess; and I think the best way would be, if he has anything in mind with respect to which he desires to ask questions, to do so, or if I have anything in mind with regard to a breakdown of the expenditures I shall be glad to give it. That will give my hon. friend an opportunity to ask for details in connection with a particular item; and if the information can be given, in the public interest, it will be given, but if it cannot be given in the public interest, an explanation will be made which will be entirely satisfactory to my hon. friend.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.
On section 2-Appropriations.


James Layton Ralston: The leader of the opposition asked for some further figures in connection with the expenditure. I may say that I did not expect to be giving a further breakdown, but I have had the office of the comptroller of the treasury working during the recess, and I expect to have in a few minutes figures which will show a break-down under the general headings which are mentioned in the explanatory notes to the bill itself.


John Ritchie MacNicol: May I ask the Minister of National Defence a question in connection with paragraph (c), particularly with regard to the word "industry." I read in the press that the United States government have issued an order that no one but citizens of that country shall be permitted to work on the manufacture of any military equipment for that government. Will there be or is there in Canada a similar order, permitting only British citizens to work on the manufacture of munitions required by this government?


Mr. HOWE:: There is no such order. Canada is interlocked with the United States in a good deal of its production, and I think it would be hardly feasible to put an absolute prohibition against anyone excepting a citizen working on any British munitions order. I believe we would find that our production would be very seriously curtailed.


John Ritchie MacNicol: Then how can the United States do it?
War Appropriation Bill


Clarence Decatur Howe: The United States is a
more self-contained industrial country than Canada. Canada is still dependent upon the United States for certain grades of steel, for cotton and for certain other materials, and I believe that an order of the kind that my hon. friend suggests would cut our production tremendously.


John Ritchie MacNicol: As a matter of fact I had not suggested anything. I only asked a question, and my question pertained particularly and solely to the manufacture of munitions in Canada, not in the United States. We have no control over whom they employ in the United States to make munitions for Canada, but have we not control over Canadian manufacturers employing people to make munitions in this country?


Clarence Decatur Howe: We have control, of course. But we have passed no such order.


Howard Charles Green: The other day, when the hon. gentleman acting as Minister of Munitions and Supply made a statement, he mentioned that certain articles of equipment could not be manufactured in Canada. Apparently the intention was that some would be procured in the United States and some would be obtained in Great Britain. It seems fairly obvious now that it will not be possible for us to get equipment in Great Britain. Certainly we shall not be able to get very much from there. Under those conditions would it not be possible for the government to initiate a programme under which all equipment shall be made in Canada or purchased, say, from the United States or from Australia?
There is one other matter upon which I should like to have information. Apparently there are across the country many plants which have been anxious to do war work and have not yet been given an order, perhaps because they could not carry it out as cheaply as some other firm. In view of the seriousness of the situation in which we are placed at the present time, would it not be well to allot work of one kind or another to all these plants and get them into the war effort without any further delay?


Clarence Decatur Howe: I may say that since the position of Britain as a supplier of Canada has changed, the Department of Munitions and Supply is making strenuous efforts to review production of such war materials as it had been dependent upon Great Britain for. We are exploring the possibilities of production in Canada; we are replacing certain supplies by obtaining them from the United States instead of from Great Britain, and we are reviewing our whole purchasing orogramme. fMr. MacNicol.]
Our position previously, of course, was quite obvious. We were collaborating with Great Britain; where they had obvious advantages in respect of production we were not attempting to manufacture the same class of supplies. We thought our best contribution would be to concentrate on certain articles which we could produce more advantageously than Britain. At the moment we are revising that policy in the light of -the existing situation, and we anticipate that there will be a speeding up of production and an opening up in Canada of new lines of production just as rapidly as they can be organized.


Howard Charles Green: What about making use of these smaller plants across the country?


Clarence Decatur Howe: As I interpret my job, it is to supply the requirements of the armed forces in the most efficient manner possible. As far as I am concerned I am not interested in whether a plant is large or small provided it can do the job. We have certain work to do; we have a complete record of every plant in Canada and its equipment, and we are doing our best to use the resources of Canada most efficiently.


Howard Charles Green: I understood the other day that the question was one of cost. I am not suggesting that any particular small firm should get work, but I am asking whether it would not speed up the production of equipment if all the plants in Canada were used on the manufacture of one or another type of equipment.


Clarence Decatur Howe: Well, it would indeed, provided we required types of production that could use all the plants. As it is, we have certain requirements to fill; and as I say, we have a record of every plant in Canada. We try to fill those requirements as efficiently as we can and at a reasonable cost, although we have never let cost be the entirely determining factor; the factors of deliveries and quality are very important, in fact they are often the determining factors. But naturally we pay no more for this equipment than it is necessary to pay.


Thomas Langton Church: Will there be sufficient
funds available in case the government finds that, owing to the progress of the war, it may be necessary to call out the militia all over Canada? Also at some militia camps last June there were complaints of a lack of mechanized equipment.
Might I refer to another matter under this bill for granting to his majesty aid for national defence and security? Section 91, subsection 7 of the British North America Act says it is this parliament's responsibility under

War Appropriation Bill
militia and defence for the protection of all municipal and provincial property in time of war, which includes in the Niagara district, for example, rights of way and towers for direct current of the power lines. The importance of those power lines during the last war is shown by the fact that at one time Ontario was supplying 56 per cent of all the munitions because Ontario's industries had cheap power ready. If the power went off through lack of guards, the production of munitions would be stopped or slowed up. I should like to know what the government is going to do about this question of soldier guards on all municipal and provincial utilities. This matter has been before the house; it was one of the scuttled motions away back in January. The onus of protecting the lines during the last war was on the dominion government under the words, "militia and defence." For example, there is a camp at Camp Borden, another at Barriefield, and another at Trenton. Soldiers in these camps were, in the days of the first war, used in part of their time, while in training, for this guard duty, and were utilized in guarding the rights of way of public utilities all over Ontario.
What is the government going to do also about cadet services? In the great war, in fact, in all the ware that we have been engaged in, had it not been for our cadet services the militia units, who are largely recruited from former school cadets, would not have made the showing that they did. They were the back-bone of the militia during the days before the South African war, in the Northwest rebellion and in the last great war. I submit that we should have a declaration from the government on a forward cadet policy in conjunction with boards of education.
There have been many requests for transportation on the railways for our soldiers. The soldiers are moved from Windsor to Camp Borden and from the maritimes to Toronto. In the last war the government issued what were known as soldier commutation tickets, and were carried on the local street cars free in many cities. I have seen instances, in the city I come from, of women and children travelling on trains and having to pay full fare, coming long distances. Some of these camps are only five or ten miles from a city. The men are getting $1.30 a day. When 30 cents a day for carfare is deducted, there is not much left them; and if they are late they are fined and may lose two or three days' pay. The result is that the women and children suffer. The minister ought to look into this matter and make an announcement. He should get in touch with the boards of education in connection with the cadet movement.
May I say one word in conclusion with reference to soldier insurance. Surely out of this $700,000,000 there can be found something for looking after the insurance of our men who are going overseas, both for those who get killed and for those who come back after the war. In my opinion it would be cheaper if we had a system of soldier insurance to take care of dependants of those who are killed and to aid in the civil reestablishment of those who come back. A system of this kind would effect a large economy in pensions, and widows' and other allowances.
I hope that as the session proceeds the government will see the advisability of having one or more private sessions. If we had one or two such sessions, we could clean up a large number of non-contentious matters which, if freely and fully explained, would no doubt pass easily, such as improvements and inequalities in dependants' allowances, guards, recruiting, and other soldier grievances.


Mr. CASTLEDEN:: May I refer briefly to a matter of vital importance which so far has been almost completely overlooked in the debate? The Minister of Finance spoke the other day of the morale of our Canadian troops. Without that proper morale, all the money, all the men and all the sacrifice will be of no avail. What creates this spirit in our men and in our people? It is created by faith and confidence, by that assurance which comes from the knowledge that their leaders have the ability and the power to render proper leadership. How can we best create that assurance in the minds of those who go to sacrifice all that living means? How can we maintain in the hearts and minds of those who remain at home that proper spirit? We can do it only by assuring them that their sacrifices are not again a waste of life and material, and the creation of a great debt which will cast its shadow over the lives of generations yet unborn. There must be proof of effective action at home. They must know that there is not corruption or profiteering. We must rid Canada of the spirit of a profiteering world. These boys must be assured that justice will be preserved and democracy maintained at home. Let the traitors of the great cause of democracy-those who would use the freedom given to them under the British flag to betray us in the dark hour of trial-be treated as befits their acts; but let us be equally sure that the civil liberties, the justice and the fair play, which are also a part of our traditions, will not be destroyed in the process. That is vital.
Canadians must always remember that the civil liberties won for us by our forefathers are our only guarantee for progress. It 7
War Appropriation Bill

those liberties for which we are at war. They are sacred to all true Canadians-they must never be abused. The maintenance of those liberties is a sacred trust of this parliament. To-day Canada's manhood goes to fight to maintain freedom and democracy abroad so that these rights still may be the heritage of future generations.
It is incumbent upon every parliament of Canada to respect and constantly protect every clause of our constitution. Orders in council may be necessary at a time of stress, but Canadians must be eternally vigilant to see that these privileges are properly used. No cabinet should be permitted to set aside legislation passed by parliament as was done on August 26, 1939. Not until seven or eight days later was the War Measures Act passed which permitted such action. Why? When our constitution is not respected, Canadians must make their instant protest; for ,the path of such action leads directly to anarchy.


James Layton Ralston: I am sure my hon. friend is not aware that the War Measures Act was in force at the time, forming a part of the statutes of Canada published in the Revised Statutes of Canada, 1927.


George Hugh Castleden: Was it not made
retroactive?


James Layton Ralston: No.


George Hugh Castleden: While men offered
their life-blood in the hour of danger, profiteering industry refused to provide the sinews of war. To-day Canada hangs her head in shame as we find our earliest efforts thwarted for want of supplies. Canada and the empire were sold out.
Quoting from Hansard of September 12, 1939, page 179, I find these words of the Minister of Transport (Mr. Howe):
I can say to my hon. friend that from that day to this the defence purchasing board has done its very best to place contracts on that basis and has used every pressure that could be brought to bear in the form of patriotism and so on, but to date it has not succeeded in placing a single contract on that basis.
This is one of the most revealing cases of the attitude of industrialists toward the war. From this statement it is quite evident that there was agreement among the contractors. It is abundantly evident, too, that patriotism and sacrifice mean nothing to them-profits mean everything. Profits to them mean more than Canada or the British empire. They are largely responsible for our present plight with regard to the shortage which is paralyzing our war effort. Instead of yielding to the demand for a greater increase in profits, why
[Mr. Castleden.l
did not this government or the administration nationalize the industries which are so vital to our very existence?
Is money again to be considered of more importance than life? Many boys from the western plains leave debt-ridden homes as they go to fight for Canada. After enlisting, they hear that relief quotas are to be drastically reduced, farm machinery prices are raised within ten days after the election, and the soldier goes into battle wondering how his aged parents and his sisters can live on the meagre returns from the home he has left. There are no profits for him. To-day he looks to this house for leadership. He asks why, if he is willing to give his life, the money-lenders should not be willing to give a part of their money. In the last war Canada socialized her greatest natural resource, the blood of her manhood; and while this was being poured out, profiteering industry and money-lenders enriched themselves with tax-free bonds, and laid upon coming generations a debt so staggering that we can but borrow to pay the interest. Too soon wives and parents will be sent telegrams to tell them that their husbands and sons will not come back. No telegrams will come to tell the money-lenders that some of their contribution will not come back.


An hon. MEMBER:: It will not either.


George Hugh Castleden: Why do we not have some equality of sacrifice? The boys in 1914-18 died in what they were told was a war to end war.


Olof Hanson: What is the hon. member reading?


Richard Burpee Hanson: He is a new member, let him go on.


Olof Hanson: My point of order is that I should like to know whether he is reading his own speech or if someone else wrote it for him.


Mr. ROWE:: There is no point of order in that.


Olof Hanson: Is he reading his own speech or what someone else said?


