June 24, 1954

CCF

Clarence Gillis

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

Mr. Gillis:

I did not use the term. I never used the word at all because there are too many people who do not understand it and it has too many bad connotations. The minister will recall what was done during the

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Supply-Mines and Technical Surveys war. It is peculiar that we can work so effectively in a crisis. One of the first things that was done was that the coal industry was made a national industry. People were put in to handle it who had authority; wages went up; standards were raised and we got vacations with pay for the first time in the history of the industry. Everything went along fine. As soon as the war was over the machinery was unscrambled. I should like to see you take authority for the whole fuel industry across this country as you did during the war. If a war broke out now you would do it overnight; you would have to do it in order to avoid a lot of overlapping, extra costs, competition and mix-up in the fuel industry-

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LIB

George Prudham (Minister of Mines and Technical Surveys)

Liberal

Mr. Prudham:

Perhaps shut off the oil into Nova Scotia?

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CCF

Clarence Gillis

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

Mr. Giilis:

What was that? No, I do not say cut it off at all. The minister cannot say that because he does not know any more about it than most people who talk about it. We are all feeling our way, but we are honestly trying to get rid of a bad mess. The minister knows this very well. The mess the coal industry is in today is due to the fact that you have been working on the same mechanics for the last 75 or 80 years. It has always been in trouble; this is not the first time. As far back as I can remember it has been in trouble because of faulty mechanics. And it always will be in trouble the way it is today.

Then so far as that business of nationalization is concerned, I seem to have more confidence in the federal government than most of the ministers have because I am quite prepared to hand over the organization and direction of the fuel industry of this country to the federal government, as the elected representatives of the people of Canada. I would rather take a chance on the attitude of the minister of the government, to whom I can talk in the House of Commons, than take a chance on some president of a board of directors living down on mount Royal in Montreal, whom I never have a chance to talk to. If the minister wants to call that nationalization, all right. The only thing is that I am a little bit sorry he is afraid of himself.

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An hon. Member:

Ten o'clock.

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SC

Ernest George Hansell

Social Credit

Mr. Hansell:

I am prepared to go on, if the

committee agrees. Perhaps after I have concluded my remarks the item might pass- I do not know.

The hon. member for Cape Breton South is a very good friend of mine. In our speeches on coal we always seem to be able to hit it off pretty well. He, of course, has

some practical knowledge. My knowledge is gained from studies I have been able to make, and conferences I have been able to have with those in the coal mining industry. But I will say this, that while the hon. member is a very good friend of mine I do not think he answered the minister's question with respect to nationalization.

We listened this evening to what has come to be known as the minister's policy speech, upon the introduction of the departmental estimates. I should like to make only one or two comments on what he said. He mentioned the fact that the government had been interested in the coal mining industry for the last 28 years, and lauded the work of the coal board, and in that I agree with him. Perhaps the coal board has not had all the authority it may have desired, but so far as the responsibilities placed upon it are concerned I do not think anyone would criticize that board.

The minister mentioned subventions. I am quite willing to give the government all the credit necessary for the introduction of its subventions policy. Because I am quite certain that the coal mining industry of Canada, particularly that of western Canada, would have folded up many years ago had it not been for the subventions paid on the movement of coal. I will give the government all credit for that.

Nevertheless I do maintain, and have maintained over the years, that the government has never really had an adequate national coal policy. The minister was quite apologetic in his speech when he referred to the present situation in the coal mining industry of Canada. He made special mention of the problem in the Crowsnest pass where recently a very substantial coal mine was closed down. He said that these mines in the Crowsnest pass will have a reasonable chance, but in the very next breath he pointed out to us that one of the largest coal mines in the Crowsnest pass area, the International Coal and Coke Company, had closed down. How they can have a reasonable chance when at the same time they are closing down, I do not know.

To my mind the minister's speech painted a rather gloomy picture. He did say he was hopeful, and it is a good thing to be hopeful. But we also hear it said that hope deferred maketh the heart sick. While he said he was hopeful, he said also that the coal mining industry is fighting for its life. That is the expression he used, that it is fighting for its life. And then he proceeded to say, "But I am confident". Now it is a very nice thing to be hopeful, and it is also a nice thing to be confident. When I go back to my constituency and have to meet the coal miners

and the coal mine operators-those who are operating mines about to fold up-I will have to tell them, "Well, the minister has confidence." I am afraid the coal miners are apt to turn to me and say, "That is all right, Hansell, but confidence does not put any pork chops on our tables, nor does it buy the baby any shoes. You can't run the coal mining industry on hope and confidence."

