Mr. GORDON GRAYDON (Leader of the Opposition):

I should like to direct a question to the Minister of National Defence. A Canadian Press dispatch, under London, England, dateline of July 11, carried the following paragraph:

It once was thought that when the Canadians went into battle they would go as an army, but the term "army" has changed in meaning since the beginning of the North African campaign.

I should be glad if the Minister of National Defence would inform the house if the carrying out of these Mediterranean operations means that the Canadian army has been broken up, and that its units will now be fighting beside properly reinforced and equipped British and American troops who have had previous experience in other theatres of war.

Hon. J. L. RALSTON (Minister of National Defence):

The Mediterranean operations do not mean that the Canadian army has been

Supply-External Affairs

broken up. I would refer the house to a statement which I made on May 13, 1943, as reported at page 2667 of Hansard. There I said:

. . . there seems to be an idea persisting in some quarters that the role of these units and formations in Canada's army is rigid. I wish to say that exactly the contrary is the case. The role of the units and formations in Canada's army is not rigid; their role is flexible. They can be taken apart on the principle of the sectional bookcase. It has always been and still is our policy that the Canadian army in whole or in part is available to be used wherever and for whatever task would best serve the common cause.

The Sicilian operations mean that this policy is being carried out by detailing from the Canadian army a Canadian force to serve in the Mediterranean theatre. The matter of future employment will of course depend upon developments.

The house in committee of supply, Mr. Bradette in the chair.

Mr. KNOWLES:

I should like to ask the Prime Minister a question relating to the Norway refinery of Falconbridge Nickel Mines Limited. It is a matter which has been mentioned in the house on previous occasions; in fact the Prime Minister had something to say about it on June 3. For reasons which I shall indicate in a moment, I feel that a further-statement is highly desirable.

This matter was first brought to the attention of the house by the hon. member for Rosetown-Biggar (Mr. Coldwell) on May 11. At that time he referred to a statement included in the report to the shareholders which was made by the president of the Falconbridge Nickel Mines Limited, Mr. J. Gordon Hardy. The Prime Minister is well aware of the statement, which was to the effect that he, the president of the company, was glad to get the information that the Norway refinery was still in existence; they had received the information that it was still in operation, though under German control. Some days later, on June 3, as reported in Hansard, page 3282, the Prime Minister made a statement in which he expressed a view which I think is the view of all of us in this house. He said:

We know that the German government is very short of nickel, and it cannot be doubted that it would be to the advantage of the united nations if the Falconbridge refinery in Norway were to be rendered wholly inoperative.

I repeat that with that statement we all agree. The point is however that the statement made by the president of this company

was the very opposite of that which has been expressed by the Prime Minister. He stated in the report as president of the company:

Incidentally, you will be glad to learn-as I was-that through indirect channels it is reported that your Norway refinery is safe so far, and is being maintained. It is in operation by your Norwegian staff, under German control, on the same Norwegian nickel-copper ore production that we formerly handled on toll basis.

I do not wish to convey the impression that I think that Falconbridge Nickel Mines Limited are making any money out of the operations in Norway at the present time. The situation as I understand it, and my view is corroborated by the letter from Mr. Hardy to the Prime Minister under date of May 18, is that the company looks forward to the day, after the war, when it will be possible to regain some of the properties which have been lost because they were in countries that the nazis have overrun, and what the president was doing was to express his pleasure that, although Norway had been overrun, that plant had not been destroyed, it was still in existence; in other words, there was the possibility of the company getting possession of the plant again, intact, after the war. In the letter to which I have just referred under date of May 13 to the Prime Minister, Mr. Hardy endeavoured to say that if the context of the wording quoted by Mr. Coldwell were presented the situation would appear in a better light. However, in that letter Mr. Hardy says:

The loss of that refinery to the enemy in April, 1940, was a severe blow to this company, hence the possibility of regaining it when victory comes, has meant a great deal to this Canadian enterprise, and any news about the refinery has been most important to our shareholders.

