THE WAR


Right Hon. W. L. MACKENZIE KING (Prime Minister):: Mr. Speaker, this morning Prime Minister Churchill and President Roosevelt issued a proclamation addressed to the people of Italy, setting forth that the sole hope for Italy's survival lies in honourable capitulation. The following is the text of the proclamation:
1.	At this moment the combined armed forces of the United States, Great Britain and Canada, under the command of General Eisenhower and his deputy, General Alexander, are carrying the war deep into the territory of your country. This is the direct consequence of the shameful leadership to which you have been subjected by Mussolini and his fascist regime.
2.	Mussolini carried you into this war as the satellite of a brutal destroyer of peoples and liberties.
3.	Mussolini plunged you into a w'ar which he thought Hitler had already won. In spite of Italy's great vulnerability to attack by air and sea, your fascist leaders sent your sons, your ships, your air forces, to distant battlefields to aid Germany in her attempt to conquer England, Russia and the world.
4.	This association with the designs of nazi-controlled Germany was unworthy of Italy's ancient traditions of freedom and culture- traditions to which the peoples of America and Great Britain owe so much.
5.	Your soldiers have fought not in the interests of Italy but for nazi Germany. They have
The War

fought courageously, but they have been betrayed and abandoned by the Germans on the Russian front and on every battlefield in Africa from El Alemein to Cape Bon.
6.	To-day Germany's hope for world conquest have been blasted on all fronts. The skies over Italy are dominated by the vast air armadas of the United States and Great Britain. Italy's sea coasts are threatened by the greatest accumulation of British and allied sea power ever concentrated in the Mediterranean.
7.	The forces now opposed to you are pledged to destroy the power of nazi Germany-power which has ruthlessly been used to inflict slavery, destruction and death on all those who refuse to recognize the Germans as the master race.
8.	The sole hope for Italy's survival lies in honourable capitulation to the overwhelming power of the military forces of the united nations.
9.	If you continue to tolerate the fascist regime which serves the evil power of the nazis, you must suffer the consequences of your own choice. We take no satisfaction in invading Italian soil and bringing the tragic devastation of war home to the Italian people. But we are determined to destroy the false leaders and their doctrines which have brought Italy to her present position.
10.	Every moment that you resist the combined forces of the united nations-every drop of blood that you sacrifice-can serve only one purpose; to give the fascist and nazi leaders a little more time to escape from the inevitable consequences of their own crime.
11.	All your interests and all your traditions have been betrayed by nazi Germany and your own false and corrupt leaders; it is only by destroying both that a reconstituted Italy can hope to occupy a respected place in the family of European nations.
12.	The time has now come for you, Italian people, to consult your own self-respect and your own interests and your own desires for a restoration of national dignity, security and peace. The time has come for you to decide whether Italians shall die for Mussolini and Hitler or live for Italy and for civilization.


Mr. GRAYDON:: Has the Prime Minister any information as to the means by which that message is to be conveyed to the people of Italy?
Mr. MACKENZIE KING; I understand that it was distributed by aircraft, and I have no doubt that it has also been communicated over the radio.



FARMERS' CREDITORS


[Stage Direction]
Hon. J. L. ILSLEY (Minister of Finance) moved for leave to introduce Bill No. 132, to facilitate compromises and arrangements between insolvent farmers and their creditors.

Mr. GRAYDON; May I ask the hon. gentleman to explain?
Mr. ILSLEY:: As the House of Commons knows, it was announced some time ago that a consolidated Farmers' Creditors Arrangement Act would be introduced as soon as the war appropriation bill was passed. This is that bill. I think the statement as to the principles upon which the bill is built and founded had better be postponed until the second reading. In the meantime the bill will be circulated.
Motion agreed to and bill read the first time.



PRESS REPORT AS TO DISCONTINUANCE OF RATIONING IN THE UNITED STATES

[Stage Direction]
On the orders of the day;
Gordon Graydon: Mr. Speaker, I have a question to direct to the Minister of Finance. An Associated Press dispatch from Washington under dateline of July 15 predicts that coffee rationing in the United States will come to an end on or about August 11. Will the minister be good enough to indicate to the house if this will mean any change so far as coffee rationing in Canada is concerned?


James Lorimer Ilsley: Anticipating that this question would be asked, I asked the wartime prices and trade board for information on the subject. The wartime prices and trade board has no official advice of any proposed change in the United States coffee rationing and has only seen the newspaper reference. The situation in Canada regarding coffee rationing is quite different from that in the United States, because in normal times Canadians use approximately equal amounts of tea and coffee, while in the United States only a comparatively small amount of tea is used. It was possible to ration coffee alone in the United States, while in Canada the two had to go together.


Gordon Graydon: There is no tea rationing in the United States?


James Lorimer Ilsley: I do not know about that; it is separate, at any rate. Coffee is dealt with alone in the United States.


Gordon Graydon: I thought the minister was indicating that.


James Lorimer Ilsley: I am not sure about it. The supply position of both tea and coffee is dependent upon shipping; in the case of tea, from India, and in the case of coffee, from

Wartime Information Board
South America. Until the stock position of both commodities is assured and future supplies are reasonably certain, it is not possible to increase the present ration allowances.



CENSORSHIP


[Stage Direction]
On the orders of the day:
Gordon Graydon: I should like to direct a question to the Minister of National War Services. I understand that a new censorship directive has been issued, I think yesterday, placing on radio stations the responsibility for keeping off the air any statements that might injure Canada's war effort. I would be glad to have the minister inform the house as to the details of this new directive and to lay a copy of it on the table of the house.
Hon. L. R. LaFLECHE (Minister of National War Services): The leader of the opposition was kind enough to send me an intimation that he would put this question, but unfortunately I got it only just before coming into the house. May I say at this time -I shall go into the question in detail by to-morrow-that on June 28 a new directive was issued by censorship, after the matter had been considered for a number of weeks. The purpose of the new directive was to clarify and simplify the matter of censorship in regard to broadcasting. This is one of the matters mentioned in a motion moved by the hon. member for Peterborough West (Mr. Fraser). Colonel Biggar is now back in town. I spoke to him yesterday and I hope to have some details from him very quickly when I shall be in a position to reply to the hon. member for Peterborough West.



ONTARIO ELECTION


[Stage Direction]
July 10, 1943
On the orders of the day:
Mr. M. J. COLDWELL (Rosetown-Biggar):: I should like to draw the attention of the Minister of National Defence to an article which appeared in an official army newspaper called The Grenade, the issue of July 10, 1943. The editorial page is headed, "Official organ of units and training centres, Petawawa military camp". The editorial to which I should like to refer is headed "The Forthcoming Election", and one paragraph reads:
Your choice is between a government headed by Colonel George Drew, Conservative, or by Honourable Harry Nixon, Liberal. Both are
well known and the decision may be a close one. It is up to each of us to see that that decision is truly representative of the current trend of opinion among men in the armed services.
There are three parties contending in the Ontario election. In my opinion it is incorrect and political propaganda to say that only two are contending, and I draw this to the attention of the minister.


Hon. J. L. RALSTON (Minister of National Defence):: I shall find out the authenticity and the authorship of that paper. I must say that personally I do not know of it, but I would assume that it is published by the units themselves.



WARTIME INFORMATION BOARD


[Stage Direction]
On the orders of the day:
Mr. BROOKE CLAXTON (Parliamentary Assistant to the President of the Privy Council) :: Mr. Speaker, yesterday the leader of
the opposition asked, first, for a clarification of a statement I made on Tuesday and, second, in what way the wartime information board played a part in the news of the landing in Sicily. His question referred to newspaper editorials, presumably those in the Ottawa Journal, the Montreal Gazette and the Globe and Mail, which said or implied that credit had been claimed for the wartime information board for the fine stories of Ross Munro. Such a claim would have been preposterous, and such an interpretation was not justified by the record. The actual words referred to by the leader of the opposition were:
The events of the last few days indicate how useful has been the cooperation of the press relations officers, the press associations, the correspondents of newspapers overseas, with the wartime information board at various points in the background, in seeing that the people of this continent got early news of the landing in Sicily, and also that the statements which were made have afterwards received early and favourable notice in the United States both in the press and over the radio.
What the statement did' was to name specifically the other agencies which had to do with this early and favourable notice, and then to add that the wartime information board had done useful work in the background. The limited nature of this assertion was emphasized in two further references, and the general relationship of the board to the press was made plain in numerous references in the speeches of the Prime Minister and myself.
The statement quoted speaks of the "early news of the landing in Sicily". This referred
Wartime Information Board

particularly to the first news of Canadian participation, given in the United States war department communique, and to the Prime Minister's statement, both of which were issued in the first hour of Saturday morning. The dispatches from correspondents with the troops only came more than twenty-four hours later. The facts that word of the Canadians taking part came with the first announcement of the invasion, and that the Prime Minister's statement was issued immediately afterwards, were of prime importance.
The role that the wartime information board had in these early announcements can now be better understood in the light of the Prime Minister's statement yesterday.
The board was in continuous consultation with other officers of the government in endeavouring to see that the first announcement of an invasion included mention of Canadians. It also made arrangements to ensure that the Prime Minister's statement immediately afterwards was quickly and effectively distributed, particularly in the United States. Hon, members will appreciate the importance of the quick distribution of the first statement of Canadian participation from a Canadian source. Had the news about Canadian participation. been delayed for a day, the facts would never fully have caught up with the first impression of the world that only British and American troops were involved and Canadian stories would not have been as well received.
In the statement nothing whatever was said to detract from the work in Sicily of Mr. Ross Munro or other correspondents, or of the Canadian Press itself. Mr. Munro's despatches were superb. They have done much to tell the Canadian people vividly about their troops in action, for which I did not for a moment claim credit for the wartime information board. In this case the board had to do with the early announcements and the quick and effective distribution of the first statement about Canadian participation emanating from Canada.
The extreme importance of the work of the war correspondents stands out and is fully recognized. In the field the three services maintain public relations officers who were formerly trained newspapermen themselves. The British and American armies also maintain public relations services. Their full-time duty is to assist war correspondents in obtaining and transmitting material and- facilitating their work in every conceivable way. The public relations officers of the armed forces, under Mr. J. W. G. Clark, work in very close

cooperation with the wartime information board. Working together they supplied background material on the Canadian army to supplement news from the front and gain credit for the people to whom it should be given, namely, the Canadian soldiers who are at this moment in battle with the enemy.


Gordon Graydon: It is still not very clear to me how the wartime information board had anything to do with respect to the news which reached the Prime Minister and was then disseminated, because it would come through the ordinary press channels. The Prime Minister then gave his statement to the public. Therefore it is not clear to me how the board can still claim to have taken any significant part with respect to what happened last Friday night or last Saturday.


Brooke Claxton: My hon. friend must appreciate that the full story cannot be told or the usefulness of a good deal of the board's work might disappear. I could tell my hon. friend this, that even on Thursday officers of the board were in almost continuous consultation.with officers of other departments considering the situation and working towards the end that the Prime Minister achieved. On Friday the office in Washington was kept continually manned with ticker services from various directions, and possibly the first word to reach Ottawa of the American communiques from Algiers and the Pentagon building were sent in- from Washington. Then the statement of the Prime Minister was sent back to Washington and was given very early and favourable attention in the American press.



DOUKHOBORS


[Stage Direction]
On the orders of the day:
Hon. GROTE STIRLING (Yale):: May I ask the Minister of Justice if he has delivered a ruling on the question whether a police officer has authority to direct a Doukhobor bodily to report if such Doukhobor has ignored his notice for alternative service, or is it necessary for a court order to be first obtained?
Hon. L. S. ST. LAURENT (Minister of Justice): I will make inquiries and find out if any opinion has been given by the Department of Justice, and if one has been given whether it is in such form that it can be tabled here.

Transfer of Lands



TRANSFER OF LANDS


[Stage Direction]
Hon. L. S. ST. LAURENT (Minister of Justice) moved that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to confirm the transfer of certain lands to Ontario and Quebec effected by order in council of the 26th day of January, 1943.
Motion agreed to and the house went into committee, Mr. Bradette in the chair.
Gordon Graydon: I am not sure whether the minister has given any explanation of the object of this resolution, or any statement of the principle of the bill to be founded upon it. I think this is the appropriate time for a short statement from the minister.
Mr. ST. LAURENT: Mr. Chairman, I think before making a statement I should table a bill of the legislature of Ontario assented to on February 19, 1943, and a bill of the legislature of Quebec assented to on May 20, 1943, both dealing with the ratification of an agreement made between these two provinces and dated January 2, 1943.


Mr. HANSON (York-Sunbury):: Will the minister also table the order in council referred to in the resolution?
Mr. ST. LAURENT: The order in council has already been tabled, and copies of it are printed as annexes to the bills of the two provincial legislatures. For the convenience of members of the committee who may be interested I have secured additional copies of these bills and I will now make them available to hon. members, a certain number of them having been made available to me by the clerk of the Ontario legislature and likewise by the clerk of the Quebec legislature.
To state very shortly what is involved, the resolution refers to whter powers on the Ottawa river. The Ottawa river, as all hon. members know, is interprovincial. There have been developments on that river but there are still available water powers susceptible of developing as much as 900,000 horse-power. Those powers could not be developed without an agreement between the provinces. The Ottawa river is regarded as a navigable river, and the extent of the private rights in the Ottawa river depends, of course, on the respective laws of Ontario on the one side and of Quebec on the other. The Ontario government was desirous of
developing additional water powers on the upper reaches of the Ottawa river, and the governments of the two provinces came to the conclusion that it would be more practical if they made an exchange of their respective rights so that one province would have the whole of the water powers at one point and the other province the whole of the water powers at the other point. They could then set about developing their respective properties in the manner which would suit the requirements and convenience of the people of their respective provinces.


Gordon Graydon: There are five power sites involved?
Mr. ST. LAURENT: There are five power sites involved, and the arrangement they arrived at was that Carillon, which is the one lowest down, Rocher-Fendu, which is the third, and one-half of Paquette, would go to the province of Quebec, and that Chenaux, which is between Carillon and Rocher-Fendu, would go to Ontario, and that the two upper sites, Des Joachims and Cave and Foumeaux, also go to Ontario.


Richard Burpee Hanson: The effect of that would be to alter somewhat the interprovincial boundaries?
Mr. ST. LAURENT: No, not to alter the interprovincial boundaries but to alter the
property rights vested in the crown in the right of each respective province. The arange-ments do not provide for permanent grants; they are very long-term leases.


Gordon Graydon: That, I think, raises one of the principal points in connection with the proposed legislation. There are those who believe that this is a device, though I do not use the word in an offensive way, by which the boundaries of two provinces are being changed, not by an exchange of deed of land, but nevertheless on an extremely long-term lease which actually has the same effect in the end as an exchange of properties, and by virtue of that it is an alteration in the actual boundary lines between the provinces. The point involved, which the minister will see very quickly, is that to set such a precedent goes to the root of the British North America Act; for I think it is generally understood that provinces by agreement cannot alter the boundary lines set by the British North America Act, which is a statute of the parliament of the United Kingdom. Whether. or not the government has succeeded by virtue of a device with respect to a long-term lease in avoiding the constitutional point which would be raised were deeds to be given and the boundary line thereby changed, constitutes

Transfer of Lands
one of the main constitutional legal points which this legislation raises. I should like the Minister of Justice to give his views about it, because it is in the minds of many people at the moment.
Mr. ST. LAURENT: I do not think the discussion of the point requires any very long debate. The bill before this house would not have been necessary at all had there not been some proprietary rights of the dominion in connection with one or other or several of these sites. The agreement between the provinces purports to vest on the one hand in the Quebec streams commission and on the other hand in the Ontario hydro certain leasehold rights. The Ontario hydro can come into Quebec and acquire leasehold rights without affecting in any way the territorial boundaries of Quebec, and the Quebec streams commission can likewise acquire in Ontario leasehold rights without that having any effect upon the boundaries of the two provinces.


Richard Burpee Hanson: They are both corporations.
Mr. ST. LAURENT: They are both corporations acting and holding for the crown in the respective areas of the two provinces. But that would no more alter the boundaries of the provinces than if the Ontario hydro were acquiring a farm to raise produce to feed the employees attending one of its undertakings. The arrangement between these two provinces would have been made without any reference to the federal government at all had it not been that the government of the united Canadas prior to confederation had made some improvements to assist in navigation and in the floating of logs, and by virtue of the distribution of proprietary rights at confederation retained such improvements as had been made for that purpose. Hon. members will recall that a few years ago there was a reference to the supreme court to determine which government would own water powers which might be improved or increased or made available by the existence of these federal improvements, and the court, following opinions which had been expressed by the privy council, was very guarded in its language and it is not easy to find any definite pronouncement in that regard in the judgment which was rendered.


Richard Burpee Hanson: Was that a
reference?
Mr. ST. LAURENT: That was a reference to the supreme court.


Richard Burpee Hanson: Therefore it was rather ineffective.

Mr. ST. LAURENT: There was no concrete case involved. The court, in a learned discussion of the old law, refrained from making a pronouncement which would have any concrete effect on any specific water-power.


Richard Burpee Hanson: My recollection is that the effect of the judgment was practically nil.
Mr. ST. LAURENT: I think it might be put in this way: the dominion asserted, through counsel representing it before the supreme court, that it had proprietary rights in water powers, and the court refused to accept the view put forward by the dominion government.


Richard Burpee Hanson: One other question. As I appreciate the situation on these interprovincial streams, the minister stated that the river is declared to be a navigable river; therefore we have a substantial interest under that question of navigation. What is the position with respect to that in this matter? Is there any interference or anything of the kind?
Mr. ST. LAURENT: No. The agreements all provide that all these plans will have to be submitted for examination and approval under the Navigable Waters Protection Act. Nothing can be done without the detailed plans being submitted and the usual undertakings being made. The plans will not be approved, of course, if they provide for any interference contrary to public interest with navigation at the time they are submitted. There is also an undertaking on the part of those who submit plans for approval that if in the future conditions should arise where public interest would require modifications to be made, the owner of the works will have to make them.
This legislation does not envisage the Quebec streams commission on the one hand and the Ontario hydro on the other as anything more than companies, corporations, and the reason for the legislation is that the Dominion has certain proprietary rights, not the same on the two sides. Under Quebec laws, as hon. members know, along navigable waters the riparian rights stop at the high water mark, whilst I understand that under the common law it is at least contended that even in navigable streams they may extend out to midstream.


Richard Burpee Hanson: Yes. It depends somewhat on the original grants.
Mr. ST. LAURENT: The federal government did own some portion of the shores along these various stretches of river which would be affected by the development of the water powers.

Transfer of Lands


Richard Burpee Hanson: That is at Carillon.
Mr. ST. LAURENT: At Carillon and also above Des Joachims; and the developments could not prudently be made without acquiring these shore rights.


Richard Burpee Hanson: In other words, the federal government has a proprietary interest in part of these power sites.
Mr. ST. LAURENT: Possibly in a small part of the Carillon power site; probably not in any other of the power sites, though it may have shore property.


Richard Burpee Hanson: Flowage rights.
Mr. ST. LAURENT: Yes. The companies or corporation, or commissions, whatever they may be, to make the development would have to acquire these rights from individuals by mutual arrangement or by expropriation proceedings. They could not expropriate against the dominion government' the federal crown, and the arrangement that was made was that the federal government would cede to them such riparian rights, flowage rights, or whatever it may be, as would be necessary for the execution of development work. The view was taken that the people of Canada whether inhabitants of one province or another, were Canadians and that if this was something that constituted a valuable natural resource it was in the interests of the Canadian people that it be developed and used when there was need for the power that could be produced, and that it would not be proper for the dominion government to take an attitude that would prevent the use of these water powers in the interests of the public generally when the proper time arrived for development.


Richard Burpee Hanson: In other
words, we could not adopt a dog-in-the-manger attitude-
Mr. ST. LAURENT: No.


Richard Burpee Hanson: -and say, "You cannot appropriate against us"; that would retard development. When the minister uses the word "cede" does he mean give, or are they to pay?
Mr. ST. LAURENT:	No; they are
transferred. They are not properties of considerable value outside of their, shall I say nuisance value in connection with the development of water power.


Richard Burpee Hanson: Have they no strategic value?
Mr. ST. LAURENT:	No strategic value
for purposes of defence.


Richard Burpee Hanson: I mean, for the purpose of water power. I do not know the situation; I am just asking.
Mr. ST. LAURENT: The hon. member, as a lawyer advising a corporation, would say, "Well now, don't attempt to go ahead until you get that; it is something without which you would not have the kind of title I would recommend for a bond issue."


Mr. POTTIER:: It might be valuable.


Richard Burpee Hanson: lit is
valuable.
Mr. ST. LAURENT: How that kind of value can be measured it is very difficult to determine, as was shown in the famous Cedar Rapids case, which was for years before the courts and went twice to the privy council.


Richard Burpee Hanson: The value is the value to the owner, not to the taker.
Mr. ST. LAURENT:	The value to the
owner is something very difficult to measure, but under these conditions we thought it would not be proper for the dominion government to be very particular about that. At the time this was done the provision of additional power was looked upon as of considerable interest to the war effort of the country; the Ontario hydro was prepared to make an investment which it was estimated might run into $40,000,000 to provide power, and perhaps the few hundreds or thousands of dollars that might have been established as value to the owner of these rights was not looked upon as a consideration that should stand in the way at all; after all the federal and provincial purses were all purses of the people of Canada, so that it was not very important to have any exact figure assessed. What was arranged was that in order to facilitate this exchange between the two provinces, and to allow each to have control of a certain portion of the sites, the federal government should abandon such rights as it might have.


Richard Burpee Hanson: The question of joint development was not considered, or not agreed upon?
Mr. ST. LAURENT:	It was found that
because of the difference in the situation between the two provinces the interests were not similar. Quebec at the present time does not consider that it is in its interests to develop any more water powers.


Richard Burpee Hanson: After
Arvida or Shipshaw you have quite a surplus.
Transfer of Lands

Mr. ST. LAURENT:	After the war we
shall have quite a surplus there, and there is always development on the St. Lawrence. That is looked upon as a possibility, and if that were done it would provide such an enormous block of power that it would not be of practical advantage to have these other sites developed now.


Mr. McDONALD (Pontiac):: And there is the location of the power.
Mr. ST. LAURENT: Ontario did feel that it would suit the conveniences of its public and of its commission to develop these upper sites of the Ottawa immediately.


Mr. MacNICOL:: May I ask a question in reference to the development of the Ottawa river? The federal government apparently has nothing to do with the development of electricity, but it has to do with everything pertaining to navigation.


Richard Burpee Hanson: Yes.


John Ritchie MacNicol: Perhaps not in this
generation, but in some other generation in the future, I have no doubt the Ottawa river will be a great commercial highway. In the construction of these dams that are to be erected by the Ontario hydro commission, does the federal government intend at this time to see to it that some provision is made for future locks in these dams, or is any consideration being given to the future levels of the river so far as navigation is concerned?
Mr. ST. LAURENT: All I can say is that these questions have not yet arisen, and they will arise under the Navigable Waters Protection Act when the plans are drawn and submitted for approval.


John Ritchie MacNicol: They would have to be approved?
Mr. ST. LAURENT:	They will have to
be approved by the federal government before they can be carried out. They have to submit detailed plans of what is to be constructed in a navigable stream; they cannot place any obstruction in a navigable stream without prior approval of the project by the governor in council, and the governor in council can stipulate all such facilities as appear to be necessary.


John Ritchie MacNicol: I do not know at the
moment, perhaps the minister knows, whether in the construction of the Chats dam up the Ottawa river any consideration is being given to future navigation facilities at that dam.
Mr. ST. LAURENT:	No. I think the
only thing that is provided there is log slides

for the floating of timber. I do not think any provision has been made there for a lock that would lift a boat.


Richard Burpee Hanson: Were any private interests involved in the upper Ottawa, and how are they being dealt with?
Mr. ST. LAURENT: I do not know that there were private interests involved in the upper Ottawa. There was a private interest at Carillon, for which express provision is being made.


Richard Burpee Hanson: Protection is given to private rights?
Mr. ST. LAURENT: Oh, yes; full protection is given to private rights, and if there are any private rights in the upper regions they will have to be acquired by the Ontario hydro.
Resolution reported, read the second time and concurred in. Mr. St. Laurent thereupon moved for leave to introduce Bill No. 133, to confirm the transfer of certain lands to Ontario and Quebec.
Motion agreed to and bill read the first time.


Mr. SPEAKER:: When shall said bill be read a second time?


Gordon Graydon: We have not seen the bill yet, and of course we cannot give second reading to a bill we have not seen.


Thomas Vien: Next sitting of the house.

Hon. L. S. ST. LAURENT (Minister of Justice): When the bill to confirm the transfer of certain lands to Ontario and Quebec was read the first time this morning, it was ordered to be read a second time at the next sitting, and the leader of the opposition (Mr. Graydon) suggested that after it had been distributed and hon. members had had an opportunity of seeing it, it might be taken up later in the day. If that is agreeable I would move:
That the order made this day for the second reading of Bill No. 133, an act to confirm the transfer of certain lands to Ontario and Quebec, at the next sitting, be discharged, and that the bill be now read a second time.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Bradette in the chair.
Schedule agreed to.
Section 1 agreed to.
On the preamble.
Gordon Graydon: The preamble is incomplete and should not be passed as it is. The

Canada Evidence Act
bill as presented to the committee left in blank line 10 where "20th" and "May" should be inserted. In order that the committee's procedure may be perfectly regular, an amendment should be made to the preamble.
Mr. ST. LAURENT: It was my intention that the bill as distributed should be amended by inserting in the blanks in line 10 the words "20th" and "May".


Mr. MICHAUD:: I move accordingly.


Gordon Graydon: May I say, Mr. Chairman, that I think we must regularize this. I dislike rising from time to time on petty technicalities, but the amendment as proposed means absolutely nothing so far as the preamble is concerned. What the minister must do, I think, is first of all indicate the words which are to be inserted and the words immediately preceding the insertion in each case, and the words immediately following, otherwise the amendment does not mean anything.


Joseph Enoil Michaud: I move:
That the preamble of Bill No. 133, an act to confirm the transfer of certain lands _ to Ontario and Quebec, be amended by inserting on page 1, line 10, after the words "assented to on the" the word "20th" and after the words "day of" the word "May".


[Stage Direction]
Amendment agreed to.
Preamble as amended agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
Hon. L. S. ST. LAURENT (Minister of Justice) moved the second reading of bill No. 74, to amend the Canada Evidence Act.
Richard Burpee Hanson: I read this bill some weeks ago, and if I remember correctly its effect is to extend the principle of the secondary evidence rule, in a degree, in regard to certain oaths taken abroad and that sort of thing. Is this a practice that has existed in the provinces? I understand it has been adopted in the province of Quebec, but have any other provinces adopted it?
Mr. ST. LAURENT: I had inquiries made in that regard. In the province of Quebec it is article 1220 of the civil code. In British Columbia it is chapter 90 of the revised statutes of 1936, the Evidence Act. In Alberta it is chapter 87 of the revised statutes of 1922, the Evidence Act. In Saskatchewan it is chapter 67 of the revised statutes of 1940, the Witnesses and Evidence Act. In Manitoba it is chapter 65 of the revised statutes of 1940, the Evidence Act. In Ontario it is chapter 119
of the revised statutes of 1937, the Evidence Act. In Nova Scotia it is chapter 225 of the revised statutes of 1923, the Witnesses and Evidence Act. In New Brunswick it is chapter 167 of the revised statutes of 1927, the Registry Act. In Prince Edward Island it is chapter 2 of the statutes of 1939, the Affidavits Act.


