March 11, 1937

LIB

James Garfield Gardiner (Minister of Agriculture)

Liberal

Mr. GARDINER:

The message was read to the meeting.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CCF

Major James William Coldwell

Co-operative Commonwealth Federation (C.C.F.)

Mr. COLDWELL:

I had to address a meeting 100 miles away the same evening, and I attended for a short time only. May I ask, what of the statement of the hon. member for Melville (Mr. Motherwell)? The hon. member for Lake Centre (Mr. Johnston) may remember the statements made at the meeting at Semans. Also the hon. member for Swift Current (Mr. Bothwell) was at the Cabri

meeting, which was attended by a large number of persons and the town band. He agreed that the board should be continued and heard the resolution condemnatory of the government. At this point may I say that the resolutions, as my files testify, were quite evidently drawn by a very large number of different people. There are differences in the phraseology and in the terms; sometimes even slightly different things are asked for; but they all criticize the government on two grounds, first, the discontinuance of the wheat board method of marketing grain, and second, the setting of a minimum price which they regarded as being too low.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Walter Edward Foster (Speaker of the Senate)

Liberal

Mr. SPEAKER:

Order.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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?

An hon. MEMBER:

Sit down.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CCF

Major James William Coldwell

Co-operative Commonwealth Federation (C.C.F.)

Mr. COLDWELL:

May I be permitted to conclude?

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Walter Edward Foster (Speaker of the Senate)

Liberal

Mr. SPEAKER:

With the unanimous consent of the house.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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?

An hon. MEMBER:

Go ahead.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Charles Avery Dunning (Minister of Finance and Receiver General)

Liberal

Mr. DUNNING:

Give the hon. member five minutes.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CCF

Major James William Coldwell

Co-operative Commonwealth Federation (C.C.F.)

Mr. COLDWELL:

I thank the house for that courtesy. What I want to ask is this: where now are all these protesters? If these protests are to be made effective, this is the place to do it.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
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CON

John Ritchie MacNicol

Conservative (1867-1942)

Mr. MacNICOL:

They are all under the woodpile now.

Topic:   THE BUDGET
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CCF

Major James William Coldwell

Co-operative Commonwealth Federation (C.C.F.)

Mr. COLDWELL:

The accuracy of no single newspaper report which I have quoted has been denied. Last August and September hon. members sitting on the opposite side were loud in their condemnation of the government's action. Where are they now? The hon. member for Kootenay East (Mr. Stevens) stated yesterday that he was astonished that members had not risen in their places to offer some criticism of the government's policies; and he proceeded to give reasons, which he thought were the true reasons, for that silence. I hope that the reasons which he gave are not correct. I should like to hear western members, particularly those on the Liberal side of the house, discuss this problem from the point of view from which they discussed it in the fall of last year. Are they going to allow what the people of western Canada believe to be a great betrayal of their interests to pass unchallenged by themselves in this parliament?

One last thing. It has been said on occasion that I am acting for some one else. Last year the chairman of the wheat board re-

The Budget*-Mr. Gladstone

ferred to me at least once as "Mr. McFarland's friend." I have never met Mr. McFarland, have never seen him, have never communicated with him by letter, telegram, or by proxy, and I would not know him if I met him on the street. Further, it has been said that I am acting on behalf of the wheat pools. May I say that I have had no communication with the wheat pools except when I have met officials casually, and the only letter I have had in months from them was the letter which probably other hon. members also received, giving information of a public nature. I am merely endeavouring to express on behalf of the people who sent me here the deep resentment they feel at the discontinuance of the wheat board method of marketing.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

John Gordon Ross

Liberal

Mr. ROSS (Moose Jaw):

The hon. gentleman read a list of different members from western Canada and said that they had protested against the action of the government. In the list there was more than one member whose name I heard read and who did not protest, although they went to these meetings. Surely the hon. member should be fair enough to point that out.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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?

Leslie Gordon Bell

Mr. COLD WELL:

That is perfectly correct, and if a member did not protest I did not say so. I read the protests of those who did protest.

Topic:   THE BUDGET
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LIB

Robert William Gladstone

Liberal

Mr. R. W. GLADSTONE (Wellington South):

It will be my purpose, Mr. Speaker, to deal in a constructive way with the broader aspects of Canadian economy. To do so I have decided to direct my remarks along two lines-first, the budget from the point of view of an Ontario city; and second, the consideration of constructive efforts to create and stabilize prosperity in Canada.

The latter I propose to divide under three headings: (a) elimination of over-government;

(b) economy and efficiency in administration;

(c) the creation of new wealth. Expressed otherwise my two main headings might be: (1) What we are doing, being the story of the budget and its interpretation; (2) What we might do, being the suggestions of a member who has been a rather silent observer in parliament.