Thomas Vien: I do not think that is a point of order. It might be a question to be asked of the hon. member who has the floor.


George Hugh Castleden: I thank you, sir. We maintain that the natural resources of Canada are the birthright of the Canadian people. We believe that they should be used to the utmost in the winning of this war. This control over our life eats like a cancer into

War Appropriation Bill
the good young life of our country, and our people wilt and rot. Canada is rotting to-day. The most healthy part of this nation, as far as I can see, is in the maritime provinces where cooperative societies are making some progress. Ex-directors, directors and legal advisers of big business are, I fear, too close to the coffers and inner councils of this government.


Olof Hanson: Mr. Chairman,
on a point of order-


Thomas Vien: Order. The question is raised as to whether the hon. gentleman is reading his speech. The rules of the house do not permit him to do so. If the hon. gentleman is reading his speech-


George Hugh Castleden: I have some notes.


Richard Burpee Hanson: On that point of order, my understanding is that the hon. member is following his notes pretty closely but, he being a new member, I suggest that we allow him to proceed; I think we shall make progress better in that way than in any other.


Thomas Vien: I draw the attention of the committee to the fact that, from the beginning of this session, no objection was ever raised to an hon. member reading his speech; but when the attention of the Chairman is drawn to the fact that an hon. member is reading his speech, the Chairman has no alternative but to call attention to the rule.


George Hugh Castleden: Thank you, sir. The common peril at this time, and the common good of this and future generations, demand the public ownership of all the natural and industrial resources of this country. These are the wealth that provides the sinews of war. We also believe that if you take the profits out of war, you would do a great deal to abolish war. If that is done, perhaps the world and humanity may yet be saved. Canadians have inherited a great land, and they are willing to sacrifice for it. Our government should be immediately condemned if they fail to take these natural resources, the things that belong to the people of Canada, and use them in this hour of trial. Western Canada has been betrayed by the governments of this country. The people in that land have been exploited; the organization of society in the west is but a shadow of its former self. The other evening this house listened with bated breath to the cry of humanity-the cry of a mother starved for her brood. I watched, with sinking hopes, the looks of disdain on the faces of some hon. members opposite. She
spoke for thousands. Let me warn this administration that out of that great land of suffering humanity will rise a voice which will demand the restoration of the heritage that has been taken from them. They will demand that measure of equality and of social justice and the opportunity to live which have so far been denied them. If this government fails, there will sweep across Canada, when this war is ended, a rising protest which will take this present administration and drive them into the "abysmal depths of oblivion" from which they never should have emerged.


Some hon. MEMBERS:: Oh, oh.


George Hugh Castleden: The western province^ have been the victims of vicious exploitation. Uncontrolled grain exchanges, unchecked machine combines and ruthless mortgage and finance companies have looted and ravaged the great land of the west. The price of everything the farmer buys is controlled, but he is given no assuranoe even of a minimum price for the commodities he sells. Over ninety-five per cent of the farmers of Saskatchewan are in debt; almost ninety per cent have mortgages on their farms and forty-five per cent of them have lost their land and become mere tenants and share croppers. About one-third of the people in the constituency which I have the honour to represent are of Ukrainian birth. They came to Canada, have worked to build a home, and now in the hour of trial they are willing to offer themselves to fight for that measure of freedom which they know should be the heritage of every Canadian, and which was denied them in Poland from which they came. These men are offering themselves willingly. To the eternal shame of Canada we find these dispossessed people more willing to die for Canada than are the money-lenders to surrender their pound of flesh. Give to Canadians the assurance that when this war is over and they come back, opportunity will exist for all. They look to you for that guarantee. Demonstrate to everyone that action and a square deal will be the great achievement of this parliament; that will inspire our people to great sacrifices, and so great will be their morale that they will win against all odds. This administration has been in power for over five years; it has been returned with the greatest majority ever enjoyed by any government in this house-


An hon. MEMBER:: Too long and too big.


George Hugh Castleden: They have an opposition which is willing to assist in every way and a willing people ready, yes begging, to serve. Do not betray them.

War Appropriation Bill


Mr. NEILL:: The Minister of National Defence (Mr. Rogers) was kind enough before six o'clock to answer one or two questions with regard to dependents' allowances, although it did not seem very appropriate to the section. I wonder if he will allow another question in that connection.


Norman McLeod Rogers: Certainly.


Alan Webster Neill: It is perhaps not so much a question as an explanation which I think will be appreciated by many people throughout the country who seem to think-and I share the view-that some discrimination exists in connection with the matter.
When the war began, the government in their wisdom, and I think rightly, decided to realign the payments made to soldiers' wives, and also introduced payments to dependents. They raised the payments made to wives from $20 in the last war to $35, quite properly. They also introduced the question of soldiers' dependents, giving the woman an allowance for the children the soldier had up to two, and also took cognizance of dependent mothers. But for some unknown reason they allowed a dependent mother, who stood in the place of a wife to him as far as housekeeping and so on goes, only the sum of $20, and the argument for this is along these lines. I applied to some of the numerous boards, and I quote the answer I received as to why a widowed mother should not get $35 just the same as a wife:
As a consequence of the additional responsibilities assumed by a. wife in regard to the maintenance of a home for herself and her husband and possibly her children, the total expenses involved are considered to be greater than those of a mother whose responsibility ends with her own maintenance.
I differ very much from that. In the first place there is no need to introduce the question of children because they are paid for separately. Further, a woman does not have any more expense maintaining a home for herself, if she has no children, than if she is the soldier's mother. Furthermore, the wife of a soldier to-day would naturally be a young and presumably healthy woman. She would not require as much to maintain herself; she could even go out to work to a certain extent, if she had the opportunity. Certainly she could do certain chores round the house, such as splitting and bringing in wood, that would be perhaps impossible for an aged mother to do. Again, the old mother would probably require medical care and attendance, which surely would bring her requirements up to those of a wife. So, instead of giving only $20 to a mother, I would suggest that the amount should1 be the same as that given a

wife, which is $35. If $35 is considered to be a fair and reasonable sum for the woman who is left alone, who is relieved of many of her responsibilities in connection with maintaining a home through the absence of her husband, I think that should be considered also a fair and reasonable sum for the mother.
I should like also to refer to a case which probably does not arise very often, but which has arisen and in which I think a favourable decision might be given. I took up the case of a man who was the sole support of his grandmother. When he went overseas she was not allowed anything. When I took up the case I discovered that according to the rules, which were formulated last August or September, the grandmother would be eligible if the soldier were illegitimate, but that if he was of legitimate birth the grandmother would not get anything. I believe that was later altered, but only to the extent that now no grandmother is eligible for the allowance. I imagine there would be very few cases in which the grandmother would be the sole dependent of a soldier, and in those few cases I think the department might well waive the difference between the words " mother " and " grandmother." That is a small matter which could be easily adjusted. I should like an explanation on that point and also as to why an aged widowed mother, requiring assistance in her house and perhaps medical care, should not receive the same allowance as an active wife.


Norman McLeod Rogers: I should like to thank my hon. friend for bringing these cases to my attention. The other day the Minister of Finance announced that the regulations concerning dependents' allowances would be reviewed in order to discover cases of hardship and to seek remedial measures where such cases were found. I quite agree with my hon. friend that it is difficult to distinguish between the soldier's wife without children and the mother he mentioned.


Richard Burpee Hanson: The children do not matter; they are dealt with separately.


Norman McLeod Rogers: Quite so. Actually I believe the amount payable to a mother in the circumstances mentioned is based upon the amount paid under the Pension Act. I should like, however, to take note of both the cases mentioned by my hon. friend, and I will see that they are made subject to review. I shall give him any further information that may be required on that point.


Alan Webster Neill: Not these particular instances only but typical similar cases.

War Appropriation Bill


Norman McLeod Rogers: Quite so. While I am on my feet I should like to say to the hon. member for Broadview (Mr. Church) that the appropriation provided by this bill is intended to cover the expenditures he mentioned, for example the possible expansion of encampments during the summer months and any expansion which may be necessary in our Canadian active service force. Needless to say, if the amount provided is not sufficient for these purposes, more money will be obtained, because we must be guided by the necessities of the situation as they develop.
In the committee there has been some discussion of the position of tanks and their utilization in Canada. I should like to take this opportunity to deal with an exchange of correspondence on the subject of tanks and more particularly on the employment of Colonel Carter, British tank officer, this correspondence having been made public yesterday in a Toronto afternoon paper. I think it is of some importance that this question be dealt with at this stage. Perhaps I might proceed by first placing on record a telegram which I received on November 14 last from Major Everett Bristol, of Toronto, as follows:
In view of newspaper reports yesterday that Canadian government is asking British government for experts may I call your attention to the fact that Colonel E. J. Carter lately chief instructor of the royal tank school, England, one of Great Britain's experts on tank and armoured ear design and tactics is at present at the Mount Royal hotel, Montreal, and proposes to sail for England on Saturday 18th. Colonel Carter who is retired expects to be reemployed in England on his return but in meantime is not under orders and is available if required here. He has already visited the tank training centre at Camp Borden and is well known to General MeNaughton. As a result of meeting him a group of ex-officers and others in Toronto have expressed their willingness to assist in any way that may seem practical in developing tank training equipment and for benefiting Canadian armoured troops generally. May I respectfully suggest that Colonel Carter be asked to postpone his sailing and that he be. interviewed with a view to the possibility of utilizing his services in the training of the tank units of the C.A.S.F. and in the event of production of tanks on this side being determined upon in advising on the technical problems relating thereto.
In reply I sent the following telegram on November 15:
Renly your wire yesterday respecting Colonel Carter, appreciate your interest in this matter. Matter has been carefully considered but our tank organization does not warrant appointment additional senior officers at present.
That is signed by myself. In accordance with the usual procedure my reply to Mr. Bristol was made after his telegram was referred to the appropriate officers of the Department of National Defence for a report.
95826-20i
My reply was based on this report. To put the matter briefly, it was considered that while Colonel Carter was a most competent officer-I should like to have it fully understood that there was no question at all as to his competence1-our tank organization did not warrant the appointment of additional senior officers. Lieutenant-Colonel Worthington, a Canadian officer, was in charge of this work. He had exceptional technical qualifications and was well acquainted with Canadian conditions. He was an officer in whom everyone, including the tank authorities in England, had the greatest confidence. After his return from England, where he had been taking a course in tank tactics and maintenance for over a year, the highest reports on his work were received from the authorities in the United Kingdom. Therefore it was considered that for the present no additional senior officers would be required, since Colonel Worthington was a competent adviser on all matters pertaining to tanks. I might add that during his visit to Canada, Colonel Carter met General MeNaughton as well as other staff officers at the Department of National Defence, where he was received with every courtesy and consideration.
The article in the Toronto Telegram raises the further question of why tank units were not sent forward with the Canadian division. The reasons why we have not sent tank units overseas relate in part to the war establishment of a division and in part to problems of production. So far as the organization of a division is concerned, tank battalions are neither divisional nor corps troops. They are army troops and are supplied on an established scale to each corps forming part of an army. As it was intended at the outset that the first Canadian division would form part of a British army corps in the field, it was decided that tank battalions for this British corps should be supplied by the British army establishment, at least until such time as we were able to work out the problem of tank production in Canada in cooperation with the British purchasing mission. My colleague the minister who is acting as Minister of Munitions and Supply will be in a position to deal with this aspect of the question. I felt it was of some importance that I should place this information before the committee as soon as possible, because I want to make it entirely clear that our attitude towards Colonel Carter was one of respect for his ability. But the officers of the department, with full knowledge of the situation, were convinced that in the person of Colonel Worthington, who had a distinguished record in the last war, and had had specialized training in tactics in England
War Appropriation Bill

recently, we had one who was entirely capable of supplying us with whatever advice might be required in connection with the use of tanks.


Richard Burpee Hanson: While we are on the question of tanks and tank equipment, would it not be desirable that the minister who is acting as Minister of Munitions and Supply give to the committee a frank statement as to what the government policy is in relation to this class of equipment, and also some information in respect of aeroplanes. I have heard something of the story with respect to aeroplanes, and I know something of the difficulties. We have had no statement from any member of the government as to the question of policy on this major equipment, namely aeroplanes.


