April 20, 1944

CCF

Joseph William Noseworthy

Co-operative Commonwealth Federation (C.C.F.)

Mr. J. W. NOSEWORTHY (York South):

Has the Department of Labour or the national wartime labour relations board received any protest from the association of technical employees against the reported decision of the" board excluding professional employees from the provisions of the new wartime labour relations regulations, and, if so, what consideration is being given to the protest?

Topic:   LABOUR CONDITIONS
Subtopic:   EXCLUSION OP PROFESSIONAL EMPLOYEES FROM PROVISIONS OF P.C. 1003
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LIB

Paul Joseph James Martin (Parliamentary Assistant to the Minister of Labour)

Liberal

Mr. PAUL MARTIN (Parliamentary Secretary -to the Minister of Labour):

I thank the hon. member for having given me notice of his question. It is true that a protest has been received from the national chairman of the association of technical employees with regard to a reported decision of the national wartime labour relations board excluding professional employees from the provisions of the wartime labour relations regulations under P.C. 1003. With regard to the consideration being given to the protest, it is necessary to quote the decision of the board, which reveals that such protests and their consideration have been anticipated. The decision of the board reads in part as follows:

. . . for purposes of the regulations', persons employed in a professional capacity shall be [Mr. Coldwcll.l

deemed to he employed in a confidential capacity, with the board reserving the right to review its decision in six months.

It will be recalled that the wartime labour relations regulations exclude from "employee" as defined, persons employed in a confidential capacity. By reserving the right to review its decision the board has realized that all interested parties require time in which to prepare their cases for presentation to the board at a subsequent date, when the matter will come up again.

Topic:   LABOUR CONDITIONS
Subtopic:   EXCLUSION OP PROFESSIONAL EMPLOYEES FROM PROVISIONS OF P.C. 1003
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INQUIRIES OF THE MINISTRY

STATEMENT OF MR. SPEAKER AS TO QUESTIONS ASKED ON ORDERS OF THE DAY


On the orders of the day:


LIB

Thomas Vien (Speaker of the Senate)

Liberal

Mr. SPEAKER:

I would point out to hon. members that questions of a kind which should not be asked on the orders of the day should not be answered when so asked. I have endeavoured to enforce this rule as far as possible, but I must have the assistance of the house in regard to it. These questions should be placed on the order paper. To-day several questions of this kind have been asked and answers have been given. I do suggest that questions which are improperly asked should not be answered. *

Topic:   INQUIRIES OF THE MINISTRY
Subtopic:   STATEMENT OF MR. SPEAKER AS TO QUESTIONS ASKED ON ORDERS OF THE DAY
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PRESS REPORTS AS TO SUSPENSION On the orders of the day:


NAT

Gordon Graydon (Leader of the Official Opposition)

National Government

Mr. GORDON GRAYDON (Leader of the Opposition):

I hope the question I am about to ask will be in order; it is prompted by the fact that to-day we welcome back the Minister of Finance (Mr. Ilsley). We are pleased indeed to see him looking so well, and hope his health will continue to be good. On Monday of this week I asked the Prime Minister a question with respect to the Hyde Park agreement, and the right hon. gentleman was good enough to indicate that he would answer the question when the Minister of Finance came back. I am. only mentioning the matter now as a reminder, in the hope that we may expect an answer soon.

Topic:   INQUIRIES OF THE MINISTRY
Subtopic:   STATEMENT OF MR. SPEAKER AS TO QUESTIONS ASKED ON ORDERS OF THE DAY
Sub-subtopic:   HYDE PARK DECLARATION
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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Hon. J. L. ILSLEY (Minister of Finance):

I had hoped to be able to make a statement to-day, but it will not be possible for me to do so. I expect to be able to make the statement either to-morrow or Monday.

War Appropriation-Transport

Topic:   INQUIRIES OF THE MINISTRY
Subtopic:   STATEMENT OF MR. SPEAKER AS TO QUESTIONS ASKED ON ORDERS OF THE DAY
Sub-subtopic:   HYDE PARK DECLARATION
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WAR APPROPRIATION BILL

PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY


The house resumed from Tuesday, April 18, consideration in committee of a resolution to grant to His Majesty certain sums of money for the carrying out of measures consequent upon the existence of a state of war-Mr. Ilsley-Mr. Bradette in the chair. DEPARTMENT OF TRANSPORT Air services branch- S. Civil aviation: operation and maintenance of municipal (terminal) airports, $398,260.


