Hon. A. K. MACLEAN (Acting Minister of Finance):
Yesterday the leader of the Opposition made inquiry concerning a return asked for on 20th March last in reference to the expenses in connection with the last Victory Loan. As he evidently desires that this information be submitted prior to the introduction of the War Appropriation Bill, I ask the leave of'the House to make a statement wdiich I hope will give him the information he desires. The reason the return has not been brought down was that full statements of all expenses in connection with the loan are not available to the department; consequently it is not possible to give to the House the exact information required by the Order referred to. However, I hope to be able to give the House substantially the information asked for, so that the progress of the War Appropriation Bill may not be delayed.
All expenditure in the way of remuneration for services in connection with the loan may be divided into three classes: first, remuneration to co-operating bond dealers and brokers; second, commission to canvassers; third, remuneration to banks.
As to the first, remuneration to co-operating bond dealers and brokers, in this loan the principle of co-operation rather
than competition among . brokers was adopted in order to organize and cover the whole country as effectively as possible. For this work practically the whole organization of all bond dealers and brokers was employed. The arrangement made by the Minister of Finance in reference to the remuneration of these firms was that at the close of the loan, after consultation with the Dominion Executive Committee and the consideration of any views or recommendations put forward by them, the amount to be paid would be based on t'he value of the services rendered in connection with the campaign by the several bond dealers and brokers. Some adjustments may yet have to be made, bat on April 5th the total payment under this head was approximately $750,000. Additional payments may yet have to be made to brokers. On the other hand, only last *week $30,000 was refunded by three of the principal bond houses of Toronto, and a few days ago $2,000 was refunded by the chairman of the chief committee in Saskatchewan. Possibly further refunds may be made of allowances paid to several of the committees throughout the Dominion.
As to commissions to canvassers, I may say that local canvassers were employed to solicit subscriptions and were given certain territory or lists of prospective subscribers to cover. Local canvassers were not permitted to solicit subscriptions .from those who. had been placed upon the special subscriptions list, which composed all prospective subscribers who, under previous loans, had subscribed for bonds to the amount of $25,000 or over. That is, any persons receiving subscriptions from those who had subscribed for sums of $25,000 or over in previous loans were to receive no commission thereon. Arrangements for the canvassing for subscriptions from these were made by the Special Subscriptions Committee, and no commissions were paid upon the same.
The Dominion Executive Committee was authorized to pay commissions to local canvassers on the following basis:
(a) In all places having a population of more than 10,000, local canvassers were to be paid a commission of i Of 1 per cent upon all subscriptions obtained by them.
(b) In places having a population of less than 10,000 and in rural sections, canvassers. were to be paid one-half of one per cent on all subscriptions obtained in their respective sections, whether secured by the canvassers or placed by subscribers directly with the banks, excluding, of
course, subscriptions from the Special List referred to above.
As of April 5, total disbursements for commissions to canvassers were $1,140,813.75.
As to remuneration to banks, a remuneration to chartered banks of one-quarter of one per cent on' the total allotment was paid for receiving subscriptions, payments, delivering interim certificates and definite bonds, and cashing coupons during the term of the loan-that is, during the 5, 10 or 20-year loan periods, as the case might be. The total amount paid to the banks for this purpose was $984,395.64. The allotment of the loan reaching $398,000,000 consisted of 5, 10 and 20-year bonds bearing 5i per cent interest. The issue was made at par with the privilege of deferred payments. It is estimated that the total expenses will reach approximately li per cent of the amount allotted. [DOT]
Putting the matter in concise form, the expenses of the loan up to date have been as follows:
Organization expenses $ 376,000
For Publicity Campaign,
(a) Through the Dominion Publicity Committee 163,000
(b) Through Canadian Press Association (disbursements to date) 207,000
For remuneration to Brokers and
Bond Dealers 750,000
Commissions to canvassers 1,140,000
Remuneration to Banks 984,395
In addition to this, there are, of course, the departmental expenses for printing the interim receipts, for engraving the bonds, for the staff employed, numbering some 700 persons, in the Department of Finance, who have been specially engaged upon this work since last December. It is estimated that the total cost of the loan, when finally available, will approximate $5,000,000, or about one and one-quarter per cent of the whole loan, which I think may be regarded by everybody as a very satisfactory rate.
The price of the securities issued was, of course, par, but by acceleration of payments, a slight discount, equal to the rate of interest which the bonds bear, namely, 5J per cent, was allowed to subscribers. Perhaps I may make that clearer to the House by saying that if a subscriber paid his subscription in full on January 2, last, he would pay for his bonds at the rate of 99 -107; if he paid in full on February 1, last, he would pay at the rate of 99 -467; if he paid on March 1, he would pay at the rate of 99-722; if he paid on April 1, he would pay at the rate of 99-909, and if he deferred his payment in full until the 1st
of May, as *he might do, he would pay at the rate of 100 per cent. I trust this will give to my right hon. friend (Sir Wilfrid Laurier) and to the House, the information desired. I shall pass over to my right hon. friend the statement from which I have read, and if there is any other information which he desires and which I can possibly give to him, I shall he glad to do so. But I trust that, with the information I have given, he will inform the Prime Minister that he may proceed with the War Appropriation Bill.
Subtopic: STATEMENT BY ACTING MINISTER OF FINANCE OF EXPENDITURE IN CONNECTION THEREWITH.