James Layton Ralston: My hon. friend will note that the minister who is acting as Minister of Munitions and Supply was about to make a statement when the hon. member rose.


Richard Burpee Hanson: We would like to hear it.


Clarence Decatur Howe: I might explain at the outset
that it was not the function of the late war supply board, nor is it the function of the present Department of Munitions and Supply to state the defence policy of the country. It is the function of the Department of Munitions and Supply to obtain materials and supplies as required by the service departments of this government, and the departments in Britain.
However, I am in a position to give a history with respect to tanks, as it has reached the Department of Munitions and Supply, and its predecessor board. On October 20, 1939, a requisition was sent in to the defence purchasing board, which was then functioning, for one hundred tanks, infantry, mark 3, known as Ballantyne tanks, hulls only. That was received from the British purchasing mission. This requisition stated that drawings and specifications would be forwarded as soon as possible.
Drawings and specifications were received by the production department of the war supply board on January 27, 1940. A conference was immediately held between the technical experts connected with the British purchasing mission, the technical experts of the war supply board, and the master of ordnance department of the militia, and it was decided that the logical plant in Canada to undertake the order was the Angus shops in Montreal. The Canadian Pacific Railway, which owns the shops, stated that it would undertake the work, and immediately placed its engineers on the job of organizing production.
fMr. Rogers.]
On April 2, 1940, the British war supply board withdrew the requisition. No reason is given in our files, but it was understood that the drawings we then had were to be replaced with a later development in the line of tanks. In fact, I was told that verbally at at the time, namely, .that other plans and specifications would be along, and that Britain preferred the production of tanks in Canada from a later design.
Since then the department has received no further information. Concurrently with that order, it was the intention of the master of ordnance to develop supplementary production for Canada. Wherever we can, we have attempted to combine British production and Canadian production in whatever of the major munitions of war are undertaken here. Very frequently we share the capital expenditures necessary to provide equipment, and in general we try to coordinate our efforts so that our types of production may follow parallel lines.
That was the policy on tanks, and we have been pressing for a reopening of that subject. I think it would be unwise to pass on to hon. members the reasons given me as to why a further inquiry has not been received from Great Britain.
In the matter of aeroplanes the Department of Munitions and Supply has had two problems: first, to produce the aeroplanes that have been regarded by the technical experts of the government as proper defence equipment for our coasts and, second, we have also had the problem of arranging a supply of aeroplanes for the British empire training programme. We had those two problems well in hand until quite recently. We had all the components for our defence aeroplanes purchased, and we had production going in this country. The same was true of the air training planes. We had certain production in Canada, and certain production arranged for in Great Britain and the United States. The events of the last few days have disorganized that considerably. As I said a few minutes ago. we are bending every effort to reorganize that programme so that it will function with the new sequence of events. I think I can say we have made a great deal of progress in reorganizing our plans, and that at the moment we have the situation fairly well in hand.
In addition to the Canadian requirements of the types I have mentioned, Great Britain herself has organized certain sources of supply of aeroplanes in Canada. About a year or more prior to the war a contract had been arranged with Associated Aircraft, which was a partnership of some six Canadian aeroplane

War Appropriation Bill
firms, to produce aeroplanes for shipment to Great Britain. Another source of production was arranged at a plant at Fort William, for direct shipment to Great Britain. In the latter case, Canada placed a supplementary order of the same planes for her defence forces.
The production for Great Britain is of course going on, because the aeroplanes are being shipped, less engines-the engines to be supplied in Great Britain. Our difficulty has arisen on account of the fact that we have been advised that Great Britain, temporarily at least, will not be able to supply certain engines.


Mr. HOMUTH:: Are we to understand, then, from the minister's statement, that no tanks have as yet been ordered?


Clarence Decatur Howe: That is correct.


John Ritchie MacNicol: Cannot the government order from the United States?


Clarence Decatur Howe: Is the hon. member asking if we have ordered from the United States?


John Ritchie MacNicol: Will not the United States supply this government with tanks?


Clarence Decatur Howe: That inquiry is in hand, through the British purchasing board and the Canadian Department of Munitions and Supply. Certain investigations are being made to that end.


Victor Quelch: I may have misunderstood the minister who has just spoken, but in reply to the hon. member for Vancouver South (Mr. Green) I understood him to say the reason why we were giving orders to larger factories rather than smaller ones was that the former were more efficient. Surely at this stage we should be utilizing the services of every factory in the dominion, large and small, and all the shops. It should not be a question of which factory is more efficient. If a smaller factory is not properly equipped, it could be remodeled to produce to the maximum. The Prime Minister (Mr. Mackenzie King) assured the house that our production must be accelerated to the limit-indeed, without limit. I would ask the minister this question: Does he consider that we are at the present time increasing our production of the required needs to the maximum rate possible? If not, why not?


Clarence Decatur Howe: Speaking for the Department of Munitions and Supply, we are filling all requisitions as expeditiously as we can. We have heard no complaints that we are not meeting the requirements of the services both here and in Britain to the extent that they are made known to us. We use as many factories as we can, to obtain the production that we require to obtain. It is hardly fair to say
that we are favouring the larger shop against the smaller. If there is a well equipped small shop, I think it is busy on production; but there are large shops not properly equipped for our purpose, which are not busy, just as there are small shops not properly equipped for our purpose which are not busy. Ours is a job of supply. We are supplying the needs of the services as those needs are indicated to us, and we are doing it to the very best of our ability. As I say, the situation of the last week has greatly changed the needs, and we are expanding our production as rapidly as we can. It takes a little time to do that. Sources of supply are needed now that were not needed three weeks ago because we had sources of supply in England. We are, in a word, doing our utmost to meet the requirements of the services as rapidly and as efficiently as we can.


Mr. ROSS (Souris):: The remarks of the
Minister of Transport (Mr. Howe) have been most startling, and following them up I would ask the Minister of National Defence (Mr. Rogers) this question:	Is it a fact that we
have in the second division militia regiments transformed into a tank corps which to date have never seen a tank for purposes of training in this country?


Norman McLeod Rogers: Owing to the small number of light tanks available, it was not considered possible for maintenance reasons to distribute these tanks among the mobilized and unmobilized mechanized cavalry and tank units in Canada. It was therefore decided to retain these tanks at the Canadian armoured fighting vehicles school at Camp Borden, bringing in as many personnel as possible from the mobilized mechanized cavalry and tank units to Camp Borden for training, and it was proposed that certain tanks would be allotted to these units for all purposes when they were concentrated at Camp Borden.


Herbert Alexander Bruce: I am afraid that the people
of Canada will be very much disturbed when they hear the statement made to-night by the Minister of Transport that no tanks are being made in Canada to-day. I wonder why the tank units are being trained in this country if there are no tanks for them to use after they have finished their training. We have a tank unit in the city of Oshawa, and I understand that it is being trained on a rope.


Norman McLeod Rogers: If my hon. friend will
permit me, there are certain tanks available for training purposes. They are localized at Camp Borden.


William Earl Rowe: How many?
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Herbert Alexander Bruce: There are none in the city
of Oshawa, I believe. Yet we have been told that in the city of Hamilton there are two factories able to produce tanks in a very large way.


Clarence Decatur Howe: I am looking for information. Might I ask who told my hon. friend that?


Richard Burpee Hanson: It does
not make any difference who told him.


Clarence Decatur Howe: He said he was told.


Richard Burpee Hanson: I do not
think the minister has the right to crossexamine the hon. member.


Mr. POULIOT:: Perhaps we can find then
where the leaks come from.


Herbert Alexander Bruce: If the Minister of Transport will read the proceedings of the senate of a few days ago, he will find that a member of that chamber stated that there were two factories in Hamilton, one of which could produce 250 tanks a month.


Clarence Decatur Howe: I will give him a contract if he can do it.


Herbert Alexander Bruce: I do not intend to proceed further with that at the moment.
I am sorry that the Minister of Justice (Mr. Lapointe) is not in his place because the matter to which I wish to refer concerns him. On two occasions since the opening of parliament I have asked for information as to what steps the Minister of Justice was taking to probe and check treasonable or what are now known as " fifth column " activities by various organizations in this country. The only reply the house has received is that the question is being referred to a committee; but so far as I know, no committee of this house has as yet been set up. Since I first asked for information, evidence has accumulated daily tending to show the profound and, indeed, immeasurable importance of the subject. In April we had already learned of how great a part treason had played in Hitler's successful seizure of southern Norway. We have since learned that the resistance of Holland and other countries was handicapped because they were gangrened with treason.
Early in the present war France woke up to the fact that the communist party within her borders, which had done so much to paralyze her preparations to meet the menace of war and invasion, was ipso facto also a pro-nazi organization. Probably the full story of all that treachery has done to create the horrible events which have occurred in northern France since mid-May has not yet been revealed. Subversive activities to strangle all powers of resistance within the nation have been

rampant in Britain and Ireland, and last week were made manifest. We may take it for granted that in Britain and Ireland measures to root out treason and espionage in their nests were not dictated by mere hysteria.
It was realized that the danger from within was as serious as the danger from without.
What I ask this government and the Minister of Justice especially is, whether they are so blind in view of what has been revealed as to suppose that Canada is immune. Those of us who know anything at all about this country know the contrary. We also know that the more expeditiously Canada goes about the business of a more intensified war effort, which we were told by the ministers here during the past few days they intend to do, the greater the danger from within. It is not as though the machinery to promote treason and sabotage did not already exist.
In my own city of Toronto, a whole score of organizations operating under different names but all aiming at the same objective have been at work for years. They have for the most part been affiliated with the communist party, and that is true also of all the larger centres in Canada.
Perhaps because of the peculiar audacity of the communist agitators working under cover, with orders from Moscow, we have paid too little attention to fascist and nazi activities in our midst. A fact which stares us in the face to-day is that ever since last August the ' communist, nazi and fascist elements in Canada have made common cause with each other. Their sole objective is to destroy the British empire by whatever means lie at their hands. We are living in a fool's paradise if we assume that Canada, the premier dominion, a dominion with enormous potentialities for assisting the allies to win the war, is to be excluded from this objective. We Canadians who are still privileged to sleep safely in our beds at night owe a debt to the Royal Canadian Mounted Police and to the other police organizations of this country that we have so far escaped serious incidents.
But in a crisis like the present the government may go too far in relying for security on ordinary police vigilance. Yesterday the hon. member for Peterborough West (Mr. Fraser) gave us an instance which should cause the Minister of Justice to reconsider his former decision to refer the matter to a committee before taking action. It seems incredible to me that a former Geftman soldier, who is still a German national and was in receipt of a pension from the German government to the outbreak of the present war, should be on an unguarded lock, No. 23, of the Trent valley canal. On the Trent valley canal there are

