November 6, 1941

NAT

Karl Kenneth Homuth

National Government

Mr. HOMUTH:

Would the minister

elaborate a little on the rent situation with regard to the setting of the ceiling?

Topic:   THE WAR
Permalink
LIB
NAT
LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

The suggestion has been made that we were bad psychologists or bad politicians, or something of that kind. I think from two or three sources it was said that the psychology of the thing was bad, that we should have gone further than we did, and from the psychological point of view, if for no other reason, it should also have applied to salaried people and executives. I did not intend to make this announcement at this time, but I should like the committee to know that for the last two or three weeks we have been working at an order to place a ceiling over all managerial and executive salaries, directors' fees, et cetera, and that ceiling, I may say, will not provide for any cost of living bonus. It will be readily apparent that there are difficulties in working out the details of such an order, but I hope to have these resolved and to be able to announce the programme in a very few days.

There are a great many people in Canada who would like to know what they can do to help make this a success. I think that should be the attitude of every member of this committee and of everyone in the country; it is the attitude of thousands and thousands of people. I cannot put my suggestions in any more concise form than I did in a speech which I made some time ago when I was asking business men for their assistance in making government control measures operative and effective. Therefore, while I dislike to quote what I said before, as I cannot put it any better, I am going to do so. I said:

First of all, I would ask you to shun a defeatist attitude towards rising prices. Inflation is not inevitable. It can and will be prevented. It will be prevented much more easily if we all join in the effort and reject the view that resistance is useless.

Secondly, we need your active support in our savings campaigns. A rising volume of savings will not only provide the government with the funds needed for war purposes but it will relieve the persistent upward pressure of expenditure on prices. This is its important economic purpose.

In normal times-in peace-time-we do not try to discourage expenditure. We encourage it, to obtain employment and, if possible, prosperity. But these are anything but normal times. Now we must limit expenditure. The

The War-Finance-Mr. Ilsley

more we can limit it by encouraging voluntary saving, the better it will be for all concerned, including business. For example, if *a business finds itself with its prices fixed and its costs being forced up by excessive expenditures in other fields, it will be vitally interested in reduction of these expenditures. You need have no fear now that under present conditions there will be too little spending. What we need to do is to reduce the pressure of excessive spending. Therefore we are asking the public to spend less and save more. We need your support. We want your support in facilitating the organization and extension of savings plans in your own businesses.

Do not be misled by the spurious argument that more expenditure is needed to swell government revenues. The harm done by the extra expenditure is far greater than the good done by the extra taxes. We need the whole dollar diverted to us, not the fraction of it which would eventually come into our hands as taxes, if it is spent. The diversion of the dollar to us is needed to make available for the war the labour and materials which the expenditure of the dollar otherwise would merely use up in civilian satisfaction.

Thirdly, we shall need your cooperation, your active cooperation, in keeping your costs of production down. Price stability can only be achieved if costs can be held in check. In the last analysis they must be held in check by those who are running the businesses concerned. Waste of labour or materials must be eliminated-the nation cannot afford it in war-time. Luxury, extravagance or just plain carelessness in business expenditures cannot be tolerated. The government and the price controlling authorities cannot permit business to enjoy at this time the luxury of a situation in which increases in costs may be automatically passed on to the consumer.

If some costs increase I hope business will find others that can be reduced-perhaps overhead, when output is large, perhaps selling costs, now that there is an almost universal sellers' market, perhaps most of all the unnecessary costs due to an excessive number of patterns, types and varieties of products.

And, fourthly, we need your help in carrying out all our direct controls not only of prices but of production, and the use of materials as well. It is the managers of business who know how materials can be saved by substitutes, by standardization and by repairs. Your assistance is necessary in working out controls in such a way that they will do the most good, and the least harm. Your cooperation is needed in putting them into effect, with a minimum of dislocation. These controls are not going to be easy or pleasant for any of us. But they are necessary, if we are going to exert the greatest effort of which we are capable in the war, and therefore I am confident that you will all support them.

I was talking to 'business men on that occasion, but I should like to address the same appeal to farmers, to wage-earners and [DOT] consumers-indeed, to all the people. This situation is too serious to have a nation resisting or divided, or taking any steps which will render ineffective any important, carefully considered, well-reasoned government

fMr, Hsley.l

policies. I make the appeal to the people of this country to help us make our priceceiling policy a success.

Topic:   THE WAR
Permalink
NAT

Thomas Langton Church

National Government

Mr. CHURCH:

Price fixing is going to land business in an awful mess in this country, before you get thro.ugh with it.

