June 4, 1931 (17th Parliament, 2nd Session)


Édouard Lacroix



It is useless for any one on this side to expect me to divulge the name of this person.
What are we to think, sir, of the tax of 15 per cent on the premium which will have to be paid in future by Canadians who are insured or intend to take out insurances in
The Budget-Mr. Lacroix

foreign companies? I state that this measure also gives protection where it is not needed, namely to Canadian insurance companies, especially those who form part of the association of underwriters.
By this legislation, competition between insurance companies is eliminated, to the detriment of the insured, and the public whose means are limited suffer thereby.
As stated, we have in this country an association of insurance companies known as underwriters. The companies which form part of this association protect one another and insure accordingly to the rates fixed by the association. In the past we had access to foreign companies, which competed against this association. However, in the future, I again state, in order to take advantage of this legitimate competition, the 'business man, t.he farmer or any resident of this country who does not wish to be under the absolute control of the underwriters, will have to pay 15 per cent on his premium.
To better describe what I mean and show7 how necessary it is sometimes to resort to foreign companies in order to obtain reasonable rates in a locality where, for one reason or another, the association of underwriters has fixed prohibitive rates, may I cite as an example a village which has had the misfortune of having had a serious fire. Owing to this fact the association's rates are often very much increased. In order to bring this association to better terms we had access, as stated, to foreign insurance companies. Heretofore to obtain reasonable rates and protect themselves against fire, all property owners will be forced to pay the government a tax of 15 per cent on the premium paid to foreign companies. I state that this is an unjust measure, one that aims at giving unbounded protection to the insurance association, whose companies are immensely wealthy, and this is detrimental to Canadian trade.
May I draw the attention of the right hon. Minister of Finance (Mr. Bennett) on the working of the Farm Loan Board. Loans have been requested for months past. Our farmers must absolutely renew their loans, either because the creditor having made poor investments elsewhere must withdraw his loans on mortgages made to farmers, or sometimes there are other reasons.
It would be an easy matter to allow the board to loan the amount needed by solvent farmers. But permission is withheld. I have reason to believe that the board is somewhat pinched as to the funds required. No one seems to bother much about those whose existence is most necessary to this country, the requested inspections are not carried out

or when they are, answers to requests are indefinitely postponed.
Our banks in rural districts do not extend to farmers long term loans. The latter seem to be totally ignored notwithstanding all the good reasons given to accommodate them for a limited time. The President of the Bankers Association, in April last, stated to the Canadian Press that he knew of no cases where banks refused reasonable loans. I may state that if he does not know of any such cases, I do, and these refusals happen daily in our rural districts. And how many other abuses are perpetrated by some of our banks!
Shall we allow this state of affairs to continue indefinitely in this country? The unfortunate situation in the past of one of our banks connected with the operations of Mackenzie and Mann or the Canadian Northern, will soon again happen if the committee on banking of this house does not investigate, without further delay, what is actually taking place in this country. The charter of our banks will come, in a few years before parliament in order to be renewed. Is the present time not a- favourable opportunity for members who form part of this committee to consider the ways and means of setting a few of these institutions in order? Would it not be possible for the committee on banking to suggest the passing of an act which would prohibit presidents and officials of our banks to form part of any other corporation but their own? Is it not a fact that precedents exist to that effect; the Bank of England and that of France do not allow any of their officials, president or governors, to form part of any other corporation but their own?
Would this not be the key to the situation, and would this not facilitate us in having banking institutions entirely free of all dangerous speculations.

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