War Appropriation Bill
key dams which, if blown up, would flood the power plants along the lower Trent. The hon. member for Lincoln (Mr. Lockhart) drew the attention of the house to the inadequacy of the protection of our great Welland ship canal and the power plants situated in the Niagara district. This is another place exposed to great risks owing to lack of realization by this government of the menace of the "fifth column" activities.
Let me also relate an episode which occurred in the northeastern suburbs of the city of Toronto on a recent evening. A young man crossing one of our ravines heard the sounds of falling wire, and on investigating found a man sixty feet in the air on a transmission tower busily cutting the high tension wires which carry electric power from the Ottawa valley to the great industries of Toronto. It was an isolated wooded spot, but the young man bravely effected an arrest by himself. When the prisoner was searched and identified, it was found that he carried a membership card in the communist party of Canada, and had been a recipient of relief for ten years. It was obvious that he was no ordinary vagabond, but a skilled mechanic equipped with the requisite tools to carry out very dangerous work. He was serving not Russia, but Germany, in an attempt to disorganize our war effort. It is a fact that in many centres of Canada the individuals who were in the past most active in shouting for the communist cause are now cheering every nazi success in Europe. They are probably hand-in-glove with nazi organizations which have been secretly at work in this country for two or three years.
The Minister of Justice informed the house this afternoon that papers which had been seized on the premises of the fascist party were being examined by the Quebec authorities, and that the attorney general of Quebec would take any necessary action. I am sorry that the Minister of Justice is not in his seat, because I should like to ask him if the attorney general of Quebec has the necessary powers under existing statutes to have the head of this organization arrested and placed in an internment camp. If he has not such authority, will the Minister of Justice take immediate steps to provide not only Quebec but Ontario with the necessary power?
A detailed survey of the activities of the so-called communist party in this dominion during the past twenty years was made in 1938, the year of Munich. At that time a singular change of front in the Canadian communist propaganda was noted-a denial of all connection with Moscow and a refusal to compare Russia with the communist state
which they advocated for Canada. At that time the communist party, with its widely ramified chain of societies, became anti-British and anti-democratic rather than distinctly proRussian. In 1931 direct connection with the third international of Moscow had been proved up to the hilt in the trial of Tim Buck and other officials of the communist party of Canada. The change of attitude was therefore a remarkable development. There is nothing to show whether this policy of repudiation was sincere and actual, but it was abundantly clear that a large following of dupes, which had been built up on promises of a regime in which the proletariat should be supreme was to be turned into an instrument to oppose Great Britain when war should come. The machinery has been built up over a period of years, and is still functioning, but in a less open way. There is little doubt that the men who built up that subversive machine are, as far as lies in their power, servants of Hitler to-day. I am credibly informed that the local authorities of Toronto are actually unaware where the three most prominent of local communist politicians are to be found to-day. They are Tim Buck, Stewart Smith, and a Mr. Salzberg, all of whom have been active as municipal and provincial candidates in the past, and they are mysteriously absent from their accustomed haunts.
For years right-thinking people in many industrial centres have been worried over conspiratorial efforts to corrupt the children and young people of Canada as well as the working classes with the virus of hatred against our Christian traditions and ideals of democratic government. Let me give a partial list of the organizations which have been formed at various times to accomplish this end:
The Young Communist League.
The National Children's Council.
The Student League of Canada.
The Workers' Theatre Movement.
Various organizations of the unemployed.
The Canada-Labour Defence League.
The Workers Unity League.
The Canadian League Against War and Fascism.
The Friends of the Soviet Union.
The Independent Mutual Federation.
The Student League for Social Reconstruction.
And in addition, various organizations of foreign immigrants in which social entertainment has been a disguise for anti-British or, as they prefer to call it, anti-imperialist propaganda.
There have also been efforts, not so successful, to spread anti-British poison in exservicemen's organizations. Interlocking directorates figure in the records of many of
War Appropriation Bill

these organizations. To prepare their numbers for class warfare rather than for the redistribution of this world's goods was certainly the aim of all these organizations. For instance, the manifesto of the Student League of Canada issued in November, 1932, stated:
The Student League of Canada presents a programme of active participation in the class struggle based upon a scientific analysis of the course of social development.
It therefore proposed to combat uncompromisingly the leadership and policies of those organizations which, consciously or unconsciously, delude the student by fostering reformist hopes and democratic illusions.
The assault on democracy, later so familiar a tenet of nazism and fascism, was already being promulgated in Canada at the time when Hitler rose to power. Even more outspoken was the speech delivered on March 2, 1935, by Tom Ewen, national secretary of the Workers Unity League, at a meeting under the auspices of the Student Peace Movement. On this occasion not peace but civil war was preached. Mr. Ewen said:
In order to root out the causes of war, we must do away with the capitalist system. Communists are not pacifists, and if war breaks out we will turn the imperialist war into the civil war in order to abolish the capitalist system and thus remove war causes forever.
It would be tedious to recite the many utterances, all aimed at overturning our governmental system by any measures available, that have been heard in the gatherings of the various organizations I have named, and I have no intention of doing so. They were constantly heard in Canada during the years when Hitler was preparing to attack democratic civilization and paving the way to an understanding with Russia. I have quoted two different utterances to show how well the ground had been prepared in the way of subversive sentiment in this country prior to the outbreak of war. Canadian youth were taught to accept as an ally any enemy who sought to destroy the British commonwealth of nations. Hitler, let me again point out, found ready to his hand in these organizations a vastly ramified subversive machine to supplement the work of his own underground agencies in Canada. The nucleus of that machine still exists, and although during the past eight months it has been driven underground, it is not the less dangerous on that account. Therefore, in all seriousness, I urge this government to take all steps within its power to check subversive activities, which common sense must tell are not the less alive because they are not so apparent as they were to the naked eye. I am certain the Minister of Justice will have the earnest support of every patriotic member of this house in anv measure he may devise to meet this situation.

We were encouraged to hear from the Prime Minister yesterday that the crisis with which we are now faced has at last moved the government to action. But what we have every reason to complain about, is something I was going to call complacency, a term to which the government is so sensitive. I will substitute another word. Let me say that what we complain about is the "indifference" that has been so painfully manifest, even during the last niro months since the war broke out, as to Canada's war effort. During this time the government have wasted two months in holding an unnecessary election and nearly two months more in their endeavour to recover from their partisan labours-four months in all when the total energy of every member of the cabinet should have been directed to speeding up Canada's preparation for the spring offensive which the Prime Minister had stated he expected. If any word was ever justified as descriptive of the present government it is the word "indifference." May I congratulate the Minister of National Defence (Mr. Rogers) upon the announcement yesterday of the formation of a fourth division. I was disappointed, however, when it was followed by the statement that at present he would recruit only 7,000 men for the formation of a rifle battalion for this division.


Norman McLeod Rogers: I believe I said that we would recruit all the rifle regiments of a fourth division, which would be nine rifle regiments.


Herbert Alexander Bruce: How many-9,000?


Norman McLeod Rogers: Pretty close to 9,000.


Herbert Alexander Bruce: Well, I will change my figure.
I thank the minister for the correction. He will recruit only 9,000 for the formation of rifle battalions for this division. It is a little better than I thought, but may I urge upon him that complete plans be immediately formulated for the development not of four divisions but of six divisions in Canada.
These are not ordinary times. Canada and the British empire are facing the greatest crisis in our history, and surely there can be no two opinions as to the urgent and imperative necessity of bringing together in one cooperative government the best- brains that are to be found in the country, whether inside or outside this house, for the purpose of enabling Canada to put forth its maximum effort with the sole object in view of helping to win this war. Until this is brought about, nothing else matters. Is it right, in the face of such danger as confronts us, to have battling for political position going on, when our very parliamentary institutions are endangered?
I come now to a part of my remarks which is going to be very distasteful to me.

War Appropriation BUI
I have been a friend of the Prime Minister of Canada for many years and have admired his many excellent qualities. He was prepared, as few in this country have ever been, by long years of education and training in statecraft for public life. He is a man of high character, a man of peace. I wonder whether these qualities, which are so admirable in times of peace, are not the very qualities which disqualify him now in time of war.


Some hon. MEMBERS:: No, no.


An hon. MEMBER:: Shame.


Herbert Alexander Bruce: The Prime Minister's
Asquithian attitude of "wait and see", or in other words, let public opinion become crystallized and then follow it, may have been good statecraft for a virile people in ordinary peace times, but it is not the attitude for war time.


Mr. GRANT:: He was elected in war time.


Herbert Alexander Bruce: It is now absolutely imperative that we have a man of action who will lead public opinion instead of following it. This man must have a strong and forceful character, must be one who will not be influenced by personal or private considerations, and will be ready to brush aside red tape and all other obstacles in the way of quick and decisive action. Last evening we had an illustration of party loyalty on the part of the Minister of Finance which was most commendable. When I listened to him I could not help the reflection that history may repeat itself and that what has happened in the mother country might with advantage happen here. The Minister of Finance enjoys the respect and confidence of both sides of this house, as well as that of the people of Canada generally. With his splendid war record, his undoubted ability in finance and law, his well known driving force and character, may I venture to suggest that he is the one man in the Prime Minister's cabinet-


Mr. MARTIN:: You are trying to undermine him.


Herbert Alexander Bruce: -qualified and equipped to lead a war government. The Prime Minister of the United Kingdom was changed in spite of the fact that Mr. Chamberlain had very strong support in the House of Commons, 418 supporters as against the combined Liberal and Labour strength of 197, but he was forced by pressure of public opinion to hand over the seals of office to Mr. Churchill, a man of great energy and ability in whom the people had confidence. May I briefly recall to members of this committee what happened on that memorable occasion.


Thomas Vien: May I draw the attention of the hon. member to standing order 58, section 2, which provides that:
Speeches in committee of the whole house must be strictly relevant to the item or clause under consideration.


Thomas Langton Church: The Prime Minister did
the same thing.


Thomas Vien: The item under consideration is an appropriation. I do not believe that the speech of the hon. member is relevant.


Jean-François Pouliot: I rise to a point of order in defence of the hon. gentleman.


Thomas Vien: The hon. gentleman may speak to the point of order already raised, but he cannot raise another one until this one is disposed of.


Jean-François Pouliot: Then I will appeal from your ruling to the Chair. And I will put it in writing if I have not the right to be heard. My point is that this bill is for an appropriation. We do not know whether that appropriation will be spent by this government or by a government suggested by the hon. gentleman. Therefore the hon. member is perfectly in order in continuing his argument, and I also shall be in order when I answer him.


Herbert Alexander Bruce: I thank the hon. member for Temiscouata for his remarks. He voiced what I had thought of saying. We are considering the appropriation of a very large sum of money to be expended by this government as at present constituted. Before I am willing to give my vote as to the expenditure of that money, I wish to raise my voice as I am doing this evening in regard to the matter.


Thomas Vien: I am entirely in the hands of the committee as to the ruling I have just made. This ruling is not debatable. An appeal can be taken to Mr. Speaker. But I was simply drawing the attention of the committee to the rule. If it is the desire of the committee that the hon. member should have leave to carry on, I am in the hands of the committee. But my own judgment is that he is not within the provisions of standing order 58, section 2.


Jean-François Pouliot: Speaking to the point of order-


Thomas Vien: This matter is not debatable.


Jean-François Pouliot: The Chairman has no right
to decide a point of order.


Thomas Vien: Order, please. I have just stated that my decision is not debatable. You can appeal to the Chair if you want to,
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but I was saying that I am in the hands of the committee to determine whether the hon. gentleman should have leave to carry on as he was proceeding to do. In my opinion he is not within the rule.


Thomas Langton Church: I rise to a point of order.
I would ask that the committee rise and ask for the ruling of the chair.


Thomas Vien: The question is not debatable. Is it the pleasure of the committee that the hon. gentleman should have leave to continue?


Some hon. MEMBERS:: No.


Some hon. MEMBERS:: Yes.


Thomas Alexander Crerar: May I say a word at this point? I think there is a basis for the point the Chairman has raised. It occurred to me that the speech the hon. member was making could more properly have been made on second reading of the bill than in committee. But I would make this observation, that a good deal of latitude has been taken in the discussion. I would be the last to wish to curtail anything that the hon. member wishes to say. I would make the suggestion that he be allowed to continue but also that he endeavour, if possible, to keep closer to the section of the bill that is under consideration.


Herbert Alexander Bruce: Mr. Chairman, in spite of the very kind remarks of the Minister of Mines and Resources (Mr. Crerar), I accept the ruling of the chair and shall discontinue my speech at this moment.


An hon. MEMBER:: You cannot take it.


Jean-François Pouliot: Nobody can speak until the matter has been referred to His Honour the Speaker.


Richard Burpee Hanson: I do not know that I am in order, but I think that it would be a pity if the Chairman's ruling were allowed to stand and the hon. member for Parkdale forced to discontinue his speech. I am quite familiar with the rule referred to, but we are debating in committee of the whole section 2 of Bill No. 18, and under that it is wide open to any hon. member to discuss the conduct of the war or the fitness of the men conducting the war. With the greatest respect for the chair I suggest, sir, that you withdraw your ruling.


Thomas Vien: I cannot withdraw the ruling. I have pointed out to the hon. member that, in my opinion, he was transgressing the rule which I have cited. I am in the hands of the committee as to whether the hon. member should have leave to carry on.
[The Chairman.]
The affirmative would be equivalent to a suspension of the rule in favour of the hon. member. If the committee so desires, it can suspend the rule by unanimous consent.


