April 21, 1939


On the orders of the day:


CON

Gordon Graydon

Conservative (1867-1942)

Mr. GORDON GRAYDON (Peel):

Mr. Speaker, I should like to direct a question to the Minister of National Defence (Mr. Mackenzie) who, I understand, issued a statement this morning substantiating the report that a submarine had been seen in Halifax harbour. Would the minister care to enlighten the house regarding the matter?

Topic:   NATIONAL DEFENCE
Subtopic:   REPORTED SIGHTING OF SUBMARINE IN HALIFAX HARBOUR
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LIB

Ian Alistair Mackenzie (Minister of National Defence)

Liberal

Hon. IAN MACKENZIE (Minister of National Defence):

Mr. Speaker, I am afraid my hon. friend is somewhat in error with regard to the matter of the release to the press this morning. The facts are as follows. Reports were received by naval authorities at Halifax yesterday from a pilot vessel that officers of the vessel believed that a submarine had entered Halifax harbour early on Wednesday morning. Immediately a most thorough investigation was conducted by the officers of the Royal Canadian Air Force, the Royal Canadian Navy and the Royal Canadian Mounted Police. At this time I may tell my hon. friend that the opinion of the officers is that the vessel in question was not a submarine. However, as soon as I have further reliable information I will give it immediately to the house.

Topic:   NATIONAL DEFENCE
Subtopic:   REPORTED SIGHTING OF SUBMARINE IN HALIFAX HARBOUR
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UNEMPLOYMENT RELIEF


UNEMPLOYMENT AND AGRICULTURAL DISTRESS__


UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES


Hon. NORMAN McL. ROGERS (Minister of Labour) moved the second reading of Bill No. 96, to assist in the alleviation of unemployment and agricultural distress.


LIB

Walter Edward Foster (Speaker of the Senate)

Liberal

Mr. SPEAKER:

Is it the pleasure of the house to adopt the motion?

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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CON

Charles Hazlitt Cahan

Conservative (1867-1942)

Hon. C. H. CAHAN (St. Lawrence-St George):

Mr. Speaker, I had supposed the Minister of Labour intended to address the

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house, and I was waiting for him to speak.

I wish .to discuss certain matters on the motion for second reading, because I believe the observations I shall make are perhaps more appropriate on second reading than they would have been on the resolution which preceded the bill.

The national employment commission found in their report of January, 1938-which I think should be read and digested by all who are interested in the subject of unemployment in Canada-.that in addition to those in need of agricultural relief, there were in the month of September of the previous year, 450,000 persons in Canada in receipt of aid, assistance or relief, to which the dominion government contributed, of which 290,000 were classed as dependents, including babes in arms, mothers, grandmothers, grandfathers, who could not possibly work even if jobs were available; while 42,000, by reason of physical deficiences or mental frailties, were reported as unemployable, leaving 115,000 persons who were employable if work, suitable to their several capacities, had been made available. Certainly in the administration of relief measures these several categories must be considered separately, and the relief which is granted must be adequate to the necessities of the persons in the respective categories.

I have found in my own experience in dealing with many of those young men who apply to me, as a member of parliament, for advice and assistance, that when industry revives, openings are increasingly available for hundreds and even thousands who have such skill and training as qualify them for employment in industry, but that few of the unemployed have had manual training for industrial employment, which leads me to conclude that a considerable part of existing unemployment is not due-as so many recklessly assert- to the faults of the so-called capitalistic system, but rather to the abandonment of an adequate system of apprenticeship in the mechanical trades, which formerly prevailed, and to deficiencies which have arisen in our educational system, in so far as it fails to qualify our youth for available industrial employment. I must reserve any discussion of the subject of suitable preparation for employment, because to-day I wish merely to discuss certain constitutional aspects of the social problems.

During the past year the public press has borne witness to an insistent and increasing demand that the federal treasury shall assume entirely the costs of unemployment relief, and so relieve the provincial, civic and municipal treasuries of all expenditures which are

made for that purpose. This demand is made chiefly by provincial, civic and municipalauthorities, who assert that their existingrevenues are inadequate to meet the demands made upon them, and tha/t the imposition of increased provincial, civic and municipal taxation, to increase their revenues for purposes of relief, would be resented by the people whom they . represent. They claim that they have already exhausted their financial resources and that an increase of the burdens of provincial, civic and municipaltaxation is practically impossible.

On the other hand, these burdens cannot be assumed by the federal treasury without a corresponding increase in federal taxation, and, in any case, an increased burden of federal taxation will fall heavily upon the same people, despite the fact that they may reside in different provinces, or in different cities or towns or rural municipalities.

