NATIONAL WAR LABOUR BOARD


[Stage Direction]
On the orders of the day:
Mr. GORDON GRAYDON (Leader of the Opposition):: Mr. Speaker, items appearing in certain newspapers indicate that the government has under consideration an enlargement of the membership of the national war labour board. Is the Prime Minister in a position to make any announcement to the house with respect to these additional memberships?

Selective Service


Right Hon. W. L. MACKENZIE KING (Prime Minister):: I am not in a position to make any statement at the present time.


Gordon Graydon: Does the Prime Minister expect to be able to make a statement shortly ?


William Lyon Mackenzie King: I was asked a similar question some days ago and I replied that I had made "a very full statement in the house with respect to the organization of the board, and if there are to be any changes or additions the house will be informed in due course." I am afraid I cannot go beyond that at the present time.



SELECTIVE SERVICE


[Stage Direction]
On the orders of the day:
Gordon Graydon: The press to-day carries the
announcement of the Minister of Labour that the national selective service advisory board has been reconstituted by order in council. The board appears to have a membership of some nineteen persons, but there seems to be only one representative of agriculture and one representative of war veterans. Will the minister explain why these two important sections of our people are not more fully represented on the board in relation to others?


Hon. HUMPHREY MITCHELL (Minister of Labour):: My hon. friend is correct in
saying that there are nineteen members of the advisory committee of the national selective service. I think he will agree with me that the soundest thing to do in setting up such a committee is to keep it as small as possible, having due regard to the interests that should be represented. That, by the very nature of things, when you are dealing with man-power, involves government departments. If the hon. gentleman reads the order in council he will find that the Department of Agriculture is represented, the deputy minister being on that committee, and that defence, finance, and the prices board, are also represented, because they necessarily come into the picture. What we try to do is to get a broad crystallization of opinion, representing what may be called the dominant vocations and interests of the country. Practically all of these are represented - the construction industry, the railroads, industry in general, general stores, the big departmental stores, and the banks, also, as my hon. friend says, the organized veterans. The veterans did not
ask for representation, but we felt that they should be represented. If you go through the list you will find among the representatives of other callings many ex-service men of the last war. What we have tried to do, and I believe the soundness of our position will be apparent if it is examined, is to get as broad an opinion as possible in an advisory capacity on the question of man-power.


Gordon Graydon: One of the great industries which is suffering with respect to lack of man-power is agriculture. The minister may be right when he says that the deputy minister of agriculture is one of the nominees I see here the name of Doctor Barton-but he is grouped with a number of government employees who are working together in regard to this matter. The minister should give further consideration to the appointment on behalf of agriculture of another representative with practical experience. It seems to me that one representative only of agriculture is an underestimate of the situation in respect of agriculture and man-power at the present time.


Humphrey Mitchell: Doctor Barton has a
wealth of practical advice behind him. My hon. friend's complaint is not fair. Coming as my hon. friend does from a partly rural constituency he knows Doctor Barton has expert advice in his own department and opportunity to obtain advice on every matter that may come up affecting agriculture. With respect to the appointment of a representative of agriculture, of course we went to the agricultural organizations for that nomination.


Mr. ROSS (Souris):: Will the minister
consider immediately the appointment of a representative of western agriculture? The only practical agricultural representative on the board is from the province of Quebec. Following what my leader (Mr. Graydon) has said, it seems to me that western agriculture should be represented by a practical representative. Labour has five representatives.


Humphrey Mitchell: I think my hon. friend
will agree that twenty-three members is a large number for an advisory council. What we have endeavoured to do is to go to the national organizations. It so happens that the farmers' organization that was consulted was a national organization, and they made that appointment. If all these industries were given representation on a reasonable basis you would probably have an advisory council bigger than this House of Commons, which would make its functioning almost impossible.
Royal Canadian Navy



MILITARY SERVICE


[Stage Direction]
On the orders of the day:
Mr. J. G. DIEFENBAKER (Lake Centre):: I should like to address a question to the Minister of Labour. In a news service issued to-day the following appears:
Task of tracing evaders is to be carried on by Associated Credit Bureaus of Canada Limited, an organization with some fifty-eight offices across the country.
Has any arrangement been made under which Associated Credit Bureaus are to be connected in any way with the location of defaulters?


Humphrey Mitchell: Might I ask my hon. friend a
question first? Would he give me the source of his information?


John George Diefenbaker: \es; it is a weekly news letter.


Humphrey Mitchell: I should like to have
the name of the source of information, I think that is a fair question.


John George Diefenbaker: Surely, if it will
help the minister. It is "Trend." Now, what is the answer?


Humphrey Mitchell: My friend should take
it in the light of whence it comes. There is no truth in the statement printed in "Trend."



AIR TRANSPORT


[Stage Direction]
the Royal Canadian Air Force are applying to privately owned air transportation companies for positions after the war, would the government undertake at an early day to announce its policy in regard to post-war civil air transportation?
Mr. SPEAKER:: I have allowed the hon. member to state his question and read the information on which he bases it, which was rather long. It certainly is a question which should be placed upon the order paper. The hon. gentleman has asked for a declaration of policy. In this connection I should like hon. members to observe the rulings I have already given in regard to asking such questions on the orders of the day. Such questions must conform to the rules of the house as they have been laid down and practised from year to year.



ROYAL CANADIAN NAVY


[Stage Direction]
On the orders of the day:
Mr. D. K. HAZEN (St. John-Albert):: I should like to address a question to the Minister of National Defence for Naval Services (Mr. Macdonald). It arises out of an article that appeared in the Telegraph-Journal of Saint John, New Brunswick, on March 9 last, This article reported that Saint John is to lose the Royal Canadian Volunteer Reserve training centre that has been established there for about two decades and is now known as His Majesty's Ship-


Some hon. MEMBERS:: Order.
On the orders of the day:


Mr. H. R. JACKMAN (Rosedale):: I should like to ask the government a question based on an item in to-day's Globe and Mail:
Sweden To Take Hand in Broad After-War Air Route Expansion
Stockholm, March 11.-A new Swedish company, known for short as Sila, has been formed to develop Sweden's intercontinental air routes after the war

especially those to the United otates. Backed by Swedish shipping companies, industries and banks, a minimum capital of
30,000,000 kroner (about $7,500,000 at par) has been guaranteed. Agreement has been reached between Sila and the existing government-owned Aero Transport which was organized in 1924. Before the war Aero Transport had air routes in Scandinavia as well as to European points. Sila's aim is to build up intercontinental sir traffic in collaboration with Aero Transport which has put its technical organization and experienced management at Sila's disposal.
In view of the importance of air transportation and the fact that many of our men in


Thomas Vien: Order. I have listened to the hon. gentleman's question and I think I know what it contains. I suggest that it should be placed upon the order paper.
Mr. GORDON GRA^DON (Leader of the Opposition): I think, Mr. Speaker, you are taking a pretty severe attitude-


Some hon. MEMBERS:: Order.


Gordon Graydon: After all we have not asked very many questions before the orders of the day are called. I think they are all on matters of urgent importance, at least in the minds of the hon. members who ask them. I would ask you, sir, to grant at least a little more latitude and leniency in reference to the few questions that are being asked from time to time.