Richard Burpee Hanson: This is an extension of the principle-
Mr. ST. LAURENT: I submit to the hon. member that it is not an extension of the principle; it is an addition to the number of officers abroad who would be entitled to take the affidavits that could be used. It is to enable the representatives of Canada abroad to take these affidavits with the same effect as though they were taken before the British ambassador.


Gordon Graydon: I should like to ask two questions arising out of that explanation. In the first place I think this is the first bill I have seen for a long time with no explanatory note attached to it, and when the bill was introduced I wondered at the omission of the customary explanatory note, which is a very important matter to hon. members generally in dealing with legislation. Obviously for some considerable time the situation which this bill purports to rectify must have been well known to the government. What actually has been done in foreign countries with respect to the taking of oaths, affidavits, declarations and so on? Was all this work done by one or two principal officials in those countries, and' is it the intention of this bill to increase the number who will be allowed to exercise that power and authority as envisaged by the legislation?
Mr. ST. LAURENT: No. Prior to this the affidavits in practice were taken by the officials for whom this bill makes provision; but there is this difference. The provisions of the provincial statutes only apply to matters governed by provincial legislation. It sometimes happens that in the same case the Canada Evidence Act might be applicable to one portion of the litigation while provincial legislation would be applicable to another portion. This is merely to add to the Canada Evidence Act a provision in connection with the same officials who come under the various provincial acts, so that no question may arise on an affidavit as to whether the provincial act or the Canada Evidence Act applies. Under this an affidavit will be in such form that it will be immaterial whether the provincial act or the Canada Evidence Act applies to its validity.
Canada Evidence Act


Gordon Graydon: The minister did not answer the other question I raised.


Thomas Vien: Order. This motion is for second reading. Perhaps these questions could be asked in committee. Is it the pleasure of the house to adopt the motion?


Mr. NEILL:: No, Mr. Speaker; I rise to a point of order. I have a painful recollection of this point in connection with the lack of an explanatory note being raised against me some years ago, by the predecessor of the present minister and others. At that time my bill was thrown out because it lacked this explanatory note, and it was far more important than this bill is.


Thomas Vien: Is it the pleasure of the house to adopt the motion?


Alan Webster Neill: No, Mr. Speaker. I rose to a point of order, and my point is that the bill cannot be introduced while it lacks an explanatory note. At that time the government had eight bills on the order paper, all of which had to be withdrawn and reintroduced. The principle involved at that time was that what was sauce for the goose was sauce for the gander; I am sure hon. members will recall the situation.


Thomas Vien: The motion is for second reading of the bill.


Alan Webster Neill: I was told definitely that the motion for second reading was exactly the point at which I should have taken this objection. I had let the matter go a little beyond that, and for that reason my objection was ruled out. However, my bill was ruled out of order on the motion for second reading because it lacked an explanatory note. At that time the government had eight bills on the order paper which also lacked explanatory notes. My bill was of such a character that no explanation was required; for it simply struck out a section and reinserted it, and it was not possible to put in any explanation. However, my bill was thrown out on that ground. The next day, or a few days later, I raised an objection to one of the government bills and the reply was that I should have made my objection on the motion for second reading, so that my protest was thrown out. But I noticed that the government withdrew the eight bills and then reintroduced them. I do not want to press the point unduly, or unnecessarily delay the house, but the principle should be acknowledged that if it is good on one occasion it is good on another. It is definitely stated that these bills must have an explanation.

Mr. ST. LAURENT: Would the hon. member be so kind as to direct my attention to the rule which so states?


Alan Webster Neill: I am sorry to say I do not carry all the rules in my head. This occurred in 1938; I believe the bill I introduced was No. 11, making certain amendments in connection with Japanese immigration. The Prime Minister raised' a point of order, that my bill lacked an explanatory note. I gave the explanation I have just given here, that no explanation was required, because the whole thing was so obvious; a whole section was struck out and another section inserted, and the explanation was self-evident. However, the Speaker of the day ruled that it was out of order, so that my bill fell by the wayside, though I later introduced it with the required amendment. A few days later I raised the same objection on some government measures, and I was ruled out of order, because I had not taken the point of order on second reading. Thereafter the government withdrew their eight bills and introduced them, with the lacking explanation.


Richard Burpee Hanson: And the hon. member has waited for an opportunity ever since.


Alan Webster Neill: I have.


Richard Burpee Hanson: Perhaps it can be wmived on this occasion, so long as the majesty of the law has been vindicated by its assertion.
Mr. ST. LAURENT: The rules relating to the preparation of bills are stated at pages 356 and 357 of Doctor Beauchesne's book as follows:
The rules of the House of Commons as to the preparation and printing of bills, adopted 14th June, 1923, must be followed by all departments. They are as follows:
1.	In the preparation of bills amending existing enactments the amendments shall not ordinarily be made by clauses which add or leave out words or substitute words for others, but by clauses which reenact the section, subsection or other minor division, as it is amended.
2.	In the text of the bill, on the left hand page, new matter shall be indicated by such typographical means as may best suit the varying circumstances of each case, such as brackets, italics, underlining, asterisks, etc. Opposite each clause, on the right hand page, the enactment amended thereby, or so much thereof as is essential, shall be printed with the proposed changes to be made therein similarly indicated.
3.	When a clause repeals an existing section, subsection or other minor division of a section, that section, subsection or division, or so much thereof as is essential, shall be printed opposite the clause.
4.	A memorandum by the draftsman explaining briefly the reasons for each clause, shall he

Canada Evidence Act
appended to the bill, or distributed therewith. Whenever practicable the memorandum shall be printed on the right hand page of the bill, in paragraphs opposite the clauses referred to and numbered correspondingly.


Alan Webster Neill: That is the rule.
Mr. ST. LAURENT:
5.	The above rules shall also as far as practicable apply to the reprinting of bills.


Richard Burpee Hanson: It is
merely a rule of convenience.
Mr. ST. LAURENT: It is, no doubt, the fourth paragraph the hon. member has in mind, where it states:
A memorandum by the draftsman explaining briefly the reasons for each clause, shall be appended to the bill, or distributed therewith.
It is clearly a rule of convenience. In this instance I have endeavoured to give explanations to the house. It does not change any existing text. It is new matter, and self-explanatory. Any explanation would simply be saying the same thing in other words. The text itself enumerates those before whom affidavits may be made. I believe there can be no other explanation than that.


Grote Stirling: There could not on the other occasion, either.
Mr. ST. LAURENT: I was not here at that time, and I should not like to take personal responsibility for the objections which may have been taken then.


Richard Burpee Hanson: Speaking to the point of order, I think the rule may perhaps be read as mandatory. But, after all, it is merely a rule of convenience, so that hon. members may be able to learn what a bill is about. I believe the hon. member for Comox-Alberni (Mr. Neill) was strictly right in the position he took. But, having vindicated his position, perhaps he would waive his objection, so that we can get on with the bill.


Mr. REID:: On the point of order, I believe the house will gladly waive the printing of the explanatory notes. But the principle should be laid down that there cannot be two rulings. A ruling was definitely given against the hon. member for Comox-Alberni and, Mr. Speaker, if your ruling is to the effect that the present procedure is the proper one I suggest you are setting up a new precedent. In such event your ruling would be in contradiction of the ruling given a few years ago. I raise this question of principle because it seems to me that at times it is like asking advice from officers of the crown. You can get from officers of the crown any
advice the government wants. I have spoken on the point of order to support the hon. member for Comox-Alberni.
Mr. ST. LAURENT: I do not think I can let the hon. member's statement go unchallenged by the Department of Justice, if he purports to include the Department of Justice in the expression "officers of the crown".


Thomas Reid: I wish to make no reflection upon the Minister of Justice, or any minister of justice. But I believe it is generally understood at least by laymen-and I shall leave the lawyers out of it; sometimes laymen see more clearly in matters of justice or matters of law-that when the government want information from the crown they generally get the information they ask for. I shall leave it at that.


Alan Webster Neill: May I express my willingness to waive the point of order I have taken, because, as the hon. member for York-Sunbury has said, justice has been vindicated by my having drawn attention to it.


Thomas Vien: Might I point out to
the member for New Westminster (Mr. Reid) that I had not ruled upon the point of order. All I had done was to say that we were dealing with the motion for second reading. Then the point of order was raised by the hon. member for Comox-Alberni, and he was entirely correct in raising it. Having waived it, the question now before the house is: Is it the pleasure of the house to adopt the motion?


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Bradette in the chair.
On section 1-Application of part III.
Richard Burpee Hanson: Mr. Chairman, it is some time since I looked at the Canada Evidence Act, but I would gather that as it stands to-day wTe have no provision in it such as is contained under the caption "Part III" in the bill.
Mr. ST. LAURENT (Minister of Justice): No; the Canada Evidence Act stops at section 46.


Richard Burpee Hanson: And does not cover this particular precedure.
Mr. ST. LAURENT: No, not at all.


Richard Burpee Hanson: I suggest that the variety of classes of officers mentioned in paragraph (a) is exceedingly wide. It covers ambassadors, envoys, ministers, charges d'affaires, counsellors, secretaries, attaches. and some others. I cannot conceive
Canada Evidence Act

that an attache would be a proper officer to take these affidavits. He might be a sailor or an airman, for instance. Then it refers to consuls general, consuls, vice-consuls and pro-consuls and consular agents. I should think they would be very properly included, because they take affidavits under other statutes. I believe acting consuls general might be included in the same category. I cannot however understand why attaches should be included. Would it be wise to include them?
Mr. ST. LAURENT: Attaches in legations are high ranking officers.


Richard Burpee Hanson: But have they any legal training. A consul general is a man who is always dealing with legal documents, but a military attache, for instance, would not be in that category at all. That is the only objection I can see to it.
Mr. ST. LAURENT: The only function they have to perform is to hand the Bible or the New Testament to the person.


Richard Burpee Hanson: They have to sign the jurat. I do not know whether they are as technical in the courts of Quebec as they are in my province, but any alteration in the jurat which is not properly attested to is inadmissible as evidence. I am not going to press the point. My purpose has been served by bringing this matter to the attention of the minister but I do think he should delete the word "attaches". In line 27 of paragraph (c) appear the words, "His Majesty's dominions outside of Canada." Does the word "dominions" include crown colonies, or is it used in its technical sense and meant to refer only to dominions such as Canada or Australia? I would assume that it is allinclusive.
Mr. ST. LAURENT: That is what is intended.


Richard Burpee Hanson: What does the minister think of my objection to the word "attaches"?
Mr. ST. LAURENT: I have no personal experience in the administration of these offices, but the attaches are quite high ranking officials. This is for the convenience of those who must have affidavits taken. If they had to wait until the ranking member of the office was free, it would take more time. If there is more than one person who can do the thing that is required, it will be more convenient for the person who requires it done. I have no other reason for urging that it remain. They are officers of equal rank to the first, second or third secretaries, and it would be more

convenient if all those who are entitled to be left in charge could receive affidavits. If anyone were left out it would be proper that the chief of the office should not leave the office in his care because it would be inconvenient if he were not able to do one of the things that might be required to be done.


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


[Stage Direction]
Hon. L. S. ST. LAURENT (Minister of Justice) moved that the house go into committee to consider the following resolution:
That it is expedient to bring in a measure to amend the Exchequer Court Act to provide that for the purpose of determining liability in any action or other proceeding by or against His Majesty, a person who was at any time since the tw'enty-fourth day of June, one thousand nine hundred and thirty-eight, a member of the naval, military or air forces of His Majesty in right of Canada shall be deemed to have been at such time a servant of the crown.
Richard Burpee Hanson: Will the minister state what the scope of the bill will be?
Mr. ST. LAURENT: The scope of the bill will be only as set out in the resolution.
Motion agreed to and the house went into committee, Mr. Bradette in the chair.


Richard Burpee Hanson: This resolution arises out of a decision of the exchequer court in the King v. McArthur which reaffirmed the principle that a member of the naval, military or air forces of his majesty, being an enlisted man, was not a servant of the crown in the sense of the Exchequer Court Act. I think this legislation is a measure of justice, but it does not go quite far enough. I have no quarrel on legal grounds with the decision in the King v. McArthur, because I think it is based on the English decisions, and I believe also there have been one or two Canadian decisions. My point is that the right to sue the crown is still being limited to actions in the exchequer court.
I suggest that the day has arrived in Canada at least, if not elsewhere, when consideration -I shall limit it to that-should be given to providing for the subject the right to sue the crown in any provincial court. I recall the reasons why this has been limited heretofore to the exchequer court. One of them is that it prevents fictitious or small claims being

Exchequer Court Act
raised against the crown through the necessity of having to go to the exchequer court and having to obtain a fiat before the crown can be sued. We are living in a changing world. To-day the crown is engaged in big business. To-day the crown is spending in its activities, including of course the armed forces, over half the national income. Never in the history of the nation has the crown been so much engaged in business as it is to-day, and not in the business of government alone. The crown is engaged in commercial business through various channels and organizations and agencies and commissions. I think the time has come when the right should be granted to the subject of his majesty, resident in Canada, to sue the crown in any court of competent jurisdiction based upon the domicile or residence of the claimant. Vice versa, the crown should have the right if it so wishes to sue the subject in any of these courts. I put this on the ground of changing operations of our national economy. There was a time when you could not sue the crown at all, and there are certain provinces which still deny to the subject the right to sue the crown. I think in my own province, unless the law has been altered within recent months, there is no opportunity of suing the government of New Brunswick on any ground, contractual or in tort, and that is very often a denial of justice. What does a man have to do? He has to go with his hat in his hand to the government of the day in the province of New Brunswick and get redress ex gratia, not as a matter of right. That is an intolerable situation. As my hon. friend the member for Rosedale remarks, it is a relic of the feudal system. We have in Canada a better system. We have a petition of right. But even there a man is not always certain that he will be able to get his case before an independent court. He has to run the gauntlet, we will say, of the Minister of Justice. I am bound to say that I have never known of a case, and I have had a good many cases in days gone by considering the limited practice I had, where, if one were able to make out a prima facie case, a fiat was refused. But there has been such delay, at times, and expense. You have to employ an agent in Ottawa and brief him with the facts if there is any dispute about the matter, and it is a costly system, a cumbersome system.
I am making a plea here and now for a change in the system so as to put the crown which now is developing into such a big business manager in the same category as the subject. The days of the feudal system are over; the days when the crown can be said
to do no wrong are long since past. The crown is often through its servants guilty of malfeasance and of non-feasance, and why should it not be subject to the jurisdiction of the provincial courts? Surely it cannot be that the crown would not get justice in the provincial courts, especially in this day when trial by jury of civil actions in the provincial courts has been very largely abolished by statute. I hold quite strong views on this subject, and I am stating them now in the hope that those charged with authority will give some consideration to them. I should like to have an expression of opinion from the membership of this house, especially those who belong to the legal profession.
I have in mind the case of a widow whose husband was killed through the allegedly gross negligence of an army truck driver. I have been endeavouring to obtain through certain departments of the government an explanation of the facts, what the inquiry disclosed, in order to permit the widow to get redress. I am not going into the details of the case, but if that woman has a cause of action, what redress will she have? I do not think she can ever bring action in the exchequer court. She has to depend on the good will, shall we say, of the authorities here in Ottawa if she can show that she has suffered the loss of her support by reason of the negligence of a servant of the crown. If this bill passes she has to go to the Exchequer Court of Canada to assert her rights. I suggest to the membership of this house that in this enlightened day and generation that is not good enough. She should be allowed to sue in the courts of her own province and have the case tried at the most convenient point in the county in which she lives. Anybody who has had anything to do with trials in the exchequer court knows that in the provinces the court sits once a year-oftener, I assume, if there is any quantity of litigation, but as a rule in New Brunswick it sits once a year, and if you start your action after the last session of court you have to wait a year for it to be tried. I could go on and argue this at great length and support the argument with cogent reasons, but I do not propose to delay the committee further. I hope that consideration will be given to the matter now, because it is important. It is a matter of justice to the subjects of His Majesty in Canada who may have a cause of action against the crown.
I think this bill is a matter of justice- that is, justice in the abstract. I am going to support the bill. The matter is already covered I think by order in council, but this
Exchequer Court Act

will make it part of the permanent substantive law of the country and it can be repealed only by act of parliament. I am sorry there are not more members of the legal profession here to-day, because I should like to hear their views. As for me, I have no manner of doubt at all, having regard to the multiplicity of activities in which the crown is engaged to-day outside of war altogether but due to the war, that the crown should be made liable for actions in tort for negligence on the part of its servants and in actions ex contractu and be answerable in a court of competent jurisdiction in the province in which the complainant resides.


Mr. HAZEN:: I think the Minister of
Justice is to be commended for introducing this bill to amend the Exchequer Court Act. When it becomes law, claims against the crown for death or injury to the person or for damages to property caused by the negligence of a member of the armed forces can be adjudicated by our courts.
There are one or two other amendments which in my opinion should be made to the Exchequer Court Act. One is the amendment which has been suggested by the hon. member for York-Sunbury. The crown can go into any of the provinces of the dominion and start an action against a citizen in any of our courts, and there is no reason why the citizens of any province should not be in a similar position. It seems to me that a citizen of any of our provinces should have the right to commence an action against the crown in any court of the province having jurisdiction in civil actions.
There is one other amendment to the act which I think should be made. The exchequer court was created by an act which came into force on October 30, 1887. Section 19 of that act provides that the court shall have exclusive original jurisdiction to hear and determine certain matters therein set out. Then follow a number of clauses setting forth the nature of the claims that can be adjudicated.
To quote from the judgment of Mr. Justice Newcombe in the case of the Canadian National Railways v. St. John Motor Line Limited (1930), 72, S.C.R., p.488:
These clauses must be read in the light of the decisions, of which the earlier leading examples are mentioned in the case of Ryder versus The King; and by these and the later authorities it is well established in this court that not only does the Exchequer Court acquire jurisdiction to adjudicate the classes of claims above described, but also that in such cases liability

is imposed upon the crown to respond in damages for the negligence of its officers or servants where, in the like circumstances, such a liability would rest upon a subject corporation or individual-
Here are the important words:

according to the law of the province in which the claim arose, as that law existed at the time when the Exchequer Court Act began to operate.
The exchequer court began to operate in 1887. Or, to put the matter in other words, when an action is brought for any of the claims enumerated under section 19, "liability was to be determined by the general laws of the several provinces in force at the time such liability was imposed," to quote the words of Mr. Justice, afterwards Chief Justice, Davies, in Armstrong v. the King (1908) 40 Can.



S.C.R., 229.

[Stage Direction]
The law of negligence in some of the provinces has been changed in more than one important particular since the year 1887, when the exchequer court came into being. In 1887 in all the provinces in which the common law prevailed a person could not succeed in an action for damages based on negligence if it was proved that he had in any degree contributed to the accident, or perhaps it would be better to say, if he was guilty of contributory negligence. To-day this principle has ceased to be law in several of the provinces. The admiralty rule that in such cases the damages were in proportion to the degree that the parties to the action were at fault has replaced the common law rule.
Again., in 1887 a person was entitled to damages if while being driven as a guest or invitee he suffered injuries through the negligence of his host. In. many of the provinces to-day, under our motor vehicles acts, we have what is known as the guest rule, which provides that a person who has accepted an invitation to be driven in an automobile cannot obtain damages for the injuries he sustains through the negligence of the owner of the vehicle or his servant. Neither of these laws is recognized by the Exchequer Court of Canada because they were not in force in 1887.
A resident of one of the provinces where these statutes are in force-let us say New Brunswick-brings an action in the exchequer court against the crown under section 19 of the act. The plaintiff claims he is entitled to damages because the law of the province in which he lives provides that under the state of facts that he can prove he is entitled to damages. The court says no, that does not necessarily follow; it is not what the law is in your province to-day that matters, but what matters is what the law in your province was in 1887.

Exchequer Court Act
The law of the province should govern in such cases. It is unsatisfactory for a citizen in any province to learn that the law of his province does not necessarily apply to actions which are brought by him in the exchequer court.
I feel very strongly that the Exchequer Court Act should be amended to provide that the provincial acts, such as the Contributory Negligence Act and the provisions of the motor vehicles acts respecting guests who are driven in cars, should be binding on the exchequer court, and I would ask the minister if he will not give that matter some consideration, discuss it with the officials of his department, and perhaps with the judges of the exchequer court as well.
It is an extraordinary situation, it seems to me, as I have said, that after a person brings an action for negligence in the exchequer court and states that under a certain set of facts he is entitled in his province to damages, the exchequer court says no, you are not entitled to damages because in 1887 the law of your province was not as it is to-day, or, because the law of your province was different. I submit that that is a wholly unsatisfactory state of affairs.
Richard Burpee Hanson: Anomalous.


Douglas King Hazen: Yes, it is an anomalous state of affairs.
I was going to speak about the matter which the hon. member for York-Sunbury brought up, that the subject should have the right to sue the crown not only in the exchequer court but in any other court of Canada. I think that steps should be taken to have an amendment or amendments made to enable that to be done.


Vincent-Joseph Pottier: I wish briefly to support the hon. member for York-Sunbury in his representation to the minister that consideration be given to having the Exchequer Court Act amended or power given to our various provincial courts, according to their jurisdiction, to try actions against the crown. I agree with the hon. member for York-Sunbury that the time is coming when we shall have to give these conveniences to the Canadian public. We are developing to the extent that we should leave behind this idea of having to come to Ottawa, go through a long procedure, issue a petition of right, and get the consent of the Minister of Justice to start an action. We should be more realistic.
I am glad also that this particular resolution has been brought in by the Minister of Justice. I think it is due and proper.


Mr. GREEN:: I should like to endorse the stand taken by the hon. member for York-Sunbury and the hon. member for St. John-Albert. I hope the Minister of Justice will explain fully to the committee why it is that provision has not been made along the lines they suggest. If our courts are to serve the public it is high time that these changes were made; and certainly it is very inconvenient that people living in the distant provinces can sue only in the exchequer court. It hits us particularly hard. I do suggest that provision be made for suing in our provincial courts.


Richard Burpee Hanson: I should like to urge upon the minister that the two matters referred to, first, by myself and more particularly the point raised by the hon. member for St. John-Albert are reforms that are long overdue. I am glad the hon. member for St. John-Albert brought up that point. It escaped my attention. I am pleased that he has made such a lucid exposition of the point. It is an anomalous situation that while jurisdiction is given under a statute to entertain an action, the statute creating the jurisdiction is so rigid that it fastens the claimant to the legal position as at the date of the passing of the legislation. It has neither flexibility nor regard to the changing conditions and the changing state of the law. I think the hon. member for St. John-Albert is to be congratulated upon raising that point, and in my opinion it is really of more primary fundamental importance than the point I raised myself. But the two points together should be considered by the minister and he should give effect to them.


Mr. ROSS (Calgary East):: They are both very important.


Richard Burpee Hanson: Yes.


Mr. NOSEWORTHY:: I cannot speak as a lawyer on this question, and I am not versed in the legal technicalities involved, but as a layman I have received, since coming to Ottawa, considerable correspondence regarding cases such as those referred to by the hon. member for York-Sunbury and others, and I have reason to know that there is a great deal of discontent in the public mind at the present time regarding the inability of the subject to get justice where the crown is involved. The hon. member for York-Sunbury called attention to the case of the King v. McArthur. I have a considerable amount of correspondence on that case from people who knew that man, who knew the circumstances and followed the case through the lengthy trial and read the lengthy report given upon it.
Exchequer Court Act


Richard Burpee Hanson: But the crown did raise this as a defence in that ease.
Mr. ST. LAURENT: The crown used to raise as a subsidiary defence that members of the forces were not servants of the crown within the meaning of the act. The learned judge in the McArthur case decided on both grounds, that there was not sufficient evidence of negligence and that in any event a member of the armed forces was not a servant of the crown within the meaning of the act. Had there been only that reason given it would have been proper to say, "If you are going to amend the act we will give the man in connection with whose case the matter arises the benefit of the amendment." But to determine or have determined by parliament, without consideration of the evidence, that that judgment was wrong on the facts would be something I would not care to recommend to the house.
About the other matters, I do thank hon. members for expressing their views upon the point. I will not make any long statement but will merely explain that the reason for the decision, that it is the law of 1887 that has still to be applied by the exchequer court, is of course the logical conclusion from the rule that the crown is not bound by legislation unless expressly mentioned. The crown accepted liability in 1887 for a certain situation as it then existed. No amendments made since can bind the crown unless the crown 
is specially mentioned and unless it is passed by competent authority. The provinces could not, even if they wanted to, extend their legislation in such a way as to increase the liability of the crown in the right of the dominion government, and the suggestion that is made is that we cancel that additional rule with respect to liability arising out of negligence. The old rule that the crown is not bound unless expressly mentioned is being applied-


Richard Burpee Hanson: It could be done another way.
Mr. ST. LAURENT: Well, it could be done from time to time; we could say: We will accept the situation as it is to-day.


Richard Burpee Hanson: Or as it may be in various jurisdictions.
Mr. ST. LAURENT: Well, that would be a contradiction of the rule and future legislation would affect the crown without its being specially mentioned. With respect to these prerogatives, they are sometimes referred to as having come down to us from feudal times, but there are still prerogatives in the crown that cannot be lightly wiped out of the general system of our laws. This matter will be given serious consideration. It would be of course a matter of government policy because it involves increasing the liability, but consideration will be given to the question whether or not it will be proper to accept the legislation as it exists at the present time. We know what that is. We know how far it goes.


Richard Burpee Hanson: At least that would bring us up to date.
Mr. ST. LAURENT: That would bring us up to date; and I do confess that since 1887 there has been a substantial change in conditions to which it is worth giving careful consideration. On the other point, as to whether or not jurisdiction to extend the claimant's case against the crown should be given to all provincial courts, that will be given further consideration, though I must say that it has been given careful consideration by several departments of government, and the reason the bill as it is was drawn in that way was that it was felt it would not be proper to have a system whereby in one section of the country an individual could recover from the crown, while, if he happens to live in another section of the country he would not recover from the same crown under exactly the same circumstances.


Richard Burpee Hanson: What is that? I did not hear that.

Exchequer Court Act
Mr. ST. LAURENT: "VVe want uniformity of liability on the part of the dominion government. The dominion government raises its funds from the whole Canadian people. We think it only proper that the liability of the crown to the subject should be the same no matter where the subject lives, and we feel that if we did not have the exchequer court to apply uniform rules to claims against the crown we might have claims being maintained in one portion of the country on facts with respect to which claims would not be maintained in another part.