As the municipalities, whether civic or rural, are creations of and under the exclusive jurisdiction of the provincial governments and provincial legislatures, the question at once arises whether the dominion parliament or the provincial legislatures should assume the responsibility of imposing increased taxation for the relief of the unemployed and the indigent. This is a question for fair, full and frank public discussion.

It is our duty therefore to consider whether under the existing constitution of this country the parliament of Canada may lawfully impose federal * taxes and lawfully enact laws appropriating the revenues derived from federal taxation for the relief of the unemployed and the indigent. If it is decided that the permanent relief of the indigent and unemployed is the sole duty and responsibility of this parliament, then I sincerely believe that this parliament will not hesitate to resolve the problem, and that it is quite capable of so doing.

I have frequently discussed in this house and elsewhere the validity of dominion legislation, which has been proposed for the solution of the social problems which have beset this country. As a member of the late government of Canada and as a member of the parliament of Canada, I have voted in favour of the enactment of such measures as were proposed to assist in alleviating the distress and suffering resulting from poverty and unemployment, such as appropriations for old age pensions, appropriations for the relief of the indigent, and such legislation as the Weekly Rest in Industrial Undertakings Act of 1935, the Minimum Wage Act of 1935, and the Employment and Social Insurance Act of 1935, although on previous occasions, in view of outstanding decisions of the judicial

Unemployment and Agricultural Distress

committee of the privy council, I had frankly expressed my personal doubts as to the constitutional validity of several of these proposed enactments. Several of these statutes were, in January, 1937, declared by the judicial committee of the privy council to be beyond the legislative jurisdiction of the dominion parliament and therefore illegal, invalid and of no effect.

It is, I think, generally admitted that in construing the terms of the British North America Act, the authority of the judicial committee has at times been perversely exercised, but nevertheless the decisions of the judicial committee in constitutional cases, must, under existing conditions, be regarded as having the same force and effect as if they were expressly incorporated into the terms of the British North America Act.

It is clear, therefore, that there are many things that the parliament and government of Canada may not lawfully do, and which, if attempted, are as unlawful and in fact as reprehensible as any attempt by private individuals to violate valid statutes which have been enacted by a competent parliament or by a competent legislature. In a recent decision the judicial committee has definitely declared that:

Assuming that the dominion has collected by means of taxation a fund, it by no means follows that any legislation which disposes of it is necessarily within dominion competence. It may be legislation affecting the classes of subjects enumerated in section 92 (of the British North America Act) and, if so, it would be ultra vires. In other words, dominion legislation, even though it deals with dominion property, may yet be so framed as to invade civil rights within the province or encroach upon the classes of subjects which are reserved to provincial competence. If on the true view of the legislation it is found that in reality in pith and substance the legislation invades civil rights within the province, or in respect of other classes of subjects otherwise encroaches upon the provincial field, the legislation is invalid.

The legislation referred to in that decision was legislation by this parliament appropriating its revenues for the purpose of unemployment insurance. That decision of the judicial committee has, in my opinion, raised grave doubts as to the validity of any enactments hitherto or hereafter made by the dominion parliament which purport to make appropriations of dominion funds for unemployment relief or for the support and care of the indigent in the several provinces of Canada. I respectfully suggest that it was the duty of the government to have procured within the past eighteen months definite opinions from the judicial committee as to the duty and responsibility of the dominion government and parliament in respect of these matters.

Week after week we read in the press official pronouncements of provincial and municipal governments that the British North America Act imposes upon the federal parliament the sole responsibility in these matters, and, as frequently, dominion ministers and officials reply in the negative. The supreme court of Canada and the judicial committee of the privy council should, in my opinion, long ere this have been requested to decide definitely for what social services or relief purposes the revenues which the dominion government obtains, by taxation of the people in one form or another, may be lawfully appropriated by parliament.

Section 102 of the British North America. Act, 1867, has enacted that "all duties and revenues" of Canada-

-shall form one consolidated revenue fund, to be appropriated for the public service of Canada in the manner and subject to the charges in this act provided.

Sections 103, 104 and 105 provide for certain specific charges upon the consolidated revenue fund. Section 106 enacts that "subject to the several payments by this act charged on the consolidated revenue fund of Canada," to which I have referred, "the same" that is, the consolidated revenue fund of Canada, "shall be appropriated by the parliament of Canada for the public service."

