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SESSIONAL PAPERS
VOL. LXXIX .— PART IV
THIRD SESSION
OF THE
TWENTY-SECOND LEGISLATURE
OF THE
PROVINCE OF ONTARIO
SESSION 1947
488943
2. A, A-g
TORONTO
Printed and Published by Baptist Johnston. Printer to the King's Most Excellent Majesty
1948
CONTENTS
FOR PART IV
REPORTS
PROVINCIAL AUDITOR
WORKMEN'S COMPENSATION BOARD
ONTARIO VETERINARY COLLEGE
DEPARTMENT OF HIGHWAYS
ONTARIO PROVINCIAL POLICE
DEPARTMENT OF TRAVEL AND PUBLICITY
ROYAL COMMISSION ON FORESTRY
ROYAL COMMISSION ON MILK
LIQUOR AUTHORITY CONTROL BOARD
PROVINCIAL
AUDITOR'S
REPORT
1945-46
PRINTED BY ORDER OF
THE LEGISLATIVE ASSEMBLY OF ONTARIO
SESSIONAL PAPER No. 27, 1947
ONTARIO
TORONTO
Printed and Published by T. E. Bowman
Printer fo fhc King's Most Excellent Majesty
1947
To ThK HONOIHABLE R.W J>A\\.SOX. O.B.E.,
Lirulcnanl-Clovrrnor of the Province of Ontario
May Ii' Plkase Y'ouh MoxorK:
'V\\Q undersigned has the honour to present to Your
Honour the Report of the Pioxineial Auditoi' for the year
ended March .'ilst. M.)l(i.
Respectfully submitted.
Le8lii: M. Frost,
Trcatiiirrr
Tieasury Department, Ontaiio
January 20th, 1947
3^
Pi()\incial Auditor's Offu-o,
.lanuaiy 20th, 1917
To The Honourable Lkslii: M. Fiiost.
Provincial Treasurer
Sir:
I have the honcnir to submit, for the information of
the Legislative Assembly, my leport foi- the year ended
March 31st, 1946, in accordance with the requirements of
The Audit Act.
Resi)ectfidly submitted,
H. A. COTNAM, C.A.,
Provincial A udilor
TABLE OF CONTEXTS
(A) Treasury lioiud Miiiulc-
(Bj Special W'airaiils
PAGK
(A)
TREASURY BOARD MINUTES
|7
.\ r Diiou's IvKi'our foi; I'.llo JO
(A)
TREASURY BOARD MINUTES
STATEMENT OF TREASURY BOARD MINUTES ISSUED I- OR EXPENDIIURES IN
EXCESS OF APPROPRIATIONS. DURING THE FISCAL YEAR
ENDED MARCH 31sf. 1946
Department of Ayrirulture
Main Office:
Services and lOxpen.se.s re Agricultural Work, etc
rnemployment Insurance .Stani|)s
Agricultural Enquiry Commission
Agricultural and Horticultural Societies Branch:
Salaricis
Horticultural, Agricultural and Vegetable Growers' Meet-
ings, etc
I'ield Crop Competitions, Prizes, etc.
Ciants to Encourage Local Plowing Matches
Live Stock Branch:
Sidaries
l']duc;itional and Demon.>tration Work, etc.
Women's IiKstitute Branch: Salaries
I'ruit Branch:
Salaries
I'ruit Work, etc., including Expenditure under The Plant
Disea.sos Act, etc
Loans in Accordance with The Co-operative Marketing
Loan .\ct
Agricultural liepresentative Branch: Salaries
Crn|)s, Seeds and Weeds Branch:
Salaiies
Maintenance
Administration of The Weed Control Act, Crop Improve-
ment Work, etc.
Suliventions — Freight on Agricultural J>ime
i\cin|)tville Agricultural School:
Ceneral Office — Expen.ses
.\11 Divisions— Salaries, Wages, Travelling and Cencral
Expen.ses, etc
II'Mticultural Experiment Station, Vineland:
Salai'ies
Services, Tra>elling and Other Expenses
We.-tcrn Ontario Experimental Farm, Ridgetown:
Purchase of Stock and Equipment, etc.
Demuistration Farm. Xcw Liskeard: Salaries
1 )om'iiistratii>n F'"arm. Hearst:
M.iinten.uice, Wages, Equipment, etc
Ontario X'eterinary College. Guclph:
Salaries
'I'm veiling Expenses
i'liei, Liglit, Water, etc.. and Contingencies..
Scholarships and Prizes
Research, Investigation and IJxtension Work
I'rovinciul Zoologist —
Salaries
Services, Equipment ;ind Repairs
Ont.irio Agricultural College. Ciuclph:
( leneral Oflice —
Salaries
I'ixpenses
.Ml Oivisions—
Salaries.
Expen.ses
\^'\l{|{ w 1
llXPK.NDI.D
20,000.00
900.00
.-).000.00
^< 24.420.84
279.7.".
922.!.".
l.27.">.00
I.l."..s.7.".
lis
'.i.".8.07
o30.3it
190.10
170.00
2.800.00
f..7.">."..00
171.71
2,790.90
(■..003.12
1. 1 (■..".. 00
1.102.2C.
12.()(l().()()
11.730.80
.■>().(K)()00
37.".. 00
1.".. 100.00
3,70.83
1.333.00
700.00
1 332.32
(■.2.". 70
lO.oOO.OO
3.300.00
10.109.07
3.250.10
8,.-,00.0n
8.390.(i7
8.200.00
.">.! 10.87
400.00
I.OoO.OO
39 L93
4,048.81
K350.00
2.8G0.00
1.327.70
2,709.42
350.00
:-Mi.23
70.12.").()n
4.000.00
04,800.00
200.00
.".!>. I. ".0.00
07.708.20
3.191.02
0I,.")72.8C.
r>4.37
.".'.t.0oG.08
;'..iO().oo
3. 0( )()()()
3.100.00
87.90
08,700.00
249.000.00
O.j,490..3."j
234,043.84
319.020.00
210.2^0.00
348,900.99
210.727.78
10 .Vi 1)110 u's Hki'oht Foi! ]\)\') 4() Xo. 27
Department of Attorney-General
Main OfRce:
General Litigation and Legal Services
Comniis.sion.s and Sundry Investigations
I'nemployment Insurance Stamps
(3fiice of the Legislative Counsel:
Salai'ies
Maintenance
Supreme Court of Ontario:
iVfaster's Office — Salaries
C'riininal .Justice Accounts:
Toronto and York Crown Attorney's Office — Salaries
Districts — Salaries
Magistrates — Salaries
Public Trustee's Office:
Salaries ?
Cost-of-Living Bonus
Fire Marslial's Office: Salaries
Inspector of Legal Offices:
Local Masters of Titles Offices —
lOxpenses.
Forms, Copying and Contingencies
County .Judges, Travelling Expenses, Attending Division
Courts
Ontario Securities Commission:
Services, Expenses, Valuations, etc
Maintenance
Department of Education
Main Oflicc:
Salaries
Maintenance
Proj)orti(jn of Cost of Minister's Report
Legislative Library: Salaries
Public and Separate Schools Branch:
Travelling and Moving Expenses of Inspectors, etc
Correspondence Courses, Salaries and Maintenance
Auxiliary Cla.sses, Salaries, etc
Visual and Radio Instruction, Services and Maintenance...
Art Department — Salaries, etc
Courses in Music, Salaries, etc
Pamphlets and Reports for Use of Schools
Dei)artmental Examinations Branch:
Salaries ,
Maintenance
Services and Travelling Expenses
Training Schools Branch:
Salaries
Travelling Expenses of Normal Scliool Students and Masters
to Rural Public and Separate Schools, etc
Xormal Schools:
Petei'borough —
Salaries
Travelling Expenses
Stratford — Salaries
High Scliools ami Collegiate Institutes Branch: Salaries .
X'ocational Education Branch:
Salaries :
Tra_velling and Moving Expenses
Maintenance
Ontarii> Training College for Technical Teachers:
Salaries
Critic Teaching, including Travelling of Masters and
Students
Maintenance
\y
.\UU.\ NT
l'>xi'ij;xi>i:n
300.00 ;
15.000.00
.300.00
> 96.21
10.723.83
114.38
1 .000.00
1,050.00
917.()6
576.79
3,500.00
1.S25.(K)
ooo
ddd
ooo
O'OO
4,9.';6.40
8,860.66
7,949.71
20.000.00
3,000.00
3,000.00
16,136.35
265.19
2,407.77
400.00
500.00
283.93
39.88
1,000.00
589.75
2,."')0().00
1,000.00
1.491.35
3.993.23
3,000.(K)
l..-)00.00
500.00
100.00
2.518.91
3.918.31
355.71
39.10
35,000.00
2.000.00
."iOO.OO
23, .500.00
!,. 500.00
10,000.00
25,000.00
31,393.41
1.592.35
44.89
18,601.73
354.81
8,314.40
19.314.72
3,000.00
2,000.00
10.000.00
2.974.76
1,545.,52
7.123.01
1,500.00
1.366.72
2,500.00
1,393.35
400.00
300.00
2,200.00
(■..,")00.00
299.43
37.65
2.199.96
6.092.92
2,000.00
1,500.00
2.000.00
1.545.51
611.22
1,252.77
19.500.00
1,149.91
10,000.00
5.000.00
6,713.61
2 560.50
Ai ditok's Kkj'Out fok 1945-4()
I I
Provincial Technical Institutes:
Piovincial Institute of Mining, Haileyburv— -Salaries, etc
and MaintcMance
Legislative (hants: Secondary School Education
Ontario School for the Deaf, Belleville:
Travelling Expenses
Maintenance
Ontario School for the Blind, Brantford: Salaries
WaRRAN I'
•2,.")0().()()
100,000.00
300.00
5,000.00
2,r)00.00
EXPENDKO
2.2()7.2.i
;»9, 800.25
133.88
1 .882.75
1 ,048.70
Department of (>anie and Fisheries
Main Ollifc ('ompciisatioM for InjurcMl Workmen..'
l']nforcemcnt of Tiie Game anil Fisheries Act
Game Animal.- and Birds — Services and l^xpenses
Macdiaimid — Services. F]x|)en,ses, Repairs, etc
Biological and Fish Culture Branch:
Hatcheries, Services, Maintenance aiul Operation
Bear Bountv
100.00
4(),000.()0
7,000.00
500.00
1. 000.00
3.000.00
•13.89
45,805.84
(1,002.27
245.(1 1
2,574.75
1.348.00
Department of Health
Main Office:
Inforescen and l'nj)rovided
Grants — County Councils re School Medical Inspections
Dental Service Branch: Salaries
l"jpidemif)logical iiranch: Outbreaks of Disea.ses. etc.
Tuberculosis Prevention Brancli:
Maintenance
CJrants — Maintenance of Patients in Sanatoria for Con-
sumptives
Ottawa Clini( — Salaries
Tinmiins Clinic— Salaries
Industrial Hygiene Branch: Salaries
Laboratory Branch, Central Laboratory: Maintenance
Hegional Laboratories, Kingston: Maintenance
nosi)itals Branch:
Ontario Hospitals Branch — Genera! F^xpenses
Salaries
rnemployment Insurance Stamps
Ontario Hospitals^
Brock ville — Salarie.^^
Cobourg — Salaries
Fort William- Salaries
Hamilton -
Sal.aries
Maintenance
Kingston — Salaries
LangstafI' — Salaries
London — Salaries .*.
New 'I'oronto — Salaries •.
Orillia Hospital School — Salaries
Penetanguishene — Salaries
St. Thomas —
Salaries
Maintenance
Toronto —
Salaries
Maintenance
Whitby — Sal.aries
Woodstock —
Salaries
Maintenance
Toronto Psvchiatric -Salaries
1,000.00
064.48
4,000.00
3,447.50
4,000. ()()
3,712.42
55,000.00
.52,834.72
2,000.00
1,097.()1
135.000.00
79.714.05
100.00
(12.05
200.00
72.78
COO. 00
583.08
10.0(10.00
5,062.72
5(10.00
489.18
12.100.00
9.485.19
1.800.00
1,701.74
2<),200.00
26,472. (i3
1 ,200.00
1.0()6.5(i
3.000.00
2.910.79
34.000.00
30,171.13
40,000.00
39,999.91
12,800.00
9.026.81
0,000.00
5.090.63
50.000.00
54.057.8()
47.700.00
44,84().39
32,700.00
30,.59().18
11.400.00
11,375.38
100.000.00
46.817.18
100,000.00
7(),243.I9
43,100.00
41,302.20
25,000.00
24,843.25
10.000.00
8,096.23
5(i..')00.00
51.769.23
10.000.00
9,998.44
l,s.. 500.00
13.111.77
Department of Highways
Main Office: S.alaries
2(i. 000.00
23.675.21
12
AuDiTOi;'s l{i;i'Oirr koi; MM 5 1(1
Department of I.aboiii-
Main Office: Inemployinent Insurance Stamps
Industry and Labour lioard: Maintenance
Apprenticesiiip Branch :
Travelling Expenses
Maintenance
lioard of Examiners of Operating Engineers: Salarie:
Labour Relations Hoard: Maintenance
W \HRA\ 1
; I ( )().()(»
101)1 )().()()
l..->00.()0
1 .000.00
;iOO.oo
7.000.00
EXPF.NDI D
s :;() .sc,
7 ir)().0'j
7.")S.3!»
9<)0.(i!)
172.(iO
.').7'.t:i.-.]
Department of Lands and Forests
Main Office:
Maintenance and Operating;
Legal Fees and Expenses
Field Services:
Surveys Branch — CJround Surveys
Forest Research I^ranch — Sjjruce Budworm Control and
General Field Research
Basic Organization — District Offices (including Provincial
Parks) — Salaries
Extra Fire Fighting —
S;daries — Tenipu»ar_\'
Maintenance and Operating
Scaling —
Salaries — Tempiraiy
Travelling Expenses
Maintenance and Operating
Air Service Branch —
Salaries
Travelling Expenses
Reforestati )n Branch —
Salaries
Travelling Expenses
Maintenance and Operating
1."). 000.00
r2.HS.;«
.")00.00
172.10
1 .')()0 0()
1.2->S..-)t
(■..'..000.00
.v.),2;i.').(i(i
20.000.00
i:;..');i(i.()i
1 10.000.00
'.)4.K1 -)..-).•?
■_'.-. ooo.oo
l(i.2;{.").42
S.-). 000.00
S0.-I77.2'.l
7.000.00
3.921.1(5
10.000.00
fi.821.32
1.".. 000.00
'.».3(1S.33
2.000.00
l,:)Oa.37
IS.000.00
11.'.I33.7'.»
1 ..')00.00
()()3.4()
.-). 000.00
IK.").'.)!
Department of Legislation
Office of the Speaker:
Salaries 800.00 ^17.fiO
Indemnities — Members, including Mileage 12.000.00 1 I CO.'). SO
Legislative Committeee fur Art Purp<i.se« l.",(').."i() l.V(..")0
Cost-' .f-Living Bonus 2.".0.00 120.^7
Department of Mines
Main Office:
Maintenance _ .VOOO.OO 4.323.r,0
Fees — Legal, Professional and Miscellaneous Services .'). 000.00 2.9.")(i.,S.")
Mines Inspection Branch: Salaries, Equipment and Expen.ses 2..")00.00 1. 832 12
Laboratories: Salaries. Equipment and Operation of Laboratriric.'^. 3.500.00 2.(177. 13
Office of Mining Recorders: Salaries and Expenses (i. 000. 00 .").<(!)."). 27
Department of Municipal .\ffairs
Main Office: Subsidj' to Mining Muiiicip.ilitic.^
Ontario Municipal Board:
Salaries
Travelling Expenses
..".00.00
,000.00
C.OO.OO
.') 177.'.)3
-t.(iS(i.:i8
m.i I
Department of Planning and Development
Main Office:
Travelling Expenses 3.000.00 2.371.10
Maintenance (i.oOO.OO (1.095.37
Planning and Investigation for Conservation, Restoration
.■ni<l Development of Xatural Resources, etc lOLOOO.OO 103.9.-)S.99
Auditor's Report for IU4') 4(; 13
Department of the Prime Minister
Wakkam I!\i'i:\di.d
M,-.iii Odi.-c:
SnlMiios :< l.-..000.(M» s 0,739.78
TravollinK Expenses 1 ..>00.00 (193.37
Maintenance 1.300.00 1,299.96
Provincial Auditor's Office
Salaries 1,. ".00.00 3 90.". S7
Department of Provincial Secretary
Main Oflice:
Maintenance
Incmployniont Insurance Stamp.^
{{oKi.sliar-Cicncrars Hianch: Salarie.-;
Kofi )imat< dies and Prison.s Hrancli:
M.iin Oflice
Salai-ics
Ti.ivcllinK I'iXpenses
Maintenance ^
Legal Ctwts and Expenses Coverinfi; Sundry Investiga-
tions
Co.st-of-LivinK Bonus
( Irants — Trainini; Schools ,..
Hoard of Pan.lc
Salaries..
.Mli.uanccs and Kxi.cn.se.s fur PaiMJc Bicird
'rravciiiiiK Kxpenses
Maintenance
Ontario Hcformatories —
(ludph
Salaries
Maintenance
Industries
Miinico —
Salaries
Maintenance
Industries
Mercer, Toronto —
Salaries
Maintenance
Industries
Industrial Farm. Bur\va.sh —
Salaries
Maintenance
Ontario Trainin}!: School for Boys. Bowm.'tnvillc
Salaries
M:iintenance
Kei)airs to Buildings, etc
Ontario Training School for Girls. Cobourg -
Sal;iries
Maintenance
Hepairs to Buildings, etc
Department of Provincial Treasurer
Main Ollicc: Salaries 1,.".(X).(X) 3 .>S2.81
Bureau of Statistics .and Research: Maintenance 300.00 297.09
("ontrollei' of Revenue Branch:
Salaries 11.000.00 10,137.34
'i'ra veiling Kxpenses 1,000.00 3,2r)0..")S
Mainten.mce '. 2,.")00.00 2,20">.02
i'ees 3.700.00 3.(io6.72
1 .000.00
.3(K).00
l."..(K)0.00
937.38
239.62
3.">.233.3:.
(•...".(K).00
1.000.00
1.. ".00.00
r.,203.(X)
296.91
1.101.3(j
200.00
16,000.00
8.000.00
43.28
6,4o9.08
.".,872.7.".
2,.".00.(M)
1..800.(K)
700.(M)
(-.00.00
1,781.21
1.108.27
(579.69
168.31
10,000.00
12.000.(M)
."..".. (M)O.OO
9. .".96.68
1.0.">9.3()
46.837.78
»,0()0.(X)
22.(M)0.00
30(K)0.00
3.783.83
17.617..5S
21.953.84
1,000.00
2.000.00
40.000.00
3,361.62
1,70S,S7
39.880.04
.■>.000.(K)
4.".,000.00
I,068.S1
1 1.909.10
9.000.00
.30.(KX).00
."..8(H"t.OO
8.013.20
21.1.V).75
1.61 (.54
12,000.00
1. ".,000.00
1. ".00.00
9545.70
10 (-.93.93
1 I30.,86
14 AruiTOii's Ki;i-oi;r fok 11)15 4() No. 27
Warrant Expf.xdkd
I'ost Offu-e: Salaries ,S 1.000.00 .s 43(;.7:)
4'r;ivel and Piihlicity liiireau: Salarios .'>, 000.00 3..SIO.S7
Office of King's Printer:
Salaries 4.600.00 3,.504.68
Cartage 100.00 85.18
Offifial Cazpttp 2.000.00 1.051.72
Department of Public Welfare
Old Age PcMisions Commissi n:
Pensions -Old Age and I'.liiid .S.3.-),.")0( ).()() (i64 287.44
Medif-al Services 1), 000.00 8.468.89
Special Provincial Bonus 11.500.00 618.97
Department of Public Works
Main Ollicc:
Travelling Expenses
Maintenance
Public Building.s — Maintenance and Repairs:
General Superintendence — Salaries
Lieutenant-Governor's Apartment — Salaries
Legislative and Departmental liuildiugs —
.\dministrative Services
Salaries
Typewriter Inspecti m and Ke[)airs
Maintenance Staff —
Salaries
Maintenance
Mechanical Staff—
Salaries
Repairs and Alteratiotis
Osgoode Hall —
Salaries
Maintenance
District liuildings — Salary of Caretaker, Timiskaming
Ontario Hospitals — St. Thomas. Farm Operating l*]xpenses
Miscellaneous — Moving Patients, etc., of Provincial Institu-
tions Lea.sed to D )minion Government
Public Buildings — Con.struction :
General — to Provide Additional Accommodation for Govern-
ment Purpose.s, Construction of New Buildings, etc. -
Ontario Reformatories — .\dditi'ins. .\lterations. etc
Total Treasury Board Minutes
2.300.00
1.000.00
1.109.12
999.84
3.700.00
100.00
3.152.42
65.00
3.500.00
200.00
3.021.94
189.54
33,000.00
15,000.00
30.500.16
14.963.87
2,000.00
9.000.00
1,624.94
6,736.72
3,000.00
4,600.00
600.00
13.000.00
2,741.04
3,868.75
240.89
11,851.97
100.000.00
53,236.07
400.000.00
2,000.00
256,351.74
1,185.63
S5.013. 180.50
$4,154,322.74
(B)
SPECIAL WARRANTS
I.")
A 11) I tor's Ri;poRr for 1915 UJ 17
(B)
SPI^CIIAL WARRANTS
Tlu> Second Session of tlie Twcnty-fiisl Lej:2;islalure of Ontario was dis-
sohod on March 24, 1945, witiiout havinj^ resolved itself into Committee of
Supply to consider the estimates for the fiscal yeai- ended March 31, 194(5.
in order tliat tlie business of government might he carried on, funds were
made available by Special Wan-ants to meet expenditures lU'gcMit and neces-
sary for the public good. Such Special Warrants were obtained under authoi-ity
of Section 1.3, ss. 1 (h) of The Audit .\ct, R.S.O. 1937, chap. 24. and were
issued as follows:
April 12, 1945 :...-. §5,011,003.50
May 12, 1045 5.391.328.41
June 1, 1045 7,103,380.08
$18,106,320.99
These Special Warrants were based on monthly forecasts of ordinary
ex|)enditure anrl capital payments, prei)aretl by all dei)artments which were
submitted to a sub-committee of the Hutlget Committee. Each item was
closely scrutinized and only those itejns which could be considered "urgently
and immediately retpiireil for th(> j'jublic good" wei-e appi-o\<Ml.
Ou issuance of the Special Warrants, the funds made a\ailable to the
l*ro\incial M'icasuier were aliocat(M| in accoi'danee with the detailed schedides
pre\'iously submitted 1>\- the se\eral departments and as appro\-ed by the
Budget Committee.
Undei- the aulhoritx- of the Special Warrants abo\-e state(|. expenditures
were made until the passing of The Supi)l>- .Vet. 1<)45.
The Supply Act, 1915, 9 (ieo. \'I (Second Session), Chap. 11, providing
funds in accoidance with the estimates for the fiscal year ended March 31.
1 9 HI. in the amount of .1i;81,317,47().30 was passed and a.s.sented to July 20.
i!)l5. 14iese appropriations weie declared to include antl not to be in addition
t(» the amounts authoiized by the above noted Special Warrants.
44ie following schedule shows by Departments the allocation, expendi-
tures and the unexpended amounts of tiie Special Wanants;
.Special Warrants Dated
.Vprii 12, May 12 and .June 1, 1945
Dki'aim'mi^x r .Vrriiom/KU 1*"xpi:\di;i) I'xkxi'kxdki)
Agriculture ,s 7(i7,()32.-l!l >; .568.443.55 -S 199,188.94
Attoniey-Goneml 797,759.60 711.403.50 86,356.16
Kducation 1.855,899.99 1,388,343.07 167,556.92
Game and Fisheries 171,620.00 1.55,9.58.39 18,661.61
Health J.SUl.S.SO.OO 2.493.652.48 101.177.52
Highway.'! .Ss;i„-)O0.00 361,716.82 18,783.18
liisuianco 15.900.00 13,756.33 2,143.07
l-ahour .■);i7. 920.00 1.56,072.96 381.847.04
l.and.^ :nid Forests I . H2,.")0.S.32 791.909.27 620,.599.05
l.oKi.slation 21,0,S2.06 9,227.85 11,8.51.21
18
AriMTOit's lvi:i'Oi!T foi; 10 1") 4 C)
Department
Lieutenant-Governor
Mines
Municipal Affairs
Planning and Development
Prime Minister
Provincial Auditor
Provincial Secretary:
Main Office and ReKistrai-Cicncial
Reformatories and Prisons
Provincial Treasurer
Public Welfare
Public Works
Miscellaneous
Ordinary..
Capital...
AtTllORIZED
s 2. SI 0.00
141.735.00
24.800.00
.").•}. 3< ■.."). 17
(i4.C.Sl.0()
29.3:)0.00
70.700.00
(ii:i.s.->o.oo
l,()l},(il.-).00
(;,(■,.-, i,2;i2. 00
110,000.00
100,000.00
Expended
s 2.495.00
100,452.92
20.02'.».08
35,452.70
02,272.07
2S.1S5.03
57.400.()C.
520,4 IS.Sl
894.()34.(;3
t),2()2. 200.75
201,S51.IO
270.25
I NEXPENULD
.S 315.00
44,282.08
4.270.02
17,012.77
2. 408.03
1 101.07
13.200.01
110,131.10
1.50,010.37
302.031.25
205.148.00
00.723.75
^S18, 106,320.99 $14,848,155.32 $3,258, U)o.67
813.141,820.09 810.708,570.04 .82.133,250.95
4,904,500.00 4.139,585.28 824,914.72
$18,106,320.99 $14.848.155.32 $3.258.165.67
These expenditures were sul)se(|uently incliulcd in the \'ote.'s and item.-^
as authorized hy The Sui^ply Act, 1945, and form i)art of the Sujiply Acl
expenditure for the fiscal year I'.llC), as shown in ihe Puhhc Accounts. 11H().
Special Warrants, oilier than the aljoxc mentioned, ai'e shown in tiie
followino- statement :
STATEMENT OF SPECIAL WARRANTS ISSUED DURING IHE FISCAL YEAR
ENDED MARCH 31st, 1946
(excluding Special Warrants dated April 12, 1945, May 12, 1945,
and .June 1, 1945, respectively)
Date of
Warrant
Service
W ARRAXT
Department of Agriculture
Grant to the Cochrane Di,strict Pro-
ducers Co-operative Ltd. foi' the purpose
of assisting in the construction of a
Potato Warehou.se.
Balance unexpended,
1944-45 .i>15.000.00
Aug. 28, 1945 W.arrant 5.000.00
Department of Attorney-General
Feb. 15, 1946 Payment of Xe\vspai)ei- Adveitisements
and Telegraph .\ccounts incurred in
connection with the Radio Address of
The Honomalile the .\ttorney-General.
delivered on l""rida>-. Xovember 23rd.
1915. and entitled "Hcpcrt on the
Windsor Strike"
l]XPEXDi;U
1945-46
(100.00
EXPKXDED
20.000.00 20,000.00
5S4.04
15.30
A r 1)1 lo k's Uki'okt kok 1'.)!.") ) (i
I ".I
JJah: ui
Warrant
Service
Warrant
I.Xl'h.NDl.U
1945-46
EXPENDICD
Apr.
July
June
Department of Education
Scrvicos ami I'^xpfuses and Honoraria ol
a Coiuinittop on Planninsr, Construction
and lOquipnioiit ol' .Scliools in Ontaiio.
Halanro unexpended. 1944-4o s. II'2..")I
Payment of Expense.s of a Commission
on lOducation u)uler the chairmanship of
'J'lio Honouiahle Mr. Justice Hope,
appointed bv Order-in-Council, March
21st, I'.tl.").
P.tl.") Warrant -SlO OOO.OO
IMj.-) , Warratit .•^1. 1 l.").00
1 .()(M).00
Payment of Ten Scliolarsliips of One
Hundred Dollars each for Teachers of
French em[)loyed in the Collegiate
Institutes, Hi^li, Continuation and
\'ocatioual Schools of Ontario, selected
to attend the Summer Course for
Teachers of Oral Krench ci^nducted by
the Tniversity of Western Ontario at
Trois Pistoles, (Quebec. June 28th to
AuKu.st 22nd. VM')
.luiic \y>. I'.ll.') P;iymciit of Transportation Co.'jts iu-
I currcd bv the following; schools to
I December :ilst, 1 !)44— District of
I Kenora, P.S.S. Xo. 3, Zealand. 8158.62;
Count V of lOssex. P.S.S. Xo. 2. Pelee.
I -SZ.l.OO: P.S.S. Xo. A. Pelee. .^T.^.OO
Dec. IS. 11)1.") Cirant to tlie Canadian Arrangements
Committee for the World Youth Con-
ference
Oct. 1 I I'.M.'. I'liblic and Separate Schools Branch:
1 iJducational Service.s for Handi-
capi)e(l Children, for which no
other provision can be made
M(»del Elementary School Building,
Services. Materials and lOxpenses
for Construction and Equipment
in part
itevision of Course.s of Study, Serv-
ices. Travelling. Printing, etc
Physical I'itne.ss and Recreation Pro-
gramme:
Grants and Maintenance —
Salaries and Expenses. S7,000.00
Communitv Pro-
gramme Cirants 75,000.00
Camp Sui)sidie,s 10.000.00
Recreation Mainten-
ance Grants 8,000.00
Vocational Education Branch: [
Instruction in H.'indicrafts, for Pro- 1
vision and Maintenanceof Schools ' '
by Ontario College of Art 20.000.00
Research and Revision of Courses,
Grants, Services, Travelling and
Supplies j.OOO.OO
:«)8.02
I
250.001
f, 000. 00
25,000.00
10.000.00
(1,1 ST. 1 7 2,225.37
ll.H5.()0 ;}().5I0.7-1, 10,934.26
1 ,000.00
308.62
250.00J
I
1,104.71 2,53526
6.979.52; 18.020.48
SOO.OO 9.200 00
100.000.00 27,021.16 72.978.81
17.249.52 ^",750.48
2,727.10 2,272,90
20
A i: Diro H 's K i;i'oi; r v
o i;
Daii; i)1'
Wauuant
iSkuvkk
VV'akuam'
1915-40
In-
i;xri;.Nui;i)
.Iiilv 10. 1!
Lef^islative Grants:
I"i)i' \'()catii)iial Educatiui), Cost of
Kducatioii of Xon-resident Pupils.
Main Odicr:
DojjartiHPntal Pul)licatioiis
Mi}i;li Scliodls and Collegiate Institutes
liraiK'l.:
P;nni)ldets anil Reports for use of
Schools. Services, Travelling,
Piinting, etc
Department of Health
Cirants: Arnpriorand district ^lemorial
Hospital. Arnprior. «].'). 000.00: West
Lincoln Alcnioii;il Hospital, Grimsbv.
•SIO.OOO.OO- Winghani General Hospital.
Winghani, •'^10,000.00
Oct. ;!(), I'.M.") Payment of I-]\])enses of the Ontai'io
Municipal Health Ser\ices lioaid
Nov. 20, I'll.') Grant to the Welleslev Hospital, To-
ronto, S1.')0.000 00: Grant to Queen's
rniver-^ity. Kingston. §112,500.00, to
be distributed l>v the I'niversitv as
f(»llo\\s: §75,000.00 to the Kingston
General Hospital and §37,500.00 to
Hotel Dieu Hospital, Kingston, for the
l)urpose of improving Teaching Facili-
ties a.s required l)y the University in
each of the said Hosjiitals
Department of Lands and Forests
lu]i<> P.t. l'.l|5 Settlement re Assignment of Timber
Area*
Department of the Prime Minister
.lune 2(i, l'.H5 Purciiasi; of Amenities and otlier Requi-
sites for tlie Shii> and Crew of H.M.C.S.
"Ontario." whicli lias been adopted by
1 tiic Province of Ontario, recently com-
! mis.sioned in Great Britain for service in
tlie war against Japan
Aug. 2.'n, 1'.II5 Payment of I'Apenses of a Commission
to (Mifpiire into and report ujxui all
, matters concerned with Scientific and ;
Industrial Research as they affect the 1
Province of Ontario, under the chaii-
manshi]) of Dr. P. C. Wallace, appointed
bv Order-in-Council dated the 28th dux
of August, HM5 '
I'urchase and Distribution of Apples for |
Memljers of the Armed iMuccs at home
and o\'erseas.
