March 6, 1951

CCF

Major James William Coldwell

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

Mr. Coldwell:

Therefore, it should be

tabled.

Topic:   DEFENCE PRODUCTION ACT
Subtopic:   CREATION OF NEW DEPARTMENT
Sub-subtopic:   MOBILIZATION
Permalink
LIB

Stuart Sinclair Garson (Solicitor General of Canada; Minister of Justice and Attorney General of Canada)

Liberal

Mr. Garson:

If it is a regulation passed under the Emergency Powers Act, and if it is a regulation within the meaning of the Regulations Act, then it must be tabled under the provisions of the Emergency Powers Act.

Topic:   DEFENCE PRODUCTION ACT
Subtopic:   CREATION OF NEW DEPARTMENT
Sub-subtopic:   MOBILIZATION
Permalink
CCF

Major James William Coldwell

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

Mr. Coldwell:

Would this come under that provision, in your opinion?

Topic:   DEFENCE PRODUCTION ACT
Subtopic:   CREATION OF NEW DEPARTMENT
Sub-subtopic:   MOBILIZATION
Permalink
LIB

Stuart Sinclair Garson (Solicitor General of Canada; Minister of Justice and Attorney General of Canada)

Liberal

Mr. Garson:

My hon. friend is asking me an extremely hypothetical question. Because we have the Emergency Powers Act now, regulations or orders in council may be passed under that act, and then pursuant to those orders in council other things may be passed. I am afraid that I cannot oblige him with an opinion on something so remote, something that has not yet been bom, but quite probably so, yes.

Topic:   DEFENCE PRODUCTION ACT
Subtopic:   CREATION OF NEW DEPARTMENT
Sub-subtopic:   MOBILIZATION
Permalink
LIB

Clarence Decatur Howe (Minister of Trade and Commerce)

Liberal

Mr. Howe:

Just to show the difference in the feeling of urgency between the congress of the United States and this House of Commons, the first thing that was done when their defence production plan was entered into was that the combines legislation in the United States was in effect suspended in so far as it affected war industries. I believe it might very well be done here. However,

knowing the susceptibilities of the leader of the opposition, I would not think of trying it.

Topic:   DEFENCE PRODUCTION ACT
Subtopic:   CREATION OF NEW DEPARTMENT
Sub-subtopic:   MOBILIZATION
Permalink
PC

George Alexander Drew (Leader of the Official Opposition)

Progressive Conservative

Mr. Drew:

Mr. Chairman, section 28 does just precisely that, and the explanation of the Minister of Justice completely overlooked the fact that we have just been discussing the section under which any other statute can be set aside where it affects defence contracts.

Topic:   DEFENCE PRODUCTION ACT
Subtopic:   CREATION OF NEW DEPARTMENT
Sub-subtopic:   MOBILIZATION
Permalink
LIB

Stuart Sinclair Garson (Solicitor General of Canada; Minister of Justice and Attorney General of Canada)

Liberal

Mr. Garson:

May I make one observation concerning my hon. friend's remark. I do not think that, even within the limited meaning he was giving to his remarks, that is confining them to section 28, it affords the interpretation he has given. Section 28, I would point

Defence Production Act out, relates entirely to defence contracts, whereas the Emergency Powers Act established a wider application.

Section stands.

Progress reported.

BUSINESS OF THE HOUSE Mr. Fournier (Hull): Mr. Speaker, tomorrow is private members' day and we will follow the order set out in standing order 15.

Topic:   DEFENCE PRODUCTION ACT
Subtopic:   CREATION OF NEW DEPARTMENT
Sub-subtopic:   MOBILIZATION
Permalink

It being five minutes after eleven o'clock the house adjourned, without question put, pursuant to standing order.


