Right Hon. W. L. MACKENZIE KING (Prime Minister):
I have another statement, Mr. Speaker, which I should like to make to the house. It has to do with restrictions upon the sale of beer.
On December 16, 1942, the government, by an order in council known as the wartime alcoholic beverages order, limited the quantity of spirits, wine and beer to be released for sale in the period from November 1, 1942, to October 31, 1943, to 70, 80 and 90 per cent respectively of the quantity released in the previous twelve months. The period of this limitation was subsequently extended for the duration of the war.
The restrictions upon the quantity of alcoholic beverages to be released for sale, were in accordance with the government's policy, to effect, if possible, a total war effort. They were in response to an informed public opinion, and to a widespread public demand for some measure of restriction. It had become evident throughout 1942, and even earlier, that increased production and excessive consumption of alcoholic beverages at a time of war could not but impair the effectiveness of the country's war effort.
In the first three years of war, the consumption of alcoholic beverages had increased enormously. Over the same period, restrictions had been increasingly imposed upon the use of many commodities, including not a few of the necessities of life. Restrictions had also been placed upon the use of gasoline and upon travel abroad as well as at home. Moreover, the country, by the close of 1942, had reached practically the peak of shortages both of man-power and materials. The government was making every effort to divert men and resources from non-essential activities of all kinds. This policy had already affected the production of alcoholic beverages. The entire distilling capacity of the country had been converted to the manufacture of industrial alcohol for war purposes. The production of wine had been limited by the rationing of sugar. The production of beer had been restricted by a limitation in the supply of malt.
The wartime alcoholic beverages order did not, therefore, actually greatly increase the restrictions on the supply of alcoholic beverages. The basic limitation was, in fact, the result of war-time demands for man-power and materials for essential war needs. The restrictions did provide for an orderly and
equitable distribution of the available supplies among the several provinces in exact proportion to the quantities released for sale in each province in the preceding year.
I wish to emphasize the fact that, with respect to alcoholic beverages, the federal limitations apply only to the quantities released for sale to each of the provinces. The retail sale and distribution of alcoholic beverages is left entirely to the provincial authorities.
It was clear from the outset that the war-time alcoholic beverages order, like other war-time restrictions would be effective only if the necessary cooperation and support was forthcoming on the part of the several provinces of the dominion. It was for this reason that at the time the order was enacted, I took care to explain in a public address the relations of the dominion and provincial governments with respect to the production and sale of alcoholic beverages, and to make a special appeal to the provinces to lend their cooperation. This I did in the following words:
The federal government has to do with their (i.e. alcoholic beverages) production and importation; the provincial governments with their sale and distribution. In other words, while the dominion government is in a position to control the quantities of spirits, wine and beer to be released for consumption, the regulation of the retail sales of alcoholic beverages is a matter which is determined by each province according to its judgment. . . .
An examination of existing war-time needs now makes it necessary for the federal government, in addition to the measures I have announced, to appeal to the provinces for their cooperation in further restricting the sale of alcoholic beverages.
In the case of most of the provinces there has been a gratifying effort to cooperate. There has been notwithstanding, much misrepresentation throughout the dominion of the government's purpose, and, as time has gone on less and less has been said about the reasons for and the limited scope of the restrictions themselves.
Within the past few days a situation has arisen in relation to two of the provinces which is so far removed from cooperation on the part of their governments that it is certain to give -rise to an issue between the federal -and provincial authorities. If not promptly prevented, any such issue cannot fail to create continuous friction between some of the provincial governments and the federal government, and antagonisms between one section of the country and another.
In Ontario, on the authority of the liquor control board, -notices have been posted in establishments where alcoholic beverages are sold, which read as follows:
Notice: The quantity of alcoholic beverages saleable at this sales outlet is restricted by reason of order in council No. 11374 passed by the federal government Dec. 16, 1942.-This notice is posted on authority of the Liquor Control Board of Ontario.
There is no indication in these notices that the action of the federal government was a war measure, enacted to increase the country's total war effort. No account is taken or mention made of the fact that the production and consumption of alcoholic beverages in 1942 had reached the highest level in Canada's history. Instead, the poster is designed to have it appear that, in the opinion of the government of Ontario, the action of the federal government is arbitrary, unfair and unnecessary.