Iialance unexpended
1941-45 8 680.44 i
Feb. 27. 191G Wairoit 1.500.00
?
c.
10.000.00
1 ! ,000.00
8,000.00
10,822.58
7,083.01
35.000.00 35,000.00
1 ,000.00
2()2,500.00
466.62
262,500.00
111,000.00 lil.OOO.OO
5,800.00
10.000.00
5. 180.44!
$ c.
10.000.00
177.42
916.99
533.38
1,251.65 1,518.35
1.788 99' 5,21101
4.032.32 1.118.12
Al Dirou's liKl'OlM FOli \\)l') 4{')
21
1)
A ri:
( )i
i;xiM;.\ni;n
Ix.
w
\Htl\\V
SkuvkI';
W AKKANT
H)4r>-4G
i:xim:m)i-.i)
Depart men I of Provlmial TieasurtT
P;iynjont of Kxpoiises incurred in con-
noction with the Hoval Commis.sion on
Piihlic Hulls. est:ihlislie(l by Order-in-
Ciiinicil made 27tii June. 10-14.
Hal.ince unexpended,
H)44 4;") $ 10.70
•S <•.
.S e.
$ e.
\p..
2.'>.
l!ll.'>
W.iiiant l.-jnO.OO
Payment ol' lixpenditurcs in conneetion
with 1 )()niinion-Provineial Coid'ereneo,
lOl.').
1 .')1<).70
1.320.20
100..")0
Aii^z.
2,S.
2(i.
1.").
1!»4.')
1 '.»!()
Warrant SC) 000.00
12,000.00
10..S.")1.2.")
I'ol).
Warrant (i, 000.00
L14,S.7.")
.Inn.
Payment of Rent. Office Furniture and
lOquipment. Salarie.-;. M.iintenance and
ail nthei- llxpenditures connected with
the M.stahlishinp of an Office in Ottawa
in regard to the Dominion-Provincial
Conference, 1<.»4.")
1.000 (M)
1 ,()80.20
2.313.71
Department of Public Works
Purchase and I'ramint: of a Portrait of
Hon. ( lortlon 1 ). ( 'onant. Prime Ministei'
of Ontario from October 21st. 1<.H2. to
May ISth. 1943.
Halance unexpended. I'.)l 1 - 1.')
.JltiOO
OO.(K)
2.")(;.0()
1m>I).
.").
l')4()
Payment of Accounts for Rental and
Caretaking of i.ea.sed Premises and
Ilxpenses in conneetion therewith for
Oflice Acconunodation for Departments
of the (io\ernment at !.')•") S pad ina .\\'e..
Toronto, and 12'.) (^ueen St. and Store
Xo. 7 and S on the Arcade at 130 Sparks
St.. Ottawa
8.000.00
7.32(5.00
073.01
lotal
721. .332. 30
.")7(i.2.S1.21
n."i.o.ji.oo
REPORT FOR 1946
OF
The Workmen^s Compensation Board
ONTARIO
PRINTED BY ORDER OF
THE LEGISLATIVE ASSEMBLY OF ONTARIO
Sessional No. 28, 1947
ONTARIO
TORONTO
Printed and Published by T. E. BOWMAN, Printer to the King's Most Excellent Majesty.
1947
To The Honourable
The Lieutenant-Governor of the Province of Ontario.
May it Please Your Honour:
The undersigned begs leave respectfully to present to Your Honour the
annual report of the \A'orkmen's Compensation Board of Ontario for the year
ending on the 31st day of December, 1946.
CHARLES DALEY,
Minister of Labour.
March 17th, 1947.
THE WORKMEN'S COMPENSATION BOARD
WILLIAM MORRISON, K.C.
Chairman
DR. D. J. GALBRAITII.
\'ice-Chairman
JOHN F. CAl'LEV.
ConimissioiuT
S. R. JOHNSTON,
Secretary
REPORT FOR 1946
O F
The Workmen^s Compensation Board
ONTARIO
Offices:
4th Floor, Canada Life Building,
330 Tniversity Ave., Toronto.
To His Honour The Lieutenant-Governor:
The Workmen's Compensation Board begs to submit its Report for the
year 1946.
GENERAL REVIEW
The year shows an increase of payroll, accidents reported, and compensation
awarded, each item reaching an all-time high record. The payroll covered
increased 10.93 per cent., the accidents reported 17.21 per cent., and the benefits
awarded 25.63 per cent, over corresponding figures for 1945.
Payroll in Schedule 1
The pa\Toll in Schedule 1 was $1,295,440,500. in 1946, as compared with
$1,167,802,000. in 1945.
Accidents Reported
Accidents reported increased from 118,220 in 1945 to 138,570 in 1946.
Benefits Awarded
During 1946 the benefits (compensation, medical aid, rehabilitation, etc.)
amounted to $16,502,023.89, as compared with $13,135,938.38 awarded during
1945.
Schedule 1 Assessments
The average rate of assessment increased from 81. 12 for each SI 00 of payroll
to $1.16, the increase being due to more hazardous industries being substituted
for less hazardous industries in the post-war period: there was no substantial
increase in rates charged the employers. At the end of 1946 there were 35,296
employers under Schedule 1, as compared with 29,039 at the end of 1945, the
addition being largely due to inclusion of industries not formerly under Schedulel .
Assessments paid for 1946 amounted to $12,937,916.21 and it is estimated
that a further $2,082,000.00 will be received. The total assessment for 1946,
on a provisional basis, is therefore $15,019,916.21. There was $61,028.00
received as refunds from various sources and from application of sections by
way of penalties and other sources of income. The total receipts for the year
(actual and estimated) were $15,080,944.21.
6 Workmen's Compensation Board No. 28
Schedule 1 Benefits and Charges
The compensation and medical aid for Schedule 1 industries, including
estimates for what is still to be awarded for accidents happening during the year,
amounted to 813,239,244.31. There were other outlays of 81,421,261.83, being
8680,819.16 charged for administration expenses (including 8973.00 debit adjust-
ment of prior years' expenses), 8182,066.58 for other expenses of non-adminis-
trative character, 838,328.80 for mine rescue work, 8342.762.00 grants to accident
prevention associations organized under the Act, 8131,371.95 for the Board's
clinic, $8,221.37 for special treatment for paraplegics, $36,858.25 for the special
arrangements with the Toronto General Hospital, $284.12 for outlays under
Section 8 of the Act and $549.60 special expenses charged to the classes. The
total expenditures and charges for the year were $14,660,506.14.
Schedule 2 and Crown Industries
Schedule 2 industries are those in which the employer is individually liable
for accidents to his workmen. Dominion Crown cases under the Act by Do-
minion legislation, and Provincial Crown cases which are now under the Act,
are included.
The total amount awarded in Schedule 2 industries and Crown cases was
82,345,197.61, as compared with 82,555,764.16 during 1945. Of this $2,345,-
197.61, $1,033,962.68 was for Dominion Crown cases and $125,782.08 was for
Provincial Crown cases.
Administration Expenses
The gross expenses of the Board were 81,019,957.68, of which 8182,066.58
was for non-administrative services, that is those services which, mainly, medical
and investigatory, are in the nature of benefits rather than administrative. The
gross administration expenses are therefore 8837,891.10, of which 8679,846.16
has been charged to Schedule 1 and constitutes 4.80 per cent, of the benefits
awarded in Schedule 1.
The Accident Fund
The Accident Fund is comprised of Schedule 1 funds, and includes Current
Funds out of which temporary payments of compensation, medical aid, admini-
stration expenses, clinic and special hospital items are paid, the Silicosis Account,
Pension Fund, Disaster Reserve, Second Injury Fund, Compensation Deferred,
Investment Reserve, Contingent Reserve, and Operating Reserve, as well as
funds to complete claims (including pneumoconiosis claims) for which final
settlement has not been made.
The total amount held unexpended or due is $60,830,738.70 and is comprised
of investments of 859,504,176.08, 875,189.54 cash in banks, and 82,181,478.03
receivable (including $2,082,000.00 adjustments on 1946 assessments) less
8930,104.95 bank overdraft.
Pension Fund
The purpose of the Pension Fund is to take care of future payments of
pensions which have already been awarded. Actuarial tables, embodying the
contingencies of death and remarriage, have been compiled to show for each
age and kind of pension the average amount (sometimes referred to as capitalized
value) necessary to complete pension payments. When a pension is awarded
this average amount is transferred from the Current Funds to the Pension Fund.
All payments of pensions are made from the Pension Fund. Since the amount
transferred in any one instance is the average amount required, no re-transfer
is made should a residue be left at the expiry of the pension, nor is any additional
transfer made should the amount be exhausted before expiry of the pension.
General Review
The balance in (he fund at the coninicncenient of 1946 was $37,295,585.05.
During the year $6,708,444.80 was transferred for pension awards, $1,971,560.60
was added in interest and $3,536,806.30 was paid for pensions. The balance
in the fund at the end of the year was $42,438,784.15.
Disaster Reserve
The Disaster Reserve is a fund set aside under the provisions of Section
101 (2) of the Act to meet any unforeseen disaster or other circumstance which
might unduly burden the employers in any class of industry. The amount held
for this i)urpose at December 3l', 1946 was $909,997.41.
Second Injury Fund
The Second Injury Fund has been estal)lished to equalize the burden of
added loss from second injuries. The amount held in this fund, December 31,
1946, was $30,331.40.
Investment Reserve
The Investment Reserve is made up of excess over book values when invest-
ments are sold, and of interest received but not allocated to deferred obligations:
it is in the nature of a security reserve to protect the accident fund in the case
of default on bond or interest payments and to guard against loss by reason of
falling interest rates. The Reserve, December 31, 1946, amounted to $1,209, 907. 98.
Reserve for Compensation Deferred
The funds under "Compensation Deferred" comprise compensation moneys
held for claimants, pa\nient being deferred to a future time by reason of the
claimant being a minor or for other reason. The amount so held as at December
31, 1946 was $224,776.98.
Silicosis Account
This reserve is to pay claims for silicosis in Class 5 which have been made
but in which payments have not been made in full. The amount so held is
$2,844,141.10.
Reserve to Complete Claims
All continuing claims were evaluated at the end of the year and the amount
estimated to bring them to finality. Allowance was made for unreported and
unadjusted claims. The total amount was $8,860,535.82, of which $1,481,062.38
was specifically for pneinnoconiosis claims previously reported.
Contingent Reserve
During 1946 the Contingent Reserve, that is the amount allocated to take
care of expected contingencies, decreased from $5,141,398.83 at the beginning
of the year to $2,81 0.272.24 at \hc end of the year. The decrease is more apparent
than real, being due to transfer from contingent to definite status, with a cor-
responding increase in other accounts and reserves.
Under the Act artificial appliances are provided for the life of the workman
and this means, generally, se\'eral appliances for the one workman. Pensioners
require medical aid for var>-ing periods subsequent to pensioning, and sometimes
for life. Workmen, not pensioned, also require medical aid, especially when
their claims are reojiened. On reopening claims payment of compensation must
be made; and disabilities sometimes become greater with advancing age. There
is an accruing burden of cost in industrial diseases, especially for pneumoconiosis
and silicosis cases. Some pensions have been granted on wage loss and at some
Workmen's Compensation Board , No. 28
future date will be pensioned on the basis of disability. Future payrnents will
be made for past cases for rehabilitation. To meet these contingencies of the
future the Contingent Reserve has been established.
Operating Reserve
The Operating Reserve as explained above is that sum required to make
provision for cash expenditures, as assessments are not payable at once at the
beginning of the year, and in one sense is the surplus after all contingencies are
considered. This Operating Reserve is calculated at 10 per cent, of assessments
or $1,501,991.62.
From Commencement of Act
From January 1, 1915 when the Act first went into effect there have been
2,214,196 accidents reported to the Board, and $216,340,289.49 awarded as
benefits.
Dated at Toronto this 13th dav of March, 1947.
WILLIAM MORRISON, Chairman.
D. J. GALBRAITH, Vice-Chairman.
J. F. CAULEY, Commissioner.
Work Handled During 1946
STATEMENT OF RECEIPTS AND PAYMENTS DURING 1946
Schedule 1
RECEIPTS
Cash in Bankis 1st January, 1946:
Canadian Bank
of Commerce. S 9,462.06
Ro\al Bank of
Canada 42,186.23
S 51,648.89
Net Assessments, Penalties, Etc.:
Gross Assess-
ments 814,469,680.45
Under Section 8 33,642.62
Under Section 107 2,229.91
Under Section 1 14 431.77
From Depart-
ment of Vet-
erans AfTairs.. 24,224.31
From Accident
Cost Refunds 2,391.45
§14,532,600.51
Less:
Assessments and
Penalties Re-
funded 95,721.72
14,436,878.79
Silicosis Assess-
ments 5 371,468.06
Less Refunds.. 290.31
371,177.75
Interest:
Investments 2,139,318.01
Exchange Pre-
miums 5,427.96
82,144,745.97
Less: Interest on
Bank Over-
draft 14,691.49
2,130,054.48
Investments:
Principal Re-
turned — This
includes net
receipts only
on exchange of
certain invest-
ments 1,251,742.69
From Schedule 2 and Crown Em-
ployers:
For Administra-
tion Expenses,
account of
prior >ear,
paid out of
Schedule 1 in
1945 S 73,086.00
Less: Refunded 19.50
73,066.50
818,314,569.10
Bank Overdraft — 31st December
1946: Dominion Bank 930,104.95
819,244,674.05
PAYMENTS
Bank Overdraft — 1st January
1946: Dominion Bank
Compensation other than
Pensions and Deferred Com-
pensation
Pensions
Deferred Compensation
Rehabilitation
Medical Aid
Silicosis:
Compensation.. . . 8207,135.93
Medical Aid 30,014.70
Expenses 81,803.38
Under Section 8
Mine Rescue Work
Administration and other ex-
penses
Safet\- Associations
Clinic Expenses
Special Hospitalization:
(Toronto General
Hospital) 8111,240.00
Less: Amounts re-
ceived from Medi-
cal Aid and other
Accounts 95,831.00
81,364,340.23
4,724,647.54
3,536,806.30
154,095.54
4,728.10
2,328,934.94
318,954.01
284.12
36,503.62
1,024,127.91
326.440.00
1 25. IH). 14
15,409.00
813,960.387.45
Investments:
Securities for permanent in-
vestment—
This includes net payments
only on exchange of certain
investments 5,209,097.06
Cash in Banks, 31sl December 1946:
Canadian Bank
of Commerce . 8 19,809.61
Ro\al Bank of
Canada 55,379.93
75,189.54
819,244,674.05
10
Workmen's Compensation Board
No. 28
STATEMENT OF RECEIPTS AND PAYMENTS DURING 1946— Continued
Schedule 2
PAYMENTS
RECEIPTS
Cash in Bank 1st January 1946:
Imperial Bank of Canada . . S 89,307.24
Empiovers' Deposits under
Section 28 528,576.99
Employers' Deposits under
Section 32 1,598,368.31
Employers' Deposits for Claim-
ants' Mone\s
Interest:
Investments $154,186.61
Exchange Pre-
miums 135.50
Bank Deposits. . 484.76
Investments:
Principal Returned — Thisin-
cludes net receipts only on
exchange of certain invest-
ments
8,980.00
154,806.87
164,527.30
82,544,566.71
Claimants out of Deposits
under Section 28 S
Deposits returned to Em-
ployers under Section 28. . . .
Claimants out of Claimants'
Moneys
397,871.83
1,766.93
9,000.87
Paid out of Deposits under .Section 32:
Compensation 81,396,838.83
Rehabilitation 306.38
Medical Aid.. 146,659.44
1,543,804.65
23,356.50
374,391.87
Deposits Returned to Em-
ployers under Section 32.. . .
Investments:
Securities for permanent in-
vestment
Cash in Bank — 31st December 1946
Imperial Bank of Canada. . 194,374.06
82,544,566.71
(This is the statement referred to in the Auditor's Certificate).
Work Handled During 1946 11
ANALYSIS OF ADMINISTRATION EXPENSES AND NON-ADMINISTRATIVE
SERVICE OUTLAYS DURING 1946
Non-
Administration Administrative
Expenses Service Out- Total
lavs
Salaries of Board and Staff $582,689.86 8102,524.82 5 685,214.68
Travelling and Other Expenses of Board and Staff. . . 77,856.25 6,021.78 8.S, 878.03
Printing, Stationerv and Office Supplies 41,358.41 4,927.81 46,286.22
Postage and Excise Stamps 58,701.89 58,701.89
Telephone, Telegraph and Express 3,474.71 3,046.75 6,521.46
Legal Expenses, Witness F"ees, etc 437.71 437.71
Claimants' Travelling Expenses and Medical Exam-
inations 155.33 XF'S.M
Insurance and Security Service 6,165.54 3,896.98 10,062.52
Auditor's Services, under instructions of Attorney-
General 2,650.00 2,6.50.00
Office Rent 40,579.13 40,579.13
Permanent Equipment 14,432.04 360.67 14,792.71
Miscellaneous Services, Equipment Rental and Re-
pairs 7,671.87 1,413.12 9,084.99
Meals for Staff working overtime (nights, Saturda\
afternoons, etc.) 4.961.40 681.05 5,642.45
Contribution to Staff Pension Fund 55,950.56 55,950.56
5837,891.10 5182,066.58 51,019,957.68
Charged to Mine Rescue Work 5 1,825.18
Charged to Silicosis Account 56,507.95
Charged to Special Hospital Account 5,562.00
Charged to Clinic Accoimt 6,255,81
Charged to Safety Asstjciations 16,322.00
Charged to Schedule 2 Employers 33,492.00
Charged to Dominion of Canada 34,175.50
Charged to Province of Ontario 3,904.50
Charged to .Schedule 1 Emplo\ers 679,846.16
5837,891.10
12
Workmen's Compensation Board
No. 28
STANDING SCHEDULE 1 ACCIDENT FUND AS AT DECEMBER 31, 1946
ASSETS
Cash in Banks:
Canadian Bank
of Commerce. 819,809.61
Royal Bank of
Canada 55,379.93
S 75,189.54
Investments 59,504,176.08
Due for Administrative Expense:
From Schedule 2
employers 33,492.00
From Dominion
of Canada.... 34,175.50
From Province of
Ontario 3,904.50
71,572.00
Assessments estimated to be
due on adjustment of 1946
Pay Rolls 2,082,000.00
Accountable warrants held b>'
members of Staff 8,459.05
Salar\' advances to members
of Staff 40.00
Due from Staff for Canada
Savings Bonds purchases, in-
stalment plan terminating
Oct. 15, 1947 19,406.98
561,760,843.65
LIABILITIES
Compensation Awarded, pax-
men t deferred, other than
pensions S 224,776.98
Pension Liability ■.■.•-.■ 42,438,784.15
Balance at Credit of Silicosis
Account. 2,844,141.10
Compensation and Medical
Aid estimated outstanding. . 7,379,472.99
Estimated for Pneumoconiosis 1,481,062.83
Overdraft Dominion Bank.. . . 930,104.95
Assets in Excess of Liabilities:
Disaster Re-
serve 8909,997.41
Second Injurv
Fund '. 30,331.40
Investment Re-
serve 1,209,907.98
Contingent Re-
serve 2,810,272.24
Operating Re-
serve 1,501,991.62
6,462,500.65
861,760,843.65
Work Handled During 1946
13
STANDING SCHEDULE 2 FUNDS AS AT DECEMBER 31, 1946
ASSETS
C^i^li in Imperial Bank of
Canada S 194,374.06
Investments 4,095,574.42
54,289,948.48
LIABILITIES
Balance Employers' Deposits:
Under .Section 28 53,943,320.76
Under Section 32 114,977.64
Claimants' Moneys held bv the
Board ' '. . . . 16,974.25
Investment Reserve 214,675.83
54,289,948.48
NUMBER OF ACCIDENTS IN 1945 INVOLVING PAYMENT
Class
Medical
Aid Only
Temporary
Disability
I'ermanent
Disability
Death
Cases
Total
Cases
1
1,186
2,360
984
1,819
2,561
728
1,981
2,150
4,442
11,515
7,420
1,859
728
967
3,765
1,651
1,407
1,127
1,443
1,761
532
2,393
485
3,311
3,089
2,352
618
1,263
1,896
469
765
1,128
1,643
4,183
2,725
862
483
548
2,158
788
789
493
674
1,379
354
1,496
291
2,191
149
70
48
127
244
48
86
96
106
349
158
38
24
20
86 '
48
46
17
57
62
21
68
19
100
27
10
1
6
62
5
12
14
5
11
10
10
16
2
7
2
4
i
16
5
10
3
18
4,451
2 '
4,792
3
1,651
4
3,215
5
4,763
6
1,250
7
2,844
8
3,388
9
10
6,196
16,058
11
10,313
12
2,769
13
1,251
14
1,537
15
6,016
16
2,489
17
18
2,246
1,637
19
2,175
20
21
22
2i
24
3,218
912
3,967
798
5,620
TOTALS
58,575
32,637
2,087
257
93,556
ST
1
2.722
3,036
4,068
115
119
35
41
3,187
Crown
6,950
GRAND TOTALS
61.298
39,741
2,321
333
103,693
14 Workmen's Compensation Board No. 28
AUDITOR'S CERTIFICATE
14th February, 1947.
THE WORKMEN'S COMPENSATION BOARD OF ONTARIO.
Toronlo, Ontario.
Dear Sirs:
I have completed a continuous audit of the books of the Board for the year ended 31st
December 1946, and have obtained all the information and explanations I have required.
In m\ opinion, the attached statements of Receipts and Payments, Schedules No. 1 and
No. 2 trul\- and fairh- set forth the cash transactions of the Board for the year ended 31sl De-
cember 1946.
Bank balances at the close of the period ha\e been verified by direct communication with
the Board's bankers.
The amortized book value of the investments held by the Board as at the above mentioned
date was $63,599,750.50 and I confirmed by a physical examination the securities representing
these investments as at that date. Debenture principal due and unpaid at the end of the period
under review amounted to 573,762.27.
' Respectfully submitted,
A. G. CALDER, F.C.A.,
Chartered Accountant.
Work Handled During 1946 15
STATEMENT OF RECEIPTS AND PAYMENTS DURING 1946
Schedule 1
RECEIPTS
Cash in Banks, 1st January 1946:
Canadian Bank of Commerce S 9,462.66
Royal Bank of Canada 42,186.23
S 51,648.89
Net Assessments, Penalties, Etc.:
Gross Assessments SI 4, 469, 680. 4.S
Under Section 8 33,642.62
Under Section 107 2,229.91
Under Section 114 431.77
From Department of Veterans' Affairs 24,224.31
Accident Cost Refunds 2,391.45
$14,532,600.51
Less: Assessments and Penalties Refunded 95,721.72
14,436,878.79
Silicosis Assessments: S 371,468.06
Less: Refunds 290.31
371.177.75
Interest:
Investments. . S 2,139,318.01
Exchange I'remiums 5,427.96
S 2,144,745.97
Less: Interest on Bank 0\erdraft 14,691.49
2,130,054.48
Investments:
Principal Returned — This includes net receipts only on
e.\change of certain investments 1,251,742.69
From .Schedule 2 anu Crown Employers:
For Administration Expenses, account of prior \ear, paid
out of Schedule 1 in 1945 S 73,086.00
Less: Adjustments refunded 19.50
73,066.50
818,314,569.10
Bank Overdraft — 31st Dece.mber 1946:
Dominion Bank 930,104.95
$19,244,674.05
16 Workmen's Compensation Board No. 28
STATEMENT OF RECEIPTS AND PAYMENTS DURING 1946
Schedule 1
PAYMENTS
Bank Overdraft, 1st January 1946:
Dominion Bank S 1,364,340.23
Compensation Other Than Pensions and Deferred Compensation 4,724,647.54
Pensions 3,536,806.30
Deferred Compensation 154,095.54
Rehabilitation 4,728.10
Medical Aid 2, 328^934. 94
Silicosis:
Compensation S 207,135.93
Medical Aid 30,014.70
Expenses 81,803.38
318,954.01
Under Section 8 284.12
Mine Rescue Work 36,503.62
Administration and Oiher Expenses I,024!l27.91
Safety Associations 326,440.00
Clinic Expenses 125,116.14
Special Hospitalization:
Toronto General Hospital S 111 ,240.00
Less: Amounts received from Medical Aid and other
Accounts 95,831.00
15,409.00
$13,960,387.45
Investments:
Securities for Permanent Investment — This includes net
payments only on exchange of certain investments. . 5,209,097.06
Cash in Banks — 31st December 1946:
Canadian Bank of Commerce S 19,809.61
Roval Bank of Canada 55,379.93
75,189.54
519,244,674.05
Work Handled During 1946 17
STATEMENT OF RECEIPTS AND PAYMENTS DURING 1946
Schedule 2
RECEIPTS
Cash in Bank, 1st January 1946:
Imperial Bank of Canada $ 89,307.24
Employers' Deposits Under Section 28 528i576.99
Employers' Deposits Under Section 32 1, 5981368. 31
Employers' Deposits for Claimants' Monies ' 8[980.00
Interest:
Investments S 154,186.61
Exchange Premiums 135.50
Bank Deposits 484.76
154,806.87
Investments:
Principal Returned — This includes net receipts onh on
exchange of certain investments 164,527.30
S 2,544,566.71
18 Workmen's Compensation Board No. 28
STATEMENT OF RECEIPTS AND PAYMENTS DURING 1946
Schedule 2
PAYMENTS
Claimants Out of Deposits Under Section 28 S 397,871.83
Deposits Returned to Employers Under Section 28 1,766.93
Claimants Out of Claimants' Monies 9,000.87
Paid Out of Deposits Under Section 32:
Compensation S 1,396,838.83
Rehabilitation 306.38
Medical Aid 146,659.44
1,543,804.65
Deposits Returned to Employers Under Section 32 23,356.50
Investments:
Securities for permanent investment 374,391.87
Cash in Bank — 31st December 1946:
Imperial Bank of Canada 194,374.06
S 2,544,566.71
ONTARIO
DEPARTMENT OF AGRICULTURE
REPORT
OF THE
ONTARIO VETERINARY COLLEGE
1945
PRINTED BY ORDER OF
THE LEGISLATIVE ASSEMBLY OF ONTARIO
SESSIONAL PAPER NO. 29, 1946
ONTARIO
TORONTO
Printed and Published by T. E. Bowman,
Printer to the King's Most Excellent Majesty
1946
REPORT OF THE
ONTARIO VETERINARY COLLEGE
To TnK Ho.\ori{AHLK T. L. Kennedy,
Minister of Agnculliire
Sii{, —
I liave the honour to present herewith, the report ol' the Ontario Veterinary
College for the year extending from April 1, 1945 to March 31, 1946.
My predecessor, Dr. C. D. McGilvray, terminated his period of service
as principal after twenty-seven years of loj'al, faithful service.
STUDENT ENROLLMENT
During the academic year 1945-46 at the Ontario Veterinary College,
two hundred and thirty-seven students have been in attendance. One hundred
and twenty-six of this number were war veterans. As in the past, students have
enrolled from all parts of Canada. Their distribution by provinces is a>s follows:
Ontario — 158, Saskatchewan — 18, Alberta — 17. Manitoba — 13. British Colum-
bia— 12, Quebec 5. Prince Edward Island — 4, Nova Scotia — 3. New liruns-
wick — 2. In addition theie are four students from other parts of the British
('ommonwealth, namely two from British Guiana, one from Jamaica, and one
from I^nglaml.
The average age of the students in attendance is 24.6 years. There are
eight female students in attendance. Since June last, we have not accepted
female students, due to the large numl)er of applicants who have servt^l in
His Majesty's forces.
Certain structural changes in the present College building were necessi-
tated by the unprecedented number of veteran candidates admitted to the
first year class. A section of the freshmen class commenced the course of in-
struction Octol)er 2. 1945. B. section consisting of 40 veterans commenced
January 7. I94(». This latter group will complete their first year course of
instruction, June 30.
DEGREE OF DOCTOR OF VETERINARY MEDICINE
The senate of the University of Toronto approved a change of degree
conferred upon graduates on the successful completion of the course at the
Ontario Veterinary College. The graduating class (1946) received the degree,
Doctor of \'eterinary Medicine. D.V.M.
(iradvuites of the Ontario ^'eterinary College, holding the degree. B.WSc,
(Bachelor of Veterinary Science), can make application to the Registrar,
University of Toronto, for the new degree, Doctor of ^'eterinary Medicine.
Such applicants surrender all rights to the use of the degree, Bacheloi- of
Veterinary Science. A fee of ten dollars must accompany the application.
The entrance recpiircMnonts were raised, both for civilians and veterans,
and the college fees were increased slightly. The (^ntiance re(juirement,s,
fees and college rules are outlined later in this report.
REPORT OF THE No. 29
INSTRUCTIONAL STAFF
Dr. A. A. Kingscote and Dr. A. F. Bain returned from service in Hi.s
Majesty's forces and have resumed their respective duties in charge of Para-
sitology^ and Bacteriology. Dr. H. J. Griffiths was appointed to the Staff as
assistant to Dr. Kingscote in the Department of Parasitology and Fur-Bearing
Animals. Two new members were added to the teaching staff; Dr. J. P. W.
Oilman — Histolog}' and Embryology, and Dr. C. A. V. Barker — Breeding
Hygiene. Assistance was obtained from the following on a per lecture basis;
Dr. M. C. Dinberg, Provincial Pathologist, Ontario Department of Health —
Histology; Professor R. Birdwhistell, University of Toronto — Human Oeog-
raphy; Dr. D. S. Puffer, Assistant to the Chief Medical Officer of Health —
Public Health; Dr. L. Little — Public Health; Dr. A. E. Berry — Sanitary Engin-
eering. Dr. G. L. Bannister left the College Staff for service with U.X.N.R.A.
in China for a period of two years. Dr. Bannister seeks further experience in
communicable disease problems. It is expected that he will rejoin our staff
in two years' time.
The Staff has been heavily taxed due to the large number of students. It
has been found necessarj- to divide the first year class; instruction and labora-
tory periods, therefore, were given separately to the two sections. Further-
more, the marked limitation of space has hampered the progress of scientific
investigation. The addition of the new wing under plan at the present time will
alleviate this condition to some degree. However, this college will require an
additional small building for scientific research and virology. This institution
is also in need of further visual equipment for teaching purposes b}' wa}' of
lantern slides and film. A start has been made on the procurement of this
equipment.
CURRICULUM
The curriculum has been revised slightly. Additional time was allotted to
Biochemistry and Physiology. In the first year class, instruction in two subjects,
namely Pharmacy and Human Geography, has been added. In the second year
class, a course in Nutrition is given by Professor Evans of the O.A.C., Depart-
ment of Nutrition. In the third year class, a course of instruction in Swine
Diseases is given, apart from the general course in Diseases of Cattle, Sheep
and Swine. A separate twelve hour course has been given to Haematology. In
the final (fourth) year class, the periods usually allotted to the subject Meat
Hygiene, were revised this year so that instruction included meat and other
edible products; in consequence the course is now termed Food Hygiene.
Changes were made in the instruction given in Communicable Diseases. In
order to eliminate overlapping, communicable diseases of horses were taught by
the professor lecturing on equine diseases and communicable diseases of cattle
by the professor lecturing on cattle diseases. The subject Reportable Diseases,
consisted solely of instruction in diseases which are reportable under the Animal
Contagious Diseases Act. Furthermore, the final year students received a
lecture and clinical course in Artificial Insemination of 57 hours instructional
time. In the twenty-nine lecture periods devoted to teaching in Public Health
we have concluded a course of lectures in Public Health Bacteriology. Human
C<jmmuni('al)le diseases, also environmental sanitation and recreational sani-
tation. In the Bacteriology course, twelve hours were devoted to instruction
and demonstrations in A'irologv.
ONTARIO VETERINARY COLLEGE
DEPARTMENT OF EXTENSION
The facilities and .staff of this department have grown considerably during
the last few years; in consequence the activities and range of services offered
have greatly increased.