HOUSE OF COMMONS' APPENDIX

BRITISH NORTH AMERICA ACT-SUGGESTED AMENDMENTS- CORRESPONDENCE WITH PROVINCES


Office of the Premier Alberta Edmonton, January 26, 1951 Hon. Stuart S. Garson, K.C., Minister of Justice and Attorney General of Canada, Ottawa, Canada. Dear Mr. Garson: I am in receipt of your letter of the 2nd instant enclosing proposed amendments to the British North America Act respecting old age pensions and a provincial sales tax. I have also received your further letter of the 20th instant. With reference to the amendment to section 95, it is suggested that the words "or the legislature of any province" be added after the words "the parliament of Canada" where they occur in line 2 of subsection 2 of section 95 of the proposed amendment. You will recall that the Prime Minister indicated that there would be concurrent legislation with respect to old age pensions and therefore the amendment should not be placed in section 91 of the British North America Act. In view of the wording of subsection 1 of section 95, and in order that there should be no question but that the legislatures of the provinces will have concurrent jurisdiction and will be enabled to enact legislation dealing with the age group of sixty-five to seventy and possibly to supplement the dominion old age pension at seventy, it seems to me that it is necessary to incorporate these words in the proposed amendment; otherwise the courts might construe the section as giving exclusive jurisdiction to the dominion, which I am sure you will agree was not intended. The amendment to head 2 of section 92 as submitted appears to incorporate the agreement made at the Ottawa conference, and I have no objection to the addition of the words "and not so as to discriminate between sellers or classes of sellers of the same class of goods" as proposed in your letter of the 20th instant. Yours very truly, Ernest Manning Premier Office of the Premier Province of Manitoba Winnipeg, January 31, 1951 Hon. Stuart. S. Garson, K.C., Minister of Justice, Ottawa, Ontario. Dear Mr. Garson: Your letter of January 3 enclosing drafts of two constitutional amendments to deal with old age pensions and retail sales tax, together with your letter of January 20 suggesting certain additional words to be inserted in the draft with regard to sales tax, have received careful attention in cabinet council. I am therefore writing to inform you of the conclusions which we have reached. Your suggestion is that the question of old age pensions should be dealt with by adding a new subsection to section 95 of the B.N.A. Act. You will recall that during the discussion of this subject at the conference I made the proposal that old age pensions should be dealt with as a new subsection of section 91. We would like to repeat that suggestion now. Under the proposal which is now before us, the federal government will be assuming complete responsibility for pensions to persons aged seventy and over and fifty per cent of the cost of pensions to persons aged sixty-five to sixty-nine inclusive. The result will be that the total cost to the federal treasury will be somewhat of the magnitude of $356 million while the total cost to all ten provinces will be approximately $32 million. In other words, the federal government has indicated its willingness to assume more than 90 per cent of the financial costs of old age pension schemes. Under these circumstances it seems to us fundamentally unsound that we should continue ten separate provincial administrative organizations in the field of old age pensions, each one of them overlapping with the federal jurisdiction and each one of them requiring constant exchange of information and constant co-ordination of information and administrative practices. On the grounds of eliminating unnecessary duplication of administrative machinery and of avoiding frequent misunderstandings between different governments, it is our view that one central uniform administrative machinery should be created to deal with the question of old age pensions. For this reason we would strongly urge that the proposed amendment with respect to old age pensions should simply be the addition of a new subsection in section 91 which would read "old age pensions." If, however, this proposal does not find favour with your government and with the governments of the other provinces, we are prepared to support an amendment which will authorize the federal government to deal with old age pensions while continuing the authority of the provinces to do likewise. We feel, however, that there may be certain confusions created if the proposed amendment is made a subsection of section 95. At the present time section 95 follows a heading which reads "Agriculture and Immigration." It will obviously be somewhat misleading to carry under that heading a subsection dealing with old age pensions, and it may therefore be necessary to amend the heading also or to set up the proposed amendment as a separate section rather than as a subsection of section 95. We understand that pensions for the blind are to be brought under the same arrangements as are proposed for persons seventy years of age and over. We therefore submit that the constitutional amendment in connection with old age pensions should have added to it the following: "and to pensions for the blind." We have also given consideration to the proposed amendment to section 92, head 2, which would change that head so as to read as follows: "2. The raising of revenue for provincial purposes by (a) direct taxation within the province, and (b) indirect taxation within the province in