Richard Burpee Hanson: In other words you say there would be different rules of law in different jurisdictions?
Mr. ST. LAURENT:	There would be
different rules of law and different degrees of latitude or elasticity in the application of the rules, and that was thought undesirable when dealing with the federal crown. Whether or not that be a good and sufficient reason, that is why no provision was made at this time for extending jurisdiction to the provincial courts. In that connection I may say that *the officers of the department will confer or are conferring-I think the matter is already under way-with the exchequer court officers to bring about a scale of costs that will not be out of proportion to what costs would be incurred in provincial jurisdictions. Moreover, a rule has been established that in motor accidents or things of that kind, where there is apt to be a counterclaim, we would not proceed in provincial courts, and thus put the defendant in the position where he could not assert a counterclaim. If we should proceed in a provincial court against a defendant because of a collision, and he should contend that the collision was the fault of our servant and that he should be the one to recover, he cannot urge his claim against us in a provincial court.


Richard Burpee Hanson: Under the
present system. '
Mr. ST. LAURENT: Under the present system. There were some cases in which that point had arisen, and we decided to withdraw those cases from the provincial courts and institute them in the exchequer court because we consider it only fair that if we are claiming we should make our claim in such form that if the defendant has a counterclaim to assert, he may submit it at the same time and have them both passed upon in one decision.


Gordon Graydon: Otherwise he would be very seriously prejudiced.
Mr. ST. LAURENT: He would be prejudiced; he would have to meet our claim in
the provincial court and then submit a new claim in the exchequer court and go all over the whole thing again.


Richard Burpee Hanson: That principle is sound.
Mr. ST. LAURENT: That is something we are going to avoid. We will not now, in connection with these claims, go to the provincial courts; not because we do not think we would get justice there, but because if we do go there we put the defendant at a disadvantage and in some instances prevent him from asserting his counterclaim.


Richard Burpee Hanson: Of course that could be taken care of by legislation here.
Mr. ST. LAURENT: It could be taken care of by legislation, but still it would involve restricting the prerogatives of the crown. Before I came to the department I had views on that matter, but I have not been in the department long enough to feel entitled to be too drastic in wiping out prerogatives which have come down through the centuries and which have justification to a certain extent. I confess that circumstances are not what they were in 1887. That is something to which we shall have to give serious consideration, but how far we can go is a matter to which we must give not only serious but careful consideration; for what we do is done for all time. You can never increase a royal prerogative, or at least I do not foresee that for many generations there will be any opportunity to add to these prerogatives of the crown. So that whenever you take something away it is definitely gone, and that makes it necessary to proceed with care.


Richard Burpee Hanson: I am in agreement with the last observation made by the minister. I am no iconoclast, yet I am not very much impressed by this question of the prerogatives of the crown. The crown still has a great many prerogatives. If you listen to what goes on in this house in connection with the expenditure of money you will realize that theoretically not a dollar can be spent unless the king's representative first recommends it, and that is a pretty strong position to take.
I think good may come out of this discussion. If time permits I hope the minister will discuss the matter with the officials of his department and if the opportunity offers I hope he will take it up in council. I am not very hopeful, for " out of sight, out of mind." I am of the opinion that one reason why jurisdiction has never been conferred upon the
National Revenue Act

provincial courts in connection with any of these actions is that there is a feeling in government that the present restrictive jurisdiction to bring actions against the crown does away with vexatious and frivolous actions. That may be true, and perhaps otherwise the crown would be sued very much more frequently than it is to-day; yet the case I have attempted to describe shows the hardship that may be imposed upon the subject. Here is a woman who is claiming under Lord Campbell's act, with her husband killed1 through the alleged negligence of what is now a servant of the crown, and she has to go to the exchequer court to get redress. I think in this twentieth century we ought to facilitate the position of people in that category.


George Henry Ross: The hon. member for York-Sunbury made a strong plea in favour of dispensing with the petition of right in the exchequer court. Is there any reason why that practice should be continued in the present day? Would not thirty days' or sixty days' notice that the man intended to sue be sufficient, without having to go to the expense of a petition of right?
Resolution reported, read the second time and concurred in. Mr. St. Laurent thereupon moved for leave to introduce Bill No. 134, to amend the Exchequer Court Act.
Motion agreed to and bill read the first time.
At one o'clock the house took recess.
The house resumed at three o'clock.
Hon. L. S. ST. LAURENT (Minister of Justice) moved the second reading of bill No. 134, to amend the Exchequer Court Act.


[Stage Direction]
Motion agreed to, bill read the second time, considered in committee, reported, read the third time and passed.


[Stage Direction]
Hon. C. W. G. GIBSON (Minister of National Revenue) .moved the second reading of Bill No. 108, to amend the Department of National Revenue Act.
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Bradette in the chair.
On section 1-Deputy ministers.
Richard Burpee Hanson: I gather that this is purely an administrative bill. The

explanation made some time ago by the minister would seem to be satisfactory. I understand the status of the commissioner of income tax and commissioner of succession duties has been raised to that of deputy minister.


Mr. GIBSON:: That is so.


Richard Burpee Hanson: Heretofore he has not had the status of deputy minister.


Colin William George Gibson: He has had the power, but not the rank and status.


Richard Burpee Hanson: But not the title.


Colin William George Gibson: Correct.
Mr. HANSON (York-Sunbup'O: Does the promotion carry anything with it? Will he receive an increase in salary?
Mr.	GIBSON:	Not unless an increase	is
provided by order in council appointing the deputy minister.
Mr.	HANSON	(York-Sunbury):	What	is
the salary of the income tax commissioner?


Colin William George Gibson: 

Mr.	HANSON	(York-Sunbury):	What	is
the salary of the commissioner of customs?


Colin William George Gibson: They are both at $9,000.
Other deputy ministers range from $8,000 to

Mr.	HANSON	(York-Sunbury):	I understand $9,000 is the minimum?


Colin William George Gibson: I understand that there are some at $8,000.


Richard Burpee Hanson: This is now a very important position. With the amount of business passing through his hands, the chief taxing officer in the country carries heavy responsibilities. I should think his duties are as heavy as, if not heavier than, those of any other deputy minister, with the possible exception of the deputy ministers in the defence departments. I suggest, so far as I am concerned, that consideration be given to placing the salary at least at a point equal to those of other deputy ministers. It ought to be $10,000. I do not believe the salaries of our chief executives, notwithstanding what some people may say, are excessive. I do not think we could hire legal men with their training for $10,000. Speaking for myself, I would say they ought to be paid good salaries.


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

Tax Convention Act


[Stage Direction]
Hon. C. W. G. GIBSON (Minister of National Revenue) moved, the second reading of bill No. 119, respecting a certain tax convention and protocol between Canada and the United States of America, signed at Washington in the United States of America, on the 4th day of March, 1942.
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Bradette in the chair.
On section 1-Short title.
Richard Burpee Hanson: This is an important bill and I must confess that I have not been able to give it the consideration it deserves. The minister ought to take advantage of this occasion to explain the effect of the various provisions of the convention, especially upon international business and firms and enterprises that are international in scope. I gather that this convention has some ameliorating effect upon taxation, although I am not sure as to that. I hope there is an effort to avoid certain features of double taxation.


Colin William George Gibson: The convention and protocol was considered by this house and approved by resolution on June 8, 1942. At that time all the details of the convention were explained and dealt with. It was felt at that time that a resolution of this house was all that was required, as that is all that had been passed in connection with a previous convention in 1936. However, the Department of Justice expressed the opinion that this should have the approval of both houses, and consequently this bill has been brought in.


Richard Burpee Hanson: What was the basis of their opinion?


Colin William George Gibson: It affects finances to some extent, because there is a change in taxation rates as between the countries.


Richard Burpee Hanson: Heretofore it has been considered that only a resolution was necessary to give effect to what really is a treaty, but the Department of Justice now rules that it should be done by an act of parliament. There is an important distinction there, as the minister will appreciate. I think perhaps the department is right in principle.


Colin William George Gibson: The opinion we received
was that "in order to give legal effect to the
convention it is necessary that it be confirmed by statute." That was not amplified in any way. There are parts of the income tax act, especially the secrecy provisions, which are being overridden by this convention, and I think possibly that is one reason for the opinion.


Gordon Graydon: The minister said that on a previous occasion a resolution of this house was considered all that was necessary with respect to a convention or protocol of this kind. What would be the position now of that previous convention or protocol in view of the opinion of the Department of Justice?


Colin William George Gibson: The convention of 1936 provided that each country would charge five per cent tax on the incomes going to residents of the other country. When we raised our tax, the previous became non-operative, and it was replaced by the convention passed in 1942.


[Stage Direction]
Section agreed to.
On section 2 - Convention and protocol approved.
Richard Burpee Hanson: Apparently the minister is of the opinion that the previous discussion was quite sufficient, and perhaps he is right. Will he indicate in a general way the changes which are being effected by the various articles?


Colin William George Gibson: A previous convention with the United States provided for a five per cent tax on income going into either country. Eventually Canada raised that tax to fifteen per cent, with the result that the previous treaty was abrogated and automatically a sixteen and a half per cent tax went on against Canadians, this being raised later to twenty-seven and a half per cent. This tax was deducted at the source in the United States from dividends coming to Canada. This convention was then entered into with the United States to restore the equality of treatment and bring the tax dowm. to a level of fifteen per cent in each country.


Gordon Graydon: We were getting the worst of the bargain.


Colin William George Gibson: The United States now charges thirty per cent in the case of countries which do not have an agreement.


[Stage Direction]
Section agreed to.
Sections 3, 4 and 5 agreed to.
Schedule agreed to.
Richard Burpee Hanson: Before the bill is reported I should like to ask one question. Does a wholly-owned subsidiary of

Tax Convention Act

a United States company-General Motors is a case in point-pay a tax on dividends going to the parent company in the United States, and is the reverse the case also?


Colin William George Gibson: They do not pay a tax; we can tax them, but we do not.


Richard Burpee Hanson: Is it
reciprocal?


Colin William George Gibson: We have a reciprocal right to tax.


Richard Burpee Hanson: We have the right to tax the dividends of General Motors of Canada going to General Motors in the United States, but we do not do it. The minister might elucidate that point. Are the dividends paid by a subsidiary of a Canadian company operating in the United States to the parent company taxfed?


Colin William George Gibson: There is a five per cent tax on dividends coming from the United States to a parent company in Canada.


Richard Burpee Hanson: The situation does not seem to be wholly equitable.


Colin William George Gibson: It is a matter of policy for this government that the tax has never been applied in this country, although we have the right to put it on.


Richard Burpee Hanson: Why should not there be equality?


Colin William George Gibson: It is a matter of policy.


Richard Burpee Hanson: Upon what is the policy based?


Colin William George Gibson: The policy is set by the government with the advice of the Minister of Finance. It may be as an encouragement to United States companies to establish subsidiaries in this country. That would be one reason.


Richard Burpee Hanson: That would be one basis for the policy, but I am wondering why Canadian parent companies have to pay taxes on dividends from their United States subsidiaries when the United States companies do not have to pay on dividends from their subsidiaries in this country. It seems to me that they should be on exactly the same basis. There may be a good reason, and if there is I should like to know what it is. If it is merely to encourage capital to come into the country, then that argument will have to stand on its own feet. Why should there not be reciprocity in the matter?


Colin William George Gibson: We have reciprocity as far as the right to put on the tax is concerned. Under this convention we have the right to

put on the same tax as the United States does, but this country has not seen fit to put on such a tax.


Richard Burpee Hanson: And the reason is the one given.
Bill reported, read the third time and passed.



MINERAL RESOURCES


[Stage Direction]
Hon. T. A. CRERAR (Minister of Mines and Resources) moved the second reading of bill No. 78, respecting the British Columbia Indian Reserves Mineral Resources Act.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Bradette in the chair.
On section 1-Agreement confirmed.
Mr. CRERAR:: Mr. Chairman, it may be of assistance to the committee if I make a few brief comments on the bill now under consideration.
There are at present over 1,600 Indian reserves in the province of British Columbia. To relate the history of these reserves and the various discussions and negotiations that have taken place down through the years between the provincial government and the federal government would fill a good-sized volume. The first reserves were set aside when British Columbia was a colony, in pre-confederation days. Under the British North America Act, as hon. members are aware, the responsibility of looking- after the Indians is a federal responsibility. In British Columbia provision was made at the entry of that province into confederation for setting aside additional reserves as they became necessary. Various commissions of investigation were set up, one in 1875-76, to select reserves, but generally speaking the laws of British Columbia provided that the complete reversionary interest in the lands set aside for Indian reserves remained with the province. As a result of that, legal obstacles existed to the use of the reserves for the benefit of the Indians. For instance, if a portion of a reserve were surrendered it reverted to the province, and the province could sell it. If there were merchantable timber on the reserve, no disposition could be made of it without the proceeds going back to the province. That condition of affairs continued, generally speaking, until 1912, when both governments recognized that it was necessary to clear up the situation with regard to

Indian Reserves Mineral Resources
the resources on these reserves. Accordingly the McKenna-McBride commission was set up to determine the extent of the reserves and to consider matters generally affecting the Indians. That commission reported, and in 1919 an agreement was drawn up in accordance with the recommendations of the commission providing for the settlement of many of the outstanding difficulties. For some reason or another action was not taken on this agreement for many years, and it was not until 1938 that the lands were conveyed by the provincial government to the federal government.
To go back a little, a question arose as to the ownership of the minerals which might be found on lands transferred to the dominion in British Columbia, and a test case was taken to the privy council to decide the ownership of the precious metals. The privy council gave judgment that the precious metals belonged to the crown in the right of the province.


Richard Burpee Hanson: Has the minister the citation?


Thomas Alexander Crerar: The case was decided in 1889. An extract from the judgment of the privy council reads:
The precious metals in, upon and under crown lands, are not incidents of the land but belong to the crown, and, under section 109 of the British North America Act, 1867, beneficially to the province.
That judgment, of course, established that if precious metals were found on such lands, the dominion had no claim to any benefits arising from the exploitation of these precious metals.


Richard Burpee Hanson: They belonged to the crown in the right of the dominion?


Thomas Alexander Crerar: No, the judgment was that they belonged to the crown in the right of the province, and consequently on Indian reserves they could not be utilized by federal authority for the benefit of the Indians.


Richard Burpee Hanson: I see.


Thomas Alexander Crerar: But that left the ownership of the base metals undecided. The government of British Columbia has not receded from the position that the base metals also belong to the crown in the right of the province, while the dominion government has held that they belong to the crown in the right of the dominion for the benefit of the Indians concerned.
During Premier Pattullo's tenure of office in British Columbia I had several discussions with him on this point with a view to having
it cleared up. The result of all the discussions which have taken place is really crystallized in the bill which we have before us.


Richard Burpee Hanson: Not in
the bill but in the agreement.


Thomas Alexander Crerar: In the agreement, yes; I accept the correction of the hon. member for York-Sunbury.


Mr. COLD WELL:: May I ask on what
grounds you separate the base from the precious metals in a contention of this kind? Both are underground; would not both be subject to the same jurisdiction?


Thomas Alexander Crerar: The case before the privy council which I mentioned a moment ago covered only precious metals. As I stated, the province of British Columbia had refused to concede that it had not possession of the base metals as well.


Major James William Coldwell: I understand that.


Thomas Alexander Crerar: On the other hand that can be settled only through the courts, because the federal government held-I am not familiar with the precise legal reasoning in the matter-that the right to the base metals is with the crown in the right of the dominion for the benefit of the Indians. To cover this point an agreement was reached with the province of British Columbia relating to the manner in which the mineral resources on these Indian reserves might be developed. I am bound to say I think that in the agreement reached the British Columbia authorities have taken a fair position. Perhaps from their point of view it seems a generous agreement in this regard. At any rate the agreement has been reached.


Gordon Graydon: Is it a fair agreement from our point of view?


Thomas Alexander Crerar: I shall deal with that in just a moment. If a difficulty arose, if it were determined that ownership of the base metals rested in the crown in the right of the dominion for the benefit of the Indians, we would have the dominion government for the Indians controlling the disposal of the base metals, and under the privy council judgment we would have the province of British Columbia controlling the disposal of the precious metals. Precious metals and base metals are frequently found in combination, and it does not require much imagination to see the problems and the difficulties which would arise under that condition. Consequently the agreement covers this. The provisions of the agreement which is being
4922	COMMONS
Indian Reserves Mineral Resources
ratified under this legislation are that the prospecting and the development of minerals on the reserves shall be under the laws and regulations of the province of British Columbia; that is the province will issue permits to prospect, permits to develop, but only after the Indians concerned have given their agreement to it in the ordinary manner which is provided for in the Indian Act.


Thomas Miller Bell: That is the meaning of the reference here to getting the permission from the Indian agent? I understand that getting permission from the Indian agent means that the Indians themselves concur?


Thomas Alexander Crerar: Yes, that is provided for in the Indian Act. The matter is placed before the Indians and they vote in the manner determined in the Indian Act as to the surrender of these minerals, and then the prospecting and development follow and are done under the laws and regulations of the province. There is a provision that the royalties or the revenues which are derived at present by the province under its laws from mining development cannot be reduced so far as these reserves are concerned without the consent of the federal government. In other words, those royalties and dues, if one may term them such, at present in force in British Columbia, are, I believe, as high as or higher than they are in most of the other provinces, and they cannot be reduced by the province as regards the minerals on these reserves without the consent of the federal government. The revenues derived from the exploitation of these minerals on reserves, whether they are derived from gold or from base metals, are divided equally between the provincial authority and the federal authority; the federal authority using them, of course, in trust for the Indians concerned.


Major James William Coldwell: What use may the provincial authority make of the funds?


Thomas Alexander Crerar: They become part of the ordinary revenues of the province, and can, I suppose, be used in any way in which the province wishes to use them. What is sought in this bill, then, is confirmation of the agreement reached with the province of British Columbia covering the disposal and handling of these minerals on Indian reserves which may be found from time to time. I do not think there is anything I need add in explanation of the measure.


Howard Charles Green: Is the share of the money which comes to the dominion held in trust for the particular tribe living on the reserve where the mine is situate?
[Mr. Crerar.l


Thomas Alexander Crerar: Yes, it is held in trust for the Indians on the particular reserve.


Grote Stirling: The basis of the agreement arrived at between the dominion and the province results in an arrangement by which one-half of the revenue collected goes to the one and one-half to the other. Is that arrangement arrived at by an understanding that the values of the precious metals and the base metals are similar? The question arises in my mind, what to-day is a precious metal? Of course, gold and silver; but several other extremely valuable metals are now mined, a good many of them in British Columbia, which to-day may come under the category of precious metals. I should like the minister to explain on what basis the arrangement of fifty-fifty has been arrived at.


Thomas Alexander Crerar: Well, ordinarily in the past such metals as gold and silver have been regarded as precious metals.


Grote Stirling: Platinum?'


Thomas Alexander Crerar: I am unable to say whether or not platinum comes within the definition of precious metals. I am inclined to think that it does. In any case, whatever the regulations of the province may be in regard to royalties or the revenue secured from gold or silver or platinum or any other metal, base or precious, that scale of royalties and revenues cannot be reduced, as I have stated, without the consent of the dominion. Now, that maintains the existing scale of fees or royalties upon which the province derives revenue from the development of these minerals, that is over the province generally. In the second place there is no need, it appears to me, to draw any distinction between gold or minerals carrying gold and ores carrying, say, copper. I cannot at the moment say what the provincial government scale of royalties is, but assume for the sake of argument they have one scale of royalties for gold, another scale for copper, another scale for zinc. In any case these royalties apply whether the development on the reserye is gold, copper, zinc or all three, and consequently the interests of the Indians in that regard are fully protected. There is a definite advantage to the Indians of British Columbia in this arrangement, because it clears up any doubt that may exist as to the degree to which they might be able to participate in the development of minerals on the reserves. It establishes clearly and definitely what I think is a fair, if a somewhat rough and ready, rule for the benefit of the Indians. I will admit at once that if on these reserves base metals were found in large

Indian Reserves Mineral Resources
quantities and it could be established that the federal government had the right to the development of these for the benefit of the Indians, then possibly on balance the welfare of the Indians might suffer a little. On the other hand, if any future development were mainly in the precious metals, then the province would not do so well. As I have already stated to the committee, this is a rough and ready method of settling what has been a contentious subject and on a basis which, on the whole, I believe, will not detract anything in the end from the total revenues of the Indians by and large, having regard to what the situation would be if the matter were left in any uncertainty or doubt.


Alan Webster Neill: The general principle of this bill is undoubtedly good because it does away with the objection that has been in existence for many years in British Columbia, that if the Indians-or anyone acting for them-discovered a valuable mine, it could never practically be worked because the other party, the provincial government or the dominion government, would step in and say, "You may take out your silver but you must not touch our lead, for instance." It ended practically in the Indians being deprived of any benefit whatever.
There are a couple of discrepancies, as I understand the bill. The explanatory note does not accord with the agreement. I was given to understand, in conversation with some of the officials, that the first procedure would be to obtain the consent of the particular band of Indians to surrender these minerals, and it was so stated in the explanatory note. The note has no legal effect whatever. It reads:
Briefly the arrangement provides that upon surrender by the Indians the administration, control and disposal of the minerals and the mineral claims shall be subject to the laws of the province.
That appears in the explanatory note which, as I say, has no legal force whatever. The real thing that does bind these people is to be found on page 3 of the bill:
The administration, control and disposal of all minerals and mineral claims, both precious and base, in, upon, or under all Indian reserves in the said province shall be subject to the laws of the province. . . .
"Shall be": in other words, the moment this bill is passed the Indian has no say at all in the matter. On the other hand the minister may point to the following provision which appears lower down on the same page:
And provided further that no prospecting or right of entry on the said Indian reserve shall be authorized or permitted until permission so
to do has been obtained from the Indian agent for such reserve; such permission shall be subject to such terms and conditions as the said Indian agent may specify and shall be granted only to such persons whose application for permission has been approved by the gold commissioner for the mining division of the province in which such reserve is situated.
That takes care of the white man and of the provincial government but not of the Indian. Elsewhere it states that on the passing of this act all these minerals shall come under the control of the province. I maintain that the procedure hinted at in the explanatory note, which, I repeat, has no force, should have been maintained, to surrender all the rights of the Indians in that particular reserve and, in the regular way, to have the Indian agent call a meeting of the band, whereupon he would ask if they would surrender the minerals on the reserve. Of course they know then what the deal is, and they would give their consent with a knowledge of the terms and so on. Anyone can come to prospect on the reserve-that is quite all right- but only with the consent of the Indian agent, and he may make such terms and conditions as he thinks fit. The act should be so worded as to provide that the protection afforded the Indian with regard to their consent will be safeguarded as in the Indian Act.
There is another objection I see, to which I would call the attention of the minister. I am sure it was not intended that we should arbitrarily take away the ownership of these minerals from the Indians without their consent. It is provided in the old act' that nothing may be alienated without the consent of the band being obtained, and that is as it should be; but in section 7 of this bill it is provided that the province shall run the whole thing, collect all royalties and so on, and give the dominion government one-half. That, too, is all right; but it enacts that the province shall not be liable to the dominion for failure to collect the revenue or any portion of it by reason of the neglect or failure of any officer or servant of the provincial government or of the department of mines of the province to carry out his duties in connection therewith. That is a very unfair provision. By force of law you will take the minerals from the Indians, admittedly a good thing, and make a deal with the province by which they will run the business and give the dominion one-half. But if they fail to do it, if some official neglects his duty, some servant of the province, the Indian is out of luck.
If you make a deal in a business way you are under obligation to carry it out; and it is not sufficient for me, if I enter into an

Indian Reserves Mineral Resources
agreement with someone and my servant does something that contravenes the agreement, to turn round and say: "I am not responsible; you had better see him." The deal is between the dominion and the province, and if the province agrees to collect the money, it should be responsible except where it is impossible to make the collection. It should not apply where there is wilful neglect on the part of an officer or servant of the provincial government. He might steal money, for instance, and the province might very well say that section 7 absolves it from liability. If the province fails to collect the money it should be liable. It is not sufficient for the province to say that one of its servants ran away with the -money. As I say, the provision should apply only where the failure to comply with this part of the agreement is unavoidable. If they made a deal with a mining company and the company went bankrupt and could not pay, then I would say it was not the business of the -province to pay what should have been collected; but where it is a matter of sheer negligence or malfeasance on the part of an officer, a man stealing money, for example, the dominion as trustee and careful guardian of the rights of the Indians should protect these people in such a way as to enable them to collect from the province whose servant was responsible.


Thomas Alexander Crerar: On the face of it there is some force on the point raised by my hon. friend. I do not see, however, where there could be any failure by which the Indians would suffer. It could not arise without the province suffering equally. If the servant of the province who has to do with the administration stole money he would be stealing the province's money as well as the Indians'. If he were negligent he would be negligent in his service to the province as well as to the Indians.
This agreement was the result of a rather rough and ready way of settling a contentious dispute. There is this to be said, that the province bears all the cost of administration and yet 50 per cent of the revenues derived are paid in for the account of the Indians.


Alan Webster Neill: Is it the gross revenue or the net revenue?


Thomas Alexander Crerar: It will be 50 per cent of the revenues received, according to the information supplied to me on that point. So that I do not think there is really any very serious obstacle to the ratification of this agreement in
IMr. Neil!.]
the point raised by the hon. member for Comox-Alberni, though I recognize that there may be some force to it.


Alan Webster Neill: What about the surrender?


Thomas Alexander Crerar: On that point the agent will be governed by the instructions of his superiors. The Indian Act provides the basis upon which surrenders may be made, but as I recall it the act also provides in certain cases that if a band of Indians persists for some reason in pursuing a course that is really detrimental to their own interests, action may be taken to overcome that situation. I should say that in the actual administration of this matter the general terms and provisions of the Indian Act will govern, as they govern in other, similar matters.


Alan Webster Neill: Quite so; that would be the case if you had left the act as it was or if you had said that this procedure would be subject to the ordinary provisions of the act. But here you are devising something to take the place of the section of the Indian Act which now says you cannot take land away from a band of Indians without their consent, without calling a public meeting, and so on. There may be provision for dealing with extreme cases, in regard to the right of way for a railway, for example, but that is an extraordinary circumstance. The general principle laid down is that Indians may not be deprived of anything belonging to them without their consent, but now you are going to substitute the power of the Indian agent who can make conditions under which someone may go prospecting. I think it was intended originally that the right of the Indians should be surrendered in the usual way, and the explanatory note says so:
Briefly the arrangement provides that upon surrender by the Indians the administration, control and disposal of the minerals and the mineral claims shall be subject to the laws of the province. . . .
But that is only in the explanatory note, not in the bill. Nothing is said in regard to the surrender, however; it only states that the Indian agent may do certain things.


Thomas Alexander Crerar: I think it may be assumed-


Alan Webster Neill: Well, we cannot assume things.


Thomas Alexander Crerar: Yes, I think it may be assumed that in the administration of this matter the provisions of the Indian Act will be observed. It is quite true that it does not say so specifically-


Alan Webster Neill: Why not?

Indian Reserves Mineral Resources


Thomas Alexander Crerar: I do not know why, but that has been the practice in the past. The Indian Act provides for surrender being obtained from the Indians under certain conditions; but if a band of Indians, through some mistaken idea, follow a course that is against their own interest, I think I am right in saying that the administration has the right to overrule the Indians.


Alan Webster Neill: That is only in an extreme case, and it is left to the judgment of the department, not to the whim of an Indian agent.