NAT

Douglas Gooderham Ross

National Government

Mr. D. G. ROSS (St. Paul's):

I should like to say a few words in connection with civil aviation. There are many aspects of the problem, . and when one reads the minister's statement respecting the domestic problem of aviation, and also the international air transport convention, he realizes the vastness of the subject. To my mind however the whole international situation is wrapped up with the question of civil aviation. This matter is both international and domestic, and the settlement of the whole problem will not be easy.

I should like to make a few observations respecting the domestic problems. It is proposed to set up a board, something like the board of transport commissioners, and, as the minister said, it will be charged with the responsibility of-

-advising the government on ways and means of bringing about a rapid and well-planned expansion of transport by air. The proposed board will examine the needs for new commercial services, and make recommendations for their establishment and expansion, in both the domestic and international fields; receive applications for the services and issue commercial licences; establish tariffs and regulate rates; examine the ownership, financial structure, operations, and financial position of carriers; make recommendations for needed financial assistance; advise the government on matters affecting the operation of existing aerodromes; report on the need for new aerodromes; and perform such other allied duties as may be determined.

I agree that this board should be set up, but I think it should be the intention of the government to give the board absolute freedom of action. They should have as much latitude as possible, should act as a judicial body, and should not be interfered with. The board must be free from government or political control, in order that it may operate in the best interests of Canada.

As the minister has said, the board will make a study of the whole situation. From time to time it will have to make decisions, and for that reason it must be free from

political control. I believe Canada should wake up to the necessity of expanding, particularly in the field of air transport, farther than we have gone so far; but that expansion must be'carried on through both public and private ownership. The board will be necessary under any circumstances, even if the government were to agree to the operation of Trans-Canada Air Lines as a non-competitive and non-profit system, with a monopoly of trans-Canada traffic. As the minister pointed out, a second system would probably be wasteful and unjustified at the present time. This may be so just now, but I must point out that our decision as to whether we should have a competitive system in the future will depend on the service given by the one publicly-owned system.

The minister points out he does not want to have a second system in competition because, as he has suggested, we have had an example of ruinous competition in our transportation systems. But I do not think competition in railway transportation systems, as we have seen it before, is parallel with the air transport situation. Moreover, it was competition not only between two systems, but among various systems subsidized by the government. That was what got us into trouble. There was the idea that Canada was not being adequately served and was not expanding sufficiently with one railway system, the Canadian Pacific. There was a clamour on the part of the public for further systems, and when those systems were instituted they found it easy to get subsidies of one kind and another from both provincial and dominion governments. We did in fact get into a serious situation.

The position in connection with air travel is not the same. As I see it, there is no doubt that Canadian Pacific Air Lines is threatening the position of Trans-Canada Air Lines in Canada. But Canada was fortunate in the fact that the Canadian Pacific Railway Company entered the field of aviation. We should be very thankful for the work it has done. I doubt very much if the north country in Canada would have been opened up to the same extent, during the difficult days through which we have passed, had it not been for the enterprise of the Canadian Pacific Railway Company, and its formation of Canadian Pacific Air Lines. In those times the small and independent private companies, or bush lines, for various reasons were on the verge of ruin. That was not altogether the fault of the former government, but rather the result of the times through which we were passing. Canadian Pacific Air Lines paid fair prices for

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those lines, and in many cases gave employment to the men who had been their originators.

I think, too, that the Canadian Pacific Railway Company had in mind their tardiness in entering the field of bus and motor traffic, and they did not want to have a repetition of that type of competition in respect of air lines. Altogether it is my view that they deserve a great deal of credit for the position they have taken. There is no doubt that the divorcing of the air companies from the railways is a blow to the Canadian Pacific Railway Company. It may be justified at the present time-the minister seems to think it is, but I have some doubts about it. It is my view that a great deal of study is required before such a drastic measure is adopted. The same would apply to the divorcing of Trans-Canada Air Lines from the Canadian National Railways. Much study is required before that is done.

The minister has made a statement with respect to leaving the bush routes and feeder lines open to returned men. Well, to my mind that is just so much eyewash. Why has the minister changed his mind on this point? In 1937, as reported at page 2216 of Hansard, the minister said:

In my view it is only reasonable that the railways should have a part in the development of air transportation.

Then the minister went on to give his reasons, and said:

In the first place they are in the transportation business; and in the operation of air lines there are problems in common with the operation of railways.