respect of the sale of goods (except goods sold for shipment outside the province) to a buyer for purposes of consumption or use and not for resale, at a rate not exceeding three per centum of the sale price, but not so as to discriminate between sales of goods grown, produced or manufactured within the province and sales of goods grown, produced or manufactured outside the province and not so as to discriminate between sellers or classes of sellers of the same class of goods." This proposed amendment deals only with the sale of goods. It would therefore presumably not apply to such things as electrical power, or services provided by laundries, theatres, hotels, restaurants, barber shops and the like. It was our understanding that this amendment should enable the province to impose this type of tax wherever it is a more convenient method of raising revenue from the people in the province who get the benefit of goods and services available in the province. It therefore seems to us that the proposed amendment should make it clear that it covers these other types of industries which provide services directly to the consuming public. Our advisers have suggested that since the proposed amendment, in prohibiting discrimination between sales of goods local to the province and those from outside the province, makes no specific mention of goods manufactured partially outside and partially inside the province, it might be possible to evade the prohibition by discriminating either against or in favour of goods partially manufactured within and partially without the province. Your government may desire to provide against any such possibility. Yours very truly, Douglas Campbell The Premier The Government of the Province of New Brunswick Fredericton, February 2, 1951 Hon. Stuart Garson, K.C., Minister of Justice, Ottawa, Canada. Dear Mr. Garson: This has further reference to your letter of January 2, with which was submitted for consideration by the government of this province two proposed amendments to the British North America Act, one respecting old age pensions, the other a provincial sales tax. We look upon these matters as quite distinct one from the other and capable of separate action. As to the first relating to old age pensions, we understand this is being sought in order to make certain that the parliament and government of Canada have authority to implement the old age pensions plan enunciated on behalf of that government at the recent federal-provincial conference on fiscal and social security matters. If the federal government is satisfied that this proposed constitutional amendment is sufficient for such purposes, we are quite willing that the act be amended accordingly. As to the second proposed amendment involving constitutional changes which would permit the provinces to impose indirect taxation by way of a sales tax, we feel that the proposal advanced will not meet the situation of the provinces, fixing as it does the maximum tax that could be levied thereunder at three per cent. In our view the main and overriding purpose of such an amendment is to be found in the advantage which would accrue to the provinces through being able to impose such indirect taxation in lieu of a purchasers' or consumers' tax such as is now found in five of the provinces. In at least two of these, including our own, the existing tax rate is in excess of three per cent. In the light of this situation we can see no advantage to be gained through a constitutional amendment which would limit or restrict a province in the manner suggested. We would strongly urge that the federal government amend its proposals to permit the imposition of a tax at a higher level; to meet our situation it should be at least four per cent. If this is done we shall be very glad to give further consideration to the form and content oi the proposed amendment. Yours sincerely, John B. McNair Premier's Office Saskatchewan Regina, February 5, 1951 Hon. Stuart Garson, K.C., Minister of Justice and Attorney General of Canada, Ottawa, Ontario. Dear Mr. Garson: The Saskatchewan government has studied the two proposed amendments to the British North America Act respecting old age pensions and a provincial sales tax contained in your letter of January 2, and also the addition of certain words to the provincial sales tax amendment contained in your letter of January 20. We are satisfied that the wording which you have suggested for the two proposed constitutional amendments will carry out the spirit and intent of the decisions arrived at during the federal-provincial conference of last December. The Saskatchewan government will submit the proposed constitutional amendments to the legislature as soon as possible with our complete endorsation and support. We feel, however, that on so vital a matter as endorsing important changes in the British North America Act the legislature should place the seal of its approval upon what is being proposed. Yours sincerely, T. C. Douglas Office of the Premier Province Of British Columbia Victoria, February 6, 1951 Hon. Stuart S. Garson, K.C., Minister of Justice, Parliament Buildings, Ottawa, Canada. My dear Mr. Garson: This is to acknowledge receipt of your letters of January 2 and January 20 with reference to the proposed amendments to the British North America Act. Please be advised that while the government concurs in the draft legislation you have submitted, it has been deemed advisable to secure legislative approval of same. Consequently a formal resolution will be presented to the legislature within two or three days of the opening of parliament. It is



