Mr. Macdonnell (Greenwood):
Perhaps that is why they are in a mess, too.
Mr. Claxton:
Well, the hon. gentleman may say they are in a mess, but we in Canada are not in any mess due to any action of the Canadian people or the present government.
Other suggestions have been made from time to time by hon. members opposite. From one quarter of the house last year came a suggestion that we should have some kind of royal commission on public administration. Another hon. member suggested a committee of experts, and I think even this week one hon. gentleman again referred to the Hoover commission. If that sort of thing would be of any use to us we should consider it very seriously, but I wonder just how many hon. members have read the report of the task force on national security organization, appendix G, dated January, 1949, forming part of the report of the Hoover commission. It is generally known in the United States as the Eberstadt report, and has been referred to in this house two or three times. If any hon. members have read it, and know the state of our defence organization, they will find that this report contains twenty-five recommendations with respect to the national security organization. We have looked it over and my advisers tell me, and I quite agree with them, that before the report was made we already had in effect fifteen of the recommendations. Of the remainder, three were in effect in part; five
e9262-20
Defence Appropriation Act were not applicable to the Canadian constitutional set-up, and we would be definitely against one other.
So I suggest that this question of some other form of procedure, having been brought up on three occasions at the last session and having been voted down three times, should no longer detain the house, which has met here to consider the most important business, it is fair to say, it has had to deal with since the conclusion of hostilities at the end of the second world war.
I deal with these matters because hon. members have proposed them seriously, and quite properly, but I do feel that we should get on with the business of this session which, as set out in the speech from the throne, was first to deal with the labour difficulty. That has been dealt with. Then the business was to be consideration of the international situation, our defence program, and its financial and legal consequences. Several days having been devoted to those matters, I believe we should now try to get on with the defence aspect.
If I understand the views of hon. members as expressed in this debate, and indeed throughout the session, I believe there is not an hon. member who does not appreciate the tremendous, the awful seriousness of the situation. I believe virtually everyone here recognizes that we in Canada must pay more for defence, and must have more defence, as our increased share of the premium for peace. As the Prime Minister, the Leader of the Opposition, the Secretary of State for External Affairs and almost every other speaker in this debate has indicated, here we are not preparing for war; we are doing our best to prevent war by deterring aggression, and we are doing that by contributing our share to the pool of security for the countries which feel with us that freedom is worth any price.
As the resolution states, the supplementary cash appropriation to be provided for the defence forces is $142,200,200. That is what can be spent if this appropriation bill passes, in addition to what was voted last June in respect of the year 1950-51. Included in this amount are estimates of the additional expenditures due to the destroyers being in Korean waters; to the airlift to Japan organized by the R.C.A.F.; to the charter of aircraft from Canadian Pacific Air Lines, and to the raising, training, equipping and use of the Canadian Army special force. In addition it covers that part of the accelerated program which we estimate will require cash expenditures during the remainder of the fiscal year ending March 31, 1951.
It must be appreciated that it is difficult indeed to state exactly how much each of these items will amount to during the remaining months of this fiscal year. How much the navy will require will depend largely upon ammunition and fuel costs, which in turn will depend upon the extent of action the ships undertake. Similarly estimates concerning personnel depend upon the rate of intake. Expenditures for the air force depend upon the extent of flying operations; and expenditures upon equipment and construction depend upon the amount of work that can be completed in the accounting period. It is really impossible to give any proper estimate of the cost of our naval operations in Korea, the cost of the air force airlift to Japan, the renting of C.P.A. planes or the organization of the Canadian Army special force. The best estimate we can make is that those expenditures will be between $40 and $50 million and more if necessary, depending upon the extent of operations. In addition, since the statement in the house by the Prime Minister on the closing day last session we have been pushing forward delivery dates for aircraft, engines, radar, wireless and other types of equipment for which our industry has large productive capacity and a very high standard of efficiency. With respedt to construction-and we need quite a lot of new construction-there are limiting factors such as the supply of materials and manpower and the necessity of meeting essential civilian requirements for houses, power plants and other construction.
In addition to cash requirements of $142 million the bill also provides for future commitment authority in the amount of $414,567,828; and in this connection I should like to direct attention to a typographical error in the mimeographed sheets which have been distributed, in the second and third items under the future years' program having to do with the navy, where the figures have been transposed. So that instead of $4,854,125 in the second line, it should read $1,204,125; and then, instead of $50,551,000 in the third line, it should read $54,201,000. The totals, of course, are the same.