Thomas Vien: The question asked by the hon. member deals, as I understood, with the closing of a naval establishment. That surely

The Budget-Mr. Gray
is a matter not requiring an immediate answer, and certainly such an answer could not be given by the minister without some consultation with his advisers. It is a question which I think ought to be placed on the order paper. When matters are of immediate urgency and a reply is necessary because otherwise the incident to which the question relates would evaporate over a period of forty-eight hours and hon. members wish to know what the position of the government is in regard to such matters, I think it is proper to ask such questions on the orders of the day. But when hon. members ask questions which must necessarily be referred to the departments in order that a reply may be given, the position is different. I have every desire to give as wide latitude as possible to hon. members; nevertheless I am bound by the rules, and therefore I must ask that these questions be considered in the light I have indicated and be placed on the order paper.



THE BUDGET


[Stage Direction]
The house resumed from Thursday, March 11, consideration of the motion of Hon. J. L. Ilsley (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Blackmore, and the amendment to the amendment of Mr. Coldwell.
Mr. ROSS W. GRAY (Lambton West): Mr. Speaker, reading the speeches that have been delivered by hon. members this session one is struck by the fact that up to the present- and we have now been in session for some six weeks-in the main the speeches have been devoted to the new and very broad subjects of social security and post-war reconstruction, while man-power, the most important subject of all, has been given scant attention. I do not suggest that the problems of social security and post-war reconstruction are not important, but I do say that a committee is the proper place for their study, before we become too enthusiastic in our attempts to outdo each other and thus forget that almost everything in connection with the winning of this war still remains to be done.
I do not propose to discuss the financial side of the budget, except to say that I join with others in this house in congratulating the Minister of Finance (Mr. Ilsley) upon being able to present to a nation of eleven and a half million people these astounding figures of revenue and expenditure for the present and the coming fiscal year. I said I did not propose to discuss the financial side of the budget, but any full discussion of the man-power
problems of this country would entail an investigation into the ability of the man-power of Canada to raise more revenue, and a further survey of the allotment of such man-power and the money required to maintain it either in production or on the firing line. Speaking from my place in this chamber last year I urged the government then and there to bring into operation a compulsory selective service unrestricted by geographical limits with regard to the army, combined with a scientific allocation of the man-power of this country as-between industry, agriculture and the armed forces. I have never had occasion to change that opinion; in fact as the months went by and we witnessed the terrific toll of casualties at Dieppe, I am sure more than one of us stopped to consider gravely whether or not we had sufficient trained volunteers should this be the beginning of the real drive against Hitler. In those intervening months we have witnessed labour disputes and strikes of major proportions; we have watched the farms losing their man-power, while louder and louder became the cry for still more production.
Let us for a moment consider where our failure to adopt an all-out selective service, applied to all alike, has led us with respect to farming. Hon. members may ask what a lawyer knows about farming. I know very little about it, I admit, but I do know a great deal about the man-power distress of the farmers of western Ontario, particularly of those of my own riding, and it is concerning that distress that I now propose to speak. Let us review the situation. Under order in council P.C. 2252, dated March 21, 1942, all persons who on the 23rd day of March, 1942, were wholly or mainly engaged in agriculture were to be granted a postponement order until further notice. But what happened? The divisional registrars under the war services department continued to send out notices, either of their own accord or on instructions; and knowing the very fine and fair registrar we have in our district, Mr. W. A. Martin, I must take it that this was done upon instructions. I want to give this house an exact copy of a notice, leaving out only the name and the call number. It is as follows:
Department of National War Services, London, Ontario, September 21, 1942. To . . . Call Number . . .
Dear Sir:
Kindly be advised that the commencement of your further training period has been deferred until approximately December 31st, 1942, A notice to report specifying the date and military training centre will be forwarded to you in due course.
Yours truly,
The Budget-Mr. Gray
[Stage Direction]
Is there anything indefinite about the date of postponement? Is there anything indefinite about what is to be expected at the expiration of the three months' period? Is there anything in that notice suggesting to this young farmer that at the end of that period he has a right to apply for a further postponement? There is not a word to that effect. That young man as others like him did, believed that on the expiration of that period he was headed for the army. What was the result? Sell the stock; sell the farm; leave the father alone. There appeared to be no option. Thus we continued the back door method of obtaining so-called volunteers for the army.
About the same time there appeared another form of notice, differing only in its length. Shortly after-and all within one month-there appeared still another form, this time containing a clause advising the applicant that any further request for postponement should reach the registrar about thirty days before the expiration date. So that within one month three different forms of notices were sent out to different farmers. Is it any wonder there was confusion? Is it any wonder that these notices led to uncertainty and unrest, and, in my opinion, definitely hampered production? What about the fall work? What about the purchasing of winter stock? What about the renewing of fall leases? These were the matters that disturbed the farmers of western Ontario, and no doubt farmers elsewhere.
When this matter was called to the attention of the then Minister of National War Services in October, 1942, I received in reply a long-winded press release issued by the former minister in April of 1942; only that and nothing more. In all fairness to the Minister of Labour (Mr. Mitchell), who these days is receiving more brickbats than bouquets, I am bound to say that since national war services came under his department the form of notice has improved, and in my district at least applicants are given a term of postponement sufficiently definite to enable them to complete one full season's work.
That, however, is only one phase of the farm man-power problem. Men are still being encouraged to leave the farm and join the army; and are doing so, I am afraid, without any definite policy on the part of the Department of Labour in regard to remedying the situation. Read the nine points with regard to farm labour presented to this house on February 26. All through that memorandum you will find the word "will", not the "will" denoting determination but the "will" signifying future consideration. I cannot do more in connection with this phase of the man-power tMr. Gray.]
problem than reiterate that it is not a matter for surveys; it is a matter for action now. Let me repeat that until you have in Canada an over-all' compulsory selective service, you cannot properly assign men and women to their tasks and thus bring about a measure of total war.
I come now to deal with man-power and labour, and I make this assertion. Until we are prepared to put into effect unrestricted compulsory service we shall have labour unwilling or refusing to move from one industry to another; we shall have delays in industrial war construction, and we might just as well face the fact that we shall continue to have absenteeism, which is all too prevalent to-day. Make no mistake about this; too many men and women are staying away from vital war jobs. We cannot quarrel with the man or the woman who stays away from his or her work by reason of sickness or accident. Nothing less should keep one from his job. Nothing else would suffice on the parade ground or on the firing line. I know that this is a subject matter which is giving much concern to the Minister of Munitions and Supply and the Minister of Labour, and I simply call attention to the fact that as matters now stand national selective service officers are without power to deal with a situation which, to put it in its mildest terms, is deplorable. I would further urge that there be repeated checks made by the Department of Labour in industry and on construction in order to stamp out as far as possible the draft evasion all too prevalent at this time.
Turning finally to man-power and the armed forces, I believe with those who have declared that in a free society the obligations and privileges of military training should be shared generally in accordance with a fair and just system of selective compulsory training, and that such service should be without geographical restriction.
I anticipate that the house may be told we are obtaining sufficient men for the army through the volunteer method. I ask this question: How can we say that we have sufficient man-power enlisting when our soldiers have met only one real test, Dieppe? Last year I gave some figures of battle casualties suffered by Canadians in world war No. 1. On the Somme, in round figures the Canadians suffered 23,000 casualties; at Vimy, 13,000; at Passchendaele, 24,000; and at Dieppe, according to reports, we lost some 67 per cent of our effectives. Before we say we have sufficient men we would do well once again to pause and study these figures. It is imperative that we should have trained and equipped