The department is divided into several divisions dealing with the major
agricultural problems relating to \'eterinary Medicine. Separate diagnostic
laboratories are maintained by the department to deal with Mastitis, Bang's
Disease (Contagious Abortion), Poultry Diseases, Swine Diseases and Diseases
of Fur Bearing Animals. A separate division also deals with breeding problems.
A small biological laboratory is maintained for making vaccines, sera and other
preventive biological products, as and when they are needed for the work of
the department.
The department, in the capacity of consultant, maintains close co-
oi)eration with the practising veterinarians throughout the province. In dis-
tricts where there are no practising veterinarians available, members of the
departmental staff deal directly with the Agricultural Representatives and
breeders of the district. Last year members of the staff addressed over sixty
meetings. The presentations made at these meetings included disease control
problems in poultry, cattle, swine, and fur-bearing animals. In the control of
Brucellosis, a province-wide calfhood vaccination programme was instituted.
A third project undertaken is the intradermal method of inoculation to deter-
mine its benefits, if any, over the subcutaneous method. Furthermore, the
merits of different methods of preparing vaccine are being surveyed.
The mastitis laboratory has been busily engaged and at present is under-
taking a survey in the milk sheds of one city. In the immediate future a second
survey will be undertaken in another city. In the department of parasitology,
a project is being undertaken in the control of parasitism amongst sheep on
Manitoulin Island, as well as several other investigational projects including
a stud}' of the toxicity of DDT. In the poultry laboratory, seven to eight
hundred birds are received monthly. Several investigational projects are
under way.
During the past year several new members have been added to the staff of
the Extension Department to facilitate maintenance and extension of the
services mentioned above; these include Dr. N. A. Fish in the Serological
Laboratory, Dr. D. A. Barnum, the Mastitis Laboratory, and Dr. A. Mac-
Kinnon, who has been engaged in both laboratory and field investigational
studies. A. G. Stewart, M..\., biochemist, has been added to our extension
branch staff.
SUBSIDIZED VETERINARY UNITS
The Department has assisted three municipalities in Northern Ontario
in the establishment of veterinary units, namely, Kenora, Algoma, and New
Liskeard, whilst preparatory organization work for the establishment of further
units has already been started.
On behalf of the members of the P'aculty I wish to exjM-ess appreciation of
the kind consideration and co-operation given by the Honourable the Minister,
the Deputy Minister and senior officers of the Department of Agriculture
throughout the year.
All of which is respectfully submitted.
(JupIdIi. Ontario, A. L. MacNabb
March 31, 1946 Principal
REPORT OF THE No. 29
DEPARTMENT OF EXTENSION
MASTITIS LABORATORY
F. W. SCHOFIELD, V.S., D.V.Sc.
A program having the dual purpose of an investigation and an extension
service for the control of bovine mastitis was a major project in this department
during the past year. Total number of milk samples received for laboratory
examination was 5,836. Between April and October, 1945, when the technical
methods for a large scale laboratory service were being developed, we examined
1,515 milk samples. In November, 1945, the laboratory staff was increased and
the extension service was enlarged. From November, 1945, to March, 1946,
we received and examined 4,123 milk samples which gave the following findings:
Streptococc us agalatiae 979
Streptococc us uberis 100
Staphylococcus a ureus 1 63
Corynehacterimn pyogenes 25
Escherichia coli 17
Aerohacter aerogenes 4
Paste wrella multocida 2
Streptococci other than mastitis strains 828
Negative for mastitis organisms 2,005
HERD BACTERINS
Continuing our observations on the use of herd baeterins in the control of
mastitis as recorded in last year's report, we prepared 40 autogenous baeterins
this year. The results obtained so far are in agreement with those reported
last year.
PENICILLIN DETERMINATIONS
Numerous estimations of the penicillin content of milk from infused udders
have been made.
Some observations made in the investigational aspect of oui- work on
mastitis were published in the March, 1946, issue of the Canadian Journal of
Comparative Medicine. (Penicillin in the Treatment of Bovine Mastitis, by
F. W. Schofield). The following are our conclusions reprinted from this paper.
1. That Streptococcus agalatiae infection of the bovine udder may be resistant
to penicillin when given in a unitage and fre(}uency sufficient to produce a
reasonable le^'el of inhibition. (No penicillin resistant strains have so far
been encountered.)
2. That acute mastitis, when due to either Staphylococcus aureus or Coryne-
bacterium pyogenes, shows moderate clinical improvement only, when
treated with penicillin, unless the treatment is commenced immediately
after the infection is established. With immediate treatment, the results
ma}' be highly satisfactory.
3. That the best results are obtained wlien an inhibitory level of penicillin
is maintained for three consecutive days.
ONTARIO VETER1NAI{Y COI.LKGE
That there i.s evidenee to .show that Slreplococcus agalactiac is more resist-
ant to penieillin in acute outbreaks of mastitis than when the organism is
present in Ihe udder unaccompanied by any clinical manifestations of
disease.
SEROLOGY (BRUCELLA LABORATORY)
X. A. Fish. D.V.M., D.V.P.H.
PREPARATION AND DISTRIBUTION OF BRUCELLA ANTIGEN
Seven thousand, seven hundred and fifty-nine test do.ses of Br. abortus
tube antigen were distributed to qualified veterinarian^ for the agglutination
test for Bi-ucellosis.
AGGLUTINATION TESTS
During the past year 99,152 blood samples were received at the Ial)oratory
which were submitted to the agglutination test for Brucellosis. This is an
increase of 14,458 blood samples as compared to the previous year. Included
in this number arc samples from cattle intended for export or exhibition
purposes, from calves in herds under supervised calf hood vaccination, and from
cattle in herds in prescribed areas as well as routine testing of individual herds.
Samples were also received from the herds at the Ontario Hospital farms, and
from herds under experimental adidt vaccination. The results of these tests
are shown in the table below .
BLOOD SAMPLES RECEIVED
for the Fiscal Year ending March 31, 1946
Tksi' Grovps
Blood
Sample?
Kkc'd
positivk
Samples
Doubtful
Samplks
Neg.\tivk
Samples
Samples
Broken or
Hemolyskd
No.
No.
%
No.
%
No.
%
No.
%
Routine Te.sts
55.237 11.797
27,070 23.368
6.737 204
S..523 301
1.066 712
519 92
21.36
86.32
3.03
3.53
66.79
17.73
3,567
1.324
270
391
48
37
6.46
4.89
4.01
4.59
4.50
7.13
39,426
2,041
6,191
7.816
304
389
71.37
7.54
91.89
91.70
28.52
74.95
447
337
72
15
2
1
.81
Calfhood Vaccination
Area Plan
1.25
1.07
Export
.18
Experimental Adult
Vaccination
Ontario Hospital Farms.. .
.19
.19
TOT.XLS
99,152 36.474
36.77
5,637
5.69
56.167
56.66
874
.88
ROUTINE TESTING OF INDIVIDUAL HERDS
This service is available for the blood testing of individual herds by
practicing veterinarians. The blood samples are submitted to the Brucella
laboratory by the veterinarians where the agglutination test is performed
and interpreted.
REPORT OF THE
No. 29
EXPORT SAMPLES
Provision is also made whereby blood samples can be drawn by accredited
veterinarians from animals intended for export or exhibition and forwarded
to this laboratory' for an official agglutination test. As shown by the table,
8,523 have been received and interpreted.
PRESCRIBED AREA TESTING
Supervised blood testing of herds in prescribed areas continues. During
the past year, 6,737 samples from cattle composing 262 herds have been sub-
jected to the agglutination test for Brucellosis. The results of the agglutination
tests on these samples are shown in the table.
SUPERVISED CALFHOOD VACCINATION
Progress continues to be made on supervised calfhood vaccination. At
present 6,291 herds are under supervision, an increase of 2,073 as compared to
the previous fiscal year. A total of 39,798 calves representing additions to the
above herds have been vaccinated with a live vaccine prepared from Brucella
abortus strain 19, and supplied free of charge by the Veterinarj- College to
qualified registered veterinarians in this province. Since supervised calfhood
vaccination was inaugurated a total of 92,401 calves have been vaccinated
with vaccine prepared and distributed by the College.
POULTRY DISEASES LABORATORY SERVICE
J. S. Glover, V.S., D.V.M.
This consists chiefly in the routine examinations of poultry sent or brought
to the laboratory. The number of specimens received during the past year, and
the conditions found, are shown in the following list:
Nature of Case Number of Cases
Pullorum 718
Omphalitis 225
Pullorum and Omphalitis 67
Pullorum and Ascariasis 5
Pullorum and Tuberculosis 2
Pullorum and Coccidiosis 3
Pullorum and New Wheat Poisoning 2
Pullorum and Staphylococcosis 1
Pullorum and Dermatitis 5
Pullorum and Ruptured Liver T
Pullorum and Capillaria Infestation 1
Pullorum and Visceral Lymphomatosis 1
.Pullorum and Riboflavin Deficienc}-. 2
Pullorum and Vitamin A Deficiency 3
Pullorum, Taeniasis and Roup 1
Omphalitis and Congenital Gout 23
Omphalitis and Coccidiosis 4
Congenital Gout 1
Nature of Case Number of Cases
Visceral Lymphomatosis 100
Visceral Lymphomatosis and Ruptured
Liver 1
Visceral Lymphomatosis and Fowl Pox, 1
Visceral Lymphomatosis and Coccidiosis 2
Visceral Lymphomatosis and Taeniasis. 2
Visceral Lymphomatosis and Ascariasis. 7
Visceral Lymphomatosis, Taeniasis
and Ascariasis .3
Visceral Lymphomatosis and Roup 1
Visceral Lymphomatosis and Pediculosis 1
Msceral Lymphomato.sis. Taeniasis,
Ascariasis and Coccidiosis 1
Osteopetrotic Lymphomatosis 2
Ocular Lymphomatosis and Taeniasis... 1
Coccidiosis 447
Coccidiosis and Ascariasis 18
Coccidiosis and Taeniasis 2
ONTARIO VETERINARY COLLEGE
Nature of Case
Number of Cases
Coccidiosis and Capillaria Infestation .. 2
Coccidiosis, Ascariasis and Taeniasis 1
Coccidiosis, Ascariasis and Capillaria
Infestation 1
Coccidiosis, Taeniasis and Capillaria
Infestation 4
Coccidiosis and Sinusitis 1
Coccidiosis, Ascariasis and New Wheat
Poisoning 1
Coccidiosis and Enterohepatitis 7
Coccidiosis and Pediculosis 1
Coccidiosis and Dermatitis 22
Coccidiosis and Coryza 1
Coccidiosis and Impacted Oviduct 1
Enterohepatitis 40
Enterohepatitis and Staphylococcosis. .. 1
p]nterohepatitis and Rui)tured Oviduct . 1
Staphylo(!occosis 35
Tuberculosis 37
Trichomoniasis 2
Hcxamitiasis 3
Ornithostrongylosis 1
Laryngotracheitis 8
Pasteureilosis 11
Enteritis (Cause not determined) . 74
Pericarditis 2
Pneumonia 19
Tumours 19
Ruptured Liver 18
Ruptured Oviduct 21
Ruptured Gut 1
Roup and Coryza 10
Injuries 25
Pullet Disease 4
Fowl Pox 15
Angiomatosis 1
Tracheitis 1
Paratyphoid 2
Laryngotracheitis and Roup 7
Impacted Gizzard 24
Impacted Gut 9
Impacted Oviduct 4
Impacted Crop 1
Nature of Case Number of Cases
Eversion of Cloaca 18
Subcutaneous Emphysema 1
Egg Bound 3
Torsion of Gut 1
Beak Necrosis 2
Chemical Erythema 2
Bumblefoot 1
Mouldy Grain Poisoning 1
New Wheat Poisoning 3
Coal Gas Poisoning 0
Favus 2
Ascites 1
Taeniasis 68
Ascariasis 70
Capillaria Infestation 37
Taeniasis and Ascariasis 28
Ascariasis and Capillaria Infestation 13
Taeniasis, Ascariasis and Capillaria
Infestation 1
Taeniasis, Ascariasis and Ruptured
Oviduct 1
Taeniasis, Ascariasis and Coryza 1
Taeniasis, Ascariasis and Fowl Pox 1
Taeniasis and Roup 1
Ascariasis and Roup 1
Ascariasis and Eversion of Cloaca 1
Ascaria.sis and Ruptured Oviduct 2
Ascariasis, Capillaria Infestation and
Ruptured Liver 1
A.sf-ariasis and Coryza 1
Capillaria Infestation and Ruptured
Liver I
A Avitaminosis 467
D Avitaminosis 153
E Avitaminosis 7
Riboflavin Deficiency 80
Thiamin Deficiency 20
Dermatitis 56
Nutritional Conditions in Addition
to Above 158
No Evidence of Disease or Putrid 223
Total 3.G29
PREPARATION AND DISTRIBUTION OF FOWL POX VACCINE
216,625 doses of vaccine were prepared and distributed for tiie vaccination
of poultry by the Johnson Stick Method for the prevention of Fowl Pox.
DISTRIBUTION OF PIGEON POX VACCINE
10.500 doses were distributed for use in flocks where cases of Fowl Pox
had occurred in a pen. This vaccine was not prepared here.
DISTRIBUTION OF INFECTIOUS LARYNGOTRACHEITIS VACCINE
57,()00 doses were distributed for the vaccination of poultry for the pre-
vention of laryngotracheitis. This vaccine was not prepared here.
10 EEPORT OF THE No. 29
REPORT ON SWINE DISEASES
C. E. Phillips, V.S., D.V.M.
Infectious rhinitis in swine (Bull Nose), has assumed major proportions
in Ontario, and is continuing to spread at an alarming rate.
This is an atrophic ihinitis, in many cnsos characterized by distortion
of the nasal bones, a disappearance of the turbinates and ethymoid bones
(softer structures), secondary pneumonias, and in all cases retarded growth.
AVhereas the average shoat should market within 200 days (about 7 months),
ihinitis infected pigs take from 7 to 10 months depending upon the type of
head and the extent of the damage. The larger amount of food and labour
required makes the raising of rhinitis pigs extremely uneconomical.
The high incidence of carrier animals and the tendency of some swine
breeders to dispose of shoats at communitj' sales to unsuspecting purchasers
before observable lesions show up, coupled with the breeding sow and boar
carrier problem has facilitated the spread of this infection. It is evident that
the majoritj^ if not all animals raised on infected premises, whether or not they
show observable lesions will spread the infection.
While the majority of infected herds are centered in and around Waterloo
and Wellington counties, we have observed the infection in Victoria. Middlesex
and District of Temiskaming and believe that it is undiagnosed elsewhere.
It should be kept in mind that not all infected animals show observable
nasal damage, a fact w'hich makes the inspection of a single breeding animal for
introduction into a herd, an impractical method of control. The entire herd
must be inspected for infection and even then the presence of rhinitis may not
be detected due to the fact that it takes from six months to one year for the
disease to become well established in a herd.
The literature would indicate that this is not a new condition, ha\ing been
present in Denmark and Germany for over 100 years; however, although some
investigational work has been conducted in Europe, the actual cause has not.
up to the present been established
It is interesting to note that an article from Sweden by Thunberg and
Carlstrom reports the spread of an infection similar to that in Ontario and as
reported from the Western provinces. According to this report the infection
was introduced into Sweden's breeding stock and has spread over the entire
countrj^ in a ten year period. Through the medium of various breeding experi-
ments they excluded the theory of heredity as the main etiological factor,
which view had been held by many of the earlier workers in opposition to that
of a possible infectious cause.
A paper on Infectious Rhinitis of Swine, constituting a report of the disease
in Ontario and the results of the investigational work undertaken at this college
up to that time, was presented at the Ontario Veterinary Association meeting
at Niagara Falls, January 25, 1946. This paper was also published in the
Canadian Journal of Comparative Medicine, February, 1946.
Laboratory and field investigational studies have been undertaken during
the past 3^car on various aspects of the infection:
(a) The incubation jjeriod.
OXTAPJO VKTKRIXARV COLLEGE
11
{])) The incidoiicc of carrier state.
(c) The interim time hi])se between damage to the nasal membranes from
the time of exposure.
(d) Causative agent or agents.
Througii the co-oi)eration of the Agricultural Kepresentati\e office, swine
herds have been available for field investigational .studies. At the college a
small laboratory has been set aside for the studies of swine diseases and an
experimental swine hoggery has about reached completion, in which investi-
gational woik will ])e continued.
In addition to the above, diagnostic and investigational^|^^^^^B)eeu
carried out and presentations of papers have been made atj|fl|^^^^^lng.-
Furthermore the diagnostic facilities of the College on porcin?^!fWi^P|iave
been considerably utilized by both veterinary practitioneis and swine breeders
as indicated in the following table.
PORCINE AITOPSY REPORT, 1945-46
Xaiurk or Cask
Enteric Disorders
Number of C.\si:!
Xa ri'Ri; OF Cask
NiMKKK OF Casks
Necrotic ICiiteritis 1!>
8;ilmonello.siR 2(1
Hemorrhagic Enterities 4
Ententes 3S
Constipation !)
Impacted Stomach 5
Gastro-enteritis 33
G;istritis 8
Ruptured Intestine , 3
Intestinal ()})struction 1
Entero-toxcmia 1.")
Scours 3
I-A'cess Iron 8
Pneumonias
Pasteurella
Pasteurella and Streptococci
Pasteurella and l)ronchi.sepficus
Bronchisepticus
Diptheriod
Pneumonia (unclassified)
Mechanical pneumonia
Streptococci
Influenza •..• 7
Post-faiTowinp; pneumonia 2
Miscellaneous
Rhinitis \'>
Toxic Sow milk 13
Staphylococci septicaemia 1
.lointill... 2
Peritonitis 4
Abscess 3
lirvsipelas I
Swine Pox -
Tetanus '
Anaphylaxis 1
Necrophorus (sore mouth) 2
Nutritional 15
.\naemia fi
4
2
2
1
1
Riboflavin deficicncy
Emaciation
Injury
Ascarids
I.ung worm
Nodular worm
Warts
Note. — The numbers listed in this table are not nece.ssarily indicative ot the actual numbers
of animals infected or fatalities due to the different conditiims.
The following are prints of photographs taken at the Ontario Veterinary
College and illustrate various stages of the development of rhinitis in pigs
that have been under pathological study at this college.
12
REPORT OF THE
No. 29
Fig. 1. Rhinitis pig, age 3' ■> months. Note wrinkled snout and dark
area below the eye.
Fig. 3. Cross section of Fig. 2 showing destruction of turbinates
and ethmoid bone.
ONI AHio vi:tkhixahy collegp:
13
I'iu. 4. Head of medium short nosed type showing damage.
Skull of normal and medium nosed pig showing distortion
of nasal bones.
14 REPORT OF THE No 29
DEPARTMENT OF ANATOMY
V. R. Browx, D.V.M.
Herewith I present the annual report for the Anatomy Department for
the year 1945-46.
Because of the large classes instructional work has consumed the greater
portion of our time. Additional assistance has been provided by Dr. J.
Ballantyne, Dr. D. Garrick and Dr. B. J. McSherry. Only the latter is, at
present, with the department. There is great need of one full-time assistant
and one part-time demonstrator during the College session.
; The total number of students enrolled in this course was 182, composed of
the first and second 3'ear classes. Each student would normally get twelve
hours per week of anatomy instruction but due to the large size of the first
year class it was necessary to divide it into two sections and consequently the
time was halved, giving six hours per week per student. It is not possible for
us to properly cover the subject with this limited number of hours and, further-
more, from the students' point of view it is impossible to assimilate and keep
up with this course along with others where time is equally short and instruc-
tion given in the same tempo.
In order to cover the subject in the allotted hours, lalioratorv guide sheets
weie prejiared and multigraphed. These serve as directions for dissection as
well as notes for study. Thus it was possible to cut down on the number of
lecture periods. The instruction so far completed deals with the horse, ox and
dog. A number of outline drawings are included in the above and the student,
while dissecting, fills in the detail thus making valuable notes for later review.
Investigational work has been carried on in a limited way. JMost of the
studies undertaken will require several years to complete l)ecause of the diffi-
culty in obtaining specimens of the stages of development. The Department of
Fur Bearing Animals has kindly turned over to us specimens of ova, embryos,
feti and adult foxes and mink after post mortem examinations were completed.
This is much appreciated and we hope to eventually ol:)tain specimens of all
stages in the development of these animals. The specimens received are care-
fully preserved for present or future study.
During the pelting season last fall, data were collected relative to average
body weights and measurements, ratio of bod}- weight to pelt weight, measure-
ments and capacities of the various parts of the respiratory, digestive and
vu'ogenital systems of both sex of mink. This work is based on examination of
over one hundred specimens, many of which were i)reserved for further study.
During the winter and spring considerable work has been done on the
osteology, myolog}^ and splanchnolog^y of normal mink. Photographs and line
drawings were made as each region was woiked over.
A numbei- of casts to show the circulation in the kidneys, li\ers, .spleens,
feet and cephalic parts of horses, cattle and dogs were prepared by making
injections of coloured liquid plastic solution into the arteries and veins. The
part was then immersed in concentration hydrochloric acid to digest off the
ONTAPJO \K'rERINAH\ COI.LJXW;
tissues thus leaving an accuiatc model of the xessels. These are \'alual)le tor
teacliing and we hope to eventually complete a collection from all animals.
We luive been fortunate to receive from practitioners a number of bovine
monstrosities for anatomical studies. To date there arc in our collection several
ivvo-headed monsters, two with ectocordis, two with congenital l)od>' fissures,
(jne schistoeephalus ))ifidus and one with absence of fore limbs. In the case of
the latter, the right fore limb was represented by only a small flap of skin and
tlie left was nine inches long and quite rudimentary. These specimens have been
dissected, photographed and the date recorded. The most interesting parts
are ])resei'ved for future study and as permanent specimens.
16
REPORT OF THE
No. 29
DEPARTMENT OF HYGIENE
(BACTERIOLOGY)
A. F. Bain, V.S., B.V.Sc.
The department is mainly employed in teaching. Students of the third
and fourth years are instructed in bacteriology by lectures and in the laboratory.
During the past academic j-ear the laboratorj' time allotted to bacteriology
has been increased. The additional time has been used for increased instruction
in serology and immunology.
In addition to teaching, the department conducts routine examinations
of specimens submitted for bacteriological diagnosis. A summarj- of the speci-
mens examined during the past year is appended:
Cattle
Sheep
Horses
Swine
Dogs
Cats
Mink
Fox
Rab-
bits
Past. Infection
s
1
5
1
1
1
2
16
Past, and Strepto-
coccus Infei"tii)ii
1
Bronchisepticus
Infection
1
^ • pyogenes Infection.
Pyelonephritis
3
4
2
1
1
1
7
4
Streptococcus Infection
Infiuenza
3
1
6
1
1
Calf Septicaemia
Salmonella Infection
2
4
2
2
1
1
2
9
Necrotic Enteritis
1
Scours...
4
6
4
Calf Pneumonia
6
Anaemia
1
1
Blackleg ...
4
1
4
3
4
CI. Septique Infection.
Actinomycosis
1
4
Actinobacillosis
3
Pulpy Kidney
1
1
Bang's Disease
2
2
Fistulous Withers
3
3
Mastitis
12
1
12
Xecrophorus Infection
I
9
Distemper
1
1
2
Malignant Catarrh
1
1
Feline Enteritis
2
2
Granular Vaginitis
Warts
2
2
2
1
3
Parasitism..
3
3
2
8
.")
Miscellaneous
27
3
2
3
2
1
49
loo
ONTARIO VKTERIXAin' COIJ-KCi; 17
DEPARTMENT OF HISTOLOGY
G. P. W. (llLMAX. \ .S.. IlV.Sc.
Tho woik of this {Icpartment consists almost exclusively of teaching;
histology and embryology to first and second year students. The total
number of under-graduates taking instruction in this department during the
current year, was 182. Each student recei\ed 5 hours lecture and laboratory
work per week during the Fall teim and 4 hours during the Winter term.
Dr. Dinberg, Provincial Pathologist lectured for 2 two-hour periods a week,
his services being loaned by the Ontario Department of Public Health, during
the academic year (October to .\piil inclusive.)
Due to the lack of spac(; in the main \'eterinary College building, a tem-
porary laboratory was set up in the Daiiy building of the O.A.C. Because of the
abnormally large classes it was found impossil)le to gi\e (>ach student the
individual attention in his laljoratory work that he should have received. This
year in order to attempt to offset the above mentioned handicaps and due to
the lack of a much needed full time demonstrator to help in laboratory instruc-
tion, extensive use had to be made of medecrome lantern slides, models and
prepared demonstrations.
During the 3^ear a certain number of histological sections weie prepared
by the department, however almost the whole histology slide library needs
replacing. Foi- this and other work a technician is badly needed. Also the lack
of a separate work laboiatory and permanent fixtures has hampered to a great
extent this line of work.
A very limited amount of in\('stigational work was started this wintei- in
the field of genetics. This work concerns the study of hereditary abnoimalitics
and congenital malformations in swine. As the problems being pursued are in
the nature of long range pi-ojects, conclusive results are nf)t expected for
several years.
Co-operation has been extended to the other departments when it has been
requested or required. In particular contact has been maintained with the
departments of Anatomy, Physiology and Pathology.
18 PvEPORT OF THE No. 29
DEPARTMENT OF MEDICINE
R. A. AIcIxTOsH. B.V.Sc. M.D.V.
The work of this department consists in teaching materia medica, thera-
peutics, diseases of cattle, sheep, and swine, obstetrics and breeding hygiene,
and the aj^pHcation of all means medicinal, surgical or otherwise for the pre-
vention, treatment and control of such conditions. There is also a considerable
amount of extension work in the form of investigational \isits to determine the
nature and cause of outbreaks of disease and, upon occasions, in a consultant
capacity with practicing veterinarians.
During the summer of 1945, Dr. C. D. McGilvray. the formei- principal of
the Veterinary College, retired and Dr. A. L. MacNabb was appointetl to the
position. Following Dr. ^NlacNabb's appointment. F. E. Wagner was added
to the staff to teach the subject of pharmacy and C A. \'. Barker to teach
obstetrics, breeding hygiene, and assist with clinical work in cattle, sheep,
and swine. C. E. Phillips took over the lectureship on diseases of swine and
also did a considerable amount of investigational work in connection with
outbreaks of disease in that species of animal. While this assistance spread the
work of the department somewhat, nevertheless, owing to the increase in the
size of the freshmen and sophomore classes, and the fact that elementary clinical
instruction was given to these classes, the amount of work was not reduced.
This department also has the responsibility of the veterinary service required
for the livestock of the Ontario Agricultural College.
In connection with the clinical material handled by this department, a
survey of the records reveals that there were 152 cattle cases in the clinic. Of
this number, 42 were representative of conditions and services rendered in
herds or lots of calves to the number of 745. In swine, 97 cases passed thiough
the clinic and of this number, 26 were representative of diseases in swine herds
and litters of young to the number of 1,247. In sheep there were 29 cases in the
clinic and of this number, 14 were representative of flocks and lambs to the
number of 1,375. Horse cases to the number of 21 were also handled by this
department and in addition, Kil tests for pregnancy Avere conducted.
The extension service consisted of 15 investigational visits to examine
herds in which outbreaks of diseases and breeding difficulties had occurred.
A number of trips in a consultation capacity with practicing vcteiinarians were
also made. Cobalt was mailed to 35 farm addresses for cattle suffering with
apparent deficiency of that element. Protamone was forwarded to veterinarians
to be used on barren and slow working bulls. Ascorbic acid solutions were
mailed to a number of veterinarians for use on shy breeding cows. A great
many letters of inquiry are answered from this department regarding disease
conditions affecting livestock. At the request of a few of the Agricultural
Representatives, ten addresses were given at Junior Farmer ^Meetings. At live-
stock meetings held by the breed organizations, six addresses were given.
OXTARTO VKTERINAK\ COLLEGE 19
DEPARTMENT OF PARASITOLOGY AND
FUR BEARING ANIMALS
A. A. KiNGSCOTE, V.S., J).V.Sc.
The Department of Parasitology and Fui- Bearinfj; Animals has undergone
considerable reorganization during the fiscal \ear.
Prior to January 1945, the entire responsibility of lecturing and routine
work, associated with Fur Bearing Animal Diseases, Protozoology, Entom-
ology and Helminthology fell to Dr. A. H. Kennedy, who, in addition to
lecturing in these four courses, conducted autopsies, prepared vaccines, and
held an appointment as Dean of Residence. This multiplicity of responsibilities
was the result of a wartime necessit3^ At the conclusion of the 1945 Spring
term, Dr. Kennedy was taken seriously ill. Essential duties, consisting of post
mortem examination and laboratory tests, were conducted by Dr. F. W.
Schofield and Dr. A. F. Bain, otherwise the department \iitually ceased to exist
duiing the summer of 1945 and until Dr. Kennedy's return.
At the beginning of the New Year, 194(3, Dr. A. A. Kingscote, who had
been pre-war lecturer in parasitology at the college was released from overseas
ser\ice and appointed head of the dei)artment.
.\ further increase in staff followed with the release of Dr. H. J. (Griffiths
from special scientific duties in the Royal Canadian Army Medical Corps.
Two non-technical staff members consisting of i)art-time term and full-
time summer student help, were made available. In addition, much needed full-
time stenographical assistance materialized toward the end of the fiscal yeai'.
As the departmental staff became available, the duties were divided among
the members with the object of creating more efficient teaching methods, and
more i)romj)t and efficacious extension services.
Fur Bearing Animal recjuirements were majored and by the beginning of
February 1946 became Dr. Kennedy's sole technical responsibility in regard to
teaching and extension work. Dr. Kennedy has now a full-time student assist-
ant and a part-time stenograi)her to render the ever increasing services deman-
ded by the growing Ontario Fur Industrv (1,200 farmers in the Piovince).
Work in parasitology-, both teaching and applied, was sub-di\ided under
its three main divisions namely protozoology, entomology and helminthology.
Dr. Griffiths was allotted full responsibility for teaching and conducting all
routine and research work in helminthology. Similar responsibilities were
assumed foi- i>rotozoology and entomology by the iiead of the department.
PARASITOLOGY
Courses in these sul)jects were given to the second, third and fourth
year students. These courses consisted of lectures and demonstrations, which
were collectively designed to give the students a knowledge of the diagnosis
and control of protozoan, arthropod and helminth diseases of domestic animals.
20 REPORT OF THE No. 29
Routine duties in connection with parasitology consisted of making
autopsies, collection of teaching materials, and the examination of fecal and
skin lesion samples. Research projects were started early in 1946 to establish
the tolerance and toxicity of DDT in turkeys. The value of this new insecticide
was ascertained in regard to its ability to destroy isopods. crustacean inter-
mediate hosts of poultry parasites. The symptoms of DDT poisoning in birds
were established. Work on blackhead and avian coccidiosis has been started
and is still in progress. Extension projects initiated during the year, and which
are now under development concern turkey parasite control generally and
sheep parasite control on a county scale.
GENERAL
Outlines of all lecture courses on fur bearing animals, protozoology,
entomology and helminthology have been revised.
A considerable amount of scientific equipment has been added to the
department and has improved greatly the facilities for teaching, research and
routine work.
The outline for teaching, research and extension work has been completed
in detail for the ensuing year. Projects have been initiated to complete the
revision of all lecture notes and the building up of museum specimens, lantern
slides, and microscopic and demonstration specimens to meet the greatly
increased student enrollment for the coming vear.
FUR BEARING ANIMALS
Arnold H. Kennedy, B.S.A., V.S., D.V.M., D.V.Sc.
In the past fiscal year the work has steadily increased and has been con-
ducted under the following headings:
1. Diagnostic Work
During the above mentioned period 110 post-mortems were made upon
fur-bearing animals. Tissues were prepared for microscopic examination, diag-
nostic purposes and study. Treatments were advised in all cases where disease
necessitated control measures. The following table indicates the number of
the various species of animals examined for disease and the diseases affecting
them. In the majority of these cases, where only one animal was examined for
diagnosis, the condition represented a number of animals being similarly
affected on the ranch.
ONTARIO VKTKRINARY COLLKGK
21
TABLE I
REPORT OF POST MORTEM EXAMINATIONS MADE ON
FUR BEARING ANIMALS
from October 1, 1945 to March 31, 1946
Rabbits
X
c
M
;£
K
S
<
a
e
.J
ft,
■<
<
i<i
0
H
JS
^
Z
^
55
H
zz
^
, ,
■■1
-^
n
■"
'"'
21
OS
< 5
J •< 00
>J u »
aaa <
£ s C
Pneumdiiia
Food Poisoning
Distemper
vStreptococcic Infection .