Of course the picture is not all one-sided. While the minister painted a gloomy picture, he said he was facing the facts. The situation is becoming desperate. Some months ago I received telegrams from various parts of my constituency in the Crowsnest pass calling my attention to the fact that these mines were closing down. I have one resolution here from a meeting held at Natal in British Columbia, also in the Crowsnest pass. This community is not in my constituency, but is bordering it. I am sure other hon. members may have received a similar resolution. It was passed at a meeting attended by residents of the Crowsnest pass area in Alberta and British Columbia, and reads as follows:

Resolved that we press upon both the provincial and federal governments to implement a Canadian policy which will enable Canadian coal to supply the Canadian market, which will bring the establishment of the industries to process coal for its by-products: which will increase unemployment insurance benefits and make them continuous until steady work is available; which will recognize that the welfare of the mines and the mining industry is a government responsibility, and it is their duty to provide either work or full maintenance.

The other telegram comes from a public meeting held in the town of Blairmore. I have another telegram from a member of the local legislature. I shall not read these, but they show the seriousness of the situation, because these were sent pursuant to the announcement that these coal mines were closing down. I brought the matter up in the house at that time and, if I may, I shall read the minister's answer. I asked my question when the orders of the day were called on March 24. My question was as follows:

Has the government any knowledge of the report appearing in the Calgary Albertan that the coal mines in Coleman, Alberta, are to close down operations on March 31, and that other mines in the Crowsnest pass are likely to follow with shutdowns? If so, does the government contemplate any remedial action?

And I want hon. members to take note of the answer the minister gave. It is quite lengthy, but the part I wish to call to the attention of the committee is this:-

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LIB

George Prudham (Minister of Mines and Technical Surveys)

Liberal

Mr. Prudham:

Read it all.

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SC

Ernest George Hansell

Social Credit

Mr. Hansell:

All right, I shall, but I did not want to take the time.

Mr. Speaker, I have not seen the report to which tny hon. friend refers. I am sure all hon. members

Supply-Mines and Technical Surveys know that the coal industry in both eastern and western Canada is experiencing difficulty at the present time. In western Canada the industry's difficulties have been brought about largely through competition from oil and gas. I need not remind hon. members that the natural resources belong to the provinces. The province of Alberta has prospered enormously from the sale of natural gas and oil rights; only recently I saw a report of one sale amounting to over $30 million for two comparatively small areas of land.

This is the part that I was going to quote, without the other, for the sake of brevity:

The province of Alberta is prospering from these recent developments. The coal industry is suffering from these developments. What I would like to know is, what is the Alberta government going to do about it?

I do not like to be mean in my expressions, but I am going to tell the minister that I regard that as nothing but a cheap political answer. What has the Alberta government done about it? In his speech tonight the minister had something to say about what the Alberta government had been doing in respect to the coal mining industry there. Perhaps I can read a passage from Premier Manning's budget speech of a few months ago. This budget speech was given on March 5. I asked the minister the question on March 24. As I say, the budget speech was delivered on March 5; therefore the minister should have known what the Alberta government had been doing about it. On page 10 of Mr. Manning's budget speech, published by the queen's printer, we find the following:

Alberta's important coal industry has, in recent years, suffered from loss of markets to competitive fuels. Replacement of railway locomotives by diesel units and the conversion of coal burning locomotives to oil burners has greatly reduced what formerly was a substantial market for bituminous coal. Oil and gas progressively have eliminated coal from local domestic and industrial markets, while excessive transportation costs have made the capture and retention of eastern Canadian markets extremely difficult. Production in 1953 totalled 5,917,423 tons, a decrease of 1,277,049 tons from the previous year.