I remind the Prime Minister again of the quotation from the report which I have already read. Perhaps a further sentence or two might be given:

In the balance sheet you will have noted an inventory item reading "Matte on hand and in process at cost". This includes the parallel item shown in your auditors' statement of assets and liabilities in Norway in-

I assume he means "in the amount of."

-$1,009.068-which has not been written off as yet, but simply covered by a claim posted with the Canadian custodian of enemy property. As a matter of fact, of course, this has undoubtedly gone into production of refined metals under enemy control, and has disappeared and hence will have to receive some sort of adjustment at the end of the war.

The point is that when your auditors give your "net working capital" at the end of 1942 as $6,238,598, the above item is included with "total current assets and metal inventories".

A reading of the context of the statement which was brought to the attention of this

Supply-External Affairs

house on May 11 only stresses the point that the president of the company took a view directly the opposite of that expressed by the Prime Minister. The Prime Minister said that it would be to the advantage of the united nations if this plant were rendered wholly inoperative; the president expressed pleasure that the plant was still in existence so that the company would be able to get it again when the war is oyer.

My reason for raising this again and expressing the view that the Prime Minister ought to say something further about it is this. On June 3, when the Prime Minister spoke, the hon. member for Rosetown-Biggar asked if the government would not take some further steps. The Prime Minister said in reply: [DOT]

Well, I may say that the statement which I have just made will, I believe, be more effective in its results than any other measure which the government could possibly take.

Some days later, as a matter of fact on June 23, sessional paper No. 405 was brought down in response to a motion made by the hon. member for Rosetown-Biggar which asked for correspondence between the Prime Minister and Mr. Hardy concerning this statement. The correspondence in the sessional paper consists of only two letters. One is a letter from Mr. Hardy to the Prime Minister, from which I have already quoted, and which endeavours to explain and to justify the statement, and the other is the reply signed by Mr. H. R. L. Henry, private secretary to the Prime Minister, in which he says:

The Prime Minister has directed me to acknowledge your letter of May 13th. regarding remarks by Mr. M. J. Cold-well, M.P., in -the House of Commons, with reference -to Falcon-bridge Nickel Mines, Limited.

Mr. King wishes me to thank you for drawing the enclosures with your letter .to his attention.

The point is that, following the tabling of this document in the house on June 23, considerable publicity was given to it throughout the country. I saw it myself in a number of newspapers from widely separated parts of the country, and, incorrect though it may be, the impression was created by the publication of the news of these letters that Mr. Hardy had made a satisfactory answer both to the hon. member for Rosetown-Biggar and to the Prime Minister. It is true, of course, that this correspondence took place- -before the Prime Minister made -his statement in the house, but it was tabled later, publicity was given to it later, and I repeat that the general impression is that Mr. Hardy has given a satisfactory answer to the criticisms made by the hon. member for Rosetown-Biggar and

supported by the Prime Minister. I am sure that if the Prime Minister studies the documents he will agree with me that the answer is not satisfactory, that it should be deprecated in the manner in which he did so on June 3, and I hope he will make a further statement on the matter at this time.

Right Hon. W. L. MACKENZIE KING (Secretary of State for External Affairs):

I fail to see how the impression which my hon. friend says -has got abroad could possibly be the im-pression existing -throughout the country. That is a matter of opinion. The statement I made in this house condemned-perhaps that is not too strong a word to use-the very shortsighted, unwise and, I might add, unpatriotic statement made by Mr. Hardy, and I a-m certain that the public have fully recognized that the government looks upon his statement in that light. The acknowledgement sent by my secretary to Mr. Hardy's letter was a perfunctory acknowledgement. It allowed Mr. Hardy to see quite clearly that the government might make further reference to the matter. This further reference I made in the House of Commons. I do submit that having stated here in the House of Commons, as Prime Minister, that a statement made by the head of a mining corporation in this country was unwise and foolish, and that by implication it was unpatriotic, was making it very clear to the country -that the government had no sympathy whatever with the pronouncement and, on the contrary, condemned-it very strongly.