Boils
Bacterial Infections
Tuberculosis
Nephritis
Jaundice
Tail Chewing
Nutritional Anemia
Throat Infection
Eye Infection
Cystic Calculi
Parasites
Convulsions
Abscess
Indigestion
Ear Canker
Diarrhoea
Undiagnosed
Putrid
Identification
Totals.
16
93
26
20
12
1
5
2
3
10
1
3
10
2
2
1
1
1
1
1
1
1
2
9
1
116
2. Extension Work
Service under thi.s heading consisted of visiting ranches and discussing
fur farming prol)iems and their troubles with the owners; attending regional
meetings, addressing fur farmers' meetings, the examination of animals for
freedom from disease at the live animal fur shows and the answering of
correspondence relative to fur farming.
3. Investigational Work
As time permitted, and materials became available, various diseases
affecting fur-bearing animals were studied. Case histories were recorded in
detail. Bacteriological and pathological examinations were made when neces-
sary. Photographs and drawings have been made, filed and recorded on
diseases.
4. Biological Products
7,382 doses of formal tissue vaccine for mink were i>rei)ared. 1,000 doses
were imported fiom the Fromm Laboratories, Grafton, Wis., U.S.A. A total
of 8,382 doses have been available for distribution to ranches in Ontario.
5,512 do.ses of formal tissue vaccine for mink were distributed to veterinarians
throughout Ontario for immunizing and treating mink foi- distemper. 200
REPORT OF THE No 29
treatments of distemperoid vaccine were procure-d and kept on hand for
immunizing foxes against distemper. To date, 200 treatments have been dis-
tributed to veterinarians for immunizing foxes against fox distemper. 2,200 cc.
of autogenous bacterin were prepared and distributed to veterinarians for
immunizing and treating foxes against bacterial infections that have occurred
on fox ranches in Ontario.
5. Tutorial Work
A course on fur bearing animal husbandry and diseases was given to
the senior class at the college. A scholarship has been made available for a
student chosen from the graduating class to pursue studies on fur bearing
animals.
6. The following table gives a summary of the number of species of animals
and the diseases with which they were affected.
ONTARIO VETEKIXAKY COLLKGK
2\
TABLE II
A DETAILED REPORT OF THE PROBLEMS ENCOUNTERED IN FUR BEARING
ANIMALS TO WHICH ATTENTION HAS BEEN GIVEN
from October 1, 1945 to March 31, 1946
1
Rabbits
'<
■A
1
X
■A
1
DlSKASBS
<
K
0
■J
X
<
a.
a
a
u
e
a
»
X
6
s
z
X
O
£
•<
m
X
6
o
H
<
>
d
•<
<
%
Control of Distemper 3j 20
1 ! 1
23
43
37
17
lOl 5
1
2
15
204
Hoils
6
6
Pneumonia
1
15
1
23
4
10
2
1
2
iT
1
3
1
1
2
2
2
20
Parasites
1
Food Poisoning
1
24
Feeding
'
1
2
7
Feeding Meat
Tuberculosis
1
1
1
11
3
Chronic Nephritis
Deficiency Diseases
'
2
2
Inoculating
1
12
Bacterial Infections
1
Tail Chewing
3
Mites Affecting
1
Trappine
4
3
5
Short Course on
1
1
6
.laundice
1
Hormones
1
2
T
1
Depraved Appetite
2
Purchasing of
1
2
4
1 )igestive
Disturbance
1
1
Anatomical Structure
of
1
1
4
2
'I'anning Skins
4
Animal Musk
4
4
Tissue Vaccine
2
4
1
1
16
2
1
3
2
Autopsies
4
1
Anaemia
1
7
2
2
Pictures of
23
Kidney Conditions ..
Breeding Troubles
4
1
Skin Conditions
3
Snuffles
1
1
Shipping of Mink
1
1
Tularemia
1
1
Identification of
1
1
Diarrhoea
2
2
Far Canker
1
1
Mating of
2
2
Bulletins
3
3
Artificial
Insemination
I
1
2
1
1
1
Mouldy Meat . ..
1
Cvstic Calculi
2
Nursing Sickness
1
Medicinal
Preparations.
1
2
l']tiquiries Answered
2
2
Totals
30
215
47
43
18
11
9 1
2! 331 2
411
24 REPORT OF THE Xo. 29
DEPARTMENT OF PATHOLOGY
F. W. SCHOFIELD, DA\SC.
TEACHING
The chief function of this department is the teaching of Pathology. This
involves the preparation of tissue for studj^ of both gross and microscopic
pathoIog.y. During the 3'ear over thirty class sets of sections were prepared and
sixty mounted specimens were added to the museum.
INVESTIGATION
The services of this department are always at the disposal of the veterin-
ar3' practitioner and the livestock industry for the investigation of unusual
diseases occurring among the domestic animals.
During the current year investigation was made into a number of out-
breaks of disease, the most interesting of which were:
Salmonellosis in Cattle (Sal. typhimurium)
Parasitism in Sheep
Congenital Deformity of the Mandibles in Chinchillas
]\Ialignant Catarrh of Cattle
Granular Vaginitis of Cattle
Infectious Keratitis of Cattle
Toxaemia of Calves
PATHOLOGICAL LABORATORY SERVICE
This involves the routine examination of tissues received from veterinary
practitioners and the post mortem examination of carcasses and portions of
both large and small animals. There were 448 specimens received this year.
These required the preparation of over 2,000 tissue sections. The variety of
such specimens is shown in the following table:
ONTARIO \i:terixai;\ ( ()Lli:gi;
Disease
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15
2
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9
1
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10
1
16
2
2
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1
1
1
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3
3
4
14
1
1
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2
5
5
1
1
26
16
12
2
2
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4
4
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5
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1
1
5
1
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1
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IS
12
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1
1
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2
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2
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2
2
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2
1
9
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1 Juephalitis
Kncephalo-myelitis
Paraplegia
Genito-Urinary System
Nephritis — acute
2
3
3
3
2
1
2
1
1
1
3
1
5
" chronic
2
" embolic
4
3
4
1
6
" pvelo
1
2
4
" sub-acute glomerular
1
7
Nephrosis
1
1
Orchitis
1
2
1
2
Pulpy Kidnev
2
4
\ aginitis
3
O
26
REPORT OF THE
No. 29
Disease
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Blood and Blood Forming Organs
Anaemia
1
1
o
1
Lucosis
5
Leukemia — Ivmphatif
1
Leukemia — Spleno-Medullarv
1
1
10
2
1
Heart and Circulatory System
Brown atrophy
1
Degeneration ...
1
11
Myocarditis acute
?
vSkin and Sub-cutaneous Tissue
Inflammatory — acute
2
1
?
Inflammatory- — chronic
1
Liver
Abscess
2
2
1
1
1
1
1
9
Cirrhosis
2
4
s
Cholecystitis
1
Congestion — Passive
2
1
3
Degeneration — Fatty
1
3
Focal necrosis
3
1
1
]
1
ft
Hepatitis — chronic.
9
Infiltration— Fatty
1
1
1
?
Gastro Intestinal Tract
Enteritis — acute
2
1
A
Enteritis— necrotic
1
Gastritis — chronic
1
7
2
6
2
3
Special Diseases
Actinohacillosis
7
Actinomycosis
1
3
Coryne bacterium Inlection..
f.
Deficiencj — iron
1
1
Deficiency — phosphorous
2
9
Entero-hepntitis
2
2
4
Johne's Disease
1
1
1
Malignant Catarrh
1
Parasites
2
?
Poisoning — strj'chnine
1
1
Rhinitis
15
lo
Salmonellosis
4
7
4
Septicemia
2
1
9
Streptococcus Infection
1
Swamp Fever
4
4
Tuberculosis
20
9
141
3
4
16
?3
Miscellaneous
1
12
14
32
2
36
2
179
n!
10
lo'
2
7
1
4n
Totals
1
3
448
ONTARIO VETERINARY COLLEGE 27
DEPARTMENT OF PHYSIOLOGY
II. T. Hatt, D.V.Sc, PhD.
The work of tliis (icpartmcnt is concerned with teaching the phy.siology
ot domestic animals, and teaching the clinical chemistrj' of domestic animals
to undergraduate students in the Ontario Veterinary College. Some investi-
gational work is also done, but this, at pre.sent is subsidiary to the instruc-
tional woi'k.
Due to the great influx of students, the teaching and investigational work
of this department are, at present, hampered by lack of equipment, facilities,
and specially trained assistants, for example — the laboratory accommodation
only permitted a portion of the class to attend at one time. The laboratory
work with the first year was repeated eight times, and with the second year,
twice. However, conditions in these regards are improving, and it is confidently
expected that, upon completion of the, at present planned, construction at the
College, these deficiencies may l)e remedied.
The total teaching load of this department consisted of the delivery of
203 one-hour lectures, the preparation and supervision of 60 three-hour labora-
tory periods, the setting and holding of 1 1 examinations, and the marking of
928 examination ])apers. This load was distributed as follows:
PHYSIOLOGY
The first year class, totalling 148 students, received 87 one-hour lectures,
and spent 4 three-hour periods in the laboratory, 12,896 student-lecture hours
and 1,776 student-laboratory hours — a total of 13,672 student-teaching hours.
Four examinations were held during the course of instruction.
The second year class of 48 students received 87 one-hour lectures and
pent 3 one-hour periods in the laboratory, a total of 4,176 student-lecture
hours and 1,008 student-laboratory hours. Four examinations were held during
the course of instruction.
The teaching schedule for physiolog}' thus included the deliver}^ of 174
one-hour lectures, the preparation of and supervision of 46 three-hour labora-
tory periods, the holding of 8 examinations and the marking of 784 examina-
tion papers.
CLINICAL CHEMISTRY
The second year class, 48 students, received 29 one-hour lectures and
spent 7 three-hour periods in the laborator}^ 1,392 student-lecture hours and
1,008 student-laboratory hours, a total of 2,400 student-teaching hours. Three
examinations were held during the course of instruction, 144 examination
papers written.
The teaching schedule in clinical chemistry thus included the delivery of
29 one-hour lectures, the preparation and supervision of 14 three-hour labora-
tory periods, the holding of 3 examinations and the marking of 144 examina-
tion papers.
ANNUAL REPORT
OF THE
Department of Highways
ONTARIO
FOR THE FISCAL YEAR ENDING MARCH 31st
1946
PRINTED BY ORDER OF
THE LEGISLATIVE ASSEMBLY OF ONTARIO
SESSIONAL PAPER No. 32. 1947
ONTARrO
TORONTO
Printed and Published by T. E. Bowman. Printer to the King's Most Excellent Majesty
1947
CONTENTS
Page
Highways of Ontario, by J. D. Millar, Deputy Minister 8
Report of Highways Accountant, by John Smith, Accountant 10
Report of Gasoline Tax Revenue, by J. H. Robinson, Chief Inspector 10
Report of Miscellaneous Permits Branch, by C. G. Fairs, Supervisor 12
Report of King's Highway Operations, by A. A. Smith, Chief Engineer 16
Report on Bridge Construction, by A. Sedgwick, Chief Bridge Engineer 31
Report on Municipal Roads, by J. A. P. Marshall, Chief Municipal Engineer 32
Appendices:
1 . Expenditure by Counties and Districts 42
2. Gross Expenditure by Roads 62
3. Schedule of Assumptions and Reversions 64
4. Bridges Completed on King's Highways During 194.5 66
5. Growth of County Road Expenditures and Provincial Grants 68
6. County Road Mileage and Expenditure 69
7. Summary of County Road Expenditures 70
8. Summary of Road Expenditures in Organized Townships 72
9. Mileage of Road Surfaces at the End of 194.5 74
10. Graphs Showing Rise and Fall in Total Approved Expenditures by Organized Munici-
palities and in Government Subsidies by Calendar Work- Years from 1920 to 194.5
Inclusive 76
Report of Motor Vehicles Branch, by J. P. Bickell, Registrar 77
[2]
Di
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2
To The Honourable Albert Matthews, LL.D.,
Lieutenant-Governor of the Province of Ontario.
May it Please Your Honour: —
The undersigned has the honour to transmit the Annual
Report of the Department of Highways, Ontario, for the fiscal
year ending March 31st, 1946.
Respectfully submitted.
Geo. H. Doucett,
Minister.
Department of Highways, Ontario,
Toronto, March 30th, 1946.
[4]
To The Honourable Geo. H. Doucett,
Minister of Highways, Ontario.
Sir:—
I have the honour to present herewith Report on the activi-
ties of the Department of Highways for the Fiscal Year ended
31st March, 194().
The Report covers operations and functions performed by
the various branches, including King's Highways, Municipal
Roads, Bridge Construction, Accounting, Gasoline Tax and
Motor X'ehicles.
I have the honour to be, Sir,
Your obedient vServant,
J. D. MiLL.^R,
Deputy Minister.
Department of Highwavs, Ontario.
Toronto. March 3()th, l!t4().
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HIGHWAYS OF ONTARIO
By J. D. Millar, Deputy Minister
In the period covered by this Report for the fiscal year ending March 'M,
1946, some of the outstanding events of history were taking place. The collapse
of the German armies in May, 1945, was followed by the announcement of the
atomic bomb in August and the subsequent surrender of Japan in September.
With the victorious ending of World War II, the Department began the task
of setting in motion the work of post-war rehabilitation of the highway system.
As the summer construction season was nearly at an end, only a limited amount
of new work could be started. During the winter of 1945-46 the most essential
projects were chosen and plans completed for the coming year. Staff members,
returned from the armed forces, brought a wealth of technical knowledge of new
construction methods developed during the war.
As will be noted in the report of the Chief Engineer, the bulk of the 1945
work on the King's Highways was directed to maintaining road surfaces and
little new grading or bridge construction could be undertaken.
Reviewing Department reports of the fifteen years which have elapsed since
1930, several outstanding features are evident: the increased attention given to
subgrade conditions and the base materials under pavements predominate.
There are two reasons for this; first is the increase in the number and weight
of commercial vehicles and, second, is the greatly extended snow ploughing
done throughout the Province. Where a coating of snow formerly protected
highways from deep penetration of frost, this snow has been removed in recent
years and many cases are reported of seven to eight feet of frozen soil under
pavements. It frequently requires three months warm weather to bring out this
frost and !n the interval the subgrade is wet and unstable. Careful attention is
paid to locating soils subject to frost action and correcting heaving and failure
in the spring months.
The maintenance of the King's Highways was still hampered by lack of
machinery and manpower. An increasing number of motorists, returning to the
road after gasoline rationing was lifted, were meeting for the first time the results
of wartime deterioration of road surfaces. Their understanding of the Depart-
ment's problem and their patience in accepting temporarily a much lower
standard is greatly appreciated. Attention is called to the number of traffic
control installations nov/ in operation in various parts of the Province. In
preparation of engineering studies, increasing use is being made of automatic
traffic counters. The planting of permanent snow hedges was extended and
results of these experiments are proving very satisfactory.
The revenue of the Department increased slightly over the previous year
due chiefly to the lifting of gasoline rationing. Expenditure was also higher with
increased subsidies being paid to the Counties and Townships. As these latter
cover the calendar year from January 1, 1945, to December 31, 1945, the in-
creased costs of heavy snow removal in the winter of 1944-45 are included. The
following comparative figures indicate the excess of revenue over expenditure
in the period since the outbreak of war:
[8]
Approximate Approximate
Year Revenue Expenditure
1939-40 » ;i4,000.()(K) S 32,0(K),000
1940-41 3(),00(),(M)() 2«,300,000
1941-42 3S,()()(),()(M) 3o,o00,000
1942-43 32,.")0(),()(M) 19,800,000
1943^4 30,800,000 19,200,000
1944-45 36,500,000 18,600,000
1945-46 37,300,000 22,900,000
Seven-year Totals $ 251 ,100.000 $ 174,300,000
With the removal of the rationing of gasoHne, the permit system for sale of
gasoline exempt from gasoline tax was no longer possible unless the Province
was prepared to take over the marking or colouring of tax-free gasoline. It was
decided, therefore, to abolish the permit system and restore the former payment
of gasoline tax refunds. The elimination of an affidavit form from the application
for such refunds greatly simplified payments and in the six months this change
has been in operation it appears to be working very satisfactorily.
The report of the Chief Municipal Engineer indicates the necessity of all
main rural roads being graded to a standard that will permit efficient snow
ploughing operations. The financial contribution made by the Department
toward County, County-vSuburban and Township roads totalled approximatelv
$7,080,000 as compared' with 85,950,000 in the previous year, .sl,«)0O,O0(^ in 1943
and $8,590,000 in 1942. There is every indication that municipal road subsidies
which have been doubled in the last three years will again be doubled in the
next three years of post-war rebuilding of the feeder roads of the Province.
Illustrating the wide range of conditions which the Municipal Roads Branch
encounters, attention is drawn to the new summary of work on the statute
labour and unorganized township roads. It is interesting to note that the Depart-
ment, while dealing with many roads of high standard equal to any in the world,
is also meeting, in the remote areas of the Province, the same problems encoun-
tered by the first pioneers nearly two hundred years ago. A statement of the
existing number oi various units of municipal government (909) receiving finan-
cial aid for road-building is given in this report. It is interesting to compare
these figures with a similar statement (221) for the year 1920.
In the report of the Motor Vehicles Branch it is noted that while total regis-
tration of vehicles declined slightly (1.8%), the revenue was increased (3.5%),
chiefly due to increased truck registrations. There is an increasing tendency to
license heavy low-bed trailers or "floats" to the full limit of their legal load
which is creating a serious problem in the maintenance of road surfaces. Vehicles
of this type, a rarity before the war, are becoming standard equipment with
many construction firms and large transport organizations. Applications to the
Chief Engineer's Office for special permits for gross loads in excess of fifty tons
are becoming common and it is estimated that less than five per cent of the
roads and bridges in the Province are capable cf carrying these loads. A brief
review of existing legislation governing motor vehicle operation is given.
Sections of this report dealing with the Accident Recording Division are the
most unpleasant for the Department to compile. In cold printed figures they
show that since 1930 a total of 8,881 persons have lost their lives in motor
accidents and 154,095 have been injured. The number of accidents in 1945 was
13,458 as compared with 11,004 in 1944. The number of deaths increased from
498 to 598 in the same period. If this same ratio continues into 1946, more
than 700 persons will lose their lives. The combined elTorts of every safety
organization in the Province aie needed to reduce this tragic record.
To the members of the staff" returning from the armed forces the Department
extends grateful thanks for a job well done. To the loved ones of those who did
not return may the writer be permitted to tender the deepest sympathy on
behalf of their fellow workers.
[9]
10 REPORT UPON HIGHWAY No. 32
REPORT OF THE HIGHWAYS ACCOUNTANT
By John Smith, Accountant
To J. D. Millar, Esq.,
Deputy Minister of Highways.
The following is a summary of the Receipts and Disbursements of the
Department of Highways for the fiscal vear, April 1st, 1945, to March 31st,
1946:
Receipts
Gasoline Tax Branch % 27,308,195.61
Motor Vehicles Branch 9,744,-584.92
Permits: Garages, Signs, etc 104,438.50
Miscellaneous 75,942.88
% 37,263,161.91
Disbursements
King's Highways and Development Roads, etc $ 13,870,960.41
Roads in Unincorporated Townships 262,452.33
$ 14,133,412.74
Subsidies in Aid of County Roads 2,898,135.97
Subsidies in Aid of Township Roads and Indian Reserves 4,180,996.36
Administration, etc 1,711,854.17
$ 22,924,399.24
REPORT OF GASOLINE TAX REVENUE
By J. H. Robinson, Chief Inspector Gasoline Tax
To J. D. Millar, Esq.,
Deputy Minister of Highways.
The following data for the fiscal year 1945-46 relative to the Gasoline Tax
Branch is respectfully submitted:
Gross Revenue
Receipts from Collectors $ 26,689,881.94
Receipts from Importers 39,837.56
Receipts from Fuel Oil Consumers 88,873.26
Receipts — Miscellaneous 15,938.69
Tax Recovered from Bad Debts 2,149.59
$ 26,836,681.04
IMPROVEMENT IN ONTARIO FOR 1945
11
Refunds
Airplanes lOfi Claims $ 246.o20.(i2
American 2r)() • 26,702.39
Cities and Towns 301 • 16.r)28.17
Cleaning 927 " 108,439.93
Conlraeting 764 " 144,440.33
Harming 32,254 " 603,840.06
Federal Government 76 " 19,01 1 .50
Liuiihering 654 " 136,315.45
Maiuifaeturing 2,262 " 973,341.62
Miscellaneous 5 " 1,575.60
Motor Boats 2,527 " 88,554.60
Municipal 246 " 83,326.92
Railways 90 " 52,478.39
Stationary Engines 5,762 " 168,149.76
46,230
Net Kkvenl'E
$ 2,669,230.34
$ 24,167,450.70
Handlin(; Licenses
Agents
Importers
Mixers
Refiners
Transporters
Wholesalers
Fines
50 (M)
46.(K)
158.03
8.00
1,541.45
3,207.45
5,010.93
$ 24,172,461.63
9.00
Dominion Subsidy
Covering Final Payment for 1944-45 and Total Payment
for 1945-4()
ToT.M, Net Revenue
3.135J24.98
$ 27,308,195.61
Gasoline rationing ended August 15, 194.'), resulting in an increase in net
revenue of 27.8% over the previous fiscal year; and a decrease of only 9.2%
below the year 1910-41, on which Dominion subsidy was based. $7,()94,885.09
was received from the Dominion Government to cover decrease in revenue
during 1944-45 as compared with 1940-41. This was reduced to $2,440,839.89
to cover decrease for 1945-10.
The system, instituted in July, 1943, whereby farmers, fishermen, licensed
guides and tourist oufitters were permitted to purchase gasoline, less the Pro-
vincial Gasoline Tax, was cancelled October 1, 1945. Refunds, plus tax exemp-
tions, for the fiscal year 19454() increased 2.2% over the previous fiscal year
and 57.7% over the year 1940 41; 40,230 refund claims were paid, representing
a value of S2,()09, 230.34. Tax exemptions represented a value of $1,087,485.29.
Refund claims plus tax exemptions represents a value of $4,350,715.03 in gasoHne
tax. The auditing of refund claims before payment resulted in $55,892.08 being
disallowed, or 2% of the value of the claims paid.
12
REPORT UPON HIGHWAY
No. 32
The following is a stock summary of the gasoline (including solvents) as
reported in the Province of Ontario:
Gallons
Inventory, March 1, 1945 104,741,340.5
Quantity Manufactured 373,095,534 .
Quantity Imported 61,016,187.6
Purchased by Vendors 599,404,938. 4
Other Items 148,487 . 1
Returned Goods 23,138.4
Gallons
1,138,429,626.
Quantity E.xported
Sales to Vendors
Sales to Government of Canada
Miscellaneous Deductions
Miscellaneous Deductions, Bad Debts
Miscellaneous Deductions, Marked Gasoline.
Miscellaneous Deductions, Minor Losses. . . .
Miscellaneous Deductions, Returned Goods.
Sales on which Tax was Paid
Stock Losses
Inventory, February 28, 1946
57,452,
600.742,
14,801,
26,
14,
21 ,093,
9,
23,
334,892,
11,594,
97,779,
229.5
383.4
769.1
408.9
242.
565 . 3
327.5
138.4
858.3
197.9
505.7
1,138,429,626.
Not included in the above are l,110,i)l() gallons of fuel oil consumed on which
tax was collected.
REPORT OF MISCELLANEOUS PERMITS BRANCH
By C. G. Fairs, Supervisor
To J. D. Millar, Esq.,
Deputy Minister of Hi^liii'ays.
I have the pleasure to submit the following 1945-4(3 Fiscal Year Report:
Building Permits
Number of Permits Issued 1,740
Approximate Value of Buildings $ 6,087,516.00
Public Garage Licenses
Licenses Issued — Class "A" 4,175
Business Transfers — Class "A" 100
Licenses Issued — Class "B" 3,117
Business Transfers — Class "B" 67
Total Receipts $ 56,108.50
Gasoline Pumps — King's Highway Outlets Only
Licenses $25.00 (Curb) 506
Licenses 5.00 (8 ft. to 25 ft. from Highway Boundary) . 2,225
Total Receipts $ 35,493.00
IMPROVEMENT IN ONTARIO FOR 1945 13
Signs
Permits SlIO.OO 43g
Permits o.OO ] 974
Permits 1 .00 '559
Total Receipts $ 12,837.00
License fees received, as indicated above, will coincide with the Treasury
Department Receipts for the Fiscal Year 1945-4().
Garage, Gasoline Pump and Sign Licenses are the issue as of the Calendar
Year, January 1st to December 81st, 1945.
14
REPORT UPON HIGHWAY
No. 32
IMPROVEMENT IN ONTARIO FOR 1945
15
V...--!S^- ^-v^t
16 REPORT UPON HIGHWAY No. 32
ANNUAL REPORT FOR 1945
KING'S HIGHWAYS OPERATIONS
A. A. Smith, Chief Engineer
Operations on the King's Highways and secondary roads during the past
year remained on a wartime basis. A continuation of the program, inaugurated
the previous year, of surfacing existing gravel highways to prevent undue
deterioration of these roadbeds was carried out. A total of 187.6 miles of high-
ways were so surfaced, 100.9 miles with hot mix and 86.7 miles with road mix
surfaces. Approximately 1000 additional miles of gravel surfaces were treated
with prime to provide smooth-riding, dustless surfaces.
In preparation for the post-war construction program detailed soil surveys
were completed on the location of the Toronto- Barrie controlled access highway
between Wilson Ave. and the Holland Marsh; on the location of the Toronto
By-pass between Highway No. 27 and Bathurst St. ; between Beaverton and
Brechin, and Coldwater and Waubaushene, on Highway No. 12; and on Highway
No. 48. A reconnaissance soil survey was conducted on the location of the
Toronto-Barrie highway between the Holland Marsh and Barrie and detailed
borings were taken in the spring break-up areas on Highway No. 27 between
Cookstown and Thornton and on Highway No. 89 between Cookstown and
Alliston.
The laboratory and field data was correlated and applied directly to highway
design, with special emphasis to location of grade line as affected by water table
and the various types of soil. An inventory of granular materials was completed
for the Toronto to Barrie and West Hill to Oshawa highways. Detailed borings
were made and several deposits for granular base course were located. Approxi-
mately four weeks were spent in the field on the study of glacial geology and the
various soil types as related to highway engineering. Soil tests were completed
on all of the above projects at the Soils Laboratory at Maple.
The winter of 1945-46 could be considered as a normal one and although
snow arrived earlier than usual this was offset by more moderate weather in the
later part of the season. The addition of some new snow-fighting equipment
eased the problem of winter maintenance. More extensive use of pure chemicals
to relieve ice conditions was carried out and, within established temperature
ranges, proved most satisfactory. Several miles of snow hedges were planted in
various parts of the Province.
Maintenance operations were again hampered by shortages in labour and
materials but every effort was made to maintain the highways to the usual
standard.
A feature in the design of our highways that has been developed to some
extent in recent years is that of signal and lighting installations to control and
protect traffic movement. The Department now has a total of 41 traffic signals
and 78 flashing signals in operation as well as 429 overhead lighting units in
service.
IMPROVEMENT IN ONTARIO FOR 1945
17
Miilih surfaei. on new Cn-ighton Mint' Road.
1
Laying hilnininons carpel i-oat.
18 REPORT UPON HIGHWAY No. 32
Studies were made in regard to setting up a system of collecting traffic census
data. In the forthcoming year it is planned to secure traffic figures on all King's
Highways and some county and secondary roads. vSixty accumulative traffic
counters were purchased.
Summary of Highway Projects
Hot-mix or road-mix surfaces were laid on existing gravel highways in all but
five divisions. This work included the extension of paved surfaces and the filling in
of gaps in existing paved surfaces. Below is a list of the locations, and mileages,
where these surfaces were laid.
The west-bound traffic lane of The Queen Elizabeth Way was resurfaced with
asphalt to a minimum thickness of five inches from a point one mile west of the
Bronte Bridge to one mile east of Highway No. 25. Bituminous resurfacing was
carried out on Highway No. 21 between Forest and Hank's Corners, a distance
of 11.6 miles; on Highway No. 3 between Leamington and Olinda, a distance
of 6.9 miles; on Highway No. 8 between Mitchell and vSebringville for eight
miles and in shorter sections on other highways, principally in the western half
of southern Ontario.
Grading, preparatory to the laying of pavement, was carried out on Highway
No. 4 between Wingham and Teeswater, a distance of eight miles and on High-
way No. 21 between Port Albert and Amberley, a further 10 miles. On Highway
No. 12, between Orillia and Coldwater, a distance of 133^ miles, and on Highway
No. 27 from the junction of Highway Xo. 5 to the new Malton Road, grading
was carried out, selected granular material placed and an asphalt pavement laid.
Three and one-half miles of Highway No. 29 north from the Montague Township
line were graded and a start made on the paving of this piece of highway. The
raising of the grade on a 10-mile section of Highway No. 66 east of Larder Lake,
begun the previous year, was completed.
The grading of the approaches to the C. P. R. bridge across the Little Current
Channel to permit motor traffic to, and from, Manitoulin Island was completed
during the summer, but, due to the difficulties in securing signal equipment, the
bridge was not opened to motor traffic until November 28th, on which date the
ferry ceased operation. Use of the bridge permits 24-hour service across the
Channel.
Hot-Mix Surfaces Laid
Highway
No. Location Mileage
7 Parkhill-Thedford 8. .5
7 .Silver Lake-.Sharbot Creek 10 5
11 Temagami North and South 10.0
12 Orillia-Coldwater 13.5
17 vSault Ste. Marie North 6.1
17 Kakabeka Falls East 7.8
27 Highway No. 5-Malton Road 3.5
42 Deha-Westport 12.5
56 Blackheath-Highway No. 3 8.0
79 Thedford-Port Franks 5.9
Haliburton-Highway No. 35 14.6
100.9
IMPROVEMENT IN ONTARIO FOR 1945
19
Api)roafh to hridgi- al Link- Curn.iit, showing traffic signals to control both train and motor
vehicle traffic.
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•pttolii^ of tr«*t Id &*1c« to b« lat«rmlc*d by tka Oirtsloa taelA*«r
tr; Sue*rlot*Dd«Bt. Ctbar spvclas of tr**p Bsr b« pla«t«d froa
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DtPARTUtWT Of HKjHWIYS - OHTftR'O
SNOW HEDGE
WITH ruTWHt PLANTINGS
Department standard for snowhedge planting.
20 REPORT UPON HIGHWAY No. 32
Road-Mix Surfaces Laid
Highway
No. Location Mileage
7 Actinolite East 1.0
1 1 Near Marten River 2.0
17 Sturgeon Falls-Hagar 4.3
17 Hagar-Markstay 6.2
17 Vermillion River East 8.0
17 Towns of Webbwood, Massey, Blind River, Bruce Mines,
Thessalon o . 6
17 At Dor ion 3.0
34 Vankleek Hill vSouth 4.0
35 Oxtongue River-Black River 16.5
37 Actinolite-Tweed 7.0
41 Kaladar North 5.5
62 Combermere-Barry's Bay 12.5
66 Larder Lake East 3.0
67 Iroquois Falls-Porquis Junction 6.1
Highway No. 46-Victoria Road 1.0
vSudbury-Frood Mine 1.0
86.7
At the end of the 1945 fiscal year ending March 31st, 194(), the total mileage
of the different types of surfaces comprising the King's Highway System was
as follows:
Concrete 1 772 . 65
Bituminous Pavement 1705 . 09
Low Cost Bituminous vSurface 925.28
Gravel and Crushed Stone 3241 .26
Total 7644.28
A list of the roads added to the system, together with the mileage and date
of designation, also a list of the roads and mileages reverted from the system,
is shown in Appendix No. 3.
The details of the various grading and paving work and of bridges under
construction follow later in this report. Details of bridges completed during the
year are listed in the Chief Bridge Engineer's Report.
