Mr. WOODSWORTH:

It may have been a wise thing. I can quite understand the position of the hon. member for Brome.

Ministers and Directorships

As, however, the discussion has gone on, reference has been made to the one member of the cabinet who is included in the list given by the hon. member for Brome. Some days ago I was furnished, not by the hon. member for Brome, but by a friend who had evidently been working on the same proposition, with a graph of this character, based, I believe, upon the Canadian Annual Financial Review of June, 1921. It seems to me that a graph of this kind ought to be placed definitely before the people of Canada, and they would then have no doubt as to the absolute necessity of this body making some provision for preventing power being placed in the hands of a few men such as we have here. As the hon. member for Brome was reading the list, I was checking this particular graph with his, and I think it is the same graph as it represents the same figures, the total capital controlled being something like $4,295,000,000. The names of the fifteen men who each have directorship in from two to eight of these big companies or corporations are as follows: 1, Sir Augustus Nanton; 2, Sir John Aird; 3, Sir Edmund Osier; 4, Lt.-Governor Cockshutt; 5, E. W. Beatty; 6, Sir Vincent Meredith; 7, Baron Shaughnessy; 8, Sir Lomer Gouin; 9, Sir Herbert Holt; 10, Sir Charles Gordon; 11, .C. R. Hosmer; 12, Hon. R. Dandurand; 13,

J. E. Aldred; 14, C. E. Neill; 15, E. L. Pease.

It seems to me there is no particular reason, if these men are occupying the most honoured positions in the country, why their names should not be generally known to the public, in order that their position in society should be recognized. I quite realize the fact that they have attained this position because of considerable business ability and all that kind of thing. It is not a matter of impugning their personal integrity in any sense whatever, but it is a question as to how the public itself can in some way control the great power which has gradually been concentrated in the hands of a comparatively small group of men. The resolution of the member for Brome would look to the separation of the Cabinet, on the one hand, from the power which is exercised by great corporations on the other. That may be a temporary measure; but it is in the right direction. The public generally is not going to be satisfied until, in some way, not only do we insist that Parliament shall not be directly controlled by these great corporations, but that, on the other hand, in some way, right within the corporations themselves, there shall be in-

troduced a very large measure of democracy. Political democracy was the watchword of the last generation, and we are all glad to think that we have attained a certain measure of political democracy. But political democracy is an absolutely hollow thing unless we have industrial democracy as well. This resolution which has been presented to day is simply the first step in controlling these great aggregations of capital which have placed almost unlimited power in the hands of small groups. For that reason I believe I am expressing the opinion of a large group of at least the labour and middle class people in this coun. try when I urge that the resolution be adopted.

Mr. McMASTER:

I assure you, Mr. Speaker, that I will not be long in my closing remarks, but there are just a few things which I think, in justice to myself, and I hope, in the interest of the country, I should say. I will deal with the remarks of the Prime Minister (Mr. Mackenzie King). In his eloquent observations he made the statement that I had wrongly interpreted the practice in Great Britain, and that in 1896 a committee of the House of Commons had sat for the purpose of considering the question whether it would be wise to more stringently draw the rules of the House of that great Parliament along the lines of, although not quite precisely in accordance with, my resolution of to-night. It is quite true that it was decided not to change the rules of that House, but that decision was arrived at by a vote of six to five. The five that voted for the purpose of amending the rules, more in the spirit of the resolution I have before the House to-night, were, Sir Henry Campbell-Bannerman, Mr. Courtney, Mr. Haldane, Mr. Lloyd George and Mr. MacNeill, while those who were opposed to any change were Mr. Bonsor, Sir W. Hart-Dyke, Mr. Halsey, Mr. Grant Lawson, the Solicitor General and Mr. Woodhouse. Now, I respectfully suggest that the five who voted in support of the principle I now advocate are well worth the six on the other side.

The Prime Minister stated that I had no ground for believing that anything untoward had happened in connection with his administration, and I would assure you, Mr. Speaker, I would assure him, I would assure this House, and I would assure this country, that I never suggested for one moment that there was anything untoward in any action of this Government. In bringing this matter before the House, what

Ministers and Directorships

have I done? I have simply done what I did last year with the enthusiastic co-operation of the Prime Minister himself. Not only in the debate which has been referred to, as to the advisability of directors in large companies being ministers of the Crown at the same time, but in another debate, was the attitude of the party plainly set forth. There was that debate provoked by me in connection with the railway estimates, in a speech which I made showing the inadvisability of members of the board of directors of the National Railways being also members of the board of directors of any company who might sell things to the railway. It was not precisely the same case, but it was precisely the same principle; for what is the principle? Without imputing wrongdoing to any one, I say that the principle is that a man should not be put in a position where either his personal interest or his fiduciary interest can conflict with any other fiduciary interest. That position was assumed by me on that occasion. I made a speech then late in the evening, and the Prime Minister did me the great compliment of placing largely the same facts before the House in his own budget speech. He did me the further compliment of placing those facts before the country from the Atlantic to the Pacific.

Mr. MACKENZIE KING:

The principles are not the same. The case of members of the board of directors of the railways purchasing for the railways from companies on the boards of which they are also directors, is not parallel to the principle now under consideration. If similar action were attempted by a minister of the Crown he would be disqualified in five minutes.

Mr. MEIGHEN:

Is the Bank of Montreal not dealing with the Government now every day? .

Mr. MACKENZIE KING:

Not at all in that direct way.

Mr. MEIGHEN:

Yes, and to the extent

of millions.