Topic:   THE WAR
Permalink
LIB

Norman Alexander McLarty (Minister of Labour)

Liberal

Hon. N. A. McLARTY (Minister of Labour):

Mr. Chairman, before I begin my formal statement, a statement which I am afraid the committee will find much too formal, may I extend to my colleague who has just taken his seat (Mr. Ilsley) congratulations upon the magnificent address he has given. Perhaps I am somewhat selfish in offering my congratulations, because his remarks have made my task much easier, and will enable me considerably to shorten my remarks.

He has dealt with the question of the inflationary spiral and the question of managerial and executive salaries. He has dealt with many questions with which I now find it unnecessary to deal.

I should, however, like to make one further preliminary observation. A few minutes before entering the chamber to-night I had an opportunity of listening to a re-broadcast of the address by the President of the United States before the International Labour Organization. During the last week, while it met in New York, I had the privilege of attending the meetings. Incidentally may I state that in my opinion it is a matter of gratification to the committee that we have afforded a haven of refuge for that office, when it decided to move from Geneva.

There were represented at the meeting thirty-three different nations. The remarkable fact was that some of those nations had been overrun ; some of them had felt the force of Hitler's heel. The impression I got, sir, was that labour is doing a great deal to keep the lamp of liberty burning in this world.

Certain questions have been asked and references made respecting individual problems with which, as Minister of Labour, I have had to deal. The leader of the opposition (Mr. Hanson) referred to one, the hon. member for Waterloo South (Mr. Homuth) to another, and the hon. member for Vancouver East (Mr. Maclnnis) to another. I thought perhaps in view of the understanding that there will be opportunity to consider individual questions later on, I would reserve my explanations on those points until that time.

With these preliminary remarks I crave the liberty to make copious references-I believe that is the phrase-to my notes. Might I at the outset of my remarks state that I welcome the opportunity of placing before this com-

The War-Labour-Mr. McLarty

mittee a statement of the activities and policies of the Department of Labour. I was invited to do so the day before yesterday by the leader of the opposition, and the remarks of the hon. member for Vancouver East would, of course, make it imperative that I do so.

The difference in the viewpoints of the leader of the opposition and the hon. member for Vancouver East are rather marked. Those differences are shared by many in Canada. For example, if I was correct in my inference from the remarks of the leader of the opposition, as a result of his recent visit to England he suggested that in labour disputes we should adopt a policy of compulsory arbitration. On the other hand, the hon. member for Vancouver East suggested, and suggested vigorously, a policy of compulsory recognition.

Both are agreed on one point, namely, that relations between employers and employees should be regulated in a compulsory manner. While it may be true that compulsion may be the most expeditious method of settling a labour dispute, it is not, I suggest, the true corrective method or the one that in the final analysis will prove effective in producing stability in the relationship between labour and industry.

The hon. member for Vancouver East suggested that labour should be a partner with industry. With that proposition I entirely agree. If fulfilment of that idea of partnership should come-and it will-it would render very much easier the task of any minister of labour.

But a partnership is a matter of mutual agreement. To be successful it must be the result of a desire of both parties each to cooperate with the other. Coercion is not the appropriate method of establishing it.

I mention this because recently I have been criticized for not stopping some strikes in industry by what are termed drastic measures. For example, in the slow-down strike in Cape Breton there were requests made that we "throw in the troops" and that we "intern the men". On the other hand there were demands that we take over the mines. We did neither.

I am convinced to-day that to have taken either course would have been unfortunate. I say that with somewhat more confidence by reason of the fact that the coal mines in Nova Scotia are to-day producing more coal than ever before in the history of that province.

That the policy of this government has been to some extent vindicated is evidenced by the fact that there is not a single strike

in any war industry in Canada to-day. But I should like to give credit where credit is due, and I should like to-day to pay a tribute to those labour leaders in Canada who by their sincere efforts to promote industrial peace at this time have made that result possible.

An impression has been created in the public mind that in this country strikes have been rampant and that labour has not been doing its very utmost to assist in the war. This is possibly due to the fact that when

3,100,000 men and women go to work each day it is not news, but if thirty do not go to work, it is news. A great deal has been said, and properly said, about the loyal devotion to duty of workers in other lands. But what about the workers in Canada? I do not in any way wish to belittle the efforts of the workers in other countries, but in fairness to the workers of Canada I feel it is only just that I present certain figures to this committee which will, I believe, indicate that they have not been weakening or slackening in their work.

For the first six months of the present year the man-days lost due to strikes or lockouts for each 1,000 wage-earners were as follows:

In Gireat Britain 41

In Canada 54

In the United States 381

I have not the figures for Australia for the six months' period, but have for the first three months' period, and in that period their time loss due to strikes or lockouts was ten times greater than in Canada.