The Budget-Mr. Fraser (Peterborough)
for service anywhere a sufficient number of men to support the Canadian corps in any emergency. It is only by being ready to take that stand in the house that those of us who were members of parliament when war clouds were gathering, and did not prepare, can in part atone for the great responsibilities which lie upon our shoulders.
I listened a short time ago to the hon. member for Weybum (Mr. Douglas) asking for an investigation into the attack made by the Canadians against Dieppe. I do not for a moment doubt the hon. member's sincerity, but as I listened to him talk glibly on military matters I could not help recalling that not very long ago the party in which the hon. member is one of the chief lieutenants was opposed to sending any men from Canada for military service overseas. I am prepared to assume my share of responsibility for having failed to urge greater preparedness. I have a right, therefore, to place on the shoulders of the Cooperative Commonwealth Federation a part of the responsibility for the failure to have at the very outbreak of this war an unrestricted selective service programme. Why do I say that? For the reason that I read from page 55 of Hansard for the war session of 1939 this declaration of policy by the present leader of the Cooperative Commonwealth Federation:
In view of these considerations, the Cooperative Commonwealth Federation believes that Canada's policy should be based first on the fundamental national interests of the Canadian people, as well as on their interest in the outcome of war. Canada should be prepared to defend her own shores, but her assistance overseas should be limited to economic aid and must not include conscription of man-power or the sending of any expeditionary force.
I repeat the words, "and must not include conscription of man-power or the sending of any expeditionary force." That sentiment is unfortunately not confined to the Cooperative Commonwealth Federation. There are adherents on this side of the house. And, apart from the former leader of the opposition, the hon. member for York-Sunbury (Mr. Hanson), who has remained true to his convictions, I am bound to say that in their zeal for a new leader, a new name, and a new platform, the man-power issue has become a good deal more cloudy on the opposition side than it was last year under the leadership of the hon. member.
Be that as it may, I speak to-day with sincerity and from personal observation. I rejoice with others in what Canada has accomplished. I regret with others that there is not an equality of sacrifice among us. In this respect I make no exception of the member of
parliament; and yet there is not a member of this house who is not prepared to do more, provided that he is given direction. Members are helpless without it. They would be included in any all-embracing plan.
The crucial months, Mr. Speaker, are at hand. Can we say that we are ready? Are we to continue to sidestep this issue until we are in an emergency? Time has been on our side; it has been good to us. But soon the starter's gun will be raised. The men are on their marks. Are we ready to take the baton at the end of the first lap? Are we ready to take it at the end of the second lap? Are we ready to marshal our forces and to carry it over the finish line? That is the question which must be faced, not in the heat of battle but now, before it is too late.
Mr. G. K. FRASER (Peterborough West):: 
An hon. MEMBER:: You must mean
farmers.


Gordon Knapman Fraser: I
mean not only farmers, but those who are engaged in business and drawing salaries. These men are working long hours in order to do away with Schickelgruber as soon as possible. They are working extra hours for that purpose but they are not allowed to have their salaries raised. But men working for the government are allowed to have their salaries raised. One commissioner had his salary raised from $6,600 to $10,000. It does not matter whether that commissioner is doing extra work or not, because these other men are also doing extra work, perhaps more work than this commissioner, but the commissioner happens to be paid' with the taxpayers' money and so perhaps the government feels that is all right. Perhaps they feel that the taxpayers' money can go out in any way. The man I refer to is John Grierson, and he gets a big salary too. I have here a newspaper clipping about his salary increase:
Film commissioner John Grierson has come in for a whacking salary boost, from $6,600 to $10,000.


Mr. MARTIN:: He got an additional job.


Gordon Knapman Fraser: Yes,
and throughout this country there are thousands of men doing additional jobs and working fourteen and sixteen hours a day, and doing more work than this man is doing. But they are not allowed to have their salaries raised five cents. In the other case, though, it is the taxpayers' money that is being spent; therefore the difference. I know men handling their own business who are not allowed to take one extra cent out of their own till, although they might be doing twenty times more business this year than they did in
1940.


Mr. ILSLEY:: That is true of civil servants unless they are promoted. They get no increase in pay unless there is a bona fide and true promotion.


Mr. HANSON (York-Sunbuiy):: And they
get a cost-of-living bonus if they are in the lower brackets.


James Lorimer Ilsley: So do employees of private industry.


Gordon Knapman Fraser: This
is only one commissioner. It is likely that a lot of other commissioners are in the same boat. This man evidently is a civil servant. There is something wrong here, and I feel that it should be corrected.
1210	COMMONS
The Budget-Mr. Fraser (Peterborough)
There are many phases of the budget with which I do not agree, but which I can take up when we are in committee of ways and means.
I wish to say a word or two about women and girls who are working in different war plants. Many of these girls started to work last August or during the summer months. They do not understand at all the income tax set-up. All they know is that money is being taken out of their wages every week; they do not know what for. There are many women and girls in munitions plants receiving the cost of living bonus who believe the government is giving it to them, not the employer. I know that is a fact. That may be Liberal propaganda; I am not sure. These girls did . not make $660 last year, 1942, and they have to wait for a year for a refund of excess income tax deducted from their wages. This year they will have to pay the additional income tax, and it is going to be mighty hard on them. I think the government should send to every wage earner a form showing how these deductions are made and how the employees can get a refund. I have mentioned in the house before that one girl had waited eleven months and had not yet received a refund, and she needed it because she was in the hospital. There are others in the same position.
The Minister of Finance in his budget speech tried to make the taxpayers throughout Canada believe that he was handing out a lollypop to everyone when he said that half the 1942 income tax would be forgiven. That is all right as far as earned income goes. Investment income is exempt up to S3,000, and that is all right. But take the case of a man who in 1942 had a fairly large investment income. Under the proposal of the Minister of Finance, half of his 1942 income tax liability has to be paid out of his estate when he dies. He might die in 1945 or 1950, and then, instead of having any capital, he might have only a small income. His estate would be burdened with the payment of half his 1942 income tax liability, and succession duties, which of course would not amount to much if the estate dwindled; but you would have current taxes, and in many cases the widow would have this ball of 1942 taxes around her neck, and would be left holding the bag and perhaps have to go on charity.


James Lorimer Ilsley: Oh, no.


Gordon Knapman Fraser: I know that is right; for it does not follow, because your income was so much last year, that it will be the same next year or the following year. Your income last year might be $10,000,

but in 1945 it might fall to SI ,000, making it impossible for you to pay your income tax of 1942, or even half of it.


James Lorimer Ilsley: It is investment income,
though.


Gordon Knapman Fraser: I
know; but we have had slumps before and we shall have them again. Investments might be entirely wiped out. I know of properties for which $10,000 could have been obtained ten years ago which the owners would be glad to sell to-day for $2,000. Twenty years ago that property might have been bringing in an income of a thousand dollars a year; to-day it may bring in only a hundred dollars, or not enough to pay taxes. So that deferring the half of the investment income until a man dies is not handing the taxpayer anything; it is just that much worse for the widow. In this regard, if the minister does not intend to clean the claim off the books, I think he should make arrangements whereby the taxpayer can pay it off during this year or next year, at a time when the government needs the money. It might be paid either in a lump sum or in small instalments. Under some such plan, which I believe is feasible, the taxpayer might be able to furnish the money, although I have some doubts. At any rate it would not hurt to try it. The minister should give a discount for payment of that income tax, and it could be worked out on the expectancy of life principle as used by insurance companies.


James Lorimer Ilsley: I will try to meet the hon. member on that.


Gordon Knapman Fraser: I thank the minister.


Mr. HANSON (York-Sunbury):: It would be far better if the minister would forgive it.