I want to emphasize the fact that we cannot spend any part of this commitment authority without the further authority of parliament. The only money that could be spent under this vote is the $142 million cash, if that is voted, and only such part of that as is spent in respect of the year 1950-51 ending on March 31, 1951. Any part that is not spent in respect of that year lapses. The commitment authority enables us to enter
into contracts for equipment and construction extending beyond the current fiscal year.
Turning to the division of this sum of $142 million, it is divided between the services in this way: navy, $29,536,130; army, $54,171,233; air force, $58,492,837.
As hon. members will recall, the amount voted in the main estimates was $425 million. Adding this to the supplementary vote mentioned here gives a total of $567 million, the amount of cash we seek the authority of parliament to spend this year.
One of the hon. members referred to some press dspatch relating to other expenditures relative to defence included in the estimates of other government departments. Some of these perhaps should be taken into account in estimating the amount of our defence expenditures, particularly if a comparison is to be made with the defence expenditures of other countries. I must say that I deprecate such comparisons if for no other reason than that it is almost impossible to make them on a fair basis; and almost certainly such comparisons will result in pressure and recrimination as between nations which should be working closely together. But if such comparisons are made, then I suggest that they should be made, as far as possible, on a fair basis having regard to all the factors. If they are made on that fair basis, the people of Canada and the nations of the world will find that we are playing our fair part.
Some of these items which are ordinarily considered as proper defence expenditures in the figures of other countries but which we have not included in the present defence expenditure estimates and appropriations are such matters as married quarters for service personnel built by Central Mortgage and Housing Corporation and paid out of vote 562, which during the current year totalled $60 million. The atomic energy development at Chalk River is of course in Canada intended primarily for civilian purposes, but I am informed that in some countries expenditures on similar piles are considered as defence expenditures. There we have spent $8 million. Then there is the expenditure of the Department of Trade and Commerce on Canadian Arsenals of $2,900,000, and on Canadian Commercial Corporation, $900,000; the Department of National Defence share of the cost of government overhead, $2,300,000; part of the expenditure of the Department of Transport on weather services, airfields, aids to navigation and the like, $26,300,000; part of the expenditure on security made by the Department of Justice, $18 million. These items which I have mentioned total about $120 million. Except for purposes of comparison 69262-204
Defence Appropriation Act with countries which include any such figures, I do not suggest that we should include them as any part of our defence expenditures. But if they are included, they indicate that our defence expenditure per capita would amount to over $50 for each man, woman and child in Canada; this expenditure would represent about thirty per cent of the total budget of the federal government and about six per cent of the estimated national income of $14 billion.
As I say, we deprecate these comparisons; but since they have been mentioned in this chamber today, I believe that comparisons should be made on a fair and equal basis, taking account not only of the actual expenditures but also of the methods of government accounting, the differences between federal and unitary states, and the different kinds of operations that countries have to conduct owing to the different nature of their transportation and communication services and the like. As I suggest, these facts would indicate that on almost any basis of comparison, with the latest information available to us, we would be spending our own proper share, whether it be calculated on the basis of the proportion of national income, national budget or per capita, as compared with our associates in the North Atlantic treaty. We would not be as high as the United States or the United Kingdom; but this vote, if passed, will certainly go a long way to narrow the gap. These figures represent what the government believes to be a fair proportion of the total income and national budget of Canada to be spent on defence at this time.
I have not mentioned here, though I have included it in that estimation, something out of another vote which is covered by this resolution, namely $300 million to be appropriated for assistance in the provision of equipment, facilities, services and the like to the North Atlantic treaty nations. That vote will be explained by the Minister of Trade and Commerce, but I am sure he would not mind my saying that there are no details yet to be given here, as was indicated today; and also, there is no clear indication of how much of that will be spent in the current fiscal year. Almost certainly it would be under $100 million. I should indicate here that that vote is intended not only to cover assistance in the way of new equipment for our allies under the North Atlantic treaty, but also training facilities. We have already provided a considerable quantity of training facilities, as reported in my earlier statement, and are considering the possibility of other training facilities. It might also cover the possible transfer to other countries of quantities of Canadian equipment that we already have in
Defence Appropriation Act mobilization stores. As I have indicated to hon. members on other occasions, we have considerable quantities of equipment of the latest type, in use at the end of the second world war, available in mobilization stores for use should it be needed in another emergency. In discussing our defence co-operation and plans with the other countries of the North Atlantic treaty nations we may decide, in the light of all circumstances, that that equipment would be more useful in our defence as well as theirs if put in the hands of countries in Europe or elsewhere than maintained in stores in Canada. That is receiving very active consideration.