Before I proceed to a consideration of the various orders in council pased on the recommendation of the Minister of Labour, may I deal with one other matter. The suggestion was made by- the member for Vancouver East that this government is opposed to the aims and aspirations of organized labour. I cannot state too emphatically that this is not correct. It would be difficult for me to imagine and, what is more important, it would be difficult for organized labour to imagine that any government headed by the present Prime Minister of Canada would desire to subtract from those rights which labour has gained over the last century.

We have asked labour to surrender some of its rights, but the Prime Minister has given an assurance that those rights will, after this war is won, be reestablished and reestablished in a generous manner. If any more effective assurance is required or desired I am prepared to recommend to my colleagues in the government that such further assurance should be given, and I know that favourable action would be taken on that recommendation.

The War-Labour-Mr. McLarty

With this point in view, while it is one thing to declare a policy and another to translate it into action, in June of last year, with the full approval of representative organizations of labour and industry, the government issued an order in council, P.C. 2685, which does express the fundamental principles of our wartime labour policy. It declared that good industrial relations are especially important in war time; that no element in the community can be permitted to benefit from war-time necessities; that the needs of the community at large must be regarded as paramount; and that the aspirations of workers to the right of association and to enter into collective agreements will, under wise direction, make for the removal of prejudice and for fuller cooperation between employers and employed.

The principles set forth in the body of this order in council are, in summary form, as follows:

(1) Every effort should be made to speed production by war industries; (2) Fair and reasonable standards of wages and working conditions should be recognized and any temporary adjustments in remuneration due to rvar conditions might well be in the form of bonus payments; (3) Hours of work should not be unduly extended but rather increased output should be secured by the adoption of additional shifts; (4) The established safeguards for the protection of the health and safety of the workers should not be relaxed; (5) There should be no interruption of work on account of strikes or lockouts. Differences not otherwise disposed of should be settled under the procedure of the Industrial Disputes Investigation Act; (6) Employees should be free to organize in trade unions free from any control by employers or their agents. The existing provisions against illegal refusal to employ or to dismiss from employment because of trade union membership and against intimidation to prevent a workman from belonging to a union were reaffirmed; (7) Employees should be free to negotiate with employers through representatives of their own choosing with a view to the conclusion of a collective agreement; (8) Every such agreement should provide machinery for the settlement of disputes and should be scrupulously observed; (9) Workers should neither coerce nor intimidate any person to join their organization; (10) Any necessary suspension of established labour conditions in order to speed up war production should be effected by mutual agreement and should apply onily during the emergency.

I have taken the time to read these because the order is an appeal, not a command, and it is still necessary to publicize these principles and to work for their more general and willing acceptance. Specifically, there are still many employers who are not yet genuinely willing to negotiate and sign collective agreements with trade unions.

Might I suggest that we can defeat totalitarianism at home and abroad only if we really put our trust in the democratic process,

'Mr. McLarty.]

not only in our political life but in our industrial life. I believe that trade unionism is the essence of industrial democracy and that it must be woven ever more firmly into the fabric of industrial relations. On the other hand it is necessary to warn some unions that the fact that the government has declared the principle of freedom to organize does not mean that the government will conduct organizing campaigns for them, or approves any inclination to exploit the necessities of the war situation to high-pressure workers into unions which without such high pressure methods they would not be willing to join.

I have already made it clear that order in council, P.C. 2685, of June 19, 1940, setting out these principles, the general acceptance of whicli by industry and by labour would contribute to the success of the war effort, was not made compulsorily binding on either employers or workers. In some quarters the government has been subjected to criticism that this order was not made compulsory; in other words, the employers are not forced to enter into union agreements. The government, however, has been and still is reluctant, for reasons I have already mentioned, to introduce compulsory features into the field of industrial relations, and I am quite sure that any criticism of governmental policy in this respect is not receiving support from the more thoughtful elements in the labour movement. None of us can see very far ahead these days and it is impossible to determine at this stage what compulsions may yet have to be resorted to, but certainly in respect of industrial relations the public policy set out in P.C. 2685 has been fully justified in the very general avoidance of industrial disputes at the present time.

Another order in council affects more particularly those who, after enlisting, are discharged or demobilized. This order provides that the fullest measure of protection will be given to those who left their employment or service to enlist in the armed forces. It is known as the civil employment reinstatement order.

