Hon. E. M. MACDONALD (Minister of National Defence):
Naturally, Mr. Speaker,
I am very deeply interested in this question and in the discussion which has taken place to-day. I want to commend my colleagues from Nova Scotia on the very fair and reasonable manner in which they have presented for the consideration of the House the problems that face us in Nova 'Scotia in regard to the steel industry. The discussion, however, has gone very far afield. We have drifted off into the consideration of whether Nova Scotia coal was good or bad, and into coal questions generally. All these matters have no relation at all to the vital issue before us. There is only one issue before us-small only having regard to all the other questions that have been referred to this afternoon and this evening, but in itself very vast and important.
Intimation was made to the government by representatives of the British Empire Steel Corporation that the Dominion Iron and Steel Company, one of their subsidiaries, was in such a position that they feared a receiver would have to be appointed. The reason they thought that course would have to be taken was on account of the information contained in the report of special accountants, known as Coverdale and Colpitts, who had made full and complete inquiries into the workings of the company and of all its subsidiaries. I happened to be present with my two colleagues, the Prime Minister (Mr. Mackenzie King) and the Minister of Finance (Mr. Robb), when the president of the company conveyed that information to us, and I asked him what did he propose as a remedy. There were only two proposals that he made: first, that there should be a rearrangement of the law in regard to goods coming from countries where there was a depreciated currency; and secondly, he made an argument in favour of a bounty being granted upon coal that was used in the production of steel. He pointed out, by way of illustration, that the Steel Company of Canada and the Steel Company at the Soo, when they imported coal into Canada and used that coal in the manufacture of steel were entitled to receive and did receive a rebate from the government of 99 per cent of the duty that they had paid on the coal when it entered. Therefore, he argued that Nova Scotia should get a bounty of 50 cents upon
Dominion Iron and Steel
every ton of coal that entered into the production of steel. That would mean a .bounty of $2 a ton on every ton of steel. I stated to the president of the British Empire Steel Corporation that I could hardly see the logic of his proposition. In the one case you were rebating duties to companies importing coal, and you were not giving any subsidy at all, but in the other case you proposed to go into the treasury and give a subsidy of $2 a ton on every ton of steel manufactured out of Canadian coal, and that the proposal was one that we would have to consider very carefully. In view of the conditions which he said existed in the Dominion Iron and Steel Company, as disclosed of this report of Coverdale and Col-pitts, the government came to the conclusion that in order to have t'he full and proper information before us, in order to ascertain first, what was the cause of existing conditions, and secondly, what we ought to do, we could not move intelligently unless we had that report. I think the House will agree with me that that was a reasonable and proper proposal, and so my hon. friend and colleague the Minister of Finance (Mr. Robb) conveyed that information to the president of the company.
Hon. gentlemen who were here this afternoon have followed the correspondence which took place, in which Mr. Wolvin took the position that he would not produce the report. Finally, at a conference on Friday last he intimated to the Prime Minister and my colleague the Minister of Finance that he would produce the report for their private consumption only, and that they should not be permitted to communicate even to their colleagues in the government what was in the report. Now that is naturaly a very unreasonable position. Every hon. gentleman who has parliamentary or governmental experience knows that under the oath of office that every privy councillor takes, there are at all times important matters of confidential character which all members of the government have to keep secret in the public interest. We never thought of suggesting that the report should be given to us for the purpose of being thrown open to the public or anything of that kind, but simply and solely for the purpose of enabling us to know the cause of the present conditions, and what was the best remedy-^-because enough was said, and enough has been said in addresses to the shareholders of this company, to indicate that this firm of accountants did make certain findings and also certain recommendations as to the future.
The position of the government is this: We feel we are entitled, before we come to any
policy in regard to the matter, to a perusal of that report. It might be found necessary that certain portions of the report should be given to the House and the country in justification of any action we might propose to take or of any policy we propounded. I am sure that no hon. gentleman with any sense of responsibility would say that this government could act until we have before us the facts contained in that report. We are not insensible to the present position of the company; we appreciate the grave consequences that would follow to the province by the sea if this steel industry should fail, or as my hon. friend from St. Lawrence-St. George (Mr. Cahan) said, be ruined. The consequences would be serious not only to the section where this industry is located, but to all the other industries throughout the province. We are prepared to give the fullest and most sympathetic consideration to any proposition that can be made, and will endeavour to devise proposals in order that what is said to be impending may be averted. But we do think, and we submit to the House, that the president of the British Empire Steel Corporation should allow us to examine that report in order that, being acquainted with the facts, we migjht know what to do.
Topic: COMMITTEE OF WAYS AND MEANS
Subtopic: DOMINION IRON AND STEEL CORPORATION