SURVEYS BRANCH
Land Surveys
During the year, 401 Land Plans were completed, 310 from field surveys,
and 91 from office information. These Plans cotnprise 182 miles of right-of-way,
19 gravel pits and 1 park area, amounting to 3,350 acres and affecting 67Q
owners.
Owing to the difficulty in hiring sufficient office and field staff, a plan of
training was introduced whereby men without experience, usually ex-service
personnel, were employed and given instruction in plotting, trigonometrical
calculations, fundamentals of surveying, interpretation of field notes, and tracing
with Leroy mechanical lettering equipment. These new draftsmen, after com-
pleting this course, are placed in groups of four or five under the supervision
of a senior draftsman, who gives detailed instructions for each job assigned.
IMPROVEMENT IN ONTARIO FOR 1915
21
Typical Ijiokin scrtion of roadbed caused by spring break-up condilions.
Kxcavaling disintegrated roadbed on Highway No. 3 between Jarvis and vSiincoc
22 REPORT UPON HIGHWAY No. 32
In a similar way the field stafi" is being built up by apprenticing a number
of the more competent field assistants as Ontario Land Surveyors. As these
apprentices become technically qualified, and are familiarized with the various
phases of Departmental procedure, it is intended to make them Chiefs of Parties
under the direction of a District Land vSurveyor.
This year the Standard Concrete Monument was changed to make it five
feet long, an increase of one foot, and, when planted, the extra portion is to
remain above the ground. The purpose of this change is to make it easier for
Departmental Engineers to find and use these survey points, particularly during
the winter and in bush areas, and to reduce the possibility of their destruction
owing to lack of knowledge of their presence.
Location Surveys
Location surveys were made of 1,146 miles of roads consisting of 805 miles
of surveys of existing King's Highways, together with revisions where necessary,
79 miles of Controlled Access Highways, 40 miles of secondary roads and 222
miles of new highways or revisions of existing ones. Field work was completed
and plans prepared for four bridge sites, 27 proposed grade separations at exist-
ing level railway crossings, together with 15 other miscellaneous surveys.
Engineering Work
Engineering work was completed for the Controlled Access Highway from
Toronto to Barrie and the Toronto By-pass. This work consisted of preparing
in detail plans, profiles, etc., for the complete construction of the highways
prior to contracts being called. Fourteen other office engineering jobs were
completed, consisting of setting grades, quantities and designing, etc. Study
plans were prepared of 3,969 square miles consisting of 3,636 square miles com-
piled at a scale of 1000 feet to 1 inch and 333 square miles at a scale of 400 feet
to 1 inch. These plans were prepared from aerial photographs. Highway routes
were selected and marked on the plans and photographs which were used by
field parties in the field when running the proposed road locations.
Traffic Census
A traffic census and study was commenced in vSeptember, 1945, by the purchas-
ing of 60 accumulative automatic traffic counters. These counters were used to
secure data to prepare traffic flow plans and traffic densities in the southern part
of the Province. During the coming year it is proposed to procure traffic census
on all King's Highways, some County and Secondary Roads in Ontario. The
installation of permanent Automatic Traffic Recording Base Stations using
electric eye was delayed owing to the scarcity of equipment being manufactured.
IMPROVEMENT IN ONTARIO FOR 1945
23
Si)ring tlood loiulitions on Highway No. 2 at Pickering.
Asphalt jacking operations
24
REPORT UPON HIGHWAY
No. 32
A winter highway widened l)y rotary plow.
Sand loading bin located at junction of No. 1 1 Highway and Airport Road near North Bay.
IMPROVEMENT IN ONTARIO FOR 1945
25
Rotary plow in operation.
Close-up view of rotary plow in operation.
26 REPORT UPON HIGHWAY No. 32
Division No. 1 — Chatham
Hot-mix mulch surfaces were laid on Highway No. 7 from Parkhill to the
junction of Highway No. 82, a distance of 8.52 miles, and north on the latter
highway to its junction with Highway No. 21, a distance of 5.88 miles. Bi-
timinous resurfacing was carried out on Highway No. 3 for 6.9 miles from
Leamington to Olinda; on Highway No. 18 in spots aggregating one mile between
Amherstburg and Windsor; on Highway No. 21 for 11.6 miles between Forest
and Hank's Corners; on Highway No. 40 for 1.8 miles north of Chatham and
on Highway No. 98 on four miles from Charing Cross to Blenheim.
Over 6,000 tons of rip-rap were placed along Highway No. 40 between Sombra
and Corunna and approximately 1,000 tons each at Amherstburg and at Pelee
dock. Approximately one mile of snow hedge was planted along Highway No.
21 in Lambton countv.
Division No. 2 — London
Highway No. 2 was resurfaced with hot-mix from the junction of Highway
No. 80 westerly for four miles, west from Paris for 0.4 miles and between London
and Thamesford for 1.9 miles. Resurfacing was also carried out on Highway
No. 5 from the junction of Highway No. 24 westerly for 2.85 miles and through
the village of Glencoe on Highway No. 80. Prime was applied on the 10-foot
gravel strip on Highway No. 7 between Elginfield and Parkhill and on Highway
No. 73 from Port Bruce to the Dorchester Road, Highway No. 74 from New
Saarum to Belmont, Highway No. 80 from Glencoe to Alvinston, Highway
No. 81 from Mount Brydes to the junction of Highway No. 7, and Highway
No. 99 from the junction of Highway No. 24 easterly for 4.4 miles; a total mileage
of prime of 14.1 miles of 10-foot strip and 59.8 miles of standard width.
The badly broken section of Highway No. 5 east and west of St. George was
repaired. The old Milldale steel bridge at Norwich on Highway No. 59 was
replaced with a new concrete structure with a span of 55 feet and an old concrete
arch culvert, 3 miles north o{ Delhi, was replaced by a new concrete one. Culvert
replacement was also carried out on Highway No. 2 between London and Thames-
ford, on Highway No. 3 between Talbotville and lona and on Highway No. 4
between Exeter and Lucan. vSome 790 rods of fence were erected.
Division No. 3 — vStratford
Grading, gravelling and shouldering, in preparation for the laying of pavement
was carried out on Highway No. 4 from Wingham to Teeswater, a distance of
eight miles and on Highway No. 21 from Port Albert to Amberley, a distance
of 10 miles. Highway No. 8 was resurfaced with asphalt and shouldering carried
on from Mitchell to Sebringville, eight miles. One hundred and forty-three miles
of standard width and 16 miles of single strip gravel surfaced highways were
primed at the following locations: Highway No. 4 from Teeswater to Highway
No. 9, Highway No. 19 from Stratford to Milverton, Highway No. 21 from
Amberley to Kincardine, Highway No. 83 from Russelldale to Grand Bend,
Highway No. 84 from Hensall to St. Joseph, Highway No. 86 from Listowel to
Bluevale and from Wingham to Amberley, Highway No. 87 from Bluevale to
Harriston, Highway No. 97 from Blackhorse Corner to Hickson, and Highway
No. 100 from Thamesford to Highway No. 7.
Approximately one mile of snow hedge was planted.
IMPROVEMENT IN ONTARIO FOR 1945
PROTECTION OF SHORELINE FROM EROSION
INDERTAKEN AT JORDAN PARK
27
Sra wall iindri- roiisiriu't ion lo rc-tarci (.•r()-^ioIl of shon.-lini-
Rock groins Iniih out from short' to i)iiil(i up sand beach.
F"inishcd graded and sodded shoreline.
28 REPORT UPON HIGHWAY No. 32
Division No. 4 — Hamilton
The eight-mile gravel gap on Highway No. 56 between Blackheath and
Highway No. 3 and the gap at Ancaster on Highway No. 2 at the new diversion
were closed with hot-mix mulch surfaces. A grading contract on Highway No. 54
between Cayuga and Middleport was only partially completed due to adverse
weather.
Prime was applied to gravel surfaces on Highway No. 2 at Ancaster, on
Highway No. 25 from Milton to Acton, on Highway No. 52 from Highway No. 2
to Highway No. 97, on Highway No. 5i from Onodaga to Cayuga, on Highway
No. 97 from Freelton to the Waterloo County Line, on Highway No. 99 from
Copetown to the Brant County Line and on Highway No. 20 at Burlington
Beach.
At Jordon Park further protection of Departmental property from erosion
was carried out with the construction of approximately 1800 lineal feet of break-
water along the shore and consisting of some 10,000 tons of stone blocks and
rubble. One mile of snow hedge was planted on Highway No. 20 west of Smith-
ville.
Division No. 5 — Owen Sound
Prime was applied to Highway No. 4 from Durham west for six miles and
from Flesherton west for fourteen miles. Highway No. 6 from the junction of
Highway No. 21 to Tobermory, Highway No. 24 from Guelph to Erin and from
Highway No. 10 to Collingwood, Highway No. 9 from Orangeville east for 12
miles. Highway No. 89 from Alliston to Primrose and Highway No. 91 from
Duntroon to vStayner, a grand total of 150 miles.
Otherwise only general maintenance was undertaken.
Division No. (5 — Toronto
The west-bound traffic lane of The Queen Elizabeth Way from a point one
mile west of the Bronte Bridge to one mile east of Highway No. 25 was resurfaced
with asphalt to a minimum thickness of five inches. Resurfacing was also carried
out on Highway No. 2 between Toronto and Mimico and on the connecting links
through the towns of Mimico and New Toronto and the Village of Long Branch,
and on Highway No. 5 just west of Summerville for four-tenths of one mile.
On Highway No. 12, between Orillia and Coldwater, a distance of 133/2 miles,
the roadbed was graded, granular base placed, and a 21^" asphalt pavement
laid thereon. Heavy ditching was done along the south side of this highway for
four miles between Port McNicoll and Waubaushene.
Ditching, placing granular base course, and the laying of 2^4 "asphalt pave-
ment was carried out on Highway No. 27 for a distance of 33^^ miles from High-
way No. 5 north to the new Malton Road.
All gravel surfaced highways, with the exception of the divided highway east
of Highland Creek, and totalling 140 miles, were treated with prime.
Division No. 7 — Port Hope
On Highway No. 2, at the Trenton Air vStation, the ditches were filled and
culverts extended over a distance of 1.2 miles to give a widened shoulder.
A large rock cut was taken out 11 miles north of Bobcaygeon on the Bob-
caygeon-Kinmount Road to improve and reduce the grade. One mile of mulch
surface was laid from Highway No. 46 to Victoria Road. Prime was applied to
gravel surfaces over a mileage of 119 miles.
IMPROVEMENT IN ONTARIO FOR 1945 29
Division No. 8 — Kingston
On Highway No. 7 a hot-mix pavement was laid from Silver Lake to Sharbot
Creek, a distance of lOj/^ miles and one mile of mulch easterly from Actinolite.
Hot-mix pavements were also laid on Highway No. 42 between Delta and
Crosby and between Newboro and Westport, a total distance of 123^2 miles.
Seven miles of mulch were laid on Highway No. 37 from Tweed to Actinolite
and mulch was also laid on the plaza at the Customs building on Hill Island
as an extension to the existing pavement at the Thousand Islands Bridge ap-
proach. Prime was applied on Highway No. 7 from vSilver Lake westerly for 20
miles and on Highway No. 37 from Roslin to Tweed a distance of 10 miles.
Grading was carried out on Highway No. 29 from the Montague Township
Line north for .3.5 miles and the paving of this section started but not completed.
The erection of a new bridge over the Moira River near Plainfield on Highway
No. 37, to replace the old bridge which collapsed, was begun but not completed.
On Highway No. 38 a sink-hole, one-half mile south of Sharbot Lake, was filled.
Division No. 9 — Ott.wv.v
A mulch surface was laid on Highway Xo. 34 through the Town of Vankleek
Hill and for a further three miles southerly. All gravel surfaces were primed.
Widening and fencing right-of-way was continued on Highways Xos. 34, 43
and 44, and further snow hedge planted. A snow-plow shed, with sleeping
accommodation for drivers, was erected at Billings Bridge.
Division No. 10 — B.\ncr()FT
A mulch surface was laid on 53^ miles of Highway No. 41 north from Kaladar
and on 1234 miles of Highway No. 62 between, and through, the Villages of
Combermere and Barry's Bay. Prime was applied on Highway Xo. 7 between
Madoc and Actinolite, on Highway No. 28 between Burleigh Falls and Bancroft
and on Highway Xo. ()2 between Madoc and Bancroft, and on the Eganville-
Kelly's Corners Road.
As a result of the lack of snow during the early part of the winter, frost pene-
tration was deep and resulted in much greater than normal spring break-up
conditions.
Division No. 11 — Huntsvillh
A mulch surface was laid on Highway No. 35 from the Oxtongue River
through Dorset to the Black River, a distance of 16.5 miles; and through several
villages in Haliburton, aggregating 2.5 miles. Resurfacing was carried out on
Highway No. 11 between Severn Bridge and Sundridge and on certain secondary
roads. Hot-mix pavement was laid from Minden to Haliburton. Prime was
applied to Highway No. ()9 from Nobel to Shawanaga, a distance of 12 miles,
and to the first four miles east from Parry vSound on the Parry Sound-Sundridge
road.
Division No. 13 — North B.w
Two miles of nmlch surface were laid on Highway No. 11 near the north end
of the division. Three short sections, totalling 4.25 miles, of mulch were laid on
Highway No. 17 between Sturgeon Falls and Hagar. Prime was applied on
Highway No. 17 between Verner and Warren, a distance of 10 miles, and com-
30 REPORT UPON HIGHWAY No. 32
pleted between North Bay and Mattavva; also, followed by a surface treatment,
on eight miles of Highway No. 63 between North Bay and Feronia.
A short diversion at Chalk River on Highway No. 17 was constructed and
Highway No. 64 reshaped throughout. A concrete culvert was constructed on
Highway No. 11 one mile south of Trout Creek. A double snowplow building of
brick and concrete was built at Pembroke.
Division No. 14 — New Liske.ard
Ten miles of hot mi.x was laid on Highway No. 11 north and south of Temagami
and three miles of mulch laid on Highway No. 6() east of Larder Lake. Prime was
applied to gravel sections of Highway No. 11 south of Latchford and to Highway
No. 101 from Pamour easterly for 15 miles.
The raising of the grade on a ten-mile section of Highway No. (56 east of
Larder Lake, begun the previous year, was completed, extensive ditching was
carried out between Kirkland Lake and Larder Lake, and work started, but not
completed, on a revision near Barber Lake.
On the Charlton Road the approaches to Aidie Creek Bridge were constructed
and three miles of new road were opened on the Goldhawk Road.
Division No. 16 — Cochrane
A mulch surface was laid on Highway No. 67 between Iroquois Falls and
Porquis [unction. Five local timber bridges were replaced on Highway No. 11
and repairs were made to the Buskegan River and Missanaibi River Bridges and
to the Abitibi Ferry.
Division No. 17 — Sudbury
The grading of the approaches to the C. P. R. bridge across the Little Current
Channel to permit motor traffic to and from Manitoulin Island was completed
during the summer but, due to the difficulties in securing signal equipment, the
bridge was not opened to motor traffic until November 28th, on which date the
ferry ceased operation. Use of the bridge permits 24-hour service across the
Channel.
On Highway No. 17, 6.2 miles of mulch surface were laid between Hagar and
Markstay and 8.0 miles from the Vermillion River easterly. A mulch surface,
one mile in length, was laid on the new grade of the Sudbury-Frood Road.
Division No. 18 — Bund River
A hot-mix pavement was laid on Highway No. 17 for 0.6 miles east of Sault
Ste. Marie and a further 5.5 miles north of Sault vSte. Alarie. A total of 5.6
miles of mulch surfaces were laid through the Towns of Webbwood, Massey,
Blind River, Thessalon and Bruce Mines. Prime was applied from the east
boundary of the division for 25 miles to the pavement west of Walford and
between Iron Bridge and Thessalon, a distance of 15 miles.
To remedy sub-grade conditions, selected material was placed to a depth of
two feet on a one-mile section west of Nesterville. A diversion, 1600 feet in
length, to avoid the necessity of rebuilding a bridge, was constructed on the
Iron Bridge-Chapleau Road.
IMPROVEMENT IN ONTARIO FOR 1945 31
Division No. 19 — Fort William
The pavement west of Fort William on Highway No. 17 was extended to
Kakabeka Falls with the laying of 7.8 miles of hot-mix. Three miles of mulch
were laid in the vicinity of Dorion. East of Port Arthur resurfacing was carried
out for a distance of two miles and resurfacing was also done on Highway No.
61 between Hamilton's Corners and Cloud River for a distance of three miles.
Prime was applied to Highway No. 17 for nine miles west of Kakabeka Falls and
for 17 miles on Highway No. 17- A.
The reconstruction of the Little Long Lac bridge and approaches was com-
pleted and a new concrete bridge was erected over the Little Firesteel River on
Highway No. 17 west of Fort William. The bridge over the Jarvis River was
replaced with a large concrete culvert. A road was built from the Leitch Gold
Mine to the shore of Lake Nipigon.
Division No. 20 — Kenor.a
Prime was applied to 22 miles of Highway No. 17 between Dryden and
Vermillion Bay. Otherwise only sundry construction and general maintenance
were carried out.
Division No. 21 — Fort Frances
On Highway No. 71, '.i.o miles west from Sleeman were resurfaced. Prime was
applied on Highway No. 70 for 18 miles south from Nestor Falls and on Highway
No. 71 for eight miles east from Emo, for eight miles east from Sleeman and for
1.5 miles east from Rainy River. Prime was also applied on the River Road from
Fort Frances east to Rainv Lake.
BRIDGES COMPLETED DURING THE YEAR 1945
Arthur Sedgwick, Chief Bridge Engineer
During the year 752 lineal feet of bridges was completed by the Department,
chiefly in Northern Ontario.
Little Firesteel Bridge
This is a 40-foot span rigid frame concrete bridge on Highway No. 17 west
of Fort William, replacing an old timber structure.
Little Long Lac Bridge
The existing creosoted timber bridge was originally built as a trestle bridge
with grades rising to the centre to provide for navigation. With the building of
the highway water-borne traftic ceased and the increase in vehicular traffic with
lack of proper vision made the bridge dangerous. The grades were accordingly
cut down and the bridge shortened and widened by substituting a rock fill at
each end.
32 REPORT UPON HIGHWAY No. 32
Milldale Bridge
This is a 50-foot span rigid frame concrete bridge on Highway 59, south of
Norwich. The old steel bridge had previously collapsed under military traffic.
The remaining construction consists of timber and creosoted timber township
bridges built in the Sudbury and Thunder Bay districts.
A complete list of all the bridges built is given in Appendix 4.
REPORT ON THE WORK OF THE MUNICIPAL ROADS BRANCH
FOR THE YEAR 1945
J. A. P. Marshall, Chief Municipal Engineer
The winter of 1944-45 will long be remembered by road officials throughout
the Province as a most abnormal one. The various county and township organi-
zations are to be congratulated on their earnest endeavor to keep the roads
under their jurisdiction passable in spite of the most trying conditions, and
their co-operation in assisting officials on the King's Highways is to be highly
commended. Greater demands are being made by the local ratepayers and the
general public to have the clearing of snow extended to many additional roads
in the rural areas of Ontario.
During the war years there has grown up a tremendous backlog of necessary
construction on our municipal roads. Many miles of these roads should be
graded sufficiently to provide for the efficient use of winter equipment. The
usual program of adequate maintenance was well carried out on the various
municipal roads throughout the Province. However, due to the shortage of
materials and to delays in the delivery of road equipment units, this program
of maintenance in many instances had to be curtailed.
Total number of municipal units throughout the entire Province,
made up of the counties, organized townships, etc., are as follows:
37 Counties
670 Organized Townships
1.5 Organized New Improvement Districts (Township Units)
125 Townships in the Statute Labour Group
190 Unorganized Townships
Total 1037 Counties and Individual Townships.
Total of the above units eligible for Highway Improvement Aid is
969, made up as follows:
37 Counties.
571 Organized Township Municipalities, made up of 670 indi-
vidual townships.
11 Improvement Districts, made up of 15 individual townships.
2 Provincial Parks.
135 Statute Labour Boards, comprising the whole or parts of 125
townships.
183 Units, comprising 190 townships or parts of townships.
30 Indian Reserves.
Total 969
IMPROVEMENT IN ONTARIO FOR 1945 33
COUNTY ROADS
Since the passinjj; of The Highway Improvement Act in 1901 and to the end
of 1945 a total of -SIT 1,134,270.52 has been expended on construction and
maintenance of county roads, of which the province has contributed $81,886,-
044.49. This includes the county expenditure during 1945 on which the provincial
subsidy was paid in 1940.
At the end of 1945 the province was paying subsidies to the counties on 8,560
miles of county roads — approximately 15 per cent, of the total road mileage
in the area covered by the County Road System.
Expenditure on county roads in 1945 was as follows:
Approved Provincial
Expenditure Subsidy
Construction
County Roads $ 1,947.294.40 $ 1,021,315.10
Maintenance
County Roads « 3,744,785.4r) $ 1,876,820.87
TuT.M. Kxi'ENDiTt'RE $ 5,692,079.85 $ 2,898,135.97
Construction Work
The work on which the above expenditure was made included the following:
Gravel or vStone 41 , 99 Miles
Lo'.v-Cost Bituminous Surfaces 72. 14
Mixed Macadam and Asphalt ic Concrete 14.00
Cement Concrete-
Total 128.13
Bridges Over 10-Foot Span 24 "
Pipe and Tile Culverts 291
Other Culverts 65 "
Maintenance Work
Bituminous Surface-Treatment 517 Miles
Dust-Prevention Treatment (Oil) 121 "
Dust -Prevent ion Treatment (Calcium) 2115. "
Clay-Gravel Stabilization (Calcium and Salt) 51 . "
Gravei- and Cri'shed Stone Resurfacing:
(a) Pitrun Gravel Applied 96,997 Cu. Yds.
(bl Crushed Gravel Applied 479,216 " "
(c) Crushed Stone Applied 74,774 •'
Snow Removal:
(a) Mileage of Road Kept Open with Mechanical
Equipment 8.263 Miles
(b) vSnow Fence Erected 942 "
34
REPORT UPON HIGHWAY
No. 32
Mileage Adjustments
During 1945 the following changes in the county road systems were ap-
proved :
County
Deletions
Miles
Brant
Bruce
Carleton
Huron
Lambton
Leeds and Granville
Northumberland and Durham. . . .
Oxford
Peel
Prescott and Russell
Renfrew
Simcoe
Victoria
York
Total
A net addition of 43.14 miles
12.25
0'20
2.00
19.36
33.81
COUNTY SUBURBAN ROADS
The mileage of suburban roads is 879 miles. The approved expenditure at the
end of 1945 amounted to $32,092,224.61, of which the cities and separated towns
have contributed $8,367,85().89, or five per cent, of the total expenditure made
on the County Road Systems.
In 1945 the expenditure on county suburban roads was $777,155.02, of which
the province contributed $394,771.81 and the cities $191,191.60.
IMPROVEMENT IN ONTARIO FOR 1945
35
EXPENDITURES ON COUNTY SUBURBAN ROADS - 1945
Name of County
Brant
Carleton
Elgin
Essex
Frontenac
Grey
Hastings
Kent
Lambton
Lanark
Leeds and Grenville:
Smith's Falls
Brockville
Lincoln
Middlesex
Ontario
Oxford
Perth
Peterborough
Stormont, Dundas and Glengarry,
Waterloo:
Gait
Kitchener
Welland:
Niagara Falls
Welland
Wellington
Went worth
York
Totals .
Mileage
26.4
90.0
20.0
41.0
38.2
32.5
5.0
9.7
14.5
6.0
5
7
12
54
16
3
7.
76.
30.0
14.2
no
9.9
7.0
23.5
53.0
264.2
Approved
Expenditure
; 29,355.76
90,876.64
14.933.44
22,099.70
24,189.21
21.636.86
4,157.05
3.304.35
10,609.84
8,862.70
863.39
7,416.82
12,680.60
44.I75.()7
14.407.01
1.354.80
6,919.21
40,586.26
1,317.54
6,964.70
4,844.83
5.153.73
3.170.15
11.001.61
73.285.06
312.988.09
Government
Grant
14,677.88
48,524.72
7,466.72
1 1 .049.85
12,094.60
10,818.43
2.078.52
1,652.13
5,304.92
4.431.35
431.69
3.708.41
6,340 30
22,087.84
7,203.50
677.40
3,459.61
20,293.13
658.72
3.482.35
2,422.41
2.576.36
1.585.08
5.500.80
37.591.87
158,653.22
879.2 I $ 777,155.02 I $ 394,771.81
ORGANIZED TOWNSHIP ROADS
For the year 1945 the j^overnnieiit subsidized road expenditures in oGf) town-
ships, 6 improvement districts, 2 provincial parks and 22 Indian Reserves.
Expenditure on these roads in 1945 was as follows:
Construction Maintenance Total
^o.^d^ • ■ « 1 ,763,661 4 1 .? 3.695.64 1 .31 S 5.459.302.72
Bridges (ordmary rate) 15.945.08 57,120.93 73 066 01
Bridges (special rate) 329.925.76 39.188.30 369!ll4 06
Winter Control 1.795.051. OS 1.795.051.08
Total Approved Expenditure $ 2.109,532.25 $ 5.587,001 .62 $ 7 696 533 87
Provincial Subsidy $ 1,203,589.68 $ 2,974,019.15 $ 4;i77,'608.83
Construction Work
The work on which the above expenditure was made included the following:
Gravel or Stone 631 .0 Miles
Low-Cost Bituminous Surfaces 15.4
Mixed Macadam and Asphalt ic Concrete 1.5
Total 647 g ••
Bridges Over 10-Foot Span 152
Pipe and Tile Culverts 694
Other Culverts 482
3() REPORT UPON HIGHWAY No. 32
Maintenance Work
Bituminous Surface-Treatment 180 Miles
Dust-Prevention Treatment (Oil) 162
Dust-Prevention Treatment (Calcium i 942
Clay-Gravel Stabilization (Calcium and Salt i 16
Gravel and Crushed Stone Resurfacing:
(a) Pitrun Gravel Applied 704,940 Cu. Yds.
(b) Crushed Gravel Applied 1,331,106 Cu. Yds.
(c) Crushed Stone Applied 397,083 - "
Snow Removal:
(a) Mileage of Road Kept Open with Mechanical
Equipment 27,953 Miles
(b j Snow Fence Erected 1,111
Weed Spraying 8o0
CHIEF CONSTRUCTION WORK COUNTY ROADS AND
ORGANIZED TOWNSHIPS
Kent County - During 11)45, laid a ."i-inch layer of hot plant-mixed asphaltic
concrete over 14 miles of old bituminous pavement and 2 miles on the Essex-
Kent boundary line. North of Wheatley, County Road Xo. 1 was covered with
6 inches of clay-gravel-calcium stabilizing material.
Lambton County — Laid 4.5 miles of road-mixed bituminous pavement.
Elgin County — Laid 3 miles of armour bituminous coat near the \'illage
of Springfield.
Middlesex County — Laid 10 miles of plant-mix nmlch pavement on the
Hamilton Road, completing the pavement of this important road in the county
of ^liddlesex.
Halton County — Practically completed by the end of the year the Glen
Williams bridge, with a span of 9() feet.
Frontenac County — Built a new modern garage and repair shop at
vSydenham.
Leeds and Grenville County — During the year Mr. E. R. Blackwell, who
had been County Engineer since the inception of the County Road System in
this county thirty-five years ago, retired, and was replaced by Mr. D. A. Maciver
as County Engineer.
District No. 13, Parry Sound — Widening of the present grades to enable
power graders to operate and the improvement of drainage was carried out.
The use of crushed gravel is being encouraged by the various municipalities in
lieu of pit-run.
District No. 14, Nipissing -The replacement of the necessary culverts,
chiefly with creosoted wood stave pipe, was carried out, and maintenance con-
sisted of systematic dragging. ^Mechanical equipment is making big improvement
in the necessary snow removal and the haulage of gravel in this district. Labour
shortage here proved a serious handicap to the elTicient operation of the adequate
maintenance.
District No. 15, Temiskaming — The disastrous flood at the end of May
upset plans for many items of new construction which were laid out early in
1045. vSome permanent structures were erected to replace damage done but the
urgency and lack of men and materials necessitated emergency repairs of a
temporary value in most cases.
IMPROVEMENT IN ONTARIO FOR 1945 37
District No. 16, Cochrane — In the four orj^anized municipalities in this
district, the work consisted largely of roadside ditching, gravelling and the
necessary repairing of culverts and bridges.
District No. 17, Sudbury — Mulching of 4.5 miles of gravel surfacing and
the introduction of power maintenance in the eleven townships made a great
improvement in the maintenance work. Wooden bridges and culverts, built with
timber treated with preservative, likewise made a decided improvement on
many miles of township roads.
District No. 18, Algoma ~ Two bridges were rebuilt, two major bridge
repair jobs carried out and .S,")()0 feet of snow fence installed. One mile of new
road was graded and gravelled.
District No. 19, Thunder Bay — Systematic dragging of 2,400 miles and
the brushing of 10 miles, in addition to the placing of 40,000 cubic yards of gravel
and 12 miles of roadside ditching, was carried out in the organized townships in
this district.
District No. 20, Kenora One bridge of 21 2-foot span, and another of
240-foot span, each with the necessary fill, were constructed. Eight miles of
roadside ditching was done and 12,000 cubic yards of pit-run gravel were applied
on the various township roads.
District No. 21, Rainy River Fifteen wood and 2 concrete culverts were
installed, 42.') miles of dragging and 0.2 miles of heavy grade repairs were carried
out; 27,000 cubic yards of pit-run gravel were applied and 30 bridges and 150
culverts were repaired. A wet summer and autumn necessitated intensive
gravel repairs.
INDIAN RESERVES
Three Reserves became eligible for subsidy in 1945: Constance Lake, 'Golden
Lake and Fort William. Of the 23 Reserves eligible, 22 reported expenditures
totalling 845,845.57 on which the subsidy paid was $23,7(58.28.
Indian Reserve Expenditure
Alnwick No Aid Taken
Cape Croker $ 968.17
Caradoc 1.708.14
Christian Island 404.50
Constance Lake 2,500.00
Fort William 1 .382.25
Gibson 1 ,500.00
Golden Lake 299.77
Kettle Point 1 .020.5(1
Moravian 500.00
Mud Lake .")35.45
New Credit 2.33fi.l2
Parry Island 532.55
Rama 244.15
Rice Lake 232. .50
Samia 449.70
Saugeen 947.00
Shawanaga 204.75
Sheguiandah 293.75
Six Nations 20.868.43
Tyendinaga 6.996.43
Walpole Island 1 .305.20
West Bay 616.15
Total $ 45,845.57
38 REPORT UPON HIGHWAY Nx 32
NEW GRAPHIC ILLUSTRATION
A new appendix has been added to our section this year: a page of graphs
to illustrate the rise and fall in total annual approved expenditures by organized
municipalities and in government subsidies during the period 1920 to 1945
inclusive. It is interesting to note that the first high point of expenditure occurs
for 1921. Late 1920 and early 1921 was Canada's post-war recovery peak, and
our 1921 expenditures represent also something of a milestone in the educational
program for good roads which had been in progress since the beginning of the
century. What is sometimes called the primary post-war depression began in
1921 and accounts largely for the drop in municipal road expenditures to the
low of 1925-26. The next high point is, of course, reached during 1929, the last
year of our peace-time boom period. The succeeding world financial depression
had the eflfect of driving road expenditures to an extraordinary low level in
1933. In that year, for the first time, the nmnicipalities' road appropriations
were limited for purposes of subsidy and have been to a greater or less degree
controlled by the Department ever since. The greatest reduction thus made to
ease the road tax burden was in 1942. Since then, the chief limitation on mu-
nicipal road expenditures has been caused by the wartime shortage of men
and materials.
The graphs begin at 1920 because, although four counties were drawing
subsidies on county road expenditures as early as 1903, the 37 organized counties
were not all drawing such subsidies until 1919. Township road subsidies com-
menced with the work-year 1920 under this Branch, with 184 organized town-
ships participating. In 1937 the Department of Highways absorbed the Depart-
ment of Northern Development and the number of organized townships taking
aid under this Branch jumped from 344 in 1937 to 559 in 1938.