Thomas Alexander Crerar: Oh, well; this will not be left to the whim of an Indian agent. An Indian agent would not act in a matter of this kind without consulting his superiors.


Gordon Graydon: As I see it, the question is not whether an Indian agent would or would not act. The question is, can he or can he not act; because if we give the Indian agent power, neither the government nor anyone else can say to him that he should not take this particular step. The fact is that we should so frame the legislation that there is no question of interpretation or assumption connected with it. The whole situation comes down to this, that if, as the hon. member for Comox-Albemi has pointed out, the Indian Act makes certain provisions, we should have something more than the minister's statement that he assumes the provisions of the Indian Act will be followed, or that he is quite sure nothing will be done contrary to its terms. It seems to me that good legislation, well drawn, would leave no room for doubt and would make it unnecessary for the minister to interpret the legislation, as he is attempting to do now. That is a job for the courts, not for the minister.


Thomas Alexander Crerar: I am not attempting to
interpret anything.


Gordon Graydon: Well, the minister has mentioned certain assumptions, and so on. I think the point of the hon. member for Comox-Alberni is well taken. If the terms of the Indian Act are to be read into the statute by those administering it, then they should be written into the statutes by those who are enacting it.


Alan Webster Neill: I suggest an amendment, and a few words would do it. I would suggest that section 2 be amended, to begin with these words:
Upon the surrender of the minerals in any reserve, according to the terms of the Indian Act, the administration . . . shall pass to the province.
Then the surrender would have to be obtained in the usual way.


Thomas Alexander Crerar: Of course this agreement has been confirmed already by the legislature of British Columbia.


Alan Webster Neill: But we are legislating in
behalf of the Indians. We are their guardians; we are not worrying about what the province has done. We are putting through legislation that will affect the Indians, and I say they are not getting the full protection to which they are entitled. If you inserted the words I have suggested, they would be protected.


Thomas Alexander Crerar: As a matter of practical observation I think the hon. member for Comox-Alberni is tilting at a windmill.


Alan Webster Neill: Well, I was an Indian agent for ten years, and I know how the Indians look at these things.


Thomas Alexander Crerar: I know also how the Indians look at these things. In actual practice what would happen to an Indian agent who, of his own volition, gave away rights in connection with these matters? He would not long be there. My hon. friend knows as well as anyone that the Indian agent must carry out his duties in conformity with the instructions issuecl to him.


Alan Webster Neill: Oh, no.


Thomas Alexander Crerar: Absolutely; and in this case the procedure unquestionably will be that provided in the Indian Act for the disposition of assets on reserves. While it does not so state specifically in this agreement, I think to assume anything else is not in accordance with the practice of the Indian department or with common sense. It may be that my hon. friend is quite right when he says the agreement couldi have been drafted in clearer terms on that point. I am willing to concede that, but the province of British Columbia has passed legislation approving this agreement. It took a great deal of effort and persuasion to bring them to that point, and now if we should say, " We are not quite satisfied with this agreement and we want to amend it further," they might reply, "Well, we are through with it." I have no hesitation in saying that the settlement of these contentious points by this agree-
.	COMMONS
Indian Reserves Mineral Resources
ment is m the interests of the Indians of British Columbia. I think my hon. friend will agree with that; there can be no question of it.


Alan Webster Neill: I have said so already.


Thomas Alexander Crerar: That being so, I am prepared to recommend to the committee that we pass this confirming legislation now.


Gordon Graydon: Of course the fact that the minister has brought in the bill indicates that he is recommending it to the committee, but I think he has to go a little further than that. I am interested in this. I know that the minister and the government, to put it in a more or less vulgar term, are rather on a spot in this matter, because of the fact that the agreement has already been signed. The bill itself is a matter of only two or three lines stating that the schedule to the act shall be confirmed and shall take effect according to its terms. I should like to ask the minister if, in the negotiations between the province of British Columbia and the dominion government, the question raised with respect to the provisions of the Indian Act applying in the event of surrender was discussed.


Thomas Alexander Crerar: No, not so far as my recollection goes. It was not mentioned at all, because how the Indians might give it up was not a question of concern to the province. What the province was interested in was the question of the disposition of a contentious matter, and the question of clearing up the matter of revenues, and the development of resources, should they be found. That was wrhat the province was mainly interested in. I have not the slightest doubt that if we had put into the agreement the most stringent possible terms to the effect that the vote of the Indians would be required, or a three-quarters vote would be required, or anything of that kind, the province would not have raised the slightest objection.
The point of criticism raised by the hon. member for Comox-Alberni is that we are giving too much power to the agent on the reserve.


Alan Webster Neill: Too much power to the Indian agent.


Thomas Alexander Crerar: Yes.


Alan Webster Neill: Instead of to the Indians, to whom it belongs.


Thomas Alexander Crerar: But my answer to that is that, in effect, we are not giving power to the Indian agent. The Indian agent must carry out the instructions, regulations and

conditions of the Indian Act. I have not the slightest doubt that these surrenders will be secured in all cases from the Indians in accordance with the terms of the Indian Act, and in accordance with the practice that has obtained in connection with Indian administration all through the years.


Alan Webster Neill: If I were an Indian agent this is what I would look at:
,.^le. administration, control and disposal of all minerals and mineral claims, both precious
d base, m, upon or under all Indian reserves in the said province shall be subject to the laws ot the province.
_ Does the minister say that that conveys any instruction to me to go out and get the consent of the Indians? Not at all. The old Indian Act states that before any disposition of Indian lands shall take place, the Indians shall be called together, and that their consent shall be obtained. This deprives them of that opportunity, because it says the administration from this day on shall be subject to the laws of the province. What is the use of asking the Indians to release something that has already been taken away from them? The minister says he is sure that the Indian agent will do so-and-so. Well, if he knew Indian agents as well as I do he might not be so sure. Why bring legislation here if the form of the whole procedure is to be based on someone presuming that somebody else will do something else. The Indian agent does not have to do it, because the moment this bill becomes law and this parliament passes the legislation the administration and control will be subject to the laws of the province. IVhat is the use of asking a group of Indians to give up their rights on a reserve which, so far as this bill goes, have already been taken from them?
The minister was wise in bringing this bill in and, as I said, it is a good thing and it will be beneficial to the Indians and the province as well. But the province is looking after the province, and we are looking after the Indians, and wre are taking away from them something which is a fundamental right. You do not take property or land away from the Indians, without the consent of the majority of Indians. The procedure is laid down. A meeting .must be called by the Indian agent-
I do not remember whether every adult votes or only male adults, but anyway it is a procedure which has to be taken.


Thomas Alexander Crerar: The agreement deals, at page 3, with the question of prospecting, or the right of entry to an Indian reserve. These are the words used:
And provided further that no prospecting or right of entry on the said Indian reserve shall

Federal District Commission
be authorized or permitted until permission so to do has been obtained from the Indian agent for such reserve; such permission shall be subject to such terms and conditions as the said Indian agent may specify.


Alan Webster Neill: Yes.


Thomas Alexander Crerar: And it continues:
-and shall be granted only to such persons whose application for permission has been approved by the gold commissioner for the mining division of the province in which such reserve is situated.


Alan Webster Neill: That applies only to
prospecting.


Thomas Alexander Crerar: And it states further:
And provided further that base minerals and mineral rights shall only be subject to this agreement upon being surrendered pursuant to the Indian Act.
I overlooked that provision when I spoke a moment ago in reply to the hon. member. But it will be noted that it is specifically stated there that surrenders are subject to the provisions of the Indian act, in that regard.


Mr. MACKENZIE (Vancouver Centre):: Certainly it does.


Mr. HANSELL:: I am not going to protest about the bill, or argue whether it is right or wrong, nor shall I speak about its virtues. But I do protest against the procedure being adopted. Perhaps this procedure has been taken for a long time, but the fact is that we are asked to pass a bill approving of an agreement already signed. I am at a loss to know what would happen if the house were to refuse to pass the bill. Would the minister care to tell us, or would' the Minister of Justice, who is in his seat, give us his opinion? It appears to me that a bill of this kind makes a member of parliament a sort of rubber stamp. This agreement has already been signed, and the bill is to be passed simply to ratify the agreement.


Ian Alistair Mackenzie: If the hon. member will read the last paragraph at page 2 of the schedule he will find this:
Now therefore this agreement v'itnesseth that the parties have mutually agreed, subject to the approval of the parliament of Canada and the legislature of the province of British Columbia.
So that it is clear that the agreement is invalid unless approved by parliament.


Thomas Alexander Crerar: I can tell the hon. member what will happen. If parliament does not confirm the agreement by this measure, then the agreement falls to the ground and we revert to the old state of confusion and uncertainty.


Gordon Graydon: It could be renegotiated.


Thomas Alexander Crerar: What position would we be in to go back and renegotiate it? But that was not the point raised by the hon. member for Macleod.


Gordon Graydon: The minister suggests that there might be some difficulty in going back to the province. But only a moment ago he said that if we had asked for this, the province would have allowed us to put it in.


Thomas Alexander Crerar: But it is in the act now. My hon. friend had better read the bill. The point raised by the hon. member for Macleod is this: He says, "You have an agreement; what is the sense or the need of having an act of parliament to confirm it?" The agreement expressly states that it shall not go into effect until confirmed both by the legislature of British Columbia and by the parliament of Canada. The legislature has confirmed it, and we are now asking parliament to do the same.


Ernest George Hansell: In other words I understand the minister to say that the agreement is not at present in effect?


Thomas Alexander Crerar: No.


Ian Alistair Mackenzie: It cannot be.


[Stage Direction]
Section agreed to.
Schedule agreed to.
Bill reported.
Thomas Vien: When shall the bill be read a third time? Now.


Some hon. MEMBERS:: Carried.


Alan Webster Neill: On division.
Bill read the third time and passed.



FEDERAL DISTRICT COMMISSION


[Stage Direction]
Mr. D. C. ABBOTT (Parliamentary Assistant to the Minister of Finance) moved the second reading of bill No. 71, to amend the Federal District Commission Act, 1927.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Bradette in the chair.
On section 1-Period for payment of annual grants extended.
Thomas Reid: I thought that this appropriation would be dealt with by the Minister of Public Works (Mr. Fournier), but as the bill is now before us and we have an opportunity of discussing it I should like to make one

Federal District Commission

comment. Personally I think it was a mistake to place the care of the grounds in Ottawa in the hands of the federal commission. I understand that this year for reasons of economy, they are not placing flowers in the different grounds, but we should not forget that there are sixteen or eighteen representatives of different countries located in Ottawa, and with the visitors who come to this city there should be no lack of flowers.


Mr. ABBOTT:: There will be an opportunity under public works estimates to discuss the maintenance of the grounds about the parliament buildings and other public buildings in Ottawa. This grant of $200,000 has been made for some years to the federal district commission, primarily for the maintenance of the parkway system. Under the Federal District Commission Act, 1927, provision was made for a grant of $250,000 for ten years. Subsequently, in consideration of a capital sum of $3,000,000 which was made available for large scale improvements, largely in central Ottawa, the grant was reduced to $200,000 a year in 1928. That grant expires this year and the bill now before the house provides for the continuing of this grant of $200,000 for another ten years.


Gordon Graydon: I understand that this
bill is a replica of the one passed in 1928, which expired on March 31, 1943, except that the term in the previous bill was fifteen years, whereas in this bill it is for ten years. I should like to know the underlying reason for this change in the length of time during which the grant is to be paid.


Douglas Charles Abbott: I am informed that there
is no special reason except that it was not thought appropriate to ask for an increase in the grant until the war was over. As the hon. member for New Westminster (Mr. Reid) has indicated, because of war conditions the work being carried on has been cut substantially. It was felt that authority should be asked to appropriate $200,000 for ten years, and the matter could be reconsidered after the war is over.


Ernest George Hansell: I am not opposing the bill, because I am not anxious to be continually reducing expenditures. We get beauty by spending money, not by saving it. I am in favour of the bill, but I would make one suggestion. When parliament is ready to grant $200,000 a year for the purpose of beautifying Ottawa, I think the city should try to follow suit in some little things. It takes more than parks and driveways and canals and green grass and flowers and trees

to make a capital city. I hope I shall not be criticized too severely for what I say, but if you take the parks and trees away from Ottawa you will not have much left. The reply will be made that we cannot do anything without getting money from somewhere, but money is the hardest thing in the world to get under the present arrangement. If the Department of Public Works would spend a little more money upon our buildings it might be to the advantage of this city. There are some nice buildings in Ottawa, such as this one, but some of the dirtiest places in the city are those owned by the government. For instance, I never thought much of the Daly building. I do not know why they have the windows in that building painted green, but there may be some reason for it. For the most part the windows in our public buildings are very dirty, and that is not a good advertisement for government ownership. When some great operatic star comes to Ottawa, what happens? She has to go to a dirty old skating rink.


Gordon Graydon: Who was put in there?


Ernest George Hansell: Jeanette Macdonald.
When a world famous star comes to Ottawa the city turns out as it should, because it is a cultural event, but then they have to go to a skating rink which is called the auditorium.


Gordon Graydon: This is war time and we have to put up with a lot of things.


Ernest George Hansell: I know my hon. friend does not mean that, because this thing has gone on for a good many decades and will continue to go on for many more decades. I see no reason why the capital city should not be beautiful, not only from the point of view of parks, flowers and trees, but from the point of view of architecture and other matters. The main reason why this has not been done is the claim that we cannot do a thing unless it is stamped with the almighty dollar sign. If the city council were asked to do anything they would say that they would have to tax to get the money. It is all a matter of knowing where to get the money. Perhaps some day we shall be in position not only to tell you where to get it, but actually to get it for you.


Mr. MARSHALL:: We are getting it now.


Ernest George Hansell: The hon. member for Camrose says that we are getting it now. That is the peculiar thing. We are getting it now, for purposes that are most necessary I admit, but in the end it will be gone.

C.N.R.-Guarantee of Securities
There will be nothing to show for it. We do not seem to be able to get money to put up substantial buildings which would be of value to the cultural civilization of this country. I am in favour of the bill.


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


[Stage Direction]
Mr. D. C. ABBOTT (Parliamentary Assistant to the Minister of Finance) moved that the house go into committee to consider the following resolution:
That it is expedient to bring in a measure to authorize the Canadian National Railway Company to issue securities not exceeding $6,046,300 in principal amount to provide the moneys necessary to meet capital expenditures made or capital indebtedness incurred during the calendar year 1943; to make provision for the purchase or refunding of capital obligations of the company, or of any company comprised of the Canadian National Railway system, during the said calendar year and for the issue of substituted securities for such purpose; to authorize the governor in council to guarantee the principal, interest and sinking funds of securities issued by the company for the purpose aforesaid; to authorize the making of temporary loans to the said company secured by such securities and not exceeding $6,046,300 in principal amount to enable the said company to meet such expenditures and indebtedness; with authority to give financial aid and assistance to other companies of the said national system.
Motion agreed to and the house went into committee, Mr. Bradette in the chair.
Gordon Graydon: Perhaps the parliamentary assistant who is piloting this resolution through would give some details. We ought to know, for instance, whether this is new debt, what amount is being refunded, and any other details that can be given.


Douglas Charles Abbott: I shall be very glad to do that. The bill to be founded on this resolution is for the purpose of providing authority for the capital expenditures of the railway system and the retirement of miscellaneous maturing obligations, either by way of loan from the dominion or by the issue of securities of the company and guaranteed by the dominion.
The total amount to be provided for this purpose is limited to $6,046,300, divided as follows:
Additions and betterments (less
retirements)	 $12,200,000
Acquisition of securities	 1,294,300
Retirement of maturing capital obligations, including sinking fund and equipment principal payments.... 9,552,000

Less: Available from reserves for depreciation and debt discount amortization	 17,000,000

In the 1942 act it was provided that the railway company, subject to the approval of the governor in council, could retire debt of any of the companies comprised in the railway system in any amount and issue new securities in exchange for such retired obligations. The power conferred by the 1942 act is a continuing one and it is not necessary to reenact it.
That is a general break-down of the $6,046,300 but I shall be glad to give hon. members details of the various items if they so desire.


Gordon Graydon: Is the break-down of
these items lengthy?


Douglas Charles Abbott: It is not very lengthy. I have here, for instance, details of the total expenditure of $12,200,000 for additions and betterments in the different regions in which the railway operates.


Gordon Graydon: If it is a lengthy list perhaps the break-down might be put on Hansard for the convenience of hon. members.


Douglas Charles Abbott: I shall be glad to put it on Hansard, also details of the acquisition of securities, and of the retirement of maturing capital obligations. The details are as follows:
Additions and Betterments
Atlantic Region	 $ 1,369,263
Central Region	 5,050,567
Western Region	 2,548,526
Grand Trunk Western Railroad....	363,279
Central Vermont Railway	 124,909
Montreal Terminals	 363.568
P.E.I. Car Ferry and Terminals,...	35,700
Subsidiary companies	 146,814
General, including additions and
betterments to equipment	 2,715,268

Equipment purchases	 425,968
Equipment retirements	(er.) 943,862



$12,200,000 COMMONS

[Stage Direction]
C.N.R.-Guarantee o/ Securities
Acquisition of Securities
Toronto Terminals Railway Joint with C.P.R.-General additions and betterments-C.N.R.
proportion 50 per cent	 $ 100,000
Northern Alberta Railways
Joint with C.l'.R.-General additions and betterments-C.N.R.
proportion 50 per cent	 1,050,000
Chicago and Western Indiana Railroad
Advances under, agreement of March 1, 1936	 144,300
[Stage Direction]
Retirement of Maturing Capital Obligations, including Sinking Fund and Equipment Principal Payments
Retirement of Maturing Capital Obligations
Indebtedness to state of Michigan re wider Woodward Ave.,
Detroit	 $ 430,000
[Stage Direction]
Sinking Fund Payments
2% C.N.R. Guar. Deb. Stock (1927)	397,702
4% St. John & Quebec Rly. 1st Mortgage Deb. Stock	 6,735
[Stage Direction]
Equipment Principal Payments 5 % C.N. Equipment Trust "K"....	$1,200,000
1.050.000
1.430.000
500.000
650.000
517,173 991,968 1,401,141
124.000
283.000
570.000
[Stage Direction]
Resolution reported, read the second time and' concurred in. Mr. Abbott thereupon moved for leave to introduce Bill No. 135, to authorize the provision of moneys to meet certain capital expenditures and capital indebtedness incurred by the Canadian National Railways System during the calendar year 1943. and to authorize the guarantee by His Majesty of certain securities to be issued by the Canadian National Railway Company.
Motion agreed to and bill read the first time.
I Mr. Abbott.]
On the motion for the second reading of the bill:
Gordon Graydon: I should like to facilitate as much as possible the passage of this bill, but I am compelled to take the position that no bill should ever be passed by this house until the members have had an opportunity of reading it. That I think is a fundamental practice which must never be departed from. I believe that a lengthy discussion of the subject matter of this bill was had in the railway committee, where full details were provided, and that perhaps will save at least some discussion in the committee of the whole. Perhaps the second reading could be taken later to-day. I would have no objection to that unless there are unusual provisions or terms in the bill that require our attention. But I do not think the house or the committee would feel that they were discharging their obligations properly if they attempted to deal with the bill before it had been printed and is before us, even though we desire to facilitate the business of the house.


Ian Alistair Mackenzie: Mr. Speaker, I think the order for second reading should stand, and then perhaps later to-day by unanimous consent we may proceed with it.


Gordon Graydon: I would also point out to the members of the government that while there is a disposition towards the end of a session to facilitate the passage of legislation more perhaps than at other times, we must always bear in mind that this is the country's business and that every item must receive the same care and attention at one stage of the- session as it would at another. I think only with that proviso and on that condition should we facilitate the passage of measures through the house.
Motion stands.



APPOINTMENT OF GEORGE A. TOUCHE AND COMPANY AS AUDITORS

[Stage Direction]
Hon. J. E. MICHAUD (Minister of Transport) moved the second reading of bill No. 77, respecting the appointment of auditors for national railways.
Motion agreed to, bill read1 the second time, and the house went into committee thereon, Mr. Bradette in the chair.
On section 1-Appointment of auditors.
4J%	"	"	"	"L"....24%	"	"	"	"O"....2|%	"	"	"	"P"....24%	"	"	"	"Q"....
3 % Purchase of Equipment 1936
(Dom. Gov.)	
3J% Purchase of Equipment 1940
(Dom. Gov.)	
34% Purchase of Equipment 1941
(Dom. Gov.)	
5 % Central Vermont Equipment
Trust 1929	
5 % Grand Trunk West Equipment
Trust 1929	
24% Grand Trunk West Equipment Trust 1941	

Unemployment Insurance Act
Gordon Graydon: I take it that this is the same bill which has been before the house every year since this legislation was first introduced in 1936?


Joseph Enoil Michaud: Exactly, word for word.


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


[Stage Direction]
Hon. HUMPHREY MITCHELL (Minister of Labour) moved that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure *to amend The Unemployment Insurance Act to facilitate its operation and to extend its provisions to employees in receipt of remuneration up to $2,400 a year, under one or more contracts of service, thereby raising the present ceiling of $2,000 to the amount above mentioned.
Gordon Graydon: Mr. Speaker, before the motion is carried, this brings up, of course, the whole question of the Unemployment Insurance Act. I should like to have a statement from the minister as to the underlying reasons for the introduction of this new extension of the principle of the Unemployment Insurance Act. I do not rise to make any objection to the provisions which the minister envisages in this resolution, but I would ask if there is anything in the bill in addition to the generalities set forth in the motion which is before the house. That is rather important.


Mr. MITCHELL:: I could make a lengthy statement if my hon. friend desired, giving the whole background of the Unemployment Insurance Act, but this particular bill contains only one fundamental change in the operation of the act, namely, to increase from $2,000 to $2,400 per annum the earnings of those persons who may come within its orbit. I may say that this increase was recommended by the advisory committee on unemployment insurance composed of employers and employees, after public hearings had been held. That is all that is proposed, that one fundamental change in the application of the act, to increase the amount from $2,000 tc $2,400.


Gordon Graydon: The resolution states that the measure to be introduced is intended "to facilitate its operation." That was the point I had in mind. If the proposal is only a
matter of raising the present ceiling from $2,000 to $2,400, it may not be necessary to have any lengthy discussion on it.


Humphrey Mitchell: That is the object.


Gordon Graydon: Is there anything else in the bill?


Mr. MARTIN:: That is the main purpose, and it was agreed upon after hearings.


Gordon Graydon: May I ask under what auspices the hearings were held?


Humphrey Mitchell: I will answer that in committee. The Speaker is in the chair.
Motion agreed to and the house went into committee, Mr. Bradette in the chair.


Douglas King Hazen: When did these hearings take place of the advisory committee on unemployment insurance, as a result of which the committee made the recommendation to which the minister has referred? At the hearings did any employees appear who objected to this increase?: I feel convinced that there are a great many people in the country earning $2,400 a year who will object most strenuously to coming under the act. Many are employed by companies who have insurance or pension schemes and are making contributions to those schemes, and it is going to be hard on them. If consulted they must have strenuously objected to being brought within the act.


Humphrey Mitchell: I have no knowledge of any representations made with reference to the increase from $2,000 to $2,400, but we have received representations from certain labour organizations urging that it be increased to $3,000. The figure $2,400 was decided upon after representations had been made by employers and employees who appeared before the committee. If I might express a personal opinion, I think it should be $3,000. In view of increased earnings in some sections of the country, the more persons we bring within the orbit of the legislation the more constructive the act will be, and possibly it will be helpful in the post-war period. After these extended hearings there was an agreement between the parties, employers and employees, through their representatives and $2,400 was agreed upon and recommended.


Douglas King Hazen: When did these hearings take place, and what labour organizations asked that the increase be made?


Humphrey Mitchell: Perhaps my best course would be to read the report in which a list of
Unemployment Insurance Act

the organizations is given. After -that, if there is anything I can do to clarify matters I shall be glad to answer questions. The report reads:
To His Excellency
The Governor General in Council:
By order in council P.C. 10156 of January 7, 1942, the unemployment insurance advisory committee was instructed under the provisions of section 86 of the Unemployment Insurance Act, 1940, "to investigate and report upon the provision of unemployment insurance for all or part of the employments excepted from the operation of part II of the act by the said item (n) of part II of the first schedule by extending thereto the provisions of part II of the act."
Prior to this instruction, the advisory committee had discussed with .the commission the problems of administration out of which the reference arose. The committee met in Ottawa to consider this reference on February 18 and 19 and March 16 and 17. In order that interested parties might have an opportunity to present their views, notices, in English and French, were printed in the Canada Gazette of January 31, 1942, advising such organizations or persons that the advisory committee would receive written representations and would hear those who desired to appear on February 18. The notice was drawn to the attention of all the larger organizations representing employers and employees and they were asked to draw it to the attention of the members. Those who made representations were subsequently advised that the advisory committee would continue its deliberations on March 16 and 17 and further written and oral representations were received. In all. representations were made by the following organizations:
Trades and Labour Congress of Canada, Canadian Congress of Labour,
Confederation of Catholic Workers of Canada, Brotherhood of Locomotive Engineers,
Order of Railway Conductors,
Brotherhood of Locomotive Firemen and Enginemen,
Brotherhood of Railway Trainmen, Brotherhood of Maintenance-of-Way Employees,
Brotherhood of Railway and Steamship Clerks, Canadian Manufacturers Association,
Canadian Chamber of Commerce,
Canadian Bankers' Association,
Canadian Life Insurance Officers' Association, Dominion Mortgage and Loan Association, Retail Merchants Association of Canada, Montreal Board of Trade,
Toronto Board of Trade,
Calgary Board of Trade,
Hamilton Chamber of Commerce,
Windsor Chamber of Commerce.
I think that is a fair cross-section of the organized employers and employees of the dominion.


Mr. JACKMAN:: Will the minister specify which of these organizations asked for an extension to $2,400 and which were against it?


Humphrey Mitchell: on periods of time exceeding one week and to raise the maximum earnings limitation where it would still apply from $2,000 to $2,400 a year.
The committee is of the opinion that such action will remove most of the serious administrative difficulties, and will bring and retain under unemployment insurance substantial groups of workers without creating important anomalies by reason of the employments excepted by other paragraphs of part II of the first schedule.
In the proposed amendment of paragraph (n) the words "under one or more contracts of service" are inserted at the request of the commission whose assurance that they will clarify the clause and simplify administration is accepted by the committee.
The^ committee proposes to bring to the attention of the unemployment insurance commission the representations it has received concerning other excepted employments.
Respectfully submitted on behalf of the advisory committee,
W. C. Mackintosh,
Chairman.


Mr. HATFIELD:: How much has been
paid out, and how much has been collected to date?


Humphrey Mitchell: Mr. Chairman, I have
been called to attend a special meeting of cabinet. I was wondering if I might be excused, and this matter continued at eight o'clock?


Gordon Graydon: I realize the urgency of
the matter about which the hon. member has spoken. One of the [DOT] cabinet ministers was good enough to speak to me about it. I would suggest that the minister might come on after the department succeeding him is completed.
I think we ought to avoid breaking up our discussions any more than is absolutely necessary. Perhaps the Minister of Mines and Resources would go on until that department is finished.