Gordon Knapman Fraser: The reason I believe there is no more than a chance of a taxpayer being able to pay it is that this year, operating on the quarterly plan basis, he had to meet his taxes on January 15. He then paid one-quarter of the 1942 taxes, which brought his payments on last year's taxes to one-half. But on March 31 he has to pay twenty per cent of the 1943 taxes, on June 30, twenty-five per cent, on September 30, twenty-five per cent, and on December 31, a few days after Christmas, thirty per cent of the 1943 taxes is loaded upon him. In other words the Minister of Finance says, "Look, taxpayer, I want taxes; whether there are toys for your child or not is up to you, but I want the money first." And he will get it, there is no doubt about that. The taxpayer

The Budget-Mr. Fraser (Peterborough)
this year is paying, therefore, 125 per cent, or a year and a quarter's income tax. That is the way I figure it out; I may be wrong, but I do not think so.
I have spoken about the working man and the working girl and the effects upon them of this income tax. I know of young people of both sexes who have taken jobs in munitions plants. They moved from their homes so as to be near their place of work, and figured that they were going to have so much to spend; they were told they would have so much. But when they got their pay envelopes they found there were deductions for this, that and the next thing, and on top of that came this income tax. I have a letter to-day on this matter. In one boarding house which has only four bedrooms there are sixteen boarders, or four people to a bedroom. They are sleeping in shifts; that is why they call it "shift sleeping". The reason they are doing it is not that they like to do it, but that it is the cheapest way, and they are trying to save an extra dollar. I believe it is the income tax which compels them to resort to this kind of thing. In the case I have mentioned they said that the beds did not even have a chance to get cool. That may be all right in zero weather, but certainly it is not healthy. It is the amount of income tax these people are paying which puts them in that position. They do not mind that; they want to win the war and they will do anything possible to win it.
While on the subject of boarding houses, I wonder how these places are going to be heated next year. I know that in the city of Peterborough last Monday there was hardly a shovelful of anthracite coal. While I was in one fuel office a lady came in and asked for a cord of wood. The manager of the office said, "We have some wood, but we have no man to run the machine to cut it, nor have we a man to put on the truck to deliver it." Shortly after that, another woman came in on a similar errand and received the same answer.
Part of the trouble with our fuel situation, especially as regards wood, is that the subsidy of one dollar a cord which is now in force should have been granted last September. The operations of selective service are not allowing men to go into the woods; at any rate it did not allow them to do so. The snowfall this winter, of course, has been exceptional; also the farmers have not had their sons at home and one man cannot cut wood. I believe the dollar subsidy applies up to the end of June, but I do not believe we shall find men going into the woods now to cut wood. Spring is coming on, and the snow in the woods is in some places three and four
feet deep-I know that because I was in the woods last Saturday-and it will be wet, and men will not cut wood all day long when they are wet from head to toe. The situation is extremely serious, and I fear that next winter many a home will be without wood. The dollar subsidy will not attract men to go into the woods this summer to cut wood, because the black flies and mosquitoes will be at their worst in the spring and early summer, and the subsidy will not be in force after June 30. In my opinion mighty little wood would be cut even if the subsidy were increased to two dollars a cord. The only way that I know of to help the situation would be for the Minister of Labour (Mr. Mitchell) to have his selective service board arrange for gangs of men to go into the woods to cut as soon as possible, or alternatively, after the season of flies and mosquitoes is over. I will quote from a letter:
Regarding being unable to get labour to haul wood in our yard, we believe it is because of the severe weather conditions which have existed during the past two or three months, also because the average labourer refuses to do outside work when there are so many jobs available in different local factories, therefore we are not the only firm suffering accordingly.
In the Farmer's Advocate of February 11, 1943, the editor remarks:
The woodlot is taking on a new significance this year, but owing to deep snow and ice in many districts it is a frozen asset.
That is perfectly true because the farmer has not been able to cut wood in his woodlot. There is another thing which I think is wrong. In the release of March 8 from the office of the Minister of Munitions and Supply (Mr. Howe) it is said:
The staffs of the coal administration and of the dominion fuel board have been transferred to the munitions and supply department. James McGregor Stewart, K.C. is now coal controller and will retain his title and powers as coal administrator, under which he will continue to regulate prices of coal, coke, and wood fuel.
I think the government would have been a lot better off if they had secured a practical man for that position instead of a lawyer. I have much respect for lawyers, but in this instance a man who knows the woods and the cutting of wood and the handling of coal should have been secured instead of an office man. This is a case where a controller will be needed to control the controller.
The Minister of Finance in his budget is relieving those who have government annuities and allowing them to deduct from their compulsory savings the premiums on those annuities. This I know will meet with the approval of many annuity holders in Canada; in fact I have received a dozen or more letters already this session in regard to it.
1212	COMMONS
The Budget-Mr. Fraser (Peterborough)
I had a letter the other day from a farmer- in fact I have many; they are all frightened about the income tax. They are afraid they will not get the returns in in time; they do not know whether they should deduct for the food they grow and consume on the farm; they are all muddled up. The sooner the minister gets out a booklet instructing these farmers how to make out their income tax returns the better it will be. Just this morning I heard a gentleman say he thought the Minister of Finance had gone into the clothing business-I should say, designing clothes; because, he said, this year the Minister of Finance is making sure that there will be no change in the taxpayers' pocket. No, not a cent.
This war is being carried on on a tremendous scale; therefore the taxpayer has to expect to pay a tremendous amount of money for carrying on the war. The British navy is fighting at the present time on a front of sixty million square miles on the seas. I notice in a booklet I have here that his majesty's ship Cumberland, for example, was at sea for 206 days out of 215. The men on those ships are not shirking, and I know the people of Canada will not shirk.
Mr. C. It. EVANS (Maple Creek): In rising to speak at this time on the Ilsley pay-as-you go budget, I should like to add my word of congratulation to the minister for forgiving at least half of the 1942 income tax on earned income. This goes a long way to relieve the minds of many persons in the lower paid brackets so that they can budget and be at least even or practically so at the end of 1943.
We are living to-day in a world of rapidly changing events. Governments which are responsible for the administration of affairs either civil or in connection with the war have to try to foresee what may happen within twelve to twenty-four hours, or a week, or a month. I doubt if many governments to-day under existing conditions foresee much beyond one year.
From time to time we have heard considerable criticism in this house of the government's agricultural policy. Last evening we had that bombastic bombardment from the hon. member for Dufferin-Simcoe (Mr. Rowe), and prior to that we had many criticisms of the Minister of Agriculture (Mr. Gardiner) and his agricultural policy. Coming from an agricultural constituency and having been connected with agriculture more or less all my life I believe I can speak with some degree of assurance on agricultural matters. Therefore in this debate I shall direct my remarks closely to agriculture and agricultural problems.

