Mr. CHAPLIN (Lincoln):

I do not mind being asked a question, but I object to the hon. gentleman making a speech.

Mr. STEWART (Edmonton):

With 'all

due respect to the hon. gentleman, he asked the question and I answered it.

Mr. SPEAKER:

The hon. member asked a question, but I think he is now asking for protection for himself.

Mr. CHAPLIN (Lincoln):

I do not mind being asked the question, but I do not want the hon. gentleman to answer it too.

I am sorry the Minister of Finance is not in the chamber because I want to refer to one more item on the schedule. Hon. members will remember that some years ago I stated in this House that I approached the late Minister of Finance, the Right Hon. Mr. Fielding, with the request that' he place a duty on the dyeing of silk. There was no duty in 1921 upon the article that it was proposed to put on the market and the manufacturer who was desirous of coming here to do the dyeing asked for 10 per cent protection. The minister said: Of course we are not a protectionist government and I will not make

any promises, but if it looks reasonable to us I will consider the matter. In the 1922 budget the minister was good enough to place a duty of 10 per cent upon the silk dyeing industry and in my locality about $100,000 were spent by a small firm in establishing a silk dyeing industry. It so happened that the minister, along with the then Minister of Marine and Fisheries, who afterwards became Minister of Justice (Mr. Lapointe), went over to France and made a treaty with that country. By means of that treaty about one-half of the duty was cut off.

I want to refer to another act of perfidy, or, Mr. Speaker, if you consider that too strong a word, let me say another breach of faith on the part of this government. A couple of years ago, I believe in 1924, an English concern came to Canada and approached this government with a view to having a duty imposed on artificial silk, which product they were prepared to make. This company, I may say, is the largest English concern in the silk industry and one of the foremost companies of the kind in the world. They came here and interviewed the minister, submitting certain proposals as to what they would do. They offered to erect a plant at a cost of between $2,000,000 and $3,000,000 and to utilize our wood product in the making of artificial silk. We do not know what took place but at any rate the government met them, and following that interview a duty was imposed on this article At the same time a drawback was provided for the purpose of allowing people interested in the importation of this commodity to bring in their supplies in the meantime until the factory should be started. Mr. Fielding in 1923 at page 2648 of Hansard volume 3 is reported as follows:

A ncsw industry is promised us for tihe manufacture o-f artificial silk. It is represented to us that this industry will employ a large amount of labour and we have every reason to believe that if we can make encouraging terms a great industry will be established. We propose to make a classification in which it will be treated largely as silk, and we have every reason to hope this will lead to a very' important industry being established.

The Englishmen, it appears, were not quite satisfied with the lengths to which the minister had gone, and after some further negotiations the resolutions were changed in committee to meet their views, with the result that they got the terms they desired. The drawbacks were also arranged. The company afterwards wrote to the minister and told him that they were going to be somewhat late in getting their mill going. They wanted to make sure first that their product was a success, and so

3310 COMMONS

The Budget-Mr. Chaplin (Lincoln)

they asked the minister to continue the drawback arrangement until such time as their plant might be put into operation. The minister did so. There was passed an order in council, which I have under my hand, extending the time to December 31, 1925. A few weeks ago the government were informed that these people were now ready to produce in Canada. They had experimented long enough with the Canadian raw material to ascertain that the article they could produce here was first class. As a matter of fact it was better than they had anticipated, for they found that our wood excelled their expectations. Now, very much to their surprise, the minister brings down a budget containing an entirely new arrangement in favour of another firm who are about to begin operations in the province of Quebec. The effect of this departure of the government's is that the duty which this English firm has had on its product for three months and fifteen days is now practically removed. Three-quarters of the duty has been taken away, and these people would be stranded if it were not for their strong financial position. That is what I term an act of perfidy. It is a breach of faith on the part of this government which will do us no good in any market of the world when what has taken place becomes known. I have no brief for these people, nor have I any information other than I have been able to pick up. I may observe, however, that they came to my city because it was the centre of a small growing industry, engaged in the manufacture of silk. This is the treatment that they have received at the hands of this government. They have invested in the town of Cornwall over $2,000,000 and they employ about 500 people to-day. It is going to be two years before the firm in Quebec are ready to produce and in the meantime the product of the other people is allowed to come in practically free. In other words, 75 per cent of their finished article will come into the country under a drawback. That is the kind of treatment which this government metes out to people who come here to do business.

I think I have taken up enough of the time of the House, Mr. Speaker, and I beg to thank hon. members for the careful attention with which they have followed my observations.