What are these problems? They are maintenance of equipment, overhaul of equipment, the safety of passengers, and all that sort of thing. Can that be done better by a number of small companies, or can it be done better by one large company? The safety of passengers is a matter which must be given careful consideration. The minister went on to say:

For instance, both must have ticket offices; both must have facilities for soliciting express and passenger business. The legal problems of both are more or less on a par, and a legal staff trained to railway transportation matters would be valuable in air matters. I could set out many other points where the services are more or less parallel.

As I pointed out a moment ago, there would be the question of overhaul, maintenance and so on. The minister continued:

So it seemed to me from the start that in a properly organized trans-Canada system the railways should have a part.

The minister made a pretty powerful argument in 1937 for railway participation in civil aviation; why has he changed his mind? He continued:

In any event, after the consideration of these matters the government has decided that its agency for transportation, the Canadian National Railways, should be the means of organizing this company, just as it was used as the means for operating such shipping as the government has owned, and the means of operating other government transportation facilities.

The Canadian National Railways, as the originator of Trans-Canada Air Lines, had to Share the aeroplane business of Canada with the Canadian Pacific Railway Company, but, as the minister pointed out in his statement, the Canadian Pacific did not choose to enter into an agreement with the government. On the other hand, as I have indicated, they have done a splendid job in building up feeder lines and generally developing Canada. The minister continued:

The question now arises: Have we invited the private interests to participate? That question was asked. May I say we did not need to invite them. They came from every part of Canada and the United States, and put on the most persistent lobby in Ottawa that I have ever seen.

Will that lobby be repeated? The minister continued :

The only way we could make progress was to absolutely refuse to talk to them. We said, "Go back home. We will write our bill, and when we get it written and bring it down you will see it. If you then want any part in it we will give you the chance to discuss the matter." How could we make a deal on the one hand with perhaps a dozen clamouring aviation companies, or with one or two of them, and on the other hand bring down a bill which the government or parliament would approve?

Are we to have the same situation develop under this new system proposed by the government? The minister continued:

The thing was absolutely impossible. Some one had to make up his mind as to the proper set-up, pick out the responsible people to take care of the initial financing, and after that sit down and see what these services had to offer in the way of experienced personnel, trained operators, and so on; and then decide whether one, two, four or some other number of private companies should be associated in the new organization, whether each would give it strength or otherwise, and then determine the final set-up accordingly.

Many years have gone by, and the Trans-Canada Air Lines and the Canadian Pacific Air Lines have been developed. I am amazed that the minister or the government should have changed their minds. If the Trans-Canada Air Lines, under the management of the

War Appropriation-Transport

Canadian National Railways, have been successful and have been fulfilling the functions for which they were created, why should there be any change? The Canadian Pacific Air Lines is part of an organization, the Canadian Pacific Railway Company, which for years has been synonymous the world over with Canada and Canadian affairs. Have they not been giving the people the service they should be giving? Have they been exploiting the public? Have they been exploiting their employees? Is there something wrong with the service? Or is it simply that they are doing a better job than the government-owned organization and are thus threatening the government-owned system? The minister said that he did not want to have to meet ruinous competition, but in my opinion the divorcing of these lines ' from ' the railway will create competition of the worst kind in the carrying of passengers and express.

Has the minister changed his mind in relation to the legal problems? Instead of having a legal organization for each railway, he intends to have a multiplicity of legal organizations all over the country. This will probably be very good for the lawyers. Will the divorcing of the air lines from the railways facilitate the sale of tickets? The minister said in 1937 that the private interests came from every part of Canada and the United States and put on the most persistent lobby in Ottawa that he had ever seen. This will be repeated. I should like to know just why the minister has changed his mind. Perhaps a little later he will tell us. It is hard for me to find any justification for it, unless this is some more of what we call political eyewash. Is there any reason for this action on the part of the government? Is this an attempt to counter the policies of the C.C.F.? Is the government trying to go one better than the C.C.F. in the taking over of enterprises of this kind? So far as I know, the railways are running the air lines quite well. Not only that, but I think there is far more possibility of Canadian Pacific Air Lines providing positions for our boys when they return from overseas. If we are to set up a number of independent air lines, they will have doubtful success.