Now, sir, if we take the appropriation in the main estimates of $425 million, and the supplementary of $142 million, and add them together we find that the total of $567 million is arrived at, and that is divided as between the three armed forces, excepting other votes, in the proportion of navy, $111 million; army, $184 million and air force $227 million. So that the money going to those three services alone, eliminating administration, research, pensions and so forth, gives a division to the navy of 21-3 per cent, the army 35 -3 per cent and the air force 43 [DOT] 4 per cent. I am assured that this is by all odds the largest proportion spent on the air force in any country. I believe it is in accord1 with the strategical necessities, and the way in which we can make our best contributions to our allies, and also in accord with the feeling and tradition of the Canadian people, who are certainly air-minded.
The corresponding figures of the air force's proportion of the defence dollar in the United States are 34 per cent; in the United Kingdom 29 per cent; and in France 30 per cent, as opposed to 43-4 per cent in Canada.
May I give the committee another series of divisions of the defence dollar by requirements? The sum of $142 million supplementary will be divided as follows. We estimate pay and allowances 11-15 per cent, $16-1 million; civil salaries and wages 1-8 per cent, $2-5 million; equipment, 45-8 per cent, $65-3 million; property, 18-9 per cent, $27 million; and other costs, largely pensions, 21-9 per cent, $31-2 million. Dividing the total estimate for the year ending March 31, 1951, of $567 million among these heads gives the following results: pay and allowances, 24-29 per cent, $138-3 million; civil salaries and wages, 7-40 per cent, $42-1 million; equipment, 30-28 per cent, $172-4 million; property, 14-27 per cent, $81-3 million; research, 4-25 per cent, $24-1 million; other costs, 19-51 per cent, $111 million; total, 100 per cent, $567 million.
So that hon. members may see the main divisions of defence expenditures during the post-war period I have caused a table to be prepared showing this break-down under the items given above for each of the years 194748, 1948-49, 1949-50 and 1950-51 up to the end of July. I should like to place this table on Hansard. It will be of interest to hon. members in that it shows the division of expenditures as between the navy, the army, the air force, defence research and pension grants and so forth, not only for each of these years, which are the only complete years in the post-war period; it also shows the total expended during the period up to the 31st of July 1950, which was $968,066,826. The division of this sum is 18-92 per cent for the navy; 37-61 for the army; 34-20 per cent for the air force; 5-17 per cent for defence research and 4-10 per cent for pension grants and so forth.
The Deputy Chairman:
Has the minister permission to put the table on Hansard?
Agreed.
Mr. Claxton:
The table follows:
BY SERVICES 1947-48 1948-49 1949-50 1950-51 (to 31 July 1950) Total $ % $ % $ % $ % % %R.C.N 43,719,402 22-31 44,649,774 16-61 73,399,656 19-07 21,401,616 18-08 183,170,448 18-92Army 84,421,749 43-07 101,823,251 37-88 135,729,583 35-27 42,207,293 35-65 364,191,876 37-61R.C.A.F 58,232,530 29-71 90,196,790 33-55 136,375,960 35-43 46,314,097- 39-12 331,119,377 34-20Defence Research 6,024,020 3-07 16,032,519 5-97 22,388,829 5-82 5,598,505 4-73 50,043,873 5-17Pensions, Grants, etc 3,601,500 1-84 16,102,479 5-99 16,974,980 4-41 2,862,293 2-42 39,541,252 4-10195,999,201 100-00 268,804,813 100-00 384,879,008 100-00 118,383,804 100-00 968,066,826 100-00BY REQUIREMENT Pay and Allowances 74,117,126 37-82 87,504,363 32-56 108,548,332 28-19 40,633,240 34-32 310,803,061 32-11Civil Salaries and Wages 30,155,330 15-38 34,097,490 12-68 40,114,285 10-43 12,542,656 10-59 116,909,761 12-0827,434,844 14-00 35,863,915 13-34 74,404,697 19-33 26,644,045 22-51 164,347,501 16-9821,862,968 11-16 42,150,027 15-68 62,665,301 16-28 12,723,923 10-75 139,402,219 14-40Research 6,024,020 3-07 