Mr. A. J. MACDONALD (Glengarry):

My purpose in participating in the present debate, Mr. Speaker, is to direct your attention to the fact that notwithstanding the wonderful progress of the province of tMr. J. D. Chaplin.]

Ontario along industrial lines its outstanding and predominant industry is still agriculture. Fortunately all parties concede that agriculture is our basic industry and that when this industry prospers all others prosper. In view of this fundamental fact it is reasonable to expect that the elected representatives from the province would be very much concerned with the present position of this industry, and that its requirements would evoke the sympathetic interest of hon. gentlemen opposite. I submit that it is fair to say that during the progress of this debate whatever sympathies hon. gentlemen opposite have shown have been on the whole with the protected interests.

Having been closely associated with the farming industry of my native county of Glengarry for the last thirty-five years, and having an intimate knowledge of the constant struggle on the part of the vast majority of them to make ends meet, even in that fertile county, I have endeavoured to evolve a reasonable explanation for this condition of mind on the part of hon. gentlemen opposite. Perhaps a casual analysis of the report of the Chief Electoral Officer in respect of the last general election will provide it. Looking at this report one finds that, sixty-eight Conservatives were elected out of a total of eighty-two candidates. They were elected by 57 per cent of the votes polled, and 38 per cent of the total possible vote, and of these sixty-eight members, four are classified as farmers, one as a retired farmer, three as farmers and breeders of pure bred stock and one as contractor and farmer.

With all due deference to the superior training and the intellectual attainments of the many gentlemen of the learned profession in that group I submit, Mr. Speaker, that this very training precludes them from a sympathetic understanding of the problems confronting the farmers of this country and that those among them who should be sympathetic have permitted their sympathies to be dulled by their environment. How many of the elected representatives from Ontario have a clear understanding of the income and expenditure of the average farmer? Yes, how many gentlemen connected with tin press of this Canada of ours have an adequate conception of the income and expenditure of our average Canadian farmer? In the final analysis the press may be held accountable for the wealth of misunderstanding prevailing in the industrial and urban centres of our fair country in this respect. In this connection I wish to direct your attention to an article in Toronto Saturday Night which was

The Budget-Mr. Macdonald (Glengarry)

reprinted by the Ottawa Journal of the fifth instant and which reads:

Taxes, Tariffs, Industry

When the Canadian Council of Agriculture met the cabinet the other day the members expressed themselves strongly against the reduction in the income tax. These philanthropists believe in taxation. Of course they do-for everybody but themselves. Their worry is not that they pay income taxes, but the reduction in the income tax may by hook or crook make it necessary to levy other taxes and these may get to them in time.

As for the application of the income tax, be it high or low, they have no reason to worry. Last year according to recent figures there were exactly 3,061 farmers in Canada paying income taxes, and the sum total they paid was $162,000. This chicken feed was contributed by 530 Ontario agriculturists, to the amount of $19,351. In Quebec 42 paid $3,775, which was just about half the sum that British Columbia farmers paid. In the Canadian west farmers appear to have a reasonable view in respect to their responsibilities. In Saskatchewan 1,492 farmers paid $70,956.

In Alberta 663 farmers paid $49,894, though Manitoba fell down with only 171 farmers paying $6,303, but this was nearly twice what Quebec paid.

As fifty per cent of the people in Canada either live on farms or draw incomes from them the question of income taxes so far as they are concerned is rather a joke, particularly in view of the fact that upward of half of the country's wealth is derived from the farm.

Of course if the 168,000 employees who in 1925 produced $13,973,000 as their contribution toward the income tax collected, could live off their salaries in the same manner as the farmer lives off his acres, with no one to check them up, our interest in the income tax would not be of a character to keep us awake nights.

And this brings up another question. If the government proceeds to rip the vitals out of industry who is to pay the taxes? Where is the government to find that six or seven hundred million dollars necessary to meet the yearly liabilities? Land taxes look to b'e in sight.

In 1924 Ontario and Quebec paid $44,000,000 out of the total of $56,000,000 paid in income and war taxes, while out of $4,700,000 paid as business profits tax Ontario and Quebec contributed $3,500 000. If industry is to be sacrificed to make a holiday for the Progressive party and such part of the Liberal party as believe in such things, the time will come when a complete revision of taxation methods will be necessary to meet new conditions.