The Minister of Finance (Mr. Dunning) delivered the budget two weeks ago to-day. The ground has been well covered in the debates during the intervening period. Newspaper comments express the opinion that many industries were not affected by the budget changes, but in my opinion it is doubtful whether there are many industries that have not been or will not be affected, and affected favourably, by the Canada-United States agreement of 1936 and the Canada-United 31111-106

Kingdom agreement of 1937. The point is that these agreements have been designed to give enlarged markets, three-way markets, local. British and United States, for our natural resources.

Prosperity on the farm is the best assurance of prosperity in industry. Increased purchasing power with the farmers in Wellington county will be reflected in a demand for the goods produced in the factories in the city of Guelph and in other towns and cities. It is the expectation, then, that more people will be employed both on the farms and in the factories as a result of these two agreements.

I do not propose to take time to discuss my next heading, namely, elimination as far as possible of over-government, since the Prime Minister (Mr. Mackenzie King) has announced recently that a royal commission will be named to study taxation and the division of financial powers and responsibilities. The scope of this commission, federally and provincially, was suggested recently quite comprehensively by the Canadian Chamber of Commerce to include the following purposes: (1) to clarify the interrelation of financing and taxing powers; (2) to survey duplication of public services; (3) to redefine legislative policies; (4) to establish administrative responsibilities. We can only await the recommendations of the royal commission and thereafter hope that the counsels of wise statesmanship, rising above petty politics, will prevail to establish relationships whereby duplication of services will be eliminated.

Economy and efficiency in administration: I realize I may here be treading on dangerous ground. This is a topic that will not be popular in a narrow political sense; I mean it will be unpopular in the sense of the remarks of the leader of the opposition (Mr. Bennett) on February 8. at page 683 of Hansard. The right hon. gentleman said:

There is not a general disposition on the part of all of us to see our friends, as distinct from somebody else's friends, deprived of the employment by which they earn their livelihood. We are all perfectly willing that somebody else's friend should leave his position, but none of us is prepared to think our own friend should.

It all depends upon whose ox is being gored.

The very nature of a consideration of the subject of economy in government carries with it definite personal risks and makes it necessary that I say at the outset that I am dealing with a system and not with individual cases. Should it be found that departments are overstaffed such circumstances can be corrected. I have reason to believe they

COMMON?

The Budget-Mr. Gladstone

are being corrected, through the effluxion of time, by transference and1 by marriage and death. I say, therefore, there is no need for anxiety on the part of faithful civil servants because of anything I may say. Rather, I suggest that the prospect for the promotion of capable people will be enhanced through improved efficiency of administration, And further, I am not critical of any cabinet minister, past or present, except in his capacity as a member of parliament. Responsibility in general must come home to private members who frequently, on the urging of electors, exert pressure for the expenditure of 850,000 when the purpose would be served adequately by the expenditure of 825,000.

I wish here to express the highest confidence in and admiration of our cabinet ministers of to-day, and likewise former cabinet ministers in this house, except, of course, as regards our differences in policies.

The object of my treatment of the subject is to bring about a better form of presentation to parliament of the estimates of money required for the ensuing year and to discover means of saving public money. I have been giving this matter consideration for many weeks and at one time thought of placing on the order paper for discussion a resolution in the following form:

Whereas, accumulated debt in Canada now constitutes a crushing burden upon the people and there is widespread criticism of the cost of government: and.

Whereas the estimates of proposed expenditures are submitted to parliament without adequate details; and,

Whereas the burdens of their respective departments and responsibilities of government in general impose a full time load upon the minister of each department; and,

Whereas there is very little opportunity between sessions of parliament whereby private members may in any organized way seek to discover wastages of money;

Therefore be it resolved that in the opinion of this house the government should establish a ministry of economy, with the object of saving money, of promoting efficiency, and, between sessions especially, of consulting with the ejected representatives of the people to further these objects.

It is suggested that this department should be organized on an economy basis, without ieputy minister or private secretary and looking to its discontinuance when it has served its purpose. It seemed best, however, that I should continue my study of the subject for a time in order to feel assurance of a more convincing, or perhaps invincible, argument, carrying with it some hope for definite action this session. I have discussed this subject with the Minister of Finance who will welcome any effort, soundly based, towards the discovery of means of promoting economy and efficiency

[Mr. Gladstone.}

in the service. I have found also in my visits to the Department of Public Works, the Department of National Revenue and the Post Office Department a recognition of need for greater cooperation and for an improved system, probably such as a rental charge for space used, to keep the space requirements within reasonable bounds commensurate with businesslike provision for the expectancy of expansion.