The British North America Act, 1867, therefore enacts as one of its fundamental provisions that the parliament of Canada shall make appropriations from its consolidated revenue fund only for the public service of Canada, and that act does not provide or even imply that the parliament of Canada may lawfully appropriate the revenues of Canada for any object or purpose other than the public service of Canada. On the other hand, section 126 of the British North America Act enacts that such duties and revenues:

-as are by this act reserved to the respective governments or legislatures of the provinces, and all duties and revenues raised by them in accordance with the special powers conferred upon them by this act, shall in each province form one consolidated revenue fund to be appropriated for the public service of the province.

The British North America Act, therefore, clearly distinguishes between the public service of Canada and the public service of the province. That act also distinguishes between the revenues of the dominion, which form the consolidated revenue fund of Canada, and the revenues which in each province form the consolidated revenue fund of that province. It also imperatively provides that the consolidated revenue fund of Canada shall be appropriated 'by the parliament of Canada for the public service of Canada, and that the

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consolidated revenue of each province shall be appropriated by the legislature of that province for the public service of that province. It would appear, therefore, that the British North America Act contains a clear implication that it is not lawful for the parliament of Canada to appropriate the revenues of Canada for the public services of the provinces, or for the legislature of a province to appropriate the revenues of that province for the public service of the Dominion of Canada.

I do not desire to argue the legal and constitutional issues to-day, but merely to indicate their nature and extent, as they appear to me.

But how may we ascertain what matters are included in the public service of Canada, and ivhat matters are included in the public service of the province? It is clear that no revenues of Canada may be lawfully appropriated except by a valid law enacted by the parliament of Canada, and that no revenues of the province may be lawfully appropriated except by a valid law enacted by the legislature of the province. Section 91 of the British North America Act enacts that it shall be lawful for the parliament of Canada:

-to make laws for the peace, order and good government of Canada, in relation to all matters not coming within the classes of subject by this act assigned exclusively to the legislatures of the provinces;

During the last Conservative regime, the government of which I was a member annually asked parliament to appropriate large sums from the consolidated revenue fund of Canada for unemployment relief as extraordinary or emergency legislation under the " peace, order and good government " clause. The sums so voted were assumed by us to be valid federal appropriations under the " peace, order and good government" clause which I have just quoted, on the theory that the unemployment problem in Canada had reached such extraordinary dimensions as to become a threat to the body politic of the dominion, and was therefore a matter of peace, order and good government, properly to be dealt with by the dominion parliament. But the judicial committee of the privy council has summarily rejected this theory in a more recent decision.

I do not know, as it has not been definitely declared, on what basis our annual appropriations for relief and kindred social services are now made, or on what constitutional theories they are deemed to rest.

But, inasmuch as the provincial legislature may exclusively make laws in relation to the establishment, maintenance and management of hospitals, asylums, charities and eleemosy-

nary institutions for the care and relief of those who are poor or destitute of the means of comfortable subsistence, it is contended by some authorities that laws appropriating public funds for the maintenance and relief of the indigent, the aged and the unemployed in each province, are now exclusively within the legislative jurisdiction of the provincial legislatures, and therefore beyond the powers of the parliament of Canada. If this contention is upheld by the courts, then this parliament has been exceeding its authority and has made and is continuing to make unlawful appropriations.

I am not endowed with the gift of prophecy, but I am disposed to think that whenever the issue arises in the courts, as it will undoubtedly be raised in due time-and, as I think, any individual taxpayer of the country, who is prepared to appropriate his own private funds for such litigation, may raise it at any time-the judicial committee will probably decide that any appropriations of dominion funds for the construction of roads, bridges, canals or other local works, which are wholly situate within the province, are unlawfully made and invalid.

Before attempting any radical change in the fundamental constitutional law of this country we must realize that our constitution is the stable basis of our existing political, civil and religious liberties, and that if these liberties are to be maintained, the law of the constitution must be respected and strictly obeyed, until, as I have said, it is amended and modified by judicial interpretation or by other lawful methods and with general public approval.

It is, I conceive, the duty of a member of parliament to contribute what he can to the public welfare by frankly speaking the thoughts which have matured in his own mind, and not merely what he thinks his constituents will approve. He is a representative of his electors, and not merely their delegate. The electors, in their turn, will, in due time, by the exercise of their electoral franchise, approve or disapprove of his political activities.