Let me take hon. members back to 1939, the first year of the war. I well remember that, in December, 1939, the Minister of Agriculture, speaking in Winnipeg before an agricultural organization, outlined what he recommended to the farmers as the agricultural programme they should follow, at least for 1940, in food production. In 1941 and 1942 the-minister has followed that policy very closely, enlarging upon it to some extent as the demand for certain food products increased.
The main feature of that 1939 broadcast was-production of live stock, dairy and poultry products. He told farmers that these would be needed in great quantities in both Canada and Great Britain. If we review the three war years, 1940, 1941 and 1942, we find that, our cash income from agricultural products in Canada has increased each year until 1942 was possibly one of the highest years in our history, with the possible exception of the boom years 1928-29. We find that in 1940 Canada's cash income from agricultural products totalled $753 million. In 1941 it increased to $898-9 million, while in 1942 it reached $1,083 million. So that none will question that the agricultural cash income for the whole dominion has shown a substantial rise over the three war years. Included in that income is the bonus paid on dairy products, I believe, but not other assistance given to the prairie farmers. Therefore, if we include last year, 1942, we find that the income of the prairie farmers Was increased by almost another $100,000,000.
This afternoon I intend to direct my remarks more particularly to agriculture in the province from which I come. In the main, Saskatchewan was a cereal producing province prior to the outbreak of war and for at least, one year after. When the Minister of Agriculture advocated a change-over from the growing of wheat to an increased production of coarse grains, live stock and- dairy products, the Saskatchewan farmer answered that call. I should like to place upon Hansard a few figures indicating to what extent the farmers-of my province have increased food production in response to the minister's request.. First let us look at the live stock programme. In 1939 we had in Saskatchewan 1,170,200 head of cattle. In 1940 this number increased to 1,249,200, and by 1942 it had increased to 1,395,200. Our marketings increased also. In 1939 we marketed 172,865 head, while in 1942 that figure had jumped to 252,186, an increase of about 70 per cent. I believe these figures will indicate that our income from live stock products has greatly increased. The same can be said about hogs. In 1939 we had only 470,000 hogs in Saskatchewan, as a

The Budget-Mr. Evans
result of the drought years we had prior to 1939, but between 1939 and 1942 the farmers of Saskatchewan increased the hog population of that province by about 400 per cent, which I think is a very good showing. We also increased our marketing of hogs during the same period by about the same percentage, and it is-estimated that in 1943, the year we have just entered, our hog marketings will be increased by another ISO or 200 per cent. The same thing is true of dairy products. In 1939 Saskatchewan produced only about
25.000.	000 pounds of butter, but this increased in 1942 to 41,306,000 pounds. In 1939 we produced 35,550,000 dozen eggs, while in 1942 our egg production amounted to almost
47.000.	000 dozen. In 1939 we produced about
212.000.	000 pounds of poultry, while in 1942 we produced almost 259,000,000 pounds. This was all done as a result of the appeal by the Minister of Agriculture that the production of essential food products be increased.
I have given the figures showing the cash income from agricultural products for the whole of Canada. I wish to deal now with the figures concerning my own province, for after all that is what I am mainly concerned with, and I know the house will bear with me if I deal with provincial matters for a few moments. I should like to give the figures for the three full years we have been at war, and during which the policy of the Minister of Agriculture has been in operation. In 1940 our cash income from grain was only $109,-
343,000,	and from other field crops, $326,000; from live stock products, $27,255,000; from dairy products, $7,375,000, and from all other sources, including eggs, wool, honey and miscellaneous products, about $8,000,000, making a total cash income from all sources of $149,429,000. I am informed that this figure includes the subsidies paid on butter and dairy products but does not include the various bonuses paid to the farmers of western Canada, so that to that figure we must add something like $27,000,000, which would bring the total cash income of the farmers of Saskatchewan for 1940 to about $170,000,000.
Let us now look at the picture for 1941, to see how our income has increased as step by step the farmers have diversified their farming operations. In that year our income from grain was practically the same, $101,288,000; from other field crops, $350,000; from live stock, $38,235,000; from dairy products, $12,934,000, and the income from all other farm products increased in about the same proportion. Therefore we find that our total cash income for 1941, as a result of the policy that has been so much criticized by some of
our hon. friends from Saskatchewan, amounted to almost $159,000,000. Again this does not include the bonuses paid to the prairie farmers, and estimated in that year at about $35,000,000, which means that the cash income of the farmers of Saskatchewan increased in 1941 to about $197,000,000.
Let us now look at 1942; and when we compare these figures with those for 1939 who will say that we have no definite agricultural policy in this country? In 1942 our cash income from grain was about the same, $110,421,000, and there was a slight increase in the income from all other field crops, to $356,000. Just in passing let me say that we have heard a great deal about Saskatchewan not being able to produce certain commodities, but part of this amount was realized from home grown fruits and vegetables. Live-stock production income in 1942 jumped considerably. We find that our income from this source was $53,327,000. Income from dairy products increased to the sum of $16,556,000. Then we must take all other income from agrieulutral products such as eggs, wool, honey and miscellaneous items. We find that in respect of these items there is an increase to $8,898,000, making a total income for 1942 of $189,558,000. This figure does not include bonuses paid to the prairie farmers. In 1942 it is estimated that bonuses paid to Saskatchewan farmers amounted to about $40,000,000, making a cash income of $229,55S,-000, or practically 60 per cent higher than it was in 1939, at the outbreak of the war.


Mr. WOOD:: What is the number of farms in Saskatchewan?


Mr. EVANS:: I think it is about 140,000.


Mr. DOUGLAS (Weyburn):: Would the hon. member explain the figure of $40,000,000 for bonuses in 1942. I know of only the wheat acreage bonuses. Is he including subsidies as well?


Charles Robert Evans: There was a carryover from
1941.	That was not included in the bonuses I added to 1941 income. We have had it broken down to show what was paid in 1941, and the amount paid in 1942. There is still some bonus money standing on account of wheat acreage reduction. This is a carryover for 1942, and is not included in the items I have mentioned.


Thomas Clement (Tommy) Douglas: Where did
the hon. member get the $40,000,000?


Charles Robert Evans: It was given to me by the Department of Agriculture, and I believe their figures are fairly accurate. As announced by the minister in Saskatoon, in January of 1943, we are carrying on our 1943 crop production
The Budget-Mr. Evans

programme along the same lines as were followed in 1941 and 1942, although extensions have been made where necessities have arisen for greater production.
I believe the Minister of Agriculture is faced with the greatest production task faced by any minister of agriculture in any country of the world. He is asked to produce in quantity and quality, and must produce his quantities under a price ceiling regulating the prices of food. That is a difficult task for any minister, but I must say the present one has made a wonderful job of it so far. I believe that in 1943 the farmers of Canada will answer the appeal by producing more and more foods in the quantity and quality required successfully to carry on our war effort.
For a few moments I should like to outline what is being done in Saskatchewan in 1943. I believe this outline is important on account of certain criticisms and statements which have been made respecting conditions of agriculture in that province. I hold in my hand an issue of the Regina Leader-Post of March 5, and I wish to place on Hansard a short extract from it. This is a press dispatch respecting a statement issued by the former food controller in Canada, the present minister of agriculture of Saskatchewan, Hon. J. G. Taggart. The statement was made before the annual convention of the Saskatchewan association of rural municipalities. The article states:
The agricultural minister said it was imperative that the farmers of the province comply with the dominion government's agricultural policy for 1943, to produce more cattle and hogs, because they were going to be needed to win the war.
"If they are needed to win the war, that's surely reason enough," Mr. Taggart told the convention, "but there is another reason. It will be to our advantage to follow this programme. Price of dairy products, meats, poultry, are above parity approximately 20 per cent, while wheat, oats, rye and barley are as much as 40 per cent below. Therefore the demand is for products with higher parity prices and the figures show the advantage in producing materials that are demanded."
The transformation of Saskatchewan farms from wheat-growing into stock-raising would not be such a large job, Mr. Taggart said, because figures proved that Saskatchewan had been swinging that way gradually for the past four years. He said that in 1938, 211,000 head of cattle, valued at nearly $6,000,000 was marketed in inspected slaughter houses, while last year the number had been increased to 328,000 head, and the value had reached $22,000,000. Hogs valued at sale a total of nearly $4,000,000 in 1938 and four times that price last year.
That is in 1942.


George Ernest Wood: This is a most informative address. In view of increased production on the farms of Saskatchewan, is there any indication that the farmers are liquidating their debts and mortgages?