Search of the pages of Hansard over previous years reveals a long-time recognition of the fact that estimates have not been presented in a form to be understandable. Quoting from Hansard of June 9, 1928, at page 4,039, on the motion of Hon. J. A. Robb, Minister of Finance, that the house go into committee of ways and means, an amendment was moved by the then leader of the opposition (Mr. Bennett) to strike out all the words after the word "that" and to substitute therefor:

This house is of opinion that the expenditures for the year ending March 31, 1928, and the proposed expenditures for the year ending March 31, 1929, are excessive and extravagant and that the country has not received, and cannot expect to receive, any adequate returns therefrom.

This amendment was debated at some length and finally negatived, after a statement by the Prime Minister (Mr. Mackenzie King) concluding in these words:

Speaking for the government I would say that we would welcome a change in the present method, a change which would not only afford fuller opportunity for discussion but which would carry with it an obligation on the part of the heads of different branches of the public service to appear before a committee of the house and explain fully the reasons which have occasioned the recommendations which find their place in the estimates submitted to the house.

Having said this I would like to supplement my remarks further by saying that if we are not voted out of office as a result of this blanket amendment and if when another session comes around we still retain the confidence of the House of Commons, one of the first matters to which we will ask the house to give its attention and consideration will be the one mentioned by my hon. friend, namely that of arranging some method by which the estimates may to a greater or less extent be considered by a special committee or by the standing committees of the house.

The assurances of the Prime Minister of June 9. 1928, were carried out the next session as recorded in Hansard of February 14, at page 147 on a motion of the Prime Minister to consider the advisability of amending the standing orders so that certain estimates might be referred to a committee. This motion was referred to a special committee, and when the findings of the committee were reported to the house I find on page 461 the following interest-

16S1

The Budget-Mr. Gladstone

mg comment by the hon. member for Comox-Alberni (Mr. Neill):

. . . there is evidence of a tendency to divest this house of a certain portion of its responsibilities and to hand them over to other bodies, sometimes to the cabinet, sometimes to boards, and sometimes, as in this case, to committees.

The gist of the argument of the hon. member at that time was a protest against taking from parliament in any way the full right of discussion respecting the expenditure of money. Doubtless the same objection would be taken to-day, and quite properly so. to a committee on estimates, so that it behooves us to work out some other method by which economy' in the expenditure of money will be practised in parliament as it is in ordinary private and corporate enterprises.

In view of the criticism right across Canada of the cost of government I would urge that supplementary to the royal commission on federal and provincial relations, a definite start be made this year looking to the getting of something more nearly approaching one hundred cents in value for each dollar expended. We have opportunities every day to vote money to be expended; may we not be given an opportunity at this session to vote a modest sum to be devoted to a systematic effort to save money? Each session has witnessed a considerable amount of questioning by the opposition of the day to get at the facts. Apparently the procedure has been to give as little information as possible, and unless the opposition is alert the good henchmen of whatever government is in power sweep through without discussion votes for millions with their "carried, carried, carried." We accept the recommendation of the minister of the department; the minister himself must rely largely on the advice of his staff. With all deference to ministers, present or of the long past, as far as it is humanly possible for them to supervise personally, I am inclined to agree with the observation of one faithful and capable civil servant to whom I talked, that paid servants and not members of parliament to quite a degree control the purse.

The main estimates as submitted to parliament this session, asking for money, occupy in all ninety-five printed pages, including much white space. The Auditor General's report of the expenditures for the previous year occupies upwards of 1.200 pages, for the most part closely printed. Only those hon. members who have behind them a considerable background of parliamentary service and accumulated information can possibly know what it is all about, as millions are being voted. The system is inadequate and unbusinesslike.

I believe I have emphasized sufficiently not only the need but also the desire on the part

of parliament for many years for a better method of presenting and considering estimates. The question is how this can be brought about. The best suggestion I have had from any departmental head is for parliament to tear into some particular phase, and then the officials will endeavour to make corrections; the next year some other phase, and so on-a piecemeal sort of method. I am glad to note in the budget speech that the Minister of Finance has been giving some thought to this matter. I quote Hansard of February 25, page 1227:

The form of our estimates and appropriations, and the method of classifying accounts make it impossible to achieve precise accuracy in such calculations as those I am now placing on Hansard, and I hope that by another year we may be able to introduce such changes in our procedure regarding estimates and accounts as will make it possible to determine more accurately the real costs of the various important services of government. I think members of the house have long recognized the need for the change I suggest.