The tenor of this article suggests that inasmuch as upwards of fifty per cent of the country's wealth is derived from the farm, and fifty per cent of the people in Canada either live on the farm or draw income therefrom, the farmers are dodging the payment of income tax because there is no one to check them up. May I suggest that rather than this smug assumption on the part of the would-be saviours of this country that the men and women engaged in our basic industry are dishonest, the fact that only 3,061 farmers paid the small sum of $162,000 in income tax out of a total of $56,000,000 in the year 1924 should be a compelling reason why every man interested in the economic situation and future welfare of our country should pause and ask himself where we are drifting.

For the information of the House and those people in this country not familiar with this problem I invite you to consider seriously with me, as the importance of the subject fully warrants, the financial statement of one of our young farmers engaged in dairying and mixed farming, covering his business operations for the years 1922, 1923, 1924 and 1925. It is my firm conviction that even a superficial examination of these statements will lead to a better appreciation and understanding of many of the problems confronting us at present, and understanding it may force us, even against views honestly held, to consider our whole fiscal policy before it is too late.

This young man owns a 109-acre farm with 50 acres under cultivation, 20 acres of pasture and 30 acres of bush. The value of the farm and stock is $9,000, against which he has a mortgage for $5,000, which is not an unusual condition among the farmers of Ontario. The following are the! financial statements foi 1922, 1923 and 1924:

Revenue-

42,160 pounds of milk from 8 cows at

$1.24 per cwt

Cows and cattle sold and used

Hcgs sold and used [DOT]

Insurance on horse killed by lightning

Eggs and poultry sold and used

Hay sold

Wood sold and used

Maple syrup sold and used

Potatoes and roots used

Expenses-

General repairs $129 00Taxes

94 35Fire insurance

6 50Feed bought for hogs

161 45Hired help

60 00Threshing and Dressing

55 00Blacksmith bills etc

30 00

Horse bought to replace that killed 110 00

Balance $1,073 88

Annual payment on mortgage of $5,000, amortized over 20 years at 6 per cent. 435 90

Balance available for clothing, groceries, medical aid and all other necessities... 1923

Revenue-

44,830 pounds of milk at $1.54.

Cattle sold

Hogs sold and used

Eggs and poultry sold and used.

Hay sold

Maple syrup sold

Wood sold and used

Potatoes and roots used

3312 COMMONS

The Budget-Mr. Macdonald (Glengarry)

Expenses-

Repairs $100 00Taxes

87 72Insurance

0 50Feed bought for hogs and depreciation in value

353 09Hired help

08 75Threshing and pressing

39 25Blacksmith bills etc

35 00

690 31

Annual payment on $5,000 mortgage.. .. 435 90

Expenses-

Repairs

Feed for hogs and hens.. ..

Hired help

Threshing

Blacksmith bills etc

718 66

. $1,136 99

Annual instalment 435 90

mean, I propose to consider in detail the omissions as affecting particularly the mining industry.

Now, with particular application to the mining industry in our own country, wherein does the budget fail? First and foremost, no consideration is given to labour, the most essential element in the success of mining or any other industry. I refer especially to the homes and living conditions of the miners and those who live in mining towns.

A discovery being made, development and construction proceeds apace, a town or city springs into existence, and the inhabitants are forced to install water works and sewage systems, build roads, schools, churches, and public buildings. In one stroke they must accomplish what entails years of slow and patient growth in a fanning or any other industrial community. This being done, and the mine put on a producing basis, the federal and provincial authorities step in and reap the benefit without a word of thanks or a gesture of gratitude.

Take for example, the case of a city in the province of Ontario, a city owing its birth and existence to the discovery and operation of a mine, the city of Timmins with a population of some seventeen thousand people. Under the Mining Tax Act of Ontario, that city is not allowed to levy any tax on the profits of the mine within its precincts, nor upon the mill or other mine buildings. The Ontario Mining Tax is not really a profits tax but is an arbitrary method of giving the provincial government a revenue from profitable operations in lieu of a royalty, while assuring would be investors that stability indispensable to a successful commercial enterprise. The act is based on the report of the Royal Ontario Nickel Commission of 1917, which report takes into consideration the taxing systems of every mining country in the world. Let me quote clause 5 which contains the gist of the act:

5. (1) Every mine in Ontario, the annual profits of which exceed $10,000, shall be liable for and the owner, manager, holder, tenant, lessee, occupier, and operator of the same shall pay an annual tax as follows:

(a) Three per centum on the excess of annual profits of such mine above $10,000 and up to $1,000,000.