Charles Robert Evans: Yes. Without doubt I believe the last survey indicated that that was so. 1 was talking to an official of one of the large implement companies who told me that in the district from which I come every account contracted in 1941 and 1942 had been paid. Those are, of course, only implement accounts. It was pointed out that substantial payments are being made on mortgage indebtedness. I do not wish it to be understood that we are liquidating our back debts, because I think anyone in business must know that under existing price conditions with respect to agricultural products, particularly those products produced in large quantities in western Canada, and concerning which quota marketing arrangements have been made, it is difficult to liquidate debts accumulated prior to the outbreak of war. Under the Farmers' Creditors Arrangement Act there has been a general reduction of debts. I am sorry I have not the figures here, and I should not like to quote them unless I could be fairly accurate. I believe, however, that the average adjusted debts in Saskatchewan would amount to about forty-four per cent. If my memory serves me correctly the exact figure is 43 point something or 45 point something.
I understand the agricultural programme is the same in all the provinces, because the programme outlined by the federal minister has been passed on to the provincial departments in each province, for coordination and cooperation. In Saskatchewan I believe our position is unique. In the last two years we have heard criticisms of our organization for the production of agricultural products throughout Canada. References have been made to organizations in the United States, and possibly I might be permitted to tell what we are doing in Saskatchewan. I do so because I believe ours is one of the first moves in Canada to get in direct contact with the individual farmer. In that province we have organized every municipality, so that in each we have a win-the-war committee consisting of members of municipal councils and other outstanding farmers. The duty of that committee is to interview every farmer in the municipality and to make a record of the man-power, the machine power, the number of cattle and other live stock held on the farm and to find out how we can assist, through the department of agriculture representatives and through the federal Department

The Budget-Mr. Evans
of Agriculture, the farmers to produce more in 1943 of the required food products. That is the first step we have taken.
But we have extended that. As I pointed out, our sales of hogs in Saskatchewan have increased 400 per cent over the 1938 figure. We have gone a step further to increase that production. I said that we might produce from 150 to 200 per cent more in 1943. Every municipality is taking an active interest in this production campaign. From information I have received from my own constituency I know' that the municipalities and the agricultural improvement associations have organized. Brood sows are being shipped into the municipalities and the local improvement districts. These are bred and sold at market value, the average price being around $25 to $30 apiece. You can imagine what it will mean in income next fall to the average wheat farmer in Saskatchewan if he has one, two or three of these sows on his farm.
I happen to have in my constituency an area which in normal crop years produces possibly as much wheat as any other area in Saskatchewan. I refer generally to the area surrounding Shaunavon and running down into Aneroid and into the Kincaid district, represented by the hon. member for Wood Mountain (Mr. Donnelly). I went to Shaunavon during the recess of 1941 and talked with the wheat farmers there and the municipal authorities and others about the possibility of changing from wheat production to the production of other agricultural products. I think all members wdll realize that it is hard work to get a wheat farmer to adopt any other viewpoint than that of higher prices for wheat and the production of more and more of that commodity. I happened to be in the reading room the other day and on reading the Shaunavon Standard I noticed that in one month the farmers of the Shaunavon area had shipped out 1,868 cans of cream. They have organized themselves and are going into hog production. The editor had a good write-up on the programme that they intended to follow in that wheat growing area. The leadership being given by the Minister of Agriculture to farmers, not only of western Canada but all over Canada, will produce this year the greatest quantities of food that we require in Canada and to feed the peoples of Great Britain and any other united nation that may need food. We are going to do more than we ever did in the past.
There has been another extension of our production programme in Saskatchewan. It will be recalled that in the winter of 1941-42 the farmers of Canada were asked to produce more wool. In my constituency there is a
large ranching area along the southwest and western side. This area produces vast numbers of sheep and cattle.. Last year I think we produced something over a million pounds of wool from the flocks we have there. But that was not enough for the superintendent of the experimental farm at Swift Current. He undertook to increase sheep production in that southwest corner of the province and in the constituency represented by the hon. member for Swift Current (Mr. Graham). In that area there are great natural resources which lend themselves to an increased production of sheep.
In my own constituency there are three major irrigation projects where vast quantities of alfalfa, coarse grains and other winter feeds are grown. Mr. Thompson set out to organize the farmers around each of these irrigation projects. Sheep cooperatives were formed at Valmarie, Eastend and Maple Creek. He has increased the holdings of sheep by ten thousand head. Taking an average of seven to eight pounds a fleece for a range sheep, this means an increase of something like 80,000 pounds of wool. But he was not satisfied even with that. He went out among the farmers all through Swift Current constituency and through my own, in fact all the way west from the third meridian to the Alberta border and north to the Saskatchewan river. He encouraged the farmers to raise small numbers of sheep, anywhere from ten to a hundred head. The result was that the sheep holdings in that area increased by about 40,000 head, which means a greater production of wool for 1943.
I shall not take up any more time in discussing these matters, but I wish to make it perfectly clear that the farmers of Saskatchewan will produce this year more and more of the food products that are required for the winning of this war. The testing time for Canada is about to come. This year we shall be asked to work, to save and to lend. I am sure that the people and the farmers of Saskatchewan will do their utmost to be true Canadians and be ready to serve their country by working and saving and lending any spare money they may have.


Mr. R. W. GLADSTONE (Wellington South):: Mr. Speaker, I intend to preface my remarks to-day by reading the message of March 6 from Prime Minister Churchill to the Prime Minister of this country (Mr. Mackenzie King). He said:
I am deeply touched by your very generous message and I send to you and to all members of the parliament of Canada my heartfelt thanks.

The Budget-Mr. Gladstone

I recall -with gratitude the -warmth of the reception which you all gave me when I visited Canada in December, 1941.
In the darkest days, Canada, under your leadership, remained confident and true. Now the days are brighter and when victory is won you will be able to look back with just pride upon a record surpassed by none.
He pays a tribute to the tremendous contribution. that Canada is making to the great struggle in which the world is now engaged. I should like to apply Mr. Churchill's statement as a direct and highly deserved tribute to the Minister of Finance (Mr. Ilsley) by using these words:
In the most difficult days of financing Canada's war effort under the leadership of our Minister of Finance, the people of Canada have maintained utmost confidence. After the war we will look with pride upon a record in finance surpassed by none.
I have one suggestion to make in connection with budget speeches, that is, that each year this speech should be broadcast. It seems to me that this is the one speech delivered in parliament to which the people of Canada from coast to coast look forward. While it might be an innovation in parliamentary procedure, I believe that great value would accrue if it were possible for the people to hear these budget speeches. The speech of the Minister of Finance, if broadcast over the radio, would have convinced all Canadians of the magnitude of our task and would have been an inspiration to a red-blooded effort on their part. The position of the Minister of Finance is extremely difficult. He is the balance wheel in our national economy. People are not critical about the money he takes from them, but they are critical about the way in which the various departments expend their money. On this point I shall have more to say later, especially in the discussion on the war expenditures committee.
This war effort, Mr. Speaker, is entirely different from the experience of Canada in the last war. I should like to discuss it briefly under three headings: (a) the fighting forces; (b) equipment; and (c) civilian participation.
The fighting forces must be highly trained in the use of all the new implements of war which science has devised. Armoured tanks ignore fortifications and terrorize fleeing civilians. Bombers rain deadly explosives on charted targets. Fighters dive at 550 miles an hour to rout the enemy. Battleships to-day must lurk in secluded bays while speedy long-range submarines prey on ocean traffic. Protection for this ocean traffic comes from aircraft carriers, and from small speedy warships 
of various designs. Our fighting forces on the land and sea and in the air must undergo special training in order to handle the modem implements of war with which they are equipped.
The equipment demands have been almost completely revolutionized since the last war. In the last war we placed the emphasis on guns and shells and trenches. In this war we have modern implements of every description designed by skilled scientists and technicians. In the last war our munitions board occupied a few rooms above stores on Sparks street. In this war we have buildings galore all over the city of Ottawa and also in the cities of Montreal and Toronto. We have scientists, technicians and specialists designing and producing these modem implements. The whole country has been harnessed to their production so that perhaps upwards of a million workers are engaged in our war factories. Of necessity boards have had to be set up in order to handle this great programme and direct these huge organizations. These boards have come under criticism, as is always the case where the human element is involved.
Civilian participation in this war is entirely different from that in the last war. I am sure the people of Canada quite generally are satisfied with our munitions programme. I am sure also that they are delighted that our prices have not soared as they did in the last war. I am sure that they are pleased that our whole economy has been kept well balanced and on a fairly even keel. But the people are often irritated over some of the seemingly senseless orders of these boards. They are irritated also by the expenditures of these boards, expenditures which so often appear to be wasteful and unnecessary. The very fact that values have not soared as they did in the last war will be a decidedly favourable factor at the conclusion of this war, when we shall not have the disastrous effects of large depreciations. Those soaring values in the last war brought trouble to many people during the intervening years.
I wish to devote a little time to considering to-day and to-morrow. We have prosperity to-day to a very large degree. It is true that in places some adjustments should be made. It is true that in places adjustments have come rather too late. It should be our endeavour to stabilize this prosperity if at all possible for the future days. It should be our endeavour to get away from these cycles of prosperity and depression so often recurring.
The great mass of our people, generally speaking, may be divided into two classes, agriculture and labour. My home is in the

