March 6, 1950

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Murdo William Martin

Mr. Marlin:

Why not state the situation correctly?

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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles:

I am stating it correctly and I am going on to state a lot more; indeed I shall be quoting from the minister's own words several times before I have finished in support of my contention that since 1945 it has been the government's position to get rid of the means test.

At page 42 of the same book there are further references to this matter, one paragraph of which refers to the financing of the plans put forward in 1945. I quote:

The proposed system of old age pensions payable as of right without means test to persons seventy or over would be instituted and administered by the dominion government, and specific agreements with provincial governments would not be essential 'o its implementation.

There it was in categorical terms. There was an underlying condition, the tax agreements; but, given the tax agreements, no other specific agreement was necessary before the federal government would proceed to implement its proposal of universal old age pensions at age seventy without a means test, paid in full by the federal government.

The proposals go on to say:

It is within the power of the dominion to finance its share of the combined cost of health insurance and of old age pensions out of the consolidated revenue fund with such modification of taxation as would be justified, in the opinion of parliament, by the universal benefits of health insurance and old age pensions and by the other purposes of dominion expenditure.

There are, however, some definite advantages, in terms of administrative efficiency, compliance, and popular understanding of the plans, in introducing features more specifically contributory in nature and tied up more closely with the provisions of health insurance and old age pension legislation. These additional and desirable features would be helpful in the early and effective inauguration of the plans, and the dominion government asks that they be provided for in specific agreements with the provincial governments.

I know what the government is now doing. The government is now relying on that subsidiary reference to a contributory plan, which was to be considered only when health insurance was combined with old age pensions. Before I conclude, I shall have something to say about the loose way in which the word "contributory" is used. It is the sort of word that needs to be defined.

I read that last paragraph which I just quoted in order to give, as it were, both sides of the story-to give the wording that the government now uses in its claim that it always had a contributory plan in mind. But I point out that, in the paragraph I have just quoted, the contributory feature comes in only when there is talk about an over-all plan, including both old age pensions and

The Address-Mr. Knowles health insurance. With that I agree; but remember that the offer to go ahead and implement the proposal of universal old age pensions without a means test was categorical and definite. The paragraph I have just quoted said that specific agreements with provincial governments would not be essential to the implementation of universal old age pensions without a means test.

That proposal was put before the country at that time. It was given considerable publicity. I hold in my hand bulletin 9-A put out by the wartime information board on August 11, 1945, giving a summary of these proposals. It was on the basis of that summary that stories reached the newspapers and got to the Canadian people. Here is what it said:

The federal government would itself finance and administer a system of national old age pensions for persons over seventy years of age. Pensions would be at the flat rate of $30 per month, regardless of means. To be eligible, the individual must have resided in Canada for at least twenty years since age eighteen, including the three year period immediately preceding the date of application for pension.

This part of the program would cost the federal government approximately $200,000,000 by 1948, although there would be some recovery through income tax receipts from persons over seventy.

In case there is any doubt as to the interpretation being put on those proposals by the wartime information board or by the press of that day or by the general public, I call as another witness on my side of the case the present Minister of Justice (Mr. Garson). I hold in my hand a copy of the budget speech which he made in the Manitoba legislature on Thursday, March 27, 1947, when he was provincial treasurer as well as premier of Manitoba. The first subject that he dealt with as provincial treasurer was by way of a report to the Manitoba legislature on the dominion-provincial negotiations of 1946-47. The present Minister of Justice, then provincial treasurer of Manitoba, started off with a few words about financial matters and he then went on to say:

In addition the dominion offered under the heading of social security to pay the following grants:

1. To everyone of the age of seventy years and over, an old age pension at the rate of $30 per month without a means test, with the dominion assuming sole responsibility for the total payments and costs of administration.

The Minister of Justice is a smart man, and you do not fool him very often. He knew what those proposals meant, and he stated that quite clearly in his report to the legislature of Manitoba.

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Murdo William Martin

Mr. Marlin:

We have done better than that, and have increased the pensions since then.

The Address-Mr. Knowles

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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles:

The total amount of pension has been increased, with provincial participation, and in the case of some pensioners the federal government does now pay $30 as its share. But the Minister of National Health and Welfare (Mr. Martin) should know better than try to get me off the track. The eligible age should be lowered and the amount of the pension increased, but first of all I am contending that the most important hurdle to get over is the removal of the means test and the making of old age pensions universal for all Canadians. That is the main issue. It was the offer to do that and the denial by the Prime Minister that such an offer was made that prompts me to speak in the terms I am using now.