In the provinces of the middle west, especially in the province of Saskatchewan, the farmers have suffered from a prolonged drought, which, has obliged farmers and their dependents to the number of about 300,000 to seek financial aid from the government. Such aid to agricultural districts, to overcome the effects of drought, is as commendable as in any other case, where cyclones, earthquakes, floods or other exceptional natural disturbances have caused sudden death and suffer-

Unemployment and Agricultural Distress

ing. Differences pf opinion may arise as to terms and conditions of appropriations made by parliament to aid agriculture. Differences of opinion arise with respect to the adoption and effect of any public policy. But it is my personal opinion that grants from the dominion treasury of agricultural aid to the western farmers, in times of dire distress, may lawfully be made, because section 95 of the British North America Act has declared that "the parliament of Canada may from time to time make laws in relation to agriculture in all or any of the provinces."

So also, in the case of distress and suffering among those engaged in the fisheries of our sea coasts, the parliament of Canada may sometimes lawfully intervene; for our constitution declares that the parliament of Canada has exclusive jurisdiction to make laws in relation to all matters coming within the class of subjects in the British North America Act described as "sea coast and inland fisheries."

I interject these opinions to indicate that 1 am not personally opposed to the making by this parliament of reasonable appropriations to assist either the farmers or the fishermen of Canada.

There can be no doubt that it is the duty of either the dominion or the provincial government to make due provision for indigent persons who are unable by reason of age, infirmity or physical or mental incapacity to provide for themselves. But as governmental authority is divided in Canada by the express terms of our constitution, grave doubt has arisen as to whether the federal parliament and the federal government have the responsibility and duty to make such provision. I, therefore, suggest that it is the duty of the government of this dominion to ensure that such doubts are resolved as speedily as possible, so that, by reason of existing constitutional difficulties and disputes, relief may not be withheld from those who are entitled to receive it.

I am clearly of opinion that, in order to resolve all existing doubts, the dominion government should speedily refer to the Supreme Court of Canada, subject to the ultimate review of the judicial committee, any constitutional issues which remain in doubt, so that it may be decided beyond dispute what, if any, remedial measures are within the legislative jurisdiction of the dominion parliament, and what remedial measures are within the exclusive jurisdiction of the provincial legislatures.

Unless these doubts are now removed by definite decisions of the judicial committee, which may speedily be obtained, then the

present appropriations of dominion revenues for the maintenance of these social services should not be indefinitely renewed or continued beyond the time necessary to obtain final judicial decisions upon the issues involved. In the absence nf such decisions, the entire burden of their maintenance may not be lawfully assumed unless and until the parliament of the United Kingdom has enacted such amendments to the British North America Act as will clearly authorize the parliament of Canada to do so lawfully, and to this end the consent of the provincial governments is advisable, if not necessary.

The government and parliament of Canada may not, without mischievous results, continue to make unlawful appropriations for objects which the courts have already declared, or may reasonably be expected to declare, to be beyond the legislative jurisdiction of parliament. The governments, parliaments and legislatures of this dominion may not set the example to individual malefactors of disregarding and violating the fundamental law of the constitution which is now in force and which limits and controls their several actions.

My conclusion, therefore, is this, that those throughout Canada who are persuaded that the pressing social problems of the day may best be solved by the parliament of Canada taking over the duty of making appropriations of dominion revenues for such purposes- appropriations which may be lawfully and efficiently administered 'by the government of Canada and its proper agencies-are in duty bound to procure the cooperation and consent of provincial governments to the enactment of such amendments to the British North America Act as will clearly vest these matters in and under the legislative jurisdiction of parliament and the administrative jurisdiction of the government of Canada.

But, in the meantime, until such amendments to our constitution may be obtained by consent of the provinces, it is the duty of the government to obtain from the supreme court and from the judicial committee decisions as to the legislative authority of this parliament and the constitutional responsibility of this government.

It seems to me that it is nothing less than a public scandal that the provincial and municipal authorities should persistently declare in public utterances and in the press that it is the lawful duty of the dominion to assume the sole responsibility of providing financial relief for the unemployed and the indigent, and that the dominion authorities should as persistently deny these utterances. The issue should be judicially determined, and, until such issues are finally decided by

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the courts, the public mind will remain confused and uncertain in its judgments, and it will be impossible for either the dominion parliament or for the provincial legislatures to proceed intelligently and with resolution and energy, to effect the satisfactory solutions which are necessary to ensure our public welfare and our domestic safety.