The Budget

Mr. Gladstone
good county of Wellington, which generally is favoured with good crops. Years ago fine houses and good barns were built in the county. I often wonder how, under present conditions and methods of operating, those fine houses and good barns could be replaced. Many of them are going into disrepair. It seems as though something may be wrong if we cannot to-day build as our grandfathers were able to do years ago. Is it a matter of buying prices and selling prices? Are there some other reasons why the farming community is not in as prosperous a condition as it was years ago? Possibly it is due to too much overhead, to high labour costs. Recently a study has been made in the British isles pertaining to agriculture. The farmers were classified in three types, A, B, and C. The A class included those who were making a success of farming, the B class those who could be helped, and the C class those who should be removed to some other vocation. It does seem to me that our institutions of science and agriculture through the instruments of our departments of agriculture, federal and provincial, should lend more direct assistance to the farmer. A more intensive survey and study of the operations of individual farmers might be made in order to give to the individual farmer directly the benefit of the findings of these institutions of agriculture through study and research.
Western Canada is a great producer of wheat, but one wonders whether we can continue to produce in such enormous quantities, since other countries are likely to endeavour to become, in the largest possible measure, self-contained. One wonders also if something cannot be done to equalize the spread between prices in Canada and in the United States, as illustrated by a differential of fifty cents per bushel of wheat. One wonders if a little scaling up of farm prices would be a serious handicap to the consumers in our towns and cities; because if by some such system we can give the Canadian farmer greater prosperity, it must be remembered that when he makes a profit he spends it in the purchase of goods produced in our factories. We should encourage diversification of our products-a proceeding which happily is going on now in western Canada. We should develop to the utmost our resources of every description, in order that those employed in connection therewith may become purchasers and consumers of the products of the farm.
We should encourage agriculture for another reason. Very fine citizens are produced on the farm. Boys and girls grow up with good habits of right living. They learn how to 72537-77}
work. They learn how to save money. They learn much of life through contact with nature. It often seems to me that some means should be undertaken by which every boy in the cities and the larger towns would be given an opportunity to spend six months continuously on the farm. His education could very well be interrupted at some point, say between the ages of fifteen and seventeen, to enable him to do that.
Employment in our factories is contingent on the need for goods. If we give the farmer prosperity it will result, through his greater purchasing power, in larger demand for the goods of our factories. Likewise as regards the development of our other resources: there will be a consequent demand for goods from our factories; and these all together, will produce a cycle of continuous demand for the products of the farm.
Another large group to be considered is that which is made up of the white collar workers; clerks, teachers, executives, scientists and all the professional class. Their position will improve and can only improve with the development of markets and fair prices for our farm products and the further development of our varied resources. The depression which affects the farmer producer hits everybody in the city.
I can think of another scattered group, the schemers and filchers and near-shylocks; I mean those who live by their wits and their scheming at the expense of others. May I suggest that we devote some of our attention to correctives which will give a fair opportunity to the great mass of the people, and take from those who have now, in one way and another, unfair advantages. We need not destroy the desirable things that have been accomplished in the past to get rid of the barnacles that are a handicap to the higher development of the great mass of the people.
When the war is over, half a million or more soldiers will return for other work. We shall release from our munitions plants upwards of a million people who have been diverted to new work during the war. All these people, soldiers and munitions workers alike, will have acquired new training, and will be better fitted to take on larger duties than any they performed before they entered various aspects of war service and production. It seems to me that there will be an opportunity of utilizing their services in cooperating with science in the development of our resources. But of course there will be those who are sick and maimed and who must receive our generous consideration in the matter of homes and pensions.
The Budget-Mr. Gladstone


Mr. P. E. WRIGHT (Melfort):: Mr. Speaker, I should like to compliment the hon. member who has just taken his seat (Mr. Gladstone) upon the subject matter of his address, which was very much to the point.
While listening to the budget speech of the Minister of Finance (Mr. Ilsley) I found it very difficult to picture in my mind what these tremendous sums of money really meant, and I believe an ordinary citizen of this country would find the same difficulty. Most of us are accustomed to speaking of money in terms of ten dollars or a hundred dollars, and when we get into the millions and billions we are rather at a loss. I point out, Mr. Speaker, that if you had been born in the year one and had spent a thousand dollars a day, every day, up to the present time, you would have to live another 790 years, spending a thousand dollars a day, before you would have spent a
The Budget-Mr. Wright


Mr. GILLIS:: The last one held.


Percy Ellis Wright: Yes, I believe it was the last one held. The resolution on tariffs reads:
That the best interests of Canada demand that substantial reductions of the burdens of customs taxation be made with a view to the accomplishing of two purposes of the highest importance. First: diminishing the very high cost of living which presses so severely on the masses of the people; Second: reducing the cost of the instruments of production in the industries
The Budget-Mr. Wright