May I remind the house, particularly hon. members who were in the last parliament, that this whole question was discussed in the House of Commons a good many times during the twentieth parliament. We met for the first session of that parliament on September 6, 1945, and I find that on September 14 the then minister of national health and welfare, the present Minister of National Defence (Mr. Claxton), spoke in the debate on the address and dealt with the dominion-provincial proposals. I read this simply to show that the proposals as understood by the wartime information board, as understood by the press, as understood by the Canadian people, and as understood by the then premier of Manitoba, now the Minister of Justice, were confirmed by a member of this government on the floor of the house. I quote from page 182 of Hansard of September 14, 1945, where the then minister of national health and welfare is reported as saying:

Then there are the proposals with regard to old age pensions. First, it is proposed that there shall be a national old age pension of $30 a month, payable by the federal government to everyone over seventy years of age and, second, a contribution by the federal government on a fifty-fifty basis to the cost of old age pensions, payable on proof of need1 to people between sixty-five and sixty-nine years of age, to be administered by the provinces.

Then again on page 183:

These proposals now put forward by the dominion government are as generous as we can make them, while at the same time keeping the whole plan in balance, and workable. We have reached a balance in our estimates: the plan hangs together, and can be made to work.

Those are the words of the present Minister of National Defence: "the plan hangs together, and can be made to work." Against those words we must now place the words used by the Prime Minister on February 20 of this year when he said that there never was an offer of a pension without a means test and without contributions; that there could not be, because it just would not work.

iMr. Martin.]

You see we are getting not only backtracking on promises, but a denial that the government ever made certain specific promises which have built up the hopes of the people of this country that the means test would be abolished.

A little later, on September 18, 1945, I was speaking in the debate on the address. It will be of no surprise to hon. members to hear that I was speaking on old age pensions. I asked some rhetorical questions which prompted the then minister of national health and welfare to interrupt. I quote from page 272 of Hansard of that date, where I am reported as follows:

Incidentally, it is still only a proposal, and all the figures with reference to it in the proposals made at the dominion-provincial conference, and all the figures given by the minister in his address the other day, referred to the year 1948. I wonder why 1948; is that the year of the next election?

Some hon. Members; Oh, oh.

Not a bad guess; I was only a year out. The report continues:

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LIB

Brooke Claxton (Minister of National Defence)

Liberal

Mr. Claxton;

May I answer that now?

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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles:

I suggest that we should have something more than proposals for the distant future.

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LIB

Brooke Claxton (Minister of National Defence)

Liberal

Mr. Claxton:

May I answer the question now?

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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles:

I shall be glad if the minister will.

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LIB

Brooke Claxton (Minister of National Defence)

Liberal

Mr. Claxton:

Most of the figures for the proposal put before the conference were based on the year 1948. That was the first year following the war when we thought full conversion from war to peace would be in effect.

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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles;

Has the government or the minister or anyone speaking on behalf of the government given any indication that the proposal of $30 a month is to come into effect any sooner than 1948?

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LIB

Brooke Claxton (Minister of National Defence)

Liberal

Mr. Claxton:

It will come into effect as soon as the provinces agree to the proposals.

There you are; once again there is confirmation. They were only waiting for tax agreements between the dominion and the provinces; but given that condition, a clear-cut, well-defined proposal for a universal pension without a means test and payable to all was to come into effect.

We came back in 1946, and in the course of that session the subject came up once more. I should like to quote again from the present Minister of National Defence, who at that time still held the portfolio of health and welfare. At page 751 of Hansard for April 10, 1946, I find these words:

Before that, social security legislation was studied by other branches of the government and in consequence the proposals made by the federal government to the dominion-provincial conference were worked out.

Please note, in view of the study we are now asked to make, by means of a special committee, that there was a study of this question before the proposals were worked out in 1945. I go on with the quotation:

They are proposals which we believe can be carried out by the Canadian people and which will work to their advantage. We also believe that the burden can be carried by the Canadian economy.

The Address-Mr. Knowles

The Prime Minister says now there never was any such offer, and that there could not be, even though the Minister of National Defence said on April 10, 1946, as he had said in 1945, that the proposals they had worked out had been worked out on the basis of study, and would work.

Further down the same page, and continuing on the next page, the then minister said:

The plan proposed by the federal government to the provinces would provide for the payment of $30 a month without a means test to everyone at the age of seventy, and that it is estimated would cost $200 million in 1948.

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John Ritchie MacNicol

Mr. MacNicol:

To every person?

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LIB

Brooke Claxton (Minister of National Defence)

Liberal

Mr. Claxton:

Yes, over seventy.

I repeat, Mr. Speaker, that is the point in the whole issue that I am concerned about this afternoon-the universality of old age pensions, or getting rid of the means test. There is still the need for a higher pension and a lower eligible age, but first we must get rid of the means test. Hon. members are aware of the fact that we are receiving a great many representations these days on this subject. Admittedly that is one of the reasons why I am speaking about this matter, on behalf of the hundreds of people who are writing me, but I am also speaking about it because I firmly believe, from the study I have made of the question, that this is the most important hurdle to overcome. We can make other changes in old age pensions, but if we have not changed their application, if we have not made them apply to all our people, it will never be satisfactory. If we get a contributory system applying only to a limited section of the community, we shall have the same troubles they have been having with some of their plans in the United States. The first and the most important thing to do is to get rid of the means test and make the plan universal for all Canadians.