Thomas Alexander Crerar: Perhaps the Minister of
Labour might be excused, and his parliament tary assistant might take over in the absence of the minister. If that understanding is agreeable, we shall proceed in that fashion.
Mr. GRAY-DON:	I have no objection to
that.


Harry Rutherford Jackman: What is the ceiling in
Great Brtiain and in other British dominions, particularly in Australia and New Zealand, where they have unemployment insurance measures?


Paul Joseph James Martin: I am afraid I have not any information for the hon. member respecting the situation in Australia. However, in the United Kingdom there is no ceiling for men who might be regarded as being engaged in laborious endeavour.


Harry Rutherford Jackman: The reason I askedand I should hope the parliamentary assistant might give us some information later-is that when the committee was considering the original bill in 1940 requests came from several miners' organizations that the limit be raised from $2,000 to $2,500, in order that they might come under the terms and, as they saw it, the benefits of the proposed enactment. That was, for good and sufficient reasons, turned down by the committee; and I believe the report of the committee at that time was unanimous. I am bearing in mind, however, that there has been some advance in wage rates since that time.
However, if I recall correctly-and I hope the parliamentary assistant will check me on this matter, because the incident is now some three or four years old-the reason why groups earning more than $2,000 were not included in the original unemployment insurance scheme was that the labour exchanges, which were an integral and important part of the whole enactment, did not feel that they could provide jobs for the type of men who would earn over $2,000 a year. It was considered to be more in the nature of a fairly well-paid job, rather than a matter of mass employment which could be dealt with suitably by the labour exchange. There must be some change in that situation now, if this is being applied.
In a constituency like mine I have a great many salaried people who would receive somewhere between $2,000 and $2,500. My understanding is that they will now come under the proposed amendment. Would the parliamentary assistant state how much a worker earning $2,500 will pay during the year? These are people of a class who are already making a real sacrifice in this time of w'ar. This salaried class has not been receiving the wage increases which wage-earners, such as those in my own riding, have been receiving in order to cope with the increased cost of living, which to some extent is off-set by the cost of living bonus. Then, the wage-earners have benefited as a result of the longer hours they have been permitted to work, and the considerably increased rates of pay allowed.


Paul Joseph James Martin: It would cost about S1S.72 a year.


Harry Rutherford Jackman: It is not as much as I thought it would be. Perhaps the hon. member will confirm that figure, if he has any doubt about it.


Paul Joseph James Martin: I am advised by our
officers that it is fifty-two times thirty-six cents. I will send the hon. member the table of payments.

Unemployment Insurance Act


Harry Rutherford Jackman: If that is the total
amount I shall not labour the point unduly. Nevertheless a great many people will now come under the limitation, when it is increased to $2,500. These people's jobs are not only relatively secure, I believe they are very secure. They receive lower incomes than they otherwise would, on account of the stability of those jobs, and, on account of the nature of their work, they are not likely to receive any benefits under the unemployment insurance measure. That is why I asked how many of the associations who delivered briefs at the time of the hearing were in favour of the proposal, and how many were against; and I should like to know the names of those associations.
I should think, for instance, there would have been a recommendation from the bankers' association. A manager in a small branch may not receive a large salary, but the bank provides well for his retirement. That man will now have an extra impost of S1S.72 to pay. That is another bit out of his income, at a time when he is already scraping to make ends meet.
Then, I would ask the parliamentary assistant to bear in mind the fact that the person who prior to the war received $2,500 was relatively free from income tax. However, the income tax now reaches down to a much lower level, and the rate has risen so quickly that people are paying very high income taxes, with the result that their expendable income has been greatly reduced.
My understanding of the unemployment insurance legislation is that it is not only insurance for those who may lose their jobs. In it are included a great many classes of workers who have no fear or prospect of losing their jobs, and it is virtually a donation by every job holder in order to provide some insurance for those who may lose their jobs. The people in the higher brackets, above $2,500, are supposed to make their contribution to the steady work of their fellow men, or to afford them something when they are out of employment, through the higher scale of income tax they pay.


Mr. MacINNIS:: I do not think much needs to be said about this amendment. It is a desirable amendment and should have the unanimous support of the committee. When the bill was before the special committee in 1940 numerous requests were made that the maximum should be raised, some hon. members suggesting a limit of $3,000 or $4,000. My memory is that the committee was favourable to increasing the maximum, but the government was opposed because the schedules had been worked out and the
actuary claimed that it would upset the actuarial basis of the bill. I never thought that that was correct because the inclusion of these higher paid employees under the act would have benefited from an actuarial point of view. As the hon. member for Rosedale (Mr. Jackman) mentions, the purpose of the Unemployment Insurance Act is to spread the hazards of unemployment over all workers, those who have fairly permanent employment and those who have only seasonal or part-time employment. If we were to eliminate from the act those who are in the higher wage brackets, then we are making a case for excluding from the act those who are in sheltered employment. If the insurance scheme is to apply only to those who are bound to be out of work for part of the year, it would not be possible to make the rates high enough to carry the insurance on an actuarial basis. I insist that all workers should come under the act, that there should be no exception or no ceiling as far as annual wages are concerned. In the meantime I think it would be wise to accept this amendment. If the department or the government feel that the maximum should be increased, I think it will meet the wishes of the labour movement in general. I am in favour of the amendment.


Mr. GERSHAW:: This resolution proposes an amendment to the Unemployment Insurance Act. I regret that the act cannot be further amended at this time because there is a great need in this country for insurance against sickness and invalidity. If a worker is injured and comes under the benefit of a workmen's compensation act, he has the chance of having an income, but if he is disabled on account of sickness, his income generally stops at once. Plans are under way for a comprehensive health insurance scheme and for other forms of social security, but this would seem to be the most suitable place to attach an amendment which would meet the hazards of sickness and invalidity in the homes of the workers.


Howard Charles Green: When the Unemployment Insurance Act was passed three years ago there was quite a lengthy debate about including loggers in British Columbia. At that time the government could not see fit to include them, but promised that an investigation would be made by the advisory committee which was to be set up. Could the parliamentary assistant tell us whether a report has been received and what is going to be done by the government with regard to the logging industry of British Columbia?
Unemployment Insurance Act


Paul Joseph James Martin: An interim report-it is more than an interim report, but that is the best way to describe it-has been received. Just as soon as it becomes administratively possible they will be included. Power is being sought under the proposed amendment by the unemployment insurance commission and the governor in council to include them at as early a date as possible.


Howard Charles Green: When is it expected that it will be possible to include them?


Paul Joseph James Martin: I would hope well before the next session of parliament.


Harry Rutherford Jackman: One of my colleagues asked how much had been paid into the insurance fund and how much had been paid out.


Paul Joseph James Martin: The payments in are as
follows:
Employer and employee contributions	$
Government contributions .. Interest	
93,871,960 55 18,774,392 11 1,861,625 09

Benefit payments	 743,810 68
Balance	$1.13,/64,167 07
The amount invested in government bonds as of May 15, 1943, is $107,376,737.57.


Grote Stirling: I understand the rate paid by the employee is thirty-six cents a week when he is earning $2,000.


Paul Joseph James Martin: That is the maximum, but it could be lower.


Grote Stirling: What would the employer's contribution be?


Paul Joseph James Martin: The employer's contribution would be twenty-seven cents maximum. The rates vary from eighteen cents minimum, in the case of the employer, to nine cents for the employed person, depending upon the amount of salary received. If my hon. friend cares to look it up, he will find this set out in the second schedule of the old act or at page ten of the present amended bill.


Harry Rutherford Jackman: The parliamentary assistant has not made it as clear as I should like to have it why the maximum was raised to $2,400 and not to $3,000, especially in view of the fact that the original request made when the bill was first discussed three years ago that the maximum be $2,500 was turned down. One of the chief reasons for turning it down was that the labour exchanges did not find themselves able to provide jobs for people in that range, because the jobs were too individualized

once a man gets above $2,000. What is the present philosophy of the Department of Labour in that regard? If they have changed their ideas so far as providing jobs is concerned, why not raise the ceiling from $2,400 to $3,000 or some other figure.


Paul Joseph James Martin: The hon. member, I take it, was not in the house when the minister made his statement on that very point. He stated that, expressing his own wish, he would certainly agree to the $3,000 figure. The $2,400 figure was arrived at by the unemployment insurance advisory committee which held hearings at which employer and employee groups were represented, and the figure of $2,400 was the figure recommended to the minister on the basis of that inquiry. That is the reason why the $2,400 figure was accepted. It was the result of a compromise between employer and employee groups. So far as the minister himself was concerned, he said that he would have gladly gone to the $3,000 figure and expressed the hope that as many classes as possible could be brought within the act.


Harry Rutherford Jackman: I endeavoured to point out that the ceiling was fixed at $2,000 before, because the labour exchanges did not feel themselves adequate to providing jobs for workers above that figure because their jobs were too specialized. But you are now raising it to $2,400, and I want to know what the general principle is and whether the committee in charge of this matter feel that jobs could be provided for men in the $2,400 range; and if they can go that far, why not include men in the $3,000 range? I am interested in knowing the general principle behind the act, not what the committee's final decision was, but what their reasoning was for increasing the present ceiling to $2,400. Before the parliamentary assistant is through, I hope that he will let us know which of these associations were for and which against the ceiling of $2,400.


Paul Joseph James Martin: Replying to the last question, I have not that information before me. I would have to get it from the minutes of the committee, and that I shall endeavour to do. With regard to the other question, whether it is thought that jobs could be obtained, the answer is, yes.


Harry Rutherford Jackman: Through the labour
exchanges?


Paul Joseph James Martin: Yes.


Mr. ISNOR:: Pursuing further the question raised by the hon. member for Rosedale with respect to the representations made by various

War Appropriation-Transport
bodies appearing before the advisory committee I have in mind the representations that were made by the Canadian Manufacturers' Association. If I remember correctly they were against unemployment insurance in the first instance, but finally they came in. line with the majority and favoured its introduction, although they felt that the time was not opportune. That was in 1940. But when they made representations before this committee later on they did definitely take the stand that the ceiling should not exceed $2,200. Is there any record of their representations on that occasion? I should also like to know what were the representations made by the Retail Merchants' Association of Canada, along what lines they argued as to the amount that should be fixed.
I have always been in favour of unemployment insurance and have advocated it from the very first, but there has been considerable criticism of bringing under it clerks who are permanently employed. They feel that there is nothing they can look forward to in unemployment insurance. That feeling is widespread, and in view of that I should like to know what stand was taken by the Retail Merchants' Association, of Canada when they made their representations.


Paul Joseph James Martin: The Retail merchants' association did not object.


Gordon Benjamin Isnor: But did they make any repre-esntations one way or the other?


Paul Joseph James Martin: I have to answer my hon. friend as I answered the hon. member for Rosedale. I have not the minutes of the committee before me, but I hope later to be able to give the hon. member that information. The Retail merchants' association did not object to the final conclusion.


Douglas King Hazen: I understand the parliamentary assistant to say that over $93,000,000 had been contributed by employers and employees. Could he tell us how much has been paid in by employers and how much by employees? Or did he give those figures? If he did, I did not get them.


Paul Joseph James Martin: I have not the exact figures before me, but it breaks pretty much fifty-fifty. I will try to have the exact figures later for my hon. friend.
Resolution reported, read the second time and concurred in. Mr. Martin thereupon moved leave to introduce Bill No. 136, to amend the Unemployment Insurance Act, 1940.
Motion agreed to and bill read the first time.



WAR APPROPRIATION BILL


[Stage Direction]
The house resumed from Thursday, July 15, consideration in committee of a resolution to grant to his majesty certain sums of money for the carrying out of measures consequent upon the existence of a state of war-Mr. Usley-Mr. Bradette in the chair.

[Stage Direction]
Transport services-
1. Departmental administration, $26,960.
Grote Stirling: Does the minister propose on this item to make a statement with regard to wmr expenditures?


Joseph Enoil Michaud: Mr. Chairman, there is no elaborate statement to be made about war expenditures of the Department of Transport. These are really incidental expenses in connection with the ordinary services, but additional services are being provided. They are merely increases in some of the branches: for example, transport controller, merchant seamen, canals service, marine service, and railway and steamship service, and a special item for railway equipment; providing for loans to the Canadian National Railways for two purposes, namely increasing the equipment, and the development of the Vermilion oil field.
I believe these estimates would be disposed of more quickly if on each item the desired information was requested, and I would attempt to give it.


[Stage Direction]
Item agreed to.
Director of merchant seamen-
Headquarters administration, $73,190.
Grote Stirling: Would the minister give the committee some account of the progress being made by the director of merchant seamen particularly with regard to the schools of seamen which have been set up, and how they are prospering?


Joseph Enoil Michaud: As hon. members know, this service is required in order to furnish the supply of merchant seamen required for the boats which have to be manned from our several Canadian ports. Also the pool is operated to accommodate British as well as foreign seamen who arrive on our shores on either British or foreign ships. This is being done through a working arrangement with Britain, and the expenses of the upkeep and
War Appropriation-Transport

paj^ment of their basic wages while the seamen are here in the pool are reimbursed by Britain.
We have our pools in Halifax, Saint John, Montreal, and Vancouver, and we are establishing one at Sydney, a subsidiary pool to Halifax, in order to accommodate the merchant ships which come to that port. In each place we have what we think are, what we are trying to make, suitable quarters to take care of these seamen, who, when they arrive at our shores, never know, owing to the exigencies of war, when they will be called upon to go back. They cannot be expected to live on the ships, while they are waiting for the return trip. They receive their basic wage, and they are boarded and lodged in the pool until they receive employment. The great difficulty is to get trained officers in Canada. Heretofore we had a very small merchant navy. For the obvious reason that there was no great demand for officers, few of our boys trained. With the immediately increased demand we had to resort to Britain for our requirements, and I am happy to state that Britain has provided so far, and has given assurance that we shall be provided at least until September, sufficient officers to man the ships, and the crews will be Canadian. In view of the large requirements we have taken steps to provide for the training of some engineers and navigators. We have a school at Prescott, Ontario, and another school at St. Margaret's, Nova Scotia. Both schools have done exceedingly well and have provided quite a number of officers, who have been absorbed, as fast as they got their certificates, into our merchant navy. I may here give some details which might be of interest to the committee.
Each ship requires either forty-three or forty-seven officers and men. We get the officers from Britain and certified engineers and firemen from our schools. We expect that, if things go well, we shall have seventy-five ships manned by August-and not only manned, but sailing the high seas. We provide the ordinary seamen from Canada, and the officers, masters and other special officers, from Britain. The supply, as I have stated, has been practically guaranteed up to September next.


Grote Stirling: This is from the pools?


Joseph Enoil Michaud: No, the officers are not taken from the pools.


Grote Stirling: No, not the officers, but the men.


Joseph Enoil Michaud: All the men are taken from the pools.


Gordon Graydon: When the minister moved into his estimates on the Department of Transport war appropriations, I was out for a moment when departmental administration, which is the item upon which I should really be speaking, was passed. I had previously spoken to the minister and told him that I had a remark or so to make with respect to the general transportation situation, and if I may be permitted to give it now, I should like to do so.
Much has been said in the house from time to time since the war commenced about the major contribution being made on many sectors of our civilian front. I desire briefly to speak of and to pay tribute to the yeoman service being rendered by these scores of thousands of our Canadian people engaged in the railway transportation services of Canada. In my young days I had the honour of being an employee of one of the Canadian railway systems. I know something of the esprit de corps and the tradition of the railway transportation services, and I felt that I could not let this opportunity pass without saying a word on behalf of a great and important section of our people who on the civilian front are rendering a magnificent service under most difficult and trying conditions.
We take these services, I fear, too much for granted, largely because they operate without seeking to draw the attention of the public in any comprehensive way to the work which they are quietly and constantly performing.
Outside of agriculture, railway transportation is perhaps Canada's biggest war industry, and has shouldered a burden of war activity the extent of which few people in this dominion seem to realize. In 1939, the year war was declared, our Canadian railways carried 17,000,000 passengers, while in 1942 the number had increased to 42,000,000. Strained as the facilities were to meet these constantly increasing demands, with a man-power situation which left much to be desired, the employees of our railways may take much pride in the fact that, out of the 42,000,000 passengers carried last year, only 380 lives were lost from one end of Canada to the other in railway accidents. If we bear in mind the swollen conditions of passenger traffic, and the added responsibility of moving special troop trains, the loss of life is amazingly small, constituting less than one person in every 100,000 persons carried. The efficient care and constant concern of the railwaymen for the safety of their passengers has been so maintained in these war years that the ratio of death through accident is actually much lower than it was in the leisurely years of peace.

War Appropriation-Transport
In 1939, our railways carried 69 million tons of revenue freight; in 1942, this was increased to 107 million tons.
What more could be asked of, and what more could be given by these loyal employees of both railroads? They deserve the undying gratitude of a thankful Canadian people who have seen them measure up on the civilian front in the same way as their brother-employees are doing on the sea, on the land, and in the air in our armed forces.
Among Canadian National employees who have joined up, there are in the navy sufficient to man nine destroyers; enlistments in the active army are sufficient to form six infantry battalions; and Canadian National men in the air force would establish eleven air squadrons. Add to this, 1,000 officers and men of the Canadian National Steamships on active service on all the seas.
As of November 30 last, which is the last record I could obtain, and perhaps these numbers must be increased because of lapse of time, Canadian Pacific Railway employees enrolled in the armed forces from the eastern and western lines, and from the overseas office included: 4,263, army; 1,039, navy; 1,622, air force and 686 others, making a grand total of 7,510. On active service from Canadian Pacific Steamships, express and air lines, there are another 6,087.
On the war front, and on the home front, Canadian men of the rails are giving their best, are giving their all, in the cause for which this nation fights so that it may be brought to a successful conclusion.
Hats off! to the railway employees of Canada. No tribute which this House of Commons or the people of Canada cam pay them will do justice to the contribution which they are so quietly but so effectively making at the present time.


Grote Stirling: I had hoped that the
minister, in describing what had been accomplished by the director of merchant seamen, would tell the committee something with regard to the school recently set up to which youngsters can go and be trained.


Joseph Enoil Michaud: I was about to come to
that. I was going to describe the way we are trying to recruit crews for our Canadian-built ships. We have two training schools, one marine engineering instructional school, opened on January 1, 1942, at Kingston, but transferred on April 1 of that year to Prescott, Ontario, in a government-owned building. We have been training boys in marine engineering, the capacity being eighty trainees each six weeks, although the average has
been about sixty. I am glad to be able to say that these boys have all been absorbed and have given excellent service, and had it not been for these facilities we would not have been able to get the engineers required. The age limit is from eighteen to thirty.


Grote Stirling: What length is that
course of training?
' Mr. MICHAUD:	Six weeks. While they
are in that school they are lodged and fed. After they graduate from that school, if we have not immediate employment for them they are transferred to the manning pool waiting to be called for service. Besides this school at Prescott, we have one at St. Margaret bay, at Hubbards, Nova Scotia. It was opened in July, 1942. The capacity is 115 to 140 trainees over a thirteen-week period. The age for admission to the school is from seventeen to twenty-two. So far we have had an average of about 125 for each course, and these graduates have volunteered for service on completing their course. These are the two schools that are operated under the director of merchant seamen for the purpose of giving initial training to boys and men for the Canadian navy.


Grote Stirling: With regard to the second school the minister mentioned, does he mean that 125 are turned out every thirteen weeks?


Joseph Enoil Michaud: Yes.


Angus MacInnis: I wish to draw to the attention of the minister complaints that were forwarded to me by certain persons on behalf of the crew of the ss. Lady Laurier. The minister will recall that members of the crew of this ship some time ago staged a walk-out on account of the conditions prevailing on the ship.
I have a statement signed by two members of the crew which I should like to read to the committee. This indicates conditions which in my opinion are really disgraceful and which should not be tolerated if we are to have any hope of building up a merchant marine in this country. Though I did not go into the question of working conditions when we were dealing with questions of transport on the estimates of the Department of Munitions and Supply, I may tell the committee that practically the same conditions prevail on the Pacific coast. This statement reads:
To whom it may concern:
We, the following members of the crew of the ss. Lady Laurier, operated by the Department of Transport, do hereby swear the following to be true and correct.
After we had protested on several occasions against the wages and conditions on the above

War Appropriation-Transport
mentioned vessel, we gave fourteen days' notice of our intention of leaving the job, unless the said wages and conditions were improved. At the end of that time we signed off the articles, leaving the ship.
Having left the ship, several of us attempted to obtain employment on other ships through the selective service. We were told by the local agent of the selective service that we must either return to the Lady Laurier or go into the army.
Although only seven days' notice were required to leave a job and we had given fourteen days' notice, we were refused good discharges, were reported "DR" as to character.
I do not know what those two letters mean in seafaring parlance.
This discharge yvas issued without any shipping master being present, although the Canada Shipping Act states very clearly that it is an offence to give any such bad discharge unless entered in the official log of the ship and issued in the presence of a shipping master.
As I have already said, this statement is signed by two members of the crew. I should be glad if the minister would make a statement in regard to these charges.


Joseph Enoil Michaud: I have never seen the declaration which has been read by the hon. member. If the members of the crew of S.S. Lady Laurier presented their case to their superior officers of the naval service of the Department of Transport, their grievance never came to my attention until a copy of a letter written by an officer of the Canadian Seamen's Union in Halifax to a member of this house was shown to me, in which letter this gentleman, acting in behalf of allegedly dissatisfied seamen, brought their case to the attention of the hon. member in question. When the matter was brought to my notice a few days ago I made some inquiry and found that on June 3 a certain number of the crew of the S.S. Lady Laurier informed the master that they would not proceed on the next trip unless they were granted a bonus of $44.50, which bonus should not be subject to the income tax. On the return of the Lady Laurier to port, these men were informed that their demand for an increased war bonus could not be met, and then on June 11 fifteen left the ship. They received discharge certificates marked "DR", which in the naval vernacular means " declined to report." The men were directed back to the ship by national selective service, a few days later, and apparently have resumed their work, and I have not heard from them except through the hon. member for Cape Breton South and this afternoon through the hon. member for Vancouver East. It is possible that these dissatisfied members of the crew of the Lady Laurier brought their grievance to the attention 
of the master, but the facts which I have related were brought to my notice only a few days ago.
The allegations set out in their sworn declaration are substantially what has been reported to me by the officer of the marine department. Their wages could not be increased on demand, because they are subject to the war labour board and also to the schedule of pay received by all seamen on government boats. I know that some of these ordinary seamen feel that they should receive higher wages, and in some respects I am inclined to agree with them. So much so that when this matter was brought to my attention I caused some action to be taken with a view to increasing some of their allowances as much as was permissible within the rules. If this cannot be done to the extent I feel it should be done, then the matter will be brought to the attention of the war labour board and a request will be made for the increase which I believe they should be given.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.


Angus MacInnis: I should like to continue with respect to the matter I was talking about when the committee rose at six o'clock. I believe the minister said that after making some investigations in regard to the walk-off by the employees or sailors on the Lady Laurier he was satisfied there was some ground for complaint. I hope the minister, having come to that conclusion, will see that the abuses are rectified. Indeed, my opinion is, and I think it will be substantiated by any comparison of wage rates on Canadian and United States ships, that conditions and wages on Canadian ships are no credit either to the Canadian government or the people of Canada.
I will just give the minister and the committee a few figures with respect to wages paid on the ss. Lady Laurier. A fireman receives $80 a month. Added to that is board amounting to $19.50. Then, there is a bonus of $13.60, making a total of $113.10. But by the time the fireman is paid his wage, with the various taxes and deductions amounting to $43.80 he has only $69.30 left for the month. I think the minister will agree with me that that is not sufficient for a working man to live on.

War Appropriation

Transport
In the month of June, the month in which the dispute on the Lady Laurier took place, the men had worked twenty-seven days on the ship. All in all, able seamen on the ship averaged fifteen hours a day. That is, for the twenty-seven days in June they worked 374 hours. For that they received a pay cheque amounting to $53 and a few cents. Is it any wonder that the dispute developed, and that the men gave notice to quit? May I point out that the men did not strike. They gave fourteen days' notice, although only seven days is required by law. Yet, when they went to apply for other jobs the selective service would not place them. In other words, one department of government pays such miserable wages people cannot live on them, and another department of government, after the employees have carried out all the instructions under the law, refuses them the protection of accepting other work. They were told, "You go back on the job, or go into the army." I say to the minister that that is not good enough. It is no.t the sort of thing for which the young men of our country are spilling their blood in Sicily to-day.
Would the minister inform the committee as to the amount of the war risk bonus paid on the Lady Laurier?


Joseph Enoil Michaud: Does the hon. member mean the war risk bonus?


Angus MacInnis: Yes.


Joseph Enoil Michaud: The war risk bonus is
twenty-five per cent of the basic wage. I am afraid the information the hon. member has just presented to the committee does not conform with the information I have just received regarding the same situation, and having to do with the men on the steamship Lady Laurier who were dissatisfied. My information is that these men did not work 374 hours, as was mentioned by the hon. member. I am told that in May they worked 266 hours and in June, 242 hours, a daily average of slightly over eight hours. This works out at approximately forty-two cents an hour for May and forty-five cents an hour for June, for the actual time worked during those two months.
With respect to the complaint by a fireman regarding a large deduction from his pay cheque in June, I would say that in compiling his wages, or the different figures which make up his wage cheque, he did not take into account the deduction of $19.50 for his board, which was not paid to him but was paid to the steward of the boat, and also his basic wage rate plus war risk bonus and cost of living bonus. Also there was a retirement fund deduction of S4. It is not fair to claim that that was taken off his cheque. It was simply held back, to be paid to him later on. I am informed that the actual deductions amounted to $24.30. Of that sum, $20.30 was for income tax, and $4 for retirement fund. So that instead of a deduction of $43.80, the actual deduction from the pay cheque was $24.30.


Angus MacInnis: The $19.50 does not matter so much, because it is counted in his wage in one place, and counted as a deduction in the other. So that the man will have a wage of $S0 and a bonus of $13.60, making a total of $93.60. The income tax was $20.30, which left him $73.30. What is the war risk bonus on the Pacific coast?


Joseph Enoil Michaud: The war risk bonus for Canadian government merchant ships is $44.15. The Lady Laurier is not a merchant ship; she is a buoy-lifting ship which is doing some work on the coast and in the gulf of St. Lawrence. The figures for firemen, both single and married, are as follows:
	Single	Married
Basic wage 	
$80 00	$80 00Cost of living bonus	
13 60	18 42Board allowance 	
20 15	20 15War risk bonus	
10 64 	
$124 39	10 64 	
$129 21Deductions:	Income tax 	
$24 10	$13 40Retirement fund 	
4 00	4 00Board allowance 	
20 15	20 15
48 25 -	
37 55$ 76 14	$ 91 66
War Appropriation-Transport


Angus MacInnis: Has the war risk bonus on the Lady Laurier been increased since this complaint was made?