Rates of subsidies paid are now higher than at any previous period. County
subsidies commenced with 33',% on construction expenditures only. In 1920
the rate was 40% on both construction and maintenance. At present the rate
is 50% on general expenditures and 75% on special bridge works. The organized
townships for 1920 were given 20% on general expenditures and 40% on superin-
tendence. The present township rates vary from 50% to 80%, with an average
on the 1945 total of 54.3%.
INTERIM PAYMENTS
The policy, inaugurated in 1944, of allowing interim payments of subsidy to
all organized municipalities on the basis of their road expenditures during the
first eight months of the year was continued in 1945. All the counties and 503
of the other organized units made the simple application for these interim
cheques. The total subsidies thus paid out was S3, 4 18,462.76 :-to the counties
$1,385,184.24 and to the townships, etc., $2,033,278.52. It will be noticed that
nearly half of the total road subsidies on the 1945 expenditure were given as
interim payments. The percentages of interim payments to final payments was
47.8 per cent, for the counties, 48.8 per cent, for the townships and 48.3 per cent,
for the two groups combined.
EXPENDITURE ON WINTER CONTROL
For the second year this report lists the total approved expenditures by
counties and townships for the control of winter conditions: snow clearing, sand-
ing, purchasing and erecting snow fence, and so on. Because of the difficulties
of the winter of 1944-45, to which reference was made at the beginning of this
report, more than one fifth of all municipal road expenditures in 1945 were for
winter control. The total approved county and township expenditure was
$13,388,613.72 and of this 20.8%), $2,785,491.83, was spent to keep municipal
roads open during the winter months of this year.
IMPROVEMENT IN ONTARIO FOR 1945 39
STATUTE LABOUR AND UNORGANIZED TOWNSHIPS
District No. 13
Seventeen Statute Labour Boards operated. Many of the narrow trails
were widened and surfaced with crushed gravel. On one particular road, four
out of the eight miles were reconstructed to make accessible one of the best lakes
in the province.
Two Unorganized Townships received aid on a 50-50 basis.
District No. 14
Eleven Statute Labour Boards operated but it was only in the latter half
of the season that progress was made and this was especially along the lines of
replacement of culverts and small bridges. Under the reorganized methods
adopted it is expected that considerable road improvement will be in evidence.
District No. 15
Sixteen Statute Labour Boards operated successfully but the disastrous
flood in May 1*.>15 upset plans for new construction. Some permanent structures
were erected to replace damage done but in most cases it was necessary to resort
to emergency repairs.
Eleven unorganized townships received assistance on the 50-50 basis, while
eight Townships had 100% Bridge expenditures following the heavy rains.
District No. 16
Nine Statute Labour Boards (six new organizations and three formed
previously) operated with the exception of one which was set up too late to
carry on successfully. Preliminary work on 15 further Boards will show these
15 transferred to vStatute Labour early in the following year.
In the unorganized townships, S3, 735.22 was spent on work on a 50-50 basis.
District No. 17
Twelve Statute Labour Boards operated successfully while one had difli-
culty in maintaining its organization. New bridges and culverts were built and
major bridge repairs were effected in the area.
Nineteen unorganized townships and three Indian Reserves received assist-
ance.
District No. 18
Ten Statute Labour Boards operated successfully and show an increase in
the value of the work performed. Power maintainer operation has greatly
improved the condition of the roads where this assistance has been available.
Nineteen unorganized townships received assistance and four Indian Reserves
were also assisted in their voluntary work.
District No. 19
Fifteen Statute Labour Boards operated successfully but two townships
previously organized are not included: Devon and Dorion. Settlement in this
district is confined to the organized and Statute Labour townships. There are no
expenditures reported in the unorganized townships.
40 REPORT UPON HIGHWAY No. 32
District No. 20
Fourteen Statute Labour Boards operated successfully but the Statute
Labour township of Redditt reported no expenditures for this year.
Two unorganized townships received assistance and one of these, Wabigoon,
has since been organized for Statute Labour and a number of unorganized town-
ships have organization under consideration.
District No. 21
Seven Statute Labour Boards operated successfully. There is only one
unorganized township in the district and there is not a sufficient number of
settlers to form an organization.
CONCLUSION
The organized counties and townships of this Province have a splendid group
of engineers and road superintendents, under whom the organization in each
municipality functions. They are to be congratulated on their good work during
the past few years in keeping up the usual excellent standard of maintenance.
They are meeting present-day conditions, the shortage of road materials, delay
in procuring the necessary equipment and problems of labour exceptionally well
In addition, the Department appreciates the sincere efforts of the various groups
in the unorganized townships in northern and northwestern Ontario, especially
where these have been instrumental in organizing Statute Labour Boards. Great
interest has been shown in all districts and Ontario has every reason to be proud
of the many road organizations throughout the Province which have ably
co-operated with the Department of Highways in their important work.
APPENDICES
Nos. 1 to 10
[41]
42
REPORT UPON HIGHWAY
No. 32
APPENDIX No. 1
EXPENDITURES BY COUNTIES AND DISTRICTS
April 1, 1945, to March 31, 1946
County
Brant : —
Highway No. 2
No. 5
No. 24
No. 24A
No. 53
No. 54
No. 99
Connecting Link, Town of Paris .
Bruce
High
way No. 4
No. 6
No. 9
No. 21
No. 86
Connecting Link, Town of Walkerton.
CarleTon : —
Highway No.
No.
No.
No.
No. 31
No. 44
Ottawa By-pass
Connecting Link, \'illage of Eastview.
15.
16.
17
29
Dufferin: —
Highway No. 9
No. 10
No. 24
No. 89
Connecting Link, Town of Orangeville.
Elgin : —
Highway No. 3
No. 4
No. 19
No. 73
No. 74
No. 75
No. 76
No. 77
Connecting Link, Town of Ayhner .
St. Thomas East Entrance
Construction
$ 2,068.01
3,678.61
574.29
135.56
$ 6,456.47
$ 757.10
7.985.14
615.47
1,279.67
559.52
$ 11,196.90
$ 11.59
3,634.12
14,493.51
4,148.83
1.290.86
1,749.43
25.328.34
630.26
1,168.35
175.45
1.974.06
475.38
163.76
618.49
69.49
5.58
Maintenance
$ 32.819.55
57,366.72
18.306.40
4.657.26
22,223.33
13.862.39
8,718.43
1,600.13
1,332.70
$ 1.59.554.21
$ 57,540.27
64,416.94
26,610.95
49,-580.84
7,7.35.69
498.32
$ 206,383.01
$ 14,716.67
28,304.97
30,210.63
5.777.08
31,628.22
14.897.36
675.00
.$ 126,209.93
$ 19.942.65
23,082.09
18.226.76
11,455.12
183.25
S 72,889.87
$ 32.852.50
6.260.32
4,075.07
12,287.56
7,481.65
1,186.69
4,658.05
1 ,977.85
803.55
338.40
$ 71,921.64
Total
34,887.-56
-57..366.72
21.985.01
4.657.26
22,797.62
13.997.95
8.718.43
1,600.13
$ 166,010.68
$ -58,297.37
72.402.08
27.226.42
50,860.51
8,295.21
498.32
$ 217,-579.91
.« 14.728.26
31.939.09
44.704.14
5.777.08
35.777.05
16.188.22
1.749.43
675.00
$ 151.538.27
$ 20.-572.91
23.082.09
19.395.11
11,630.57
183.25
$ 74,863.93
$ 33,327.88
6,260.32
4.075.07
12,451.32
8.100.14
1.186.69
4.727.-54
1 .983.43
803.-55
338.40
$ 73.254.34
IMPROVEMENT IN ONTARIO FOR 1945
43
County
Essex: —
Highway No. 2
No. 2B
No
No
No
No
No
No
No
No
Pclce Island
Proposed Tilbury-Windsor Highway. .
Connecting Link, Town of Essex
Connecting Link, Town of Leamington
Connecting Ivink, Town of Harrow. . .
Connecting Link, Town of I^aSalle . . .
Connecting Link, Town of Kingsville.
Connecting Link, Town of Tecumseh.
3. ..
3B..
18. .
18A.
18B.
39..
98. .
98A.
Frontenac: —
Highway No. 2
No. 7
No. 1')
No. 33
No. 38
No. 95
No. 90
Proposed Four-Ivane Highway North
of Kingston
Howe Island I'erry Road
Development Roads —
Highway No. 41 -Plevna
Clarendon Road
Arden-Meyer's Cave
Wolfe Island Ferry
Controlled Access Highway Survey . .
Grey: —
Highway No. 4
No. (i
No. 10
No. 21
No. 24
No. 26
No. 86
Connecting Link, Town of Durham..
Connecting Link, Village of
Chatsworth
Connecting Link, Town of Markdale.
Connecting Link, Village of
Flesherton
Construction
% 306.92
2,491.64
511.58
144.83
1,217.63
780.12
451.66
341.02
6,245.40
122.66
73.09
69.60
119.89
353.97
Maintenance
$ 10,348.64
325.08
95,8.54.51
2,580.55
18,856.22
14,051.26
495.29
4,109.61
13,441.65
545.64
3,167.22
Cr.
1 .055.54
3.937..J2
740.61
924.73
5,071.15
224.71
% 10,582.39
597.95
211.39
31.64
Haldimand: —
Highway No. 3
No. 6
No. 54
No. 56
Connecting Link, Town of Dunnville.
840.98
161.94
1,891.36
2,665.52
15,668.15
125.40
31.71
8.20
179.37
329.39
28.35
$ 164,478.09
$ 17,245.72
116,064.78
12.158.20
10,493.28
44.408.94
5.418.09
10,782.55
4,109.39
3.708.95
% 224,389.90
% 26,195.43
35,258.62
34,255.05
5.362.70
4,848.11
22,187.99
775.32
109.31
289.35
298.99
$ 129,580.87
% 38,639.20
17,838.81
26,600.75
93,395.30
150.95
% 20,386.97
$ 176,625.01
Total
10,655.56
325.08
98,346.15
3.092.13
19.001.05
15.268.89
495.29
4.889.73
13,893.3!
545.64
3,H)7.22
341.02
125.40
31.71
8.20
179.37
329.39
28.35
$ 170,723.49
S 17,368.38
116,137.87
12,227.80
10,613.17
44,762.91
5,418.09
10,782..55
Cr.
1 ,055.54
3,937.52
4,109.39
4,449.56
924.73
5,071.15
224.71
% 234,972.29
% 26,195.43
35,258.62
34, 853. (K)
5,362.70
4,848.11
22.399.38
31.64
775.32
109.31
289.35
298.99
$ 130,421.85
% 38,801.14
19,730.17
29,266.27
109,063.45
150.95
$ 197,011.98
44
REPORT UPON HIGHWAY
No. 32
County
H ALTON: —
Highway No. 2
No. 5
No. 7
No. 25
Queen Elizabeth Way. . . .
Lower Middle Road
Connecting Link, Town of
Burlington .
Hastings: —
Highway No. 2
No. 7
No. 14
No. 28
No. 33
No. 37
No. H2
Development Roads —
Bancroft -Herman
Birds Creek-Baptiste Lake
Maynooth-Hastings Boundary.
Bancroft-Haliburton Boundary.
Bancroft -Calabogie Road
Bancroft -Renfrew
Bancroft -Wilberforce
Huron: —
Highway No. 4 .
No. 8.
No. 9.
No. 21
No. 23
No. 81
No. 83
No. 84
No. 86
No. 87
Construction Maintenance
3,818.25
935.70
15,6n.90
13.63
37,269.14
31,539.25
19,665.51
22,030.46
193,693.04
Total
41,087.39
32,474.95
19,665.51
22,030.46
209,304.94
13.63
775.59
785.74
8.37
13,796.22
369.41
71,234.02
3,993.68
125.04
Connecting Link, Village of Exeter. .
Connecting Link, Town of Clinton. .
Connecting Link, Town of Seaforth..
Connecting Link, Town of Goderich.
Kent: —
Highway No. 2
No. 3
No. 21
No. 40
No. 78
No. 79
No. 98
Middle Road
Connecting Link, Town of Dresden..
Connecting Link, Town of Blenheim.
Connecting Link, Town of
Wallaceburg
Connecting Link, Town of Bothwell.
721.00
90.32
244.79
$ 92,144.18
$ 1,409.14
2,350.75
$ 51,023.73
33,409.58
14,934.21
13,359.70
3.624.65
72,138.64
81,430.10
2,678.74
1,495.85
Cr. 1,122.91
2,865.79
$ 324,753.02
51,799.32
34,195.32
14,942.58
27,155.92
3,994.06
143,372.66
85,423.78
Cr.
$ 275,838.08
S
12,169.06
1,604.39
1,546.05
75,817.71
12,552.56
1,266.40
194,403.40
2,750.22
5,236.03
25,919.06
11,489.90
47,886.70
11,067.73
167.77
152.11
9.81
20.03
$ 19,079.39
$ 2,571.15
38.27
2,803.78
1 ,495.85
1,122.91
2,865.79
721.00
90.32
244.79
$ 367.982.26
$ 77,226.85
14,903.31
1,266.40
206,572.46
2,750.22
5,236.03
25,919.06
11,489.90
49,491.09
12,613.78
167.77
152.11
9.81
20.03
$ 388,739.43 S 407,818.82
4,267.91
;y 89.19"
38,120.94
17,158.66
11,457.07
35.204.06
3.864.28
1.994.66
538.78
47,886.08
170.50
40.50
1,130.10
31.42
40,692.09
17,196.93
11,457.07
39,471.97
3,864.28
1 ,994.66
627.97
47,886.08
170.50
40.50
1.130.10
31.42
$ 6,966.52 I $ 157,597.05 $ 164,563.57
IMPROVEMENT IN ONTARIO FOR 1945
45
County
Lambton: —
Highway No. 7
No. 21
No. 22
No. 40
No. 79
No. 80
No. 82
Proposed Controlled Access Highway
Survey
Hillsborough Beach to East of Forest.
Sarnia-Strathroy
Connecting Link, Town of Thedford. .
Construction Maintenance
7. .
\n.
29.
44.
L.anark: —
Highway No.
No.
No.
No.
County Road 4C
Development Roads —
Darling Township Line North to
Darling Township South
Calabogij-Lanark
Leeds and Grenville: —
Highway No. 2
No. 15
No. 16
No. 29
No. 32
No. 42
River Road
Chaffey Lock Road
Controlled Access Highway Survey.
Lennox and Addington: —
Highw ay No. 2
No. 7
No. 33
No. 41
Bancroft-Renfrew
Controlled Access Highway Survey.
Lincoln: —
Highway No. 8
No. 8A
No. 20
No. 57
No. 58
Queen Elizabeth Way.
135.17
1,213.46
567.29
3.034.14
84.08
514.68
57.78.
35,l(i0.81
34,762.43
2,700.79
40.966.79
20,994.35
2.268.02
74.814.55
49.15
5.606.60
64.46
809.60
7.435.03
291.45
323.75
296.71
491.11
560.87
60.70
762.04
797.18
74.60
944.12
3,690.62
513.91
7.24
1,618.91
90.32
425.50
.$ 2.655.88
1,783.75
1,722.00
219.24
156.47
1,262.72
$ 5.144.18 $ 166.378.41
$ 211.716.89
S (5,023.52
28,689.72
l()5,792.88
3.496.75
1 .040.00
4.469. 13
.•? 9,221.00 .? 209.512.00
54,754.15
65,961.78
1 1 ,975.84
10.892.31
4,265.09
96..331.04
52.263.83
233.91
10.972.95
10.209.04
30.175.34
89.227.94
26.758.72
2,894.30
16,299.20
2,890.94
1.303.00
116.232.25
Total
35,295.98
35.975.89
2,700.79
4 1, ,534. 08
20,994.35
2,268.02
77,848.69
84.08
514.68
57.78
49.15
$ 217,323.49
$ 6.087.98
29.499.32
173,227.91
3.78S.20
1 .040.00
4.792.88
296.71
S 218.733.00
S
.55.245.26
66.522.65
12.036.54
11,654.35
4,265.09
97.128.22
52,338.43
233.91
944.12
S 296.677.95 « 300,368.57
S
11,486.86
10,209.04
30,182.58
90,846.85
90.32
425.50
140,585.27 ? 143.241.15
28.542.47
4,616.30
16,518.44
3,047.41
1,303.00
117,494.97
$ 171,522.59
46
REPORT UPON HIGHWAY
No. 32
County
Middlesex: —
Highway No. 2
No. 4
No. 7
No. 22
No. 23
No. 73
No. 74
No. 80
No. 81
Sarnia-Strathroy
Norfolk: —
Highway No. 3
No. 6
No. 19
No. 24
No. 59
Connecting Link, Town of Simcoe.
Northumberland and Durham: —
Highway No. 2
No. 7A
No. 28
No. 30
No. 33
No. 35
No. 45
Four-Lane Highway, Oshawa East..
Controlled Access Highway Survey.
Connecting Link, Town of
Bowmanville
Construction Maintenance
Ontario: —
Highway No. 2
No. 7
No. 7A
No. 12
No. 47
No. 48
No. 69
Four-Lane Highway, Oshawa East..
Bobcaygeon-Kinmount
Controlled Access Highway Survey .
Preliminary Surveys
Oxford: —
Highway No. 2. . .
No. 3..
No. 19. .
No. 53..
No. 59..
No. 97..
No. 100.
5,«22.30
2,981.29
1,938.89
963.04
1.00
5.75
109.20
420.60
57.78
948.46
3,408.91
$ 4,357.37
$ 349.95
225.93
238.68
521.44
439.40
1,861.91
24,001.22
2,507.43
30,145.96
176.17
176.94
95.12
2,558.85
1,303.54
114.53
922.99
48.49
$ 5,396.63
$ 664.72
651.28
1,322.08
424.05
1,714.59
1,268.41
1,332.03
$ 7.377.16
147,844.78
29,663.37
92,935.24
17,012.03
4,812.69
10,284.06
2,281.61
10,982.24
32,8,56.93
$ 348,672.95
$ 28,360.03
44,836.43
814.99
13,756.80
954.44
54.82
88,777.51
109,045.46
23,832.39
20,322.34
55,610.72
3,957.36
22,251 .82
27,428.94
$ 262,935.28
$ 35,816.30
19,360.92
4,670.24
90,447.50
31,102.21
11,645.51
10,103.72
63,106.82
$ 266,253.22
•S 20,154.43
892.60
20,883.43
4,781.47
45,829.66
17,198.84
16,338.86
Total
1.53,467.08
32,644.66
94,874.13
17,975.07
4,813.69
10,289.81
2,390.81
10,982.24
33,277.53
57.78
$ 360,772.80
$ 28,360.03
45,784.89
814.99
17,165.71
954.44
54.82
$ 93,134.88
% 109,395.41
24,058.32
20,561.02
56,132.16
3,957.36
22,691.22
29,290.85
24,001.22
2,507.43
486.25
$ 293,081.24
S
35,992.47
19,360.92
4,670.24
90,624.44
31,197.33
11,645.51
12,662.57
64,410.36
114.53
922.99
48.49
$ 271,649.85
$ 20,819.15
1,543.88
22,205.51
5,205.52
47,544.25
18,467.25
17,670.89
$ 126.079.29
$ 133,456.45
IMPROVEMENT IN ONTARIO FOR 1945
47
County
Peel:—
Highway No. 2
Construction
$ 2,195.39
6,260.74
10.00
Maintenance
•S 9.447.04
21.037.66
12.311.33
6.802.32
.50.252.32
12,192.88
104.60
22.S23.92
2.S74.22
46,665.59
Total
$ 11,642.43
No 5
27 298 40
No. 7
12,321.33
No. 9
6.802.32
No. 10
157.32
440.53
.50.409.64
No 24
12,6.33.41
No 27
104.60
No 50
22,823.92
No. 51
Queen Elizabeth Way
440.53
»42.85
6.81
3,314.75
47,508.44
Lower Middle Road . . .
6.81
Perth : —
Highway No. 7
$ 10,354.17
$ 102.76
134.32
534.00
941. 53
S 184,511.88
$ 22,189.93
97.347.69
21.809.10
45,809.04
4,141.82
14,866.93
1,304.11
11,999.27
347.20
145.33
$ 194.866.05
•S 22,292.69
No 8
97,482.01
No. 19
22,.343.10
No 23
4(i,7.50..57
No. 83
4,141.82
No 86
274.61
4.54.09
15, 141. .54
No KM)
1,7.58.20
Connecting Link Town of Mitchell. . .
11,999.27
Connecting Link. Town of
Palinerston
347.20
145.33
Peterborough : —
Highway No. 7
$ 2,441.31
$ 1,6.50.69
$ 219,960.42
$ 46,.5.52.13
517.71
67,634.40
4.306.77
18.762.90
7.263.87
$ 222,401.73
$ 48.202.82
No. 7A
517.71
No. 28
1,958.34
69.-592.74
No 30
4.306.77
No. 36
18,762.90
No. 45
40.09
266.48
7.303.96
Development Roads —
266.48
Catchacoma Road
5,125.44
7,334.53
57.99
5.125.44
Loon Lake Loop
7.334.53
Connecting Lake, \'illage of
Lakefield
2,227.45
2,285.44
Prescott .\nd Russeli^: —
Highway No. 17
S 6.143.05
$ 1.242.15
$ 157..5.55.74
$ 39.183.81
29.898.22
93.60
$ 163.698.79
$ 40,425.96
No. 34
29,898.22
Connecting Link, Town of
Hawkesbury
93.60
Prince Edward:—
Highway No. 14
$ 1.242.15
$ 69,175.63
$ 10.195.42
13..341.07
7,760.08
331.92
$ 70,417.78
$ 10.195.42
No. 33
13,341.07
No. 41
2,485.33
10,245.41
Connecting Link. Town of Picton
331.92
$ 2,485.33
$ 31,628.49
$ 34,113.82
48
REPORT UPON HIGHWAY
No. 32
County
Renfrew : —
Highway No. 17
No. 28
No. 29
No. 41
No. 60
No. 62
Development Roads —
Burnstown-Black Donald Mine,
Calabogie- Darling Township Line.
Highway No. 17-Kelly's Corners. . . .
Conibermere-Burgess Mine
Combermere-Quadville
Killaloe-Round Lake
Killaloc-Brudenell
Eganville-Cormac
Dacre-Hyndford
Dacre-Shamrock
Eganville-Kelly's Corners
Bancroft -Renfrew
Dacre-Renfrew
Simcoe: —
Highway No. 9
No. 11
No. 12
No. 24
No. 26
No. 27
No. 88
No. 89
No. 90
No. 91
No. 92
No. 93
Proposed Toronto-Barrie Highway
Barrie-Parry Sound
Waubaushene-Port Severn
Construction
Si 17,453.92
226.95
Stormont, Dundas .^nd Glexg.^rry:
Highway No. 2
No. 31
No. 34
No. 43
Controlled Access Highway Survey.
Victoria ; —
Highway No. 7
No. 35
No. 36
No. 46
Development Roads —
Highway No. 46-Seabright- Uphill-
Norland
Norland-Kinmount-Bobcaygeon-
Burnt River Road
Connecting Link, To'.vn of Lindsay
284.30
846.35
4,800.67
1.528.71
2,754.07
260.55
$ 28,155.52
663.35
1,753.11
1,171.98
1,192.57
196.69
20.46
204.09
114.40
27,986.01
128.58
478.27
118.89
12,230.52
1,649.35
24.15
$ 14,022.91
$ 160.66
81.52
7.64
234.34
755.72
1,239.88
Maintenance
$ 176,757.19
518.55'
35,135.52
59,253.85
101,345.87
19. 578. ,55
10,998.72
1,349.86
4,998.47
4,371.39
2,560.47
3,332.86
1,667.64
1,093.17
3,823.00
10,446.35
53,206.51
206,173.38
23,907.38
33,652.98
89,557.30
6.768.53
26,070.22
19,679.75
7,331.33
4,014.14
13,323.34
4,706.94
498,838.15
53,896.72
15,948.34
19,356.26
26,121.43
Total
194,211.11
226.95
518.55
35,419.82
60,100.20
106,146.54
21,107.26
10,998.72
1 ,349.86
4,998.47
4,371.39
2,560.47
3,332.86
1 ,667.64
1,093.17
3,823.00
2,754.07
260.55
$ 426,785.11 $ 454,940.63
$ 10,446.35
53,869.86
207,926.49
25,079.36
34,845.55
89,753.99
6,768.53
26,090.68
19,883.84
7,445.73
4,014.14
13,323.34
27,986.01
128.58
5,185.21
$ 532,747.66
$ 53,896.72
16,067.23
31,586.78
27,770.78
24.15
« 115,322.75 $ 129,345.66
27,347.51
35,394.55
14,387.95
30,213.19
20,689.09
59,293.34
570.20
$ 187,895.83
27,508.17
35,476.07
14,395.59
30.447.53
20,689.09
60,049.06
570.20
$ 189.135.71
IMPROVEMENT IN ONTARIO FOR 1945
49
Waterloo: —
Highway No.
fc ■• No.
» •■ No.
No.
County
7. . .
8. . .
24..
24 A.
No. 85
No. 86
No. 97
Conncciing Kink, Town of New
Hamburg
Connttting Link, Town of Elniira. .
Conni-tling Link, Town of Hc-spcler.
Weuland:
Highway No. 3 . .
No. 3A.
No. 3C.
No. 8..
No. 20.
No. 57.
No. 58.
Construction
Queen Elizabeth Way.
WEU-iN(;Tt)N: —
Highway No. (i
No. 7
No. 9
No. 23
No. 24
No. 86
No. 87
Connecting Link, Town of Harriston.
Connecting I^ink, Town of Mt. Forest
Connecting Link, Town of Fergus. . . .
Wentworth : —
Highway No. 2
No. 2A
No. 5
No. 6
No. 8
No. 20
No. 20A
No. 52
No. 53
No. 55
No. 56
No. 97
No. 99
Queen EHzabeth Way. . . .
Burhngton Beach
Dundas Diversion
N. Dundas-Freelton
Intersection No. 2 and 6-
Greensville
94.22
242.00
232.22
568.44
,345.79
,293.09
22.12
589.18
,339.50
469.40
469.40
,25L88
$ 12,780.36
$ 500.75
1,031.66
661.37
157.33
339.09
$ 2,690.20
$ 562.29
5,326.19
193.39
2.760.70
1,361.17
138.22
5,638.93
4,975.16
234.69
2,827.12
239.16
Maintenance
$ 7.455.95
20,316.58
6.305.18
8,037.69
4,876.39
16,359.28
4,071.72
162.01
15.34
705.45
$ 68,305.59
S 22,696.47
10,481.26
3.674.55
3.259.98
11.097.58
5,323.03
55,755.39
62,394.20
$ 174,682.46
$ 44.600.26
10,366.20
29,093.82
1,703.68
26,115.44
9,418.42
3.577.90
162.08
273.27
112.52
51,539.60
13,330.96
31,605.58
30,792.69
48,374.19
27,312.12
617.88
11,091.92
8,839.68
2,972.04
11,287.40
7,132.47
13,554.03
28,849.29
4,133.04
7,146.68
$ 24,257.02
Total
7,455.95
20,316.58
6,399.40
8,037.69
4,876.39
16,601.28
4,303.94
162.01
15.34
705.45
$ 68,874.03
S 24,042.26
11.774.35
3,<)96.67
3,849.16
12,437.08
5,792.43
56,224.79
69,646.08
$ 187.462.82
$ 45.101.01
10,36(1.20
30,125.48
1 ,703.68
26,776.81
9,575.75
3,916.99
162.08
273.27
112.52
$ 125,423.59 $ 128,113.79
52,101.89
18,657.15
31,798.97
33,553.39
49,735.36
27,450.34
617.88
11,091.92
8,839.68
2,972.04
16,926.33
7,132.47
13,554.03
33.824.45
4,367.73
7,146.68
2,827.12
239.16
$ 298,579.57 i $ 322,836.59
50
REPORT UPON HIGHWAY
No. 32
County
5A.
7..
11.
27.
York : —
Highway No. 2 .
No. 5.
No.
No.
No.
No.
No. 47
No. 49
Queen Elizabeth Way
Four-Lane Highway, Toronto East .
Proposed Toronto-Barrie Highway .
Queen Street-Lake Shore Road-
Brown's Line
Malt on Airport Road
Connecting Link, Town of Mimico..
Connecting Link, Town of New
Toronto
Connecting Link, \'illage of Long
Branch
Connecting Link, Village of Port
Credit
Construction Maintenance
1,807.70
1,227.45
588.47
690.82
431.78
10.53
914.58
20,402.06
61,019.23
15.04
$ 87.107.66
S 50,226.08
17,424.99
15,568.95
38,397.03
61,678.33
111,480.65
3,399.78
28,084.84
9,323.53
9,528.87
5,520.06'
5,653.89
870.68
1,117.40
S 358,275.08
Total
$ 52,033.78
18,652.44
15,568.95
38,985.50
62,369.15
111,912.43
10.53
3,399.78
28,999.42
29,725.59
61,019.23
9.528.87
15.04
5,520.06
5,653.89
870.68
1,117.40
$ 445,383.74
IMPROVEMENT IN ONTARIO FOR 1945
51
District
Hauiburton: —
Highway No. 28
No. 35
No. 60
Development Roads -
Miiidcii-Hastings County Boundary..
Kinniount-Hastings County
Boundary
Haliburton-Redstone
Minden-Kinniount
Bancroft-Wilherforce
Mindcn-Haliburton
Halihurton-W'hitney
Harcourt Road
Muskoka: —
Highway No. 11
No. 35
No. 60
Xo. 69
Development Roads —
Honey Harbour- Port Severn
Highway No. 1 1-Muskoka-Cottage
Sanitarium
Highway No. 35-Bracebridge-Dorset.
Bracebridge-Glen Orchard
Huntsville-Baysville
FaIkenl)urg-Rosseau
Port Sydney-Windermere
Intcrlaken Road
Barrie- Parry Sound
Connecting Link, Town of
Bracebridge
Connecting Link, Town of
Huntsville
Unincorporated Townships —
Sinclair Townshij)
Baxter Township
Construction ' Maintenance
1.505.50
6,827.30
2.56
114.82
82.55
224.79
307.82
1.682.72
175.23
S 10.923.29
S 132.07
25.81
175.47
333.35
13,508.40
46,342.60
4.160.70
164,168.12
25.061.44
5,575.38
9,000.94
$ 267.812.58
S 103.308.10
32,095.03
19.106.95
22.886.70
8.179.55
181.97
2(),016.97
15,642.27
5,493.13
29,464.32
15,974.95
3,282.93
286.70
1,820.90
1,063.56
1 ,005.00
Total
15,008.90
53.169.90
4.163.26
164.282.94
25.143.99
5,575..38
9,000.94
224.79
307.82
1.682.72
175.23
$ 278.735.87
$ 103.440.17
32.095.03
19,132.76
22,886.70
8,179.55
181.97
26,016.97
15,642.27
5,493.13
29,464.32
15,974.95
3,282.93
175.47
286.70
1 ,820.90
1,063.56
1,005.00
$ 285,809.03 I $ 286,142.38
52
REPORT UPON HIGHWAY
No. 32
District
Nipissing: —
Highway No. 11
No. 17
No. 60
No. 62A
No. 63
No. 64
No. 94
Development Roads —
East Boundary Nipissing-Hagar
South Boundary Nipissing-North
Boundary Sisk
North Boundary Nipissing-
Temiskaming
Field-Highway No. 11
Mattawa-Harringlon Creek
Highway No. 1 1 -Airport
Verncr-Lavigne-Muskrat Creek
Field River Valley-Afton Mine
Warren-River \'alley
Hagar-Rutter-Bigwood-Wolseley Bay.
Old Highway No. 1 1
Madawaska-Cross Lake
Highway No. 60-Hastings Boundary..
French River-Lavigne
Mining Roads —
Cuniptan Road and Spurs
Unincorporated Townships —
Sproule Township
Phelps Township
Grant Township
Bastedo Township
Gibbons Township
Badgero Township
Crerar Township
Hugel Township
Kirkpatrick Township
McPherson Township
London Township
Falconer Township
Scollard Township
Henry Township
Delamere Township
Bigwood Township
Lauder Township
Beaucage Township
Pedley Township
Patterson Township
Gurd Township
Pringle Township
Wilson and McConkey Township . . .
