November 23, 1945


Frank Eric Jaenicke

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

Mr. F. E. JAENICKE (Ivinderaley):

Mr. Speaker, I agree with much that has been said by the hon. member for Lake Centre (Mr. Diefenbaker) in the able argument which he has just presented to the house. However, I am not able to follow him all the way. I do not agree, for instance, that we should have a separate bill for each necessary control, as I understood him to suggest. I believe that we can amend the bill now before the house so as to restrict the government to the controls which it actually needs at this time.

To us in this comer of the house the whole act is repugnant, as it must be to anyone who adheres to the principles of political democracy. We are as anxious as anyone that controls be lifted, and that we depart from the vicious practice of legislating by order in council. As was stated clearly by the Minister of Finance (Mr. Usley) only a few days ago, the main function of parliament is to legislate, and the sooner we revert to this exclusive function in its entirety, the better. It will always be the duty and the province of the ministry to set up rules and regulations to enforce laws passed by

National Emergency

parliament, and that, of course, is legislation in a way, but only what I may call secondary legislation.

The bill before us, however, enables the ministry to legislate and enact substantive law, and, generally speaking, that is intolerable in democracy in ordinary times, the more so under our constitution because the government by such legislation not only takes over the function of parliament but interferes seriously with the powers of our proyinces with respect to subjects which are specifically assigned to provincial legislatures. If we were living in ordinary times, we would undoubtedly oppose the passing of such a bill most vigorously.

This measure is to be called the National Emergency Powers Act, and the preamble states in part:

... it is necessary for the peace, order and good government of Canada that during the period of transition to normal from the exceptional conditions existing during the war, with the attendant dangers and responsibilities for the nation as a whole, acts and things done and authorized and regulations and orders made under the War Measures Act be continued in force and that the governor in council be authorized to do and authorize during the said period such further acts and things and make such further orders and regulations as he may by reason of the national emergency resulting from the war deem necessary or advisable for the security, defence, peace, order and welfare of Canada.

It is this preamble, in my humble opinion, upon which we have to make up our minds. Is there a national emergency and is it necessary that during the period of transition to normal, with the attendant dangers, the regulations and orders under the War Measures Act be continued in force, and that the government be empowered to make further orders by reason of such national emergency resulting from the war, assuming that such national emergency now exists?

I believe that the important point to consider is this, whether the dangers and the extraordinary circumstances resulting from the war are still with us, and whether we believe this to be a state of fact. If we do, we must endorse the principle of this bill.

I have come to the conclusion that for the security, peace, order and welfare of our nation some of the orders and regulations already passed must be continued and that the government must retain certain powers to make further laws for that purpose.

I have tried to draw a picture in my mind of what might happen if the government to-day proclaimed the war at an end, which would automatically suspend the War Measures Act and repeal the orders and regu-

lations made by virute of that act. The picture that forms itself in my mind would be one of utter confusion and chaos. We must not forget that it was largely by the powers granted to the government under the War Measures Act that Canada was able to make her notable contribution to total war in the field of war production; and in order to reconvert to a peace-time economy we must retain some of these controls. The government must have some of these powers so that reconversion may be orderly, or at least as orderly as possible. Otherwise, in the mad scramble back to the promised land of free enterprise, a lot of people will be crushed, and I am afraid that it will be largely the little man- the forgotten man-who will suffer the most. Therefore, I shall vote in favour of the second reading of the bill, and endorse its principle.

But we shall reserve our right to introduce amendments when the bill is in committee. For all practical purposes the bill contains the same wide powers contained in the War Measures Act, and we believe that this is unnecessary since the actual shooting is now over. It is true that some of the subject matters enumerated in section 3 of the War Measures Act have been left out of section 3 of this bill, but in any event the enumeration of the subjects in section 3 of this bill is made meaningless by, the words contained in the first subsection, "but not so as to restrict the generality of the foregoing terms." That phrase is all right in time of war, 'but I maintain that it is not necessary in time of peace. I contend, as did the hon. member for Lake Centre, that the government should state the specific powers which it needs to legislate, and should restrict itself to those powers. If we leave in the bill the word's which I have just quoted the government would not be restricted to the subject matters specifically enumerated in section 3 but would have the wide powers which it had before. We shall govern ourselves according to the explanation that is given when the bill is in committee, and I trust that the government will see its way clear to accept an amendment which will restrict the powers it seeks to the subjects specifically enumerated in section 3, as such subjects may be amended and finally passed by the committee.

We also take exception to some of the subjects enumerated1 in section 3 of the bill, or at least we shall have questions to ask as .to why the government deems it necessary to have certain of these enumerated exceptional powers. We consider paragraph (g) entirely unnecessary. It is the paragraph referring to entry into Canada and deportation and also the revocation of citizenship. This paragraph

National Emergency

alone is capable of promoting a first-class debate on discrimination and kindred acts of intolerance so repulsive to a British democracy; but I say that the powers sought in this paragraph are entirely unnecessary. Why should the ministry wish to include powers which they already have by virtue of laws now on the statute book and duly passed by this parliament? The minister in charge of immigration has full power under, I believe, section 4 of the act to admit into Canada anyone as he deems fit; he has also the power of exclusion and deportation; and as far as revocation of nationality is concerned, this is fully covered1 by the new citizenship bill at present before parliament.

We shall also take objection to the wording of subsection 4 of section 3 of the bill before us, and already referred to by the previous speaker. This subsection reads as follows:

Every order in council made under this act shall be laid before .parliament as soon as may be after it is made.

The principle enunciated in this subsection is a good one, but the wording is too vague, and it is only to make it more specific that we intend to introduce an amendment to this subsection to provide for the orders in counr-cil to be laid before parliament within a specified time, and, if parliament is not in session, that these orders in council be published in the Canada Gazette immediately, so that all members of parliament may at once be cognizant of these laws passed by orders in council. Parliament should also assert its supremacy by retaining the power to annul such orders in council. There is nothing new or revolutionary in the amendment which we are going to propose. Other acts of parliament of Canada as well as of Great Britain contain these provisions, and I think that if parliament is willing to grant to the ministry these extraordinary powers of legislation, they will not object to a clause which will assert the supremacy of parliament, which is the fundamental principle of the whole of our constitutional law.

I am occupying only a few minutes, because I think the bill ought to be passed, that we ought to "make time"; and we believe that it should receive second reading without undue delay, that the principle should be endorsed, and that such amendments should be made in committee along the lines which I have indicated.

Mr. SOLON E. LOW (Peace River): Mr. Speaker, may I take just a few minutes to place before the house, in a completely objective way, and with the desire to engender more light than heat, a view regarding the legislation which is now before the house.

Bill No. 15 in effect extends the life of the War Measures Act for another year, on the assumption that it is advisable for the security, defence, peace, order and welfare of Canada.

I hope .every hon. member is perfectly clear as to the implication of the whole bill and as to what the Prime Minister (Mr. Mackenzie King) and his colleagues of the cabinet are asking them-asking them, I say, as the accredited representatives of the people and the custodians of democracy in Canada-to do by approving bill No. 15. The cabinet is asking this house to set aside the national constitution, the powers, rights and privileges of parliament, the sovereign authority of the people, and the constitutional autonomous rights of the provinces, so well spoken of by the hon. member for Lake Centre (Mr. Diefenbaker). In effect, it seems to me, they are asking parliament to abrogate democracy in Canada and to vest complete and absolute power in the Prime Minister and the cabinet.

Now the members of the cabinet are asking parliament to confer upon them the power to do and authorize such acts and things and to make from time to time such orders and regulations as they may deem necessary or advisable for the security, defence, peace, order and welfare of Canada. Under these absolute powers any order and/or regulation issued with the approval of the cabinet by some self-opinionated bureaucrat with an inflated idea of his own self-importance is to have all the force of law.

In addition to these absolute powers, and evidently to avoid the* odium of having to enact orders that have the force of law for the purpose of suppressing free speech, criticism of government policies, and the general system of regimentation introduced during the war period, the government is asking parliament to approve and authorize the continuation of all those war-time measures which marked our decline into the totalitarian state while our men were fighting totalitarianism on the battlefronts of the world.

That, Mr. Speaker, is the substance of the bill. Sometimes, I find, it is good for all of us to take a straight look at the whole ugly picture. I put it very bluntly, I know. But I ask now that hop. members will answer this within themselves: Could Hitler or any other dictator with whom the world has been afflicted during these disastrous years of human history have asked for more complete and absolute power? What could not be included in the power to "do and authorize such acts and things and make from time to time such orders and regulations" as officials of government may deem it necessary? Incidentally, it appears that the cabinet seeks the power, as

National Emergency

set out in section 4, to enforce those regulations even to the point of confiscating p'roperty, seizing goods, or prescribing penalties for disobeying the Pooh-Bahs-I like that word, which I learned last night from the hon. member for Muskoka-Ontario (Mr. Mac-donnell)-of the vast state bureaucracy that has grown up in Canada during the war years.

The government pleads that these powers are necessary because we face a national emergency. People all over the country are asking, just what is the nature of this emergency? The war against Germany, Italy and Japan is at an end. The men and women of the armed services, after four, five and six years of regimentation, discipline and taking orders, are coming back with high hopes of being able to enjoy the freedom for which they have been fighting. They are finding at home regulated, controlled1, inspected and bureaucracy-written industries, agriculture, and business firms, that are attempting to readjust themselves to peace-time conditions. If ever there was a time when the path to progress should be cleared of all unnecessary controls and restrictions, when people should be free and unhampered to tackle the great task of reconstruction which lies before them, when the flood-gates of abundant production should be opened wide, it is now.

Spokesmen for the government will reply that if the controls which exist were to be removed now, chaotic conditions would result. As the Minister of Justice (Mr. St. Laurent), has pointed out, prices would rise and greater labour unrest would follow. The short answer to that, of course, is that the government, though warned repeatedly about the dangers ahead, have persisted' in remaining within the confines of a debt-creating system of finance by which they have actually created for themselves the very problems which they now seek absolute powers to control.

Under a sound democratic and scientific system of finance, neither inflation nor deflation could threaten our economy. At the same time, I must admit, it is a fact that under our present debt-ridden and restrictive money system, both inflation and deflation, with all their disastrous consequences, do threaten our economy. These dangers cannot be dealt with satisfactorily through controls that place in the hands of individuals great power and authority over their fellow men because, as the war has so definitely proved, when one control is introduced to cure human problems it inevitably creates more and other serious problems. In my judgment, the only effective controls are those which are inherent in a justly scientific economic structure that, by its very fairness and justice, induces the

full support of all classes of the community and which will be freely sustained without compulsion of any kind.

We are prepared to grant that the government requires temporarily to exercise a measure of control over price structures, foreign exchange, export and import of goods, and so on; but is that any reason why parliament should abrogate its authority and give the cabinet the power to do any act or thing which the cabinet may deem necessary? Apologists for the governlnent will answer, of course, that the government must lay before parliament the orders in council which it does pass. The members of this house must know that means little or nothing. Even Hitler would condescend from time to time to report to the reichstag what he had done by his own special dispensations, and his report was always met by cries of "Heil, heil", for what else could be said on matters over which they had no power whatever?

Yes; orders in council will be laid before parliament; they will be published in the Canada Gazette; but that will in no way detract from the powers for which the Prime Minister and his colleagues are now asking in this bill. There are a good many considerations which members should have in mind when voting on bill No. 15. I have not very much time to deal with all of them, and therefore I shall limit myself to just one or two of the most important.

In the first place, during the war the government of this country exercised very wide powers. They created a vast bureaucracy for the purpose of exercising a mass of controls and prohibitions to deal with the emergency which they saw before .them. Men were appointed to positions where they wielded great power, and some of them became petty despots. I can assure the house of that. To be perfectly fair about the matter, I think that under all the circumstances, and taking everything in balance, they did in the main a pretty good job of preventing chaotic conditions in our country. But it is an axiom that all power corrupts, and absolute power corrupts absolutely. The measure of corruption which does take place in any army of bureaucrats is in direct proportion to the power that they have been wielding; and so, sir, Canadians should now keep their eyes wide open, now that the war is over and we have returned to a condition of peace.

These bureaucrats do not want to lose their jobs. They do not want to lose their power. It is always far easier to build up a bureaucracy than to tear one down after 'it has become thoroughly established in the country.

I warn the government that they will have

National Emergency

plenty of trouble to get rid of the deadweight of the vast machinery that has grown up during war time, and therefore they should be indicating to the people of Canada right now their,honest determination to bring about in Canada at the earliest possible time that happy condition in which our people can live in freedom without having hordes of insolent bureaucrats continually prying into every phase of their existence.

I cannot advance any stronger argument to my hon, friends on the other side of the house for the exercise of exceeding great care than to remind them again that absolute power corrupts absolutely. This- bill asks for absolute power to be vested in the government. Surely it would not only be in the best interests of Canada but be a kindness to the government themselves if t'he members of this house saved hon. members opposite from the absolute corruption which might be their fate if they secured the absolute powers which the bill would confer upon them.

As for the power seeking bureaucrats who are involved behind the scenes-and I am satisfied there are plenty of them-I submit that it is time for them to become -again just ordinary citizens and to work out of their systems the tendencies they have acquired while they have wielded such great powers as they have been wielding during this war. The habit of wielding power grows by leaps and bounds. It has all the danger of a cancerous growth. I am perfectly well aware, of course, that it is not foreign to some men to deny themselves the glamour and the privilege which the exercise of power does bring, but I say that more normal men quickly succumb to its most insidious appeal.

It has always been repugnant to the British people and to a democracy such as ours to leave things to a great body of so-called experts. That was an obviously necessary condition during the war, but we should all remember that the war was fought to blaze the trail for a new economic system, what the Prime Minister was pleased to call the "new order". The principles upon which this new order should be built must evolve out of the people and should be expressed through their elected representatives in this parliament. It should not in any sense be considered to spring from a group of bureaucratic experts who might wish to impress their will upon the people.

I turn now briefly to another aspect of the whole matter. Is it just a coincidence that both during the war and since the end of the war we have witnessed in every democratic [DOT] country in the world1 a rapid advance 47696-156J

toward the totalitarian state condition? In Great Britain, in the United States, in. Australia, and in New Zealand, increasing centralization of power in the national political executive, increasing bureaucracy, more and more controls, together with the policy of harsh taxation going hand in hand with a pyramiding debt and growing regimentation have been introduced in a form which indicated from the outset that the intention was to continue, if not all, at least a great many of the controls and regimentations into the post-war period. In Australia, the federal government asked for increased powers. They did so by referring the whole matter to the people in a plebiscite, and despite the fact that they were still at war, the people of Australia turned down the government's bid for power and denied them the extra ones for which they asked.

In Great Britain, as has already been pointed out only too well, the newly elected Socialist government has given itself power to exercise virtual dictatorship for another five years but, as was ably pointed out by the hon. member for Lake Centre, no such dictatorial powers has it asked for as are asked for in bill No. 15.

In the United States it would appear that the exacting system of controls of war time will continue in operation for some time to come. Evidently, Mr. Speaker, nowhere in the world to-day is there left the semblance of democracy which existed before the war. Everywhere, even, in countries with democratic constitutions, the totalitarian concept in a greater or lesser degree has become entrenched as a result of our bitter struggle against the countries which were determined to fasten totalitarianism upon the world.

My reason for mentioning these things is simply this: Unless we in Canada determine

now to lead the way out of the darkness of a world in which democracy is in eclipse; unless we consciously and determinedly set about the rehabilitation of a democracy rendered anaemic by the exigencies and practices of war time; then, despite the fact that nazi Germany and Hitler have been defeated in war, Hitler's ideas and the Hitlerian cult may emerge victorious in the end!

I do not wish to prolong the discussion, but I did feel that I should make clear my position and that of the Social Credit group with respect to the whole matter of continuation of emergency powers We consider that the government should not seek such blanket and absolute powers as are set forth in clauses 3 and 5 of the bill, especially as parliament will be almost constantly in session during the next seven or eight months. We think it is possible

Private Bills

for the government to specify fairly definitely the particular powers of control necessary to meet the requirements of the present state of emergency. These only should be voted by parliament at this time. If other emergencies arise, which cannot now be foreseen, parliament can- be asked to deal with them. Past experience has shown that this house can act with reasonable speed when danger threatens either from some external source or from the development of internal situation. Therefore I would ask the government to amend the bill along the- lines of the suggestions which have already been made. When this bill is before the committee we shall be prepared to propose certain amendments. I would ask the government to amend the bill to make it more acceptable to those of us who are unprepared to grant the absolute powers called for in section 3. The government should also set out at once to do everything in its power to open wide the flood-gates of production in Canada, so that it will not have to come back and ask this parliament for any extension of emergency powers when the term of the present bill expires.

On motion of Mr. Pouliot the debate was adjourned.

At six o'clock the house took recess.

After Recess

The house resumed at eight o'clock.




Bill No. 24, to incorporate the Canadian Jewellers Institute.-Mr. Jackman. Bill No. 25, to incorporate Dominion General Benefit Association.-Mr. Ross (Souris). Bill No. 26, to incorporate Ottawa Valley Trust Company.-Mr. Mcllraith. Bill No. 29, to amend an Act respecting Vancouver, Victoria and Eastern Railway and Navigation Company, The Nelson and Fort Sheppard Railway Company and Great Northern Railway Company.-Mr. Reid. Bill No. 28, respecting The Quebec Railway, Light and Power Company.-Mr. Lesage. Bill No. 30, to incorporate International Air Transport Association.-Mr. Mcllraith. Bill No. 31, to incorporate The Arctic Institute of North America.-Mr. Benidickson. Mr. RALPH MAYBANIC (Winnipeg South Centre) moved that Bills Nos. 34 to 90, inclusive, be read the second time.


Paul-Edmond Gagnon



On division.

Motion agreed to and bills read the second time.

Bill No. 37, for the relief of Mildred Euretta Mackay Disher.-Mr. Emmerson.

Bill No. 38, for the relief of Mary Emerson W'hittemore Schlemm.-Mr. MacLean.

Bill No. 39, for the relief of Andrew Lawrence Card.-Mr. Maybank.

Bill No. 40, for the relief of Annie Morrison Wisely Pitblado.-Mr. McGregor.

Bill No. 41, for the relief of Joe Eisen.- Mr. Maybank.

Bill No. 42, for the relief of Ellen Therese Cramer Watson.-Mr. Maybank.

Bill No. 43, for the relief of Rita Gendron Reid.-Mr. Brown.

Bill No. 44, for the relief of Evelyine Pearl Edwards Aird.-Mr. Emmerson.

Bill No. 45, for the relief of Helen Turned Luke.

Mr. Hazen.

Bill No. 46, for the relief of Lois Elizabeth Allworth Pierce.

Mr. Emmerson.

Bill No. 47, for the relief of Armandine Cecile LeBrun Lachance.-Mr. Emmerson.

Bill No. 48, for the relief of Grace Irene Paquet Hopkins.-Mr. MacLean.

Bill No. 49, for the relief of Alma Joan Begin Oswald.-Mr. Hazen.

Bill No. 50, for the relief of George Ernest Reed.-Mr. Maybank.

Bill No. 51, for the relief of Sylvia Heather McCulloch Peck.-Mr. Maybank.

Bill No. 52, for the relief of Frederick Keith Beattie.-Mr. Emmerson.

Bill No. 53, for the relief of Robert Coull. -Mr. Homuth.

Bill No. 54, for the relief of Violet Beach Meredith.-Mr. Croll.

