Hon. W. T. WHITE (Minister of Finance) moved:
That it is expedient, in pursuance of the provisions of section 4 of the Act assented to on the twenty-second day of August, 1914, intituled : " An Act to conserve the Commercial and Financial Interests of Canada," to continue in force the proclamation in the form following published on the fifth day of September, 1914j in the Canada Gazette:
George the Fifth, by the Grace of God, of the United Kingdom of Great Britain and Ireland and of the British Dominions beyond the Seas, King, Defender of the Faith, Emperor of India.
To all to whom these presents shall come, or whom the same may in any wise concern, -Greeting:
E. L. Newcombe,
Deputy Minister of Justice, Canada.
Whereas in and by section 4 of an Act of the Parliament of Canada passed in the fifth year of Our Reign and intituled: " An Act to- conserve the Commercial and Financial Interests of Canada," it was provided amongst other things that in case of war, invasion, riot or insurrection, real or apprehended, and in cast ot any real or apprehended financial crisis, our Governor in Council might by proclamation published in the Canada Gazette:
(a) authorize the making of advances to the chartered banks and to the savings banks to which the Quebec Savings Banks Act, 1913, applies, by the issue of Dominion notes upon the pledge of securities, deposited with our said minister, of such kind and amount as may be approved by the Treasury Board; such advances to be repayable at such tmes as the Board may determine with interest at a rate likewise determined by the Board of not less than five per cent per annum;
(b) authorize the chartered banks to make payments in the bank notes issued *>y such banks instead of in gold or Dominion notes, but the total amount of uie notes of any chartered bank in circula-ion nootes, but the total amount of the amount of its notes issuable under the provisions of the Bank Act and of the next clause (c) ;
(c) authorize the several chartered banks to issue excess circulation, from and including the first day of March in any year, to and including the last day of August next ensuing, or during any part of such period, to amounts not exceeding fifteen per cent of the combined unimpaired capital and rest or reserve fund of the respective banks, as stated in their respective statutory monthly returns to our said minister for the month immediately preceding that in which the additional amount is issued;
(d) suspend the redemption in gold of Dominion notes,-
Now know ye that by and with the advice of our Privy Council for Canada we do by these presents proclaim and direct that by and on the date of the publication of this our proclamation in the Canada Gazette, the said orders in council shall be revoked ; and we do further by these presents declare and proclaim as follows, that:
(a) the making of advances to the chartered banks, and to the savings banks to which the Quebec Savings Banks Act, 1913, applies, by the issue of Dominion notes upon the pledge of securities ns provided in the said Act, be authorized;
(b) the chartered banks be authorized, subject to the provisions and limitations set forth in the said Act to make payments in the bank notes issued by such banks instead of in gold or Dominion notes;
(c) the several chartered banks be authorized to issue excess circulation as in the said Act defined from and including the first day of March, 1915, to and including the last day of August, 1915; and
(d) the redemption in gold of Dominion notes by the Receiver General of Canada be suspended subject to the provisions of the said Act from the date of the publication of this our proclamation in the Canada Gazette.
Of all which our loving subjects and all others whom these presents may concern, are hereby required to take notice and to govern themselves accordingly.
In testimony whereof, we have caused these Our Letters to be made Patent, and the Great Seal of Canada to be hereunto affixed. Witness, Our Most Dear and Entirely Beloved Uncle and Most Faithful Counsellor Field Marshal His Royal Highness Prince Arthur William Patrick Albert, Duke of Connaught and of Strath-earn, Earl of Sussex (in the Peerage of the United Kingdom), Prince of the United Kingdom of Great Britain and Ireland, Duke of Saxony, Prince of Saxe-Coburg and Gotha; Knight of Our Most Noble Order of the Garter; Knight of Our Most Ancient and Most Noble Order of the Thistle; Knight of Our Most Illustrious Order of Saint Patrick; one of Our Most Honourable Privy Council; Great Master of Our Most Honourable Order of the Bath; Knight Grand Commander of Our Most Exalted Order of the Star of India; Knight Grand Cross of Our Most Distinguished Order of Saint Michael and Saint George; Knight Grand Commander of Our Most Eminent Order of the Indian Empire; Knight Grand Cross of Our Royal Victorian Order; Our Personal Aide-de-Camp; Governor General and Commander-in-Chief of Our Dominion of Canada.