Is this being done because the United States have decided to divorce their air lines from their railways? I cannot help but think of the position of the feeder lines of Canadian Pacific Air Lines and realize that the shortest route to Europe and Asia is over the roof of the world. I believe one reason for this action is the fact that the Canadian Pacific Air Lines are threatening the position of Trans-Canada

Air Lines. It is doubtful whether the maintenance of a monopoly in international traffic as a continuing policy is advisable. There is no sound reason why we should continue after the war a government-owned system along international lines. The well-entrenched United States lines which cross our border are constantly reaching out for additional entry permits. As I understand it, the United States have eight entries into Canada, while we have only one into the United States. There may be some military reason for this, but I do not think we want to have any competition so far as the development of our country and our airways is concerned. Certainly we should have a quid pro quo basis with the United States so far as entry permits are concerned; that is most necessary. We have the opportunities of developing our air lines, and Canadians should be able to do so on equal terms with our cousins to the south.

Another statement made by the minister is rather alarming. Speaking on March 17 he said as reported in Hansard, page 1578:

Moreover, in thus establishing freedom of transit, countries such as Canada, which are strategically placed, will be making a very great contribution to an effective international system, particularly when, like Canada, their population is not great and the amount of traffic which they have to offer for international carriage would consequently not be large.

Our population not large, the amount of traffic we have to offer not great! That is not my understanding of Canada's position- the senior self-governing dominion, the fourth amongst the united nations from the standpoint of production of war material, the third or fourth largest trading nation in the world. Is this attitude commensurate with the fine achievement of the men and women of our armed forces, or with the assiduity and enterprise of our war workers as manifested by their magnificent accomplishments, or with the willingness of our people to make sacrifices, or with their support of our victory loans? These attributes which, more than anything else, we can read in the statute of Westminster, are the hallmarks of our nationhood. They indicate the important part that this dominion will have to play on the world stage in the days which lie ahead. Is the attitude of the minister as expressed in the words I have quoted commensurate with our untold natural resources to be developed, with our frontier opportunities to the north being more and more pushed back and opened up to us? Is not the past performance of Canadians indicative of the future possibilities of Canada? Is this attitude of the minister commensurate with our strategical position in regard to

War Appropriation-Transport

Asiatic and European civil aviation prospects over the roof of the world? It seems to me that this kind of thinking shows an inferiority complex. "A small population and not much traffic"-that is not what we should be thinking about.

Another question: is our territory to be used merely as a convenience for international traffic? I do not think we ought to take that attitude. What Canada has to do is to assert her place in the aerial world, both as to worldwide transport and as to domestic and crossfrontier position. Canada's hinterland is still open for discovery. The pioneer spirit of our people must be maintained and further developed. There should be room for both public and private ownership of air transport. If there are opportunities for international and cross-frontier transport, the government must take advantage of them as quickly as possible. If public ownership is not adequate for this purpose, it must be done privately, but the government must see to it that we do not lose out. Take as an example the Canadian Broadcasting Corporation. The Havana conference gave Canada some sixty-one channels, only forty-four of which are occupied at the present time. I do not know how many channels the United States got, but I can tell you that they have 912 stations operating, while comparatively speaking we have very few. I do not think we should nourish an inferiority complex in this connection; we must stand up for our rights.

May I point out that the board, as it is to be constituted, introduces exactly the same principle as that advocated by the Canadian Association of Broadcasters, that is, an independent board free from government control. This proposal, of course, has been rejected by the Minister of National War Services, but I think a board of this kind would be equally valuable in connection with air transport and with radio.

As regards the proposed convention, as reproduced in Hansard, page 1582, article II, section 1 reads:

Each member state recognizes that every state has complete exclusive sovereignty over the air space above its territory.

That is as it should be. But then we come to article V, section 4, which gives the duties of a regional council: .

To grant licences to operate international air services within the region; to withhold licences . . .

And so on. That, it seems to me, takes away the rights we have to sovereignty over our own air.

{Mr. Douglas G. Ross.]

In connection with the convention, if I were sure of Canada's power in representation being commensurate with her strategical importance, with the importance of her potential traffic as fourth trading nation, with her potential industrial and agricultural importance in traffic, with her importance as I have indicated before, not as having a population of 11,500,000 people, but of having 25 to 50 million in the not too far distant future, I would be more satisfied.

Can the minister tell us what the position will be? How many votes will Canada have? Who are the eight designated member states? What will be the proportionment of votes? Will Canada have one or six? Will Canada be one of the designated states?

One factor which must not be overlooked is that Canada's area is vast and the problem of policing the air will be one of much moment. It cannot be taken too lightly to see to it that innocent passage over the country is only innocent passage, and not preparation for future aggression.