0>) Five per centum on the excess above *1,000,000 and up to $5,000,000; six per centum on the excess above $5,000,000 and up to $10,000,000; seven per centum on the excess above $10,000,000 and up to $15,000,000, and on the annual profits above $15,000,000 a percentage or percentages increasing in like progression.

Of this amount, the provincial government allows fifty per cent up to a maximum of

835.000 to go to the local municipality. Over and above this, the federal government lifts

about twice the total and contributes nothing to the municipality.

Allow me to refer to the profit and loss statement for the Hollinger Mine for the year 1925: '

Taxes, province of Ontario $152,296 62

Municipal taxes (except residences owned

in city) 35,000 00

Dominion of Canada 1925 taxes 388,000 00

Dominion of Canada 1924 taxes (adjustment) ' 57,597 34

Not only does the federal government corral more than double the amount levied by the province but the levy is made without allowing the mine to deduct from profits the amount paid either the province or the municipality.

A further incongruity lies in the fact that with regard to the federal income taxes, no allowance is permitted for money spent by mining companies on outside ventures. As everyone knows the development of new mines is extremely hazardous in a financial sense, the proportion of payable mines to the total number of properties on which work is done, being very small. If mining organizations are going to survive they must get new mines, but as the law stands for every dollar spent by a mining company in outside prospecting, exploration, development, and equipment, a tax is paid, and even under the new tax regulations the cost to the companies is $1.04i. It seems only reasonable to ask that in view of the large, very large element of risk in the development of new properties, mining companies should be allowed to spend annually a certain percentage of their capital in outside ventures and that this money if so spent, should be exempt.

With regard to the reduction in the rate from ten and one half per cent to nine per cent, I consider it is merely a matter of shifting the burden with a net loss to the actual shareholder. As pointed out by the hon. member for Quebec West (Mr. Parent):

If you happen to be part owner of a mine, the company first pays the income tax, and as shareholder or part owner you must also pay, so that whereas you are given consideration for depreciation only once you must pay the tax twice.

On hearing that statement I was inclined to agree with the hon. member, but on further investigation I find it is not true. There is a fifty per cent allowance on net profits for depletion of the mine, also an allowance of fifty per cent on mine dividends in the case of gold and silver and twenty-five per cent in the case of copper. No allowance is made in the case of nickel. This is an incongruity which should be rectified.

The Budget-Mr. O'Neill

Reverting to the case of the municipality, I consider it is only fair, equitable, and just that the Dominion, spending a very small item on geology or any activity contributing to the success of provincial mining ventures- I mean comparatively speaking-should

acknowledge indebtedness to the working man and help reduce his tax burden. He pays income and property tax to the municipality as well as income to the Dominion as well. To my mind, it is nothing short of robbery on the part of the federal authorities. The case is totally different from every other community. The city in question, and every mining city as a matter of fact, is situated away off on the frontier; the inhabitants are all workmen raising families, and the school question is more acute than that of housing. Why, in Timmins last year more than the provincial allowance of $35,000 was given out in charity to the workless! Yet the federal money grabber can walk off with approximately one-half million dollars without the slightest qualms of conscience. The same applies in the good old township of Tisdale, in Teck, and down through the silver region.

Recognizing the fact, Sir, that Canada's mineral industry has reached such tremendous proportions, I believe, and I am sure all hon. gentlemen in this House will agree with me, that the time is ripe for the immediate calling of a conference of representatives from the Dominion, the provinces, and the various mining associations for the purpose of framing uniform and non-duplicating tax laws and uniform mining laws in general throughout the Dominion of Canada. I have heard mining men of experience and prominence say that the federal mining laws are beyond all doubt the worst in the world, both as to acquiring and as to holding mining property. There are some irritating differences between the laws of Ontario and those in vogue in Quebec, and these could easily be ironed out before the industry becomes further established. I might add that I have heard mining men from Africa, Australia, and the United States state that Ontario mining laws worked out to greater advantage than any with which they had experience.

