April 18, 1933

LIB

Frederick George Sanderson

Liberal

Mr. SANDERSON:

I do not know whether I am in order now, but I should like to put a question to the minister for information. It affects the whole act and I have never heard any explanation in regard to it. In what way does this bill affect the lines of the Canadian National Railways in the United States?

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CON

Robert James Manion (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. MANION:

The lines in the United

States are not affected at all so far as cooperation with the Canadian Pacific is concerned. That is as regards Part II. Nor are they affected so far as Part III of the bill is concerned which deals with the arbitral tribunal. But so far as Part I is concerned, the American lines are affected just the same as any other portion of the Canadian National Railways, because Part I applies to the Canadian National Railway Company alone; it does not apply in any way to the Canadian Pacific as regards cooperation or otherwise. My legal adviser points out that the trustees are not the directors, and that is true. When the new trustees are appointed they will not be the directors of either the Grand Trunk Western or the Central Vermont, because by the laws of the United States these lines have to have certain groups of directors. They are both American corporations and naturally they have to be managed according to the regulations of the Interstate Commerce Commission, so in that respect they are in a somewhat different position. So far as Part I can apply to those roads it would apply; but so rar as cooperation with the Canadian Pacihc ;s concerned, that does not apply at all in regard to Part I of the bill.

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LIB

Frederick George Sanderson

Liberal

Mr. SANDERSON:

For further information, is not the board of directors of the Canadian National railway system also the board of directors of the lines owned by the Canadian National in the United States?

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CON

Robert James Manion (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. MANION:

No. They have their own separate boards of directors, both the Central Vermont and the Grand Trunk Western.

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LIB

Frederick George Sanderson

Liberal

Mr. SANDERSON:

I take it from the

minister's reply that when this bill becomes law the trustees will have no jurisdiction over the lines in the United States?

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CON

Robert James Manion (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. MANION:

That is quite true so far

as aobuial management is concerned, but of *course they will have supervision over those lines in a general way just as the board of

directors to-day has general supervision over them as a part of the Canadian National railway. I do not know if I have made the difference clear to my hon. friend.

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LIB

Frederick George Sanderson

Liberal

Mr. SANDERSON:

Perhaps it is my fault that I do not quite see the difference. What I should like to know is this: If this bill becomes law, who will control the lines of the Canadian National in the United States? Who will have the management of them?

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CON

Robert James Manion (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. MANION:

The trustees will have the management so far as the board of directors now have the management. They will be general snpervisors, if I may put it in that way, of the whole Canadian National railway system. In addition, there is a board of directors of the Grand Trunk Western and of the Central Vermont, some of whom are directors as well of the Canadian National in Canada, and some of whom are Americans. Through these boards these American lines would be managed subject to the control of the trustees as to financing, and generally in an advisory way.

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LIB

William Daum Euler

Liberal

Mr. EULER:

Will the new board of

trustees have representation on these American boards?

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CON

Robert James Manion (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. MANION:

Yes, no doubt.

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

We own all the shares.

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LIB

William Daum Euler

Liberal

Mr. EULER:

Will one of the trustees be

on each board?

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CON

Robert James Manion (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. MANION:

For example, some of the

directors of the Canadian National are also directors of the Grand Trunk Western. My deputy minister is a director of both of them, and so is Mr. Hungerford; Mr. Grant, the financial comptroller, is also one of the directors over there. That might have to be changed, but perhaps not. It is quite probable that one of the trustees, or possibly two, would be directors on the boards of the United States, but I have not thought that out sufficiently.

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LAB

Abraham Albert Heaps

Labour

Mr. HEAPS:

When this bill was first before the committee the Minister of Railways promised to get certain information in regard to the effect of cooperation or the consolidation of train services between Montreal and Toronto and Ottawa and Toronto. I would ask him if he has that information now and if he will give it to the committee.

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CON

Robert James Manion (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. MANION:

I am sorry I have not

that information. I must confess that I have overlooked that detail. I remember quite well that my bon. friend wanted information

C.N.R.-C.P.R. Bill

as to what would be the effects on labour of the general cooperative scheme. I looked into that matter and found that that information was not available. I am afraid that I have neglected to secure the information my horn, friend now asks for as to the decrease in labour employment because of the pooling of trains between Montreal and Toronto and Ottawa and Toronto, but I shall be glad to get it for him.