Speaking as a new and humble member of this house I venture to suggest that this whole matter goes far beyond what may be contemplated at present by the Minister of Finance. If it were only a matter of accountancy and the purely clerical routine of tihe assemblage of data and the tabulation of figures, I have no doubt we have in the departments now many who are competent for such work. But it goes far deeper, to the origin and justification of the proposed expenditure. It is a matter for instance, of enlisting the cooperation of all members in a plan for reasonable economy. All honour and praise is due the hon. member for Hal-ton (Mr. Cleaver) who, promptly after he was elected, cut almost in half certain proposed expenditures in his own riding. But if we fail to follow his example we will leave him looking foolish in the eyes of his electors for missing an opportunity to get Halton more deeply into the public trough. I have discovered a number of instances where the Minister of Public Works (Mr. Cardin) has cut costs, but I also know the pressure he has to resist both from members and in the way of extravagant specifications by departments.

Our economy, Mr. Speaker, is not a matter to be worked out by civil servants. It is a matter that requires much study by this parliament, and non-political cooperation. I find in other parts of the empire confirmation of the importance of detail in estimates. In Hansard of January 19, at page 100, I note the comment of the right hon. leader of the opposition, who said:

The Budget-Mr. Gladstone

paid dividends all through the depression perhaps they can afford to. Indirectly however I believe such a loss would more than be recouped in extra business transacted. I am sure the government would not lose on interest more than would be offset by sales taxes collected on increased business. I will admit that through speculative hazards of mining we would lose, but the loss brought about by many failures would easily be offset by the returns from one paying mine. It would be much better to lose in an effort to give work than to pour money down the sink-hole of relief.

Permit me now, sir, to summarize the suggestions I have been endeavouring to advance. The motor car manufacturers change models annually, but the record of efforts to improve the estimates confirms the suggestion that apparently politics is a handicap to the adoption of anything new. In parliament and out of it we hear much talk of future depressions, and almost a resignation to cycles as something inevitable. I would say that cycles only leave stranded the people in the cities, and wipe out their savings. We must make an adjustment whereby we may be able to achieve more nearly a level by taking from the peaks and filling in the valleys. This surely means reducing the sales tax before reducing the income tax. Overhead is too high in many places other than in government. We must get more nearly to a pay-as-you-go basis. Not only must we balance our budget, but we must reduce our national debt. I have confidence in the leadership of the Prime Minister and his cabinet. They stand for the promotion of trade with all nations, and I believe that therein lies the road to enduring peace.

Internally we need more speedy development of resources, and especially of our minerals. In conclusion may I emphasize that point. Even with some risks, pioneering is the way to progress. The first aeroplane flew only a few feet above ground, and for a very short distance. There is carved on the peace tower these words: "Where there is no vision the people perish." This is our challenge. Let us grasp the vision of greater possibilities and give to youth and to all who by birth or adoption claim Canada as their homeland, the opportunities that should be theirs, where ten million people possess a continental expanse of almost inexhaustible resources.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. A. M. EDWARDS (Waterloo South):

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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?

An hon. MEMBER:

There must be a reason.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

It is an obsession, not a reason. I admit at once that there are certain branches of the textile business that will have to do some explaining on the ground of overcapitalization and .so on, in the light of what has been brought out, but I do not agree that the textile business as a whole should be entirely condemned. There are certain branches of it that do need correcting, but the woollen and worsted business has never been found to be in that position.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CON

John Alexander (1874-1948) Macdonald

Conservative (1867-1942)

Mr. MACDONALD (Brantford):

The

report is not yet out condemning it.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

I am not paying attention to that report. The price spreads commission investigated the textile business thoroughly from end to end; every branch was under examination. What was the result? A clear sheet for the woollen and worsted business. Not only that, but after the 1932 agreements were signed-I believe it was a year later or perhaps two years, but one year at any rate-[DOT] when the representatives of the United Kingdom woollen industry came to Canada they put their case before the tariff board and argued that the duties imposed by the treaty were too high. Again, what was the result? The result was that they admitted that the duty on woollen and worsted yarns was only sufficient to equate cost of production as between the two countries, and that the duty on woollen and worsted cloth was inadequate to bring about this equation. That is the situation, and it makes no difference what we say about it. When we think of this branch of the industry and what it means to the different localities in which the mills are located, I suggest that a little more care should be taken in cricitizing the business. I seldom disagree with the hon. member for Selkirk (Mr. Thorson), but I do disagree with his suggestion that the textile business should be sacrificed in order to sell more wheat abroad.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB-PRO

Joseph Thorarinn Thorson

Liberal Progressive

Mr. THORSON:

I never made such a statement.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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March 11, 1937