Joseph Enoil Michaud: Negotiations are under way for increasing the war risk bonus, but I do not think the order increasing it has actually been made.
Mr. MacINiSlIS: Some weeks ago I directed attention to the difference in wages paid by the Park Steamship company

that is on government boats-and privately-owned ships on the Pacific coast. I should like to make another comparison. Sailors on the Pacific coast operating Canadian ships continually meet sailors from United States ships and of course working conditions and wages are compared. I should like to put on the record the wages paid by privately-owned Canadian ships on the Pacific coast, and those paid by United States ships, and I would ask hon. members to note also that the rates paid by the Park Steamship company are considerably less. These are for privately-owned ships, not government-owned. The wages are:
Canadian United States
Quartermaster	
$80	00	$105	00Winchman	
80	00	110	00Able seaman	
75	00	100	00Ordinary seaman ...	55	00	82	50
The wages paid by the Park Steamship company are less than those paid by privately-owned ships and are little better than one-half what are paid on United States ships. When you come to the officers the situation is as bad, if not worse. The salary paid to the master of a United States ship is not given, but the master of a Canadian ship receives $250. The other officers are paid the following:
Canadian United States
First mate	
$165	00	$316	25Second mate	
135	00	253	00Third mate	
110	00	224	25
The wages paid to below-deck officers bear the same relation to each other. I suggest to the minister that he should take some steps at least to bring the wages paid by the Park Steamship company into line with those paid on other Canadian vessels.


Alan Webster Neill: Since this item has to do with merchant seamen, I presume I am in order to speak on it, although I did not know that the Minister of Transport had anything to do with this subject. It appears that on December 19, 1942, order in council P.C. 11397 was passed. Perhaps I might invite the attention of the Minister of Justice (Mr. St. Laurent) to this, because it seems to be under

his jurisdiction. Apparently there had been an order passed some eighteen months before that, known as the merchant seamen's order. The purpose of it was to expedite the departure of ships, but apparently it was not working very well for it was amended five times. Then, in December last they wiped out the whole thing and started afresh. My opinion is that they have not made things much better.
The order works something like this. The Minister of Justice may nominate two men, and two men only, to compose a committee of investigation which may inquire into the conduct of any seaman, picked up when and where you like. This investigation is preliminary to an inquiry which may be held later on. One man represents the naval services and the other the Royal Canadian Mounted Police, but it really means that one man is the committee, because subsection 3 of section 3 of the order states that the naval service man shall be the chairman and his decision shall prevail. In other words, he is the whole committee. As I say, this committee has authority to investigate the conduct of any seaman wherever he may be.
The evidence may be taken by way of affidavit. Any lawyer will know how unfair that type of proceeding is to the accused, because the man who is giving the evidence by affidavit cannot be cross-examined, and there is no chance to have him modify the affidavit which he may have made weeks or months before. The case might arise when some captain or mate is busy loading a ship and is anxious to get away. A seaman comes along, perhaps after having a drink or two, and gives the officer some impudence. Next day the officer goes and makes an affidavit, but the case does not come up for a week or a month. By this time the officer may be at sea, and the affidavit cannot be modified as perhaps he would like to do. As I have said, there is no opportunity to cross-examine. It will also be remembered by those of us who are familiar with the naval and marine services that there is a vast difference in discipline between the two. Is it not Shakespeare who says:
That in the captain's but a choleric word,
Which in the soldier is flat blasphemy.
In any of these shipping towns you can hear language among seamen which would be very different from what would be allowed in the naval service. Their relationships are much more easy in the merchant service.
This investigation is to determine whether a prima facie case has been made out against the man, but nine times out of ten the man

War Appropriation-Transport
is not there and knows nothing about it, and the investigation is held in his absence. This investigation is held on the strength of the affidavit of a man who made it weeks or months before and has probably gone away and forgotten all about it, or, if he thinks about it, wishes he had not made it.
I particularly call attention to the circumstances under which the committee can order a man arrested. He is not summonsed; he is arrested and put in gaol. Under the various subsections of section 6 of the order this one-man committee can issue an order to arrest a seaman if this one-man committee is satisfied-that is the criterion-that he is "likely to be" responsible for causing any delay in the departure of a ship or is "likely to refuse" to sail on a ship or is "likely to refuse" to perform his duties on a ship or is "likely to induce" other seamen to interfere or is "likely to carry on" any subversive activities. The committee does not have to be satisfied that the man has done any of these things-not for one minute. It has only to be satisfied in -the man's absence that he is "likely" to do them. I suppose the committee looks at a man's photograph and says: "This is a bad man; we do not like his looks; we will send him to gaol because he is 'likely' to do anything." We are all "likely" to do anything, and if all of us here had to go to gaol because of things we are "likely" to do, it would be just too bad.
A sailor can be arrested without warning simply because this one-man board thinks he "is likely to" do something. Is it anything approximating British justice to arrest a man because somebody thinks he "is likely to" do something wrong?
Having ordered the man's arrest, the committee finds a prima facie case against him and submits it to the board of inquiry. The board of inquiry is appointed in the same way -no; it is even worse because the procedure there is this. The board of inquiry supposedly consists of a representative from each of three different departments, but it is provided that two will suffice and that where a quorum consists of two only, the decision of the chairman shall prevail. Another one-man court, and it all boils dowm to an officer in the naval service.
It is also provided that the original committee, or one member of it, shall be a competent witness before the board of inquiry. There is another case of making the thing a hole-in-the-corner affair. There again the board is empowered to convict this man just because he is likely to do something or to refuse to do something. How in the name of providence can you know what a man is likely to do until
you tell him to do it? You take a look at him, I suppose, and say: "He is bad medicine; we will put him in gaol for three months." They can give him three months in gaol, but before the end of the three months he is brought forward again, and after taking into account the seaman's "attitude"-they take a look at him, I suppose, and say, "we do not like his looks"-if he comes up smiling, he is impudent, and if he looks gloomy, he is sullen -in any case he is a bad egg-after taking into account his attitude, if they think his attitude is not exactly what they like, they can send him back to gaol for six months. It is three months the first time, then six months, and if a total of nine months is not enough they can recommend his internment. They can at any time adjourn, and in the meantime the seaman has to stay in gaol. There is no sworn information laid as we know it in ordinary cases. There is no trial by a magistrate. The trial takes place before this self-appointed board of inquiry where the seaman has no advocate and no choice at all. He is not tried before an ordinary magistrate. Does not magna charts preserve the right of everybody to be tried before a jury of his peers? Can you call a naval officer a suitable man to be the peer of a seaman in the merchant service? I am not a lawyer, but I can see that there is no protection there for the seaman.
I would ask, is this procedure fair; is it just, or is it justified? Because some drunken sailor, perhaps meeting the mate off his ship in a saloon, using sailor language says to him that he will be so-and-so if he sails under such a slave driver, he can be railroaded into gaol for nine months and interned thereafter.
I am not exaggerating at all, because the committee:
. . . may in any case wherein an investigation has been conducted, direct in writing that any seaman be temporarily detained, if it is satisfied that there are grounds for believing that such seaman-
Remember it has only to be satisfied that there are grounds for believing; it has not to be convinced at all.
(a)	has been responsible or is likely to be responsible for causing delay in the departure of a ship.
A telegraph boy carrying a telegram may delay the sailing of a ship. Is he to go to gaol or be interned? Then (b):
(b)	has deserted or is absent without leave in Canada from his ship.
That is reasonable. Then (c):
(c)	has refused or is likely to refuse to sail on a ship;
(d)	has refused or is likely to refuse to perform his regular duties on board a ship;

War Appropriation-Transport
(e)	has induced or attempted to induce, or is likely to induce or attempt to induce other seamen to interfere in any way with the proper operation of the ship.
If one man says to another, "Thi3 is a h

of a hole," that, I suppose, is attempting to induce another seaman to interfere with the operation of the ship. Then (f):
(f)	has carried on or is likely to carry on any subversive activities, whether on board his ship or otherwise.
And then the same process is repeated all over again. We are supposed to be fighting a war for liberty. I remember that some years ago the then Minister of Mines and Resources, at the instigation of an Indian agent., brought in a bill making it a criminal offence liable to six or twelve months in gaol for a man even to think of holding a potlatch, which is an illegal ceremony, banned by the government, quite properly, in connection with certain Indian rites. That was to give the Indian agent some help in securing a conviction, because before that you had actually to catch the Indians doing it. So that he got the government to bring in this clause which said that a man could be hauled up and punished if he only had it in his mind, and the person who decided whether it was in his mind or not was the Indian agent who had him arrested. If you call that British justice! It only had to be presented to this house to be laughed out of court; it was so utterly against every principle of justice. Suppose there has been some trouble with a ship getting away; then by all means punish people who do anything subversive in the way of holding up a ship or trying to induce other men not to work; but why should a seaman be subject to all these restrictions and injustices? Are we to go back 200 years, and restore the methods of the press-gang, when they went along and dragged away a likely-looking man and put him in the hold and he found himself 200 miles at sea a day or two later. They used to do those things, but we do not do them now. Why should we inflict such a severe penalty without anything being proved against a man except that he may be likely or he is likely to do so-and-so? I do not expect the Minister of Transport to answer; possibly he knows nothing about it; but I should like the Minister of Justice to give us his idea as to whether he thinks that is justified.


Joseph Enoil Michaud: I did not catch the first few sentences that the hon. member stated. Would he be kind enough to give me the number and the first few words of the order in council of which he is complaining?


Alan Webster Neill: Yes.



P.C. 11397

[Stage Direction]
At the Government House at Ottawa Saturday, the 19th day of December, 1942. Present: His Excellency the Governor General in Council:
Whereas by order in council P.C. 2385, dated 4th April, 1941, an Order Affecting Discipline of Merchant Seamen was made, to 'be cited as "The Merchant Seamen Order"-[DOT]
That is under the authority of the governor general.
And whereas the purpose of the said order is to prevent delay in the departure of merchant ships from Canadian ports during the present emergency, and to provide that if delay occurs or is anticipated as being likely to occur by reason of the activities of a member or members of the crew of any such ship, there can be taken in respect of such member or members of any such crew such action as will prevent delay in the departure of any ship, and which will serve as a deterrent to members of the crew of any other such ship who might contemplate like activity.
Joseph Enoil Michaud: I think that explains the reason for the order in council. That is a war measure, passed to prevent mutiny, delays in sailings or departures from ports, through some members of the crew who might be on board as spies, or unfriendly, thereby developing a situation, which would hold up the whole crew and the boat. These rules are made to assure the disciplining of that person or those persons, and at the same time prevent during war time the delaying of merchant ships which might have to depart at a certain moment and, indeed, must depart at the moment which is stated, on account of the difficulties of sailing on the high seas through enemy interference. The order is made for that purpose. It is a war order.


Alan Webster Neill: The minister used the word
"mutiny." Lord bless me; we have never been in sight of mutiny. It says, if you are "likely to do" these things, "likely to refuse" to sail-


Joseph Enoil Michaud: Well?


Alan Webster Neill: Not, that the man has refused
to sail-


Joseph Enoil Michaud: That is mutiny.


Alan Webster Neill: -but that he "is likely to."
Has anything happened in the last few years in connection with sailing ships which would justify such an extreme measure? I recall an occasion when a Turkish sultan boasted to the English ambassador, "I know how to stop crime. There was a baker discovered giving short-weight in his shop one day, and we put the baker in his oven and baked him, and there has not been any case of short-weight

War Appropriation-Transport
since then." But that was a long time ago, and that is not the British system of doing things.


Joseph Enoil Michaud: My hon. friend understands that during the war all kinds of nationalities are represented in the crews of these ships. When foreign ships or British ships arrive at the port of Vancouver or Halifax or Saint John we do not know the character and background of these men. This was passed to prevent any possibility of any one or two or more men on board a ship holding up the ship for a few days and preventing its sailing when the road is clear.


Alan Webster Neill: The minister says that we
do not know the background of these men, and their character, and what they are likely to do. I do not know the background of half the hon. gentlemen in this house and I do not know what they are likely to do.


Gordon Graydon: You have a pretty good idea in some cases.


Alan Webster Neill: We do not know what we
would do under temptation. Some of us are likely to do anything.


Joseph Enoil Michaud: My hon. friend does not suggest that we apply these rules to the members of this house.


Alan Webster Neill: Absolutely. If it is good
for one man it is good for another. You cannot show that there is any mutiny or delay on ships, and you are taking an enormous power which cannot be justified. I will sit down and say no more if the minister says that it is a square deal. I ask him if he thinks it is.


The CHAIRMAN:: Carried.


Alan Webster Neill: Never mind its being carried.
Mr. ST. LAURENT: Has the hon. member any factual case to which have been applied any regulations which would violate the rights of a man concerned? It sometimes happens that these war orders are drawn by gentlemen who have recently come into the service and who make them just as stringent as the English language can provide. I have been concerned about the terms of some of these orders. I have had a number of them redrafted, and have expressed to those who are charged with enforcing them that mere convenience was not enough to justify departure from the ordinary rules of procedure, that it is only when it is necessary for the security of the state that there should be any such departure, and many of them have been "toned
down," shall I say, in expression. If the hon. member knows of any case to which rules have been applied which have really prejudiced the man's rights and the manner in which he should be treated, I should be glad to know the facts and I would at once follow the matter up-*


Gordon Graydon: You might tone it down a bit.
Mr. ST. LAURENT: -and point out how this power should be used. I have had to make, at the request of the Minister of National Defence for Naval Services, quite a large number of appointments to committees of this kind, and no instance has been called to my attention of harsh or unfair treatment having been meted out to anyone. But even that, I would admit, would not justify some of the terms which apparently are included in this order. I do not remember when it originated, but had it been one of the orders submitted to the department recently for redrafting it would not be in that form; and had there been any case in which a man's rights have been interfered with it would have come to my attention.


Alan Webster Neill: Not necessarily. The statement made by the Minister of Justice is entirely satisfactory to me. If he makes the statement that he will look into that particular order in council I shall be quite satisfied with what he does with it. I have not any specific case before me. I am not familiar with what goes on around Montreal, or even Vancouver, but the very fact that the order is in effect indicates that it will be used from time to time. If the minister will look at it and agree, if in his judgment it is necessary, that it be redrafted, I would be perfectly satisfied.


Joseph Enoil Michaud: Since the order has been passed, no case has been brought to the attention of the Department of Transport where any seaman has had occasion to complain, or where it has been necessary to apply these rules.


Alan Webster Neill: But take a man from Yugoslavia, or Russia, or Liverpool as far as that goes, and he gets a raw deal in Montreal or Vancouver; can the minister tell me what facilities an ignorant man has for reaching him?


Joseph Enoil Michaud: I think they can find channels, and they do complain.


[Stage Direction]
Item agreed to.
[Stage Direction]
War Appropriation-Transport
5. Marine service-
Marine service steamers including reconditioning of C.G.S. Lady Grey, and war risk bonus, $275,000.
Aids to navigation, $50,000.
Compensation to Canadian crews for loss of personal effects, $100,000.
Nautical services, $63,460.
Thomas Reid: Can the minister tell us the number of Canadian crews, and the amount of money paid last year for compensation? I notice in the estimates this year there is $22,000 odd of an increase. How many seamen received compensation, and what is the total amount paid?


Joseph Enoil Michaud: In 1940-41 there was an expenditure of $4,972; in 1941-42, $21,649, and in 1942-43 the expenditure was $77,893. The total is $104,514, the average being $135 per claim.


Thomas Reid: How many claims were there?


Joseph Enoil Michaud: I have not the number of claims, but the average was $135.


Angus MacInnis: This is a queer mixture of items; marine service steamers, including reconditioning of C.G.S. Lady Grey, and war risk bonus. Would the minister give a breakdown of the item. How much is for marine service steamers, how much for reconditioning the Lady Grey, and how much for war risk bonus?


Joseph Enoil Michaud: The amount estimated for this year is $275,000. The estimated requirements will be for the Canadian government steamship M. B. Maclean, $30,000; C.G.S. Brant, $11,150; Canadian government steamship Druid, $18,850; operating costs of miscellaneous steamers to cover out-of-pocket expenses, extra fuel and supply while engaged in incidental war work for Department of National Defence, navy, air and Newfoundland government, salvage by civic authorities, which are not provided for in the regular vote. At Halifax we have the Franklin, the Lady Laurier and the ice-breaker Sorel; at Saint John, the Dollard and the Laurentian; at Quebec, the Bernier and the Ernest Lapointe; at Montreal, the Sajeguarder; at Prescott, the Granville; at Parry Sound, the St. Heliers; at Victoria, the Estevan, and at Prince Rupert, the Alberni, $50,000. The estimate for repairs is $25,000, and the allotted amount for unexpected extra costs, $15,000. Of course the Lady Grey had to be reconditioned, and the amount estimated to be spent on her was $25,000.


Angus MacInnis: How much is for war risk bonus? There cannot be very much left.
[Mr. Michaud.1


Joseph Enoil Michaud: The amount for war risk bonus is $80,000.


Thomas Reid: Where is St. Charles river?


Joseph Enoil Michaud: That is near the city of Quebec.


[Stage Direction]
Item agreed to.
6.	Railway and steamship service-
Degaussing equipment for Canadian registry vessels, $300,000.
Additional harbour facilities at Halifax, $481,000.
Assistance to Canadian National Railway for development of Steep Rock mines, $400,000.
Refloating and repairing ss. Cornwallis, damaged by enemy action, $600,000.
Government Employees' Compensation Act- administration, $61,500.
Thomas Reid: How many vessels were degaussed last year? Is it the policy to degauss all vessels of Canadian registry? What is the average cost?


Joseph Enoil Michaud: The Canadian government absorbs the total cost of degaussing all Canadian registered ships as well as foreign conflict vessels either seized as prizes or requisitioned by the Canadian government, which have been or may be fitted with special defence apparatus. This applies to all ships of Canadian registry and foreign ships either seized or requisitioned.


Thomas Reid: I notice that assistance is being given to the Canadian National Railways to the extent of $400,000 in connection with the Steep Rock mines. I am not objecting to the appropriation to put the line through, but that should come under ordinary estimates.


Joseph Enoil Michaud: First, as to degaussing, the total number of ships last year was twenty-six.


Thomas Reid: And as regards the Canadian National appropriation, I suggest that that is hardly an expenditure that should come under war appropriation. It is a long-term expenditure for plant.


Joseph Enoil Michaud: This is an expenditure that need not necessarily be paid except in instalments on requisition from Canadian National Railways. It is an advance to the Canadian National Railways.


Major James William Coldwell: Do I understand that this is an advance for the current year and that further payments are to be made?


Joseph Enoil Michaud: This is an estimate for the current year.

War Appropriation-Transport


Major James William Coldwell: But that will go on for
several years.


Joseph Enoil Michaud: No.


Major James William Coldwell: What is the total amount that will be paid on this account? Is this an instalment?


Joseph Enoil Michaud: This is the estimated cost of construction of a spur line to the main line of the Canadian National at a point 150 miles west of Port Arthur to the Steep Rock mines property. The estimated cost is $400,000.


Major James William Coldwell: That is the total cost?


Joseph Enoil Michaud: Yes; that is the total cost.


Gordon Benjamin Isnor: I should like the minister to break down the item of $481,000 for additional harbour facilities at Halifax.


Joseph Enoil Michaud: The original estimate was $281,000, and it is represented that an additional $200,000 will be required to complete the work.


Gordon Benjamin Isnor: What particular work is it?


Joseph Enoil Michaud: The break-down is as follows: construction of scows, $30,000; repairs to scow dock, $15,000; rental of tugs, $36,000; miscellaneous and unforeseen expenses, to provide for new works and improvements that may be authorized during 1943-44, $200,000, making a total of $281,000. The $200,000 estimated for further requirements will be in connection with the construction of living accommodation for additional freight handlers and stevedores.


Harry Rutherford Jackman: In connection with the item of $400,000 in regard to Steep Rock, is there any provision for getting that money back as ore is shipped over the line, and does the money go to the Canadian National or does it come back to the government indirectly, through the Canadian National?


Joseph Enoil Michaud: It is an advance of capital to the Canadian National Railways in order to make possible the building of that spur line. As no doubt the hon. member is aware, the cost of this work is to be refunded to the Canadian National Railways by Steep Rock Mines Limited, when it is in operation, at the rate of twenty cents per ton. Here are the details. This is to help meet the cost of construction of a spur from a point on the main line of the Canadian National railway about 150 miles west of Port Arthur to the Steep Rock Mines company's property near Atiko-kan, and the construction of an ore dock at Port Arthur. The estimated cost of these
facilities is from two to two and a half million dollars; such sums or amounts as may be earned by the railway company in respect of assistance toward the transportation of ore, to the extent of twenty cents per ton on the first five million tons of ore handled, subject to having reserved therefrom an amount of six cents per ton to be applied to amortization of the cost of construction of the above mentioned spur and ore dock. There will be six cents per ton retained for the amortization of the cost of building the dock and the spur line.


Harry Rutherford Jackman: Does that six cents go to the Canadian National, and is it in turn refunded to the government? In regard to the $400,000, does the government take back a note from the Canadian National, or is it simply a war expenditure for which no tangible evidence is retained by the government? What are the transactions when you deal with this $400,000? Do you simply give it to the Canadian National for the construction of the spur line, or do you take back a note from the Canadian National, which note will be liquidated out of the six cents per ton on the ore which may be handled in future?


Joseph Enoil Michaud: We make a contract with the Canadian National, and these are the terms of that contract.


Harry Rutherford Jackman: Is the $400,000 a liability on the books of the Canadian National?


Joseph Enoil Michaud: No.


Harry Rutherford Jackman: Or is it for the time being a gift by way of a war expenditure by the government?


Joseph Enoil Michaud: It is not a liability on the books of the Canadian National; it is a war expenditure, and the agreement provides that if the Canadian National are recouped, then they recoup the crown.


Harry Rutherford Jackman: It is something like the aluminum deal; if the property is used, the money will be paid back, but if it is not used, the money will not be paid back.


John Ritchie MacNicol: It will never be paid back anyway.


Harry Rutherford Jackman: Then, in regard to the item of $300,000 for degaussing equipment for Canadian registry vessels, who does this work? Is it done by the government, or is there a contract with somebody else?


Joseph Enoil Michaud: It is done by the technical officers of the Department of National Defence for Naval Services.

War Appropriation-Transport


Harry Rutherford Jackman: I should like to ask a question in regard to the steamship Lady Grey. Is that boat owned by the Canadian National West Indies steamship line?


Joseph Enoil Michaud: No; it is owned by the department.


Harry Rutherford Jackman: I thought all the Lady boats were supposed to be owned by the West Indies line.


Joseph Enoil Michaud: The modem Lady boats were owned by the West Indies line, but not old boats like the Lady Laurier and the Lady Grey, which were built for the government service thirty-six years ago.


Thomas Miller Bell: Did I understand the minister to say that included in the $481,000 for the port of Halifax, there is $200,000 for miscellaneous and unforeseen expenditures?


Joseph Enoil Michaud: Yes; $200,000 is provided for unforeseen expenditures during the year.


Major James William Coldwell: That seems rather a large amount for unforeseen expenditures.


Joseph Enoil Michaud: It would be at any other place than Halifax during the war.


Major James William Coldwell: Saint John, for example?


Joseph Enoil Michaud: Well, in connection with Saint John wc might find that we have to make many expenditures that were unforeseen a few months ago.


Harry Rutherford Jackman: Would the minister be good enough to explain this item of $600,000 in connection with refloating and repairing the steamship Cornwallis? Whose ship is it?


Joseph Enoil Michaud: It belonged to the West Indies line. It was torpedoed, and it was thought by both the underwriters and the officials of the company that it would be cheaper to refloat and refit the boat and put her back into service than to build a new boat to take her place.


Harry Rutherford Jackman: Who owns the ship now?


Joseph Enoil Michaud: The crown will own the boat, and I suppose will have to fight it out with the Canadian National as to whether the salvage would have been greater than the amount spent to refit her. But that matter has not been determined yet, because the boat is not in commission.


Mr. KINLEY:: Was she insured?


Joseph Enoil Michaud: Yes.


Gordon Benjamin Isnor: I think this would be an appropriate place for me to bring to the attention of the Minister of Transport the disaster which took place in Bedford basin a short time ago, in which nineteen lives were

lost. I realize, of course, that a public inquiry is in progress at the present time. I am most interested in providing equipment in the future, such as diving equipment, so that it may be on hand to be used immediately for rescue work, in the event of our being so unfortunate as to meet again with such a disaster. I am informed there is no suitable equipment at Halifax or at Bedford basin, and I believe there should be. I have received letters asking me to bring this matter to the attention of the minister, and I do so knowing that he will realize the importance of Halifax harbour, and the dangers which must lurk there on account of the heavy traffic passing in and out. I would ask him to take these points into consideration, having in mind the possibility of procuring diving and other equipment which might be required.


Joseph Enoil Michaud: This question is now under consideration.


[Stage Direction]
Item agreed to.
Purchase of railway equipment for Canadian National Railways, 1941 orders, $4,883,664; 1942 orders, $24,543,000.
Gordon Benjamin Isnor: We have very little opportunity to discuss either in the committee or the house matters affecting the Canadian National Railways. Therefore I shall take this opportunity to bring to the attention of the committee a condition existing in respect of trains operating out of Halifax. I recently made an inquiry of the minister, in reply to which a return was tabled a few days ago. My question had to do with the number of trains operating between Halifax and Moncton and Moncton and Campbellton. The reply I received was that whereas there were three trains operating between Halifax and Moncton, there were four operating between Moncton and Campbellton.
This is not a question of my province against the minister's native province; it is not a question of Nova Scotia against New Brunswick. But the minister cannot help being aware of the heavy traffic being carried at the extreme eastern end of the Canadian National Railways. He knows that practically no train leaves Halifax which is not overcrowded; and that applies to all trains. The Ocean Limited and the Scotian leave in the morning, and the Maritime in the afternoon; and all are crowded. I would urge that the minister take into consideration the providing of extra trains to fill the much needed requirements from Halifax northward.
I do not wish to take up the time of the committee in giving details as to population, the number of stops and the places served by these trains, but I would say that the three

War Appropriation-Transport
trains running between Halifax and Moncton serve a population of 127,000 along the line, as compared with a population of 43,000 or 44.000 served by the trains running between Moncton and Campbellton.
Then, I would bring to the minister's attention the matter of the running time, particularly as it applies to the Maritime. The running time of that train is eight hours and thirty minutes from Campbellton to Halifax. It appears to me, and also to a great many rail-waymen who have been in the service for a long time, that this train could be speeded up to a certain extent. This would help to relieve the situation, and give the minister an opportunity to provide additional trains between the others I mentioned, namely, the Ocean Limited, the Scotian and the Maritime. It might be possible to put on additional trains, or to add second or third sections to the trains now running.
We in the maritimes certainly appreciate the good service we receive from the Canadian National Railways, so far as they are able to serve us. This observation applies particularly, I believe, to train crews and the handling of freight. But I must say we are not satisfied with the passenger service, because we do not think the community is being served in the manner in which we believe it should be served.


Joseph Enoil Michaud: I can appreciate what has prompted the senior hon. member for Halifax to present his case. I know that on many previous occasions he has described the situation to me, and of course he is more familiar with local conditions than I am. Nevertheless he must realize the situation which exists on the railway lines between Moncton and Halifax. If there is any shortage of passenger facilities between those points, he will understand it is not owing to any ill-will, negligence or antipathy on the part of railway officials. It is owing to conditions which are well known, and cannot be overlooked. However, I shall be pleased to direct the attention of the administrators of the line to the remarks of the hon. member.