Another factor: What effect will this convention have on Canada's position in the commonwealth of nations and the British empire? Will it still be possible for the commonwealth and British empire to have an air transport plan? Are there any understandings with the other empire countries- Australia, New Zealand, South Africa, Great Britain and Ireland? Are there any understandings with the self-governing colonies? For myself, I think that Canada has a strategical position in the British commonwealth of nations. Under the statute of Westminster she is a free sovereign and independent nation, and she cannot stand aloof from the world in extreme nationalism. We know that now. We know that distances have very greatly shrunk. We hear rumours of non-stop flights over distances which are far greater than merely across the Atlantic. Canada therefore must assume her responsibilities as well as her advantages in world affairs. She may well, by means of aviation, be one of the strongest forces in knitting together the commonwealth and empire as a power for good and peace in the world. She must be a strong nation in a strong commonwealth and empire, and she can be a strong nation in the formulation of commonwealth and empire policies. Her position and facilities must not be used as a mere convenience. We can use the words of the minister as reported at page 1626 of Hansard and say that Canada may make "as great a contribution as possible to the successful solution of this problem", that is, the problem of international air transport. But this is so largely wrapped up in other

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international affairs that in making the contribution to air transport she will of necessity make a contribution to peace and stability.

Canada has the opportunity of drawing together, in conjunction with our neighbour, the United States, the English-speaking peoples in their job of enforcing the rule of law and order in the world. In reestablishing the democratic way of life, Canada must have representative power equal to her geographical position, her strategic position and other future possibilities.

Topic:   WAR APPROPRIATION BILL
Subtopic:   PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY
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LPP

Fred Rose

Labour Progressive

Mr. FRED ROSE (Cartier):

I welcome the fact that the government has given and is giving some consideration to the problem of postwar aviation. I especially greet the decision of the government to implement Canada's air policy through the medium of a strong government-owned air line, both on the international field and on the main-line routes of Canada. I sincerely believe that under present conditions this approach by the government is best adapted to give the country efficient air transportation and to provide opportunities of employment for returning airmen and workers in the aircraft industry.

In his statement on air policy on March 17, the minister said that Canada's position carries with it great responsibilities and great opportunities. What are these responsibilities and opportunities? In my opinion they are as follows-and when I say in my opinion, unlike others who believe they have the last word, I realize that we are discussing something new, the most concrete discussion that we could have over something for the post-war period, and I am willing to listen to the arguments of others. I repeat therefore that in my opinion these responsibilities and opportunities are as follows:

1. We should strive for cheap, efficient air transport, both inside and outside Canada.

2. We should make the utmost use of facilities created during the war, but wherever these are not well adapted to commercial use they should be replaced.

3. We should create employment for returning air force veterans, both in the field of air transport and also in other fields.

In the interest of Canada we have the responsibility to adopt an attitude to the United States of America, the Union of Soviet Socialist Republics and Britain which will help promote the maximum cooperation in air transport development to our national advantage.

There is prevalent a tendency to overemphasize the importance of probable international air developments, at least as far as Canada is concerned. The glamour of rapid travel to far places stirs the imagination and

focuses attention on the international route*.

But a sober appraisal must come to the conclusion that economically domestic air transport will be much more important to Canada for a long time to come.

In order to get the possibilities into proper perspective, let us examine specific routes and traffic.

1. North Atlantic routes to England and Europe: For passengers and freight, both the United States of America and England will have the advantage over us.

Topic:   WAR APPROPRIATION BILL
Subtopic:   PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY
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LIB

Thomas Reid

Liberal

Mr. REID:

And Scotland too. Keep the record straight.

Topic:   WAR APPROPRIATION BILL
Subtopic:   PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY
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LPP

Fred Rose

Labour Progressive

Mr. ROSE:

You can include Scotland.

They have powerful aircraft industries, and in addition a larger volume of traffic with which to keep their overhead down. However, there will most likely be sufficient traffic to support a line to the British Isles.

2. Trans-Pacific routes to Australasia and southeast Asia: The Americans have pioneered these routes and undoubtedly will be operating them again after the war. Canada could originate little traffic to these destinations, either passenger or freight. For somewhat the same reasons as enumerated previously for the north Atlantic routes, only more so, it would be folly to expect that Canada could operate in this area without tremendous losses. Many of the American experts do not expect the Pacific routes to be profitable for years.

3. Routes to South America: Again, Canada could originate little traffic and would face the competition of well established United States lines with a large traffic pool to draw upon. It would be extremely difficult to substantiate our right to enter this field, with the possible exception of Mexico.