based on the natural resources of the dominion, the vigorous development of which is essential to the progress and prosperity of our country.
That, to these ends, wheat, wheat flour and all products of wheat; the principal articles of food; farm implements and machinery; farm tractors, mining, flour and saw-mill machinery and repair parts thereof; rough and partly dressed lumber; gasoline, illuminating, lubricating and fuel oils; nets, net twines and fishermen's equipments; cement and fertilizers, should be free from customs duties, as well as the raw material entering into the same.
That a revision downwards of the tariff should be made whereby substantial reductions should be effected in the duties on wearing apparel and footwear, and on other articles of general consumption (other than luxuries), as well as on the raw material entering into the manufacture of the same.
That the British preference be increased to fifty per cent of the general tariff.
And the Liberal party hereby pledges itself to implement by legislation the provision of this resolution when returned to power.
That is some twenty-three or twenty-four years ago. Before going any further, I should like to point out that the tariff is not the only means by which protection is given industry in this country. Protection is given also by the manipulation of exchange. During the last ten or twelve years industry has received as much protection from the manipulation of exchange as it has from the tariff. Having said that, I wish to point out what our position is to-day with regard to the tariff on some of the farm machinery which the Liberal party said in 1919 would be removed as soon as they were returned to power.
Take tractors, for instance. There is no duty on tractors coming into this country, but there is an eleven per cent exchange on the Canadian dollar and there is a ten per cent war exchange tax, or a total of twenty-one per cent protection on tractors entering this country. The farmers of Canada pay twenty-one per cent more for their tractors than they would have to pay if that exchange were not there. Combines are being used more and more in this country. There is a seven and a half per cent duty on these, a ten per cent war exchange tax and an eleven per cent exchange, or a total of twenty-eight and a. half per cent protection.
Milking machines are needed to obtain the required increased dairy production. There is a 10 per cent duty on these, a 10 per cent war exchange tax and an 11 per cent United States exchange or a total of 31 per cent protection. Small gasoline engines are used on nearly every farm for pumping water, for running the milking machine, for running the separator and for a hundred and one other duties. The duty on these is 25 per cent;

there is a 10 per cent war exchange tax and an 11 per cent United States exchange. I give a tabulation of these figures as follows;
Duty	Sales tax	Excise tax	War taxTractors 	Free	None	None	10%Combines 	
Engines (washing	74%	None	None	10%machines) 	25 %	8%	None	10%Milking machines 10 % Cream separators 124%	None	None	10% 10%
On the washing machine that is used on nearly eveiy farm, the machine operated with a small gas engine, the duty is 25 per cent; there is a 10 per cent war exchange tax and an 11 per cent exchange, or 46 per cent protection in all. Let us see just what is the accumulative effect of all this upon the price of a washing machine. In the first place, a machine which would cost $100 in the United States, with a duty of $25 would cost in Canada $125. The war exchange tax of 10 per cent would increase this to $137.50, and the regular exchange would bring it up to S151.25. So far it has cost $51 more for this machine in Canada than would be paid for it in the United States, but let us carry on a' stage further. There is an 8 per cent sales tax on this machine which increases the cost to $163.45. The wholesaler or importer who brings in the machine will want a commission of 10 per cent, which would bring the cost to $179.34. The retailer's commission on this type of machine is at least 30 per cent, which brings the cost to $233.72. That is the total cost to the farm home in Canada. I do not know just how my hon. friend can justify the policy which has been followed by his government which has been in power in Canada during seventeen of the last twenty-two years. It seems to me that it is time something was done with regard to these additional costs which are placed on the agricultural industry of this country.
My hon. friends to my right know that from 1932 to 1935 the difference in exchange between the British pound and the Canadian dollar was something over 18 per cent; the British pound was worth only $3.86. At that time we were selling practically all our exports on the British market; we were not selling any beef on the United States market. Our beef, our pork and our exports of wheat and coarse grains were all going to Great Britain and we were getting only $3.86 to the pound.
We were losing fifteen cents a bushel on every bushel of wheat we sold from 1932 to 1937, when wheat in western Canada dropped to as low as twenty-three cents a bushel. We were losing three cents a pound on every pound of beef we exported and losing two

The Budget-Mr. Wright
cents a pound on our hogs when we were selling them for three cents a pound. Is it any wonder, then, that agriculture in western Canada is in the position in which it is to-day? What is taking place to-day? That is the basis on which we are doing our purchasing. Then, when we go to sell our agricultural products what happens? When we attempt to sell our beef to the United States we find that that market is closed to us and that our price is based on the ceiling price that has been set on beef in this country. When we try to sell our flax to the United States-again, the ceiling price; when we attempt to sell our coarse grains-again, the ceiling price. We do not get the advantage we would have if we could sell in the United States market, and in addition we lose the advantage of the exchange. To sum it up, on everything we purchase we pay the toll. When we sell, we sell on the basis of a fixed price at home. Agriculture cannot get into any better position than it is in to-day as long as those conditions continue, and I urge my hon. friend the member for Swift Current (Mr. Graham) to continue to bring pressure on the government for the next twenty years and perhaps then something might be done about it.
I should like to say a word or two about the loans which we shall have to float during the coming year. We have to raise $2,750,000,000. That is a lot of money. It would not make so much difference, in my opinion, if all the people of Canada were able to subscribe equally to these loans because then we would simply owe the money to ourselves. But that is not the case and has never been the case. In the first victory loan floated the quota for Saskatchewan was set at $8,000,000 by some of the best financial experts we have in this dominion. It was their opinion that that was the amount of money which could be raised in that province. In the last loan, if the reports that came over the radio were correct, one mining company in Canada, International Nickel, subscribed $10,000,000. I ask hon. members, do they consider that we have a balanced economy in Canada when one mining company can subscribe more to a victory loan than the quota allotted to 870,000 people in the finest agricultural province of this dominion? It just does not make sense, and unless more of the people are able to subscribe to these loans, unless we can have a more equitable distribution of them, we shall have a very serious condition in Canada after this war.
I would point out that a very small proportion of these loans is being taken by our soldiers. How much are the 650,000 men who are in our armed forces able to subscribe to our war loans? A very small proportion.
How much are the people engaged in agriculture able to subscribe? Again a very small proportion. How much are the men in the income groups below, say $1,500 a year able to subscribe to our war loans? They are able to buy war savings certificates and take the odd $50 or $100 bond, and that is about their limit. Yet the three groups I have just mentioned comprise approximately seventy per cent of the population of Canada. In other words, Mr. Speaker, the remaining thirty per cent of our population are buying seventy per cent of our loans; after this war is over, that thirty per cent, through their holdings of these loans and the interest which will have to be paid on them, will be able to command the services of the other seventy per cent of the population of Canada, and that seventy per cent will have to continue to pay tribute not only for one generation but for generation after generation. That is not a healthy condition in any country. It is not a healthy condition for our soldiers when they come back to have to find that for generations they will be paying interest on the loans for the war which they fought and won. These loans should be placed on a different basis. We should have interest-free compulsory loans levied according to the ability to subscribe of the great corporations and holders of wealth. That is the only way in which we shall obtain an all-out war effort in this country with equality of sacrifice.


George Ernest Wood: Does the hon. member realize that some of these large financial companies, like insurance companies, which have subscribed to the war loans, are simply investing the collective savings of the ordinary common people of this country?


Mr. MacINNIS:: The widows and orphans again!


Percy Ellis Wright: I cannot see that the $10,000,000 which International Nickel subscribed has anything to do with the accumulated savings of the ordinary people of this country.


George Ernest Wood: There is nothing to prevent anybody from holding stock in International Nickel.


Percy Ellis Wright: The funds of some of our insurance companies represent the accumulated savings of our people, but that is not necessarily true of all of them.


Mr. COLD WELL:: They get a lot of money from mortgages.


Percy Ellis Wright: If you look into the affairs of insurance companies you will find that the small policyholder is very often wiped out



The Budget-Mr. Wright
before he ever gets any benefit from his insurance. As a matter of fact, in Saskatchewan during the depression years I am sure that well over sixty per cent of the policyholders-


An hon. MEMBER:: Ninety per cent.


Percy Ellis Wright: I am putting it conservatively when I say that sixty per cent of the small policyholders in Saskatchewan were wiped out. If we are to achieve the all-out war effort that we should have in Canada and that we can make, we shall certainly have to do something about some of these inequalities which exist in our system to-day.
On motion of Mr. Perley the debate was adjourned.
On motion of Mr. Mackenzie (Vancouver Centre) the house adjourned at 6 p.m.
Monday, March 15, 1943