Mr. KNOWLES:

I would remind the Prime Minister that after he made his statement in the house these documents were made public, and, as I say, this sentence in particular was given wide publicity. It is a long sentence; I need not give the whole of it, because it is the last phrase that is important:

. . . and certainly does not merit the slur contained in Mr. Coldwell's ill-conceived remarks.

Mr. MACKENZIE KING:

Read the whole sentence.

Mr. KNOWLES:

Very well. The sentence reads:

I could add that, in spite of this setback, the Falconbridge effort to do all in its power to produce such essential metals as nickel and copper for the war requirements, is well known to your munitions and supply department, and certainly does not merit the slur contained in Mr. Coldw'ell's ill-conceived remarks.

My point is that this statement, together with the perfunctory acknowledgment by the Prime Minister's secretary, are the last words which have appeared in the press on this

Supply-External Affairs

matter to date. That was my reason for feeling that a further statement, condemning this statement outright, should be made by the Prime Minister.

Mr. MACKENZIE KING:

Well, I will condemn it outright now. I think it should be condemned outright, and if my condemnation on a previous occasion was not sufficient I shall be glad to repeat everything now that I said on that other occasion.

Mr. CHURCH:

Just before eleven o'clock last evening I was discussing the estimates of this department and had called attention to the fact that in this item, which has to do with representation abroad, including salaries of high commissioners and so on, there is an increase of $211,000. With all due respect, Mr. Chairman, I do not see why we should have such an increase. This department has been growing by leaps and bounds. If it contributed to the war effort it would be all right, but I do not see that it does. I should like to see the Prime Minister's estimates, more than those of anyone else, go through as quickly as possible, but the opposition is not to blame for a discussion of these estimates lasting more than a day. Speeches have been made by government supporters, on July 1, on Monday of last week and again even more recently, about matters which I have said should be left until after the war, including a national anthem, a national flag and many other matters. The Prime Minister is a busy man and should receive some special consideration in view of the amount of work he is doing, but all along I have objected to the expansion of this department, to the opening of these legations and the sending abroad of ministers. We have always had trade representatives in these countries as well as other agencies, such as boards of trade and private organizations, looking after this work. It all began with the opening of the legation at Washington, when I first came into this house. I opposed that innovation, because I believed it was dividing Britain's representation.

The hon. member for St. Lawrence-St. George stirred up a great deal of opposition to these estimates by the remarks he made in this house the other day. At that time he gave one good reason why he never should have become a parliamentary secretary; for his remarks have caused wide disunity not only in Canada but also in other parts of the empire. His words received extensive pub-. licity all over the United States. He was one of those favoured on the radio. He was also favoured with a visit to the United States, where he told the people, as Mr. Brockington told them, that King George did not declare

war for us but that we declared war for him, and all that sort of separatism in the midst of the greatest war in history. I have a great deal of respect for the Prime Minister; I have always had a great deal of respect and friendship for him, but friendship cannot alter my stand on principles which I have supported in and out of this house, before the war, in endeavouring to avoid the war, and since the war began. I represent in this house, as the former leader of this party, Lord Bennett, said, a very large body of public opinion in this country which believes in the need for the greatest possible cooperation and coordination with the mother country both for the remainder of the war and particularly after the war. If we are not linked with this great empire we shall have little say in regard to the peace terms and will be simply an outcast amongst the great powers of the world at the peace table.

Here we have almost a million dollars being spent in this way, and in addition we have the four or five million dollars we. have spent on the League of Nations, one of the agencies that caused this war. So far as these ambassadors go, they have not had any training for this work; they are just civilians who know nothing about foreign affairs. Our representative in Australia, Mr. Davis, is a very fine gentleman, but he went there and said that Japan, not Germany, was our principal enemy. He caused a great deal of dissatisfaction by those words, even in those dominions, because Germany is our main enemy; she pulled Japan, one of our old allies, into the war at the time of Pearl Harbor. The few mistakes Germany has made, in attacking Russia and in bringing about Pearl Harbor, no doubt will cost her the war sooner or later, but I do object to these amateur statesmen, for that is all they are. You cannot learn to be a diplomat in a day. The best diplomats we ever had in Washington were not the newspaper men we sent there, not the civilians but trained men like Spring-Rice and Lindsay. Then we have another representative, General Odium, a fine citizen and a fine soldier; he visited the city of Toronto and caused some disunity and criticism by the unnecessary aspersions and reflections he cast upon Toronto and Ontario, the empire province of the dominion.