16,032,519 5-96 22,388,829 5-83 5,598,505 4-73 50,043,873 5-17All Other Costs- Food, Clothing, Personal Equip- 7-85 9,302,787 7-86 61,147,841 6-32ment, etc 8,567,828 4-37 13,062,627 4-86 30,214,599 Travel, Transportation, Freight 3-72 4,020,277 3-40 38,633,525 3-99and Express 8,709,077 4-44 11,578,591 4-31 14,325,580 Fuel for ships aircraft, M.T., etc... 4,438,947 2-26 7,652,293 2-85 8,702,602 2-26 1,956,044 1-65 22,749,886 2-36Government contribution to Permanent Forces Pension Fund and Payments under Parts I to IV 1,637,424 1-39 37,041,332 3-82Militia Pension Act 7,722,306 3-94 13,623,782 5-07 14,057 820 3-65 Miscellaneous and other Votes 6,966,755 3-46 7,239,206 2-69 9,456,963 2-46 3,324,903 2-80 26,987,827 2-77195,999,201 100-00 268,804,813 100-00 384,879,008 100-00 118,383,904 100-00 968,066,826 100-00 Cn
Defence Appropriation Act 302 HOUSE OF Defence Appropriation Act When we come to the division as between requirements we see here the figures broken down as between pay and allowances, civil salaries and wages, equipment, property, research, food, clothing, personal equipment and so forth; travel, transportation, freight and express, fuel for ships, aircraft, pensions and other votes. It is interesting to call to the attention of hon. members that over this period we have spent about 54 per cent on personnel, that is on all the pay, allowances, pensions, food, clothing and other expenses that correspond to the labour costs in a commercial undertaking. I have compared these figures with those being expended in the United States, the United Kingdom, France and other countries and find that it is a pretty good-average. We are spending considerably less on personnel and more on equipment than are a good many countries, and we believe that that has been the right course to follow; that we should do everything possible to build up the equipment side. There is quite a considerable amount for properties, which I am sure hon. members would like a further explanation of. For the 3J years it totals $139,402,219, and represents 14.40 per cent of the total expenses. This item of $139,402,219 is further broken down by the acquisition, construction and purchase of properties, $72,510,470; maintenance and repairs, $32,027,535; operating expenses, $32,866,242; rental of buildings, and so forth, $1,997,952. Hon. members may ask why the large expenditure on properties? I can give the committee a further break-down which indicates at once that some $29 million has been spent on married quarters, a part of which
expenditure is due to the expansion of the armed forces of Canada since the beginning of the second world war and also to the character of the Canadian climate. We cannot have our troops serving without shelter during the winter, and a lot of the wartime construction was built to have a life expectancy far less than it has had up to the present time. So that a very considerable proportion of the wartime accommodation has had to be used and maintained, or rebuilt. Others have been disposed of. In answer to the hon. member for Royal, ever since the end of the war this question of properties, and their disposal, has been under continuous examination. We tried to get rid of every property we did not feel we would need in the event of mobilization, just as soon as we could. We tried to get rid of any stores that were not necessary in a mobilization, as soon as we could. I think in that respect the work done by my predecessors, and particularly the Minister of Trade and Commerce, has certainly earned a dividend for the Canadian people. We were left with just as little as possible of what could not be used, and what we needed was left in a usable condition. Since then we have maintained it fairly and properly. Were that not the case we would have had to spend very much more on properties for the accommodation of our increased forces. Perhaps hon. members would be interested in having this break-down of property expenditures for the armed services placed on Hansard. If it is their wish I shall be prepared to do so.
Agreed.
