Before I deal with the few features of the budget which I think deserve some comment, I should like to say that we seem to be getting into the habit of regarding budgets not as financial statements of the government's intentions but as preliminary drafts only. In 1931 when the Prime Minister (Mr. Bennett) was Minister of Finance he introduced a budget which later on was very materially altered. The same was true of the budget of 1932 and it will no doubt be true of the budget of 1933. I have no objection to changes being made-the changes which have been made in the past have been good ones-but I do think it unfortunate that ministers, of finance should get into the habit of simply getting up something and bringing it into the house by way of a preliminary draft and then having us go through the discussion in committee of ways and means with the idea of getting something out at the end of the session which may perhaps meet the requirements of the case. Such action misleads the business interests of the country because one does not know until the discussion has ended just what the budget actually will be.
I think this is all a vindication of the position taken by the opposition during the past two years that we in this House of Commons or in this parliament should not delegate legislative functions to the governor in council. Large powers are now vested in the governor in council under the various relief acts. These powers are such that the governor in council can deal with intricate and difficult matters, and if the manner in which the government will deal with them in council is exemplified by the manner in which they prepare their budgets, this House of Commons could certainly do a better job with the legislation of the country than could the governor in council.
There are a few and only a few provisions of the budget with which I wish to deal. The first is that relating to ex-service men. I want to read the part of the budget that deals with pensions. On page 3223 of Hansard of March 21, 1933, the Minister of Finance is reported as follows:
In this connection, I may say that with respect to pensioners who are in the employ of the government and who are paid the salary of the position, action will be taken whereby the payment of pension will be suspended during the period of such employment. Where the full salary of the position is not paid, the pension payment may not exceed the amount
of the difference between salary received and the established salary of the position. If the pension is greater than the salary, the employee shall elect either to be paid the pension and relinquish the position, or to retain the position and have the pension withheld during the period of such employment. This will be made applicable not only to the government service but also to boards or commissions whose activities are financed from the Dominion treasury.
The Minister of Finance, in a statement which he made last Friday, indicated that another statement might be made in regard to the government's intentions with respect to pensions, and from the newspapers I gather the impression that those intentions may be substantially modified. But we do not know that; no such statement has yet been made. Therefore I feel I would be derelict in my duty if I did not take the statement literally as set forth in the budget and submit to the house a few of the consequences that will follow if it is applied as it now stands.
There is, in the towns and villages of this country, a large class of disabled men, in receipt of disability pensions, who, encouraged by a provision that has been in the Civil Service Act since 1918 to apply for public positions, have done so and are now in charge of post offices and the like, in positions which give them a small return. A very common class in the villages and towns in the country is that of which the type is a pensioner who has lost an arm or a leg or has some other disability; he is getting a small pension and a salary of a few hundred dollars, and by uniting the pension and the salary he is able to support his wife and family. If the passage that I have read from the budget speech means what it appears to mean, that pensioner is to be put to a choice; he must choose between continuing to take the pension and continuing to take the salary, and if the salary is larger than the pension, this means, despite the statement of the Minister of Finance that the government has no intention of interfering with the sanctity of pension contracts, that this man will be deprived of his pension. It is not, I think, necessary to argue to the house the injustice of such a course. It is completely subversive of the whole principle underlying the pension legislation, and without labouring the matter any further, I feel sure that will be one of the budget provisions which will be changed. It will have to be changed if the justice of the case is to be met and if the obligations of the country to ex-service men are to be carried out.
Another provision of the budget about which I should like to speak for a few minutes, which will not be changed, and which I should
The Budget-Mr. Ilslcy
not like to see changed, is the proposal of the government to appoint a royal commission-
To study the organization and working of our entire banking and monetary system, to consider the arguments for and against a central hanking institution and to make recommendations for reviving or supplementing our existing banking and monetary legislation.