I have wondered why no reference has been made to what was said the other day by Mr. Churchill in his letter to the former premier of northern Ireland, Mr. Andrews. Why has it been necessary to establish embassies in the north of Ireland and not in the south? It is said that southern Ireland is a part of the empire, but it has remained neutral and that step has been very costly to our shipping, our

Supply-External Affairs

I read the address of Sir Keith Murdock delivered in London, England, when he asked for the creation of a war time cabinet, such as we had in the last war. It would not be necessary for the Prime Minister to go to London because someone else could fulfil his functions. But nothing was done and the result is that now on foreign affairs we are just moving from week to week and from month to month nowhere.

What Canada did in the last war was done voluntarily. Eor the last forty years we have helped the mother country when she was attacked, and we will do the same thing tomorrow and go to her help in her hour of peril. We will continue to do what we have always done as a unit in this empire. After all is said and done, we had a previous suggestion which was similar to that made by the hon. member for St. Lawrence-St. George. On March 31, 1939, a bill was introduced by the Hon. Mr. Thorson which declared to the world that if war came Canada would be neutral; she would have the status of a belligerent. This relying on status is just a pipe dream. We threw away our defences and our friends and the result was that when the war broke out we had to depend upon the mother country as in 1812 for all our defence. If it were not for Mr. Chamberlain and Munich and Dunkirk, long ago Washington and Ottawa would have had to make peace with the axis powers. When this bill was before the house on March 31, 1939, I expressed the same sentiments that I am expressing now. This bill sought to establish the status of Canada in war time. At that time I said:

The hon. member is evidently opposed to the former leader of the Liberal party, Sir Wilfrid Laurier, who said that when Britain is at war, Canada is at war. Let me say to my hon. friend that Canada is not going to be talked out of the British empire. If Canada could have been talked out of the British empire, it would have been talked out long ago by some of those who came to Canada a few years ago and are enjoy-lng all the privileges and rights and liberties ot this country, but who refuse to pay tribute to the mother of nations who gave us these liberties .and the freedom and civilization we all enjoy. Everything we enjoy in this dominion to-day we owe to the protection of the British flag and the United Kingdom.

That bill did not pass and it did not come up again that session because within three months war was upon us. I agree with much of what my former leader, the hon. member for York-Sunbury (Mr. Hanson), said yesterday about the duty of cooperation and coordination with the mother country until the end of the war and after. Any other remarks I may have to make on this matter I shall make at another time. This talk of our being

a separate unit and all that kind of thing is just a repetition of what has been said before. The other day we heard Mr. Benes say that he wanted to get back after the war to his own country, Czechoslovakia. There will always be nations; patriotism is the cement that binds nations together. The downtrodden countries will be rebuilt. There is no use looking to somebody else to establish economic units in Europe, because they will never come. As a great author said long before the war, this country does not belong to those who inhabit it to-day; it is an inheritance from the past; it is a possession for the present, a trust for the future. Do not forget that we are only here to-day and away to-morrow. I believe in the British empire, past, present and future, and in the colonial empire and all that it stands for down the ages. One of the most glorious things in the history of the empire is the way the colonial empire policy has been administered, and there will be a further glory after the war in the days that are to come in the new empire.

In my opinion some of the dominions before the war were nothing but a drag on the mother country. Canadians all shouting "status" from the housetops and isolation and separatism and all that sort of thing. The people of this country do not believe in any such policy as that. The policy before the war, in 1936, 1937, 1938, and 1939 was special pleading, no overseas troops, no commitments, and so on. It would be far better if the people of Quebec knew the facts about these obligations that are being assumed by these proposed changes in the British North America Act. That is wrapped up with external affairs and the right to change our constitution from time to time. We are supposed to have separate status, which is wrapped up with the statute of Westminster. They say that they want another anthem and a flag, but the winning of the war should be the primary consideration to-day, not the secondary consideration of such matters.