Mills and Hardy Township
Airy Township
Murchison Township
Sabine Township
Construction Maintenance
6,790.20
5,611.61
3,066.81
48.50
1,355.80
1,98.5.40
164,300.80
108,753.05
36,142.85
633.68
831.06
449.74
1,898.14
311.44
870.49
Cr.
37,132.26
23,013.61
3,287.41
1,134.35
1,845.85
21,1.30.50
10,904.15
22,171.58
61,064.72
1,921.57
2,271.11
76.59
$ 23,852.87
10.13
113.36
1,246.42
119.10
28.86
8,142.60
1,288.19
1,030.99
2,542.17
2,244.87
2,132.94
928.49
862.92
336.50
1,514.41
736.11
2,415.78
181.17
21.60
112.06
1,577.58
4,294.90
2,162.70
1,874.36
4,526.22
546.22
1,947.22
736.19
$ 538.671.28
Cr
Total
171,091.00
114,364.66
39,209.66
48..50
38,488.06
24,999.01
3,287.41
633.68
831.06
449.74
1,898.14
1,134.35
1,845.85
21,441.94
10,904.15
22,171.58
61,064.72
1,921.57
2,271.11
76.59
870.49
10.13
113.36
1,246.42
119.10
28.86
8,142.60
1,288.19
1,030.99
2,542.17
2,244.87
2,132.94
928.49
862.92
336.50
1,514.41
736.11
2,415.78
181.17
21.60
112.06
1,577.58
4,294.90
2,162.70
1,874.36
4,526.22
546.22
1,947.22
736.19
$ 562.524.15
IMPROVEMENT IN ONTARIO FOR 1945
53
District
Parry Sound: —
Highway No. II
No. ()9
Development Roads —
Rosseau-Hayt's Corners
Highway No. 1 1 -Highway No. 69.
Burks Falls-Highway No. 09
Dunchurch-Ardbfg
Sundridgc-Magnetawan Spur
Highway No. ()9-Bayfield Inlet . . .
Powassan Westerly
Trout Creek-Loring-Restoule
Barrie-Parry Sound
Wallhridge Township
Unincorporated Townships — -
Conger Township
Montieth Township
Bethune Townshij)
Proudfoot Township
Spence Township
Ferguson Township
Burpee Township
Croft Township
Laurier Township
Lount Township
Ferrie Township
McKenzie Township
Wallhridge Township
North Wallhridge and Henvey
Townships
Construction
184.01
171.43
222.37
Maintenance
$ ()2,4S()..j.J
o0,88').26
8,342.86
16,357.14
50,694.53
4,462.43
13,134.18
311.87
13,281.89
38.325.53
752.30
577.12
1 ,495.00
1,044.54
960.99
2,578.83
742.12
65.38
2.909.01
1.163.24
2,042.73
103.19
1 .572.93
834.32
1,558.21
Total
62,480.55
51,069.27
8.342.86
16,357.14
50,694.-53
4,462.43
13,134.18
311.87
13,281.89
38,496.96
222.37
752.30
577.12
1,495.00
1,044.54
9()0.99
2,578.83
742.12
65.38
2.909.01
1.163.24
2.042.73
103.19
1 ,572.93
834.32
1,558.21
577.81
$ 276,676.15 I $ 277,253.96
54
REPORT UPON HIGHWAY
No. 32
District
Temiskaming : —
Highway No. 11
No. 65
No. 66
Development Roads —
Lorrain Road
Haileybury West Road
North Temiskaming Road
North Road
McCool-Thornloe-Earlton
Charlton Road
Boston Creek and Spurs
Charlton Elk Lake Road
Gowganda Road and Spurs
Larder Lake Station Road
Kenogami Station Road
Sesekinika Road
Winston to Highway No. 11
Mining Roads —
Ashley Road
Silverado Road
Bidgood Road
Martin-Bird Road
Crystal Beach and Upper Canada
Cheminis Road
Unincorporated Townships —
Lorrain Township
Firstbrook Township
Ingram Township
Pense Township
Marter Township
Pacaud Township
Robillard Township
Sharpe Township
Bryce Township
Beauchamp Township
Savard Township
Henwood Township
Cane Township
Tudhope Township
Marquis Township
Otto Township
Eby Township
Gillies Limit
Benoit Township
Morrisette Township
Construction Maintenance
6,547.53
6.08
66,320.60
6,522.83
1,972.29
147.03
361.12
982.56
573.89
590.95
71,133.32
50,938.34
121,000.94
4,577.04
7,968.70
6,864.33
9,532.74
1,926.70
8,264.27
1,626.31
4,459.50
28,324.04
126.87
339.45
2,435.26
4,534.92
739.67
549.19
1 ,546.73
228.22
1,099.14
54.00
3.25
1,457.84
39.00
7,816.92
2.371.68
3,038.18
1 286.20
265.57
3,055.92
3,456.06
3,360.48
1,613.45
112.20
1,657.35
1,542.48
1 ,349.04
14.90
942.38
2,000.00
$ 84,024.88
$ 363,652.58
Total
77,680.8.5
50,944.42
187,321.54
4,577.04
7,968.70
6,864.33
9,532.74
1,926.70
14,787.10
3.598.60
4.459.50
28,324.04
126.87
339.45
2,435.26
147.03
4,534.92
739.67
549.19
1 ,546.73
228.22
1,099.14
54.00
3.25
1,457.84
39.00
8,178.04
3,354.24
3,612.07
1 ,286.20
265.57
3,646.87
3,456.06
3,360.48
1,613.45
112.20
1 ,657.35
1.542.48
1.349.04
14.90
942.38
2,000.00
$ 447,677.46
IMPROVEMENT IN ONTARIO FOR 1945
55
District
Cochrane: —
Highway No. 11
No. 67
No. 101
Development Roads —
Munro Road
Baysidc-Beach Road
Shillington-Iroquois Road
Timmins Back Road
Sandey Falls West Road
Holtyre Road
Coulson Road
Matheson Easterly
Nellie Lake-Iroquois Falls
Iroquois Falls-Monteith Road. . .
Cochrane-Norembega Road
Cochrane-Gardiner Road
Moonbeam -Remi Lake Road . . .
Hearst-Lake St. Therese Road. . .
Coppell-Meadc Road
Hearst -Coppell Road
Mining Roads —
Kamiskotia Road ,
Spurs off Timmins Back Road. . . ,
Goldhawk Road
Aquarics Porcupine Road
Night Hawk Lake Road
Unincorporated Townships —
Beatty Township
Bond Township
Bowman Township
Carr Township
Clergue Township
Currie Township
German Township
Hislop Township
Matheson Township
McCann and McEavy Townships.
Mount joy Township
Shaw Township
Stock Township
Taylor Township. . . .,§
Walker Township
Macklem and Thomas Townships .
Murphy Township
Pyne Township
Fox and Brower Townships
Kennedy Township
Lamarche Township
F'ournier Township
Clute-Frederickhouse Section
Township
Clute and Leitch Townships
Nansen Township
McCart Township
Newmarket Township
Brower Township
Blount Township
Clute Township
Calder Township
Colquhoun Township
Kendry Township
Haggart Township
O'Brien Township
Owens Township
Williamson Township
Idington Township
Eilber Township
Hanlan Township
Construction
$ 34,652.13
89.46
234.13
94.27
44,205.10
8,000.00
8.00
840.35
248.53
$ 88.371.97
Maintenance
S 283,749.71
85,522.39
23,489.01
3,643.78
2,332.11
27,665.79
12,28.5.67
5,570.94
1,685.17
284.53
737.17
997.99
8,473.83
5,993.81
1,231.22
3,881.06
4.436.56
40.33
2,979.11
230.08
62.05
119.80
1 ,009.36
169.12
62.83
2,456.98
27.00
4,229.44
202.15
22.50
12,255.44
1,041.12
936.37
436.31
34.40
1,364.90
898.00
2,300.77
1.906.32
1,766.17
3,089.15
3.893.88
1,886.97
3,796.03
788.01
186.31
55.00
344.97
1,469.22
392.58
59.17
59.83
223.25
204.73
64.50
201.18
15.50
40.00
20.00
101.54
$ 523.423.11
Total
318,401.84
85.611.85
23,489.01
3,643.78
2,332.11
27,665.79
12,285.67
5,570.94
1,685.17
284.53
234.13
737.17
997.99
8.473.83
5.993.81
1.231.22
3,881.06
94.27
4,436.56
40.33
2,979.11
44,435.18
8,000.00
8.00
62.05
119.80
1.009.36
169.12
62.83
2.456.98
27.00
4,229.44
202.15
22.50
13,095.79
1,041.12
936.37
436.31
282.93
1,364.90
898.00
2,300.77
1,906.32
1,766.17
3,089.15
3,893.88
1,886.97
3,796.03
788.01
186.31
55.00
344.97
1.469.22
392.58
59.17
59 83
223.25
204.73
64.50
201.18
15.50
40.00
20.00
101.54
$ 611.795.08
56
REPORT UPON HIGHWAY
No 32
District
Sudbury; —
Highway No. 17
No. 68
No. 69
Development Roads —
Hagar North Road
Wahnapitae-Wanup Road
vSudbury Highway No. 17-
Falconbridge
Garson-Skead
Hanmer-Bailey's Corners
Sudbury-Milnet
Sudbury-Frood
Sudbury-Levack
Highway No. 69-Long Lake
Kelley Lake-Long Lake
Highway No. 17-Creighton Mine
Whitefish-Lake Penage
Chapleau South
Gogama-Three Duck Lake
Metagama-Round Lake
Sudbury-Capreol
Burwash-Lake Nipawassi
French River-Lavigne
Sudbury-Burwash
Old Overhead-Shakespeare Township .
Espanola-Lake Penage
Unincorporated Townships —
Norman Township
Dieppe Township
Mongowin Township
Curtin Township
Foster Township
Hawley Township
Falconbridge Township
Caprcol Township
Lumsden Township
Morgan Township
Fairbank Township
Creighton Township
Lome Township
Louise Township
Snider Township
Trill Township
Secord Township
Burwash Township
Dill Township
Broder Township
Cleland Township
Dry den Township
Awrey Township
Loughrin Township
Construction
$ 12,873.53
622.29
888.18'
1,434.17
5,879.64
19,354.23
8,245.95
6,055.41
6.95
337.53
127.61
870.49
41.10
5.14
$ 56,742.22
Maintenance
$ 122,422.64
26,818.28
23,493.77
962.90
4,047.86
3,338.27
5,758.08
2,961.00
14,929.43
4.863.92
44,768.01
3,406.70
1,578.80
1,660.76
14,079.92
217.00
386.02
1,407.59
1.61
105.92
29.01
64.95
524.73
206.28
109.76
460.08
335.74
882.90
226.06
46.66
2,079.96
1 ,040.55
289.90
73.82
239.36
242.33
414.22
1,134.58
1,313.48
1,603.74
381.46
575.85
$ 289,483.90
Total
135,296.17
26,818.28
24,116.06
9(52.90
4,936.04
3,338.27
5,758.08
2,961.00
16,363.60
4,863.92
50,647.65
22,760.93
1.578.80
9,906.71
14.079.92
6.055.41
217.00
6.95
337.53
127.61
870.49
41.10
391.16
1,407.59
1.61
105.92
29.01
64.95
524.73
206.28
109.76
460.08
335.74
882.90
226.06
46.66
2,079.96
1 ,040.55
289.90
73.82
239.36
242.33
414.22
1.134.58
1.313.48
1,603.74
381.46
575.85
$ 346,226.12
IMiRGVEMENT IN ONTARIO FOR 1945
57
District
Alguma-Man'itouun: —
Highway No. 17
•• ' No. f)S
Development Roads —
Little Current -.South Bayniouth
Intersection, Little Current-South
Baymouth, West Bay and Minde-
moya-Gore Bay
South Baymouth-Gore Bay
Little Current -Gore Bay
Gore Bay-Meldruni Bay
Gore Bay-Meldruni Bay-Barrie
Island
Sable River Road
Old Highway No. 17-Algoma Mills. . .
Matinenda Road
Lake Dubornc Road
Mississauga River Road
White River Road
Thessalon-Wharncliffe Road
Bruce- Dunn \'alley Road
St. Joseph Island Belt Line
Gros Cap Road
Point Au.\ Pins Road
Searchmount-Wabos Road
Goulais Bay-White Birches Road. . . .
Batchawana Village Road
Michipicoten Area Roads
Hawk Lake Road ,
Iron Bridge-Chapleau
Mindemoya-Manitowaning
Preliminary Surveys
Unincorporated Townships —
Dawson Township ,
Robinson Township
Mills Township
Campbell Township
Sheshegwaning Indian Reserve
Manitoulin Island Unceded Indian
Reserve
Whitefish Indian Reserve
Shakespeare Township
Salter Broken Front Township
Victoria Township
Shedden Township
Lewis Township
Serpent River Reserve
Striker Township
Cobden Township
Mississauga Reserve
Patton Township
Bright Township
Gladstone Township
Parkinson Township
Grassette Township
Gould Township
Wells Township
Kirk wood Township
Bridgland Township
Houghton Township
Galbraith Township
Rose Township
Plummer Township
Aberdeen Township
Construction
S 40,800.66
58,317.52
4,133.07
1.24
5,587.22
8,298.65
Maintenance
$ 267,251.72
36,966.19
29,539.61
17,875.25 I
18,316.28
44.323.76
11,446.67
1.297.87
82.38
85.77
243
7,856
1,496
2,003
1,805
22,245
1,844
4,270
5,648
42,212
10810
1,037
28,()24
757
1,979
4,726
70
82
47
71
86
42
54
67
77
73
70
43
70
49
78
22
.49
88
439.73
1,464.32
973.49
2,716.83
191.44
1,520.44
74.59
2,627.46
72.86
2,823.97
781.10
188.41
10.50
594.60
44.00
269.92
1,124.53
263.06
2,121.21
49.50
75.13
133.22
559.33
250.30
579.01
396.15
1,494.30
317.65
1,278.34
1,835.35
Total
308,052.38
95,283.71
33,672.68
17,875.25
18,317.52
49,910.98
19,745.32
243.82
7,856.47
1.496.71
2,003.86
1.805.42
22.245.54
1,844.67
4,270.77
5.648.73
42,212.70
10,810.43
1,037.70
28,624.49
757.78
1,979.22
4,726.49
70.88
1.297.87
82.38
85.77
439.73
1.464.32
973.49
2.716.83
191.44
1.520.44
74.59
2.627.46
72.86
2.823.97
781.10
188.41
10.50
594.60
44.00
269.92
1.124.53
263.06
2.121.21
49.50
75.13
133.22
559.33
250.30
579.01
396.15
1,494.30
317.65
1,278.34
1,835.35
58
REPORT UPON HIGHWAY
No. 32
District
Algoma-Manitoulin — Cont.
Unincorporated Townships — Cont.
Garden River Reserve
Pennefather Township
Fenwick Township
Vankoughnet Township
Hodgins Township
Gaudette Township
Shields Township
Haviland Township
Whitman Township
Curtis Township
3-H Ranger Lake Road Township. .
Kars Township
Spanish Reserve
Fisher Township
Morin Township
3-E Township
Fort William: —
Highway No. 11
No. 17
No. 17A
No. 61
Development Roads —
Oliver Road
Silver Mountain Road
Kakabeka-Nolalu Road
Hymers-Scoble Road
Pearson-Pardee Loop
Kashabowie Road
Devon Road
Nipigon-Hydro
South Lybster Road
Dog Lake Road
Silver Islet Road
Nakina
Armstrong
White River
Sand River
Mining Roads —
Leitch Gold Mine Road
Unincorporated Townships —
Marks Township
Lybster Township
Strange Township
Devon Township
Scoble Township
Pearson Township
Dawson Road Lots
Forbes Township
Goldie Township
Upsala Township
Gorham Township
Ware Township
Jacques Township
Fowler Township
Sibley Township
Dorion Township
Stirling Township
Lyons Township
Construction
$ 118,604.38
$ 43.135.73
22.012.56
94.71
6,380.41
552.19
76.11
191.53
4,173.95
Maintenance
4,033.49
1,211.67
112.48
194.39
945.08
1,113.30
337.85
165.59
1,196.20
409.40
170.26
45.00
1,187.61
169.08
248.65
740.51
$ 76.617.19
$ 600,906.46
$ 74.793.45
331,448.34
34,422.41
53,894.53
20,618.76
20,580.61
13,096.58
19,627.55
16,106.14
4,488.82
2,429.08
12.111.34
8,673.84
715.93
266.10
367.16
160.18
1,409.67
2,782.04
1,375.76
427.99
1,573.46
1,524.05
2,051.71
2.152.61
255.17
800.60
4,072.32
5,294.61
1.041.23
163.77
819.98
2.192.22
752.06
11.02
Total
4.033.49
1.211.67
112.48
194.39
945.08
1,113.30
337.85
165.59
1,196.20
409.40
170.26
45.00
1,187.61
169.08
248.65
740.51
$ 642,501.09
$ 719,510.84
$ 117,929.18
353,460.90
34,517.12
60,274.94
20,618.76
20,580.61
13,096.58
20,179.74
16,106.14
4,488.82
2,429.08
76.11
191.53
12,111.34
8,673.84
715.93
266.10
367.16
160.18
4,173.95
1,409.67
2,782.04
1,375.76
427.99
1,573.46
1.524.05
2.051.71
2.152.61
255.17
800.60
4,072.32
5,294.61
1.041.23
163.77
819.98
2.192.22
752.06
11.02
$ 719,118.28
IMPROVEMENT IN ONTARIO FOR 1945
59
District
Kenora: —
Highway No. 17
No. 70
No. 72
Development Roads —
Dyment Road
Rice Lake School Van Road. . . .
Richan Road
Eton-Rugby Road
South Aubrey Road
Quibell, Clay Lake Road
East Melick-Coker Road
Rabbit Lake Road
Redditt Road
Pellatt Loop Road
Mining Roads —
Madsen-Red Lake Road
Central Patricia to Hooker's
Landing
Lunward Gold Mine Road
Quibell-Rcd Lake
Unincorporated Townships —
Aubrey Township
Boys Township
Britton Township
Code Township
C. P. R. No. 38 Township
Eton Township
Godson Township
Godson and Philip Townships . .
Jordan Township
Kirkup Township
Melgund Township
Mutrie Township
Pellatt Township
Redvers Township
Rowell Township
Rugby Township
Southwork Township
Vermilion Additional Township.
Wabigoon Township
Wainwright Township
Zealand Township
Unorganized Territory South of
Haycock Township
Unorganized Territory South of
Jaffray Township
Unorganized Territory South of
Melgund Township
Unorganized Territory South of
Pellatt Township
Construction
$ 1,737.59
12.26"
5,999.51
665.55
536.58
2,000.00
36,281.02
Maintenance
$ 122,773.53
87,616.15
40,881.74
247.16
2.640.17
5.164.65
3,269.99
4.696.91
4.627.89
5.870.08
3,793.42
6.404.45
22,973.28
100.17
33.55
1.090.26
91.91
$ 48,548.34
802.66
684.96
745.54
131.61
2.347.67
24.40
39.50
99.20
140.42
830.42
3.382.77
2,147.84
4.95
1.084.52
883.84
1.239.14
1.587.97
2.922.94
1.450.97
3,502.64
4.41
11.46
259.94
224.46
$ 335,513.65
Total
124,511.12
87.616.15
40.893.94
247.16
2,640.17
5,164.65
3,269.99
4,696.91
4,627.89
5.870.08
3.793.42
6.404.45
28,972.79
665.55
536.58
2.000.00
36.281.02
802.66
785.13
745.54
33.55
131.61
2.347.67
1,114.66
39.50
99.20
232.33
830.42
3,382.77
2,147.84
4.95
1.084.52
883.84
1,239.14
1.587.97
2.922.94
1.450.97
3,502.64
4.41
11.46
259.94
224.46
384,061.99
60
REPORT UPON HIGHWAY
No. 32
District
Rainy River: —
Highway No. 70
•• ' No. 70A
No. 71
Development Roads — ■
Stratton Road
Sleeinan Road
Spohn-Dearlock Road
River Road
Crozier Road
Devlin Road
Clearwater Lake Road
Arbor \'itae Road
Unincorporated Townships
Miscampbell Township
Dance Township
Sifton Township
Dewart Township
Sutherland Township
Nelles Township
Spohn Township
Unorganized Territory
Construction Maintenance
Slock (Materials, etc.j*
Lands and Buildings
Weigh Scales
Road Equipment, etc
Division Offices Expense and
Engineering
Net General Expense, etc. ...
1,704.68
1,132.88'
214.79
189.00
45.70
34.95
83.15
$ 3,405.15
52,148.83
29,568.53
$1,129,745.35
31,756.15
4,399.97
61,650.78
9.189.06
9.128.75
26.245.63
41,817.83
3,877.80
18.656.97
2.537.88
6.703.16
840.57
657.26
1,067.27
652.92
1,135.02
1,743.77
631.39
40.00
222,732.18
2.716.78
90.596.81
9.781. .58
518.235.82
454.393.71
87.6.50.09
Total
33.460.83
4,399.97
62,783.66
9,403.85
9,317.75
26,291.33
41.8.52.78
3.877.80
18,6.56.97
2.537.88
6.703.16
840.57
657.26
1.150.42
652.92
1,135.02
1,743.77
631.39
40.00
226,137.33
2,716.78
142.745.64
9.781.58
518.235.82
454.393.71
117.218.62
$13,003,667.39 | $14,133,412.74
Inventories, March 3lst, 1946 S 839,295.45
Inventories, March 3Ist, 1945 836,578.67
Increase $ 2,716.78
IMPROVEMENT IN ONTARIO FOR 1945
01
APPENDIX No. 2
GROSS EXPENDITURE BY ROADS
April 1st, 1945, to March 3l8t, 1946
Highway |
No
Location
Mileage
Construction
Maintenance
Total
2
Windsor-Quebec Boundary. . .
541.1
$ 22,046.12 1
$ 730,525.23
$ 752,571.-35
2A
Hamilton West Limits-
Campbells Corners
4.20
5..326.19
13.330.96
18,657.15
2B
Highway No. 2 (Howard Ave-
nue - Highway No. 3, Dou-
5.89
325.08
325.08
3
Windsor-Fort Ivrie
260.
5,164.30
236.453.97
241.618.27
3A
Chambers Corners-St.
Catharines-Niagara Falls. .
24.8
1,293.09
10.481.26
11,774.35
3B
Junction Highway No. 3-
Windsor
6.
511.58
2.580.55
3,092.13
3C
Ridgeway-Fort Erie
7.5
22.12
3.674.55
3.696.67
4
Port Stanley-Flesherton
155.5
5.147.53
195,477.10
200.624.63
o
Toronto- Paris
64.01
8,617.28
158,974.20
167,591.48
5A
Leaside-Kingston Road
Port Dover-Tobermory
8.4
15.568.95
15.568.95
6
225.1
14,086.41
237.743.75
251.830.16
7
Sarnia-Ottawa
465.
5,567.71
497,449.48
503.017.19
7A
Manchester-Peterborough. . .
42.
225.93
29.()2().34
29.246.27
8
Niagara Falls-Goderich
155.7
6.219.17
208.609.72
214.828.89
8A
St. Davids-Niagara Falls. . . .
2.96
1 ,722.00
2,894.30
4.616.30
9
Schom berg- Kincardine
112.8
2.277.39
94,162.49
96.4.39.88
10
Port Credit -Owen vSound . . . .
105.
755.27
107,-589.46
108.344.73
11
Toronto-Hearst -Geraldton-
Nipigon
903.85
92.61 i.s;i
874,650.77
967.262.(50
12
Whitiiy-Midland
97.7
1 ,930.05
296.620.88
298.550.93
] 1
Picton-Marmora
51.4
S,37
25.129.63
25.138.00
if)
Ottawa-Kingston
131.
1.451.t)()
121.526.37
122.978.03
1()
Ottawa- Prescott
62.3
3.694.82
40,280.81
43,975.63
17
Quebec Boundary - Montreal
River and Schrcibcr-Mani-
toba Boundary
1133.7
IK). 225.53
1.198.800.91
1.315,026.44
17A
Port Arthur-Highway No. 17.
21.1
94.71
34.422.41
34.517.12
18
Leamington- Windsor
49.
144. .S3
18,856.22
19.001.05
18A
Kingsville-Highwav No. 18. .
18.
1.217.63
14,051.26
15,268.89
18B
Rulhven-Highway No. 18. . .
Port Burwell-Tralee
1
495.29
495.29
19
92.2
1,856.08
47,582.59
49,438.67
20
Niagara Flails- Burlington . . . .
53.3
1,696.96
54,708.90
56,405.86
20A
Junction Highwav No. 20-
Hamilton Limits
1.36
207.
14,662.19
617.88
295,566.44
617.88
21
Morpeth-Owen Sound
310.228.63
22
London-Sarnia
66.8
1 ,020.82
19,712.82
20.733.64
23
London- Arthur ....
86. 3
942.53
55.075.63
56,018.16
24
Port Dover-Collingwood
143.4
10,623.97
123,658.95
134.282.92
24A
Paris Gait . . .
13 1
12,694.95
12,694.95
25
Burlington-Acton
Barrie-Owcn vSound
29 8
22,030.46
22.030.46
26
74.6
1,403.96
55,840.97
57,244.93
27
Long Branch-Midland-
Penetang
91.8
628.47
201,142.55
201.771.02
28
Port Hope-Apsley-Bancrof t . .
95.5
17,725.69
114,819.84
132.545.53
29
Brockville-Arnprior
76.4
8,197.07
182,980.82
191.177.89
30
Brighton-Havelock
32.
521.44
59,917.49
60.438.93
31
Morrisburg-Ottawa
48.4
4,267.72
47,576.56
51.844.28
32
Gananoque-Smith's Falls. . . .
Marmora-Trenton-Kingston .
47.9
4,265.09
4.265.09
33
101.3
496.54
61, .591. 70
62.088.24
34
Lancaster-Hawkesbury
38.1
12.230.52
49,254.48
61.485.00
35
Newcastle-Huntsville
144.2
7.348.22
136,084.00
143.432.22
36
Lindsay-Burleigh Falls
47.5
7.64
33,150.85
33.158.49
37
Belleville-Actinolite
29.3
71.234.02
72,138.64
143.372.66
38
Kingston-Sharbot Lake
47.1
353.97
44,408.94
: 44,762.91
39
Windsor-Belle River
21.5
780.12
4,109.61
1 4.889.73
40
Sarnia-Chatham
50.1
4.835.20
76.170.85
1 81.006.05
41
Picton-Golden Lake
140.6
1 4,388.54
132.123.54
136.512.08
62
REPORT UPON HIGHWAY
No. 32
APPENDIX No. 2
GROSS EXPENDITURE BY ROADS
April 1st, 1945, to March 31st, 1946
Highway
No.
Location
42 Brockville-Westport
43 Alexandria-Winchester
44 Almonte-Carp
45 Cobourg-Norwood
46 Highway No. 7-Coboconk .
47 Highway No. 12-StoufFville.
48 Port Bolster-Beaverton
49 Kleinburg Junction-
Highway No. 50
50 Highway No. 7-Highway No.
9 via Bolton
51 Highway No. 24-Highway
No. 10, Caledon
52 Wentworth County Line-
Highway No. 2
53 Woodstock-Highway No. 20 .
54 Cain.sville-Cayuga
55 Highway No. 53-Hamilton. . .
56 Junction Highway Nos. 53
and 20, Canfield
57 Bismark-Highway No. 3A. . .
58 Welland-Humberstone
59 Woodstock- Delhi
60 Huntsville-Lake Dore
61 Fort William-United States
Boundary
62 Madoc-Pembroke
63 North Bay-Temiskaming . . . .
64 Sturgeon Falls-Martin River
65 New Liskeard-Matachewan. .
66 Winston-Quebec Boundary .
67 Iroquois Falls-Timmins
68 McKerrow-Little Current
69 Atherley-Britt
70 Kenora-Fort Frances
70A Berwick Junction-Highway
No. 70
71 Fort Frances-Rainy River. . . .
72 Dinorwic-Sioux Lookout-
Hudson
73 Port Bruce- Dorchester Road.
74 New vSarum-Nilestown
75 Wallacetown-Dutton
76 Eagle-West Lome
77 New Glasgow-Rodney
78 Wallaceburg- Dresden
79 Highway No. 2- Watford
80 Highway No. 2-Alvinston.. . .
81 Delaware-Grand Bend
82 Highway No. 7-Port Franks.
83 Highway No. 21-Highway
No. 23 via Dashwood
84 St. Joseph-Hensall
85 Kitchener-Elmira
86 Amberley-Highway No. 7. . . .
87 Bluevale-Harriston
88 Bondhead-Bradford
89 Primrose-Cookstown
90 Angus-Allendale
91 Duntroon-Stayner
92 Elmvale-Wasaga Beach
93 Crown Hill-Waverley
Mileage
43.
40.4
14.
33.
34.
19.
6.
3.35
18.
2.5
18.5
53.7
27.
4.
15.5
9.
6.5
26.5
133.7
40.
135.
41.
34,6
66.7
33.7
43.6
38.
112.
143.
14.
60.
52.5
23.
14.
2.5
3.5
4.
10.5
25.5
13.
44.
7.
24.
10.5
12.
79.
19.5
6.
23.5
11.
5.2
9.
17.5
Construction
797.18
1,649.35
1,582.31
1,902.00
234.34
105.65
440.53
998.34
2,801 .08
Maintenance
21,307.08
625.87
469.40
1,714.59
3,941.53
6,380.41
8,794.35
1,355.80
1,985.40
6.08
66,320.60
89.46
58,317.52
3,365.15
1,704.68
1,132.88
12.20
169.51
727.69
69.49
5.58
420.60
3,034.14
2,869.49
1,885.14
195.91
204.09
114.40
96,331.04
26,121.43
18,394.11
34,692.81
30,213.19
31,102.21
11,645.51
3,399.78
22,823.92
2,874.22
11,091.92
35,844.48
40,463.14
2,972.04
104,682.70
8,213.97
57,058.39
46,784.10
118,664.35
53,894.53
182,775.97
37,132.26
23,013.61
50.938.34
121,000.94
85,522.39
63,784.47
107,369.45
119,372.30
4,399.97
61,650.78
40,881.74
22,571.62
9,763.26
1,186.69
4,658.05
1,977.85
3,864.28
22,989.01
13,250.26
38,092.96
74,814.55
30,060.88
11,489.90
4,876.39
96,267.02
14,645.63
6,768.53
37,525.34
19,679.75
7,331.33
4,014.14
13,323.34
Total
97,128.22
27,770.78
19,976.42
36,594.81
30,447.53
31,207.86
11,645.51
3,399.78
22,823.92
3,314.75
11,091.92
36,842.82
43,264.22
2,972.04
125,989.78
8,839.84
57,527.79
48,498.69
122,605.88
60,274.94
191,570.32
38,488.06
24,999.01
50,944.42
187,321.54
85,611.85
122,101.99
110,734.60
121,076.98
4,399.97
62,783.66
40,893.94
22,741.13
10,490.95
1,186.69
4,727.54
1,983.43
3,864.28
22.989.01
13,250.26
38,513.56
77,848.69
30,060.88
11,489.90
4,876.39
99,136.51
16,530.77
6,768.53
37,721.25
19,883.84
7,445.73
4,014.14
13,323.34
IMPROVEMENT IN ONTARIO FOR 1945
63
APPENDIX No. 2
GROSS EXPENDITURE BY ROADS
April Ist, 1945, to March 31st, 1946
Highway
No.
Location
Mileage
Construction
Maintenance
Total
94
95
96
97
98
98A
99
100
101
Callander-Highway No. 17. . .
Wolff Island North and
South
Wolfe Island East and West .
Hickson-Freelton
Windsor-Tilbury
Si.\ Corners, Highway No. 98-
Maidstont-, Highway No. 3.
Dundas- Junction Highway
No. o8and No. 24
Thamesford-Highway No. 7. .
Highway No. 1 1 at Matheson-
No. ()7 West of Hoylc
Queen Hlizabeth Way
Burlington Beach Cut-off. . . .
Ottawa By-pass
Proposed Four-Lane High-
way North of Kingston. . . .
Howe Island Ferry Road . . . .
St. Lawrence River Road. . . .