This order makes it mandatory for any employer, by whom a person accepted for service in his majesty's forces was employed when accepted, to reinstate him in employment at the termination of that service in such occupation or position as the order provides. It is the expressed intention of this order to ensure that this will be done under conditions no less favourable to the enlisted employee than those which would, have been available to him had he not so enlisted. In the last war there were a great number of complaints from men discharged from his majesty's forces serving in Canada or overseas who were refused the

The War-Labour-Mr. McLarty

positions they formerly held. In as far as the government can properly prevent such complaints, they will not ensue either during or following the present war.

The splendid men who enlist in the armed forces will, subject to what I have just said, have no justification for saying that while they were in uniforms or fighting abroad, others who might have been fighting there have taken their positions.

This order is one that will require legislation to make it effective after the war, and it is the intention of the government to introduce as soon as possible in the ensuing session of parliament the necessary legislation for enactment by parliament.

This order and the legislation which will ensue contain a penal clause and make any employer who fails to comply with the provisions of the order or the regulations made thereunder guilty of an offence and liable on summary conviction to substantial penalties.

May I here state that it has been suggested that the government has passed orders which require penalties from employees but that orders enjoining employers have been exempted from any penalties. I will be glad to give illustrations that will prove the inaccuracy of this suggestion.

The government has also taken steps to assure employees of firms engaged in war work minimum compensation for their labour. As members are aware, the fair wages act was passed in 1935 setting forth what wages should be paid and the hours of labour which should be worked. It was felt that the minimum compensation paid employees in war establishments should be increased and on the 4th of October last a new order was adopted making it part of the law of Canada for a contractor or a sub-contractor to pay male employees not less than thirty-five cents an hour.

. By another order the Minister of Labour is empowered when he finds that a contractor or subcontractor is employing any person at less than the fixed minimum rate prescribed, to withhold payment of any amount due to such contractor. A cheque for the amount of the underpayment must be delivered to the deputy minister of labour to be held as trustee for the settlement of such a claim.

This order further provides that such contractor or subcontractor must likewise keep a true and correct record of the wages paid and the hours worked by each of his employees.

In this order provision has also been made that any contractor or subcontractor who fails to comply with the regulations contained is guilty of an offence and liable on summary conviction for penalties ranging from $200 to $1,000. It will thus be seen that precautions have been taken to give to workers employed 14873-263 revised

in establishments engaged in war work that protection to which they are entitled.

Another order that has been passed provides for the course to be followed before any strike may be declared legally, following procedure under the Industrial Disputes Investigation Act. Under the provisions of this statute it was required that authority to declare a strike must be obtained before any board could be applied for. When, however, the government set up the inquiry commission, to which I will refer, the requirement as to a strike vote was not insisted upon in all cases in so far as reference was provided to the inquiry commission.

But I believe that no member of this house would suggest that it is not fair and not democratic that before any man goes on strike he has the right of self-determination and the right to say whether such a strike shall take place or not. It is because of that belief that this order in council lias been passed.

It sometimes happens that workers are influenced or stampeded into taking action which on second thought they may regret. It is entirely in conformity with democratic procedure that the wish of the majority should govern. Under the provisions of this order, before any strike may take place following the report of a 'board established under the Industrial Disputes Investigation Act, the Minister of Labour must be notified that it is the desire of the workers that such strike take place; and in that event he may order that the vote be taken under the supervision of the officers of the Department of Labour.

All persons affected by the dispute are entitled to vote and the vote must take place without delay-in fact the order specifically provides that it must be taken within five days.

When the order was first passed it was subject to some criticism. It was criticized on the one hand by reason of the fact that it was too inadequate and was ineffective. It was criticized on the other hand because it interfered with the right to strike.

The fact is, however, that neither criticism was justified nor correct. It is a most democratic order and gives to every man and woman the right to say whether he or she wishes to participate in any strike and to forgo his or her wages during the time that any strike might be in progress.

I believe it is fair to state that the Department of Labour has in every way sought: first, to protect every worker by establishing fair wage standards and to prevent industrial strife; second, to protect the lower paid workers against attempts of unscrupulous employers to deny them the minimum compensation to which they are entitled; third,

Topic:   THE WAR
Permalink

EDITION


The War-Labour-Mr. McLarty to adjust any labour disputes as rapidly as possible; and fourth, to give workers in war plants throughout the country an opportunity to register their views, for or against a strike, after the findings of a conciliation board have been submitted. I should like to draw to the attention of the committee the creation of an entirely new body in Canada which has materially aided in the prompt investigation and adjustment of disputes which might have otherwise resulted in stoppages of work involving many thousands of men. Because of the application of the Industrial Disputes Investigation Act to all war industries, the number of applications for conciliation boards necessarily greatly increased. Each application had to be examined before a decision on its appointment was reached and the board itself was established. But even after a board was applied for, the conciliation services of the Department of Labour were continued. Both dealing with the application, and the work of the conciliation board, took time. The result was that complaints were made by labour organizations of delay between the time of the application for the board and its establishment. This caused some measure of discontent on the part of workers and the feeling that the delay in setting up such boards was unnecessary. It was felt that some action should be taken more promptly and effectively to deal with disputes in order that decisions might be more quickly obtained to determine whether the circumstances recited in the application warranted, by the nature of the dispute, the setting up of a board. The government in consequence created the industrial disputes inquiry commission. The personnel of this commission is, I believe, one that will commend itself to this house. Mr. Humphrey Mitchell, a former member of the house, a gentleman who has been associated with the Department of Labour for several years and who has an intimate knowledge of labour problems, was appointed chairman. Associated with him are Mr. Gilbert Jackson and Mr. George Hodge. The former is an economist of international repute, and the latter has been in charge of industrial relation matters for the Canadian Pacific Railway company for many years. This commission immediately assumed its duties, and its efforts in the prevention of disputes and in the adjustment of difficulties has more than met the expectations of the government. Fifty-two disputes in all have been referred to the industrial disputes inquiry commission for attention since the appointment of this body in the beginning of July. In twenty-two cases settlements were arranged' by the commission, resulting in a withdrawal of the applications which had previously been made for the establishment of boards of conciliation and investigation. In eight other cases inquiries made by the commission resulted in the establishment of boards of conciliation and investigation. In thirteen instances the inquiry commission found that the circumstances did not warrant the appointment of boards. There were, in addition, two special references by the minister to the commission, three instances in which the references are still outstanding, and other cases in which the facts were brought to the attention of the Minister of Labour. The creation of this commission has meant a tremendous saving in what would otherwise have meant lost man-hours, ill-will and discontent. This, it is fully realized, is inevitable where disputes either in being or threatening are not quickly adjusted. Might I point out that the Department of Labour is doing everything possible to provide facilities whereby training opportunities are provided for those who wish to obtain a knowledge of the trades and crafts that will permit the production of a still greater quantity of the munitions of war. This committee has heard something of the war emergency training programme in which the Department of Labour is engaged. We are now moving ahead of any programme and, for example, in our vocational classes are training more than 50,000 men a year. But we are moving much further than that. The war-time bureau of technical personnel was set up under the capable chairmanship of Mr. E. M. Little. He is entitled to appreciation for what he has already accomplished. The aid which this bureau has given and will give will be substantial. As an example, might I state that in the case of the newsprint industry, the utilities industry, the mines and in the field of chemical engineering a great many are now being trained for the express purpose of taking their place in war industry or enabling those who are already trained in those particular industries to take their place in industries engaged in war work. This committee will, I know, not forget that Canada was forced on very short notice to embark upon a huge programme of construction and production of war equipment and supplies. This required the setting up of additional machinery and meeting not only pressing present exigencies but emergencies. These have been met as effectively and promptly, I believe, as circumstances permitted. The War-Labour-Mr. McLarty I believe it is a matter of congratulation that notwithstanding a situation without parallel in our history, with the good-will of labour and industry, we have been able to adapt ourselves to the new situation. The policy of the government and of the Department of Labour in all that relates to production will continue to be that of doing everything possible to maintain harmonious relations between employees and employers. Recently the government passed an order stabilizing wages. I trust, Mr. Chairman, that in the references I make I shall not be guilty of too much repetition of what has been more ably said than I can say it, by the Minister of Finance. I do, however, have to deal with that phase of the general policy which he has explained, dealing with the matter of wages. As I have said, recently the government passed an order stabilizing wages. That order is part of a wider programme decided upon by the government in an attempt to prevent a vicious inflationary spiral recurring in Canada. Taxation on profits and on dividends had already been provided. The control of prices is now provided for. This stabilization of wages is not entirely new. For on December 16, 1940, the government passed an order in council which has been widely applied in war industries. The choice faced by the government at the time it was passed was to let wage rates take their unplanned upward course stimulating that spiral of inflation, or to introduce a measure of equitable control. The government selected the second alternative of trying to minimize changes in wage rates and, to some extent therefore, of prices and the cost of living. It ordered that in the essential war industries there should be no increase in basic wage rates except, where wages were found to be too low. The expression "freezing" has been used. This order is not a freezing order; it is a stabilizing order; because, if wages are too low, the board will have power to increase them.


CCF
LIB
CCF

Angus MacInnis

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

Mr. MacINNIS:

Well, on those to whom it applies?

Mr. MoLARTY: Oh, the order is mandatory, yes. But the point I was making was this, that wages can be increased if they are too low. The word "freeze" suggests an inflexibility that covers all.

Topic:   EDITION
Permalink
CCF

Angus MacInnis

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

Mr. MacINNIS:

I thought from the minister's earlier remarks that he was opposed to compulsion.

Topic:   EDITION
Permalink
LIB

Norman Alexander McLarty (Minister of Labour)

Liberal

Mr. McLARTY:

Well, it is mandatory on both sides. I mean, it is not just on one side. As I have said, the government selected the second alternative of trying to minimize changes in wage rates and, to some extent therefore, of prices and the cost of living. It ordered that in the essential war industries there should be no increase in basic wage rates and suggested that adjustments to increases in the cost of living should take the form of a separate cost of living bonus in a flat amount for all classes of workers.

To the extent that the maintenance of current wage rates does prevent an increase in prices and in the cost of living, wage-earners and all classes in the community, including the government in its capacity of the country's biggest buyer, will all clearly benefit. The heart of the policy is not to restore some previously high level of wages, but to prevent what might otherwise be a series of "runaway" increases from present levels. The purpose is not to "protect" any one class of citizens, but to ensure the conduct of our war effort by imposing the necessary sacrifices on all classes in an orderly manner.

Since some increase in the cost of living, however, was almost certain to result from the transfer of so large a proportion of our resources to the production of war materials and supplies, it seemed necessary and proper to assure, not that labour should be completely protected from price increases or from sharing reasonably in whatever sacrifices the war may require, but that the basic standard of living of the workers should be protected. For that reason the order in council generally known as 7440 provided, not that wage rates should be "geared to living costs" but that, by a flat cost of living bonus, uniform for all workers, any impairment of the basic standard of living and of productive efficiency should be prevented.

It is to be noted that the flat bonus, regardless of the worker's wage rate, will extend a very much greater measure of protection to the low-paid than to the high-paid worker and gears to the cost of living only the wages of those workers at or near a minimum level of subsistence and that part of the wages of other workers which is spent for basic necessities.

Our present wage policy was based upon the outstanding lesson learned as a result of our experience during the last war. In that period all belligerents financed their war effort in varying degrees by inflation. In all of them, despite all efforts at war-time controls, prices and the cost of living increased more rapidly than wage rates. On the one hand this led

The War-Labour-Mr. McLarty

to perhaps unintended but automatic profiteering; on the other hand, to arbitrary and capricious reductions in the *wage-earners' standard of living. A few favourably situated wage-earners were able, it is true, to enforce wage increases more rapidly than the cost of living rose, but for the majority of the workers the reduction in their standard of living was very substantial.

It is a fact, so well known to this committee, that real wages never keep pace with nominal wages that I need scarcely repeat it. Money, after all, is only a convenient medium of exchange. May I illustrate this by the experience of the last war. The Minister of Finance has already given certain figures in connection with it. Those figures relate particularly to wage rates and the cost of living. By 1917 the cost of living had risen 39 per cent, wages only 26 per cent. By 1918 the cost of living had risen 59 per cent, but wages only 47 per cent. Wage rates never overtook the cost of living during the whole period of rising prices.

This economic fact was a continual source not only of industrial friction, but, for certain groups, also of genuine suffering during the war period and made the necessary post-war readjustments proportionately more difficult.

That order in council which has become somewhat widely known as 7440 was directed to and formed the basis of awards of boards of conciliation appointed under the Industrial Disputes Investigation Act.

In the recent order respecting wages the essential principles remain the same, but changes have been made in its application and in its administration. These changes may be summarized as follows:

(1) The previous order was directed to conciliation boards appointed under the Industrial Disputes Investigation Act. As such it was necessarily limited to boards to which that act applied or to which its application was extended, at the request of labour on November 7, 1939, and which included all war industries in Canada. The present order extends to all industries, subject to certain limitations.

In the construction industry it applies where ten or more are employed. In other industries it applies where fifty or more are employed. The reason for the distinction is that in the construction industry a contractor while employing a large number might have few on one job. These minimum figures are fixed largely for administrative purposes and the administrative machinery is provided which will advise the government on such changes in these minimum numbers as may appear desirable.

[Mr McLarty.]

(2) It makes the payment of the cost of living bonus mandatory, subject only to the power of the national war labour board to determine that the employer is clearly unable to pay.

(3) It provides for an accounting period as to the proper amount of the bonus each three months.