It might not be inadvisable here to refer to the present status of Canada's mining industry. The situation is well outlined in a report by S. J. Cooke, chief of the Mining, Metallurgical & Chemical branch of the Dominion Bureau of Statistics at Ottawa in the course of an address at the opening session of the annual meeting of the Canadian Institute of Mining and Metallurgy in Montreal, March

3rd, 1926. Reviewing the developments of the year, Mr. Cook pointed out that the production of minerals reached a value of $224,846,237, an advance of $15,262,831 over the total for 1924, and well towards the record valuation of $227,859,665 attained in 1920, when new production records were established. Among the metals the remarkable advances in the production of gold, lead and zinc were the most outstanding. Improvements in outputs marked the totals for nickel, copper, cobalt and silver. Sales of asbestos increased during the year by more than $2,000,000 to a total value of $8,995,854. Improvement in the production of other non-metallic minerals was noted in the figures for fluorspar, graphite, gypsum, natural gas, petroleum, quartz natural sodium sulphate and carbonate, salt, talc, and soapstone. Production figures for coal, feldspar, pyrites and mica were below those reported in 1924. Except in coal, losses were negligible. Coal showed a loss in tonnage amounting to 508,796 tons and as coal at the mines sold at slightly lower prices during the year the value of the output showed an even greater loss proportionally than the tonnage.

Metal mining in Ontario showed wonderful prosperity in 1925. Gold, silver, nickel, and copper were produced in abundance and in addition to these leading minerals there was a production of almost every other economic mineral with the exception of coal. British Columbia's output of lead, zinc, copper, gold and silver added greatly to Canada's mineral wealth. Quebec's asbestos fields continued to supply by far the greater part of the world's tonnage of this useful commodity; lead, zinc, gold and silver were also reported. Developments in the Rouyn field in Quebec were watched with interest by the mining world during the year. Much progress was made. Alberta, Nova Scotia and British Columbia produced large tonnages of coal in addition to other minerals. Manitoba's mines yielded gold and silver, but more important perhaps than the actual yield of metals was the fact that Manitoba's mineral area was made the subject of a more intense study during 1925, than in other years so that the prospects of production from this source were very considerably improved. New Brunswick's coal and building materials added to the total for Canada. Interest in the oil-well developments in Alberta was very keen throughout the year; it is probable that very encouraging developments will occur in the mineral industry in this province in the early future.

Upwards of 64,000 persons find employment in Canada's mining industry. Ontario, British Columbia and Nova Scotia mines alone fur-

The Budget-Mr. O'Neill

nish employment to more than 45,000 persons. Nearly 20,000 are employed in Canada's metal mining and non-ferrous metallurgical works. About 34,000 people are employed in nonmetal mining and approximately 11,000 in the production of structural materials and clay products. To these salaries and wages totalling approximately $83,000,000 are paid annually. The importance of the purchasing power represented by the employees of Canada's mining industry is sometimes not fully appreciated. Fuel and electricity constitute an expense item reaching a total of almost $20,000,000 a year; much of the progress that has been possible in the mining industry in recent years has been due to the extensive development of hydro-electric power facilities.

Investment in Canadian mines amounts to approximately $632,444,000; of which $281,-

828,000 is invested in metal mining and metallurgical works treating Canadian ores; $259,-

361,000 represents the investment in non-metal mines and $91,255,000 the cost of properties and plants producing structural materials and clay products. .

Mining, now third in rank among Canada's primary industries contributes extensively to the wealth and prosperity of the Dominion. Large tonnages of freight move from and to the mines; many subsidiary industries depend upon the mining industry for their prosperity. Canada's progress in the production of mineral wealth has been notable particularly in recent years; the developments in established fields have won the confidence of the investing public; the discovery of new mineral areas has provided attractive opportunities for those of a more speculative nature; the growth and evident stability of the mineral industry stamp it as one of the great and increasing factors in Canada's industrial and commercial life.

At this point, Sir, I would refer to certain special items in the matter of the mining industry regarding the tariff and sales tax. Here is where 1 may find myself a bit isolated, although I am sure it is the policy of the protectionist party not to advance the interests of one class at the expense of another, and should be, of course, the policy of the government.

With regard to tariff and sales tax, the intention and the desire of the government apparently is to remove or lessen the duties on essential machinery for production in natural resources. The government has been very considerate to us, but there are a number of items where there is discrimination, due in part to the fact that the tariff takes no con-fMr. O'Neill.)

sideration of advances in mining and metallurgical practice, and also due in part to a lack of knowledge with regard to the machinery used by the industry. Following I might mention several items in which this appears to be the case.

There is a considerable consumption of dehydrated borax by the mines, particularly in refining of gold bullion. Ordinary borax comes in duty free, although it is used in the manufacture of a large number of articles which themselves are protected by a duty. The only difference between borax and dehydrated borax is that in the latter some of the water is driven off, but although it is still borax, when imported in that form it pays a duty of 17| per cent.