This is the second time we have sent troops across the seas. This is the second time we have asked for a change in the British North America Act. We are the only dominion that has asked for a domestic change during the war. I want to draw just one other point to the attention of the Prime Minister. This is in connection with the lease-lend act and the state of affairs that will follow when we become linked up with that. It will be remembered that when the United States came into the war they loaned one hundred. General Grant tanks to the British eighth army. I should like to quote what Mr. Denys Smith had to say about this. He said;

Supply-External Affairs

A hundred or so General Grant tanks sent to the British eighth army to aid in the defeat of Rommel were obviously welcome. A hundred or so tanks and also tank crews to man them would have obviously been even more welcome. But the lesser contribution becomes lease-lend aid and a charge against Britain, while the greater contribution would not. The Lease-Lend Act, in brief, has saddled the United Nations with an illogical principle which means that a certain type of the United States military effort is segregated and assumed to be the financial responsibility of others.

It goes on to say:

Nobody can tell what type of American Congress and administration will exist after the war or how it will employ the pressure weapon provided by lease-lend accounting. A great deal has been said about reciprocal lease-lend. It is undoubtedly useful to keep the American public aware of the fact that every nation provides its allies with aid without immediate cash compensation. But the material aid provided to the United States is never likely to be as great as that which the United States provides. It is time more attention was paid to the fundamental fallacy underlying lease-lend accounting or there may be a danger after the war of the world once again being saddled by a stifling blanket of inter-governmental debt.

It goes on to say, referring to Mr. Churchill's remark that he had not become the king's first minister to preside over the liquidation of the British empire.

What a terrible remark to make, these two groups complained. It would have been perfectly all right for the British prime minister to announce that the United Kingdom was fighting to prevent the liquidation of anybody else's territory, but to try and prevent the liquidation of British territory was the acme of selfishness.

I believe that the great masses of the American people have been right with us from the start of this war and before. But we must not forget that the United States is a cosmopolitan country. As the Manchester Guardian said before the war started the United States has quite a large population from Europe, Chicago being the second largest German city in the world. We rejoice in having this great country as our ally.

I appreciate what the Prime Minister has done. I have a great respect for him. He is a man of affairs and has worked hard on our external policy. I do not wish him to take anything that I have said this morning as spoken in a critical but constructive spirit. I am simply pointing out certain dangers to him. One of the members on the government side made a speech which I did not think was in the interest of inter-imperial relations but would tend rather to cause wide divisions among the dominions, and would not make for the good conduct of the war. I have taken a great deal of interest in foreign affairs for a number of years, and I want to say that the Prime Minister has been consistent

from the start on his status policy, while I have opposed it. We never wanted this war and it was not the Prime Minister's fault alone that it came.

Mr. FRASER (Peterborough West):

Can the Prime Minister tell us what the wartime information board is doing with regard to South America? I understand they are sending a Mr. Ross down there next month.

Mr. MACKENZIE KING:

There is an item under the war appropriation bill that relates to the wartime information board. When we reach that item I intend to make a full statement on the board and its work. Perhaps my hon. friend would not mind deferring his question until then.

Mr. FRASER (Peterborough West):

I

thought we were on that right now.

Mr. MACKENZIE KING:

No.

Mr. GREEN:

Will the Prime Minister tell us whether there are any negotiations under way for the setting up after the war of an air route from Canada to Australia and New Zealand similar to the air route across the Atlantic in which Canada, Newfoundland, Eire, and Great Britain are to be partners? It is of great importance to those of us who live on the Pacific slope that there should be air connection with Australia and New Zealand and it would be of great interest to know whether any steps have been taken leading to the setting up of such a route, and if not has the government such negotiations in mind?