(4) It provides for the creation of a national war labour board and of five regional boards which will be charged with the responsibility of administering the order and of ascertaining that its provisions are fairly and properly carried out.

In addition the national board has power to recommend to the government such matters as it may deem necessary, subject to the principles enunciated in the order in council, to which I have previously referred, passed on the 19th of June, 1940, and generally described as P.C. 2685.

I have outlined the general principles of the order. If I were to go into more detail I could do so only by reading the order itself to this committee. I fully appreciate the fact that a more detailed discussion will ensue upon it.

The only criticism that has been voiced is the measure of consultation with those affected before the order was passed. Well, the order invades the provincial field. We invited the provincial ministers of labour to a conference that was held on October 14. We asked them if they had objections to the passing of the order-because it did invade their field. When it was realized that the dominion government believed this measure was essential in our conduct of the war, no serious objection was raised by any province represented.

The Prime Minister and I met leading representatives of labour. Details of the order were not discussed; but I believe it fair to say they felt that the general principles of the order in council stabilizing wages should not properly be confined to war industries alone, but in the application should cover all industries. The order was submitted to the national labour supply council. That council made suggestions of a number of amendments, many of which were adopted.

I wish to be fair to this committee. I would not wish to convey the suggestion that because it was discussed with the various ministers of labour, with the leaders of labour organizations and with the national labour supply council, it was either approved or disapproved by all of those participating in these conferences.

Some suggested they had not the authority from their respective organizations either to approve or disapprove. I make mention of

The War-Procedure of the House

these consultations, however, to demonstrate that the programme was not lightly embarked upon or without great consideration being given to it.

But it is, after all, a war measure. The government in the last analysis must assume responsibility for its success or failure, and having ultimately to assume that responsibility, it must do so now.

The success of this measure depends upon its acceptance and its application by both labour and industry in Canada. That it will receive such acceptance and be fairly and impartially applied, I have no doubt. As each day passes, the people of Canada have shown in an increasing degree not only a willingness but a great desire to bear the irksome restrictions and the great sacrifices which war inevitably brings. This measure may be regarded by some as one of those restrictions and as one more of those sacrifices.

The government feels that it is essential to our war effort and will add to the effectiveness of that effort, as well as to the happiness and prosperity of the Canadian people after the war has been won.

Topic:   EDITION
Permalink
LIB

William Lyon Mackenzie King (Prime Minister; Secretary of State for External Affairs; President of the Privy Council)

Liberal

Mr. MACKENZIE KING:

The committee will recall that under the arrangement made with respect to procedure, it was understood that after the leader of the opposition and the leaders of the two groups had spoken, the ministers who have been charged principally with the administration of Canada's war effort would each make a formal statement, and that when their statements had been concluded the house would continue in committee and, if so desired, discussion would follow on the subject matter of the several statements that had been made. In order to preserve relevancy and to avoid as much in the way of overlapping as possible, it was thought that it would be well to take up the discussion in committee in the same order in which the statements themselves had been presented. The formal statements of the ministers whose departments have chiefly to do with the war effort have now been made, and if we follow the procedure that was agreed upon we will now begin with the statement made by the Minister of Munitions and Supply and have an open discussion upon any matters which hon. members may wish to bring up on matters pertaining to munitions and supply, and then follow with discussion upon the statements of the other ministers, each in the order in which the ministers themselves have made their statements.

I should like to make this clear. There is no desire on the part of the government, and I am sure there was no desire on the part of the leader of the opposition or the leaders of

the groups in the house, in arriving at this arrangement, to preclude anyone from saying anything he pleases, so long as it is politely said, and to make any statement he may wish to make which in his opinion might be related to Canada's war effort. But some order will have to be followed, and I would suggest that we adhere to the one which was proposed and which is set out in Hansard of Tuesday, namely, to take the statements of the different ministers, following the order of their presentation. When that discussion is concluded, if there are other matters which any members wish to have discussed, they might be taken up at that stage. I do not wish to be a dictator, even as respects the procedure of the house. What I suggest is to facilitate orderly discussion. Perhaps we could make most headway were we to adjourn now and begin to-morrow the more general discussion, starting with the statement made by the Minister of Munitions and Supply.

Topic:   EDITION
Permalink
NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

Before

the motion to adjourn is put, I should like to say this. At the conference to which the Prime Minister has referred, at which I was present together with hon. gentlemen representing the two other parties, I thought it was made clear that certain members of this house would like to give expression to their views after having heard the ministers and before we reached the stage of question and answer. If I did not make myself absolutely clear to the Prime Minister, that is my fault. There are members on this side, two or three-I do not know just how many-who would like to make extended remarks of their own, and I certainly suggest that it would be a great mistake if they were not allowed to do that. Therefore, I agree at once to the suggestion that we adjourn, but with the understanding that if anyone wants to speak at three o'clock to-morrow he be entitled to do so. There may be hon. gentlemen on the other side who would like to speak.

