hon. member for Weyburn (Mr. Young) asked a question with inspect to the wheat agreement. I find that the answer which I gave him the other day as to the computation of acreage on the three-year average, and 3'ield on the ten-year average was correct. I propose by the end of the week, if I receive the information I am seeking, to give a more formal statement with respect to the whole matter.
Mr. Speaker, I should like to ask a question of the Prime Minister. In recent months has the government given consideration to the advisability of setting up a regularly constituted wheat marketing board, and if so when may we expect an announcement thereon? As I failed to extend to my right hon. friend the usual courtesy notice in connection with this question, a reply at a later date will be satisfactory.
Topic: WHEAT MARKETING BOARD
Subtopic: QUESTION AS TO ADVISABILITY OP CONSTITUTING SUCH BODY
This is a bill which I have introduced at the request of a very reputable set of people. While I know very little about it myself I am advised that it follows in its terms precisely the bill that was passed by this house last year. This bill has to do with the making of small loans on personal security. I am aware that there was some objection made to the bill last year, but as far as I am advised there was no change made therein, and I am also told that, the superintendent of insurance approved the principle and thought that such companies as these were of some use in the community as they absorbed the pressure to get small loans rather than large loans, and loans on personal property rather than on real property.
I would like to make two observations upon the second reading of this bill. My first observation is that we have a bill before the house setting up a central bank, and therefore I do not see the necessity of incorporating the Small Loan Company of Canada.
My second observation is a more serious one. We all remember the Stavisky scandal in France which came about through the bankruptcy of a corporation of this very kind. Parliament should be very careful about incorporating small loan companies in Canada. I have always advised my electors to be prudent in these matters. I do not see why these gentlemen should come to parliament for a bill of this kind because there are loaning facilities in every branch of every chartered bank in Canada. These chartered banks come under the department of the hon. Minister of Finance (Mr. Rhodes), and there is a very thorough inspection of them, while the small loan companies are not subjected to the same inspection and care. If we give this bill its second reading I am afraid that people might go throughout the country selling shares of this corporation, just as they have done in the case of other companies, stealing the people's money and holding out to them the prospect of making huge profits if they invest in such a scheme. We know these birds of prey who tour the country urging the people to invest their money in such and such a scheme which the promoters say will produce for the people a profit of 25 and sometimes 50 per cent a year. But what happens? If a man subscribes $500 in such a scheme they cash his cheque and give him back $250 the same day and tell him, "Here is your profit, and you are getting it back the same day that you invested your money." Then they decamp with the other $250 and he never sees them again until the police catch them.
There was a finance corporation that failed in Toronto a few years ago. I am not against finance. I am not against the lending of money to poor people, but I do not like what we call in French "prets a la petite semaine"-that Shylock method of lending money to individuals.
Companies of this sort ask all kinds of guarantees. We do not know anything about any of these people. They may be honest.
Small Loan Company
We may give them the benefit of the doubt and say that they might be honest but perhaps they are not, and it is my duty, representing not only my county but the Canadian people in this parliament, to advise my colleagues to be very careful about companies of this kind, and also to ask my hon. colleagues in this house not to let this bill pass without first of all scrutinizing it very thoroughly. Otherwise the people will say, "It is you, the House of Commons and the Senate, which passed this legislation giving these people the chance to cut the flesh of our fellow-citizens." I do not see the necessity for this bill. I do not know any of these people. I am always ready to oblige anyone who comes here with decent legislation, and perhaps this is decent legislation, but perhaps it is not. We need more information, and I would ask the hon. gentleman who has moved the second reading of this bill to delay before pressing for a vote on the second reading so that we may get more information.
It is a long section, and the hon. member has the bill before him. Paragraph (b) provides:
Notwithstanding anything contained in the Interest Act, or in the Money Lenders Act, or in paragraph (c) of section sixty-three of the Loan Companies Act,
-this company may do certain things which the section goes on to enumerate. I just wish to point out to the house that these various acts mentioned and section sixty-three of the Loan Companies Act were passed for the very purpose which the hon. member for Temiscouata (Mr. Pouliot) has pointed out, for the protection of the people of this dominion, and that they have been on the statute books for many years. I am of the opinion, regardless of what the promoter of this bill may say, that we have quite enough of these small loan companies acts, and perhaps too many already, and the time has come when we should scrutinize them with a great deal more particularity than we have done in the past.
I would also call attention to subsection (i) of section five which permits the company to lend on various types of securities, and I would particularly ask hon. gentlemen to note that although subsection (i) of section five provides that the interest rate may not be more than seven per cent, this interest is deducted at the time the loan is made, and that the amount loaned is payable weekly, monthly or per annum as it may be provided, aind so at the very end of the first month there is an overlapping of interest, and before the loan is finally paid off the party borrowing has paid very much more than seven per cent interest.
The next subsection (ii), marginally noted, Charges for Expenses, provides that two per cent .upon the principal of the loan may be charged by the company for expenses. That makes nine per cent, and more as I have already pointed out.
The next subsection (iii) provides that there may be an additional charge. This subsection provides that for the drawing of a chattel mortgage which they take upon the various chattels as security they may charge an additional $10 regardless of the size of the loan. This is exorbitant, and I protest and ask the house, if they decide that this bill shall go to the private bills committee, to see that the whole bill be very carefully scrutinized in order that the general public may be protected.
Mr. Speaker, I am inclined to agree with the hon. gentleman who has just taken his seat, although I am not unmindful of the fact that in days gone by similar charters have been granted by this parliament. In those days I protested against the granting of charters which gave to a company powers of the character mentioned in this bill. Surely the days of usury are past; if the chartered banks of this country are to be limited to six and seven per cent by action of this parliament, this same parliament should not set up a company which can charge forty per cent. Personally, I think it would be fair to have this bill go to the private bills, the banking and commerce or some other appropriate committee but I think this parliament should pause and consider before there is created under the imprimatur of this and the other house a corporation which will be able to do what this bill will permit it to do. I feel like voting against the second reading but if it is the sense of the house that this bill should go to a committee, well and good. Personally, I do not think we have room in this country for
Small Loan Company
this class of company although I am bound to say that the superintendent of insurance has stated before committees of this house that this class of corporation fills a need in the community. I never agreed with him and I propose to vote against the second reading.