The government has assured the industry of its full co-operation in a renewed effort to increase the sale of Alberta coal in eastern markets and in this endeavour the government of the province of Ontario and the Department of Mines and Technical Surveys of the government of Canada have indicated active support. The government is convinced that a long-range solution to the problems facing our coal mining industry must be sought in fields other than the utilization of coal in its natural state. With this in mind, the legislature at this session will be asked to approve a substantial appropriation to provide a research laboratory for the^ Alberta research council with special pilot plant facilities for coal research. The government of Canada has agreed to assist in staffing this research laboratory with qualified personnel to carry out this important program from which it is hoped beneficial results will be obtained.

The minister knew that when he asked what the Alberta government was doing. That is why I say it was a cheap political

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Supply-Mines and Technical Surveys answer. I am quite sure the minister will not deny that the Alberta government have co-operated in every way possible with his own department in order to bring about a better day for the coal mining industry. I never heard Mr. Manning or anyone in the Alberta government criticize the minister's department. I believe there is the best of co-operation between the two departments. Why? Because they both have something to gain, the country has something to gain, and I am not going to say that the minister's department is not anxious to care for the welfare of the country or of the coal mining industry or whatever comes under that department. The fact is I do not think they know where they are going in respect to a national coal policy.

The situation is serious, Mr. Chairman. Might I say this: Not only has the Alberta government done that, they have done something further, and this is something the minister did not mention in his speech tonight. At the recent legislative session the Alberta government appropriated $100,000 for the rehabilitation of unemployed coal miners so that they could be taken somewhere else and be re-established. That is a magnanimous thing because the situation is serious, without very much hope for the future. Therefore it is a matter of what are these men going to do? They have built their homes there; they have raised their families there; they have worked in the mines all their lives; they are competent coal miners. As the hon. member for Cape Breton South said, it takes a lifetime to develop a coal miner, and when they grow older or are thrown out of work there is nothing much else they can do. They have to be put somewhere or rehabilitated, and encouraged to establish some place else if possible. The Alberta government recognized that and appropriated $100,000 for the purpose. When I was home a few weeks ago one of the ministers of the Alberta government was down in the Crowsnest pass looking over the situation and taking applications. In one day they had about 300 applications. That is what the Alberta government is doing, Mr. Chairman, if the minister wants to know. It is not the first time of course that the coal mining industry has had to face a serious situation.

We in this group have brought these things to the attention of the government many times. For the last two years, year in and year out, the hon. member for Red Deer has urged the government to take further steps to make something of this coal mining industry by bringing into existence a real coal policy. The hon. member for Bow River has the Drumheller coal mining industry in

his constituency. I referred to the hon. member for Red Deer. He has the coal mining industry in the community of Nordegg, and I have a coal mining industry in the Crowsnest pass. The hon. member for Lethbridge has a coal mining industry there.

We are interested in this because in Alberta there are countless millions and millions of tons of coal in those hills. I said it was serious, Mr. Chairman, and it is. I hold in my hand a clipping from the Calgary Herald that the hon. member for Red Deer handed to me. It indicates something of the seriousness of the situation. It appeared in the Calgary Herald on March 1, 1954. I will not read the whole article. It states that statistics show that the coal production in Alberta alone-these are not national figures -dropped 1,277,049 tons in 1953. The output in 1952 was 7,194,472 tons; in 1953 it was 5,917,423 tons. The highest production in Alberta was in 1946 when it ran to about 9 million tons. At that time 200 mines were operating. Now there are just 150 mines. In 1946, 9,153 people were employed in those mines; now the employment is less than

7,000 and since this was written several mines have closed down. Another article appeared in the Calgary Herald of May 26, 1954 and it states according to a Canadian Press dispatch:

Supplies of coal available for consumption In Canada reached a 13-year-old low total of 38,163,000 tons In 1953.

These are the figures for the Dominion of Canada now.

The bureau of statistics announced today in a preliminary report that the total was 8 per cent lower than the 41,620,000 tons available in 1952.

In other words, an 8 per cent drop.

Domestic production of coal fell to 15,896,000 tons in 1953 from 17,579,000 tons the year before.

Here is a drop in one year of nearly two million tons. I say the situation in the coal mining industry in Canada, not only in Alberta, is serious. This department of government must have some responsibility. Otherwise this part of the minister's department would not exist. They must recognize some responsibility otherwise they would not have a coal board. But what have they done? What are they doing?