Mr. McMASTER:

If I might interject myself into the debate, if I remember the circumstances correctly, and I think I do, it was not charged by me or by the Prime Minister that directors of the national railways who were directors in other companies had been selling. The point I made was that they belonged to companies which might sell, and therefore it was improper

for them to be also directors in the national railways, who might buy from the companies in which they were concerned. There was a possibility of a conflicting fiduciary interest. Now, let us take the question of banks. I do so frankly, and I would point out to the House that I was careful in my introductory remarks to avoid any personality at all. It is a principle that I am advocating, and I try to keep away from personalities altogether. Let us put the case in a supposititious way. Suppose there were a minister of the Crown who was a director in a bank. Suppose that bank were doing work for the government. Do not even suppose that; suppose the bank were only doing what banks are obliged to do every month, sending in returns to the government. Suppose my right hon. friend were in power; what position would he take in regard to his Minister of Marine and Fisheries, say, when it was found that the bank of which he was a director had to be charged with having sent in false returns to the government. What position would my right hon. friend be in, and what position would his Minister of Marine and Fisheries be in if such a situation existed? I do not need to stress the point, Mr. Speaker. The thing is so patent that it is inadvisable to have ministers of the Crown directors also of banks.

Now, I spoke about interlocking directorates. The Prime Minister said: Well, interlocking directorates should be treated as such. I ask: By whom? By this Parliament, which may contain certain members in the Cabinet who are also members of these companies whose directorates interlock? It seems to me that whatever our opinion may be about the advisability or inadvisability of interlocking directorates, we should see to it that the interlocking does not pass into the Cabinet chamber. That is the position I am putting before the House to-night; I think it is reasonable.

It is true the Prime Minister seems to think that there is plenty of protection in the Senate and House of Commons Act, extracts from which he quoted. Now, if there was not an exception-which he did not read-permitting a company of which a member is a shareholder, dealing with the Government, what he said would, I think, be quite accurate and the necessity for this resolution would to a certain extent disappear. But it seems to me that whether a man is a director or merely a shareholder in the company, the fact that he is such does not prevent the company from dealing

Ministers and Directorships

with the Government. I think that is a correct interpretation of the law.

Shareholders need not give up their shares; that is quite true. I am sorry that I seem to find myself in the unfortunate position of not being able to please anyone. Last year my right hon. friend situated angularly opposite said that my resolution went too far, and now my critic seems to think that my motion does not go far enough.

Mr. MEIGHEN:

My hon. friend is looking in my direction. I did not say that. I took objection to it on principle as not meeting the case at all.

Mr. McMASTER:

I stand corrected

then. But last year I remember my right hon. friend saying: Why, you are trying to imp y that a minister should not even have the interest that his family gives him. And I recollect saying, with the former Minister of Trade and Commerce, Sir George Foster, in front of me, that it would be impossible to impose celibacy on his government. Shareholders need not give up their shares; that is quite true. I am not going on the assumption that there is something wrong. If there are dishonest men in public life, they will be dishonest no matter what legislation is passed; but what I do say is that we should try to prevent a possible conflict of fiduciary interest. The Prime Minister has said that leaders of political parties should not accept directorships. I agree with him. But I do not agree with him if he sets a higher standard for himself than for members of his government, because my view is that all the members of the Government, especially in view of our constitutional principle of solidarity, stand more or less on the same footing-that the Prime Minister is merely primus inter pares.

My hon. friend stated that my resolution would deprive him of the ability of leading business men. Now, that is exactly contrary to what I wish by my resolution. If first class business men go into the Cabinet, I wish them to be absolutely "off with the old love before they are on with the new" .-I wish them to be in a position to devote 'their whole time and attention to the affairs of the Government. I am of opinion that men of ability, no matter how rich they are, will be glad to do this if they have the proper spirit which we wish to see manifested in our public men.

The Prime Minister implied that in bringing forward this resolution I had

[Mr. McMaster 1

given way to a sentiment of juvenile audacity; that I should leave such questions for older and wiser heads.

Mr. MACKENZIE KING:

No, I was speaking entirely about myself.

Mr. McMASTER:

That just shows how one may misunderstand even one's friends. I must no longer detain the House. I have merely one argument to make, and that is in reply to stmething said by the right hon. leader of the official Opposition. He said: Under this resolution proposed by the member for Brome you might have in the Cabinet men representing the British Empire Steel Corporation and the Dominion Textile Company; that there is nothing to prevent great industrial corporations having their directors in the Cabinet; and the member for Brome says that that is all right. Of course, my right hon. friend sometimes exaggerates. I

never said that that is all right. I grant that that abuse is not specifically covered by this resolution. I grant the difficulty of keeping out certain companies and saying that the directors of those companies should not be in the Cabinet. What I have done is to pick out those classes of companies the directors of which have a particular fiduciary relation to their shareholders; thus the banks look after the money of the people, the trust companies look after the estates of the people. The companies I have picked out are large companies, companies which are very powerful and whose operations affect the whole people. It is possible that my resolution does not go far enough, but I say it is a step in the right direction and I trust it will meet with the approval of this House.

Hon. W. S. FIELDING (Minister of Finance) :

Before the House adjourns, may I be permitted to announce a very important financial transaction which has just been closed. The Government have sold $100,000,000 of Canadian bonds to Messrs.

J. P. Morgan and Company of New York. The bonds will be placed on the market tomorrow at par, bearing interest at five per cent, for a thirty-year period, callable after twenty years. The Government, of course have to pay commission to the banks, but the bonds will be offered to the public to-morrow in New York.

Mr. MEIGHEN:

May I ask the Prime Minister what will be the business tomorrow, aside from rejoicing over further debt?

Mr. MACKENZIE KING:

We will take up estimates of the Department of Railways as they affect civil government. Then we will go on with Militia and Defence, and, if we finish those, with Indian Affairs.

Mr. MEIGHEN:

In the Railway Department, only civil government?