To carry on with my documentation of the government's position from 1945 until the Prime Minister uttered those strange words on the night of February 20, I ask you to turn to Hansard for June 18, 1947, at page 4283. We were then dealing with a bill to amend the Old Age Pensions Act in order to provide for certain increases that year. In this case the present Minister of National Health and Welfare is speaking, and at page 4283 he said:

As part of its program in the field of social security, the federal government proposed a system of national old age pensions. This provided for the federal government to assume the full responsibility for paying pensions at the rate of $30 a month to all persons in Canada seventy years and over.

I hope the minister will not get up and say that they are now paying $30, which is the federal government's share of the pension of

$40; because they are not paying it to all persons in Canada seventy and over, and that is the nub of the problem.

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Donald MacInnis

Mr. Maclnnis:

And not without a means test.

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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles:

If you take away the means test you pay it to everyone. The government has used both ways of defining the same thing.

I continue to read what the minister said at that time, on June 18, 1947:

The federal government proposed these pensions for all eligible persons without any income or means test whatsoever, and the federal government proposed to administer this scheme directly and bear one hundred per cent of the cost, amounting to an estimated $200 million annually.

That was not a request, Mr. Speaker, made from this side of the house. That was a forthright statement made voluntarily by the Minister of National Health and Welfare, in which he Confirmed the proposals made in 1945- ' confirmed them in the terms in which they were understood by the press and the people of that day, and in the terms in which they were understood by the Minister of Justice who was then premier of Manitoba.

Later on in the same speech I find these words:

This, in broad outline, represents the proposals made by the federal government to the provinces with respect to the aged and the blind. These are an integral part of the objectives in social security which this government has set for itself as soon as satisfactory over-all arrangements on social security, fiscal and other matters can be made with the provinces.

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LIB

Paul Joseph James Martin (Minister of National Health and Welfare)

Liberal

Mr. Martin:

That was right and still is.

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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles:

Just a minute; you were still talking in those days about dominion-provincial agreements as the one thing that was a condition precedent to the implementation of such a plan. The Prime Minister did not mention that the other night. His position now is that the offer of a universal pension paid to all without a means test and without contribution was never even made. He even went so far as to say such an offer could not have been made, it would not work, and anyway he did not believe in it.

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LIB

Paul Joseph James Martin (Minister of National Health and Welfare)

Liberal

Mr. Martin:

Why not quote the Prime Minister's statement correctly?

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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles:

I have done so several times already. Continuing with what happened on June 18, 1947, the then leader of the opposition was speaking, and the present Minister of National Health and Welfare interrupted him several times. The record is to be found at page 4291 of Hansard of that date. I need not quote it. The whole point was that the then leader of the opposition was saying that the government had changed its position, and

The Address-Mr. Knowles the minister of national welfare rose on a question of privilege and said that the position had not been changed, that the position as laid down in 1945 was still the position of the government.

I now turn to page 4643 of Hansard of June 25, 1947. The present Minister of National Health and Welfare was again speaking, and he said:

What my hon. friend can do is seriously to consider what I said about the government's over-all security proposals made to the provinces in August, 1945.

Listen to this:

If he does not accept my assurances I call to witness the words of the present Minister of Justice (Mr. Ilsley) when he was Minister of Finance last July, when he said that once we had a fiscal understanding with the provinces, the government's social security program represented an essential part of the government's objectives. I call to witness the statement of the present Minister of Finance (Mr. Abbott) twice this year, once in Toronto and once in this house. I call attention to my own statements as a responsible minister of the crown. But if that does not satisfy the hon. gentleman, let me remind him of the words of the Prime Minister in a telegram sent to the premier of Saskatchewan on July 15, 1946, and reiterated three times since in subsequent communications. This is what the Prime Minister of Canada said:

"As emphasized in the budget address, the public investment and social security proposals submitted last August remain an essential part of the dominion government's program. As soon as there is sufficient acceptance of the proposed tax agreements"-

That is the only condition-sufficient acceptance, not even total acceptance.

"-we shall be ready to explore, in a general conference, or otherwise, the possibilities of working out mutually satisfactory arrangements in regard to the whole or any part of our earlier public investment and social security proposals."

I turn now to page 4708 of Hansard of June 26, 1947, and I find that again the present Minister of National Health and Welfare is arguing with the then leader of the opposition; and the minister points out:

That portion of the old age pension scheme referring to the government's willingness to pay a pension to everyone seventy and over without a means test would cost the government over $200 million a year. These, as my hon. friend will appreciate, are not ordinary figures. The government's scheme was a plan in which every part had its place.

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John Ritchie MacNicol

Mr. MacNicol:

What does the minister mean by

"the government's scheme"?

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March 6, 1950