I said a little while ago that we should compliment them on their subvention policy throughout the years, but in reality if you look at it that is not something that the coal board or the minister's own department necessarily worked out. This is a financial arrangement, and all they had to do was simply to go to the Minister of Finance or the treasury board and say, "We can do this

if we can subvent the railways for the movement of coal. Have you got the money?" And when the treasury board answers, "yes, we will pay that sum of money," then that part is taken care of. It is a solution from a financial angle rather than a solution with respect to a coal policy.

But I wish to say that there is no question in my mind that the government have failed in some of their announced objectives. I have here a copy of Hansard for May 13, 1953 and at page 5284 the minister is reported as saying in answer to a question put to him from this corner of the house:

The dominion coal board was created by legislation and brought into being by proclamation on October 21, 1947. The board at an early stage in its deliberations adopted, with the concurrence of the minister, a series of principles that in effect may be recognized as a coal policy. These principles are:

Now let me read them, they are five in number. This is the minister's statement as he continued:

(1) The maintenance of an adequate supply of coal for our national requirements;

(2) The support of a sound and healthy coal producing industry in Canada;

(3) The development of steady and adequate markets for the output from Canadian mines;

(4) The provision at fair wages of reasonably full employment for Canadian miners;

(5) The possible extensions of the market for Canadian coals, with the resultant savings of foreign exchange.

Now, let us see how far they have succeeded in that coal policy:

(1) The maintenance of an adequate supply of coal for our national requirements;

Well, we will say that they have succeeded in that. I do not know that the credit necessarily goes to the government. The coal mining industry is able to supply our national requirements, but we will give credit to the government for success No. 1.

(2) The support of a sound and healthy coal producing industry in Canada;

They have failed, the industry is not healthy.

(3) The development of steady and adequate markets for the output from Canadian mines;

The verdict: failed.

(4) The provision at fair wages of reasonably full employment for Canadian miners;

Verdict: failed.

(5) The possible extensions of the market for Canadian coals, with the resultant savings of foreign exchange.

What verdict shall we write on the tombstone? Failed! There you have it.

Now, then, Mr. Chairman, that is not all. The thing is becoming a bit of a joke. That was what the minister said on May 13, 1953.

Supply-Mines and Technical Surveys But almost a year after that, as late as February, 1954, the minister comes out and says the same thing, knowing that four parts of his declaration of policy had been a failure.

I have here the report of an interview the minister gave. The clipping does not say to whom he gave that interview, but the minister will know. Here is a report from the Montreal Gazette dated February 19, 1954. It is a Canadian Press dispatch. The heading is "Canada Needs All Her Fuel- Prudham". The article states:

Canada should not neglect any of her sources of fuel-she will need them all, mines minister Prudham said today.

I will not read all of this article but this is the thought I wish to emphasize:

On coal policy, the minister said the government favours: maintenance of an adequate coal supply for Canada's national requirements.

What he said a year ago.

A sound and healthy coal industry;

What he said a year ago.

-finding of steady markets for Canadian coal;

Just what he said a year ago.

-reasonably full employment and fair wages for miners and possible development of new equipment and methods which would lower production and transportation costs.

He said it all a year ago and yet he continued to say it then, even though he knew as late as February, 1954, that the coal mining industry of the Crowsnest pass and other parts of Canada was about to fold up. It seems to me such an accurate repetition that the minister must simply have recited it. Whether he knew he was reciting I do not know. Perhaps he was like me when I was a boy at school and I used to labour through these literary gems-

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An hon. Member:

You have not changed much.

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SC

Ernest George Hansell

Social Credit

Mr. Hansell:

Perhaps I have not, but I think I have come a long way since those days. We used to study in our class in literature a book called "The Lays of Ancient Rome". But what did I want to know about the "Lays of Ancient Rome?" I was more interested in the "Lays" of the old pasture across the road from my front gate. Yet I laboured and memorized and I would stand up and quote passage after passage. I did not know what it was all about. I did not know anything about the "Lays of Ancient Rome" and 1 was not concerned about them. But here the minister repeats five things and turns around a year later, gives an interview, and repeats the same thing knowing full well, of course, that in at least four parts of his declaration he has failed.

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I have a report from the Financial Times for February 19, and it is really the same report as the other, but it elaborates a little bit. It states the same sort of thing:

Canada must conserve its "energy supply" declared Hon. George Prudham, minister of mines.