4. Route to West Indies: Canada could

supply a reasonable amount of passenger traffic and possibly some freight on such a route. Our trade connections with these islands and the established tourist travel to them lend some support to the need for an air service direct from Canada. If we also obtained the right to pick up passengers in the United States there is no question as to the desirability of starting such a service.

5. Trans-polar routes: These are the much-discussed short great circle routes from America to the Union of Soviet Socialist Republics, India and China. They traverse, however, a traffic desert for long distance, and this puts a premium on the maximum pay load to gross weight ratio. The long distances between inhabited places will necessitate long hops with fuel using up a substantial part of carrying capacity. This suggests the need for using equipment stripped of all non-essentials.

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Since it would be extremely difficult to provide even passable passenger facilities on the ground in the polar area, the future of these routes appears to be largely for the carriage of freight where speed is essential. Conditions somewhat less rigorous would be characteristic of the route from Canada over Greenland to the Scandinavian countries and the northern part of European Russia. To make use of Canada's geographical advantages by operating the trans-polar routes would require the active collaboration of 'the Union of Soviet Socialist Republics. It is in this field that the greatest possibilities are apparent for taking advantage of our geographical position. We should operate a specialized air freight service over these routes. We should lose no time in beginning discussion of this question with the Soviet Union.

6. Carriage of freight anywhere in north America: Canada has led the world in the development of air transportation to handle freight which must reach its destination with all possible speed, such as repair parts, or freight destined for delivery in undeveloped and relatively inaccessible areas. If we could obtam from the United States reciprocal rights for each to carry this type of traffic anywhere in the other's territory, we should have no fear of obtaining our share of the traffic offering.

In addition to our international lines we should make a real effort to benefit from our geographical position by building up service functions to sell to1 foreign lines using our bases on their international routes. Besides the obvious fueling and servicing of planes, the provision of passenger accommodations, weather reporting and radio directions, we should consider the opportunities to be found in the opening up of free port areas in Canada for air traffic analogous to the great free port areas of the world for ocean traffic. For example, if Halifax, Montreal, Winnipeg and Edmonton were to become important crossroads on international air routes, then there may be important possibilities in setting up free port areas at these centres, where goods of various nations can be interchanged and even processed without incurring the necessity of passing through customs. For all these services we would of course collect tolls from the foreign lines making use of them.

On the basis of these perspectives, what kind of international air policy is best suited to meet Canada's needs? Obviously the minister was correct in excluding from any general international agreement the question

of cross border services of contiguous countries. We need this freedom of action to try to obtain from the United States the right to operate special air freight service anywhere.

Freedom of air transit, as defined by the minister in his statement, gives away the geographical advantages which Canada possesses without getting any advantages for us in return which are of practical use. The minister himself admitted as much when he said on March 17, 1944, at page 1578 of Hansard:

Moreover, countries such as Canada, which are strategically placed, will be making a very great contribution to an effective international sj'stem, particularly when, like Canada, their population is not great, and the amount of traffic which they have to offer for international carriage would consequently not be large. On the other hand, the right of transit would be of particular benefit to those nations which have a great deal of potential traffic for international air services, but are less strategically located.

If this means anything, it means that Canada gets nothing useful in return for granting freedom of air transit, while countries like the United Kingdom and the United States do get very real benefits. Why should we give up this right so cheaply? What we should do is to grant this right in return for a very concrete quid pro quo, for example, from the United States some integration of the aircraft manufacturing industries in the two countries by which Canada may be guaranteed an outlet for certain definite types of planes which we can make here, plus the right for us to pick up and deliver in the United States traffic to and from the West Indies; from England, the benefits of cheap air mail rates to empire destinations; from the Union of Soviet Socialist Republics, reciprocal landing and freight traffic rights on trans-polar routes.

It is quite true that "our interest lies in a liberal course of cooperation with other nations," but "cooperation" does not need to be defined in such a way that it means giving away our natural advantages for nothing in return. Neither should we attempt to play dog in the manger. But it is quite within the realm of full international collaboration for us to ask for and expect to get some usable advantage, such as those just described, in return for making our airfields and services available to the air lines of other nations. As noted previously, for these services we provide we expect to receive a fair fee-not a hold-up charge, but a fair return for services rendered.