Mine hoists are not specifically mentioned in the tariff and because of this fact they come in under article 453 and pay a duty of 27J>

per cent plus 5 per cent sales tax. Compressors and wire ropes also pay a high rate of duty and sales tax. If either hoists or compressors are used in the lumbering industry or ropes used in connection with block and tackle, they come in under reduced rate of duty and are exempt from sales tax. This appears to be discrimination against the mining industry in favor of lumbering and as they are both basic industries, there seems little excuse for it.

Rock drills come in under reduced rate of duty and together with drill steel are exempt from sales tax. Drill sharpeners however and steel tempering furnaces pay a high rate ol duty and also pay the sales tax. As the twc latter are used in the manufacture of the drilling bits, it would only seem reasonable that they should be at least exempt from sales tax.

Tariff item 460 provides that, "sundry articles of metal as follows, when for use exclusively in mining or metallurgical operations" shall come in duty free. It appears that the limiting of this to articles of metal is unfair, in some cases. I might point out that steel cyanide tanks come in duty and sales tax free, while wooden tanks, for the same purpose, pay a duty of 25 per cent plus 5 per cent sales tax. You know filters all have filter cloths; American filters have redwood sectors and filter cloths. A complete filter, including the canvas and Redwood sectors, come in duty free, but spare Redwood sectors pay 25 per cent duty plus 5 per cent sales tax and extra cloths or bags pay 35 per cent duty plus 5 per cent sales tax.

I might also mention that crushers, ball mills, tube mills, and so on, come in under reduced rate of duty and are exempt from sales

The Budget-Mr. O'Neill

tax. Cyanide machinery comes in duty free and is exempt from sales tax. Between these two, however, are the classifiers, and the Department of Customs and Excise considers that classifiers do not property belong either to the cyanide machinery or to the crushing machinery, although they are of course essential to both. Because of this classifiers have to pay 274 per cent plus 5 per cent sales tax.

I might also mention that mine cars, and so on, are exempt from sales tax, but the rails on which they run are not. The 6mall mine locomotives, for underground use, which are practically the same as cars, pay a duty of 35 per cent plus 5 per cent sales tax, although they are not manufactured in this country. They perform the same function for the mines as tractors do for the farmers and tractors or locomotives in lumbering operations. Farmers can bring in tractors duty free; lumbermen can bring in tractors and locomotives at 20 per cent, exempt from sales tax. Any person can buy a tractor under a duty of 27i per cent plus sales tax, but the mine locomotive pays a duty of 35 per cent plus 5 per cent sales tax.

It seems to me that the timber used in mining operations should also be exempt from sales tax, because it is really a by-product of farming; also in view of the fact that a certain amount of clearing is done around the mine and the timber is sold. As hon. members know, it does not enter into the final product and timber once put underground has no salvage value. As used in the stopes it is essential to the operation of rock drill and steel, both of which are exempt from sales tax, and as used in the shaft it is essential to the operation of mine cages, cars and skips, which are also exempt from sales tax.

I am also inclined to think it is rather unfair to differentiate to the extent that is done between machinery for the cyanide process and machinery for concentrators, where the same machinery is used in both cases. When used in the cyanide plant it enters duty free and is free from sales tax, while the same machinery used in concentrating ores is not exempt and pays a high rate of duty. Flotation oils, et cetera, are exempt from sales tax when used in the production of a product which itself is not exempt, but when used in connection with gold or silver ores they have to pay a sales tax. These are only some of the items to which I should like to refer.

There is also the question of salt used in the refining of nickel. This is not the ordinary type of salt as manufactured in Canada, but 14011-211

Mr. LIGUORI LACOMBE (Laval-Two Mountains) (Translation):

I feel, Mr. Speaker that it is my first duty to offer my congratulations to the hon. member for Timiskaming-North (Mr. O'Neill) for the enjoyable piece of oratory we have just listened to. His address shall indeed prove a source of inspiration to future generations, as it is replete with such literary gems as they might wish to scatter through their speeches, and it will also convey to them valuable lessons in mathematics, specially in connection with the ground rules.

Mr. Speaker, before dealing with the ,ub-ject matter of this debate, I must first, not only in my own behalf, but also in the name of the French-speaking members of this House, express my sincere admiration for the commendable stand taken by the hon. member for Toronto-Northeast (Mr. Baker) who, when addressing the House on the budget, on the 6th May last, spoke in French. It was all the more gratifying to us to hear that French voice from Toronto as we know that it is inspired by a feeling of sincerity and sympathy, and that it conveys to us the lofty ideals of union, peace and harmony that obtain between the two great races living side by side in this Dominion of ours. I take great pleasure in congratulating him specially for having, as so many others have done previously, urged the use of the two official languages in this country. In view of the fact that no better opportunity could arise under the circumstances, I wish to make a plea, in behalf of my own race, for the vested rights of the French language, not only in parliament, but in the -country as a whole, and I would suggest that, when the government do restore the two cent rate of postage, provision be made also for the issue of a bilingual stamp.

The Budget-Mr. Lacombe

The budget, as brought down by the hon. Minister of Finance (Mr. Robb) whether it deals with the improvement of the economic conditions in the country, the readjustment of our financial standing, or any other matter of great national import, affords quite a diversified field of endeavour to any member wishing to take part in this debate. The population of Canada, I am sure, hailed with a feeling of hope and confidence those reductions which this government has been pleased to bring about in the income tax, the postage rate, and generally in the public expenditures of this country. The striking decrease in our national debt, the general reductions in the taxes which will be a relief to the overburdened taxpayers, the material progress shown in the management of our railways are, in my humble opinion, indicative of the ability and wisdom of those who are entrusted with the administration of public affairs, and also bear witness to their sense of duty and loyalty.

Hardly four years ago when the right hon. leader of the opposition (Mr. Meighen) and his !hon. colleagues were forced by the popular will to relinquish power, the Liberal government had to carry on through the most trying conditions it had ever .experienced. Unemiplojunent waa rampant all over the country. Those who now discuss most bitterly tihis important problem of our national life -were at that time occupying the treasury benches, while the right hon. leader of the opposition was Prime Minister. It was incumbent on those hon. gentlemen enlightened by a sincere and true patriotism, to make up for such inroads on the public funds for which a prodigal and antinational administration were responsible.

Hear, hearl

Mr. LACOMBE (Translation):

On the 15th of April last the hon. member for South Wellington (Mr. Guthrie), in the first of a series of speeches in criticism of the budget, attributed the ever-increasing prosperity of Canada to the magnificent effort of her people and to the liberality of Providence. With all due deference to the hon. member, I beg to state that under the administration of the right hon. leader of the opposition, and of his predecessor, we have been time and again blessed with the gifts of a bountiful Providence and with abundant crops, but the governments then in power did not know how to make the best, in the interest of the Canadian people, of the great opportunities offered by an incomparable nature and the liberality of a generous Providence. Throughout the country, in our immense western

plains as in our rich and fertile eastern regions, when the products of the soil were reaching a promising maturity, when the first and best interests of Canada and her fondest hopes commanded our leaders to act with extreme prudence and to the best advantage of our country, yet too young to be sacrificed on the altar of an exaggerated and blind loyalty, by striking agriculture at its very heart they wrenched from the Canadian farmer his vitality, his strength and the vigorous arms necessary to gather the crop. What has been the result of that guilty enthusiasm? An overwhelming debt, taxation, the instigation of strikes and often misery and agony. So, on December 6, 1921, from one end of the country to the other, there was but one voice to condemn the costly policies of our predecessors. Then the Liberal government entered upon its work of economic restoration, of readjustment of our finances with the generous and sane support of the mandatories of the people. This is why, in a magnificent effort of energy and loyalty our leaders go on legislating for the common weal, with a sentiment of doing their duty and of acting in the public interest.

Allow me, now, Mr. Speaker, to express my views in regard to our tariff policy. I see that the government has cut down the duty on automobiles entering the country, leaving however to our national industry a protection of 20 to 27J per cent. Especially in the course of the last decade the automobile industry has given our 'commerce a tremendous impetus and it is to be counted among the great factors of progress. Even agriculture finds it most advantageous. A touring car had been considered for a long time as a luxury reserved exclusively to people of means. With a true humanitarian outlook our leaders realized that those who toil, work and suffer during long hours of a protracted labour have a right to a share of the rest, of the well-earned relaxation, and of the happiness enjoyed by the rich and the powerful. I believe that will, more than anything p'se be to their credit.