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LAB

Abraham Albert Heaps

Labour

Mr. HEAPS:

There was more than that involved. There was also the question of the anticipated financial saving as a result of this consolidation of services. I should like to go even further than that. The dividing line between consolidation of services and cooperation or amalgamation is so thin that any subsequent enactment against amalgamation does not mean anything 'because by this bill to all intents and purposes we are going to have cooperation or the amalgamation of services under two managements instead of one. In the case of the consolidation of services between Montreal and Toronto, and Ottawa and Toronto, for instance, to all intents and purposes there you have amalgamation under Canadian Pacific and Canadian National management, and what I should like to know is what are the anticipated savings over a certain period of timie for the Canadian National and the Canadian Pacific as a result of that consolidation of services. Secondly, what is the amount of labour that has been displaced as a result of that same consolidation of services. While the minister is obtaining that information I think he might go a little further. As I said on a previous occasion, it is common knowledge that efforts are already being made by the two railways to bring about greater consolidation and cooperation of services right across the country. In the last few days I have been among a great many railway men, and the spirit of these men has been completely broken down by the bill that is now before the house. Men with fifteen or twenty or twenty-five years of service do not know how long they are going to be kept in the employ of the railways. I know that engineers have been looking over many of the large terminals of this country on behalf of the railways to see what saving might be made by the closing down of certain terminals and the consolidation of services right across the country. I anticipate myself that in a short time, perhaps two or three years, about twenty thousand railway men will find themselves without a job. Now that is a very serious state of affairs. I do feel before the bill passes the committee hon. members ought to be fully aware of the impli-

cations involved in it. I am not so much concerned about tribunals or the powers of any board which may be appointed under the bill, but I certainly am concerned with any move to introduce legislation which will have the effect of throwing about 20,000 men out of work when, as a matter of fact there are hundreds of thousands walking the streets with no possible opportunity of being absorbed into industry. In addition to obtaining information in regard to the consolidation of services between Montreal, Ottawa and Toronto, and the effect such consolidation has had upon the financial situation of the two railways, I am asking the minister now to obtain information showing what efforts are now in progress, or what action has been taken by the two railway companies, towards cooperation in services between other terminal points in Canada.

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CON

Robert James Manion (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. MANION:

My hon. friend asked that question a few days ago. However in listening to the discussion which followed I am afraid I overlooked the smaller detail in attempting to oblige him with information on the larger points at issue.

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LAB
CON

Robert James Manion (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. MANION:

Certainly Montreal, Ottawa and Toronto are small when compared with the whole of Canada. So far as the larger question is concerned I could not and cannot obtain information concerning it. The railway management informed me that they are only surveying the whole matter at the present time. They cannot give me any estimates and I cannot force them to give me estimates in regard to the number of men who may possibly be laid off through cooperative efforts or by pooling the use of terminals.

The hon. member has stated that about 20,000 men may be laid off. I do not in any way pretend to be an expert in railway matters, but I believe that instead of laying off men in the. near future, due to the cooperative efforts being made, the railways will be taking on men. If they do not, then I think it will be a serious matter both for the railways and the country. With all due respect may I say that some people, including some railway men themselves, to a certain extent have overlooked the present financial condition not only of the railways but of the country. The railways must effect economies or they will be in such condition that not 20,000 but more men will be laid off for some time or, at any rate, until the railways get into a better financial position than they are to-day.

C.N.R.-C.P.R. Bill

This country cannot go on paying $50,000,000 or $75,000,000 a year out of its revenues for the Canadian National Railways, without serious effect upon the whole financial structure of our country. Last year the Canadian Pacific Railway barely earned its fixed charges, or the interest on its bonds. At any rate, it has paid no dividends on its common stock, and I believe it has discontinued dividends on its preferred stock. Hon. members will see that it has barely earned sufficient to pay interest on its bonds. Therefore unless there is a revival of business, the Canadian Pacific Railway, too, will be in a very serious condition. May I add that in the last week the decrease in traffic on the Canadian National railways, and no doubt on the Canadian Pacific railway, continued. So far the traffic has continued to decrease each week in 1933, when compared with the same weeks of last year. The decrease in gross traffic has amounted to about $600,000 a week.

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LAB

Abraham Albert Heaps

Labour

Mr. HEAPS:

Could the minister give us the percentage?

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April 18, 1933