April 7, 1949

LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

It also acts as agent of the Minister of Trade and Commerce for making purchases on behalf of the Department of Trade and Commerce.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Muskoka-Ontario):

The

minister says quite truly that they act as the agent of the Department of National Defence for making purchases for that department. But there is no suggestion that this had anything to do with the Department of National Defence. The minister really must get down to the business of pointing out to us where there is some authority.

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LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

It had something to do with the Department of Trade and Commerce, had it not?

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Muskoka-Oniario):

You

cannot use the money of the Canadian Commercial Corporation except for certain specific purposes which are set out here. Did the minister or the department not consider its legal position with the Department of Justice?

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LIB
PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Muskoka-Ontario):

What advice did you get from the Department of Justice?

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LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

Is my hon. friend setting up the thesis that, if a sudden emergency occurs between sessions of parliament, nothing can be done?

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Muskoka-Ontario):

I am

not setting that up at all. But I am setting up that what has been done seems to have had

no legal justification whatever. I am not saying whether there was some way in which it could have been dealt with or not. I should think possibly there was. But I cannot see that this was the way. I think the minister should take the trouble, if the legal position was considered, to let us know what was said; because as it stands now it seems to me that this is just another of those things really worse than the ordinary order in council. The ordinary order in council does usually have something to back it up. But here the minister has as yet shown no authority of any kind, so far as I can see. Surely we cannot leave it at that.

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LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

The procedure was worked out by the officers of the Department of Trade and Commerce and the officers of the Department of Finance. The procedure was agreed between the two departments as the logical one in the circumstances. The approval of council was obtained. I think if my hon. friend will look at the files of this parliament he will find that the order in council has been on file for a considerable period. I shall be glad to get him another copy. I cannot think what more authority we can get.

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?

Some hon. Members:

Carried.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Muskoka-Ontario):

No,

Mr. Chairman, it is not carried. The minister has not yet answered my question. He just says that they were faced with a difficulty, that they decided they had better deal with it, and the departments got together. I thought he said a moment ago that they had sought the advice of the justice department, but apparently that was not done. I do not think this item should go through yet. I think there should be a further explanation. A further explanation must be given. If they did consult the justice department, we should know the advice that was given. If they did not consult the justice department, it is clear that they should have, and that they have just gone ahead regardless of any authority. I think this item should stand.

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LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

I may say here that there is an officer of the Department of Justice attached to the Department of Trade and Commerce and there is also an officer of the Department of Justice attached to the Department of Finance. We had the judgment of those two officers. I do not say we had written opinions. I do not see anything on which we should get an opinion. But in any case we had the advice of the Department of Justice.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Muskoka-Ontario):

The

minister says he does not see that there is anything he should get an opinion on. Nevertheless he is faced with the fact that there is not, as far as I can discover, and he has

Supply-Trade and Commerce not shown it to me, a shadow of justification for what has been done. If the law officers or the legal officers in the department were consulted, it is strange to me if there was no written memorandum of any kind. I suggest there may be something further, and I think this item should stand. I do not want to waste the time of the committee but it seems to me to be a very high-handed procedure. We have no desire to drag this committee's work out any more than anyone else but it is clear to me, as far as I can see, that it was a perfectly high-handed action and that we should not acquiesce in it. I think possibly the minister may be able to make out a better case than he has done up to the present time. But as far as I can see, he has made out no case.

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LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

I think this department is in the same position as any other. We are coming to parliament and asking it to approve or disapprove. If parliament disapproves, the government is defeated. If parliament approves, the item will be confirmed by parliament. But it will not be permitted to stand. It will be dealt with now.

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PC

William Alexander McMaster

Progressive Conservative

Mr. McMasier:

This is the result of a government guarantee. I have seen statements of this Canadian export company for some years. What surprises me is the low rate they have charged private exporters for their guarantee. As I recall it, the amount was infinitesimal- 002 or something like that. The result is that the Canadian export credit company have no surplus at all. Practically all the money they got in was from interest on bonds which they had purchased from the government. This is a large amount. I should like to know from the minister what rate they charged exporters to guarantee private people's exports.

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LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

I think my hon. friend is referring to the insurance corporation, is he not?

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PC
LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

That is not the matter that we are discussing. The corporation was formed under the act to which he refers, but there were two parts to the act. There was one part which authorizes transactions of the insurance corporation, and the second part which authorizes direct government to government loans-and I might say that some $600 million was loaned under that provision, government to government-and also includes provision for contracts between private firms with the guarantee of both governments. It was under that third provision that this action was taken.

Supply-Trade and Commerce

To reply to my friend the hon. member for Muskoka-Ontario, I might say that the assistant deputy minister of justice is a director of the Canadian Commercial Corporation, and it was his opinion that the action taken by the corporation was legal and proper for the corporation.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Muskoka-Ontario):

In

writing?

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LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

Well, I have that advice from my deputy minister. It must have been in writing, I should think.

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April 7, 1949