Since the enactment of the dominion wartime alcoholic beverages order, there has during the year been released for sale in each province of Canada, ninety per cent of the beer which was released for sale in the twelve months ended October 31, 1942. Over the whole country, this amount was some sixty per cent in excess of that which had been released for sale in the year prior to the outbreak of war. To-day the beverage rooms of Ontario, where the notices of the Ontario Liquor Control Board are posted, are not being allocated 90 per cent by the board. Instead, they are being allotted only 75 per cent. It is true that the quantity saleable in the province has been restricted by the dominion order in- council,, but it was not restricted by 25 per cent. That restriction on the beverage rooms was imposed by the liquor control board of Ontario.
The board's action has the approval of the government of Ontario. It was defended by the Attorney General of Ontario in the Ontario legislature on the 8th of this month. The posting of the notices certainly misrepresents the action of the federal government. It is clearly an attempt to have the federal government held responsible for the whole twenty-five per cent reduction.
On the day before (March 7), in the Alberta legislature, the provincial treasurer is reported to have stated that "some of the eastern provinces were tipped off" to the wartime alcoholic beverages order of 1942, and that the dominion government "fixed the base year to give the greatest advantage to Quebec".
The Minister of National Revenue has completely denied this statement in the following words: [DOT]
Such a statement is entirely without foundation and untrue and not one that would normally be expected to be made by a responsible minister of the crown.
While Mr. Low complains of the quota allowed to his province, it might be pointed 100-88
out that in the year ending October 31, 1943, the province of Alberta failed to take up its full allotment, and was short 9,945-6 proof gallons of spirits to which the province was entitled.
If effect is to be given its war-time policies, the federal government must necessarily rely upon the cooperation of the provincial governments. This, as I have pointed out, is particularly true of war-time restrictions upon the supply of alcoholic beverages. Despite the fact that the supply is affected by shortages of essential materials and man-power, and the further fact that the federal restriction is merely a restriction upon the quantities released to each province, the public has been increasingly led to believe that the supply available for consumption, and any difficulties of distribution, are due solely to action on the part of the federal government.
In the case of spirits and wine, the reasons for the limitation of supplies are, I believe, generally understood and generally accepted. The misrepresentations and the controversies which have arisen have to do largely with the restriction upon the supply of beer.
In the case of beer, the supply is limited by shortages of malt, of bottles, of cartons and of man-power, which are likely to continue as long as the war lasts. Apart altogether from *the 10 per cent reduction imposed by the wartime alcoholic beverages order, the shortages of themselves would prevent any very considerable increase in supply. No right thinking person would advocate the diversion of scarce materials or man-power from any essential war-time or civilian activity to the production of beer.
At this time of war, it is especially true that a first duty of the federal government is to see that no differences which can be prevented are allowed to interfere with the cooperation and understanding so necessary between the federal and provincial governments. In the interests of the war effort, sources of public misunderstanding and friction, where they exist, should be removed in so far as that may be possible.
The provinces, under their power to regulate the distribution and sale of beer can effectively limit the amount to be distributed1 and sold, and this quite apart from any federal restriction as to the amount to be released for sale. Where it is clear that causes other than federal action are restricting the supply of beer, maintenance by the federal authorities, of the 10 per cent reduction upon the 1942 output of this single commodity is not sufficiently important to the war effort to justify the risk of continuous misunderstanding and friction between the fed-
eral and provincial governments and of antagonisms between provinces. In these circumstances, it is obviously preferable that the distribution and sale of such supply of beer as there may be, should be left to the exclusive control of the provinces themselves.
The government has therefore decided to remove the restriction of ten per cent upon the supply of beer which may be released for sale to the provinces, and the wartime alcoholic beverages order has to-day, been amended accordingly. _
In leaving to the provinces the exclusive responsibility for the amount of beer to be distributed and sold, the federal government is not departing from its view that a restriction of the production and consumption of alcoholic beverages is necessary to a total war effort. In all particulars, except the one mentioned, the wartime alcoholic beverages order will remain as it is.
As respects the retail distribution and sale of beer, each province is now freed from any federal restriction as to quantity of beer to be released for sale within its borders. The provinces will have the sole responsibility to make whatever arrangements each considers necessary and desirable to ensure an equitable distribution and to prevent any excesses.
Mr. Speaker, I now table copies of the order in council which was passed to-day.
Subtopic: REMOVAL OP FEDERAL RESTRICTION ON SUPPLIES OF BEER TO PROVINCES