my intention to bring on this motion as quickly as possible so that you may have the views of the legislature in respect thereto. With kindest personal regards. Yours faithfully, Byron I. Johnson Premier Premier's Office Saskatchewan Regina, February 10, 1951 Hon. Stuart Garson, K.C., Minister of Justice and Attorney General, Ottawa, Ontario. Dear Mr. Garson: Attached please find copy of our "Routine Proceedings" of February 8, in which you will note the resolutions which I placed on the order paper and which will probably be discussed and dealt with in the course of the next few days. I thought you would be interested in having this, lest there should be any question raised as to the position which Saskatchewan takes with reference to the two constitutional amendments which your government has suggested. Yours sincerely, T. C. Douglas Extract from Routine Proceedings and Orders of the Day of the legislative assembly, province of Saskatchewan, No. 6, Thursday, February 8, 1951. "Government Motions 1. Hon. Mr. Douglas (Weybum), to move the following resolution: That this assembly approves in principle the amendment of section 95 of the British North America Act, as proposed by the government of Canada, following the federal-provincial conference held in December 1950, under which, notwithstanding anything contained in the said act, the parliament of Canada may make laws in relation to old age pensions. 2. Hon. Mr. Douglas (Weyburn), to move the following resolution: That this assembly approves in principle the amendment of section 92 of the British North America Act as proposed by the government of Canada, following the federal-provincial conference of December 1950, under which, in addition to the power already possessed by the province, the province shall have power to raise revenue for provincial purposes by: 'Indirect taxation within the province in respect of the sale of goods (except goods sold for shipment outside the province) at a rate not exceeding three per centum of the sale price, but not so as to discriminate between sales of goods grown, produced or manufactured within the province and sales of goods grown, produced or manufactured outside the province, and not so as to discriminate between sellers or classes of sellers of the same class of goods.' ''