Gordon Benjamin Isnor: May I thank the minister
for his reply. However, I would emphasize one point I made in only a casual way. There are four regular trains serving the district between. Moncton and Campbellton, whereas there are only three between Halifax and Moncton. In view of the respective populations of these communities, I say that service should be reversed, and there should be four trains between Halifax and Moncton and three between Moncton and Campbellton. I leave that point with the minister.


Joseph Enoil Michaud: I agree that in normal
times what the hon. member has said might be so. But he must realize that there is a tremendous congestion of traffic between Moncton and Halifax, a much greater amount than on other sections. Three lines meet at Moncton. There is a single track from Moncton to Halifax.


Major James William Coldwell: Is this amount for
rolling stock and equipment?


Joseph Enoil Michaud: Yes.


Major James William Coldwell: Is it for passenger and
freight engines and oars? May I say, incidentally, that I believe the Canadian National Railways are giving a splendid service. We have to use the railways a great deal in travelling from here to the west, and I can state that both railways are doing their best. However, there is a terrific shortage of equipment, and perhaps we have had a good opportunity to note that fact. The senior hon. member for Halifax has probably noted the shortage in respect of dining-cars. I have seen people standing two or three hours in line to get into the car for their meals. I believe that is due not only to the shortage of dining-cars, but also to the shortage of help. How is this sum divided? Are freight cars receiving priority, or does the priority go to passenger cars or to engines? What is being done?


Joseph Enoil Michaud: I am afraid the hon.
member will be disappointed. There is no provision for passenger accommodation. We have to give priority to other equipment, and in these days it is impossible to get passenger equipment out of the shops. I shall give a list of the requirements covered by these amounts.
Out of the 1941 appropriation of $25,000,000 there is a balance of $4,863,664.23 unexpended. This is to cover the cost of 742 box cars and fifty baggage cars. On the 1942 programme there is an amount of $24,543,000 to cover the cost of thirty locomotives, 300 refrigerator cars, 1,750 hopper cars, 200 flat ears and 4,000 box cars.


Major James William Coldwell: I realize that under war conditions freight cars should have a priority, *but the fact is that there have been lay-offs in some of the railway shops. I do not know very much about the Canadian National shops, but I do know there have been lay-offs in the Ogden shops at Calgary and I believe there have also been some at the Transcona shops. I wonder if we have not reached the point where, if we can get steel, we should be able

War Appropriation-Transport
to utilize some of these men who are experienced in building railway cars to build more passenger cars, even if we have to make a larger appropriation. As I said before, the railroads are giving the best service they can under very difficult conditions, but the travelling public is feeling the effect of the shortage of railway accommodation.


Joseph Enoil Michaud: I fully appreciate what my hon. friend has said, but he has touched the point when he says, " if we can get steel." If we could get steel, we would do it.


[Stage Direction]
Item agreed to.
8. Loan to Canadian National Railways for development of Vermilion oil fields, $600,000.
Mr. FAIR:: Could the minister give us some particulars of the work that is being carried on in the Vermilion oil field and the progress that is being made?


Joseph Enoil Michaud: This is a loan to be made to Canadian National Railways. On October 1, 1942, an order in council was passed authorizing the incorporation of a company to be operated by or on behalf of Canadian National Railways to carry on the development of the Vermilion oil field. The Canadian National Railways investigated this oil field and alternate sources of supply and recommended the development of this field of over 600 acres, which is sufficient to support fifty productive wells. Another order in council was passed authorizing an advance by way of loan to Canadian National Railways of a sum not exceeding $1,000,000, with interest at three and a half per cent per annum, repayable in five years. The subsidiary company is to refund to the railway company the net proceeds from the sale of oil after proper royalties, interest, operating and other incorporate expenses have been paid, the railway company in turn to apply such proceeds to the reduction of such loan. Any remaining obligation to the government when the operations are wound up are to be discharged by Canadian National Railways.


John Ritchie MacNicol: Is the Canadian National Railways actually drilling wells and producing oil?


Joseph Enoil Michaud: That is what I am informed.


John Ritchie MacNicol: For its own use?


Joseph Enoil Michaud: I do not know to what extent.


John Ritchie MacNicol: Surely it would not be producing oil to sell in competition with other producers?


Joseph Enoil Michaud: Not to compete against oil producers.


Robert Fair: Why was it necessary for the Canadian National to go in there? Was the company which is in there already not producing sufficient oil?


Joseph Enoil Michaud: This matter was discussed on a former occasion by the Minister of Munitions and Supply. The actual working would not come under our supervision; we have it incidentally because the sum was advanced through the Department of Transport to Canadian National Railways.


Mr. EDWARDS:: Do I understand the minister to say that drilling is actually being done by the railway company?


Joseph Enoil Michaud: No, I am not saying that. I know they have commenced to explore or to get something under way, but I do not know to what extent.


Manley Justin Edwards: I understand that a
separate company was incorporated to carry on this work?


Joseph Enoil Michaud: That is true, authorized by the order in council.


Manley Justin Edwards: And this money is being advanced to that company?


Joseph Enoil Michaud: The subsidiary company, through the Canadian National Railways.


George Henry Ross: What is the name of the company?


Joseph Enoil Michaud: Cannar Oils Limited.


Harry Rutherford Jackman: Do I understand that $600,000 has been given to Canadian National Railways, directly or indirectly, to gamble on the development of oil in this field, and a further $1,000,000 at three and a half per cent to permit the development of oil? Have any results been shown so far? This seems to me to be an extraordinary step, one in which a major policy is involved.


Joseph Enoil Michaud: As I said before, the Minister of Munitions and Supply who is responsible for this project has already given an explanation. I understand that the dominion geologist, the oil controller and officials of Canadian National Railways were satisfied that the purpose for which this oil might be required would justify an investment of $1,000,000, and the Canadian government has agreed to lend the money to the Canadian National Railways at the rate of three and a half per cent per annum, to be repayable in five years. Canadian National

War Appropriation-Transport
Railways are authorized to advance money to the subsidiary company, Cannar Oils Limited.


Harry Rutherford Jackman: What particular facilities have Canadian National Railways for the development of oil? If the Minister of Munitions and Supply is the instigator of this expenditure of public moneys, why does he not set up a company which would be able to retain professional oil people who might know something about the business? I know of no one on the staff of the Canadian National who could qualify as an expert in oil drilling. This is an extremely hazardous business. A great deal of money has been sunk in attempting to bring in wells in western fields, sometimes with success but naturally more often without success. I think the committee is entitled to know what reasons there were for advancing $600,000 in one case, and $1,000,000 additional by way of a loan with the expectation that some oil might result.
It may be true that dominion geologists say there is a prospect of developing oil in a certain field, but geologists have often said that a structure is such that there might be oil there and nothing results. Everyone knows there is perhaps no greater gamble than attempting to extract oil from the bowels of nature. I think the committee is entitled to a full explanation of the reasonableness of this appropriation and the method by which it is proposed the money shall be spent, namely, by the Canadian National instead of by a separate government-owned company, or perhaps by private enterprise. The house argued for some time when the budget resolutions were being considered in an endeavour to make it more feasible or more possible for private enterprise to develop oil with some expectation of profit where wells were discovered in western fields, but without much success. The Department of Finance did not hold out much prospect of the venturesome capital which might be successful in producing oil retaining fairly adequate profits. Yet we find the government putting in its own money through an organ of the government, namely, the Canadian National, which to my mind is fitted in no way whatsoever for the development of oil in this country.


Joseph Enoil Michaud: That may be so, but the Canadian National is a great consumer of fuel oil, especially in western Canada, and is equipped with a department of national resources of its own to investigate sources of supply for its requirements.
Someone has asked if this is to compete with private producers. This is a development of the Canadian National Railways to 72537-313
provide its own oil requirements for its operations in the west. Those who come from the west know that in British Columbia, Alberta and Saskatchewan the railway needs large quantities of fuel oil for its operation, and this is an investment made to assure, if possible, a supply of oil for the requirements of the railway. It is being undertaken by the railway itself just as it looks after its other requirements, and we consider that the railway should take the responsibility of undertaking this development. I understand that the Canadian National have taken the precaution of consulting government geologists and the scientists of their own staff, and I have no doubt they have retained the best brains possible to help bring this field into production in order to assure a sufficient supply of oil for their requirements in the west. The fuel oil supply in the west is a difficult problem, and it may become more difficult. The Canadian National Railways have had to import large quantities of oil, and if the source of supply were cut off, it would be very unfortunate.


Robert Fair: I do not think the Canadian National Railways are taking any chances, because the Vermilion field is already proven; anyone passing on the train can see dozens of derricks all through that district. It is a good proposition.


John Ritchie MacNicol: And they are producing the oil.


Robert Fair: Yes, and there is a refinery there, too.


Major James William Coldwell: I think the railway is to be commended for undertaking this work and developing that field. I am very glad to see it, and if the railway can provide fuel for its engines, so much the better for itself and so much the better for the country. I hope it will strike oil richly.


Manley Justin Edwards: The hon. member who spoke a moment ago should not confuse the Wainwright-Vermilion field with the Turner valley field in regard to the cost of drilling. The wells in the whole Vermilion area are shallow, and the cost of drilling a well there is negligible as compared with the cost of drilling in the foothills area farther to the west. As the minister has just said, the oil produced in the Vermilion area is a very low-grade crude oil and cannot be treated in the same way that the finer oil nearer to the mountains is treated and refined into gasoline.
I do not think the Vermilion oil is refined before it is used in the railway's locomotives.



War Appropriation-Transport
It should also be borne in mind1 that practically all the locomotives on the main line of the Canadian National Railways are oilburning.


Robert Fair: I believe that the depth of the wells in the Vermilion area is under 2,000 feet, so that it is not as expensive to drill there as some people may imagine.


Grote Stirling: I have been trying to make the estimates for transport services under the war appropriation measure as set out on March 3 in Hansard tally with the items which are on this sheet before us.


Joseph Enoil Michaud: Air services are not
included in the main estimates.


Grote Stirling: Take, for instance, item 3 on this sheet: Director of Merchant Seamen. The amount on the sheet is a little over one million dollars, while the item given in Hansard on March 3 is just under one million dollars. Again, with regard to item 6, additional harbour facilities at Halifax, the amount on the sheet is $481,000, and the amount in Hansard of March 3, $281,000. What explanation is there for the items not agreeing?


Joseph Enoil Michaud: New requirements.


Grote Stirling: Is there an increase here over what the Minister of Finance put before us in Hansard?


Joseph Enoil Michaud: I do not think so.


Grote Stirling: They do not agree anyway.


[Stage Direction]
Item agreed to.

[Stage Direction]
Mines and geology branch-
Investigations of petroliferous deposits and of potential petroliferous areas in Canada, $500,000.
Major James William Coldwell: Last night we asked the minister what exploratory work was being done for oil deposits, and the minister in reply covered pretty exhaustively the work that is being done on the prairies and in the north. I was wondering what was being done on the Atlantic and Pacific coasts, and in other parts of Canada in the way of exploration for new fields.


John Ritchie MacNicol: The minister said last night that $42,000 had been spent on an investigation of the shale deposits of New Brunswick?


Major James William Coldwell: What about the Gaspe peninsula?


Thomas Alexander Crerar: None of this expenditure is for the Gaspe peninsula.
Before I answer my hon. friend's question I want to correct an impression that was given last evening when we were on these estimates and I was speaking of the number of parties that would be financed out of this vote. We have made provision in the ordinary estimates for a number of parties; they will be paid for out of the ordinary estimates, but additional parties may be sent out and paid for out of this vote. I think I mentioned last night that seventeen parties would be taken care of out of this vote, but that is scarcely an accurate statement. I am not able to say just how many parties will be taken care of out of this vote, but I shall have more information when the main estimates are before us later.
In reply to the question of the hon. member for Rosetown-Biggar, I find there are a number of parties here, but generally speaking the search for oil is being carried on in Alberta and northeastern British Columbia. I mentioned last evening one party which was working, I think, in southwestern Saskatchewan. In addition, there was an expenditure in New Brunswick on the oil shales, and also some expenditure in Nova Scotia, but not of a very large amount.


[Stage Direction]
Item agreed to.
Mines and geology branch-
To provide for special exploration and development work in connection with the supply of strategic minerals, $500,000.
John Ritchie MacNicol: Where is any development work going on-not exploration, but development?


Thomas Alexander Crerar: This is for special explorations and development work in connection with the supply of strategic minerals.


John Ritchie MacNicol: I understand that. What I want to know is, where is any actual development going on, under this vote?


Thomas Alexander Crerar: It was approved on the recommendation of the metals controller and the director of the mines and geology branch. Before any of the money is spent, the metals controller has to make a recommendation and it has to be concurred in by the director of the mines and geology branch. When these two officials agree, the matter is submitted and certain projects or explorations are undertaken and are cared for out of this vote.


Major James William Coldwell: Was there an item
under the same heading last year?

War Appropriation-Mines and Resources


Thomas Alexander Crerar: Yes; last year there was
released from the war appropriation $413,500, and I think $323,520 was spent. I do not know whether all the $500,000 will be used this year or not. It is simply an estimate of what may be required. It may be that not more than half will be spent.


Thomas Miller Bell: How much was exploration and how much development last year?


Thomas Alexander Crerar: Pretty nearly all was
development work, loans to companies, to be repayable out of their earnings, in the search for strategic minerals. There were administration costs, which last year ran to over $13,000. Then there was an equipment pool; that was a pool of diamond drills, drilling machinery, and the like, which could be used and directed from one point to another point. Many of the concerns did not have equipment of that kind and could not get it, so that this pool was provided. Let me repeat that all this was done on the recommendation of the metals controller.
Then, fluorspar was a mineral in considerable demand and of considerable importance, and arrangements were made with several companies for the development of fluorspar deposits which they had, but which they were unable to proceed with unaided. Money was advanced under agreements recommended by the metals controller, the advances to be repaid out of the proceeds of the fluorspar produced.
Chromite was another one. An arrangement was made with the Base Metals Mining corporation to carry on certain exploratory and testing and drilling work on certain zinc deposits in one of the western parks.


Mr. ADAMSON:: That was not a Base
Metals mine; that was another mine?


Thomas Alexander Crerar: That is correct, I am advised. Then, $5,000 was provided to the British Columbia war metals research board to carry on certain work.


John Ritchie MacNicol: That was returnable
too?


Thomas Alexander Crerar: No; that is not to be
returned. That was really for scientific investigation work by this board.


Thomas Reid: What 'board is that?


Thomas Alexander Crerar: It is the British Columbia war metals research board.


Thomas Reid: Is that under the provincial
government bureau of mines?


Thomas Alexander Crerar: It is connected, I understand, with the university of British Columbia.
Then we have scheelite, from which tungsten is derived. That is very important. Some of the gold mines have scheelite in association with gold. That is particularly true of the northwestern part of Quebec. Therefore the scheelite concentrator at Val d'Or in northern Quebec was assisted to the extent of $7,000.
The manganese deposit in Nova Scotia was assisted to the extent of slightly over $19,000. There was another tungsten deposit in Nova Scotia, upon which almost $29,000 was spent. There is another item, Orford Mining company ; I think that was for chromite. Chromite Limited received $82,000. Another manganese concern received a very small amount, $927. Then there was a molybdenite deposit in northern Quebec.


John Ritchie MacNicol: Where was it?


Thomas Alexander Crerar: At Quyon, Quebec, not
very far up the river. I understand it received assistance to the extent of almost $7,000. Then there was a molybdenite deposit in British Columbia which was examined, on which $4,000 was spent. An examination of the possibilities of tin was made at a place called Rush lake, in Manitoba. There are tin deposits there, and examination was made as to the quality or grade of the deposit.


John Ritchie MacNicol: Was any money advanced in connection with the discoveries of manganese in the vicinity of the Manitoba lakes?


Thomas Alexander Crerar: No. I am just running
over the various projects, in reply to the request of the hon. member for Rosetown-Biggar.


Angus MacInnis: Would the minister give in each case the name of the company and the amount received?


Thomas Alexander Crerar: The Rush lake investigation was carried on, I am informed, by officials of the department. I do not know who owned it. Then there was the Regal Snowflake concern in British Columbia. That involved $3,200. Then there was the H. C. Miller fluorspar deposit in eastern Ontario, $26,000, and another fluorspar deposit, Trent, Fluorspar company, in which $3,700 was spent. That generally describes the nature of the expenditure. In some cases this would be recovered; in other cases, if the deposit is not a commercial proposition it will not be. The need for all these so-called strategic metals has been very pressing, and in no case was the work undertaken except on the recommendation of the
4954	COMMONS
War Appropriation-Mines and Resources
metals controller, whose recommendation was concurred in by the director of the mines and geology branch. There were a good many proposals put up that were not considered worthy of investigation. That is briefly the type of thing that has been going on.


Major James William Coldwell: Does this department or the national research council do any work in connection with the finding of aluminum clays in Canada? If so, with what success? Some work has been done in the Dakotas south of Saskatchewan and stretching towards Manitoba. There are clays, I know, in the Dakotas, of the type we have in some parts of the prairies, which contain not as much aluminum as bauxite, but a considerable amount. If supplies were difficult to get, or if the submarine menace increased, which I do not suppose it will now, that might be a strategic mineral. Has the department done anything in experimenting with these clays, or have we any such clays in Canada? I am told that such clays exist immediately south of the prairies, in the states to the south.


Thomas Alexander Crerar: So far as Canada is concerned I have no knowledge, nor has the department any knowledge, of any bauxite.


Major James William Coldwell: Not bauxite.


Thomas Alexander Crerar: Well, no, not bauxite, but any clays of a kind that will produce the raw material for aluminum.	,


Major James William Coldwell: I believe that some
slight investigation has been made by the university of Saskatchewan and they have discovered some very low-grade aluminum clays. I believe I am right in that.


Thomas Alexander Crerar: Of course, no specific search has been made. Perhaps that is not the correct way of putting it, but there has been an alertness to learn of any deposits anywhere that could be utilized in the production of aluminum. Certainly, however, it has not been brought to my attention, if there are such, and I know that no recommendations have come from the metals controller for the development of such deposits. That does not say that they may not exist in Canada, nor does it say that somewhere in Canada at some time we may not find bauxite. I think it unlikely; but as hon. members know, there have been developments in the last year or so, which were discussed by the Minister of Munitions and Supply when his estimates were up, out of which has developed the production of magnesium metal. I understand that there is a considerable quantity of raw material, ores or clays, out of which magnesium metal can be made in Canada, and it may well be that such metal in the future will be a

competitor with the aluminum metal. I understand that magnesium metal has the qualities of aluminum and the virtue of being lighter.


Mr. DIEFENBAKER:: Of the amount expended last year, how much went to private companies? I understand that under the regulations any work that is undertaken other than by the Department of Mines and Resources must be under agreement or contract approved by the governor in council. How much was actually expended by grant to private corporations? How much has been expended in Saskatchewan in connection with this work, and has not the department of natural resources of the province brought to the attention of the minister certain possible areas where strategic metals can be found? If so, where are those areas?


Thomas Alexander Crerar: I have not the detailed information to answer the first part of my hon. friend's question, as to how much was spent through the agency of private companies. I read the names and gave the assistance they received. These advances to companies are all made by order in council on my recommendation, but that recommendation is not made to council until a request is received, supported by the metals controller.


Major James William Coldwell: Are they all repayable?


Thomas Alexander Crerar: Some are repayable. For instance, we may make an advance to some company and the judgment in regard to it may prove to have been wrong. There is a certain element of risk, but wherever a company gets into an operating position and can repay, it is expected to repay, and the agreement calls for repayment with interest.
In regard to the other question raised by the hon. member for Lake Centre, I doubt if there has been anything in the nature of an active search for strategic metals in Saskatchewan. I think it is a fair assumption that the northern part of Saskatchewan, and particularly the northeastern part of the province, which is in the so-called pre-Cambrian shield, will undoubtedly in time develop mines. There is on the border of Saskatchewan and Manitoba the mine of the Hudson Bay Mining and Smelting company at Flin Flon. But these expenditures for strategic minerals were directed to the places where it was thought most likely they could be found. That again was done on the judgment of the officers of the department, who are supposed to know. None of these investigations was carried out simply for the pleasure of spending some money. They all had behind them some reasonable prospect of

War Appropriation-Mines and Resources
being valuable in supplying these metals, some of which were in very short supply and were greatly needed in the war effort.


John George Diefenbaker: Did the department of mines of Saskatchewan not bring to the attention of the minister or his department certain strategic metals which it believed could be found in certain parts of northern Saskatchewan, at the same time designating where those metals were believed to be available?


Thomas Alexander Crerar: I cannot recall at the
moment, but I think I am correct in saying that all the provinces have been bringing to the attention of the department here the possibilities in their respective provinces. I dare say there were hundreds of these prospects placed before us, a great many of which were not acted upon. The investigations that were actually made, or the engagements that were entered upon, were on the recommendation of the metals controller, as I said a moment ago, supported by the director of the mines and geology branch.


John George Diefenbaker: Apparently there were no investigations carried on in Saskatchewan, since, if I understood the minister aright, no expenditures were made in that province. There is widespread complaint in Saskatchewan because it seems impossible to get any cooperation from the metals controller for consideration being given to northern Saskatchewan. An outstanding friend of the government in northern Saskatchewan-I am not going to mention his name unless the minister asks for it-has brought to the attention of the metals controller certain metals that he believes exist there in such abundance as to be of assistance to the war effort of this country, but he has been unable to get any consideration whatsoever. I feel that if the provincial department of mines brings these matters to the attention of the government, its recommendations should be acted upon. We in Saskatchewan have a large area in the pre-Cambrian shield. There is now an opportunity under this vote to determine whether or not these areas contain metals which are needed at the present time. The provincial department of mines and resources has devoted its energies over a period of years to ascertaining these localities; yet that province has not been given any assistance under a similar vote last year, and we have been afforded no opportunity whatever to assist in the war effort in this regard.
I ask the minister during the coming year to see to it that we receive at least some consideration in this connection. As far as the war effort is concerned, little industry has been
established in Saskatchewan and little consideration has been given the needs in this regard of that province. I quite realize that there should be some probability of success before an area is examined and prospected under this vote. Many areas in northern Saskatchewan have been carefully examined by the provincial department of mines, and I ask the minister to see to it that this year some of this money is spent in that province, to the end that we may be enabled to contribute our share of the mineral needs. Apparently no money has been advanced and no assistance has been given to mining development in Saskatchewan, and no official in Ottawa can determine, without some investigation, whether or not strategic materials are available there.


Thomas Alexander Crerar: Of course I shall give heed to the plea advanced by the hon. member for Lake Centre. I do not know that he would suggest that the department should go over the head or back of the recommendations of the metals controller, or act in these matters without those recommendations. I am not exaggerating when I say that scores of these prospective mines have been brought to the attention of the department. Naturally people who have mines of this kind, who think they have fluorspar or scheelite or molybdenite, believe there is a possibility of getting some public funds to assist in the development of their properties, and my hon. friend has had sufficient public experience to know that one must be very careful in, shall I say, resisting some of the requests that come in that way. I have confidence in the metals controller; he is a man of great experience in the mining business, and I think is a mining engineer by profession, and I have every confidence in the technical officers of the mines and geology branch of the Department of Mines and Resources.


John George Diefenbaker: And have they
recommended against Saskatchewan?


Thomas Alexander Crerar: 'No; they have not recommended against Saskatchewan, but I would say that no proposals have come to my attention concerning Saskatchewan which have been recommended by the metals controller and the director of the mines and geology branch. It is not a matter of recommending against something; it is a matter of recommending in favour of, recommending positively instead of negatively. I may have erred, and the government may have erred, but we felt the safe course was to follow the advice of the people who we thought were qualified to give advice in these matters. This does not mean that the provincial department of mines and
4956	COMMONS
War Appropriation-Mines and Resources
natural resources has not been active. As I said a moment ago, I think all provincial governments have brought to the attention of the department here the possibilities that existed in their provinces, and have asked that something be done to explore those possibilities. Rightly or wrongly, however, we have adopted the rule that we would recommend to council only those proposals which, in the judgment of the experienced men who were advising us, were entitled to consideration.


John Ritchie MacNicol: May I ask the minister if there are not large deposits of dolomite in northern Saskatchewan?


Thomas Alexander Crerar: There may be; I cannot say.


John Ritchie MacNicol: I have been told there are; and if there are large deposits of dolomite, perhaps the government should take the same action to assist in the production of magnesium metal in Saskatchewan that they took in regard to the production of magnesium metal in the Ottawa valley. In Saskatchewan the government would have to find power, just as the Ontario hydro electric commission found power for the magnesium plant at Haley station. I am firmly convinced that there must be a distribution of industry throughout Canada, and if there are large deposits of dolomite in northern Saskatchewan, power can be developed. I know where a substantial block of power can be developed, and if you put the two together you get magnesium metal.


Major James William Coldwell: I do not have quite the confidence in some of the controllers that the minister has. I believe that when this exploratory work is being undertaken, the northern part of the province of Saskatchewan does offer a field for exploration for a good many of these things, as the hon. member for Lake Centre has said. When the minister pins his faith entirely upon the metals controller, I do not think he is wise. I remember that a year or two ago the matter of iron ore on the Pacific coast came up; but in spite of the forceful presentation made by hon. members from the coast, and in spite of the fact that to me the evidence they presented was fairly conclusive, the only reply they could get was, "Well, you have not a ghost of a chance," merely because there was an established industry in another part of Canada. That is, virtually, the point of view. I think I would put much more faith in the report of the minister's own geological branch, as a matter of fact. They are public servants, who cannot look at it from the point of view of established industry.

But' I think we need to diffuse industry across the country. It is perfectly true, as the hon. member for Lake Centre has said, that in Saskatchewan, with all our resources, we have been unable to get any development during the war, for war purposes, which would assist us after the war in solving some of our problems in that area. We have potential power on our rivers, much more, I believe, than is generally supposed. And we certainly have an extremely large potential power supply in our very large deposits of comparatively low-grade coal, a kind of coal which has been used in Russia and in Germany for the production of power. And probably with the resources we have developed, industries could be established in some of these areas. I saw one hon. member shake his head' when I spoke about the low grade of coal utilized in Germany for power purposes. They utilize brown coal, which has even fewer British thermal units than the gray coal which we use in the southern part of our province.
I know that the Alberta coal is much superior. But in our gray coal we still have a source of power. I was not speaking from guess-work, when I spoke a few moments ago about the possibility of finding not bauxite, but clays which do contain a fair, and perhaps a commercial percentage of aluminum. I was surprised that the minister knew nothing about it, because I know some work has been carried on in connection with testing some of these clays.


Thomas Alexander Crerar: By private parties?


Major James William Coldwell: By the university. I am surprised the minister did not know anything about it, and I would suggest that some inquiries be made.


Manley Justin Edwards: Does the hon. member know where they are making alumina from
clays?