Karl Kenneth Homuth: Does the government dictate the rules of the house, or are the rules in the book?


Thomas Vien: Is it the unanimous consent of the committee that the hon. member should have leave to carry on?


Some hon. MEMBERS:: Go ahead.


Herbert Alexander Bruce: I am a new member of this house. I come from a part of the province in which free speech is welcomed, and I have always been able to say what I think. No one has ever interfered with me in making a speech. I am not going to break a rule of this house after having been here only two weeks; therefore I accept the Chairman's ruling and shall not continue my remarks.


Thomas Vien: I should like to point out to the hon. gentleman that freedom of speech is not involved in this point. We have rules governing our debates; those rules must be obeyed. But in the present case, the hon. gentleman, having the unanimous consent of the committee to continue, he can do so without breaking the rule.


Mr. CHAMBERS:: If the hon. member does not wish to continue, I should like to say a few words. It is a tradition of this house that a new member, when rising to make his maiden speech, shall introduce his remarks by a description of the beauties and natural wealth of that portion of Canada which has elected him. I shall take the responsibility, if I may, of breaking this tradition by saying immediately that at this moment in the world's history all that British Columbia represents to me is a collection of human beings whose liberty and happiness, and, indeed, whose lives, depend upon the events of the next few weeks.
Another tradition is that a new member's whole career may depend upon careful avoidance, in his early days in this house, of anything which savours of a lecture to an assembly of men far more experienced than he may be. At some risk to my future I must set aside this tradition also; for nothing could be of less importance to me at this moment than the question of my own political future. If I have any right to stand here to-day, it is as one of the 245 men and women in whom eleven million men and women have placed their trust to bring to the affairs of the country wise guidance while civilization is on the brink of disaster.

War Appropriation Bill
The verdict to which we must subject our* selves is that of history. I stand with thit rest of this house on trial before all the generations which will succeed us. If at this time we let them down, we must go down in history as those who failed in their duty. For this reason I venture to say to you, sir, that the time has long passed for members of this house to remember the ancient divisions which have separated them, the question of what language they learned at their mothers' knees or the accident of their place of birth, and to remember only that to-day they stand facing a nation in peril of destruction and not likely to be tolerant of such human weaknesses.
Since the beginning of this, my first session in this house, I have heard no small amount of discussion as to where the blame must lie for the fact that this country faces the greatest of all crises in its history not fully prepared. The time has come, Mr. Chairman- and I say this with all respect to the veteran members of this house-to put an end to this form of argument. It will be of no concern to the people of this country to know who are the guilty. It will be of no concern to them to ascertain whether the responsibility lies here or elsewhere. It will be of no concern to anyone to be able to say that he was wiser than another. All that will concern the peopre of Canada will be whether from this moment forward the service of the state is conducted with all the vigour and efficiency of which the members of this parliament and the servants of the crown are capable. It will not even concern the people of this country whether the decisions which so far have been taken were right or wrong. It will concern them only to know that the decisions we make from now on are right.
If I may be permitted to say one more word, it is that I feel deeply that there lies upon me heavy blame for my failure up to this moment to exhibit a full appreciation of my duty to serve the nation with the greatest courage and skill I can put forward. There may be others in all parts of this house who have the same conviction. It is not for me to judge the others. It is my duty to say to you, sir, that I am prepared to accept my full share of any blame which may attach for past failures, and that I am prepared to accept any amount of criticism, be it fair or unfair, provided only that the criticism is not made at the expense of the rapid and efficient functioning of the machinery of the state.
I should like to record the fact that what moves me to say these things is my realization of the verdict which the people of Canada of to-day, and particularly those of to-morrow, will pass. I hope, sir, that this will be my
only formal contribution to the debates of this house this session. I propose to support the measure to which I am speaking at the moment, with full appreciation of the fact that the steps contemplated are not perhaps fully sufficient for the needs of the times and that they must be executed with something slightly less than perfection. All I can hope is that every member of the house will feel in his inmost soul the humility which I feel as to our inability to give the nation completely the service which it so sorely needs. I believe that only if this spirit imbues us all and directs our every word and action, shall we rise to meet the problems which confront us and serve, as we should, in the present struggle to save the world from destruction.


Mr. ADAMSON:: Unfortunately I was in the lobby this afternoon when the Minister of National Defence (Mr. Rogers) referred to some questions I asked last night. The minister said it was not in the public interest to disclose the information I requested. I appreciate the position of the minister; but in view of the very grave unrest in regard to the Bren gun production, I wonder whether he would give to the leader of the opposition, to myself or to some other member the information in his possession so that we may be able to allay the fears and the very great dissatisfaction of the Canadian people in general, and those of my own riding in particular, with regard to the present situation. I quite understand that the matter of the production of munitions may be considered confidential, but it would help if we could say that the information given us by the government was satisfactory. Perhaps the members of the opposition who served in the last war are more anxious to be able to do that than to do anything else. If the minister could give my leader in confidence any information which would permit us to say that things were not as bad as rumour has them, I think it would be a great contribution to the peace of mind of the Canadian people.
I should now like to say a word with regard to Colonel Carter, Mr. Everett Bristol and Colonel Worthington. I believe that before war broke out, Colonel Carter was the foremost British expert on armoured fighting vehicles, tanks and mechanized warfare generally. He came out here purely unofficially and in an advisory capacity, I believe. And he with Colonel Worthington, who is a brilliant tank officer, discussed the possibility of producing tanks in Canada. Among his findings were these-and I have not his exact words, because he wrote a number of articles on tanks or mechanized warfare. He said-


Paul Joseph James Martin: Who wrote it?
War Appropriation Bill


Agar Rodney Adamson: Colonel Carter. He said that we in Canada had some of the finest possible material in the empire for tank troops, and he hoped that we would take advantage of that not only because we have this wonderful material in our northern logger, in our men who drive tank trains and other heavy transports, but because we have in Canada those wonderful potential assets which should be developed. He brought the matter up in the public press, and to the attention of Colonel Worthington, who entirely concurred in the argument. It was also called to 'the attention of General McNaughton. That is the situation with regard to Colonel Carter.
The subsequent situation was this, either that the government would not or could not act quickly enough. In any event a public charity was formed to train the troops in Camp Borden under Colonel Worthington, and Mr. Everett Bristol was in some way responsible for the fund being organized. I might say that some of the most responsible people in the city of Toronto were connected with that fund. Colonel Carter mentioned in his series of reports that we had a very great asset not only in our man-power but in our industry in Canada, and he suggested that we could produce armoured fighting vehicles in Canada in great numbers.
I understand this was not an official representation of the British government, but certainly it was a representation from Mr. Everett Bristol to the dominion government. In my opinion the unfortunate part of it is that it was an opportunity which was missed.
I am going to ask the Minister of Munitions and Supply one or two questions about aeroplane production. I have observed that last week at Malton-on the 21st of the month- there were over $2,000,000 worth of aeroplanes stored in the hangars of the Associated Aircraft Corporation. These included nine bombers valued at $150,000 each. I believe they were Douglas and Lockheed bombers. Then there were over eighty ab initio, that is initial Fleet or deHavilland training planes in the hangars, waiting for acceptance by the government. They have been there for a considerable period of time-some of them for months. The government in my opinion should explain why those aeroplanes were kept in the hangars on their noses, turned up in storage at Malton for all that time. The production of aeroplanes in Canada is a matter which faces us now in a most realistic manner. I would suggest to the Minister of Munitions and Supply and the Minister of National Defence one thing, and that is .that we are an American nation.

I was educated in England as a mechanical engineer, and I understand the difficulties of trying to produce aeroplanes in Canada to English specifications. We have our automotive industry, and all our shop practice is based on American standards. The American Society of Automotive Engineers (S.A.E.) and the American Society for Testing Materials (A.S.T.M.) lay down our standards for us. It is not helpful for us to attempt to produce aeroplanes on an English standard. Nobody appreciates that more than I do, because I have studied in England and have worked in Canada. I would suggest that to-day our problem is that of production of aircraft. Nothing else matters. What is gone before is of comparatively little importance to-day, when the whole of civilization is falling about our ears. Let us get on with the job of producing these aircraft, using what standards we can and any methods we can, so that we can give the greatest assistance not to the empire, not to the allies, but to civilization itself. That is the thought I bring to the attention of the minister.
We in Canada are very short of machine tools and machine tool equipment. The machine tool industry is the one industry to-day on the north American continent that is overworked, because there is a tremendous scarcity of the product of that industry. If to-night the government would get in touch with the priority officer in Washington, who is known to me, I am quite satisfied that a sufficient number of machine tools would be released for the Canadian government to produce these jigs, dies and other things necessary to set up our aircraft industry or to begin the industry on a national American basis. We have to work with our co-partner on this continent.
I suggest to the Minister of National Defence that something should be done about this. In this instance, time is of the essence of the contract. I would not be taking up the time of the committee if I did not believe that some really helpful and concrete action could be taken along these lines.


Norman McLeod Rogers: I should like to thank my hon. friend for some of the suggestions he has made. May I say something to him regarding his statement concerning the production of Bren guns. He has referred to a grave unrest arising from certain rumours which he has heard regarding the Bren gun. May I say to him now, in the light of the statement I made this afternoon, that I know of no cause whatever for grave unrest with respect to the production of Bren guns. On the contrary, we anticipate that delivery will be well in advance of schedule. A certain modification

War Appropriation Bill
has to be made, in the same manner in which it is being made in England. This is being proceeded with as quickly as possible.
And even at the risk of hon. members charging me with a desire to contract discussions in the house, may I suggest that questions ought not to be put in this chamber in such a manner as would appear to give substance to idle rumours which, of themselves, cause unrest at a time when, above all else, this country needs steadiness. I do not think that we can overemphasize the importance of steadiness in this house. It is in a time of crisis that we realize just how thin is the crust that separates us from a feeling of alarm which sometimes borders on hysteria. I am thankful to say that throughout this country we can put our faith in the steadiness of our people at this time despite the distressing news that is coming to us day by day. But I suggest that this house should give a lead to the country in maintaining faith and confidence.


Agar Rodney Adamson: May I say to the Minister of National Defence that it was merely in order that he should give such a lead that any words of mine have been spoken in this house; if the minister could assure us in this house to-night that the production of Bren guns, the production of artillery, the production of shells and the production of munitions of every kind was satisfactory, nobody would cheer more enthusiastically or. be more delighted than I, and I believe every member on this side of the house feels as I do.


Clarence Decatur Howe: May I reply to one other part of the last speaker's address. The government is well aware that in the production of planes it is simpler for Canadian industry to follow American methods. Nevertheless it must be kept in mind that Britain and Canada are in the war as partners, and the principal effort of Canada to date has been to reinforce the effort of Britain in Great Britain and in France. That has led us to cooperate with Britain in building the type of plane that Britain is using. The factor of interchangeability is sometimes of tremendous importance in war equipment, and the fact that these planes go into aerodromes in the battle area where suitable repair parts are immediately available, is important. However, we are woiking on American standards where we can. We find United States aeroplanes are simpler to build, and we can get better support for our industry in the United States.
May I say to my hon. friend that we have a representative of the Canadian government at Washington who is charged with looking after priority in the matter of machine tools. We have, however, a satisfactory production
of machine tools in Canada, and it is growing steadily; most of our factories are tooled with machine tools made in Canada. I just wish to point out that we have not overlooked the American sources of supply or the fact that American standards are simpler for us to work to. Nevertheless we have followed the British plane production, for the reason that we thought by so doing we could in this particular situation render more valuable service.
I should like to say a word about the suggestion that two factories in Hamilton can turn out 200 or 250 tanks a month. I doubt if many people understand the problems involved in building a tank. There is no industry in Canada that could of itself build a tank in an}rthing like six months. The production of tanks even in a great country with the reserves of the United States is amazingly small, as statements from United States army engineers, made public, will indicate. I may say at once that the particular tank we were looking at was plated with armour plate four and a quarter inches thick of a particular type of resistant steel made in only one or two places in the British empire, and there are only one or two sources of supply in the United States. The type of engine is of a larger size than has ever been produced in Canada. Every country has had tremendous difficulties in the engineering of tanks, and the problem of building tanks is one that will challenge the whole industry of Canada, even if we had certain assistance from other countries that is not presently available. So when a man stands up and makes reckless statements about two firms in Hamilton that can build tanks with great speed, I think it is time that the facts were made known to the house and to the people of Canada, in the hope that statements of that kind will not recklessly be made.