I do not think I need to detain the committee much longer. How can the minister say these things when the evidence is to the contrary? I have another dispatch here. I must have dropped that piece of paper. Maybe it is a good thing that I did so. In any event,

I have my notes here. The bureau of statistics not long ago said-oh yes. Here it is. This was the clipping I read-that this 13-year-old low fell by about 2 million tons. That is from the dominion bureau of statistics. It was not the hon. member for Red Deer who said it. It was not the member for Bow River who said it. The hon. member for Cape Breton South said it was not he who said it. It was not the hon. member for Digby-Annapolis-Kings who said it, nor was it the hon. member for Lethbridge or the hon. member for Macleod. Those are the figures issued by the dominion bureau of statistics. We pay $5 million a year for them to hunt out the statistics for us. Now on the heels of those statistics, the minister comes along and declares this as Canada's policy. It is a policy as to which four points have failed and the other one is successful by reason of the fact that the coal mining industry is doing what it can.

I am not going to detain the committee any longer but I will say this. The minister's appraisal tonight was an honest report. As gloomy as it was, he faced the facts. I think it is well that we should face the facts. If we cannot arrive at a national policy so that the coal mining industry may be established as it should be established-if we are not going to do that-let us tell them so. That is the proper thing to do. I believe that the minister in his speech has just done that tonight.

If we have to move forward to a more progressive age where we are now substituting other fuels, then let us tell the coal mining industry that and let us tell these coal miners that. Let us tell the coal miners, "These are the facts. We may as well tell you that. We will appropriate a little bit of money to see you re-established somewhere else". That is the best thing we can do.

I do not blame the minister for his speech. He has faced the facts. As far as facing the facts is concerned, I am with him and wish him luck in his extremely difficult task. I realize that that is a difficult task. It is difficult by reason of the fact that we are living in an age of progress. Nevertheless the coal is there and the day may come when we may

need it. But in the meantime, if we have to move forward and keep abreast of progress, then let us move forward; but let us tell the coal mining industry and the coal miners the actual facts.

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LIB

William Ashbury Buchanan

Liberal

Mr. Buchanan:

Mr. Chairman, the subject now before the committee, namely, the dominion coal board estimates, is one which is of great interest and importance to the people of my constituency. In my riding we have several large coal-producing collieries; in fact, the coal industry is the base of the economy, not only in my riding but in the whole of Nova Scotia. That is the reason I am going to make a few observations at this time. As the hour is late, I will be brief.

To give you some idea of the importance of the coal industry in Nova Scotia, I should like to point out that salaries and wages paid to coal miners in Nova Scotia in 1952 amounted to $35,709,646. The steel industry at Sydney and Trenton is dependent upon maritime coal, and salaries and wages paid by this industry in Nova Scotia in 1952 amounted to $36,970,000. The transportation of the coal and steel products from the mines and steel works is a third large item in the maritime economy which is dependent upon coal.

The very existence of North Sydney, Sydney Mines, Sydney, New Waterford, Glace Bay, Stellarton, New Glasgow, Westville and Springhill, and many other small towns, depends largely upon the continuous production and use of coal. There are about 120,000 people living and working in these towns and the business connections, the requirements for food and merchandise of all kinds spread out through all Nova Scotia. Without this firm base, the economy of Nova Scotia would be in a very bad and perilous condition.

I think, Mr. Chairman, these facts clearly show the value of coal in the economy of the province by the sea and, in fact, to the whole of the maritimes. The situation is one that requires careful analysis so that this industry may be permitted to make its proper contribution to the economy of Canada.

I am sure everyone in this house realizes that the difficulties of eastern and western Canada arise largely from our geographical position. The fathers of confederation recognized this when confederation was brought about. They, in their wisdom, deliberately turned their backs upon a cheap or low-level economic life for Canada and accepted the handicaps of our national geography by planning for an economic life artificially maintained at that level required by our various interests, and not dependent upon

the American trade. We all know that we in Canada pay more tor our automobiles, our machinery, our textiles and a host of other articles because the fathers of confederation deliberately set out to build a nation.