We do need, just as do the other countries, a multilateral agreement providing for such

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things as uniform safety rules and air worthiness standards, uniform plane and ground markings and signals, joint accident investigation, weather and direction reporting. It would also be desirable for the various countries to agree on uniform operating standards and exchange information. Yet there are practical limits to which such an agreement can be expected to go under existing conditions. For example it is naive to expect that an international regulatory body will eliminate subsidies. Every major country that decides to have an international air line will have one whether it requires a subsidy to do so or not. In fact, there are many ways of subsidizing air transport indirectly, and no set of rules could successfully stop the practice. Only a few weeks ago, Sir Archibald Sinclair, the British Air Minister, told1 the House of Commons that British Overseas Airways Corporation would have to be subsidized heavily. A report of this speech appears in the Wall Street Journal for March 17, 1944.

The government policy, already established, of retaining control of all main-line air operations is sound. The minister stresses the importance of encouraging returning airmen to establish bush and feeder routes wherever practicable. I agree with this. I believe our returning airmen should be given all possible help in this respect. While the total employment thus created will not likely be large, it is a field to which the returning airmen will naturally gravitate. However, if they are to be able to start up new air line operations, no matter how small, most of them will require access to capital which is not readily forthcoming from the banks for such activities. It would seem, therefore, that if the government is sincere in its desire to promote this field for returning airmen, it should change the provisions of the Industrial Development Bank bill to make it possible for this institution to grant credit to the airmen to start up in business for themselves. Unless the government takes some such action to make credit available, the creation of post-war employment in this kind of activity will remain a pious hope.

The civil aeronautics administration of the United States Department of Commerce has been planning, and civil aeronautics administration officials have been giving publicity to, extensive domestic airport and facilities developments by the government after the war. It has been strongly recommended that in the first few years after the war the number of airports in the United States should be raised to 6,000, about double the present number. It is estimated by civil

aeronautics administration officials that this will involve an expenditure of some eight hundred millions. At the present time about eighty-five per cent of airport facilities have been built with federal money, so that the planned extension of airport facilities contemplates, in effect, a gigantic public works project largely done by the federal government. This data on United States airport development was given in a speech by William A. M. Burden, special aviation assistant to -the Secretary of Commerce, before the first national clinic of domestic aviation planning, Oklahoma City, November 11, 1943.

If domestic air transportation is to develop as it should in Canada, some comparable expansion of facilities will be necessary. Many of the war-time airfields are in locations which will be of no commercial value after the war, so that despite the expansion which the minister says has taken place, it is evident that much more will have to be done to equip Canada with the requisite- facilities for a large expansion of both commercial and private flying.

For Canada, it is strongly recommended that the air-port and airway developments be done by the federal government in- order to obtain the best possible organization of facilities from the national point of view. The history of Canadian- railroad building, where different municipalities vied with each other to obtain the line through their jurisdiction, should not be repeated with the airways. Financially, none but the largest municipalities can afford to build the type of airports demanded by modern transport planes. Therefore there are both economic and financial reasons for making the provision of airway facilities a federal responsibility. In this way, too, proper standards can be enforced.

The minister's comprehensive statement to the house and the tabling of the draft international air transport convention illustrate vividly the manner in which important postwar policies for Canada are being determined behind the scenes and the country half committed to a policy before any discussion of the issues takes place in parliament. The draft international air transport convention is a document of far-reaching implications. Yet this expression, or suggestion, of policy from Canada was presented to foreign governments for discussion without any previous expression of opinion by the people of Canada or their elected representatives. In this connection we have had a conference in Montreal, and very little is known as to what happened there.

War Appropriation-Transport

The whole question of air policy, both domestic and international, is of such outstanding importance to the future of this country that it should be the subject of a complete and thorough investigation by a complete royal commission. To mention but a few of the important matters which need first a thorough presentation of the facts and then a discussion of policy based thereon:

(a) The future of the aircraft manufacturing industry: What should be done with the present excessive capacity for peace-time uses? Which plants are best adapted to continue production? What type of planes should they make? Should we produce aeroplane engines? What should be the relation of Canadian industry to its counterpart in the United States and England?

(b) The planned promotion of commercial operations in Canada: What government public works investment is necessary? Where should the additional facilities be established? How quickly can this be done? What research work should be the responsibility of the government as to safety measures, improved ground equipment and communications, new or specialized types of planes?

(c) The relations of air transport to other transport agencies: Will the best development of integrated transportation in Canada be attained by the divorce of air lines from the railroads? What changes are required in the organization and personnel of the board of transport commissioners to assure the competent regulation of all kinds of transport by this one body? Or can it be better done by a separate air body?