Richard Burpee Hanson: Is it not true, Mr. Chairman, that the Canadian Pacific Railway were quite willing to make tanks at the Angus shops, and is it not true that for six weeks they have been waiting for instructions to proceed, but have not proceeded on account of the circumstances mentioned by the minister this afternoon, which I do not doubt is the case? Is it not also true that the National Steel Car of Hamilton are prepared to undertake the construction of tanks?


Clarence Decatur Howe: To the best of my knowledge and belief the latter part of that statement is not true. The Canadian Pacific Railway were quite willing to undertake the work, knowing they would have to import certain parts of the tank, the engine, armour plate and certain other parts. There were certain
War Appropriation Bill

parts which could be made by the Canadian Pacific Railway shops, and I suppose no plant in Canada is better equipped to manufacture them than the Angus shops, and probably Canadian Locomotive and Kingston Locomotive shops come next. But to suggest that a [DOT]tank may be completely built in a car building plant is going beyond anything that makes sense.


Mr. MacKINNON (Kootenay East):: Mr. Chairman, there is in session at the present time in the city of Femie, British Columbia, the associated boards of trade of eastern British Columbia, and I received a telegram from the secretary of the association this morning enclosing a resolution passed at yesterday's session which I should like to read to the committee. It is as follows:
Whereas it has been held desirable by our dominion government that tourist traffic into Canada be encouraged to the utmost, and Whereas such traffic unregulated would permit the unobserved entry of spies, saboteurs and other undesirable agents, and Whereas there are in Canada numerous strategic points and key industries vital to the well-being of our communities, the economic life of the nation, the empire and to the uccessful conduct of the war, and Whereas facilities for the control of un-.dentified visitors and the guarding of such strategic points and industries are at present insufficient and ineffective.
Therefore be it resolved:
(1)	That the dominion and provincial governments be asked forthwith to inaugurate a system of closed areas surrounding such strategic points and vital industries within which entry may be had only by authorized persons for specified and authorized purposes.
(2)	That such governments be advised that a serious and dangerous condition exists at border points and that they be urged forthwith to organize an effective home guard for protection of such strategic points and vital industries that sabotage may not be possible.
(3)	That the dominion government be asked to create a fully efficient control of the entry of persons into Canada by the addition of inspecting personnel in sufficient numbers.
J. R. Hunter,
Secretary,
Associated Boards of Trade of Eastern British Columbia.


[Stage Direction]
Section agreed to.
On section 5-Orders and regulations.
Mr. POTTIER:: Before section 5 carries, would the minister consider adding the word "ship" to paragraph (c)? There is in this measure power to take over practically everything except ships; that is, to "acquire lands, buildings, equipment, stores, materials and supplies." Suppose we wanted ships to add to our merchant marine, not naval ships, I

know of nothing in the bill which gives us that power; yet it might well be that in carrying on our war effort or in looking after the transportation of commodities we would need to spend some of this money to charter or acquire ships. I suggest that the minister consider adding the word "ships" before the word "equipment." I think it would clarify section 2 in that regard.


James Layton Ralston: My hon. friend is referring to paragraph (d) of section 5?


Vincent-Joseph Pottier: Yes.


James Layton Ralston: With due respect to him I do not think that this is the place for the insertion of the word "ships," having in mind what his object is. This is for the purpose of enabling the governor in council to make regulations giving him unquestioned control over equipment. It was felt that there might be a risk of one department getting a monopoly of certain kinds of equipment. The idea was that the governor in council might distribute it among the departments. It really has nothing to do with the objects of the bill, which are, as my hon. friend knows, contained in section 2, namely the provision of money for "the conduct of naval, military and air operations"; "the security, defence, peace, order and welfare of Canada"; "promoting the continuance of trade, industry and business communications", and "the carrying out of any measure' deemed necessary or advisable by the governor in council in consequence of the existence of a state of war." I assure my hon. friend that the utilization, control, acquisition and building of ships is fully covered by the provisions of section 2. If he will look at the explanatory notes opposite page 2 he will find, under "naval services," "acquisition, construction and repairs of ships."


Mr. STIRLING:: Has the minister discovered any good reason for the inclusion of paragraph (b)?


James Layton Ralston: Not a very good reason, but at least a reason. As a matter of fact, I unintentionally .misled the committee last night when I told them that this clause was in the 1915 act. It was not. The clause was drawn by one of the departmental officials and then was inserted with the idea that possibly there might be auxiliary units not within the scope of the military, the naval or the aeronautics act, the pay and allowances for which might not be provided for. That is why the paragraph was put in. As my hon. friend knows, the Militia Act provides for pay and allowances for the militia, and the Naval Services Act for the navy, and there

War Appropriation Bill
will be a new act for the air force. But it was thought that there might be auxiliary units of some kind which would not be otherwise covered.


Grote Stirling: The minister is not
apprehensive that having it in two statutes might induce a sense of confusion?


James Layton Ralston: No, I think not. It is only an authorization to the governor in council to provide pay and allowances, and it seems to me that being there twice would merely provide double authority.


Mr. BROOKS:: I am glad to see that
the Minister of National Defence for Air has come into the chamber. There was a question I wished to ask with reference to Canadian airmen who are with the Royal Air Force. I am sure that we all listened with much pleasure to the statement of the Minister of National Defence (Mr. Rogers) when he told the other day of visiting these men in England, and of how the Canadians who had gone overseas in the last two years had been collected in a squadron under the Royal Air Force. These men, as we all know, found it impossible to get their training in Canada. Coming from all parts of Canada, they paid their way across the ocean and were trained by the British air force. I wish to know whether it is the intention of the minister's department to take over from the Royal Air Force the Canadian airmen who are at present in that air force; or, if these men are not taken over, whether they will receive the same pay and allowances as Canadian airmen under the Royal Canadian Air Force, or will they continue to receive the same rate of pay as the Royal Air Force? I thought it possible that these questions might appropriately come under paragraph (b) of section 5 of this bill.


Mr. POWER:: I am quite sure that, in view of the fact that these men are members of the Royal Air Force, they will receive the pay of the Royal Air Force, not of the Royal Canadian Air Force.


Alfred Johnson Brooks: Is it the intention of the Royal Canadian Air Force to have these men join that force later on? They are all Canadians, and the only reason why they are with the Royal Air Force at the present time is that they could not get opportunities to train here in Canada and had to go to England at their own expense to train. I understand that the pay in the Royal Air Force is not as high as in the Royal Canadian Air Force. I think these men should, if they wish, be given an opportunity to belong to the Royal Canadian Air Force.


Charles Gavan Power: I cannot see any particular reason why they would not be transferred to the Royal Canadian Air Force if they so wished. I do not think that matter has ever been considered. They are members of the Royal Air Force, and we have never seriously considered taking them away and incorporating them in the Royal Canadian Air Force. However, I will make inquiries and give the matter consideration.


James Layton Ralston: The leader of the opposition asked me before six o'clock for some further particulars with regard to expenditures. I have had the officials of the comptroller of the treasury make the collocation of expenditures, and hon. members can follow these expenditures by looking at the explanatory notes opposite pages 2 and 3 of the bill. What has been done is to collect, under headings similar to those shown in the explanatory notes opposite page 3, under "general administration," items of expenditure from September 1, 1939, to March 31, 1940:
Civilian personnel-salaries and
wages	$456,248	99Pay and allowances	
95,358	01Transportation	
40,731	61Operating expenses of properties..	4,341	62Construction and repairs	
116,296	02Stores, equipment and supplies.	..	110,285	60Sundries	
14,662	99Total	$837,924 84
That is the total for that combination of items.
That is under general administration. If hon. members will turn back to the explanatory notes opposite page 2, and begin at the top with "militia services," I can give them the expenditures under the items which are set out there. The expenditures are from September 1, 1939, to the end of the fiscal year, as follows:
Expenditure September 1, 1939, to the end
of the fiscal year from war appropriation, militia services:
Civilian personnel-salaries and
wages	$	918,011 42
Pay and allowances C.A.S.F. and
other personnel charges	
37,090.498	24Non-permanent active militia ..	856,579	44Construction, repairs and operating expenses of military buildings, works and lands. . ..	8,644,840	54
Transportation and food supplies 5,374,341 15 Stores and equipment - unit equipment, personal equipment
and ammunition	
14,439,883	34Sundries	
443,413	02

Note.-Expenditures for Royal Military College and Northwest Territories radio service not segregated as expenditures merged in above headings.
War Appropriation Bill

Expenditure September 1, 1939, to the end of the fiscal year from war appropriation, naval service:
Civilian personnel-salaries and
wages	$	131,593 81Pay and allowances R.C.N. and other personnel	charges..	..	4,108,043	38Acquisition construction and repairs of ships	
1,696,860	17Construction, repairs and operating expenses of naval buildings, works and	lands	
896,644	88Transportation	
219,479	73Naval stores, armament equipment and food	supplies..	..	4,273,999	39Sundries	
146,465	69


Grote Stirling: Does ammunition come into that?


James Layton Ralston: I cannot tell. I should think it would be in naval stores.
Expenditure September 1, 1939, to end of the fiscal year from war appropriation air services, including air training plan:
Civilian personnel-salaries and
wages	$	304,009 80
Pay and allowances R.C.A.F. and
attached personnel	
6,633,036	52Transportation	
491,958	48Operating expenses of	properties 442,524	31Construction of R.C.A.F. and B.C. air training plan buildings, works and lands	
5,073,378	64Stores, equipment and food supplies	
19,163,947	77Sundries	
432,493	91

There is one other set of figures here, but I have not the break-down that my hon. friend asked for. I refer to the commitments. What I have given the committee so far is the actual money paid out. With respect to commitments, I can give them only broken down into the three services. The first item under this statement, which is a summary of commitments recorded during the period from September 1, 1939, to March 31, 1940, is military services, 373,247,674.


Karl Kenneth Homuth: Is that inclusive of the figure the minister gave a little while ago?


James Layton Ralston: It is partly included, because that item is only stores, material and construction and does not include pay and allowances which I give further down. I give the statement now:
Summary of commitments recorded during period, September 1, 1939, to March 31, 1940, against war appropriation for stores, material and construction.
Military services	$ 73,247,674
Internment operations	 149,850
Naval services	 71,387,551
Air services	 60,776,960
B.C. air training	plan	 61,525,214

Actual expenditures made to March 31 for pay and allowances, travel, office expenses, etc.
Military	$ 45,296,616
Internment	 77,260
Naval	 4,682|l80
Air	 7,519,810
Air training	 984,762
Administrative	 502,306
Censoring	 98,765

Total expenditures and commitments, September 1, 1939, to March 31, 1940	$326,248,948
This does not include commitments which may have been entered into by the Canadian military authorities overseas for stores and equipment, as these figures are not available.
The total actual expenditures made from September 1, 1939, to close of fiscal year, March 31, 1940, for national defence war services wras $112,469,000 Deducting this from the total of expenditures and commitments to March 31	 326,248,948
Leaves unliquidated commitments
as of that date of	$213,779,948


Grote Stirling: Making a very rough deduction, taking the $326,000,000 from the $700,000,000 under this bill, we have approximately $400,000,000. Is the minister going to be able to give us any break-down of that, any explanation as to how it will be used?