We have listened with the most intense interest to-day to three very important speeches-the speech of the Minister of National Defence (Mr. Ralston), the speech of the Minister of Finance (Mr. Ilsley), which to me was very interesting and which, of course, I found it quite difficult to follow, and the speech of the Minister of Labour (Mr. McLarty), which requires some analysis. I should not leave out my hon. friend the Minister of National Defence for Air whose speech was short and understood, I think, by us all perfectly. I should not like to have it even suggested that if anyone wants to make any extended remarks here to-morrow he should be shut off. I hope the Prime Minister will grant

The War-Procedure oj the Home

that freedom of expression which characterized the statements maxie at the earlier stages of this session and before we had our meeting, that there was no disposition at all to shut out anyone who wants to make any remarks at this time in this house. I hope that will be adhered to.

Topic:   EDITION
Permalink
LIB

William Lyon Mackenzie King (Prime Minister; Secretary of State for External Affairs; President of the Privy Council)

Liberal

Mr. MACKENZIE KING:

The purpose of having the house sit in committee of the whole was to afford the greatest possible latitude to hon. members to say whatever they thought they should say with respect to the carrying on of the war by the administration. What I have said about following a particular order is according to what was my understanding at the time. There were other group leaders present, they will know whether I have interpreted the agreement reached aright or not. But let me say at once to my hon. friend the leader of the opposition that if there are members of his party or of any party who desire to speak immediately and not wait to take up the statements in the order I have suggested, as far as I am concerned I am perfectly willing that they should have the precedence to-morrow and to have to-morrow's proceedings start with their speeches. The whole purpose of the government in the sittings of the house at the present time is to have the fullest possible discussion of matters of public concern and interest.

Topic:   EDITION
Permalink
IND

Alan Webster Neill

Independent

Mr. NEILL:

We are dealing in a very

unusual way; I do not think I ever heard or read throughout the history of Canada where a parliament sat in committee and apparently discussed everything at large, nothing before the house, no resolutions, no estimates, and apparently it is impossible for us to move a resolution or propose amendments. Might I ask the Prime Minister if it would be in order under these very unusual circumstances for any hon. member to move a motion in this committee in order to give expression to or test the feeling of the house on any particular subject?

Topic:   EDITION
Permalink
LIB

William Lyon Mackenzie King (Prime Minister; Secretary of State for External Affairs; President of the Privy Council)

Liberal

Mr. MACKENZIE KING:

My hon. friend says there never was procedure like this; there never was a war like the present. I might remind my hon. friend that the session of parliament was virtually over when we adjourned last June. This is an extra that comes at the end of the session. The government might have called hon. members together and adjourned without opportunity for discussion at all. But the last thought in our minds was to deny anyone the opportunity of discussing anything in any way he pleased so long as it was calculated to further Canada's war effort and have it fully understood. We could not think of any method

that would afford more latitude than to have the house sit continuously in committee. We realized that it was a novel procedure, but one that certainly could not be taken exception to on the score of the government trying in any way to prevent full and free discussion.

However, when it comes to what my hon. friend suggests, the moving of motions or bringing in of amendments to supply and the like, I am afraid that for that procedure we shall have to wait until the next session and the government brings down its programme and we proceed again in the regular way.

Topic:   EDITION
Permalink
CON

Joseph Henry Harris

Conservative (1867-1942)

Mr. HARRIS (Danforth):

Following the

same idea, it was brought to the attention of the Prime Minister this afternoon that since we were last in session here there have been certain committees sitting during the recess. It would be very interesting, and I think it is necessary, that the chairman of the committee and the chairman of the subcommittees, one very important sub-committee at least, should give the house and the country the benefit of their observations on a very important matter, and perhaps we should have an opportunity to discuss what they have done and what they purpose to do, or are we going to forget all about it?

Topic:   EDITION
Permalink
LIB

William Lyon Mackenzie King (Prime Minister; Secretary of State for External Affairs; President of the Privy Council)

Liberal

Mr. MACKENZIE KING:

I think I said, in reply to a question this afternoon, that I would give the house a little later on further information as to what is to be considered of the work of existing committees. Perhaps my answer to my hon. friend can stand.

Topic:   EDITION
Permalink

November 6, 1941