(d) The appropriate fields of development in international air transport: What routes can be best operated? What specialized services can we best- offer? What kinds of specialized equipment do we need to develop? What undertakings should be done jointly with other nations? What are the necessary terms of an international agreement suited to our particular needs? What service functions can we develop and what should we charge therefor in connection with the operations of foreign air lines over Canadian airways? What bilateral arrangements should we promote with the United States to assure our air lines an equitable share of the trans-border traffic? Can we develop some integrated services with both the United States and the Union of Soviet Socialist Republics instead of starting out to try to compete with both?

Until a royal commission has developed the necessary information on all such points and presented it to parliament for discussion, how can we determine an appropriate air policy for Canada? The government should give an

EMr. Rose.]

undertaking not to make any more commitments or to fly any more kites on tentative agreements until this royal commission has brought in its report and it has been discussed by parliament. Only on the basis of a thorough presentation of the facts can an air policy be developed which will effectively bring closer together not only the people of the various Canadian provinces but also the free peoples of the world.

Topic:   WAR APPROPRIATION BILL
Subtopic:   PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY
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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

Co-operative Commonwealth Federation (C.C.F.)

Mr. KNOWLES:

I spoke on this matter at some length on March 20, immediately after the minister had made his statement on the subject of post-war civil aviation. Accordingly I do not intend to make a speech at this time, but I should like to direct a number of questions to the minister. I imagine he can be forgiven for not having answered the questions asked as we have gone along, in view of the fact that most of them have come in the midst of full length speeches, but I trust he will do me the honour of answering the questions I am going to put to him at this time. With your permission, Mr. Chairman, I should like to ask the questions one or two at a time, get the minister's answers and then ask others.

In connection with the domestic policy which the minister announced on March 17, I should like to ask if the government is planning to take over the northwest staging route and operate it under T.C.A. May I ask another question which is germane to this one. The magazine Canadian Aviation recently published an article concerning this whole subject, and if my memory serves me correctly the statement was made that Trans-Canada Air Lines was endeavouring to get control of this route. It was suggested that this was unfair to Canadian Pacific Air Lines and Yukon Southern, because they had been encouraged to go ahead with their developments in that part of the country and had no prior intimation that a course such as that now proposed might be adopted at some time in the future. In view of that suggestion I should like the minister, when he deals with this subject, to indicate whether Yukon Southern received any assistance from the government in pioneering that route, in the form of mail contracts or in any other way, and also whether in the early days Yukon Southern was given any intimation to the effect that at some time in the future the whole route might come under T.C.A. That is my first question, with respect to the northwest staging route.

Topic:   WAR APPROPRIATION BILL
Subtopic:   PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY
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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

I think it has been stated in the railway committee that while Yukon Southern has an annual licence from the board

War Appropriation-Transport

of transport commissioners, it holds a contract with the Post Office Department to carry mail on the route, which contract is cancellable on one month's notice. From the time .that service was inaugurated, it has been made perfectly clear to Yukon Southern that the service was temporary, and that at some time the government would wish to operate the service by Trans-Canada Air Lines. The northwest staging route is part of an international route, and it is the policy of the government to operate international routes by Trans-Canada. Perhaps that will answer my hon. friend's questions.

Mr. ^KNOWLES: From that answer one

might infer, then, that in due course that route will come under the control of T.C.A.?

Topic:   WAR APPROPRIATION BILL
Subtopic:   PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY
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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

I would point out that two

factors are involved. One is the international traffic and the other is the local traffic. I would not like to be quoted as saying that the government would take over the local traffic on the route. As my hon. friend knows, a number of mail stations are served by Yukon Southern, and I should not like to say how these will be served in the future. I will say, however, that at some time Trans-Canada will operate over the northwest staging route, at least to the extent of operating an international route.

Topic:   WAR APPROPRIATION BILL
Subtopic:   PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY
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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

Co-operative Commonwealth Federation (C.C.F.)

Mr. KNOWLES:

I think perhaps it should be on the record at this point, at least I should like to have it there, that when we speak of Yukon Southern we are speaking of a subsidiary of Canadian Pacific Air Lines. Further in the same vein I should like to ask if any consideration is being given to taking over the route down the Mackenzie or the route to Labrador.

Topic:   WAR APPROPRIATION BILL
Subtopic:   PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY
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April 20, 1944