November 4, 1941

SC

Ernest George Hansell

Social Credit

Mr. HANSELL:

My hon. friend is a good Liberal; perhaps he does not have any trouble, but the rest of us do. What I am saying is that such a gesture on the part of the government would stimulate confidence in our all-out war effort. Answering my hon. friend's question, let me tell him that when the special parliamentary committee on war expenditures was sitting I brought the matter up in that committee. When we, as members of the committee, Whose duty it was under the terms of reference to recommend to the government where economies could be made, asked for a pass to permit us to go wherever we wanted we were told that would not do, that we could not get such a pass-

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CON
SC

Ernest George Hansell

Social Credit

Mr. HANSELL:

Now there is criticism, we hear it on every hand, that the game of politics is being played in connection with our war effort.

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?

An hon. MEMBER:

It is not so.

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SC

Ernest George Hansell

Social Credit

Mr. HANSELL:

All right. If that criticism is a lie that lie should be nailed, and nailed so hard that it will never live again. There is no better way to nail that lie than for the people's representatives to be given absolutely free course in this country. We do not ask to know the nation's military secrets, but we do say that when the people of this country are spending billions of their own dollars they have a right to expect their own representatives to have free course in knowing where and how their money is spent.

I wonder whether the people of Canada are satisfied that Canada is putting forth its maximum war effort. I do not think so. In the statement made by the Prime Minister yesterday he said these words in referring to the war and nazi aggression: "Every conceivable means by which freedom can be crushed is to-day 'being employed by nazi Germany." We believe that, we know that. We would have known it had the Prime Minister not said it. But how much better would it have been if the Prime Minister had changed one or two words there, if he had been able to say, "Every conceivable means by which freedom can be preserved in the world is

to-day being employed by the people of Canada." I know that it has been no easy task for this government-or any government as far as that goes-when war broke out to start at scratch and get the whole country organized for a total war effort. It has been a big task. But now over two years have passed away. Why did we have to start from scratch when war broke out? The answer is very easy: we were told in the preceding years that we had no money. It should be noted that in those pre-war days the heads of our government were forced by their financial ties to allow conditions to drift through the years of destitution with belt-tightening in the midst of plenty as a declared policy; thus there was utter failure to solve those pre-war problems. To our tremendous discomfort they are continuing with the same policy and the same financial ties blunderingly to wage war against Germany. I find the feeling abroad in Canada that we are tinkering with our war effort. That may be denied in some circles, but many people to whom I have talked believe it. For instance, the calling upon school children to take their candy money to school so that every few days the class can buy a war savings stamp is nothing to be proud of.

Recruiting is a very live subject to-day, it was referred to this afternoon by the leader of the official opposition. It is not much to be proud of having officials go through the country gathering together staff officers and other prominent citizens, throwing a banquet, and then giving them a kind of sales talk as to how to get men in the army. We are supposed to be fighting an all-out war. As I stood on the street corner of a certain city not many months ago, a recruiting campaign was going on; there was a little stage set up on the street; a band was playing; some speeches had been made, and the young folks were having a dance on the street. A spotlight was playing upon those who were dancing; that spotlight was thrown upon a young chap in civilian clothes who was dancing with his girl friend, and from the loud speaker came some suggestion to this young chap about enlisting in the army. I say that such tactics in the endeavour to mobilize this nation for an all-out war effort are nothing to be proud of.

A little over a year ago we had a national registration. The people thought we were really getting down to business. At that time it was believed that we were to register everyone, so that each could serve in his rightful place. To my mind that was just a million dollars practically wasted. The country really responded; various organizations, young people's societies, soldier organizations, service

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clubs and even church organizations throughout the country gave freely of their time and energies during that registration. But what did we get for it? It is true that we answered a number of questions, one of which was "Can you milk cows?" Well, there is one satisfaction; we know how many men and women in Canada can milk cows. I wonder whether we know exactly how many mechanics there are in Canada to-day, and where they are.

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SC

Ernest George Hansell

Social Credit

Mr. HANSELL:

Well, there should be; during the last ten years we had plenty of time to train them. Do we know how many welders there are in Canada to-day, and where they are? Do we know how many chemists and engineers there are in Canada? Do we know where they are, so that we could go to them and say, "Here is a job waiting for you. Do you think you can serve your country better by taking it? We will pay you a fair salary." I wonder whether we could do that, as a result of that national registration. Last session I heard someone-I think it was a member of the government, although I am not sure of that-declare that we did not have the skilled workmen we should have in this country. I believe that should be considered a disgrace to a government that was in power for the ten years preceding the war, when young men as well as older men were without employment and could have been trained to be of service during the war which at that time was impending.

Over two years have passed since the outbreak of war. Soon after the war began we passed what was known as the National Resources Mobilization Act. At that time this group fought in this house for the mobilization of the whole country in a total war effort. We said the first thing that should be mobilized and used, so that there might be no restriction on our production, was the banking system of this country. Hon. members will recall that at that time we offered an amendment suggesting that the Bank of Canada should perform its proper function in supplying the necessary means of payment, so that the government should not be restricted in its war effort. At that time we were told by the Prime Minister that the amendment was not really necessary, because it was already embodied in the bill. We were told that the mobilization of material and human resources meant also the mobilization of the financial resources of this country. Well, Mr. Chairman, I wonder whether that is true. I say, I think, without fear of contradiction, that there has been no change whatever in

the banking policy of this country since the beginning of the war. Banks are still creating credit as they did before the war and as they have always done; and they are creating it as a debt to the nation, with added interest.

Speaking of an all-out war effort, I said that I was conscious of the fact that it was a tremendous task to organize this country for a total war effort, and I am going to commend in some small degree the work that has been done in the past two years by some members of the government. But we cannot say to-day, even after two years have gone by, that Canada is experiencing a total war effort. The other day I picked up a newspaper, but before stating what I read in it let me suggest that the bureau of information, which is under the sponsorship of the government, should be just a little more clever. I do not believe our propaganda machine, if I may call it that, is working effectively. The headline in this newspaper stated that the Germans were within seventy-five miles of Moscow, that they were hammering at the doors of that city. I turned over the pages of the paper and noticed an announcement by the bureau of information that the Minister of Munitions and Supply had said we were now making tanks in Canada, and that we hoped to be able to supply at least one hundred tanks to Russia by Christmas. Here were the Germans hammering at the doors of Moscow, and our total war effort for two years had brought us to the point where if the Russians were able to hold out until Christmas, we hoped to be able to supply them with one hundred tanks. I say that even though the government had to start from scratch when this war commenced, very much more could have been done if this whole problem had been tackled by mobilizing the resources, particularly the financial resources, of this country. When I say that, I mean that this group, as should be well known by now, has in mind the mobilizing of our banking institutions so that there may be no restriction whatever on our war effort; and I am confident that if this had been done our experience would have been vastly different.

Instead of that we find our people to-day wondering whether or not they are justified in fighting to make rich men richer. We speak of bonusing industry and of bonusing labour. I have no particular objection to that. I do not believe anyone could have anything to say against the labourer getting paid in proportion to the increase in the cost of living.

Speaking of recruiting, we have heard nothing about the dependents of soldiers being equally bonused on account of the rise in the

The War-Mr. Hansell

cost of living. If we are to call upon our young men to volunteer for service, we must show them that they will get a fair and square deal in Canada, one commensurate with the deal everybody else gets. We have heard nothing about the bonusing of soldiers' wives and soldiers' mothers, or other dependents.

In our travels we have heard something about the word "conscription." I do not like the word. Nevertheless it is one that is being used, and used more extensively in some parts of the country than in others. I read in the press the other day where even the leader of the official opposition had referred to conscription. This article, which appeared1 in a Winnipeg paper, was headed, "Hanson says public, not political party, may ask conscription." Then, in the article the leader of the opposition is reported to have said:

I have studied it from every angle. If it were put to a plebiscite I do not know what would happen.

I do not think it is going to be put to a plebiscite. If it were put to a plebiscite I would suggest that all parties be called in to discuss what the people were voting for. I would suggest that they be asked something like this: "Do you believe that the maximum war effort can be reached by the conscription of man-power for overseas service, if at the same time we do not conscript the banking system of Canada?" I think I know what the answer would be. Or, we might say, "Are you in favour of the conscription of Canada's manpower for military service, without first conscripting the banking institutions to create and provide the necessary means of payment?" I think I know how the people would vote on a question framed in those words.

Let me suggest something quite fundamental to the success of our war effort. It is all very well to talk about the mobilization of material resources. It is all very well to talk about the securing of raw materials. It is all right for the government and others to talk about getting the country organized for a total war effort. But there are other vital points which must be taken into consideration and, in my opinion, the most vital factor of all is the Canadian people.

I am going to suggest that there are two points which are most vital. First, the nation must know the seriousness of the situation. Yesterday the Prime Minister attempted in some degree to show the seriousness of the situation. But it cannot be described in high-toned or platitudinous phrases. They must know the danger, and must realize how close these dangers are. Second, the people of Canada must realize that the things we possess are worth fighting for. I do not believe that a

large proportion of our people realize this point fully, and I am going to suggest that there is a reason for that situation. It seems to me that the people are asking whether or not they are fighting for a new order. I believe the government is all wrong in the psychological foundation of its presentation of this matter to the people of Canada.

What does the government talk about? Government officials come round telling us to prepare for the aftermath of the war. They tell us that after the war we may have to come down to a lower standard of living-a tighten-your-belt policy. They tell us that after the war they hope the national income will be large enough to warrant paying off our huge debts. The question the people of Canada are asking is whether we are fighting for a new day or the return of an old day. This afternoon the hon. member for Vancouver East talked about comments he had heard while travelling east on a railway train. All hon. members have heard similar comments. I heard one young soldier say that when the soldiers came back they were not going to lay down their guns until they were perfectly sure they were coming back to a Canada worth living in. I did not say anything to that young man; I believed that perhaps his statement was a sort of idle boast. But that is what young men are thinking about.

On another occasion when I heard one of the young men of my acquaintance speaking in that way, I said, "Now, young fellow, do not fool yourself, because those who are at the helm to-day are telling the people of Canada to prepare for economic disaster after the war." I said, "When you come back you will be in the very same position as the soldiers who returned from the last war." I said I was old enough to remember with intelligence what was said at the time of the last war, and to remember that the soldiers who fought in that war said the same thing.

But what happened? We all know what happened. I say that if fundamental changes in our economic system are not made before the war is over, this nation will be plunged into a state of despair similar to that through which it has passed in the last ten years. That is the natural result of the present economic arrangement.

The government is continually reminding the people of possible post-wrar stringency. Only the other day the director of public information came out with a similar statement. That sort of thing is no good. We have to fight for something worth fighting for. We know what freedom means. But to many men freedom does not mean as much as it does to some of us. We recall what happened a few years ago when the men boarded the

The War-Munitions and Supply-Mr. Howe

train at Vancouver in an effort to come to Ottawa to present their grievances to the government. We know, too, what happened at Regina. It seems to me that the young men of that day were fighting for a freedom; they were fighting for economic freedom. They were not fighting with clubs or guns, they simply came down here to interview the government and to see what could be done. There has been no change in our system, and the results after the war will be the same as what we have been going through for the last ten years. Fundamental changes must be made.

Before I resume my seat may I say that I hope before leaving here we shall be given some definite statement as to what is being done now to meet post-war eventualities. It is all right to be told that we are fighting against something, but we should be told what we are fighting for. It is not enough to say that we are fighting for our freedom, and it is not enough to talk about getting jobs for our soldiers. I notice the Minister of Pensions and National Health is in his seat. He is at the head of a government committee which has been appointed to investigate postwar problems. The Liberal party is not only trying to run the war, but trying to determine how the world should be run after the war. I suggest that there are a good many men in this country who are outside the Liberal party and who could say something about how things should be handled in preparation for the post-war period.

The Minister of Pensions and National Health was in Toronto the other day, and according to newspaper reports he spoke quite enthusiastically about getting jobs for soldiers after the war. Once or twice he used the phrase "rehabilitating soldiers after the war." I find it hard to believe that a government which could not find jobs for men before the war will be able to find jobs for men after the war is over. In other words, if they can assure men of jobs after the war, why could they not have legislated so that men could have found jobs before the war? It is not just a matter of finding men jobs; it is a matter of so readjusting our whole economic democracy that men may have economic freedom and be able to produce and consume what they produce.

The government which was in power before the war was not able to find jobs for men, 'but they are now proposing that after the war jobs will be found. I say that when the Minister of Pensions and National Health goes up and down this country he should tell Canada how he is going to do that. Even our own people have not been told what good

alternatives we have to the bad pre-war policies. Until we get a good alternative we shall be merely tinkering with our post-war problem. If our policy is, first, to defend the world and then to develop and organize the freedoms-I say "freedoms" not "freedom";

I mean all freedoms, including economic freedom-we ought to make up our mind as to how we mean to do this and then tell the world about it.

Someone has well said that democracies do not perish at the hands of an external conqueror, that they fall because they are insecure from within. Let us have a democracy that does not end with the ballot-box; let us have one that will actualize those things which people desire. Can we say that we have had a true democracy in this country for the past ten, fifteen or twenty years? Can we say that in those days preceding the war we had a true democracy? Can we say that our people were receiving what they desired? Can we say that the people desired relief rolls? Can we say that the people desired destitution and poverty? Certainly they did not desire those things.

If democracy means anything, it means the people's right to elect a government that will so manage the country that their desires will be filled. That is true democracy. Speaking in London the Prime Minster said that something must be done now to meet post-war eventualities. I agree with him. But he did not say what had to be done. This group dares him to say how this present arrangement can be adjusted in order that democracy may function to the maximum extent or how this system can be changed to deal with the post-war problem.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Hon. C. D. HOWE (Minister of Munitions and Supply):

Mr. Chairman, in reporting to hon. members on the current position of Canada's munitions programme, my task is much less difficult than in making earlier reports. Then, many of our largest projects were in the construction and tooling up period; now, most of our large projects are in at least partial operation. Then, my report, necessarily to some extent, dealt with anticipated production; to-day I can confine my remarks to actual production, and at the same time give to hon. members a fairly comprehensive view of our munitions programme.

In his remarks this afternoon the leader of the opposition (Mr. Hanson) invited me to be frank with the house as to the actual state of our production and to give the house the fullest possible information on that subject. I propose to do that subject to the limitations which he himself said he had found to be

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necessary. I am not, however, going to follow those limitations as much as I did in earlier stages because I believe that as the United States are now manufacturing munitions on a large scale and have been quite free in publishing their statements of production, secrecy about our own production is not as necessary now as it was in the earlier stages. There is, of course, certain information about our production which is confidential and which I must keep confidential, but I am going to give hon. members a fairly comprehensive view of the state of our production at this time.

It is always interesting to see ourselves as others see us. Recently a British management and labour delegation made a tour of the United States and Canada, at the request of the United States government, to survey the current position of war production. Four of the members were industrial executives and four were representatives of British trade unions. Last week the delegation issued its parting message as an official press release. I quote from this release:

While on the North American continent, we have been privileged to inspect over 80 different plants. During our stay in Canada, we have been able to see the production of naval and mercantile ships, aircraft, guns, machine guns, shells, machine tools and other war-time equipment of vital importance, being produced on a scale that not only surprised and heartened us, but which, we believe, will similarly surprise and hearten the people of the dominion itself.

I was interested in the fact that this delegation believed it to be their duty to tell the people of Canada how well we are getting on. Evidently they had heard disparaging remarks from our own people. I am certain that no one in a position to know the volume of our current munitions exports has any desire to disparage our efforts. In saying this, I wish to say also that our effort is no better to-day than it was six months or a year ago. The only difference is that we are witnessing a later stage of our production programme. At the next session of parliament our output records will enable me to give a still more impressive record of Canadian achievement, but that again will be merely a later stage of the same programme.

At present practically every plant in Canada capable of war work is engaged in war work, either wholly or in part. To September 30th the estimated dollar value of contracts awarded by the Department of Munitions and Supply amounted to approximately $2,600,000000. Of this amount, Canadian orders totalled $1,506,000,000, which had been filled by Canadian production to the extent of

$1,325,000,000, from the United Kingdom $40,000,000, from the United States $140,000,000, and from other countries about $1,000,000.

Capital assistance to industry for the extension of existing plants and for the construction of new plants, instalment of equipment, et cetera, aggregated a total of $550,000,000, partly for Canada, partly for the United Kingdom and partly for joint account.

Our shipbuilding programme has been expanded to a point where total orders for ships now exceed $500,000,000. To date Canada has launched seventy-seven corvettes and delivered more than fifty of these for active service; has launched fifty-nine mine-sweepers, of which about forty have been completed; and has also delivered eleven patrol boats, nineteen motor torpedo and crash boats, and some 700 smaller boats, some with power and some without power.

Our cargo vessel programme is well under way, and two 10,000-ton cargo ships have already been launched and will be delivered this autumn. Before the end of 1942, we expect to deliver into service about 100 cargo ships, of which ninety will be of 10,000-ton capacity and ten of 5,000-ton capacity. Some 500 industries located across Canada from coast to coast are engaged in manufacturing components for these cargo vessels.

In addition to our cargo vessel programme, we are laying down keels for larger and faster corvettes and for a large number of corvettes and mine-sweepers similar to those already built. All our seventeen major shipyards are working to capacity, and are being expanded to the fullest possible extent. There are fifty-eight smaller yards working on our small-boat programme.

Our aircraft industry has manufactured in Canada and placed in service since the outbreak of war, or has assembled in Canada, 3,749 aircraft. In addition, we have received from the United States in the same period 1,268 aircraft. The present average rate of production is approximately forty per week for all types, and in this regard it should be pointed out that the present production includes a heavier proportion of advanced trainers and service aircraft than in the earlier *months of production. Link trainers are also being produced in Canada, with deliveries now well past the 100 mark.

We are now in position to manufacture aircraft to meet all the requirements of the air training plan, as well as the aircraft requirements of the British training schools that have been located in Canada. We are in very substantial production of Hurricane fighters and Bolingbroke bombers for operational work, we are well advanced toward

The War-Munitions and Supply-Mr. Howe

production of the Consolidated P.B.Y. boat, and we have recently undertaken production of the newest type of British 4-engine bomber, as well as a new type of British fighter plane.

The repair and overhaul of aircraft and engines, which is a rapidly growing responsibility as the number of planes in Canada increases, is being carried out by the department in twenty-nine plants strategically located across Canada. It is estimated that the number of aircraft requiring overhaul at the present time is 5,000 a year, and that a year from now the number of overhauls will reach 10,000 a year. This overhaul work represents a very substantial aircraft industry in itself.

The Canadian automobile industry has played a tremendous part in equipping the forces of the empire. Already over 150,000 vehicles of all types, army trucks, personnel carriers, et cetera, have been delivered, and deliveries are continuing at the rate of thousands each month. In addition, bicycles, motorcycles, buses, tires, spare parts, et cetera, have been delivered in large quantities.

In the field of armoured fighting vehicles, we are now delivering infantry tanks, cruiser tanks, universal carriers and armoured scout and reconnaissance cars at a rapidly expanding rate of production. Production of tanks began in June, and the rate of production has increased steadily since that date. Early in 1942 we are scheduled to achieve a production rate of 200 medium tanks each month.

I may say that a tank represents a tremendous amount of work and the cost is in the vicinity of $90,000. I mention that only as an indication of the amount of material and workmanship which goes into a tank's construction.

Universal carriers came into production in the middle of the year, and already over 1,500 have been delivered. These very useful vehicles are now being produced at a rate of over 400 each month, and this rate will be substantially increased early in 1942.

Armoured scout and reconnaissance cars of Canadian design will be produced in quantity before the end of the year, and the production rate of hundreds per month will be reached early in 1942.

Guns and equipments, after long months of planning, building and tooling, are now in very substantial production. This is a wholly new Canadian industry, and has required heavy capital expenditure for plant and for training of skilled personnel. The early period of low production is now moving into the crescendo of mass production. We have already delivered thousands of gun barrels of the anti-aircraft types, and are now delivering

complete gun mechanisms. We have delivered tank guns and field guns, and the first of our naval guns will be ready this month. Altogether we are producing more than ten types of complete heavy guns, including anti-aircraft field, tank and anti-tank and naval type guns, together with all mountings and parts to make the complete fighting units. The 1942 rates of production will be:

Anti-aircraft-over 400 per month.

Field-over 500 per month.

Naval-over 150 per month.

Extra barrels-over 1,000 per month.

The production of these intricate mechanisms is high testimony to the skill and determination of Canadian industry.

My hon. friend the leader of the opposition spoke of the delivery of four guns overseas.

I presume these would be field guns, 25-pounders. All I can say is that many of us in this house attended the opening of the plant on July 1 last when six complete guns were on exhibition and were tested before the assembled gathering. Of course, we only make the guns; where they go after they leave the factory is something with which I have no concern. I should think, howrever, that probably the guns were more urgently needed elsewhere either in Canada or in other areas of service, which may account for the fact that only four reached our own forces.

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NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

These were British guns, 5-5.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

That is something else.

In the field of machine guns and small arms, Canada is making a worth-while contribution to the equipment of empire forces with rapid fire infantry weapons. We have created rifle and machine gun plants that compare in size with any similar units in the world. We have already produced over 12,000 Bren guns and over 14,000 additional extra barrels. Hon. members will note that, whereas the first Bren gun contract called for this number of guns to be produced over a period of two and a half years, all deliveries called for under that contract have now been made. Production of this gun now runs at the rate of more than 2,000 a month and is still increasing.

In addition to the Bren gun, we are now producing Browning aircraft machine guns, with a production rate rising to thousands a month early in 1942. In addition, we are bringing into production the Vickers machine gun and Boys anti-tank rifle and Sten sub machine gun. Early in 1942 we will be producing naval machine guns and mountings in hundreds, and anti-tank rifles and sub machine guns at rates of thousands a month. We have already delivered substantial quantities of Lee-Enfield

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[DOT]303 rifles, and production rates, now in thousands a month, will increase to over 200,000 a year.

Trench mortar deliveries, already in hundreds, will increase to a rate of over 400 a month. In addition to trench mortars, we plan 1942 production of bomb throwers and smoke projectors.

In heavy ammunition, we are producing twenty sizes of shell, and have already delivered over 9,000,000 units. Our capacity is in excess of 1,200,000 shells a month. We are producing ten sizes of cartridge cases, and have already delivered over 10,000,000 cases. Our capacity is about 2,000,000 cases a month. We have produced in excess of 7,000,000 fuses of all types, and have capacity for over 1,000,000 a month. We have produced in excess of 8,000,000 primers, with a continuing capacity of 1,300,000 a month. We have produced many millions of gaines, tubes and miscellaneous shell parts, as required for complete ammunition, and have a capacity of about 1,000,000 a month. All these empty components, together with other minor component parts, are required for the complete rounds of filled ammunition. Their production is coordinated with the capacity and requirements of our filling plants, with some surplus shipped empty as required abroad.

Vast new plants have been created and personnel trained for the exact operations of filling ammunition with high explosive and propellant charges. We are now shipping filled complete rounds, and production of these will expand rapidly as our filling plants swing into full production. Capacities for 1942 production are at present arranged as follows:

Complete rounds-over 1,000,000 per month. Cartridges-over 700,000 per month. Projectiles-over 700,000 per month.

In addition to complete rounds, cartridges and projectiles, we have provided capacity for filling bombs, depth charges, mines and fuses.

In the field of small arms ammunition, Canada holds an enviable position in the matter of quality and quantity of production. We have already delivered hundreds of millions of rounds of small arms ammunition of various types. Our capacities include ball, tracer, incendiary and armour piercing types of -303, -30/06, -22 long and -38. New capacity is being created for the production of -SO, [DOT]55, '45, 9 MM and 20 MM. Current capacities are about 50,000,000 rounds a month, and will be trebled in 1942.

Our bomb programme includes types from 500 pounds down to practice bombs. Deliveries have already been made in excess of 500,000

units. Mortar bombs, grenades and anti-tank mines are in production, with monthly capacity in the tens of thousands.

Our chemicals and explosives programme is a major part of our munitions production. Explosives are produced for our own filling plants and for shipment overseas. The range of production extends from high explosives, rifle and cannon propellants, and TNT, down through the intermediary chemicals and raw materials. The standard of our product enjoys a very high rating, and we have already delivered over 150,000,000 pounds of finished products. Capacity in 1942 will reach 70,000,000 pounds a month of chemicals and explosives, with complementary production of subsidiary materials.

In the field of pyrotechnics, we are producing signal cartridges, flame floats, flares, smoke generators, sea markers, signal rockets, lights, igniters, et cetera, by the tens of thousands each month. Already hundreds of thousands of these special stores have been delivered to our forces and allied governments.

Production of instruments includes technical apparatus and gear, ranging from fire control gear, range finders, telescopes, et cetera, through to clinometers, gauges, et cetera. We are already in production on many of these precision instruments, and production is scheduled to match ordnance requirements from now on. Thousands of gauges and standard instrument types have already been delivered.

Our general purchasing department has procured the vast quantities of personal equipment and barrack stores required for our services, including thousands of tons of food, fresh and canned. Clothing, boots and shoes, caps, mitts, gloves, greatcoats, et cetera, have been turned out at the rate of many thousands a month. Other stores procured include office furniture, office equipment, electrical supplies, fuels and paints, lubricants, medical supplies, tools and hardware.

The construction branch of the Department of Munitions and Supply has awarded construction contracts aggregating 1,558 in number for a total of $146,000,000. These include work for the army, navy and air force and the air training plan, as well as harbour works, and extensions or additions to aircraft manufacturing plants. This does not include civilian housing, which is handled by Wartime Housing Limited.

The air services branch of the Department of Transport, which now operates under the direction of the Minister of Munitions and Supply had, up to the end of September, completed 108 new airports for the use of the

The War-Munitions and Supply-Mr. Howe

Royal Canadian Air Force and air training plan, and had thirty-one additional airports under development. Included in the above are eighteen airports now occupied by the Royal Air Force in connection with its training project in Canada. As at 31st August, 1941, the sum of $64,000,000 had been allocated for airport construction, exclusive of buildings. In addition, the cost of airport hangars, workshops, barracks and associated works and buildings for the Department of National Defence for Air has involved an expenditure of $117,000,000. Over 100 airports have been equipped for night flying; and power, telephone and lighting facilities have been installed by the air services branch at a cost of $5,200,000. Operational airports are now under way in Newfoundland and Labrador, between Edmonton and the Alaska boundary, and along the northern coast of British Columbia, in areas far from human habitation, involving unusual engineering problems. In my opinion, this work of airport construction calls for all credit to Canada's construction industry and to the staff of the air services branch of the Department of Transport, who have planned and supervised the work.

Hon. members may be interested in a brief mention of the work of the wholly government-owned companies operating under the direction of the Department of Munitions and Supply.

Allied War Supplies Corporation administers the chemical, explosives, and1 ammunition filling programme, including twenty-three separate projects. Construction work is now largely completed. Twenty projects are in production, and the remainder will be in operation before the end of this year. Approximately 15,000 employees are engaged in operations, and it is estimated that twice that number will be required as the plants are brought into full production. One new chemical plant has recently been authorized for the manufacture of aniline, and additions have been authorized for four chemical and explosives plants. Capital commitments now total about $112,000,000.

Citadel Merchandising Companj' Limited supervises the purchase and distribution of machine tools. During the quarter ended September 30 last, this company purchased machinery and machine tools to the value of $23,400,000. Since it commenced operation, this company has purchased and distributed machine tools to a total value of about $60,000,000.

Fairmont Company Limited is responsible for maintaining in Canada adequate supplies of rubber. This company is the sole buyer of rubber for Canada, and its product is sold to

war and domestic industries as required. In addition, the company buys and distributes hides for our leather industry.

Melbourne Merchandising Limited was established in September, 1940, to purchase in bulk the wool required for military contracts, and also to act as handling agents for the British wool control. This company is charged with the responsibility for having adequate supplies of wool available for war industrial requirements.

National Railways Munitions Limited was incorporated to produce munitions at various shops and car plants of Canadian National Railways. The company is engaged in the production of naval guns and gun carriages, and will shortly be in production.

The Plateau Company Limited was formed to purchase, store and distribute to war industries adequate supplies of silk, required for parachutes and other purposes. Since the issue of an order in council on August 9, 1941, "freezing" all silk in Canada, Plateau company has been taking delivery of all "frozen" silk for government account.

Research Enterprises Limited was organized in August, 1940, to provide facilities for manufacturing war material of a secret nature developed by the national research council, and for the production of optical glass, fire control instruments, both optical and electrical, and devices of a secret nature required by the army, navy and air force. This operation has developed in a most spectacular way, and has been found to meet a major war requirement. The main plant has been in operation for some months and now employs more than 1,500 men and women. The first optical glass produced in Canada was made by Research Enterprises in June. The company now has orders totalling over $55,000,000 for optical equipment, instruments and secret radio devices.

Small Arms Limited. This company was formed in August, 1940, to build and operate a plant at Long Branch, Ontario, for the production of Lee-Enfield rifles, bayonets and scabbards. The present programme provides for six times the capacity of the original plant. The company has recently undertaken the production of Sten machine carbines. About 1,250 men and women are now employed at the plant. A substantial quantity of rifles has already been delivered, and the output is increasing rapidly each week.

War-time Housing Limited. This company was incorporated in February, 1941, to provide housing accommodation for munitions workers in communities where serious congestion has developed on account of war projects.

4086 COMMONS

The War

Munitions and Supply-Mr. Howe

The present programme embraces the construction of 4,427 cottages, thirty-five staff houses, four commissaries and two special buildings, in twenty-seven cities and towns across Canada. The expenditure for the entire programme now under way or projected is estimated at $15,750,000. The programme is constantly being expanded to meet urgent requirements for housing for munitions workers.

War-time Merchant Shipping Limited. This company was incorporated in April, 1941, to administer the programme of cargo ship construction in Canada. This programme calls for 143 vessels of 9,300 tons and ten vessels of 4,700 tons. Two of the larger type ships have already been launched, and a third will be sent down the ways on November 6. Keels have been laid for twenty more of the larger class Ships. Twelve shipyards are engaged in carrying out this merchant ship programme.

War Supplies Limited. This company was formed in April, 1941, as a means of implementing the declaration of Hyde Park. Its function is to negotiate and to receive orders from departments of the United States government for war supplies to be manufactured in Canada. I should perhaps mention that the declaration of Hyde Park has worked out as was contemplated, with the result that Canada's problem of dollar exchange is in process of being solved.

Federal Aircraft Limited. This company was established in June, 1940, to administer a large programme for the production of Anson aircraft required for the air training plan. Ansons have now been built and flown at all five of the company's assembly plants, and a considerable number have now been test-flown and delivered to the Royal Canadian Air Force. The aircraft being produced1 by this company is a material improvement on the British type Anson, and production is stepping up rapidly.

An interesting development of our munitions programme, brought into being to mobilize the last ounce of Canada's war productive capacity, is known as our "bits and pieces" programme. Munitions contracts call for a tremendous volume of production, and it was inevitable that the large contracts were placed in large factories. It is now our purpose to have the large plants break down their large contracts into small contracts and to sub-contract these as widely as possible, in order that Canada's peace-time machine tool capacity may be fully utilized for war work.

There are many advantages in expanding our production by a "bits and pieces" programme, rather than by building more large plants. I may mention a few:

First. There is a limit to the amount of work that can be handled by our larger manufacturing organizations, as they represent only a portion of the country's productive capacity which, from a mechanical standpoint, can be adapted for war use.

Second. The machine tool market has now reached a point where it is difficult, and in some cases impossible, to secure machine tools as rapidly as required.

Third. By taking work to the men rather than the men to the work, we can avoid disruption of community life in some areas and congestion in others, save in housing costs and community facilities, and obtain a more suitable type of labour. Readjustment problems will be lighter after the end of hostilities, and the load on the taxpayer less.

Fourth. By spreading the vrork to hundreds of small shops, use can be made of thousands of skilled workmen, who, through their age, position, or other reasons, do not desire to change their homes and source of livelihood.

To facilitate carrying out this programme of sub-contracting, a new branch has been formed known as the industry and subcontract coordination branch, with headquarters at Ottawa and regional offices across the country. The branch and district offices are designed to help small manufacturers, and those threatened with curtailment of peacetime operations, to obtain contracts or subcontracts of a type that they are equipped to handle. The purpose is also to encourage subcontracting and to assist the prime contractors in setting up and operating efficient subcontracting departments.

A great deal has already been accomplished in the field of sub-contracting. Millions of dollars worth of bits and pieces are already in process of being manufactured. Several large industries such as the pulp and paper, oil, utility, and mining have set up organizations to coordinate the use of the available hours of their maintenance shops. A great many of our so-called luxury manufacturers are changing over to the production of war materials.

As an outstanding example of what has already been accomplished in this direction, I may mention the 25-pounder gun programme being carried out by Sorel Industries. This plant w'as built to manufacture 25-pounder equipments at the rate of eight a month. It is now' building about forty complete equipments a month, and by the end of the year will be building fifty complete equipments a month. The increase in production has been brought about partly by an extensive system of sub-contracting.

The War-Munitions and Supply-Mr. Howe

The 25-pounder gun is made up of approximately 1,286 parts, and of these 529 parts, or about 41 per cent, are being sub-contracted. These parts are divided among sixty-three small plants in the provinces of Quebec and Ontario. The parts that are being made at Sorel are some of the most difficult, and also those requiring special single purpose machines. The parts that have been sub-contracted are being handled by shops, the smallest of which is a two-car garage behind a house, operated by the owner and two helpers, and having about $4,000 worth of machinery; and the largest a modern shop having $300,000 worth of machinery and 600 employees. The small garage is providing two precision parts-a pin and a bracket. The large shop is manufacturing a highly complicated dial sight having 122 precision parts, many of which have to be made with the same accuracy as required in an expensive watch.

In the last two months over 82,000 finished parts have been supplied by these sixty-three sub-contractors to the main factory at Sorel. Production of these parts does not come about by merely handing blueprints to manufacturers and asking them to supply the parts. It has been found that in a great many cases, manufacturers, in their desire to assist in the war effort, and because of overoptimism, have accepted work from prime contractors and failed to produce.

The excellent work that is being done in sub-contracting by the Sorel plant is due to the use of engineers on loan from the Chrysler corporation, who have put into effect methods arrived at by years of experience in subcontracting in the automotive industry. Under the direction of those men, remarkable results have been obtained in cutting down man-hours and costs of production.

What Sorel Industries have done, other manufacturers can do. My remarks on this subject have been extensive, for the reason that I am asking the cooperation of all manufacturers in the further development of subcontracting and cooperation in our bits and pieces programme. The department is ready and willing to assist in every way, but the manufacturers, both large and small, must do their part. The small shops and displaced industries must be prepared to help themselves if the department is to be placed in a position to help them.

To assist in furthering this bits and pieces programme, I have issued instructions that before additional capital assistance will be approved, a full investigation must be made of the possibility of sub-contracting. Those responsible for purchasing have been asked

to break down orders to a size that can be handled by as many small manufacturers and displaced industries as possible.

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CON

Joseph Henry Harris

Conservative (1867-1942)

Mr. HARRIS (Danforth):

The minister mentioned capital assistance. Would he say if there is any liquid capital assistance, or working capital assistance, being given these concerns?

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LIB
CON

Joseph Henry Harris

Conservative (1867-1942)

Mr. HARRIS (Danforth):

Small concerns. Would the minister say whether any working capital assistance is being given these small concerns?

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

It depends entirely upon the individual case; ordinarily not. What we are endeavouring to do in the bits and pieces programme is to utilize existing capacity. Capital assistance would imply that we were building up small concerns for the purpose of participating in the programme. That is not the purpose of the programme. Of course we have offered capital assistance for specialized work which we could not get done in the routine, but that is separate and apart from the bits and pieces programme.

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CON

Joseph Henry Harris

Conservative (1867-1942)

Mr. HARRIS (Danforth):

I quite understand about the capital assistance, but I am asking if any working capital assistance is given.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

There again it depends upon the circumstances. I do not like to make general statements about a very large programme.

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CON
LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

I would not say it has not been done, but it is not usual to do it.

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CON
LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

I think hon. members will agree that the production programme as it is to-day is tremendous in scope. It will be readily appreciated that a programme of this magnitude makes tremendous demands on our sources of raw materials. To supply our war industries it has been necessary rigidly to control distribution of war materials and to assure a priority of use to war industry, as against peace-time industry.

The control over essential war materials has been obtained by the appointment of twelve controllers of materials and services. These twelve controllers are members of the war-time industries control board, under the chairmanship of the director general of the priorities branch. The purpose of the controllers is principally to ensure adequate sup-

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The War-Munitions and Supply-Mr. Howe

plies to war industries, but the work of the board is closely associated with that of the war-time prices and trade board, the latter board having complete control of prices. Each controller administers the policy of the wartime prices and trade board as applied to the industry over which he exercises control. The following is a brief outline of action taken by the controllers to date:

Machine Tools. Machine tools are basic in war production, and every effort is being made to increase their supply and to restrict their non-essential use. In 1940, designs were frozen on a broad list of consumers' durable goods, including automobiles, in which a change of model would otherwise require new tooling. Every effort has been made to distribute machine tools to war industries in need of such equipment. No exports of machine tools may be made without licence. A government-owned company, Citadel Merchandising Company Limited, assists in the financing of the greatly extended production and purchase of machine tools.

Metals. The metals controller has supervision over the supply, distribution and use of all non-ferrous metals, minerals, and alloys. Substantial restrictions have been imposed on the civilian use of essential metals. In the case of copper, lead and zinc, all tonnage in excess of that required for the Canadian war programme and for greatly restricted domestic requirements is sold under contract to the United Kingdom. The production of metals in Canada has been greatly extended, and this country, which produces the principal base metals such as aluminum, nickel, copper, lead and zinc far in excess of domestic requirements, is supplying these metals in very large quantities to Great Britain and/or the United States of America. In addition, progress has been made in developing sources of strategic metals which were not produced in Canada in any quantity before the war.

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November 4, 1941