My only comment is that that intention has been announced very late in the day. Had the government appointed a royal commission eighteen or even twelve months ago, I feel sure this country would be better off than it is to-day. In September, 1931, Great Britain went off the gold standard. At that time our currency went down in terms of United States funds. The British pound went down to a very marked degree and immediately currency became, if it was not at that time-and I think it was then-one of the burning questions before the people of the Dominion of Canada. Great Britain, realizing the importance of the question, had, before that, appointed the Macmillan commission, which had made its report on currency and monetary matters in the old country. Canada should have taken a similar course,, or at least she should not have pursued the policy of laissez-faire.
I want to bring to the attention of the Minister of Finance the importance of the question from a practical standpoint. In the constituency that I have the honour to represent in this house, currency, the value of the pound sterling, is a matter of everyday conversation. As hon. members know, the largest single industry in my riding is apple growing and exporting, and when the pound sterling went down, as it did within the last shipping season, to between $3.55 and $3.60 in terms of Canadian money, our apple exporters suffered a terrible blow so far as their purchasing power was concerned. Consequently they have begun to ask and have been asking questions, and they have been taking a tremendously deep, not academic, but practical interest in this subject of currency. They had been brought up on the idea, I think, that gold should be the standard and that we should remain on the gold standard in this country. But when they saw that Great Britain went off the gold standard with results which apparently were not unfavourable; when they saw that the Scandinavian countries, Denmark, Sweden and Norway followed Great Britain off the gold standard; when they saw the Dominion of New Zealand and the Commonwealth of Australia taking steps to lower the value of their currency, and, finally, when they saw South Africa, the greatest gold producing country in the world, deliberately link its pound with the pound sterling, they began
to wonder whether a policy of laissez-faire in currency matters was the proper one for this dominion. They saw that when our dollar went down in the United States, instead of this hurting them, it helped them, because the pound sterling went up in the Annapolis valley; they got greater returns for their apples. They wanted authentic information as to what this country should do; they desired to know whether it was just that debts-and the majority of them are loaded down with indebtedness to banks, mortgage companies and private lenders on mortgages-which were contracted when money was not worth very much, should be paid off in full in money which is worth a great deal more than when the debts were contracted. They realized that if our dollar became depreciated it would mean that municipalities and provinces, the dominion itself, and certain corporations in this country would have a greater burden of debt if they had to meet their debts in American funds, but they wondered whether that disadvantage would not be overcome by the corresponding advantage of an awakened business activity through inflation. It will be recalled that in 1925 in Great Britain the bankers, almost unanimously I think, were of the opinion that Great Britain, for the same reasons that the Prime Minister and the bankers of this dominion advocate what is called sound money to-day, should be brought back to the gold standard on a parity with the United States dollar. They did that against the advice of some economists who were regarded as radical and unsound at the time, but who since have been proved by universal consent to have been right. No one to-day contends that Great Britain was wise in going back in 1925 to the gold standard on a parity with the American dol'la-r. It is a question in the minds of economists whether the policy outlined by the Prime Minister yesterday, and stated by him and the Minister of Finance in public addresses throughout this country and in this house, of what has come to be known as "sound money", is really a sound policy. But to these questions there has been no authentic answer, and I say that this government has pursued a wrong policy in keeping the question shelved. At the beginning of this session the Bank Act should have gone before the banking and commerce committee for revision in the usual way. The appointment of a royal commission at this late date will mean delay in the solution of this problem, and the postponement of any action whatever on this important question for another year at least. The .commission should
The Budget-Mr. Ilsley
have been appointed a year or eighteen months ago. I support the appointment of the royal commission, yes, but I say that the government is to be censured for not having taken long before this some step in relation to currency and banking and monetary problems.
I want to refer for a few minutes to the taxation provisions of the budget. Before I do so, let me say that the statement made by the Minister of Trade and Commerce (Mr. Stevens) this afternoon to the effect that the hon. member for Shelbume-Yanmouth (Mr. Ralston) and every member of His Majesty's opposition are opposing every provision of this budget by supporting the amendment moved by the hon. member for Shelburne-Yarmouth is not a correct statement.
Subtopic: CONTINUATION OP DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE