July 12, 1946

IND

Frédéric Dorion

Independent

Mr. FREDERIC DORION (Charlevoix-Saguenay):

I should like to ask the chairman of the flag committee when he will move in the house-

Topic:   NATIONAL FLAG
Subtopic:   INQUIRY AS TO MOTION FOR CONCURRENCE IN COMMITTEE REPORT
Permalink
?

Some hon. MEMBERS:

Order.

Topic:   NATIONAL FLAG
Subtopic:   INQUIRY AS TO MOTION FOR CONCURRENCE IN COMMITTEE REPORT
Permalink
IND

Frédéric Dorion

Independent

Mr. DORION:

I should like to ask when he will move concurrence in the report he tabled to-day.

Topic:   NATIONAL FLAG
Subtopic:   INQUIRY AS TO MOTION FOR CONCURRENCE IN COMMITTEE REPORT
Permalink
?

Some hon. MEMBERS:

Order.

Topic:   NATIONAL FLAG
Subtopic:   INQUIRY AS TO MOTION FOR CONCURRENCE IN COMMITTEE REPORT
Permalink
IND

Frédéric Dorion

Independent

Mr. DORION:

I think I am entitled to an answer. I am not asking the government; I am asking the chairman of the committee.

Topic:   NATIONAL FLAG
Subtopic:   INQUIRY AS TO MOTION FOR CONCURRENCE IN COMMITTEE REPORT
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LIB

James Horace King (Speaker of the Senate)

Liberal

Mr. SPEAKER:

Order. The report was tabled to-day, and as the hon. member knows, under standing order 45 some time must elapse before concurrence may be moved.

Topic:   NATIONAL FLAG
Subtopic:   INQUIRY AS TO MOTION FOR CONCURRENCE IN COMMITTEE REPORT
Permalink
IND

Pierre-Joseph-Arthur Cardin

Independent

Hon. P. J. A. CARDIN(Richelieui-Vercheres):

Arising out of the statement yioui have just made, Mr. Speaker, in reply to the question of the hon. member for Charlevoix-Saguenay' (Mr. Dorion.), may I ask the Prime Minister if it.is the intention of the government that such a motion shall be made later this day, and that Uie unanimous consent of those present in the house will be asked in order to do so?

Right Hon. AY. L. MACKENZIE KING (Prime Minister): Do I understand my hon. friend to ask if there is any intention of having the motion made later this day? There is no intention to have a motion later this day.

Topic:   NATIONAL FLAG
Subtopic:   INQUIRY AS TO MOTION FOR CONCURRENCE IN COMMITTEE REPORT
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THE BUDGET

DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE


The house resumed from Thursday, July 11, consideration of the motion of Right Hon. J. L. Ilsley (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Macdonnell, and the amendment to the amendment of Mr. Maclnnis.


IND

Wilfrid Gariépy

Independent

Mr. WILFRID GARIEPY (Three Rivers):

Last evening, Mr. Speaker, in my desire to conclude my remarks before adjournment I neglected to reply to a couple of interruptions as I might have done. I shall do so now. To the hon. member for Argenteuil (Mr. Heon) may I say that upon investigation I have

found that the school legislation adopted by the Anderson government in Saskatchewan has not been repealed or altered by the present Douglas C.C.F. government of that province. To the hon. member for Charlevoix-Saguenay (Mr. Dorion) I must say that on looking into the records I have found I am somewhat mistaken, in that he has seen the error of his ways oftener than 1 thought. I have discovered, and I must admit, that he has voted with the government oftener than I thought had been the case. For this good move I am satisfied his electors will be very grateful to him when the proper time comes.

Two hon. members from- my province yesterday raised the question of clemency in connection with our youngsters who may have violated the Militia Act. In this connection let me read an article which appeared in the Ottawa Journal of October 31 last:

In the united nation countries, it is recognized that the men who served on land, at sea, and in the air to defeat Germany, Italy and Japan have rendered a priceless service to humanity. But in Dublin, Mr. DeValera takes a different standpoint.

By an emergency decree signed by Mr. De-Valera himself, deserters from the Irish army who were absent from Ireland during the past five years for a period of more than six months will be barred from any government employment in Ireland for seven years and will be denied unemployment benefits . . .

Admitting that these men committed an infraction of Irish military law in going to war for freedom, it wmuld seem sensible and practicable to grant them amnesty-treat their war service as if they had been sent on special instructional courses-and use them to frame an army in Ireland which would really mean something.

Recently some military police have been in my own county putting their hands on a young man belonging to a well-known family. I am personally aware that the chief of police residing in my district has a list of a certain number of young fellows who are being looked for. I have visited the Longueuil camp not far from Montreal, where at the time I visited it there were over a thousand young men who were prisoners and treated as such. I am not going to plead, Mr. Speaker; I am not going to give any special reasons for what I ask. The war has been over for one year. I appeal to this house, to the country and to the veterans' associations of Canada to join hands, grant amnesty to our young men and let them' make a fresh start for the welfare of Canada as a whole.

As to the budget, I accept it as it is, complimenting the Minister of Finance (Mr. Ilsley) on the magnificent work he has done. We have undertakings, we have debts, we have responsibilities that must be met. Mr. Brunet, assistant

The Budget-Mr. Gariepy

general manager of Alfred Lambert, Incorporated, made a statement yesterday which seems to me to contain what I might have to say in connection with the budget. Mr. Brunet believes the present yield on capital after payment of taxes is not commensurate with the risk involved in industry; that income tax deductions from the salaries of employees affect their efficiency, because employees mistakenly hold employers responsible for the decrease in their salaries; and that delays in assessing income tax liability hamper industry. To remedy this situation Mr. Brunet suggests the abolition of the excess profits tax; determination of the date for giving back the refundable portion of taxes already collected, and a tax rate decrease of about 50 per cent on individual incomes of S3,000 and less, with a decrease of 25 per cent on larger incomes.

In connection with cooperatives, let me say that I have eight parishes in my own constituency. The cooperatives in those parishes are organized among farmers of good standing who, through their organizations, operate successfully. If the state interferes by putting a tax on them, their progress will be hampered. I have been requested to lay their request for exemption before the Minister of Finance. I am now waiting until the budget resolutions are debated to find out to what extent the views I have in mind are being met.

One other point to which I would refer in closing has to do with the harbour at Three Rivers. Last year the business at that harbour compared favourably with that done at other harbours in Canada. Statistics show that Montreal harbour handled 118.361,000 bushels of wheat, Halifax 14,762,000, Quebec 15,603,000 and Three Rivers 26,378,000. I have the figures for other harbours in Canada, but the ones I have given are sufficient to show that the business done at Three Rivers compares favourably with that done in other Canadian ports, and indicates that at Three Rivers we have a harbour of which we have reason to be proud.

Mr. Briggs, the manager of our local elevator, has said that our harbour is the basis of the future prosperity of our district. The visiting owner of an ocean liner used these words:

Your harbour is one of the best in the world.

I have travelled all over the seas. My boat has been everywhere, and I can give you a certificate that I was astonished to find in Three Rivers, between Montreal and Quebec, a harbour so modern and so easy of access, where a large boat like mine can land without any help.

The Gibb report, made at the request of the Bennett government in 1931-32, states this at page 31:

Considerable latitude should be allowed to the port managers so long as their activities are directed to carrying out the policy laid down by the central authority. It is essential to avoid emasculating the local administration, since no centralized control can replace an efficient and active local administration, or the special knowledge and initiative of the local business community, both of which are vital to a port's prosperity.

For this latter reason I strongly advocate a local advisory council. There are very many aspects of port working which such a council can properly care for, such as the representation of the interests of private wharf owners, of local merchants and distributors, of local consignees and exporters, of the labour view, and of the attitude of boards of trade, chambers of commerce, corn exchanges and other such trade organizations, in addition to shipping.

It serves very usefully to identify the community with the port; and to secure the support and interest of local members of parliament, the city council, or provincial government in schemes, and so anticipate and meet criticisms from any such quarters, or action that might be prejudicial to the port.

It is invaluable in exploring the possibilities of local markets, in carrying out advertisement and propaganda and in cooperation with interests likely to promote industrial developments. Finally, a local council provides a useful check on the tendency of more or less permanent officials to become stereotyped or arbitrary.

The port manager would be ex officio chairman of the council, which would meet regularly and be consulted on all such matters as proposed developments, alterations in rates, important changes in operation. The members of the council should have the right of initiating discussions on matters of policy affecting the port, on any complaints raised by users of the port, and on questions of rates, charges, etc.: but not on any purely executive matters, and they Avould have no executive duties or powers.

The advisory councirs proceedings and recommendations would be submitted to the central authority, and they should have the right of direct access to the central authority, but not to any other department of government.

The council should be sufficiently large to include all important interests and to ensure that its recommendations will be characterized by a broad outlook. Its composition should include the representation of the following interests:

Provincial government; municipalities; board of trade; railways; shipping; Department of Trade and Commerce; merchants, corn or other exchanges or organizations; dock labour.

I shall point out to the Minister of Transport (Mr. Chevrier) that this requirement has not been lived up to. In the old days we had a local organization composed of Three Rivers business men. These were leading men in the community who served without salaries and who gave their time and energy to furthering the interests of the harbour. That system was discontinued. We now operate under the administration of a central national harbours board. This national board, efficient as it may be, is composed of three men who reside in Ottawa and who have only a limited knowledge of conditions down my way. They

The Budget-Mr. Gariepy

act through an official who to some extent is protected because he has been appointed by the civil service commission and therefore cannot be removed from his office. He is a little czar in his realm. I am not suggesting that he is making too many mistakes, but I am saying that through him the requirements set out in the Gibb report should be resurrected and enforced.

I want the government to understand that with the advantages offered by the harbour of Three Rivers, with the possibilities of development found there, it should' be helped in the way I have mentioned, namely by the aid of a local advisory board who would follow up developments and give advice on whatever might be done for the advancement of the interests of that port.

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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PC

John Ritchie MacNicol

Progressive Conservative

Mr. MacNICOL:

The hon. member is right.

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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IND

Wilfrid Gariépy

Independent

Mr. GARIEPY:

May I lodge another small grievance? The family allowance provisions are effective in my part of the country, as in others. Moneys have been distributed, but in this matter of distribution I believe there is cause for some complaint. Possibly for reasons of economy, or because of the newness of the system, the department has only one general office for the whole province of Quebec, so far as the administration of family allowances in that province is concerned. This is neither practical nor effective. Three Rivers is situated centrally in the province. Families drawing these allowances are generally poor, and many are not educated. The idea is new, and frequently investigations are necessary. The people need help, and they write to Quebec, Montreal or Ottawa. Many cases have not received attention for weeks or even months, and I say this is an improper practice. It would not be more costly to have at Three Rivers a looal office from which the ten or twelve surrounding counties could be served. The same applies to the administration of the income tax. At present there is only one general office in Montreal, and one can well imagine the volume of correspondence flowing to that office.

It is true that some officials travel, but their visits are hasty and they do not long remain at one point. If, as we must, we are to continue collecting income tax, then it should become a part of the system to have local offices in different districts. I am not suggesting that there should be an office in ' every county or in every town. But for those in Three Rivers to have to seek information from Montreal or Quebec is placing the people of that city at a disadvantage, and is a condition which is not conducive to good results.

Anyone who travels through Quebec, as does the hon. member for Davenport (Mr. Mac-Nicol), will have noticed that the section between Montreal and Quebec is somewhat segregated. Running north from Three Rivers we find places like Shawinigan, Grand-Mere, and La Tuque, where one reaches the main line of the old Grand Trunk Pacific railway. Then, coming south one reaches points such as Nicolet, Victoriaville, Drummondville and Sherbrooke. From there one approaches the boundary line and the connections with areas south of the border.

At Three Rivers we are in the centre of the power area. Shawinigan Falls was the first power development project in Canada. Even to-day a million more horse-power could be developed if the factories were in existence to warrant it. This great power development is only about twenty miles north of my constituency. In the area are half a dozen paper companies. It is the world's centre for paper manufacturing, and we have the biggest mill in my own city, shipping its products day in and day out. It ships by water in the summer, and also by rail, one route going around by Montreal and the other by Quebec. The St. Lawrence river is very wide at that point and the ferries have been inadequate. There does not seem to be any practical way to get crossings that will give satisfaction. In that district there is eighty miles or so of first-class farming country, but it is not doing as well as it might if more attention were paid to it. I am not blaming anybody for that, but you know how it is. In the old days I lived where my hon. friend the member for Peace River (Mr. Low) resides, and I remember that Edmonton and Calgary were taking everything and the poor little town of Vegre-ville and the poor little town of Red Deer did not get much. Up to the present Montreal has been asking for a lot, and when it has not been Montreal it has been Quebec.

This country must go ahead and we must get busy to produce the best results. We have a large debt to pay. We want our people .to get returns for their work and for their abilities. The centre of our province can and should be opened up, and it would then provide ample revenues. We have a gold mine lying dormant there. What is required?

A request was made not long ago, but dropped, to build a bridge between Quebec and Levis. There has been agitation also for a bridge between Montreal and Longueuil on the south shore of the St. Lawrence. For two hundred miles there is no bridge across the St Lawrence between Montreal and Quebec, and in the summer you will see on both sides of the river hundreds of automobiles waiting

The Budget-Mr. Gariepy

for a chance to cross. Is that right? Is that proper? I say no. For various reasons a bridge must be built across the St. Lawrence between Three Rivers and thereabouts and the south shore.

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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PC

John Ritchie MacNicol

Progressive Conservative

Mr. MacNICOL:

That is right.

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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IND

Wilfrid Gariépy

Independent

Mr. GARIEPY:

That bridge will give connections and open up trade. It will give access and satisfaction to a great number of people. There are miles and miles of territory on the south shore which can be used by new industries. Industries can no longer go into the large centres because of the taxation and obligations of one kind and another, but in the territory I speak of there is room for industrial expansion, and at this time when money is plentiful and our business men are looking for new openings it is the duty of this government to invite the cooperation of the provincial government and of the municipalities and of the two railways, the Canadian Pacific and the Canadian National, both of which are interested in crossing the St. Lawrence near Three Rivers, so that all these bodies can get together to promote the building of such a bridge. It would provide work; it would give encouragement to the people, and it would meet a necessity. Now, when things are at a low ebb, and we are looking for something new and bigger, this is a project that should receive the attention of the government and of the best brains of the country to the end that a bridge may be built in the near future.

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Douglas Charles Abbott (Minister of National Defence; Minister of National Defence for Naval Services)

Liberal

Hon. DOUGLAS ABBOTT (Minister of National Defence):

Mr. Speaker, I think it is some two years since I took part in a budget debate, but I always enjoyed it. The nature of some of the opposition criticism during the present debate has made me feel that I want to get into the ring again.

The main line of criticism taken by hon. gentlemen opposite has been twofold: first, that the reduction in taxation provided for in this budget is inadequate and niggardly, to use the term used by some of the press supporting hon. gentlemen opposite; and in order to support their thesis, seeing that the budget shows a deficit of some $300,000,000, they contend that government expenditure is extravagant and reckless and must be reduced. If they did not contend that, of course, they would be advocating either more borrowing _ or inflation, and while some would like to borrow more, on the other hand they do not care to advocate that openly.

Before I deal, as I propose to do, with the main heads of expenditure, I want to point out to the house what it already knows, that the

fMr. Gariepy.]

estimates have been before the house for some two months now. The items of some of the more important departments, including agriculture and national health and welfare, and a substantial part of the estimates of the Department of Justice, have been considered in detail, and so far as I can recall the only suggestion made by hon. gentlemen opposite for a specific reduction in expenditure was in one of the items of the Department of National Health and Welfare, where they criticized a proposed expenditure of $300,000 to see that an expenditure of some $273,000,000 was properly made. On the other hand there have been numerous suggestions that expenditures should be increased. I asked someone in my office to prepare a list of the suggestions that have been made by hon. members opposite for increased expenditures. The job is a big one and it is not completed yet, but I can assure the house that it will be an impressive list when it is finished.

The total estimated expenditure this year is $2,769,350,000. Of that amount $1,515,846,000 is for demobilization and reconversion. ^ I am prepared to concede that there may be items in those estimates which can and should be reduced. In my own department, for instance, we have estimated that some $488,000,000 will be required for the three defence services this year, but because demobilization is proceeding more rapidly than we had anticipated and because of our continued efforts to effect economies I believe that this amount will be reduced. On the other hand I believe that the expenditures for veterans' benefits will be somewhat above those that have be

Of this total of roughly, $1,500,000,000, close to $700,000,000 will be for veterans' benefits in one form or another. Another $400,000,000 odd will be for the three defence services. The house will appreciate that the balance represents either necessary demobilization or reconversion expenditures, which, while I hope they may be reduced, cannot, I believe, be substantially reduced.

Coming to what might be described as the ordinary expenditures of government, they total $1,253,504,000. In that $1,253,504,000 there are a considerable number of items of expenditure which can be classified as absolutely uncontrollable and a number of others which are relatively uncontrollable. I am going to break that figure down.

Public debt charges amount to $481,207,000. Pensions, superannuation, et cetera, amount to $76,985,000. There is no possibility of reduction in either of those two items.

The Budget-Mr. Abbott

Subsidies and payments to the provinces under the taxation agreements amount to $99,062,000. There is no possibility of reduction there.

Unemployment insurance amounts to $20,432,000. I do not know whether hon. gentlemen opposite would suggest that that should be reduced, but I do not believe it could be reduced to any considerable extent.

For the Post Office Department the amount is 160,455,000. Admittedly that is only relatively uncontrollable, but it is a service department, and while it might be possible to effect some economies I do not believe the expenditure can be substantially reduced.

The Department of National Revenue shows another large expenditure, $26,062,000. I would point out to the house that while that is substantially higher than the year before the war, that department is charged with the collection of revenues amounting to some $2,600 million. That is not out of line-with the work involved.

There are other expenditures totalling $6,097,000 which include amounts payable under the Prairie Farm Assistance Act. Hon. gentlemen opposite do not suggest that these expenditures, which amount to $3,000,000, should be discontinued. There is some $2,000,000 included in this total for cheese and cheese factories, and I understand that these payments have been effective for some time. Certainly no suggestion has been made that these should be reduced. There are sundry others.

We have family allowances, $250 million. I have heard no hon. gentleman opposite suggest that these payments should be discontinued or reduced. Finally there are payments under veterans affairs which amount to $58,320,000 exclusive of pensions. These include such matters as hospitalization grants, pensions under the Veterans Allowances Act, soldier settlement board expenses, Veterans Land Act, and the like. From my limited experience in the veterans affairs committee I have not been led to believe that there is any persistent or extensive demand among hon. members of the official opposition, or for that matter elsewhere in the house, that expenditures of this kind should be reduced.

Those total $1,078,620,000 in round figures. If you take that figure and deduct it from the figure of $1,250 million which I mentioned at the outset, you are left with the more or less controllable expenditures of government amounting to $174,884,000. That is an increase of some $62,700,000 from the corresponding comparable figure for the last pre-war year of 1938-39, which was $112,200,000. At first 63260-215t

sight that figure may seem somewhat large, but there is a good explanation for all these increases. I am not suggesting that no effort should be made to effect further economy, but I do not believe it will be possible to effect substantial economies and maintain efficiently the services of the country.

I come now to the main items which make up this increase of $62 million odd. The first and largest is the cost of living bonus to government employees, which totals in the neighbourhood of $20 million. Perhaps I should not prophesy, but I think it is fair to say that that will become a permanent part of the government wage structure. There is assistance to agriculture which cost $4,200,000. The increase in external affairs is over $3 million, but that is consistent with our greater starure as a nation, the additional legations we have opened, and the added representation we have abroad. Department of Finance is up $5,300,000, largely because of increases in the cost of operating the office of the comptroller of the treasury, due to the vastly greater expenditures which it is necessary he should supervise.

Mines and Resources and Public Works are both up substantially, but those are departments which cut their maintenance operations to the bone during the war. The increase of $5 million in the case of Mines and Resources, and some $20 million in the case of Public Works, represents largely deferred maintenance. Expenditures of the Department of Transport are some $5 million higher, due largely to deferred maintenance and the construction of terminal facilities for the Prince Edward Island car ferry. Finally, the expenditures of the Department, of Trade and Commerce are $3,900,000 higher, owing largely to increases in the operation of trade services.

Taking $200 million as a fair estimate of the really controllable portion of our expenditures, if we were to cut those twenty per cent it would amount to $40 million. I do not believe it would be possible to cut them twenty per cent and maintain efficiently the services of this country. But if it were, it still would not be possible to balance the budget. Moreover, I suggest to members of the house that in total expenditures of some $200 million to cover the ordinary services of the government there is little justification for the charges of reckless and profligate expenditures, which were the adjectives used by the hon. member for Lake Centre (Mr. Diefenbaker).

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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PC

John George Diefenbaker

Progressive Conservative

Mr. DIEFENBAKER:

They have not been changed after hearing the statement of my hon. friend.

The Budget-Mr. Abbott

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Douglas Charles Abbott (Minister of National Defence; Minister of National Defence for Naval Services)

Liberal

Mr. ABBOTT:

The facts speak for themselves. The hon. member for Muskoka-Ontario (Mr. Macdonnell), who is the financial critic for the opposition, reproached the Minister of Finance (Mr. Ilsley) when he rose to speak after the minister had completed his budget address for not using the word "economy" in the course of his speech. I hold in my hand an extract from the Montreal Gazette of May 16, 1945. It is entitled, "Bracken's Charter for a Better Canada." It reads:

The following is the text of a declaration of policy for the Progressive Conservative party, by John Bracken, as given in a speech delivered in Ottawa, last evening, in the Glebe collegiate auditorium.

I have been through this statement carefully, and if I may paraphrase the remarks of the hon. member for Muskoka-Ontario, I have been unable to find any use of the word "economy" in that impressive document. But I do find a great many references to proposals which would involve substantial expenditures of public money. If I may, I should like to state a few of those to the house.

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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PC

Howard Charles Green

Progressive Conservative

Mr. GREEN:

What date is that?

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Douglas Charles Abbott (Minister of National Defence; Minister of National Defence for Naval Services)

Liberal

Mr. ABBOTT:

This is dated May 16, and it is apparently the text of an address delivered the night before by the leader of the opposition (Mr. Bracken) in the Glebe collegiate auditorium in Ottawa.

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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July 12, 1946