Bill No. 55, for the relief of Max Engel-berg.-Mr. Casselman.

Bill No. 56, for the relief of Bertha Harris Fineberg.-Mr. Maybank.

Bill No. 57, for the relief of Nils Jens . Pettersen.-Mr. Hazen.

Bill No. 58, for the relief of Benjamin Charles Stafford.-Mr. MacLean,

Bill No. 59, for the relief of Florence Mary Daniel Nightingale.-Mr. Benidickson.

Bill No. 60, for the relief of Edward Stephen Vasselin.-Mr. Homuth.

Bill No. 61, for the relief of Robert Marshall Miller.-Mr. Merritt.

Bill No. 62, for the relief of Dorina Laurin Wallis.-Mr. Casselman.

Bill No. 63, for the relief of Helen Louise Clark Leet.-Mr. Maybank.

Bill No. 64, for the relief of Dorothy Anita Duffy Gregson.-Mr. Casselman.

War and Demobilization

Bill No. 65, for the relief of Irene Grace Hannan Smith.-Mr. Casselman.

Bill No. 66, for the relief of Lorna Maud Clerk Kingsland.-Mr. Casselman.

Bill No. 67, for the relief of Edgar Jean.- Mr. Maybank.

Bill No. 68, for the relief of Ethel Maybird Wright Latreimouille.-Mr. Croll.

Bill No. 69, for the relief of Marie Rose-Alba Germaine Belair Blanchard. - Mr. Cleaver.

Bill No. 70, for the relief of William Bernard McCarrick.-Mr. Croll.

Bill No. 71, for the relief of Lome Edward Souva.-Mr. Casselman.

Bill No. 72, for the relief of Edith Gertrude Jackson Holloway.-Mr. Maybank.

Bill No. 73, for the relief of George Allenby Bradshaw.-Mr. Maybank.

Bill No. 74, for the relief of Phyllis Fitch Farber.-Mr. Maybank.

Bill No. 75, for the relief of Vencel Hume-nay.-Mr. Rose.

Bill No. 76, for the relief of Waldo James Cousins.-Mr. Maybank.

Bill No. 77, for the relief of Albert Wilson Harvey.-Mr. Maybank.

Bill No. 78, for the relief of Iris Ester Westerberg Duffy.-Mr. Smith (York North).

Bill No. 79, for the relief of Della Frances Gardner Hudson.-Mr. Maybank.

Bill No. 80, for the relief of Joseph Gerard Fernand Arthur Groleau.-Mr. Croll.

Bill No. 81, for the relief of Audrey Nathaniel Smith MacNair.-Mr. Croll.

Bill No. 82, for the relief of Ovila Bernard. -Mr. Emmerson,

Bill No. 83, for the relief of Albert Edward Spray.-Mr. Emmerson.

Bill No. 84, for the relief of Helen Isabel Dibblee Brown.-Mr. Maybank.

Bill No. 85, for the relief of Robert Hiscock.

Mr. Homuth.

Bill No. 86, for the relief of Jacques Noel Cerminara.-Mr. MacLean.

Bill No. 87, for the relief of Joseph William Henry Beausoleil.-Mr. MacLean.

Bill No. 88, for the relief of Rita Beryl Gwendolyn Scott Lunn.-Mr. MacLean.

Bill No. 89, for the relief of Neil Sinclair McKechnie.-Mr. Maybank.

Bill No. 90, for the relief of Albert Evariste Gelinas.-Mr. Maybank.




The house resumed from Thursday, November 22, consideration in committee of bill No. 172, for granting to His Majesty aid for national defence and demobilization- Mr. Ilsley-Mr. Golding in the chair. Sections 1 to 6 inclusive agreed to. Bill reported. Mr. MACKENZIE moved the third reading of the bill.