James Layton Ralston: It is a little difficult for one to explain it clearly. This represents $326,000,000 in commitments made to March 31. For the first year of the war we still have the months of May, June, July and August, or four months more. When our first programme was announced, I calculated that the expenditure would be something like $375,000,000 for the year; as a matter of fact, I said a million dollars a day. That estimate has been exceeded in a good many ways by additions which have been made from time to time. I mentioned one item the other day, increase in personnel of rifle battalions, $5,000,000 and so on. But there were additions to that, when one came to figure the fiscal year from March 31, 1940, to March 31, 1941. There had to be added to the $375,000,000 about $40,000,000 more on account of the air training plan and about $60,000,000 more on account of naval service. The naval service was something in the vicinity of $40,000,000, and we now estimate about $100,000,000. That brought it to a little over $500,000,000.
Then there were other increases, the largest being to send the second division overseas, amounting to about $43,000,000, and other increases that brought it to between $560,000,000 and $570,000,000. Add to that the cost

War Appropriation Bill
of the Canadian corps, something like 865,000,000, and the third division, another $38,000,000, and that brings it nearly to the $700,000,000 without any allowance for other departments. As I have said, those estimates for the cost of the different units depend on the theatre in which they serve and the amount of wastage there is. That is how, without my notes, I reconcile the amount of this bill with the amount of the expenditures and commitments up to date.


Richard Burpee Hanson: I am
greatly obliged to the minister for the trouble he has taken in giving this break-down, but I am sorry it came so late because there will be no opportunity to make any study of the figures in time to base any questions on them with respect to this measure.


James Layton Ralston: I had intended to hand them to my hon. friend immediately after eight o'clock; then something started up, and as hon. members know, a good deal of discussion has been going on this evening, which, it seemed to me, had not a great deal to do with the bill before us.


Richard Burpee Hanson: I am not finding any fault.


Mr. ESLING:: In connection with the recruiting of the third and subsequent divisions, may I ask the interest of the Minister of National Defence in connection with regulations covering pay and allowances? In my district there was no difficulty so far as the wife was concerned, but there was an obstacle causing much distress in connection with allowances for mothers. It seems that such allowances were not granted until a report was received by the department from one who was designated by the pay and allowances board as a special interviewer. The regulations were amended early in the year, I think after the first division had gone overseas. When I communicated with the department and asked who was the special interviewer in connection with the 109th battery, I was told that he was the commanding officer of that unit or any other officer not below the rank of captain. With that unit overseas, it will readily be seen what situation arises.
I suggested to the minister by letter and telegram that, to overcome delay and distress of mothers who were affected, the provincial government agents in that district, both of whom have served overseas and are men of experience and well able to pass upon the financial condition of the mothers, be used as interviewers. It seems that the department has been using the services of a social worker. Well, the mothers are entitled to the allowance, and the social welfare worker cannot very well cover a district some two hundred miles square, whereas the government agents are always available. I ask the minister, in view of the fact that this amendment came into effect after the 109th battery had gone overseas, if he will see that some arrangement is made so that the report, if required, can be made eitheT by the government agent or, say, by the secretary of the local legion, either of whom can reach the mothers quickly.


James Layton Ralston: I am very sorry; I thought my colleague the Minister of National Defence was sitting here listening to my hon. friend, and I confess I did not catch clearly the particular case to which the hon. member was referring. Will he take my assurance that I will refer it to the Minister of National Defence along with the other cases that have been mentioned?


Richard Burpee Hanson: Before this section and the bill pass, I should like to refer to an order in council, a copy of which has come to my desk to-day, P.C. 2189, passed May 24, 1940. This vests in the Minister of Munitions and Supply the most extraordinary powers ever vested in any man in the history of this country. I shall not read the whole order, but I shall refer to one of the recitals and then to two or three portions of the enacting clauses. This is one of the recitals:
And whereas the Minister of Munitions and Supply reports that it is a matter of urgency and of national importance that all possible steps be taken to ensure an adequate supply of certain materials and commodities for the production of munitions of war and supplies and that unless such supply is ensured immediately there is a serious risk that a sufficient quantity thereof will not be available at a later date or that the price for such quantity as can later be obtained will be substantially in excess of that now prevailing; that it is impracticable and not in the public interest to call for tenders; and that to disturb the market price as little as possible, purchases and sales should not be made through an ostensible government source;
And then by paragraph (a) the minister is authorized:
(a) to acquire at such price or prices as he may from time to time decide, such quantities of materials or commodities, raw or manufactured, as he may consider necessary or expedient for the production of munitions of war and supplies, and for that purpose he be authorized to expend a total sum not exceeding $5,000,000.
(d) to enter into agreements with such company or companies as the Minister of Munitions and Supply may cause to be incorporated whereby such company or companies will act as his agent or agents to acquire, dispose of, mortgage and generally deal in all or any such materials or commodities.
War Appropriation Bill

Then there is a further recital:
And whereas the Minister of Finance and the Minister of Munitions and Supply represent that, in order to carry out the terms of this order, it may be desirable to observe commercial financing practices associated with_ like purchases and sales by importers, commission agents and manufacturers;
Now therefore His Excellency the Administrator in council ... is further pleased to order as follows:-
(a)	The Minister of Munitions and Supply is hereby authorized to mortgage or hypothecate for such amount or amounts as he may from time to time consider desirable either directly or through the medium of such company or companies, all or any of the said materials or commodities.
(b)	The Minister of Finance is hereby authorized to give such guarantees as he may deem necessary to any bank or banks against loss, by reason of the exercise of any of the powers conferred on the Minister of Munitions and Supply herein, provided that the total amount of such guarantees in effect at any one time shall not exceed two million dollars, the Minister of Finance to be entitled to rely upon the certificates of the Minister of Munitions and Supply, as to the name of any company (the account of which with any such bank the Minister of Finance is being asked to guarantee) and that such company is beneficially owned by His Majesty, through ownership by the Minister of Munitions and Supply, as trustee of all its issued shares save and except directors' qualifying shares.
I am sure the minister will agree that this is a most unusual departure in government operation and financing. I pondered this matter to-day, but have not had an opportunity of consulting with anybody on it. I should have liked' an opportunity of talking to the minister about the matter, but I had only a minute with him. If it is not in the public interest that the reason for this order in council should be disclosed, and the minister will say so, I shall not pursue the matter further; but I do hope that if there is no real reason of that kind, we might have some explanation as to why the government is taking this power to create government-owned corporations, and some statement as to the rationality of the whole scheme. I do not want to embarrass the government or hamper its undertakings. I assume that the idea is to speed up war preparations, and of course that is all to the good.


James Layton Ralston: All I desire to say is
that, as the order in council indicates, there are certain commodities which it may be desirable to acquire, and that it is considered in the public interest that they be not acquired, ostensibly at least, for government purposes. Then we have the formation of a corporation, all the shares of which are owned by the Minister of Munitions and Supply, who in turn has to come to the Minister of Finance

before he gets any guarantee. That is the safeguard, if hon. members consider it such: two ministers of the crown have to concur in the giving of the guarantee. One of them holds, in his official capacity, all the shares of the company as agent for the crown.


Thomas Clement (Tommy) Douglas: In paragraph (c) it is provided that the governor in council may prescribe administrative practices with respect to contracts. I wonder if the minister who is acting as Minister of Munitions and Supply would give us some outline of what the administrative practices are with reference to the letting of contracts. As I understood the minister the other evening, there are three classes of contracts; those let by general tender, those let to a select group of contractors, and those which it is found necessary to give to preferred contractors because of some special, secret design or something of the kind, where tenders cannot be called for. Could the minister give the committee any idea, in terms of total value, how the contracts let so far would be divided as among those three categories; and, in the case of the latter category, the basis used for determining the price to be paid? That is, are we still operating on the cost-plus basis with reference to the preferred contractors or, as the minister said the other evening, is there the general margin in that industry? How is that margin arrived at and on what basis?


Clarence Decatur Howe: The method of placing a contract depends somewhat on the time at our disposal. Certain orders are earmarked as necessary for a certain date, as may be determined by the departure of a battalion or the sailing of a ship. In general, I may say that we exercise all the business precautions that time will permit. I should think that probably at least seventy per cent of all our purchases is made by open tender.


Thomas Clement (Tommy) Douglas: Is that in terms of value or in terms of the number of contracts?


Clarence Decatur Howe: I should think in terms of value, at a very rough estimate. I should think perhaps ninety per cent of the transactions are by open tender. Then we may have a contract to let for something in which we know certain people are interested. For instance, we know that certain firms are interested in particular textiles, and when an invitation to tender is sent out, it goes to certain firms that are interested. That is all our list means to us, that there are certain people qualified to make certain goods, and they have indicated their interest in contracts of this kind.

War Appropriation Bill
That is the way we try to proceed; that is the way we like to proceed. Sometimes, however, the state of an industry is such that it is impossible to get a reasonably competitive tender. In other words, we need the entire capacity of that industry, and in that event there is not much chance of getting a tender. In that situation it is our policy to put in an auditor to determine the position of the firm before the order is taken and the position after the order is completed, and to establish a price which allows the cost of turning out the article plus a modest profit. I can say that five per cent is the usual profit for that sort of work. I think the textiles, the rubber goods and much of the mechanical transport have been priced on a five per cent margin.
Then there is the question of fortifications. The Department of National Defence have pointed out to us, very reasonably, that it is not in the public interest to send out forty or fifty sets of plans for coastal defence fortifications. They would very much prefer that only one contractor be called in. We have compromised with them, and they have agreed that three contractors shall be asked to tender, those three to be very carefully selected, reputable firms which will proceed with reasonable discretion in handling these secret plans.
In reading Hansard, I noticed that a reference was made to one of these contracts, and I think I know the particular contract to which reference was made. In that case we called in three of the largest firms doing that class of work and awarded the contract to the firm submitting the lowest tender. The work was in a rather remote section, and I understand that part of the job was sublet. The statement in Hansard says the entire job was sublet, but that is not at all permissible. We never allow a contractor to assign a contract in toto to another contractor, and we never deal with an agent. We always deal with firms that we believe will be able to do the work, and the contracts are given to firms that in fact do the work. It is not unusual, however, for a contractor to sublet a certain part of a construction job. For example, another contractor may have concrete equipment much closer to the scene than the firm that has the whole contract. The contractor may sublet the concrete work or the sheet metal work. Part of the contract referred to was sublet, and I am making inquiries to ascertain just what was the extent of that subletting. Without having obtained the full facts, however, I feel sure that only a portion of the contract was sublet to a local contractor nearer the scene than the Montreal firm that had the contract.
I can say that where it is possible to call for tenders we do so, and that practice is followed as fully as the circumstances permit. Where time does not allow us to follow that system, we sometimes use established prices; that is, prices that have been established by recent tenders. Where there is no time to call for tenders, we may renew a contract at the price we last paid for the commodity. If we are using the entire output of an industry, we put in auditors to fix a price that will return a reasonable profit; and where secret work is done, we try to get at least three contractors to tender and award the contract to the company with the lowest tender.


Thomas Clement (Tommy) Douglas: I thank the minister for the information. Is the principle of the cost-plus contract still being used in cases where we are taking all the output of an industry? The minister will remember a certain cost-plus contract which came before the last parliament. In that instance the government was responsible for the purchase of certain tools, jigs, dies and so on, and placing them at the disposal of the firm concerned. Is that principle being carried over into contracts?


Clarence Decatur Howe: So far as I know, no cost-plus contract has been awarded in the last eight months. Sometimes when we have had no previous production of an article, we have used what is known as a target-price contract, which is somewhat different from a cost-plus contract. A price is arrived at which is considered reasonable, and a certain margin of profit is fixed. If the contractor can do better, his margin of profit is slightly increased; and if he is not able to do as well as the established price, his margin of profit drops. That is a contract which is widely used. It has a profit incentive in it, and is the next best thing to a fixed-price contract. The target-price contract is the nearest thing we have to what my hon. friend has described as a cost-plus contract.


Mr. COCKERAM:: Would the minister inform the committee whether the Lindsay arsenal is working to capacity, and how many men are employed there at the present time.


Clarence Decatur Howe: Lindsay arsenal is in process of installing machinery. So far as I know, it has not started actual production. I presume the number of men there is the number connected with the installation of the machinery, and the building of auxiliary plant. It is scheduled to start operation on June 15, I am informed.