Today our costs are higher than those of our neighbours because of duties, freight rates, and other handicaps and similar causes that were accepted as part of the price of nationhood. These costs can be substantially reduced by eliminating tariffs, buying in the cheaper American market and by this means committing suicide as a Canadian nation. I think I am quite safe in saying that there are very few among us who are willing to exchange our nationhood for the purpose of solving any of our regional problems.

In their deliberations the fathers of confederation and succeeding governments recognized that the coal industry of the maritime provinces should receive the same help and safeguards as the manufacturing industries of the central provinces. This help has been extended in many ways since the first examination of the situation by a select committee of the House of Commons in 1877., when it was proposed that a duty be imposed on United States coal.

The duties have fluctuated and today the only remaining duty is one of 50 cents per ton on bituminous coal imported from the United States. Drawbacks of this duty are allowed on a very large tonnage and the effect of the duty is offset to some degree by the present favourable exchange on the United States dollar. Added to these difficulties is a new and serious competitor to the coal industry of the maritimes in the form of cheap imported heavy fuel oil and the recent development of natural gas. Heavy fuel oil is produced in foreign refineries and is being dumped at the present time upon the world market at whatever price it will bring.

The congress of the United States has been petitioned to impose a heavy duty upon this oil and it has been reported that by mutual agreement between producers and importers the importation of this oil into the Atlantic seaboard of the United States is being restricted. There is a duty of one-third of a cent per gallon on oil entering Canada, which is roughly equal in fuel value to about 50 cents per ton of coal. Our maritime coal industry is practically wide open to this competition.

There is also a substantial production of heavy fuel oil by oil refineries in the maritime provinces from crude oil imported by sea from foreign countries free of any duty.

24, 1954 6695

Supply-Mines and Technical Surveys I am sure you will agree with me that the coal industry of the maritime provinces, facing the kind of competition that I have indicated, is labouring under great disadvantages, disadvantages that only action by the federal government, in co-operation with the provinces, can solve. Perhaps the suggestion made by the hon. member for Cape Breton South that all Canadian fuels be brought under a competent body would focus attention on the best method to use our fuels in the interests of Canada.

The federal government has helped. In fact, without the help of the government the industry would not have survived. Successive governments have for many years provided assistance to the coal industry by means of subventions. These subventions have been particularly important to the maritime provinces and have enabled the Nova Scotia industry to market some two to three million tons of coal in the Quebec and Ontario markets each year. This has been of benefit to Nova Scotia by providing a market for the extra output, and by maintaining a high and fairly constant level of production has held down costs. It has been of benefit to the central provinces by enabling the maritimes to purchase that much more of the manufactured goods of Ontario and Quebec. It has been of benefit to the nation by providing an additional tie of common interests between the central and the seaboard provinces.

The coal mines are having a very difficult time these days for various reasons. There is no need for me to enumerate these reasons at this time. I am sure that the government is fully aware of them and is helping to find a solution in so far as the federal government has the authority to do so.

The subject, Mr. Chairman, is a technical one and it is involved. I make no pretence at being an expert. I am not, like the hon. member for Cape Breton South, a miner, but I have grown up among miners. I have worked with them and I have worked for them. I know they have legitimate difficulties, and I am sure that with the combined intelligence of the members of this House of Commons and the understanding and co-operation of the provinces concerned a solution for the coal industry will be found.

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LIB
PC
LIB
PC

John Angus MacLean

Progressive Conservative

Mr. MacLean:

Mr. Chairman, the committee has been sitting for ten hours today already, and I think in fairness not only to

Supply

the membership of the committee but to the staff of the house we should rise and report progress.

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LIB

Edward Turney Applewhaite (Deputy Chair of Committees of the Whole)

Liberal

The Deputy Chairman:

I am entirely in the hands of the committee. Perhaps I might say something at this stage which it is not really my duty to say. If hon. members have a prorogation date in view that they hope to reach, it can be reached only by concluding the business which remains to be done.

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PC
LIB

Edward Turney Applewhaite (Deputy Chair of Committees of the Whole)

Liberal

The Deputy Chairman:

Therefore it will be in the hands of the members of the committee when that date is reached.

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An hon. Member:

Carry on.

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An hon. Member:

Ten o'clock.

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LIB

Edward Turney Applewhaite (Deputy Chair of Committees of the Whole)

Liberal

The Deputy Chairman:

Is there consent to sit later?

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June 24, 1954