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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LIB

Arthur Graeme Slaght

Liberal

Mr. SLAGHT:

I do not rise to continue the debate at this stage, but if the hon. member who has just spoken (Mr. Cahan) and who in my view has delivered a scholarly and closely reasoned contribution to the discussion, would permit me to ask a question, I should like to do so. Is it his view that the dominion government has not at this time power directly to appropriate and disburse money for unemployment relief? I take it that the affirmative correctly expresses his view, but lest I should be mistaken I ask him if he will tell me.

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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CON

Charles Hazlitt Cahan

Conservative (1867-1942)

Mr. CAHAN:

I do not think this is an appropriate time to ask and answer questions on a subject of the kind; it would be better to do so in committee. But I do say this, that under the British North America Act as it was originally drafted and as it was interpreted for the first twenty or twenty-five /ears of confederation, it would be lawful for he dominion government to make appsopria-ions under the " peace, order and good government " clause for social purposes, including relief. Under the British North America Act as it is to-day construed and applied by the judicial committee of the privy council, I cannot see how it can be lawful for the dominion parliament to make such appropriations. Mind you, I make the distinction between what I believe to have been the clear intention and purpose of those who drafted the British North America Act, and the decisions which were subsequently made with respect to the " peace, order and good government " clause..

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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LIB-PRO

Joseph Thorarinn Thorson

Liberal Progressive

Mr. THORSON:

Mr. Speaker-

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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LIB

Walter Edward Foster (Speaker of the Senate)

Liberal

Mr. SPEAKER:

If the hon. member wishes to put a question, I think it would be better to wait until the house is in committee.

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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LIB-PRO

Joseph Thorarinn Thorson

Liberal Progressive

Mr. THORSON:

It seems to me that the hon. member for St. Lawrence-St. George (Mr. Cahan) has departed from his usual logical presentation of a problem. My recollection is that two years ago he castigated very severely the judicial committee of the privy council for its judgment in respect of the unemployment insurance case; he characterized it as being perverse and contrary to principle. If that is so, what logic is there in sub-(Mr. Cahan.]

mitting to the same tribunal the question which he now suggests? I agree with his latter suggestion, that if there is any doubt as to the right of this parliament to appropriate moneys for unemployment relief and for social purposes, such doubt should be resolved by appropriate amendments to the British North America Act.

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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CON

Charles Hazlitt Cahan

Conservative (1867-1942)

Mr. CAHAN:

Would the hon. member

allow me to ask him a question?

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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LIB-PRO

Joseph Thorarinn Thorson

Liberal Progressive

Mr. THORSON:

Just a moment. We have appointed a royal commission to go into a number of matters, to review the fields of responsibility, sources of taxation, sources of revenue. Would it not be much more sensible to wait until they have brought down their report? Then, if there is any doubt as to the jurisdiction of the dominion parliament to appropriate moneys for unemployment relief or other social purposes, the whole thing could be discussed. To do this would be much more logical than to make an immediate reference to a court which the hon. member has already characterized as a perverse court.

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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CON

Charles Hazlitt Cahan

Conservative (1867-1942)

Mr. CAHAN:

Mr. Speaker, would you

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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LIB

Walter Edward Foster (Speaker of the Senate)

Liberal

Mr. SPEAKER:

Is it the pleasure of the house to adopt the motion?

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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CON

Charles Hazlitt Cahan

Conservative (1867-1942)

Mr. CAHAN:

Mr. Speaker, may I be

allowed, by consent of the house, to make a few comments? I withdraw nothing I have said with regard to certain decisions of the judicial committee. But the fact is that those decisions are written into our law and to-day are as much a part of the British North America Act as if they had been expressly included in that act at the time it was enacted. But there is a further issue, and I will state my own experience. I go about the province of which I am one of the representatives, and I am met everywhere, on every hand, by the declarations, from the provincial premier and provincial ministers down to nearly every mayor and member of the municipal councils in that province, that they are instructed and believe that it is the duty of the dominion parliament and government to assume sole responsibility for these expenditures. I go into the province of Ontario, and although I am not so well acquainted there, I hear reports that members of the present provincial government in Ontario, and the mayors of some of these cities-important and intelligent men who exercise authority in municipal matters- declare that they regard it as the sole Responsibility of the dominion parliament to provide and distribute funds sufficient for relief purposes.

Unemployment and Agricultural Distress

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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LIB

Walter Edward Foster (Speaker of the Senate)

Liberal

Mr. SPEAKER:

Order. I do not want to interrupt the hon. gentleman, but he will have an opportunity to discuss the matter more fully when the house is in committee.

Topic:   UNDERTAKINGS IN GENERAL INTEREST AND FINANCIAL ASSISTANCE TO PROVINCES
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April 21, 1939