At Our Government House, in Our City of Ottawa, this third day of September, in the year of Our Lord one thousand nine hundred and fourteen, and in the fifth year of Our Reign.
Acting Under-Secretary of State.
He said: Mr. Speaker, under the Finance Act, 1914, which was passed at the August session, authority was given to the Governor in Council, in case of war or any financial crisis, by proclamation published in the Canada Gazette, to authorize the making of advances in Dominion notes to banks upon securities approved by the Treasury Board; to authorize the chartered banks to make payments in bank notes instead of in Dominion notes or gold; to authorize the chartered banks to issue excess circulation during, that period of the year in which previously to the passing of this legislation they had not had that power and to suspend the redemption in gold of Dominion notes. The object of the Act was to give additional volume and flexibility to the currency and to conserve the gold supply of the Dominion. I draw the attention of the House to subsection 5
of section 4 of this Act, which reads as follows :
No proclamation issued under the provisions of this section shall continue in force for more than thirty days after the beginning of the first session of Parlament held after the issue thereof, unless it is approved by resolution passed by both Houses of Parliament.
In September last the Government, in pursuance oiT the authority conferred upon it by the Act, issued a proclamation authorizing the doing-of the several things which I have just mentioned, and it becomes necessary now, if this proclamation is to continue in effect, as the Government thinks it should, that a resolution should be passed by the House of Commons and by the Senate continuing it in force. While no such financial conditions exist as prevailed at the time this legislation was passed in August last, it is deemed prudent by the Government and by the financial and business community that the proclamation should be continued. It is quite impossible to forecast what effect the vicissitudes of the war may have upon international finance or monetary conditions in the great credit centres of the world, such as London and New York. Parliament having met on February 4, it is desirable that this legislation should be passed without further delay, The Budget. debate is proceeding next week and, we should hope, without interruption. I would therefore ask the House to facilitate the adoption of this resolution. I have already brought down, in answer to a question, information as to the amount of advances which have been made to the chartered banks in Dominion notes under he authority of this legislation. To refresh the memory of the House, I may say that the total amount issued to January 31, 1915, was $14,400,000, and the total amount outstanding of indebtedness by the banks to the Dominion Government was $7,900,000, which indicates that there has been repaid to the Government $6,500,000.
I might say to the House that the amount of the advances made to the banks is by no means the measure of the advantage which has been conferred by this legislation. It has enabled the banks, among other things, to meet treasury bills of governments, municipalities and corporations maturing in London, it has enabled them to make advances to governments, municipalities, corporations and other customers, and it has assisted them, better than they otherwise would have been in a
*"Mr. W. T. White.]
position to do, to finance the crop movement of last fall. The banks were required to make payments on behalf of their clients of treasury bills maturing due, to make advances to provinces, municipalities and other customers, and they did so the more readily by reason of the fact that they knew-and in many cases they had arranged in advance for it-that if it should become necessary, they could obtain advances of Dominion notes from the Government upon the pledge of the- securities which they had taken, and which would be approved by the treasury board. The principle of the Bill was fully discussed and unanimously concurred in last August. I do not think, therefore, that it is necessary that I should discuss the substance of the legislation at this time. It may be a satisfaction to the House, which, as I have stated, unanimously approved the legislation, to know that it was instantaneously efficacious for the purpose of meeting the object we had in view when it was enacted, namely, to add to the volume of our currency and enable the financial institutions of the country, in the public interest, better to withstand the strain, stress and exigency of the trying conditions which prevailed as a result of the sudden outbreak of war. If at any subsequent stage of the session the House should desire to discuss more fully either the principle of the Act or our action under it, it is unnecessary for me to say that we shall be glad to afford an opportunity for such discussion, but in the meantime, unless this resolution is adopted, the proclamation will lapse, and I, therefore, hope that the House will facilitate its adoption.
Subtopic: PROCLAMATION CONTINUED.