Mr. Low:

Mr. Chairman, much, at least, of the elation felt by members over the increased assistance to provinces which was announced by the Minister of Finance on Saturday, and spoken of again today, has been dulled by the way in which the offer has been made and the arrangements worked out.

My hon. friend the member for Winnipeg North Centre has made an excellent case

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Dominion-Provincial Relations against the way in which it has been done and I do not intend to labour what he said by any means but merely say I agree with it. There is indeed much to be said for the fact that under the arrangements for extra grants to the Atlantic provinces some figure was pulled out of the air and was offered to them as a lump sum rather than being laid down as part of a formula. I am sure all hon. members will realize there is a great difference between payments made under a formula which come to be considered as payments as of right and a hand-out which cannot be justified as part of a formula.

I suggest to the Minister of Finance that it would have been far better if he had worked out a formula and then made his payments accordingly-as has already been said-instead of the unilateral basis upon which this has been done, which is going to throw a good many of the provinces into a state of confusion.

The third thing about which I am concerned is that the new series of grants will be considered by the government as something final and that we may not get a dominion-provincial conference now for a long time. Furthermore, that this will be used as an excuse for not calling the conference back for a long time, particularly if the federal government now takes the view that it will have to budget for a deficit when it does bring in a budget, if ever. The excuse will then be given that we are spending much more than we are taking in by way of revenues and therefore we cannot countenance any requests from the provinces for a fairer share of the revenues of this country. That is the position we will get into and so it looks to me as though walls are being built to bolster the excuse that may be made if there are pleas for a fairer share of the revenue dollar of this country.

One of the things we have talked about so long in this house has been that very matter, the necessity for a fairer share of the revenue dollar so that the provinces and the municipalities can discharge the responsibilities placed upon them. They have demonstrated fully that they cannot do it in present circumstances. Along comes the government and says to the provinces, unilaterally: we will give you a 3 per cent increase and whether you like it or not you will have to accept that.

The Minister of Finance has said that he will call a dominion-provincial conference as soon as he can.

On Saturday an exchange took place between the minister and the hon. member for Winnipeg North Centre to which I should like to refer briefly because it has a bearing on this question. As recorded in Hansard at

Dominion-Provincial Relations page 3796, the minister had just concluded a brief interchange with the hon. member for Winnipeg North Centre. The passage reads as follows:

Mr. Low:

Yes, is it not an unfortunate situation? When I was sitting on that side of the house and they were over here on my right-not on my immediate right, but jumping one-they used to talk in the same way about the necessity of introducing the partnership principle under which things would be done by conference and agreement. I do not know what has happened to them. I cannot understand it. Is there a disease over here? There must be. They have certainly caught it. I think we will have that area fumigated before we take office, because the thing is catching.

Unfortunately this will all be written into books. I suppose there will be red books and blue books from now until doomsday. That is the unfortunate part of having books; every time we speak our words are indelibly written down for all time. But I am going to say this: we will never settle this matter of the fair division of the tax revenues of this country until the partnership principle is introduced, and it is high time that some government got this into its system.

My mind goes back to another conference, one of the very first that was ever held on this question of fiscal arrangements between the federal and provincial governments. This took place in 1940 when there was held in this very chamber what was known as the Rowell-Sirois conference. It happened in the middle of winter at a time of great difficulty in the provinces. There had been a good deal of pressure brought by the provinces in favour of such a conference and the federal government, in order to placate the provinces, I think, more than anything else, had set up the Rowell-Sirois commission to investigate the financial situation in the various provinces.

Afterwards, when the report had been made, we came down from all parts of Canada to listen to the wise men in the temple of high finance. And I recall very well how the minister of finance of that day and his deputy were called out during the conference by the governor of the Bank of Canada, and a further conference took place in the hallway. Those men came back into this chamber and began to tell us what they would do, and I recall with considerable satisfaction how two men, the premier of my own province, who has been maligned for it ever since, and the premier of Ontario-Mr. Aberhart and Mr. Hepburn-rose one after the other and scotched that conference.

As I look back on that incident, on the proposals they made, and on the practice which has developed since, I thank God for

it, and if anyone wishes to get a clear idea of the developments which have taken place in dominion-provincial fiscal relations since that time to the advantage of the people of Canada, let them just look up the records and see what has happened since 1940 when the Rowell-Sirois commission reported and the conference of which I have been speaking took place. Since those days things have been humanized; we have cut down the institutionalism which seemed to exist in the minds of all those who had anything to do with dominion-provincial relations.

When I say to the Minister of Finance that I do not like the way the present arrangement has been made, it is because I do not think it will create any confidence at all among the provincial governments that this government intends to do what is right, or confidence that they will be able to get back into a conference and settle this matter on a basis of negotiation. But I am not overlooking the fact that the provinces who will receive the increases outlined in the paper which the minister has handed out to some of us today will be happy to have them. These increases are going to help them; there is no doubt about that. Moreover, this help is coming at a time when the provinces are facing a growing unemployment problem and conditions which, in some areas amounts almost to stagnation. As I say, these provinces are going to be very happy about what the government is doing.

I intend to support the proposal which has been made, and to show my good intentions in this regard I am not going to speak any longer, except to say this to the minister: make it abundantly clear to the provinces that you do intend to call a dominion- provincial conference as quickly as you can. And if you find that the hours of sitting are too long, then for goodness sake tell us that these hours will be shortened, and the rest of us will have a bit of a holiday watching you, and perhaps giving you a little bit of good advice on how to do it.

Mr. Solon E. Low (Peace River):

I wonder if the Secretary of State for External Affairs can say if UNRWA is equipped to do rehabilitation work, or is it necessary that such work be done through the governments of the countries where the refugees are located?

Mr. Low:

I rise on a question of privilege, and not to prevent the minister from speaking. I point out that he has done a severe injustice to the members of this group by making a statement that we indulged mainly in personal abuse of the minister. I deny

that most emphatically, Mr. Speaker, and ask the minister to point to any speaker in this group who indulged in personal abuse of the minister.

Mr. Low:

If he is dealing with the question of privilege I will sit down and let him continue until he has finished. I hope that in dealing with the question of privilege he will point out to me anyone in my group who indulged in personal abuse of the minister while discussing the terms of this bill. If he cannot, then my question of privilege is well taken and he should withdraw that statement.