Major James William Coldwell: No; but I can say this, that we do know that there is more than one process of making aluminum. The process being used at the present time is the established process, because all the equipment made and used by the company which has the monopoly of that business is of the one type. But it is known' that there are other processes which might utilize the lower grade clays. How economical that would be, I cannot say.


Manley Justin Edwards: I agree. I was interested in the hon. member's statement. I believe it is well known that all clay contains more or less alumina.


Major James William Coldwell: Some.

War Appropriation-Mines and Resources


Manley Justin Edwards: Some clays are much richer than others. There is a gentleman right here in Ottawa, I believe, who for a number of years has been doing research work throughout the continent. But I have yet to find any instance where a process of extracting alumina from the aluminum clays has been demonstrated to be economically feasible.


Major James William Coldwell: That is, of course, an important point for consideration.


Thomas Reid: I have two questions to ask the minister, the first of which has to do with the long list of metals which he enumerated. In view of the expenditure of money, my first question is this: Is the minister in a position to tell us if help has been given to companies for development work, and if some of these moneys have been expended in that way? If so, have those expenditures been the means of producing certain quantities of the metals he enumerated?
My second question has to do with exploratory work in connection with iron ore. It is a well-known fact that the iron ores in the lake Superior area may not last longer than another ten years. I am speaking of the openpit method. It may be that we shall require all the iron ore we can get in Canada, and I am wondering if in the exploratory work the minister is seeing to it that the deposits or iron ore in Canada are being tabulated as to quantity, location and iron content. To my mind it is extremely important to do that sort of thing. As was pointed out by the hon. member for Rose-town-Biggar, we in British Columbia have been endeavouring for many years to develop a steel industry in that province. Time and again w'e have been met with contradictory reports-reports from private mining companies, provincial reports and federal reports, all conflicting. In view of the seriousness of the iron ore situation, and the extent to which iron ores may be required in this country, I say it is incumbent upon the government to see to it that exploratory work is done. Under this or any other grant, what has been done with regard to iron ore? Then, of the various metals enumerated, have any quantities been produced?


Thomas Alexander Crerar: In some instances substantial quantities of these strategic metals have been made available as a result of this work. I do not know the exact amount of tungsten, for instance, that has been produced in Canada in the last year; and I do not believe it would be wise for me to give that information if I did know. Generally speaking, however, it may be said that
this expenditure has justified itself for the purpose for which it was initiated, namely to aid in the war effort. Probably if there had been no war, nothing of this kind would have been done in Canada at the present time, because we would have been getting our tungsten, molybdenite and chromite from other sources.
With regard to the hon. member's second question, there has been, of course, the general geological survey work, such as has been carried on in Canada for many years. This work has been done not only by the federal government but by many of the provincial governments, as well. All those geological reports are available. Iron ores of a very good grade indeed-I might say of a high grade, and in considerable quantities- are available about 130 miles west of Port Arthur. This is an ore similar in quality to that produced in the Duluth area. The total amount, however, is not yet known. It would require some years of exploration to ascertain that fact. A few years ago the development of a large body of low grade iron ore was undertaken in the Michipicoten area. A considerable amount of the iron and steel used at the "Soo" comes from that development. It may well be that there are other deposits of iron ore in Canada.
Here I would add that, certainly as a post-war work, this country should do a great deal more than it has done in the past-in my judgment, at any rate-by way of carrying out geological surveys and geological mapping. It has not always been easy to get the appropriations which those acquainted with the possibilities of this country thought were necessary. But I do say that I have great confidence in the future of mining developments in Canada. We may reasonably expect to find mineral-bearing rock all the way through this great preCambrian shield from Labrador, skirting northern Manitoba and northern Saskatchewan right through to the Arctic ocean. There are mines scattered all over that area and certainly, when the war is over, this development will be a means, not only of adding to the national wealth and providing employment but also to furnish all the benefits that come from such a development. Undoubtedly the possibilities are very great. One of the things needed for development is that as accurate knowledge as possible be secured from geological surveys and mapping.


Agar Rodney Adamson: There is just one suggestion I should like to make. This appropriation of $500,000 is wholly inadequate. More money should be spent on exploration for and development of strategic minerals. This
4958	COMMONS
War Appropriation-Mines and Resources
vote only goes to show how difficult it is to find and develop a mine. The minister will correct me if I am wrong, but I understand the procedure is that a prospector comes to the department with evidence of a certain deposit, shall we say of scheelite, cinnabar or one of the strategic base ores necessary for the development of required metals. The department will then decide to send an engineer or surveyor to inspect the deposit based upon geological maps or whatever is known already of the district. If the department decides to *go ahead and considers the deposit worthy of exploration, is it developed by the department, or does the department assist the prospector to develop it? How does the prospector develop it?
If an established mine, say in the Porcupine camp, finds, as many of them have there and in northwestern Quebec, that there is a deposit of scheelite in their property which is not normally workable, does the department agree to assist that mine in the development of the scheelite? Does it tell the mine to develop the scheelite, the department paying for the out-of-pocket expenses? Does the taxation department say that it will reimburse the mine for the expenditures or allow them to consider it as development work which would be deducted from their taxation? This development work is one of the most important things that can be carried out, both now and post-war.
Before the war we knew nothing about what we could do in the way of magnesium, in the way of the development of iron ore, the development of mercury or of many other metals. These metals are being developed to-day, although it is true that some are being developed on an uneconomical basis. We who are in the business believe that the production of these strategic metals will continue, that they will be a part of the Canadian economy from now on. That is why I say this sum of $500,000 is inadequate.
I do not think the committee realizes just how little we are doing in the way of geological surveys as compared with other countries.
I do not want to belittle the geological survey of Canada, because the work being done by Doctor Camsell is simply magnificent, but it is quite small when compared with what is done in other countries. Either the year immediately before the war or the year before that, the United Kingdom actually spent more on geological surveys than did Canada. We think of England as being a small country which has been prospected over quite a bit, but this fact shows the importance of the geological survey. When the story is finally 
written I think it will be shown how difficult it is to discover a mine. Considerable money has been spent on many prospects, but I do not know how many actual properties have been brought into production. I gathered from the minister's statement that it is not much more than one in a hundred.
I do not think we appreciate how difficult it is and the amount of money that must be expended in finding a mine and bringing it into production. This shows how wrong and how stupid it would be for the government to go into the mining business and develop mines as government property. The government should do everything it can to assist individuals in developing mines, so that every ton possible of useful ore is produced, but in my opinion the government has no business to go into the actual mining of metals and ores. As I say, this $500,000 is in my opinion a very small amount to be expended on the discovery and development of strategic metals during this war crisis. I should like to see the amount increased, but I hope the minister will state that it is not the policy of the government to go into the mining business and develop these things as government properties, except perhaps under extremely exceptional circumstances.


Thomas Alexander Crerar: I think it is well to keep in mind that the expenditure under this vote is necessitated by the needs of war. This expenditure does not, except perhaps indirectly, have a bearing on what might be described as the general development of mining in Canada. The united nations and Canada were short of certain strategic materials, and we sought to see what could be done in Canada to supplement these needs. Notwithstanding what the hon. member for Rosetown-Biggar (Mr. Coldwell) has said, I have entire confidence in the integrity of the metals controller.


Major James William Coldwell: I am not questioning his integrity.


Thomas Alexander Crerar: I do not think the metals controller has been doing chores for any person in connection with the work he has carried on. I think it is only fair to say that.


Major James William Coldwell: I was not referring to that.


Thomas Alexander Crerar: I quite understand that. The hon. member for York West inquired if assistance would be given to a prospector who might bring in a prospect. If, upon inquiry, it were found to have merit, we might decide to carry on diamond drilling, as has been done in other cases, but the prospector would not be reimbursed for any expenses which he might

War Appropriation-Mines and Resources
have incurred up to the time he had brought the matter to the attention of the government. In a few cases further exploratory work has been undertaken by the government in order not to pass over any possibility of adding to the store of these necessary metals.
As to the general question of the basis of mining development in the future, it will be the aim of the government to carry on the necessary services, geological and mapping, by the best men we can get, so that we may get as complete information as possible on the geology of the country, and then make that available to prospectors and developers and let them do the rest of the work. That at any rate is the basis upon which our mining development has been done in the past, and though it may change in the future, I am expressing my own view of what is the wisest course to pursue.


[Stage Direction]
Item agreed to.
Mines and geology branch-
To provide assistance to provincial governments in construction of transportation facilities into strategic mineral, including oil, properties, $200,000.
Douglas King Hazen: Can we have a break-down of this amount by provinces?
Mr. CRBRiAR: Does my hon. friend have in mind the projects under this vote?


Douglas King Hazen: Yes.


Thomas Alexander Crerar: I have the expenditures for last year. The amount made available from the war appropriation was $109,000. We spent approximately $41,000; and at the Jerome mine, $13,000, at Renabie, $11,000, and at the St. Anthony mine, $1,273.20. Then $25,000 was made available to assist in winter transportation.


Douglas King Hazen: In Ontario?


Thomas Alexander Crerar: None in Ontario. In Quebec we made available $3,100 in connection with three molybdenite properties, and $6,000 to improve transportation to the Mercury mines in northern British Columbia.


[Stage Direction]
Item agreed to.
Bureau of mines-
Construction of new metallurgical laboratory, $115,000.
John George Diefenbaker: Where is the new laboratory to be constructed, and when is the work to commence?


Thomas Alexander Crerar: It will be in Ottawa, on Booth street.


Manley Justin Edwards: Have we not a national research council? Do they not do metallurgical research? Is this a duplication of work carried on by the national research council? 72537-314


Thomas Alexander Crerar: No. Metallurgical research and the determining of the best method of treating ores is all worked out in our mines branch. There is no duplication of that work by the national research council.


Angus MacInnis: Is this to be a permanent
structure?


Thomas Alexander Crerar: Yes.


Angus MacInnis: Then how does it happen to be in the war appropriation?


Thomas Alexander Crerar: It probably would not have been undertaken at the present time if it had not been for the war.
The work of this bureau has had largely, if not wholly, to do with the war during the past few years, and in an ever-increasing way. I might indicate in a general way the kind of work that is done. For instance, we carry on tests to ascertain the resistance of certain types of armour protection. We are working not only for our own government but for the British mission here, and a good deal of the work is of a secret nature. The facilities they had were not sufficient to carry on their work effectively, and accordingly it was decided less than a year ago to put up an additional building. Owing to the severe winter the work did not progress as rapidly as had been intended. Funds were released from the war appropriation, and expenditures were made amounting to $40,000 before the end of the fiscal year. We need additional funds to complete the building.


[Stage Direction]
Item agreed to.
Metallic minerals division-
Services to war departments, $210,000.
John George Diefenbaker: What is the nature
of the services which the Department of Mines and Resources renders to the war departments?


Thomas Alexander Crerar: The branch does work for the Department of Munitions and Supply.


John George Diefenbaker: What, for instance?


Thomas Alexander Crerar: It carries on certain tests. For instance, tests are made in connection with motor vehicles for army purposes. Research work that Was done on vehicles moved by caterpillar treads effected a considerable saving; it is not a thing that we broadcast to the world. Work is also done for the United Kingdom and for different branches of the armed services related to various types of munitions and all that sort of thing. I can assure my hon. friend that it has been a valuable work.

4960	COMMONS
War Appropriation-Mines and Resources


John George Diefenbaker: Who looks after this? The national research council?


Thomas Alexander Crerar: No.


John George Diefenbaker: Well, why should this be allocated to the Department of Mines and Resources?


Thomas Alexander Crerar: Because it relates to the type of research work which has been carried on by the bureau of mines for many years. They had the trained skilled personnel to do this work.
In answer to the hon. member for Calgary West I mentioned a moment ago that certain research work having to do with the treatment of ores and with the matters relating to that has always been carried on in the bureau of mines. It was established in the bureau of mines before we had the national research council and has been carried on there since, and that work is not duplicated by the national research council. Consequently, when these needs arose, not only for our own services, but for work for the British government and for our munitions and supply department, it was carried on in the bureau of mines because there was in that bureau the personnel most experienced in that kind of work.


John George Diefenbaker: How many persons has the minister engaged in this work?


Thomas Alexander Crerar: I could not answer that
question accurately.


John George Diefenbaker: The expenditure
proposed is $290,000.


Thomas Alexander Crerar: That is paid for out of this vote. There is a vote in our ordinary estimates for the maintenance of the laboratory work and of the bureau of mines. That has been expanded to take care of this additional work that has been thrown on it, and I repeat what I said earlier, that I think practically all or almost all of the work that is being done by the bureau of mines and the laboratories associated with it is in connection with the war effort in one direction or another.


[Stage Direction]
Item agreed to.
Lands, parks and forests branch-
Bureau of Northwest Territories and Yukon affairs-	.
Expenses of liaison officers in connection with the Alcan and Canol projects, $10,000.
Grote Stirling: Will the minister set
his face against the further use of this word "Alcan"? There is a real name for the highway and it is a beautiful name-the Alaska highway. The public is resenting this word "Alcan" more and more, and I very much

regret to see it used in this official document and fathered by the Minister of Mines and Resources. What will the minister do about
it?


Thomas Alexander Crerar: I agree wholly with my hon. friend. I think "Alcan" is really an atrocious word. I give the assurance to my hon. friend that it shall not appear hereafter in the estimates of the department.


Grote Stirling: Splendid.


Thomas Alexander Crerar: I think "the Alaska highway" is a much more descriptive and accurate term.


[Stage Direction]
Item agreed to.
Dominion forest service-
Forest products laboratories, $34,435.
Angus MacInnis: Is this item for war purposes, or is it in addition to the item in the general estimates of $145,717?


Thomas Alexander Crerar: We have a vote in the general estimates. This is for war purposes. It has to do as I recall, with the testing and development of plywoods used in the manufacture of aircraft, glues, and testing these when they are made, and generally testing fibreboard, compregnated wood and other wood products such as munitions containers and that sort of thing. The total amount estimated for this year is $34,435. The amount released last year under the same vote was $31,395, and out of that $27,079 was spent.


[Stage Direction]
Item agreed to.
Dominion forest service-
Alternative service work camps, $79,000.
John George Diefenbaker: This item and the next item might be considered at the same time.


Joseph-Arthur Bradette: Perhaps we might take the two items together.


John George Diefenbaker: Very well.
National parks bureau-
Alternative service work camps, $500,000.


John George Diefenbaker: These two items are, in my opinion, unjustifiable. Last year, according to the auditor general's last report, there was expended for alternative service work camps the sum of $235,463, in connection with the detention of groups eligible for military service and known as conscientious objectors.


Thomas Alexander Crerar: That was for the year ended March 31, 1942?

War Appropriation-Mines and Resources


John George Diefenbaker: Yes. Expenditures charged were as follows:
Banff park	
$51,820	57Cape Breton Highlands park____	28	85Jasper park	
46,193	00Kootenay	
16,939	00Prince Albert park	
50,711	00Riding Mountain park	
63,564	00The expenditure on salaries and wages was $131,233; printing and stationery, $1,344; travelling expenses, $2,369; supplies and materials, $91,607; sundries, $8,908. In addition to that, there was an allotment for alternative service work camps in the dominion forest service of $12,848, of which $10,858 was expended.	.
I can see no justification whatever for the expenditure of this money in utilizing the services of conscientious objectors. These men are paid fifty cents a day and remain in these various camps at work for a period, generally speaking, not exceeding three months. At a time when there is a shortage of man-power which has been so frequently referred to, in connection with the production of firewood, pulpwood, and for farm labour, I think there is no justification for the utilization of the services of these men in the national parks, particularly when this vote is considered as a war expenditure. Conscientious objectors should be permitted to serve in some service other than active war participation; as to that there can be no argument. But as far as the work being done in the national parks is concerned, it is a use of man-power for purposes unconnected with the war effort, and, I submit is an unjustifiable waste of man-power when regard is had to the needs and requirements of manpower in more necessary kinds of work. I cannot understand the justification for increasing the expenditure this year by approximately $250,000. Only recently in Saskatoon some seventy-five Doukhobors came before the national selective service board. They were allowed to work on their own farms; yet, with the imperative need of mobilization of our man-power, many of these people serve in connection with work in national parks. Their services could be used in agriculture. According to the statistics given in "Canadian Affairs", to which I referred the other evening, there are 3,401 in this country. An amount of $500,000 seems like a terrific expenditure to make for a matter of a few months' alternative service in parks. I move that this amount be reduced to one dollar.


Mr. ROSS (Souris):: I should like to say a word endorsing what the hon. member for Lake Centre has said and at the same time
72537-314J
to ask some questions in regard to the item. I cannot see any reason for this amount being expended at the present time. Last night we listened to the Minister of Trade and Commerce as he pointed out that we had 30,000,000 bushels of grain standing in cars on the tracks which could not be loaded into terminal elevators because we were short of man-power at this particular time. We have had radio broadcasts and what-not with regard to the shortage of fuel for next year, and municipal officials pointed out to the government, last fall and in the winter, that wood camps should be set up for the purpose of providing fuel for the coming winter. There is certainly plenty of all-year-round work to do now which would be of greater advantage to the nation as a whole than this proposed expenditure of public money. It is essential work that is required if the people are not to freeze this winter. In the fall we shall have to store grain, which is vital for feed, because the transport system is tied up as a result of the falling down of the selective service in that respect. I suggest that we should not waste this amount of money with the man-power muddle right on our doorstep at the present time.
I believe the government received communications last fall, in December and since then, from provincial and municipal organizations, pointing out that lands should no,t be sold to conscientious objectors at this time, but that they should be held until after the war for our veterans. So far I have not heard any answer from the government in that regard, and this might be a proper item under which to ask the minister what the stand of the government is in this respect. In his province and my native province the department of mines have intimated that they will not sell land to anyone until the war is over, so that the returned soldier shall have the first option on any lands they hold. We should have a statement from the minister as to the policy of the government in this matter. In all seriousness I suggest that we should consider eliminating this item, because it is a waste of public money and involves a waste of man-power which is so essential in other callings at the present time, in the national interest, if we are to obviate a great deal of suffering in the coming year.


Thomas Alexander Crerar: The hon. member for Lake Centre spoke, I believe, without that reflection which he usually gives to his observations. He based his criticism wholly on expenditures that had been incurred prior to fifteen months ago, indeed, incurred over two years ago. The figures he read from the auditor general's
4962	COMMONS
War Appropriation-Mines and Resources
report were figures that appeared in the report tabled this year, but for the year ending March 31, 1942.


John George Diefenbaker: That is what I said.


Thomas Alexander Crerar: The situation two years ago in respect of man-power was vastly different from what it is to-day. My hon. friend knows that, as does every other hon. member in the house; and the problem when these men were called up was to find employment for them. At that time the national parks constituted one place where they could be employed and they rendered excellent service. They did very good work in the national parks. The situation has now changed altogether. I have stated in regard to other votes that they were estimates, and so is this vote an estimate of what might be required for this purpose in the present fiscal year. That estimate was prepared nearly seven or eight months ago and was ready for parliament when it met in January. Now, I repeat, the situation has changed, and I can tell the committee that there will not be anything like that amount of expenditure involved for the conscientious objectors in the present year.


John George Diefenbaker: How many conscientious objectors does the minister expect will work in the parks this year?


Thomas Alexander Crerar: At May 31, there were 190 conscientious objectors working in the national parks, and on June 12 there were seventy-six in forest experimental stations. What were they doing? They were employed largely in Alberta to cut pit-props which are necessary in coal mining in that province. That is work which everyone will agree has to be done, because if you are to mine coal you must have pit-props. These men were engaged also in some parks cutting lumber and cordwood. So that if my hon. friend persists in the motion, which would have to be voted down, we would interfere at once with the production of necessary pit-props for the mining of coal, and we would cut down substantially the quantity of cordwood that is now being cut by these conscientious objectors and which is necessary to meet the fuel shortage next winter. I would ask my hon. friend, on reflection, to withdraw the amendment to the motion.
What I have said is, I believe, a partial answer to the hon. member for Souris. There is one point, however, with which I wish to deal that touches on his remarks. I refer to his statements regarding the sale of lands to conscientious objectors in the various provinces. The sale of land comes wholly within the jurisdiction of the provinces. It

may be that under the War Measures Act-it would be stretching it to a very great degree, as I think hon. members will agree-it might be possible to take some action federally, but it would be a pure invasion in a matter which it is solely the right of the provinces to deal with, and I think it would be resented by the provinces.


James Arthur Ross: Not entirely, if the federal government owned land.


Thomas Alexander Crerar: We are not selling any federal lands. If my hon. friend will give me one instance-


James Arthur Ross: That is what I am asking.


Thomas Alexander Crerar: There have not been any such sales. Why does not my hon. friend ask if there are instances?


James Arthur Ross: The policy is what I want to know.


Thomas Alexander Crerar: He rises and makes a statement that can only be regarded as a criticism of the government because we have not done something in this matter.


James Arthur Ross: I did not make any such statement; I asked the direct question. What was the policy of the government?


Thomas Alexander Crerar: Very well, then; I will say this, that as far as the federal government's policy is concerned, it has no lands to dispose of excepting certain crown lands, and I am sure none are being sold to conscientious objectors. I think those are all the lands it has, unless we go away up into the north-west territories, where conscientious objectors do not wish to settle.


James Arthur Ross: There are other lands which I cannot discuss under this item, but which come under the same minister. I refer to soldier settler lands, and there surely would be a policy covering all the lands owned by the federal government.


Thomas Alexander Crerar: I do not think any soldier settlement lands have been sold to conscientious objectors.


James Arthur Ross: I am asking the
question.


Thomas Alexander Crerar: As far as my knowledge
goes, not a single foot of any land under the control of the federal government has been sold or disposed of to conscientious objectors; I am sure I am correct in that statement.
I think that covers the points I wished to mention, but let me tell the hon. member for Lake Centre once more that there are no more of these conscientious objectors working

War Appropriation-Mines and Resources
in the parks or in forest stations than are able to do useful work, either by way of providing wood fuel or producing pit^props to be used in the operation of our coal mines.


James Arthur Ross: I asked if these men could not be employed almost all year, cutting wood in the winter months and doing agricultural work in the summer, and perhaps in unloading grain at the terminals and work of that kind. It would not cost the government anything more to keep them employed the year round.


Thomas Alexander Crerar: I think that disposition is being made of them. I believe I am correct in saying that, many of these conscientious objectors are now placed in farm work across Canada. I have not the exact figures in regard to placements in that connection, but I know they have been so placed. I think some of them are working in the coal mines of Alberta. At any rate their labour is not being utilized in the national parks or in forest stations except in the manner I mentioned' a moment ago, and I gave the number engaged in that work.


John George Diefenbaker: What is the anticipated expenditure this year? The estimate is half a million dollars, but what is the anticipated expenditure?


Thomas Alexander Crerar: That will depend on how long the men stay in this work. For instance, it may be that the number of men in the parks will be reduced, particularly at harvest time. I think they have been cutting wood almost up to the present time and certainly up to the date mentioned here, May 31, but that work is probably over now. I am not sure, but I do not believe there is much good in cutting green cordwood in the month of September, for instance, if that wood is to be consumed in the months of October or November. In that case, however, the men will be moved to some other useful employment. The point I wish to make is that they have been employed in a very useful and necessary part of our general economy, and they are not now employed in the parks or in the forest stations except in the work I have mentioned, and forest conservation and protection.


John George Diefenbaker: How many were employed in the parks during the past year? What was the maximum number?


Thomas Alexander Crerar: I have not those figures, but I said that as of May 31 the total employed in all the national parks of Canada was 190, and seventy-six in the forest stations.


John George Diefenbaker: How many were
there a year ago?


Thomas Alexander Crerar: I have not these figures, but I should say the number was substantially larger. I am advised that there were probably about 400, but I would not wish that figure to be taken as final because I have not that data here.


Mr. QUELCH:: Did I understand the minister to say that the prohibition of sales of land to certain classes of people was purely a provincial matter?


Thomas Alexander Crerar: Yes; the disposition of land, the sale of land as between two individuals, is a matter of property and civil rights that comes within the control of the provinces, and the federal government has no jurisdiction.


Victor Quelch: Then will the minister explain why the federal government disallowed the Alberta bill which would have prohibited the sale of land to the Hutterites?


Thomas Alexander Crerar: I do not know that I understand my hon. friend's question.


Victor Quelch: Some time ago the Alberta government passed a bill which would have prohibited the sale of land to certain classes of people, I think particularly the Hutterites, and the federal government disallowed that bill. Now the minister says that is purely a provincial matter.


Joseph-Arthur Bradette: Order. The discussion is on the amendment which has been moved by the hon. member for Lake Centre, to reduce the amount of the estimate to one dollar.


Victor Quelch: But I am referring to the statement made by the minister on this amendment; I am trying to get a clarification of that statement. The minister said it was purely a matter for the provincial government if it wanted to prohibit the sale of land to certain classes of people; yet when the province of Alberta passed a bill doing that very thing the federal government disallowed it. and I am wondering why.


Thomas Alexander Crerar: At the moment I am unable to give my hon. friend the reasons why that particular legislation was disallowed. That is a matter for the Minister of Justice.


Victor Quelch: The Minister of Justice is in his seat; perhaps he could clarify the situation.
Mr. ST. LAURENT: I should not like to give from memory the report that was prepared which necessitated the disallowance of that legislation. It was tabled here at the time, and then a summary of it was tabled this week, not more than two or three days ago, in the list of all legislation disallowed since 1920.
4964	COMMONS
War Appropriation-Mines and Resources
Without attempting to be exhaustive at all, I may say that one reason why it was disallowed, and the main reason, was because it was contrary to the express declaration of the defence of Canada regulations. It was not legislation dealing with the Hutterites only; it was legislation dealing with enemy aliens, and was contrary to the positive declaration in the defence of Canada regulations that enemy aliens who registered and who conformed with the formalities prescribed by those regulations, would not be interfered with. This was provincial legislation which ran counter to the formal declaration in the defence of Canada regulations.


Victor Quelch: That being the case, the statement made by the Minister of Mines and Resources was not correct, and this is not a matter entirely under the control of the provincial government.
Mr. ST. LAURENT: No; the hon. member is putting an entirely erroneous construction on what I have said. The general principle is that property and civil rights are within the jurisdiction of the provincial legislatures, but in war time it is felt by the Department of Justice that under property and civil rights the provinces must not be allowed to nullify war measures adopted by the federal authorities.


Victor Quelch: I quite agree, but the matters we are discussing now are in relation to the war. We are not talking about after the war; the matter we have raised at the present time is in connection with the war, and the minister's statement was in relation to the war.


Joseph-Arthur Bradette: Shall the amendment
carry?


Some hon. MEMBERS:: Eleven o'clock.


Joseph-Arthur Bradette: Those in favour will kindly say, aye.


Some hon. MEMBERS:: Aye.


Joseph-Arthur Bradette: Those opposed will kindly say, no.


Some hon. MEMBERS:: No.


Joseph-Arthur Bradette: In my opinion the amendment is lost.


Thomas Miller Bell: Mr. Chairman, it was eleven o'clock before you put the vote.


Some hon. MEMBERS:: No.


Joseph-Arthur Bradette: Shall I report progress?
Progress reported.
It being three minutes after eleven o'clock, the house adjourned, without question put, pursuant to standing order.

Saturday, July 17, 1943