In a. country like ours, with sudh diversified interests, with aspirations often incompatible, the tariff must not sacrifice the interests of one class towards benefiting another, nor injure the rights of anyone. That is why the Liberal government is an enemy to all monopolies and condemns those who impose upon the people. Besides, what did we see under the system of high protection favoured by our predecessors? Our imports were very much in excess of our exports and the balance of trade was turning more and more against us from day to day. My hon. friend the

The Budget-Mr. Lacombe

former minister of Finance (Sir Henry Drayton), who is now laughing, is well aware of the fact. Speaking on behalf of the government the minister of Finance recently announced to the delight of all the Canadian people that our domestic and foreign trade was making Considerable strides, giving Canada a favourable balance of trade of over four hundred million dollars. Are. we not entitled to take some pride in our country when it so readily comes out victorious of the nearly insurmountable difficulties which beset it through the inefficiency of a prodigal and incompetent administration? That is why, Mr. Speaker, I am 'loath to accept the views of certain large interests and contributors to the electoral funds of hon. gentlemen opposite, who apparently are very much put out by the cutting down of the tariff duties on automobiles. On the contrary, the price of the cars being much lower and within the reach of 'almost everybody, there will be, as a consequence, an increased demand. Therefore, instead of hampering that industry the government are expanding lit and giving it a new impulse. I shall go further and, according to the principle that I laid down a moment ago, that the automobile had become a prime necessity, I do not hesitate to say that it would be unfair, in order to give one industry an exaggerated protection, to deprive the farming and other Canadian industries of the valuable opportunity to progress and to reach their goal But should the buying of a car affect the welfare of the poorer class by making them the victim of an exaggerated luxury, I should at once disapprove of the expenditure that the fondness for the automobile involves.

Did hon. members opposite, absorbed as they are in the earnestness of their policy of protection, ever think for one moment of the interests and the unquestionable rights of 'he consumer? Do they forget that an increase of the tariff means more taxation for the people? Do they forget that the Canadian producer is continually requesting the government to find new markets for his products and that the one truly national tariff policy is that which is beneficial to all and hurts nobody. That is what this government had in mind when it established new business connections with European countries. After all, is it not the way of founding the public administration on the principles of sound political economy? Therefore I am glad to pay this compliment to the present members of our government that owing to their sane and enlightened administration Canada is recovering from the crisis that followed the war better than any other country in the world.

The present, budget evidences a state of welfare akin to prosperity and none are more jealous of it than our opponents. Let me tell them very sincerely that pertinacity, economy,

wisdom and efficiency, in conjunction with the so valuable and so varied natural resources of this country, can solve all difficulties, even to paying off the enormous indebtedness that, they forced upon us.

I also notice with pleasure quite a substantial reduction in the postal rates. That re duction relieves all classes of the community: manufacturers, business men, farmers, professional and labour men and will give a new impulse to every line of commercial activity.

The repeal of the receipt tax will be received by the people with a good deal of satisfaction, for apart from the inconvenience inseparable from all taxation, that was the cause of numerous misunderstandings and much trouble.

Realizing that the small wage earners and those who have not the advantage of being wealthy are entitled to as much aid and fair play as possible, this government thought, proper to make some alterations in the income tax act. It is a striking contrast as between the present administration who are not sparing of care for-those who need it the most, and the former Tory government whose protection seemed to be applied only to people favored with a fat purse. In support of this statement I need but point out the income tax exemptions granted by the conservative government to Victory bond subscribers.

Mr. Speaker, before concluding these few remarks, let me take up in this House a statement made recently by the hon. member for South Winnipeg (Mr. Rogers) at Montreal, being the repetition of the ever recurring wail of an opposition (hankering for power. " Where is the government," said he-before the so-called Liberal-Conservative association of that city. I do not know, Mr. Speaker, that the government is anywhere but in the majority of the representatives of the people and only partisans lured by the desire of power can deny it. Does the hon. member forget, that the people of this country have eloquently ratified the decision taken by our leaders to summon parliament and to rule with the majority of its members? Does he forget that the government have won victory after victory in all the by-elections since held and have splendidly increased the majorities received by their supporters in the general election of October 29 last? When hon. members wrongly assert that there is no legislation before the House, I wonder whether they are

The Budget-Mr. Morand

not suffering from the same delusion that blinded them at the opening of the session. But in spite of the erroneous statements spread about by their opponents, the Liberal administration are pursuing their work of economic reconstruction, always progressing in the path of prosperity and carrying out very well the task with which they were entrusted by the people of this country.

Mr. RAYMOND MORAND (East Essex) (Translation):

Mr. PERRAS (Translation):

Where did the hon. member gather such a notion?

Mr. LACOMBE (Translation):

Will my

hon. friend allow me to ask him on what grounds he makes this statement that the province of Quebec is Conservative?

Mr. MORAND (Translation):

Judging

from their ways as a whole.

Mr. RHEAUME (Translation):

Except

their way of voting.