Ernest George Hansell

Social Credit

Mr. E. G. HANSELL (Macleod):

Mr. Speaker, before the bill is given third reading I should like to say a few words. I am not going to make an extended speech because I know it is desired to have the bill read a third time to-night. We went through the sections rather hurriedly, and I rise now only to protest about the provisions of section 5, subsection 2, which deals with the powers to bury orders and directions. A careful reading of that section will show that very wide powers are being given to the minister. As was stated this afternoon on another measure, some of us are a little reluctant at placing so much power in the hands of the government. This section reads:

(2) AH orders and regulations of the governor in council made under the War Expenditure and Demobilization Appropriation Act, No. I, 1945, and this Act shall have the force of law and may be varied, extended, or revoked by any subsequent order or regulation, but if any order or regulation is varied, extended or revoked neither the previous operation thereof nor anything duly done thereunder shall be affected thereby, nor shall any right, privilege, obligation or liability acquired, accrued, accruing or incurred thereunder be affected by any such variation, extension or revocation.

I am quite certain I do not know what I have read, for legal language is always a tongue twister and a mind twister. However, it is obvious that under that section the minister has tremendous powers, and I wish to protest against such powers being given to the minister.


Motion agreed to, bill read the third time and passed.



Hon. C. D. HOWE (Minister of Munitions and Supply) moved the second reading of bill No. 173, respecting the Department of Reconstruction and Supply. Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Golding in the chair. Sections 1 to 5 inclusive agreed to. Reconstniction and Supply

On section 6-Ministerial powers and duties.


Grote Stirling

Progressive Conservative


Would the minister give us a statement with regard to this important section describing how he proposes to merge Munitions and Supply into Reconstruction in order to effect a smooth-working organization.


Clarence Decatur Howe (Minister of Reconstruction; Minister of Munitions and Supply)



This section embodies the general transfer to the minister of the powers and duties of the Minister of Munitions and. Supply and the Minister of Reconstruction and Supply. I have a chart of the new department which could be gone into in detail. The merger is not at all difficult, because many of the functions are common functions, for example, the legal department, the service department generally and the deputy minister's department. The production departments of Munitions and Supply have been liquidated pretty well and merged into the purchasing department. The purchasing department will become one branch in the new department. It will still purchase the requirements of the armed services and certain material for other governments, but it will purchase as a purchasing department rather than as a series of production departments.

The controller's branch is closely associated with Reconstruction although still in Munitions and Supply. It will still be necessary to keep a few controls, such as lumber, metals as they affect atomic energy, rubber for a time and construction for a time; all having to do, not with war at the present time but with reconstruction. The transfer of these branches into Reconstruction will be a natural step.

The liquidation of accounts and contracts, which is the big job in the Department of Munitions and Supply at the moment, will work in naturally with Reconstruction, as will the renegotiation section which is also very active in connection with the liquidation of obligations of the Department of Munitions and Supply. It seems to me that the change over obviously brings the branches from Munitions and Supply, which in effect is an obsolete title, into the field of reconstruction which is of paramount interest at the present time. It will allow the orderly liquidation of war activities and will, I hope, enable the new department to give some help to reconstructing Canada's peace-time activities and to reconstructing our civil economy.


Grote Stirling

Progressive Conservative


The minister has been referring, both last evening and this evening, to the renegotiation of contracts, and I wish he would elaborate on that a little. The contracts let by the Department of Munitions and Supply have to a large extent come to an


end, as he has said himself. In what sense are contracts being renegotiated at this stage? I can understand the liquidation of contracts owing to production cut-off, but what is the purpose of renegotiating those that are still on hand?


Clarence Decatur Howe (Minister of Reconstruction; Minister of Munitions and Supply)



The department had certain purchasing practices. If a new type of production were required, the practice in many cases was to fix a target price; that is, to allow the contractor to make a certain number of units and then make a firm price contract based on those units with a renegotiation clause. Usually those contracts called for a ceiling price of perhaps three, four or five per cent of cost. Then there were lump-sum contracts based on yearly production. Before these contracts can be settled it is necessary to audit the accounts over the years and to renegotiate the price according to what is indicated.


Grote Stirling

Progressive Conservative


They are continuing



November 23, 1945