Mr. Claxton:
The table is as follows:
- 1947A8 1948-49 1949-50 1950-51 July 31/50 TotalAcquisition, Construction and Purchase of Properties $ 7,216,008 $ 23,295,663 $ 36,215,118 $ 5,783,681 $ 72,510,470Maintenance and Repairs 5,574,493 7,880,396 14,618,078 3,954,588 32,027,555Operating expenses 8,562,297 10,356,604 11,178,940 2,768,401 32,866,242Rental of buildings etc 510,170 617,364 653,165 217,253 1,997,95221,862,968 42,150,027 162,665,301 12,732,923 139,402,219 It will be noted that the first item is one of $72,510,470 for the acquisition, construction and purchase of properties. Of this amount, $29 million has been spent by this department, in addition to that spent by the Central Mortgage and Housing Corporation, on the provision of married quarters. I found when I came to this office at the end of 1946, and early in 1947, that unless we provided married quarters for the married personnel, offering the amenities of a good community life, we would not have any regular force left. For that reason the program was accelerated to the point where we have either built or have under construction on an approved program for this year more than 10,000 married quarters. Out of the same amount of $72,510,470 we have provided new construction for a number of different establishments such as at the Bedford Basin ammunition dump, the Halifax permanent barracks, British admiralty properties in Newfoundland at $7 million, and aerodrome developments at Rivers, Summer-side, Centralia and Trenton extending to a figure well over $5 million. I hope what I have given will help to answer the question of the hon. member for Royal with respect to construction. I should like now to relate that, if I may, to the manpower situation, which has a very definite bearing on construction. While that information is being got for me may I add a word about the equipment program, and what is involved in that program both by way of construction and dollars, and to show how much more it costs to equip forces today than it did in 1939 or during world war II. I do not think hon. members yet appreciate the very heavy cost of modern military equipment. For instance it was recently announced by me that we had made arrangements under which we would make at Sorel Industries Limited a number of 3-inch 50 calibre gun mountings, complete with fire control and radar for use in destroyers and anti-submarine vessels. The estimated cost of each of those guns is $400,000. The equivalent naval gun in world war II, 4-inch, mark 19, twin-gun mounting, complete with fire control, was $170,000. The new gun however is more effective as an anti-aircraft as well as a surface weapon, and is considered essential. Then, with regard to torpedoes, in world war II the cost of a 21-inch, mark 19 torpedo was $15,000, whereas the cost of a modern homing torpedo is $100,000. With regard to destroyers, the cost of a tribal class destroyer built in Canada at the end of the second world war was $8,200,000 and, with armament and stores additional, $9,700,000. Today the cost of an equivalent vessel is certainly 25 per cent higher.
Mr. Brooks:
What would the cost be if built in England?
Mr. Claxion:
That is a question which could be answered by my colleague, the Minister of Trade and Commerce, who handles that sort of thing. However, if deliveries could be obtained I think it is fair to say the cost would be less.
Defence Appropriation Act
Mr. Brooks:
Fifty per cent.
Mr. Claxion:
Not 50 per cent, no.
Mr. Howe:
The British cost would be about 70 per cent of our cost.
Mr. Claxion:
Further, it might be very difficult now to get delivery; and also, of course, we want to do all we can to build up and to maintain a shipbuilding industry in Canada.
I have here figures supplied by the Royal Canadian Air Force showing comparative costs of major requirements between the end of 1945 and the present time. In 1945 an elementary training aircraft, such as the Tiger Moth,' cost about $7,000, whereas today the Chipmunk doing an equivalent job is $12,000. The service training aircraft, the Harvard, formerly cost $41,000 and today costs $60,000. Fighter aircraft have changed of course from piston to jet. They formerly cost $90,000 whereas today they are about $450,000. Four-engine transport aircraft cost in 1945 about $600,000, and today they cost $1 million or more, and usually it is well over that amount.
Then, engines for fighter aircraft have changed from piston to jet, and the price has increased from about $8,000 to the jet engine price of today of about $65,000.
One could give similar information in connection with almost every type of equipment. For instance, let us consider the rifle. The average price during world war II was $37, whereas today it is $54. Formerly -303 rounds could be secured at $50 per thousand, while today they cost $75 for the same amount. A field gun which in world war II cost $18,200 now costs $37,000 and a three-ton truck the former price of which was $2,350 is now priced at $4,500. A tank of the Ram type could be secured at an average cost of $61,836 during world war II whereas a medium tank today costs over $200,000. So hon. members will see that a very considerable portion of the increased expenditures on defence can be traced to the increased cost of equipment.
I have mentioned construction costs and the necessity for maintaining and erecting buildings to accommodate increased numbers. However, by far the largest single item to account for this increase is the increase in strength of the active forces. The strength of the active forces as at 1939, 1947 and August 31, 1950, was as follows, and it will
Defence Appropriation Act be noted that the figure with regard to the special force applies only this year. Here are the figures:
August 31,
1939 1947 1950
(Estimated)
Royal Canadian Navy .. 1,585 7,193 9,332Canadian army (active) Canadian army (special 4,169 15,563 21,809force) 8,389Royal Canadian Air Force 2,191 12,626 17,5497,945 35,382 57,079Hon. members will see that as between
1947 and March 31, 1950, the strength of the active forces has increased from 35,382 to 57,079, an increase of over 66 per cent. We have increased by over 66 per cent the strength of the active forces and at the same time have increased the effective strength of the reserve forces by even more.
I have endeavoured to give as many facts and figures as I could to hon. members and perhaps it would be convenient for them to have another table showing the consolidation of the main and supplementary estimates for this year with the figures for the commitment period and for future years. I shall place this on Hansard if it is agreeable to the committee.
Agreed.