TEXT OF LETTER SENT TO THE PREMIERS OF ALL THE PROVINCES


Office of the Minister of Justice Ottawa, Canada, February 28, 1951 Hon. Byron I. Johnson, M.B.E., Premier of British Columbia, Parliament Buildings, Victoria, B.C. Dear Mr. Johnson: On January 2, 1951, I wrote you forwarding two enclosed proposed amendments to the British North America Act respecting old age pensions and a provincial sales tax. On January 20 I wrote another letter setting out the text of a further amendment to the sales tax amendment which had been included in my letter of January 2. In response to these letters I have now had replies from the provincial governments. In order that every provincial government will know what position every other provincial government has taken in relation to these amendments, I now enclose copies of all letters and enclosures which I have received from the provincial premiers and their colleagues in this connection which I list as follows: Letters to me from Premier Jones dated January 5, 1951; Premier McNair dated January 6, 1951; Premier Douglas dated January 8, 1951; Premier Duplessis dated January 8, 1951; Premier Macdonald dated January 19, 1951 and enclosures; Premier Frost dated January 24, 1951; Premier Jones dated January 25, 1951; Premier McNair dated January 25, 1951; Premier Manning dated January 26, 1951; Premier Smallwood dated January 26, 1951; Premier Campbell dated January 31, 1951; Premier McNair dated February 2, 1951; Premier Douglas dated February 5, 1951; Premier Johnson dated February 6, 1951; Premier Douglas dated February 10, 1951 and enclosure; Telegram from Premier Jones to myself dated January 23, 1951; Telegram from Premier Macdonald to myself dated January 31, 1951. One reason for the language in which we drafted the amendment regarding old age pensions which we sent out in my letter of January 2, 1951, was to indicate that the federal government should also have powers to pass laws relating to old age pensions in addition to the powers which the provincial legislatures have already exercised in that behalf. We therefore drafted this amendment as follows: "Notwithstanding anything in this act the parliament of Canada may make laws in relation to old age pensions". The premiers of Ontario, Nova Scotia, and Alberta raise the point that this language might perhaps be open to misinterpretation as giving the government of Canada sole jurisdiction in the field of old age pensions legislation. This was not what we intended, nor do we think that this is the effect of the language in question; but we are quite willing to try to draft a new wording which will reassure the premiers of Ontario, Nova Scotia and Alberta on the points they have raised. In an endeavour to do so I now submit a new draft of a new section 95A (not a new subsection to the section 95 itself) to read as follows: "In each province the legislature may make laws m relation to old age pensions within the province; and it is hereby declared that the parliament of Canada may from time to time make laws in relation to old age pensions in Canada, but no law made by the parliament of Canada in relation to old age pensions shall affect the operation of any law in relation to old age pensions made by a provincial legislature." A possible criticism of this new draft might be that by stating that in each province the legislatures may make laws in relation to old age pensions within the province, the draft implies incorrectly that the provincial legislatures do not nave this power at the present time. It may be argued that since there has been no suggestion in any of our negotiations that the provinces' power to pass such legislation should in any way be questioned, this provision is unnecessary since the provinces already have this power. However, even if unnecessary, it should not have any harmful implications, because it is along the same lines as section 95 with respect to agriculture in the provinces. No one could doubt that the provinces' powers to pass laws in relation to property and civil rights would have included (in the absence of section 95) the power to legislate with regard to agriculture. This provincial power was specifically mentioned in section 95 to make sure that it would not be excluded by giving jurisdiction to parliament in relation to agriculture in all or any of the provinces. Under section 95 the laws of parliament relating to agriculture were to have overriding effect. In the present old age pension amendment we wish it to be clear that the jurisdiction of the legislatures is not excluded by giving jurisdiction to parliament, and we wish it also to be clear that the laws of parliament will not affect the operation of the provincial laws. This new draft, therefore, is submitted to meet the objections raised by the governments of Ontario, Nova Scotia and Alberta. If objection be taken to this second draft on the ground that it incorrectly implied that the provinces do not have the power to make laws in relation to old age pensions within the province, then perhaps a third draft might be considered, reading as follows: "It is hereby declared that the parliament of Canada may from time to time make laws in relation to old age pensions in Canada, but no law made by the parliament of Canada in relation to old age pensions shall affect the operation of any law in relation to old age pensions within any province made by the provincial legislature of such province." With regard to Premier McNair's suggestion that the provincial sales tax authorized should be raised from three per cent to four per cent, I regret to say that after consultation with my colleagues, our original view remains unchanged that the federal government cannot agree to an increase in this rate. The suggestion made by Premier Campbell that the federal parliament should have exclusive jurisdiction over the whole field of old age pensions is concurred in neither by a number of other provincial governments nor by the federal government. Premier Campbell's suggestion that the powers of indirect taxation should be applied to such things as electrical power, or services provided by laundries, theatres, hotels, restaurants, barber shops and the like has been carefully considered. It is our view that the provinces which are imposing power and amusement taxes of this sort at the present time under their existing powers of direct taxation are not experiencing sufficient difficulty to warrant this suggested change. Moreover, inasmuch as the sales tax amendment is meeting considerable opposition from taxpaying groups, we think that it would be unwise to complicate matters further by attempting to grant new taxing powers to the provinces which could be used to impose indirect provincial taxes over the whole field of service industries, and, as it would seem, of professional services. Premier Campbell also makes the point that "[DOT] [DOT] [DOT] since the proposed amendment, in prohibiting discrimination between sales of goods local to the province and those from outside the province, makes no specific mention of goods manufactured partially outside and partially inside the province, it might be possible to evade the prohibition by discriminating either against or in favour of goods partially manufactured within and partially without the province. Your government may desire to provide against any such possibility." In relation to this point, our feeling here is that while theoretically such a case might arise, we doubt if any provincial government would think it practicable to encourage provincial production by this type of discrimination. While this is for the provinces to decide, our feeling is that for the purpose of this tax a commodity could perhaps be regarded by the provinces as manufactured in that province in which the last stage or stages in production took place. However, if there is a general feeling amongst the provinces that this point raised by Premier Campbell presents a problem which might cause serious embarrassment, we are quite prepared to consider putting into the amendment whatever may be agreed upon as an appropriate method of preventing this type of discrimination. We would be glad to have your views in reply to this letter as promptly as possible. We shall give prompt attention to the replies which we receive from all of the provincial governments in reply to this letter; and if it appears that a further attempt to co-ordinate your views which we are now seeking should be made in another draft of this constitutional amendment, we shall produce another draft. If, however, it seems impossible to reconcile some of the views expressed by the provinces and our own views, I shall endeavour to achieve such reconciliation with the disagreeing provincial premiers by long-distance telephone; and if this proves impossible, it may be necessary for us to get together again as a group to consider these matters and to continue our efforts to reach a general agreement concerning them. Yours very truly, Stuart Garson Enclosures. 994



Premier's Office Prince Edward Island Charlottetown, March 2, 1951 Hon. Stuart Carson., K.C., Minister of Justice, Ottawa, Ontario. Dear Mr. Garson: Thank you for your letter of February 28, regarding proposed constitutional amendments. The position of the government of Prince Edward Island regarding these amendments is that contained in my letters to you of January 5 and 25 last. Should, however, it become expedient to adopt one of the substituted draft amendments set forth in your letter of February 28, respecting old age pensions, Prince Edward Island would prefer the text of the third draft. Yours very truly, J. Walter Jones Premier



Wednesday, March 7, 1951 MISCELLANEOUS PRIVATE BILLS


March 6, 1951