Alan Cockeram: I see the Minister of National Defence is now in his seat, and I should like to direct a question to him
War Appropriation Bill

respecting the tank problem, which has been discussed to-night. I direct his attention to a statement made by Brigadier Schmidlin in Toronto last fall regarding the Polish campaign. Would the minister consider whether that statement was the kind of statement one would expect from an officer at headquarters responsible for the mechanized forces of Canada. After all, Germany had been very successful in her campaign in Poland, and it does seem to me that the general staff should have gone into the matter more fully than would seem to be indicated by Brigadier Schmidlia's talk in Toronto. If Brigadier Schmidlin could throw the question of tanks so lightly to one side, does the minister not think it is time for a reorganization of the general staff of the militia? I ask that because it must be realized we have a big job to do and responsible men are needed to head the general staff. Those of us who served in the militia right up to date know what that job is. If an officer, responsible for the mechanization of our army, can view events in Poland so lightly, I do not think he is fitted for the position he now holds in the Department of National Defence.


Norman McLeod Rogers: I shall answer first the question respecting the Lindsay arsenal. I can only assure the committee that the Department of National Defence has realized fully the productive possibilities of that arsenal, and the importance of making the greatest possible use of it during the course of this war. Plans are under way to that end, and they will be carried forward without delay.
With respect to the second question raised by the hon. member, I would say that the particular statement attributed to Brigadier Schmidlin was brought to my attention to-day. I find the speech he made w'as given at a meeting of a local association of electrical engineers in Toronto. He has stated to me that the portions of his speech quoted were in fact actual parts of it, but that without the full context they do not give a full picture of his argument, which was based on the hypothesis that both sides were approximately equal in tank and air power.
May I say to the hon. member that Brigadier Schmidlin was at that time director of engineering services. He was not actually in control of the organization of the tank training depot at Camp Borden. It is quite evident that in the course of his remarks at the meeting of the engineering society he did make certain comments respecting the Polish campaign, and that when taken out of their context those comments do not appear to have been borne out by the events of more

recent weeks. But I would remind the hon. member that if all those whose military prophecies of six months ago were to be censured at the present time, they would constitute a very large number. Military officers of very high rank in the armies of all the allied powers would be included. With respect to this matter I would say that so far as the information before me is concerned, I have the distinct impression that the portion of Brigadier Schmidlin's speech which was quoted does not fully reveal the actual tenor of his remarks on that occasion.


Mr. McNEVIN (Victoria, Ont.):: With
respect to the Lindsay arsenal may I say that one hundred men are being employed on production at this plant which has been operating since May 1, 1939.


John Ritchie MacNicol: Producing what?


Thomas Bruce McNevin: Producing [DOT]303 cups, and discs for the production of heavy shells. The installations under way are for the production of heavy shells, and I am most anxious that that development be completed with the least possible delay. However, it would not be correct to say that the plant is not in production.


Angus MacInnis: Is there a fair wage
clause in the various contracts being let, and has the government taken precautions to see that fair wages are paid and that decent working conditions are provided in connection with all contracts let by the government?


Clarence Decatur Howe: The fair wage clause is included in all government contracts for munitions, and the Department of Labour has the same control over those contracts as it has over all others.


Angus MacInnis: Is that the case in connection with other supplies, too? I have in mind contracts let to the textile industry. I believe there is a great deal of textiles being purchased now. As indicated by a royal commission which reported to this House of Commons, wages in the textile industry are extremely low. Is the government taking precautions to see that men and women working on government supplies are not being sweated in that industry.


Clarence Decatur Howe: The rates in textile wages
are covered by contracts and prevailing rates in the industry. May I point out that they are considerably higher now than they were when that royal commission reported, as my hon. friend must know.


Mr. JOHNSTON (Bow River):: Does that same wage requirement apply to manufacturers of aeroplanes and aeroplane parts, too? I understand that it does not.

War Appropriation Bill


Clarence Decatur Howe: I feel quite sure it applies in the aeroplane industry, as well as in all other industries.


Charles Edward Johnston: On several occasions in the last two or three days I have been informed that within this city of Ottawa wages are being paid as low as eight cents, ten cents and twelve cents an hour, and that when these men work three or four months they are laid off and new apprentices put in their places. In that way production costs are reduced; but if that procedure is adopted, we shall never have any development of experienced mechanics. I was hesitant about bringing up the matter; but since it has been raised, I should like the minister to assure the committee that no such wage as that is being paid in any industry where government contracts are let.


Clarence Decatur Howe: I am not familiar with all the circumstances. The important trades allow a certain number of apprentices. I do not know the wages paid, but I shall be glad to look into them.


Charles Edward Johnston: I can give the name of this concern. I have been trying to get a little more information upon it; that is why I delayed bringing up the question.


Mr. McLARTY:: Perhaps I might answer
the question. There are two classes of contracts with different sets of labour conditions. There are what are known as the class (b) conditions in which local wage rates and local labour conditions apply. In other contracts- and this applies to the aeroplane construction industry-minimum wages are set which have been agreed upon in consultation between the contractors and the Department of Labour. These are minimum wages, of course, and if there has been any variation below that minimum wage, I shall be glad to see that the circumstances are looked into.


Charles Edward Johnston: Can the
minister tell us the minimum wage?


Norman Alexander McLarty: The minimum wage
varies so widely in the different mechanical departments of the aeroplane construction industry and the various types of labour employed that I could not from memory give my hon. friend the figures, but I shall be very glad to furnish him with the information.


Charles Edward Johnston: Surely no
industry would pay a married man wages so low as eight or ten or twelve cents an hour; and if that is being done, something should be done about the matter. A man cannot make a decent living at that wage.


Norman Alexander McLarty: I have no hesitation in
assuring my hon. friend that the minimum wage fixed in any contract is far above the figure he mentions. If he will give me information as to the particular company he has in mind, I shall be glad to have an investigation made immediately.


Charles Edward Johnston: I shall be glad to do that.


John Ritchie MacNicol: I should like to ask the Minister of National Defence a question with reference to this sentence which appears in the Windsor Star, entitled "Editor's note." It reads:
A special writer for the Windsor Star, who speaks German fluently, has been mingling with the German population in Detroit and finds there are no less than 7,500 German army reservists in that city, said to be training regularly.
I have no doubt the same kind of thing goes on also in Buffalo, where there is a very large German population. I know the minister is familiar with the situation, and I would ask him if any special precautions have been taken in Windsor, across from Detroit, and on the Niagara falls side across from Buffalo, to prevent serious subversive action by such people as those to whom this dispatch refers.


Norman McLeod Rogers: I can assure my hon. friend that we are taking such precautions as are suggested by the most reliable information we can obtain. We keep constant watch of that situation across Canada.


James Lester Douglas: The Minister of Transport will remember that when the defence purchasing board legislation was before the house last year, considerable pressure was brought to bear from various parts of this chamber to have provision made that no member of the board should be a shareholder or stockholder in any armament firm, and the government brought in an amendment providing accordingly, but it was finally deleted by another body. The defence purchasing board was later merged with the war supply board, and the war supply board is now merged with the Department of Munitions and Supply. But the principle is still a good one; and in view of the fact that the government gave assent to the principle, I am wondering if it is being carried out so that those responsible for placing orders and for letting contracts under the minister shall be in no wise connected with the firms receiving the contracts; not because we are suspicious of everyone, but because the people of Canada would have a greater measure of confidence if they were perfectly certain that the men responsible for letting contracts on such a large scale were in
War Appropriation Bill

no wise connected with the business firms receiving the orders. Is that principle being carried out?


Clarence Decatur Howe: It is necessary, in organizing a supply programme on the scale that faces us to-day and did face us at the outbreak of war, to have the help of the most experienced men that Canadian industry can provide. We have attempted to get that type of assistance and, I think, have been fairly successful. But obviously when we draw a number of men from industry, we can hardly say that none of these men have or have had any connection with the firms that are making something for the government's war programme. I cannot give my hon. friend the assurance he wants, but I can give him this assurance: I know the calibre of the men we have chosen; I know their integrity, and I am prepared to take personal responsibility for anything they have done in the service of the government.


Alan Cockeram: I understood the Minister of National Defence when he was speaking to say that Colonel Carter had made and submitted a report to the government. Is that correct?


Norman McLeod Rogers: I made no such statement. I believe the statement which appeared in the Toronto Telegram yesterday did refer to a report which was made by Colonel Carter to Major-General McNaughton, and perhaps that is the report my hon. friend has in mind. But I made no reference to that report in my remarks.


Alan Cockeram: Is that report available in the department?


Norman McLeod Rogers: Mr. Chairman, I prefer not to answer that question at the present time. The report I assume was made to General McNaughton either in his capacity as former president of the National Research Council or in his capacity as inspector general of the units of the first Canadian division in training in Canada. I shall, however, make the necessary inquiries.


Mr. HARRIS (Danforth):: The question of the Lindsay arsenal has been brought up. Perhaps the minister or the hon. member for Victoria, Ontario, might tell us how many men will be employed when the arsenal gets into full production on June 15, or will be in full production by June 15.


Norman McLeod Rogers: I shall be glad to take note of the question and supply the information if it can be made available.


John Horne Blackmore: I have been much informed by the material which has been given out to-night. I would ask the minister iMr. T. C. Douglas.]
if any provision has been made for the manufacture of armoured cars in Canada. They should be much easier to manufacture than tanks, and they would be exceedingly valuable to the country under certain conditions.


Clarence Decatur Howe: We have produced in Canada all the mobile equipment that goes with a division, in fact two divisions-some 9,000 vehicles, of which 7,000 are of the type of armoured car my hon. friend has in mind. We also have production of universal carriers for carrying machine guns and other equipment that go with a division. We have manufactured in this country and have a very large production of all the mechanized equipment of a division apart from tanks.


Agar Rodney Adamson: That would include Bren gun carriers?


Clarence Decatur Howe: Yes. We have a contract for 600, and while we have yet to turn out the first, we are very close to production.


Mr. HAZEN:: I should like to ask a question of the minister having to do with members of the Canadian active service force going on leave. I understand that when they go on leave, they are provided with a warrant that permits them to travel at half fare. That would be perfectly satisfactory so far as the members of the force are concerned when they have to travel only a short distance. But in the case of a man located, say, in Ottawa, who, when he gets leave, has to go to Saint John, or Halifax, or Timmins, Ontario, with the warrant that he gets he is obliged to pay from $15 to $20 for his transportation. In the case of a married man, who, I understand, draws about $19 a month, this may work a great hardship. I am also informed, although I do not know whether the information is correct, that when a man goes on leave, he is unable to obtain an advance from the paymaster of his unit. Will the minister state whether that is so; also, whether any consideration has been given by the minister to the provision of free transportation to men going on leave prior to proceeding overseas?


Mr. TUSTIN:: I wish to say a word along the same line.


James Layton Ralston: I thought possibly the
committee had almost finished. If I could, I should like to report the bill to-night, although of course there is no intention to rush it. I was going to suggest that as the committee of supply will still have the main estimates of the Department of National Defence to consider, I would think, without making a ruling on it, that almost anything could be discussed on the question of the salary of the Minister of National Defence, if on no other

Questions
item. So if the discussion is about through, and if hon. members are willing, I would be very glad if the bill could be reported. However, I see it is five minutes after eleven.


George James Tustin: I wish to say a word about the same matter that the hon. member for St. John-Albert spoke about. I have received to-day three protests along the same line from my constituency. No doubt the Minister of National Defence knows that there are a great many men located at the city of Kingston or at Barriefield. My home is on highway No. 2, and they pass by there in great numbers. Last Saturday there was a torrential rain all day long, and there were actually hundreds of soldiers thumbing their way along that highway. I have had three protests to-day from my home town and that district asking me to take this matter up with the Minister of National Defence, with the object of assuring in future that the men receive free transportation from the Canadian National Railways which is owned by the people of this country.


Norman McLeod Rogers: I shall be glad to take a note of the question. I believe that the first hon. member who spoke, correctly stated the present position with respect to transportation warrants. My strong impression is that in this respect we have followed the practice which was established in the last war. It does not apply in England, where transportation warrants are given to those who are on leave.


John Ritchie MacNicol: The distances in England are very short.


Norman McLeod Rogers: Yes.


[Stage Direction]
Section agreed to.
Section 6 agreed to.
Bill reported.
On motion of Mr. Ralston the house adjourned at 11.06 p.m.
Wednesday, May 29, 1940.