Mr. MARCIL:

Mr. Chairman, I have no doubt that the Prime Minister of this country has a perfect right to introduce a resolution of this character, but I understood that such matters were under the control of the Minister of Marine (Mr. Duranleau). Has the minister given up his job in this connection? If these matters are to remain under his control, what will be his policy when it comes to buying other stations?

Mr. LAPOINTE:

The radio business is under the control of the Minister of Marine. As a member representing the province of Quebec of which my hon. friend is the representative in the cabinet, I resent this matter being put through by anyone other than the Minister of Marine. What will the minister's policy be when it comes to buying station CHLP as well as the other stations in the Canadian National system. I do not think my hon. friend should allow any one of his colleagues, let alone the Prime Minister, take charge of his department and move a resolution which should be moved by the Minister of Marine.

Mr. DURANLEAU:

The leader of the government is a proper person to present such a resolution to this house. I had thought that this resolution would have been adopted without much discussion. It is quite evident that hon. members opposite are trying to make

4246 COMMONS

Radio-Purchase of C.N.R. Stations

political capital out of this question. The purchase of the Canadian National system by the radio commission is the best arrangement which could be made under the circumstances. Everyone knows that.

I do not know it.

Mr. DURANLEAU:

We are purchasing

five stations for $50,000. The radio commission went to the trouble of ascertaining just what these stations had cost, and it was found that the total cost amounted to $132,000. My hon. friends are asking if this is to be the basis upon which purchases will be made in the future. The basis of a purchase made by mutual agreement is the one accepted by the parties to the agreement. In case of disagreement, the parties will resort to arbitration. Then it will be the duty of the arbitrators to determine, according to the statute, the basis of the price and to decide whether an allowance for good-will will be made or not. I hold that this particular purchase is in the interests of the radio commission and of the Canadian National Railways. Radio broadcasting was not a profitable business for a railroad company, and the Canadian National Railways wanted to get rid of their stations. The Canadian Pacific Railway never were in this business.

Mr. CASGRAIN:

They are broadcasting.

Mr. DURANLEAU:

Hon. friends opposite are trying to make political capital out of this matter. They claim that we are trying to place the Canadian National Railways in a disadvantageous position as compared with the Canadian Pacific and they made that claim knowing that the Canadian Pacific did not own any radio station.

Mr. ELLIOTT:

By whom was the valuation made?

Mr. MANION:

I think I can .answer that question. The board of directors of the Canadian National Railways in consultation with the management and without consultation in any shape or form with this government lecided to sell the broadcasting system of the company. I repeat that that decision was arrived at without consultation with this government. They decided to get out of the business because they considered it was a losing proposition.

Mr. RALSTON:

The deputy minister is on the board.

Mr. MANION:

He is one of seventeen members on the board. My hon. friend, on one of his periodical visits from Montreal, now claims that the deputy minister was on the

board. Certainly he was on the board. The deputy minister was on the board in 1929 when my hon. friends in the late government permitted the Canadian National to commit the country to $250,000,000 worth of expenditure. If that government was willing to take all that responsibility, probably we shall have to take it for this. But the deputy minister was not instructed by this government. The board of directors of the Canadian National Railways decided to sell; they approached the radio broadcasting commission-and I have the correspondence under my hand-and the radio commission made them an offer of $50,000 plus rents, which have not been mentioned here, for the broadcasting studios in the hotel at Halifax, the hotel here, the office at Moncton and the building in Vancouver, so that they pay rents as well. After some consideration by the Canadian National and the radio broadcasting commission, the offer of the radio commission of $50,000 was accepted. We were not consulted about it and knew nothing about it as a government until the transaction was completed.

Mr. SPEAKMAN:

The Minister of Railways gave us the annual cost to the Canadian National Railways of the broadcasting system during past years running from $80,000 last year to as much as $400,000 a few years ago. Was that cost wholly connected with the broadcasting or did it include receiver sets on train coaches and so forth, the whole receiving end as well?

Mr. MANION:

It would include all that, although it is not set out in the statement, except that it was operating expenses.

Mr. SPEAKMAN:

Let me ask one other question. The mere sale of broadcasting stations does not in any way preclude the Canadian National Railways from utilizing the broadcasting stations by setting up the receiving system?

Mr. MANION:

No but they have gone out of that.

Mr. SPEAKMAN:

Do they intend to continue with that end of it?

Mr. MANION:

Not so far as I know.

Mr. ELLIOTT:

I gather from the minister's remarks that no valuation has been made of the stations by anybody familiar with the value of such stations.

Mr. MANION:

The leader of the government stated that a valuation was made last year, and they were valued a year ago at $70,000. I have no further information than that.

Radio-Purchase of C-N.R. Stations

Mr. ELLIOTT:

That was the valuation of the committee and it was not accepted.