Mr. BENNETT:

It is not that sort of an

organization; it is a selling organization.

Mr. EULER:

If there is any loss, the government will sustain it?

Mr. MACKENZIE KING:

Am I right in understanding that this guarantee is given under the Unemployment Relief Act?

Mr. BENNETT:

I believe the correct

name is the Unemployment and Farm Relief Act.

Mr. STEWART (Edmonton):

Has anything of this character been done with last year's crop or is it just in connection with this year's crop?

Mr. BENNETT:

It has been done with respect to last year's crop. Since 1930 when it was taken over this organization has permitted the possible marketing in this country of Canadian wheat.

Mr. WEIR (Macdonald):

Will the Prime

Minister be good enough to explain the present position of the durum wheat growers in Manitoba who delivered their crop to the 1930-31 pool which Mr. McFarland took over? There are about a thousand of these men who have been treated rather unfairly and I was wondering if the Prime Minister had an explanation to offer.

Mr. BENNETT:

The hon. gentleman

knows as well as anyone that that is not a

matter with which the selling agency had to do. The Manitoba wheat pool purchased the durum wheat and under the provisions of their contract there was to be an adjustment so that the seller would receive what had been stipulated in the contract. Unfortunately this organization, which is not the one Mr. McFarland controls, has not been able to make any such adjustments.

Mr. WEIR (Macdonald):

The point is

that Mr. McFarland took that wheat over and was responsible for the ultimate selling of it.

Mr. BENNETT:

Mr. McFarland was

accountable to the Manitoba wheat pool to which he did account. The contract was between the Manitoba wheat pool and the growers themselves and no one else. I trust the hon. gentleman will realize that there is no contract between the selling agency which Mr. McFarland manages, and the growers. He had no relations with them, contractual or otherwise. Any grain he received was, like the wheat he received, from the Manitoba, Saskatchewan or Alberta wheat pool. He received that for sale and dealt with them on that basis.

Mr. DONNELLY:

If I understand aright what the Prime Minister said, if there is a loss in this hedging operation of the selling agency of Mr. McFarland, then the banks make up the loss and the government makes up that loss to the banks. But on the other side, supposing there is a profit, do the banks, or does Mr. McFarland as a selling agent, or does the government take the profit? How does the Prime Minister think this arrangement will assist the seventy municipalities that had no crop whatever this year and will have to buy their seed for next year?

Mr. BENNETT:

I am sure, Mr. Speaker,

you have been very generous in extending the widest possible latitude in regard to questions; but when you get into that of relief to municipalities, you are far away from the question under consideration. The advances made by the banks are guaranteed by the country and if, after payment of the advances, a profit remains, it belongs to the agency and not to the government.

Mr. VALLANCE:

I should like to ask

the Prime Minister a question based on the reply which he gave to the hon. member for Macdonald (Mr. Weir): Is he telling us now that John I. McFarland was in the employ partly of the government and also of the Manitoba pool sales agency?

Wheat Marketing

Mr. BENNETT:

He said nothing of the

sort. Why should the hon. gentleman endeavour to mislead? If he had followed me, he certainly could not have made that statement. Mr. McFarland is receiving no salary from anyone. The most experienced grain man on this continent once told me he believed Mr. McFarland was the best grain man in North America. Whether he was right is a matter of individual opinion. Mr. McFarland was not appointed by this government. He was appointed to his position, not by the Manitoba pool but by the Canadian Cooperative Wheat Producers, Limited, and the appointment, needless to say, was warmly approved by the government. He has been carrying on since on that basis.

Mr. POULIOT:

As the right hon. gentleman has said that it would serve no good purpose to give any more details about the situation and as the explanations that he has already given are most interesting, would he have any objection to having the galleries cleared in order that he may give full information to the house? I have asked the Prime Minister for an answer.

Mr. SPEAKER:

No.

Mr. YOUNG:

Is it the intention of the

government to permit this transaction to be carried on indefinitely, or is there an understanding as to the probable date when it will be terminated?

Mr. BENNETT:

No one knows better

than does the hon. member for Weyburn the difficulty of answering that question. Obviously he knows you could not say that you would do it on this date or that, but it will be done because you must consider the market situation from the standpoint of the producer. If it were desired to wreck the market, that could be done. If it be desired in an orderly or regular manner to dispose of the crop, that cannot be done until such time as the absorbing power of the market enables the transaction to be completed without stress.

Mr. LAPOINTE:

Referring to the matter

of advances, mentioned this afternoon, has an order in council been passed covering this question?

Mr. BENNETT:

I think the matter was

covered by letters to the banks. That is my memory of it. There may be an order in council. I will look it up and let the hon. gentleman know. But there were orders in council with respect to all the assistance given by the government to the Alberta, Saskat-

chewan and Manitoba pools, and the orders in council last year were tabled just as the orders in council this year have been tabled. No liability has arisen under any of these orders in council nor is there likely to be any so far as I know, but owing to conditions of which this house has full knowledge it was thought to be in the national interest that the situation should be clarified to enable the working capital of the pools to permit them carrying on their operations without question, and the guarantees were given to them, and I think copies of all the orders in council have been laid on the table of the house.