Four-Lane Highway Toronto-
Oshawa liast
Proposed Highway Toronto-
Barrie
Wauhaushene-Port vSevern. . .
Wolfe Island I'erry
Malton Airport Road
St. Thomas F^ntrance
Pelee Island
Middle Road, Tilbury-
Blenheim
Lanark County Road 4C. . . .
ChafFey's Locks Road
(Jueen Street -Lake Shore
Road-Brown's Line
Dundas Diversion
Miscellaneous Surveys (Con-
trolled Access Highways,
etc.)
7.
20.
44.5
34.5
1. 1
16.5
15.
1 ,500.63
540.85
Total King's Highways,
Brought Forward
Total Development Roads. . .
Total Mining Roads
Total Connecting Links
Total Unincorporated
Township Roads
Stock (Materials, etc.)*
Lands and Buildings
W'eigh Scales
Road Equipment, etc
Division Othces Expense and
Engineering
Net General Expense, etc. . . .
Etc.
Cr.
30,859.09
234.69
1.749.43
1 ,055.54
3,937.52
74.60
45,706.82
89.005.24
478.27
5,071.15
15.04
3,287.41
5,418.09
10,782.55
28,403.03
13,980.43
545.64
22,272.46
17,642.97
23,489.01
475,919.21
4,133.04
Cr.
52,263.83
72,430.35
9,674.79
$848,911.66
848,911.66
96,105.39
95,870.20
2,227.45
4,913.29
'52,148.83
4,706.94
338.40
3,167.22
47,886.08
1 .040.00
233.91
9,528.87
7,146.68
3,287.41
5,418.09
10,782.55
29,903.66
14,521.28
545.64
22,272.46
19,429.09
23,489.01
506,778.30
4,367.73
1,749.43
1 ,055.54
3,937.52
52,338.43
118,137.17
89,005.24
5,185.21
5,071.15
15.04
338.40
3.167.22
47,886.08
1 .040.00
233.91
9,528.87
7,146.68
9,674.79
29,568.53
$1,129,745.35
59,975,798.35
9.975.798.35
1,556.748.93
11,957.52
38,821.00
256,966.80
2,716.78
90,596.81
9,781.58
518,235.82
454,393.71
87,650.09
$13,003,667.39
$10,824,710.01
10,824.710.01
1.652,854.32
107,827.72
41,048.45
261,880.09
2,716.78
142,745.64
9,781.58
518,235.82
454,393.71
117,218.62
$14,133,412.74
Inventories. March .31st, 1946..
Inventories. March 31st, 1945.,
839.295.4,S
836,578.67
2,716.78
64
REPORT UPON HIGHWAY
No. 32
APPENDIX No. 3
SCHEDULE OF ASSUMPTIONS AND REVERSIONS OF SECTIONS OF THE KING'S
HIGHWAY SYSTEM FOR THE FISCAL YEAR ENDING MARCH 31st, 1946.
Assumptions
District or
County Location of Road
Rainy River Emo \'illage
Sudbury McKerrow South
Assumed by Land Plan
Date
Assumed
Dec. .5, 194.5
Nov. 14, 194.5
Algoma Bruce Mines W
Algoma Macdonald Township (Garden River, I.R.J
Cochrane Highway No. 1 1 (Revised Mileage)
Frontenac Oso Township
Frontenac Olden and Oso Townships
Frontenac Olden Township
Frontenac Hinchinbrooke Township
Frontenac Hinchinbrooke Township
Frontenac Hinchinbrooke Township
Frontenac Pittsburgh Township
Frontenac Portland Township
Frontenac Portland, Hinchinbrooke Townships
Kenora Highways No. 17, 70, 72 (Revised Mileage).
Lennox and
Addington Fredericksburg Township
Leeds Elizabethtown Township
Manitoulin Highway No. fiS (Revised Mileage)
Rainy River Crozier Township
Rainy River Devlin Township
Rainy River Emo
Rainy River Potts Township
Sudbury Hallam, Shakespeare and Baldwin Town-
ships
Temiskaming Englehart N.W
reversions
Location of Road
District or
County
Algoma Bruce Mines \V
Algoma Macdonald Township (Garden River, I.R.).
Frontenac Oso Township
Frontenac Olden and Oso Townships
Frontenac Olden Township
Frontenac Hinchinbrooke Township
Frontenac Hinchinbrooke Township
Frontenac Hinchinbrooke Township
Frontenac Pittsburgh Township
Frontenac Portland Township
Frontenac Portland and Hinchinbrooke Township
Lennox and
Addington Fredericksburg Township
Leeds Elizabethtown Township
Muskoka Gravenhurst Town
Peterborough Peterborough City
Peterborough Peterborough City
Peterborough Peterborough City
Rainy River Crozier Township
Rainy River Devlin Township
Rainy River Emo Township
Rainy River Potts Township
Sudbury Hallam, Merrill and Baldwin Townships.. .
Temiskaming Englehart N.W
Date Reverted
Feb.
17
1946
Feb.
17
1946
Oct.
8
1945
Oct.
12
1945
Oct.
8
1945
Oct.
8
1945
Oct.
8
1945
Oct.
8
1945
Oct.
8
1945
Oct.
8
1945
Oct.
8
1945
Oct.
9
1945
Oct.
8
1945
Mar.
18
1946
Mav 21
1945
May
21
1945
May
21
1945
Nov.
13
1945
Nov.
13
1945
Nov.
13
1945
Nov.
13
1945
Oct.
29
1945
Nov.
5
1945
38.54
Miles
1
30
3
70
0
06
0
27
0
72
1
45
0
70
1
20
0
47
0
15
1
74
0
36
0
53
1
30
0
55
1
65
0
85
2
18
1
95
1
06
3
05
10
50
3
07
38.81
66
REPORT UPON HIGHWAY
No. 32
APPENDIX
BRIDGES COMPLETED ON THE
Name
Type
Span
Road
Little Firesteel Bridge . . .
Little Long Lac Bridge . .
Milldale Bridge (Otter Ck.
Moncrief Twp
Pine Creek
Pitch Creek No. 1
Pitch Creek No. 2
Secord Twp
Slate River
Slate River
Slate River
Concrete Rigid Frame. .
Creosoted Timber
Concrete Rigid Frame..
Timber
Timber Pile
Creosoted Timber Truss
Creosoted Timber Truss
Timber
Creosoted Timber
Creosoted Timber
Creosoted Timber
1 at 40' .
No. 17, Fort Wil-
liam to English
River
Geraldton to High-
I way No. 11
1 at oO' I No. 59, Woodstock
to Delhi
9 at 14' 6".
1 at 30', 2 at 14', 2 i
at 17' j Sudbury to Benny.
3 at 15' Hagar to Rutter. . .
1 at 30' Township Road . .
1 at 30' Township Road . . .
3 at 13' No. 69, vSudbury to
Burwash
15', 15', 5', 50', 5',
15' Township Road . . .
15', 13', 13', 11'. . ., Township Road. . .
15', 5', 40', 5', 13'. i Township Road. . .
IMPROVEMENT IN ONTARIO FOR 1945
67
No. 4
KING'S HIGHWAYS DURING 1945
Township
Stedinan
Ashmore .
Lot
Not Surveyed.
Not Surveyed.
Norwich S | 7, 8.
Moncrief .
Haddo . . .
O'Connor.
O'Connor.
Secord. . .
Paipoonge .
Blake
Paipoonge .
7..
12.
10...
10...
11, 12.
Con.
VIII.
v..
Ill
County or District
Thunder Bay .
Thunder Bay .
Oxford
Sudbury .
Sudbury .
II-III ' Thunder Bay
Thunder Bay .
II-III
V
Sudbury .
II-III Thunder Bay.
I-II j Thunder Bay .
VI Thunder Bay .
Div.
No.
19
19
2
17
13
19
19
17
19
19
19
68
REPORT UPON HIGHWAY
No. 32
APPENDIX No. 5
GROWTH OF COUNTY ROAD EXPENDITURES AND PROVINCIAL GRANTS
Year Work was Done
Number of
Counties
Approved
Expenditure
1903.
1904.
1905.
1906.
1907.
1908.
1909.
1910.
1911.
1912.
1913.
1914,
1915
1916
1917.
1918.
1919.
1920.
1921.
1922.
1923.
1924.
1925.
1926.
1927.
1928.
1929.
1930.
1931.
1932.
1933.
1934.
1935.
1936.
1937.
1938.
1939.
1940.
1941.
1942.
1943.
1944.
1945.
4
7
6
8
14
15
16
17
19
20
20
20
20
21
30
36
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
37
Government
Grants
166,149.06
291.085.42
179,-593.62
247,102.37
383,518.86
429,393.57
440,374.08
5.53,312.61
712,072.52
898,631.18
847,684.15
785,-521.93
8 11, .540.05
9.55.447.19
1,388,.341.87
2,226,899.70
5,714,937.19
7,956,863.72
11,078,288.39
9,162,491.79
7,403,.509.96
6,861,451.62
6,608,431.04
5,838,445.12
7,424,464.85
8,784,420.42
9,212,7.58.04
8,929,424.27
7,265.3.50.65
4.214.410.70
3.058.622.91
3.391.768.96
3,107,215.32
3,438,188.53
4,062,753.39
4.686,333.38
4,775,109.01
4,496,702.25
4,805,301.60
3,221,505.02
3,951,745.47
4,675,028.89
5,692,079.85
.55,383.02
97,028.48
.59,864.53
82,367.45
127,839.62
143.131.16
146.791.36
184,437. .54
237.357.50
299,.543.69
282.561.35
261,840.61
270.513.34
327.663.76
483.621.32
815.440.01
2,623,719.24
3,626,418.08
5,119,882.26
4,2.58,339.83
3,418.523.07
3. 2 14, .321.. 50
3,222,678.10
2,913,660.96
3,706,719.88
4.360,222.86
4,.591, 110.16
4,463,527.11
3,625,860.66
2,106,457.18
1,529,228.37
1,695,291.35
1,. 5.53,273.39
1,718,944.63
2,031,372.49
2,342,971.65
2,387,240.73
2,247,977.06
2,402.650.75
1.610.7,52.54
1,975,872.73
2,365,507.20
2.898,135.97
Totals to Date $171,134,270.52
$81,886,044.49
IMPROVEMENT IN ONTARIO FOR 1945
69
APPENDIX No. 6
COUNTY ROAD MILEAGE AND EXPENDITURE
From Inception of County Road Systems to December 31st, 1945, Provincial
Subsidies on 1945 Expenditures Being Paid in 1946.
County
Year of
Estab-
lish-
ment
of
System
Road Mileages
County
Roads
County
Sub-
urban
Roads
Total
Total
Approved
Expenditure
to end of
1945
Total
Government
Grant
Brant
Bruce.
Carleton
Dufferin .
Elgin . . .
Essex . . .
Frontenac .
Grey
Haldimand
Halton. .
Hastings .
Huron . .
Kent
Lambton .
Lanark. .
Leeds and Grenvillc . . .
Lennox and Addington.
Lincoln
Middlesex
Norfolk
Northumberland and
Durham
Ontario
Oxford .
Peel . .
Perth
Peterborough
Prescott and Russell
Prince Edward.
Renfrew
Simcoe
Stormont, Dundas and
Glengarry
Victoria
Waterloo
Welland . . .
Wellington.
Wentworth .
York
Totals .
1917
1917
1910
1918
1917
1916
1907
1918
1912
1907
1904
1917
1917
1918
1903
1910
190(>
1904
1906
1917
191H
1918
1904-7
1907
1907
1919
1917
1907
1918
1903
1917
1917
1908
1912
1903
1903
1911
74. o
275.7
138.0
160.5
230.3
205.4
142.4
307.7
155.2
141.1
274.1
375.5
270.3
210.6
224.9
276.8
152.8
136.6
422.7
199.8
26.4
90.0
20.0
41.0
100.9
275.71
228. 0[
160.5
250.3
246.4
38.2 I 180.6
32.5 340.2
155.2
' 141.1
5.0 ' 279.1
I 375.5
9.7
14.5
6.0
12.7
12.3
54.1
280.0
225.1
230.9
289.5
152.8
148.9
476.8
199.8
230.7 1 230.7
186.2
179.3
121.9
150.7
120.9
303.1
176.9
220.0
259.4
433.3
183.2
154.8
105.0
310.0
99.6
71.0
16.2
3.9
7.5
76.4
7,680.9
30.0
25.2
16.9
23.5
53.0
264.2
202.4
183.2
121.9
158.2
197.3
303.1
176.9
220.0
259.4
463.3
183.2
180.0
121.9
333.5
152.6
335.2
879.2 18,560.1
3,118.113.74
4,441,459.38
8,272,630.04
1,800,290.21
3,580,787.87
7,049,355.79
2,215,540.31
4,6.52,173.68
3,607,085.82
2,988,878.88
4,161,863.92
4,050,194.90
6,661,801.95
3,374,427.19
3,418,825.41
4,843,252.28
3,129,864.66
4,997,815.75
5,641,406.49
4,764,248.94
2,98«),047.04
4,030,476.33
3,323,651.82
2,421,671.93
1 ,833,707.34
5,4.52,948.11
2.710.165.40
3.931.509.46
5.205.685.39
7.162.467.51
3,323.956.09
5,224,469.54
5,539,968.38
5.165.346.23
5.492.796.10
$1,550,822.72
2.213,196.54
3,936,389.69
863,762.79
1,719,693.32
3,469.066.15
1.041.761.15
2.307.782.77
1.703.480.10
1.402.054.83
1,954.108.12
1,968,809.88
3,338,559.44
1,638,216.01
1,632,288.59
2,279,316.99
1,519,608.04
2,239,008.69
2,639,572.45
2,296,451.30
3,930,843.56 ' 1,937,136.06
1,460,395.41
1,843,261.72
1,527,061.88
1,126,142.55
892,722.45
2,504,107.36
1,266,104.88
1.925.185.64
2.449.75().02
3,507,711.63
1,651.587.64
2.566.066.67
2.592,299.97
2,456,509.57
2,.562,711.52
16,628,543.08 1 7,903,333.95
$171,134,270.52 $81,886,044.4 3
70
REPORT UPON HIGHWAY
No. 32
APPENDIX
SUMMARY OF COUNTY
Roads
BRIDGEtl
Bridges and Cclvkrts
SPECIAL RATE
Name of Codntv
fon-
.Mainte-
Con-
Mainte-
Con-
Mainte-
.■struction
nance
struction
nance
.struction
nance
Brant
* l'J.772.29
$ .58.948.08
S 3.142.93
15.725.34
34,732.53
77.015.29
7.5.519.14
47.17
1.393.13
8.884.42
16..380..50
1 .066 1,2
Carl et on
Dufferin
36,405.90
29.588.18
14.00
868.01
Elgin
40.434.42
95,517.61
4.298.02
6.159.18
.551 . 1 1
Essex
60,060.75
76,528.51
89.70
33 390 64
30 920 40
568 45
Grey
63,894.30
78,402.06
7.783.78
Haldimand
15.5,949.24
61,050.93
132.77
5,110.42
Halton
40.910.80
.53.504.22
347.75
662.61
14.243.30
Hastings
21.212.38
66.044.73
800.70
1.266.80
Huron
44. .591. 65
58,.545.73
1.499.78
10.007. .56
Kent
114.145.01
152,640.64
1.4.58.78
43,742.10
28,282.86
59,139.43
403.36
Lanark
33.457.96
44.523 82
1.291.22
1.320.37
1.838.09
Leeds and Cirenvllle
1 10.495.86
34.812.91
1.815.47
325.93
1,183.55
1,671.84
Lennox and Addington
30.603.50
64,239.12
712.78
Lincoln
40,868.67
61,714.49
453.63
13,1,50.58
Middlesex-
61,434.99
110.920.01
4.662.32
827.04
Norfolk
43,913.66
87,472.89
1.103.23
Northumberland and
Durham
44,951.60
38,777.98
.50.747.70
69.257.97
210.77
928,92
Ontario
4,023.72
Oxford
28,665.82
61,743.96
1.083.00
472.39
2.887.25
Peel
28,990.60
60.853.08
924.46
390.39
13,415.66
Perth
18,772.29
54,007.07
919.72
1.065.90
28.004.58
53,656.07
1,518.06
2.036.65
Prescott and Russell
.59.165.51
124,462.70
1.421.58
14.778.12
20.346.86
49,536.63
Renfrew
19,761.07
90.573.44
665.54
6,851.01
SImcoe
30.476.45
102.294.40
7.54.47
4.488.00
7,393.57
1.709.08
.Stormont, Dundas and
Glengarry
40.162.75
99,332.45
.5.154.80
Victoria
48,146.24
31.143.21
259.44
Waterloo
35.587.97
99.066.26
638.77
Wetland
8 621 63
53 512 96
829 36
I 354 22
Wellington
93,108.69
104.965.14
1,009.52
1.743.25
Wentworth
,50,711.70
68.384.16
754.29
3,797.35
York
126,901.00
139,541.80
262.00
3.783.01
3.500.00
7.773.75
Totals -:
S 1.751.435.49
S 2,690,127.19
i .5.187.15
S 46. .505.07
$ 190,671.76
S 17.712.44
IMPROVEMENT IN ONTARIO FOR 1945
71
No. 7
ROAD EXPENDITURES
1945
Approved Expenditure
Government Subsidy 50%
Winter
Control
(Mainte-
Con-
Mainte-
Con-
Mainte-
nance)
struction
nance
Total
.struction
nance
Total
« 12,213.55
$ 19.772.29
$ 74.304.56
$ 94.076.85
S 9.886.15
$ 37.152.28
$ 47.038.43
l»,414.4g
24.609.76
97.-542.96
122.152.72
14.525.98
49.037.99
63.563.97
34.357.45
51.113(13
111.269.72
162.382.75
29,651.64
.55.634.86
85.286.50
12.662.58
37.273.91
42.264.76
79.538.67
18.853.95
21.132.38
39,986.33
12,843.52
46.593.60
113.210.26
159.803.86
24.836.59
56.742.91
81,579.50
12.047.27
60.060.75
88.665.48
148,726.23
30.0.30.38
44.332.74
74.363.12
15.248.63
33.390.64
46.737.48
80.128.12
16.695.32
23.368.74
40,064.06
27.064.00
71.678.08
105,466.06
177.144.14
37.784.99
.52.733.03
90,518.02
16.768.78
161.059.66
77,952.48
2.39.012.14
81.807.43
38.976.24
120,783.67
19.940.00
55,501.85
74,106.83
129,608.68
31,311.74
37.053.42
68,36.5.16
20.494.25
22.479.18
87,339.68
109,818.86
11, .5.56.29
43.669.84
.55.226.13
36.534.82
54..599.21
96,580.33
151,179.54
29.801.49
48.290.17
78.091.66
18,917.99
157,887.11
173,017.41
330,904.52
89.879.08
86.508.71
176,387.79
11.921.13
28.282.86
71,463.92
99,746.78
14.141.43
35.731.96
49,873.39
19.125.81
34,778.33
66,778.94
101,557.27
17.719.26
33,848.99
51.568.25
26.027.43
113,494.88
62.838.11
176.332.99
57.043.33
31,837.02
88.880.35
20,464.86
30,603. .50
85,416.76
116.020.26
15..501.75
42.708.38
58.010.13
19.039.02
.54,019.25
81.207.14
13.5.226.39
,30.297.27
40.603.57
70.900.84
29.699.57
62.262.03
145.281.90
207.543.93
31.337.78
72.640.95
103.978.73
13.820.55
43.913.66
102.396.67
146.310.33
21.956.83
51.198.34
73,15.5.17
27.604.93
44,951.60
78.563.40
123.515.00
22.475.80
39.281.70
61.757.50
31.012.83
42,801.70
101.199.78
144,001.48
22.406.78
.50.599.89
73.006.67
13,937.55
32,636.07
76.153.90
108,789.97
17.039.85
38.076.95
55.116.80
21,119.03
43,.330.72
82,362.50
12.5,693.22
25.019.27
41.181.25
66.200.52
15.631.38
18,772.29
71.624.07
90.396.36
9.386.14
36.078.52
45.464.66
10.957.64
28,004..58
68.168.42
96,173.00
14.002.29
34..593.37
48. .595.66
44,584.23
73,943.63
170.468.51
244,412.14
40.666.35
85.234.25
125.900.60
19.818.81
20,346.86
69,355.44
89,702.30
10.173.43
34.677.72
44.851.15
20.319.63
26.612.08
111,558.61
138.170.69
1.5.018.79
,55.779.31
70,798.10
32.424.04
38.624.49
140,915.52
179,540.01
21.160.64
70.885.03
92,045.67
83.331.43
40.162.75
187.818.68
227,981.43
20.081.37
93.909.34
113.990.71
15.723.26
48.146.24
47.125.91
95,272.15
24.073.12
23.562.95
47.636.07
22.107.16
35.587.97
121.812.19
157,400.16
17.793.98
60.906.10
78.700.08
21.705.01
9.975.85
76.047.33
86.023.18
.5.326.47
38.023.67
43.350.14
40.913.35
94.851.94
146.888.01
241,739.95
47.861.78
73.444.00
121.305.78
47.422.07
54.509.05
116,560.52
171,069.57
28.203.86
.58.280.26
86.484.12
123.222.65
130.663.00
274.321.21
404,984.21
66.206..50
139.104.04
205.310.54
990.440.75
1.947.294.40
3.744.785.45
5,692,079.85
1.021.315.10
1.876.820.87
2.898,135.97
72
REPORT UPON HIGHWAY
No. 32
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74
REPORT UPON HIGHWAY
No. 32
APPENDIX
MILEAGE OF ROAD SURFACES
COUNTY ROADS
Municipality
Earth
Gravel i
or
Stone
Bitu-
minous
Surfaces
Bitu-
minous
Pavement
Cement
Concrete
Brant
2.3
59.3
214.2
92.6
159.4
226.5
161.0
119.1
297.1
97.7
100.9
240.4
307.2
158.5
186.0
164.2
110.0
92.8
10.4
421.9
40.2
192.5
155.4
142.8
99 1
141.5
178.7
178.5
93.9
158.8
250.3
196.6
161.8
115.3
6.2
294.6
65.0
81.7
31.8
59.7
75.8
6.5
0.5
58.3
1.0
1.3
1.3
1.1
Elgin
23.6
34.6
61.5
42.4
43.6
18.9
20.1
67.8
95.1
36.5
41.5
77.3
30.0
123.0
14.4
154.6
2.5
42.2
40.4
6.8
16.7
18.6
79.9
65.5
43.9
8.9
265.5
18.4
36.6
83.0
26.0
80.3
148.3
0.2
Essex
5.1
45.7
Grey
0.7
Haldimand
Halton
4.2
5.8
3.9
21.3
Hastings
16.3
2.3
Huron
0.5
Kent
2.7
23.7
Lambton
2.6
Lanark
8.8
36.3
16.4
62.2
30.0
2.9
Leeds and Grenville
3.7
Lincoln
12.6
Middlesex .
40.5
Norfolk ....
3.8
1.2
35.7
Ontario
4.8
Oxford
Peel
10.6
5.4
Perth
Peterborough
Prescott and Russell
27.2
17.5
8.9
Prince Edward
8.6
Renfrew
17.3
Simcoe
0.2
Stormont, Dundas and Glengarry
1.2
3.0
Waterloo .... ....
28.1
Welland
22.4
10.3
Wellington
12.9
Wentworth
3.9
73.8
3.4
York
12.6
18.8
Total County Area
113.8
5772.1
2035.7
382.7
255.8
Unorganized — Township and Mining
Roads ....
Grand Totals
113.8
5772.1
2035.7
382.7
255.8
IMPROVEMENT IN ONTARIO FOR 1945
75
No. 9
AT THE END OF 1945
ORGANIZED TOWNSHIP ROADS
Total
Earth
Gravel
or
Stone
Bitu-
minous
Surfaces
Bitu- 1
minous Cement
Pavement Concrete
Total
100.9
95.3
228.7
324.6
149.0
58.0
71.5
446.6
410.0
136.9
34.8
372.0
208.0
141.1
231.6
560.5
534.5
277.7
246.1
150.5
407.1
916.6
246.3
17.0
88.0
70.8
304.5
623.1
56.4
1009.8
492 3
512.3
167.3
52.5
427.5
.546.9
98.1
514.1
452.4
1403.0
744.0
613.0
821.1
818.7
493.2
1663.4
455.5
397.4
1126.3
1349.4
1181.8
1202.6
425.0
806.3
377.9
408.2
1371.2
516.6
1333.0
932.4
1035.3
515.1
997.3
618.8
320.4
314.2
671 . 5
1614.4
807.2
763.7
483.8
392.9
768.4
465.2
1013.8
2.8
550 5
275.7
1631 7
228.0
7.6
0.6
1076 8
160.5
762 0
250.3
0.3
879 4
246.4
35.3
925 5
180.6
1.0
940 8
340.2
2073 4
155.2
9.7
602 1
141.1
1 2
433 4
279.1
1.0
1499 3
375.5
1.3
3.0
2.3
1.558 7
280.0
1325 9
225.1
1436 5
230.9
985 5
289.5
16.2
0.5
9.8
13.5
1370 5
152.8
656 1
148.9
3.6
0.2
667 7
476.8
1521 9
199.8
5.9
929 6
230.7
2249 6
202.4
0.2
5.3
1178 9
183.2
1057 6
121.9
603 1
158.2
0.2
1.4
1068 3
197.3
924 7
303.1
943 5
176.9
370 6
220.0
1681 3
259.4
2106 7
463.3
5.5
5.1
1330 1
183.2
931 0
180.0
0.2
2.1
0 4
536 5
121.9
333.5
111.0
9.2
942.7
1315 7
152.6
0.9
52.5
564 2
335.2
88.5
14.1
1683.0
8560.1
11228.0
29674.4
237.4
112.8
62.2
41314.8
1547.7
2978.0
4988.3
3008.6
69.2
10.3
6615 5
5986 6
8560.1
15753.7
37671.3
306.6
123.1
62.2
53916.9
76
HIGHWAY IMPROVEMENT IN ONTARIO FOR 1945 No. 32
APPENDIX No. 10
MUNICIPAL ROADS BRANCH
Graphs Showing Rise and Fall in Total Approved Expenditures by Organized
Municipalities and in Government Subsidies by Calendar
Work-Years from 1920 to 1945 Inclusive
MlO^Jin-OKCosO
s.ooo.ooo \-
e, 000,000
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/6,eoo, 000
/■*t>o 0,000
/i.OOO.OOO
/o, 000,000
For explanatory comments see "Report on the Work of the Municipal Roads Branch'
in the front section of this Annual Report.
REPORT OF MOTOR VEHICLES BRANCH, 1945 77
Report of the Motor Vehicles Branch, 1945
To The Honourable George H. Doucett,
Minister of Highways.
Sir:
I have the honour to submit herewith a report of the activities of the Motor Vehicles Branch
for the year 1945.
This report includes:
(Ij Figures relating to motor vehicle permits and drivers' licenses issued during the license
year ending March 31st, 1946;
(2 1 A statement showing the revenue derived from all sources during the fiscal year ending
March 31st, 194H; and
(3) Reports pertaining to the work of the Accident and Statistical Division, Financial
Responsibility Division, and the Public Vehicle Division for the year 1945.
The summarized information contained in the following preamble is dealt with in more detail
in the pages of this report :
Motor Vehicle Registrations
There were 662,719 motor vehicles registered during the year as compared with 675,057 for
1944, and 731,194 for the peak year, 1941. The 1945 total was 1.8 per cent, below the total for
the previous year, and 10.35 per cent, less than the 1941 total.
Drivers' Licenses
Chauffeurs' and operators' licenses issued during the year totalled 971,852, representing an
increase of 66,202 (or 7.3%J from the 1944 total, and a decrease of 1.5 per cent, from the peak
total (986,773) for 1941. As compared with the '7.3 per cent, increase in the number of drivers'
licenses issued, there was a 15.3 per cent, increase in chauffeur registrations, and an increase of
3.5 per cent, in the number of operators' licenses. There were 81,928 temporary instruction per-
mits issued representing an advance of 17.1 per cent, from the 1944 total.
Revenue
The net revenue collected during the fiscal year ending March 31, 1946, amounted to $9,774,-
584.92 as compared with $9,445,499.18 for the previous year, representing an increase in revenue
of $329,085.74 or 3.5 per cent.
Motor Vehicle Accidents
During the calendar year 1945 there were 13,458 reports of accidents received and recorded,
involving the loss of 598 lives, injury to 9,804 persons and a property damage loss of $2,249,271.
Corresponding figures for 1944 were: 11,004 accidents, 498 deaths, 8,373 injuries and $1,769,663
property damage loss.
Financial Responsibility Division
During 1945 there were 4,191 suspensions applied, requiring the filing of proof of financial
responsibility.
There were 25,898 convictions (involving the operation of motor vehicles) reported during
1945 as compared with 23,827 for the previous year — representing an increase of 8.7 per cent,
from the 1944 total.
Public Vehicle Division
There were 8,524 Public Commercial Vehicles licensed during the year — an increase of 327
or 4.0 per cent, from the previous year's total (8,197).
There were 1,750 Public Vehicles licensed as contrasted with 1.610 — representing an advance
of 140 or 8.7 per cent.
78 REPORT OF No. 32
General
The Motor Vehicles Branch having such widely diversified activities, a brief outline of these
may be of general interest.
Under the Highway Traffic Act all motor vehicles are registered and drivers licensed by the
Branch either directly through the head office in Toronto, or through the offices of agents through-
out the Province. Each day reports of permits and licenses issued by 205 representatives through-
out Ontario are received at the Branch.
A prerequisite to the issuance of a driver's license is the ability to pass a driving test given
by examiners appointed for this purpose. Five examiners are attached to the head-office staiT
and 223 other examiners are located throughout the Province, each restricted to the examination
of persons residing in the immediate vicinity. This is an important part of the work of the Branch
and unquestionably has done much to add to the safety of our highways not only by eliminating
the unfit but also by providing a means of control through the issuance of licenses. Continued
efforts to improve the standards of examination have been made over the years and it is recom-
mended that these efTorts be extended in the interests of safe driving.
Since the purpose of the driving examination is to ascertain whether the applicant for a license
is capable of driving and does not indicate to what extent the individual will apply his knowledge
when on the road, the Motor Vehicles Branch maintains a record or driving history of each
motorist. If a driver is involved in a reportable accident, or convicted or warned following an
offence relating to the operation of his motor vehicle an entry is made on his driving record. As
additions are made, these records are reviewed and appropriate action taken.
Accident repeaters, that is persons involved in two or more accidents, are given particular
attention and such persons are required to submit to driving and vision tests or their driving
privileges are recalled, depending on the nature and extent of the record. From the use of these
record files it has been possible to isolate many cases involving drivers lacking the physical
condition, skill or attitude necessary for safe driving.
Some comprehension of the volume of the work of the Branch will be secured when it is known
that these records cover the driving history of 750,000 motorists. This total may be compared
with the 1945 registration of 662,719 vehicles and 971,852 drivers.
As a means of avoiding wide variations in traffic regulations in the various parts of the Prov-
ince, which could only lead to confusion and increased difficulty in driving, the by-laws of all
municipalities are subject to approval by this Department before becoming operative. This work
is handled through the Motor Vehicles Branch and the number of by-laws submitted for ap-
proval has been increasing each year.
The work of the Public Vehicle Division involves the licensing and control of bus and public
transport vehicles. The activities of this Division have been considerably expanded since, with
the removal of restrictions by the Federal Government, the schedule of operations of most Public
Vehicle licensees has been altered by increases in the number of scheduled trips and in the number
of vehicles operated. The availability of new motor vehicle transport equipment has added to the
routine work of this Division since changes or additions in equipment necessitate changes and
additions in office records. There has also been a larger than usual number of enquiries and appli-
cations relating to bus and truck operations from men who have gained driving experience while
in the Services and who are anxious to establish themselves in the motor transport industry.
In addition to the permanent records of drivers and of public vehicle and public commercial
vehicle operating licenses, the Branch maintains one of the largest annual files in the public
service. A total in excess of 1,500,000 applications for driving licenses and motor vehicle permits
are recorded annually and filed by name of driver or owner and by license or permit number.
These various activities of the Branch are carried out by a head office staff of 95, with the
assistance of a temporary staff of 40 clerks necessary during the rush period.
To these members of the staff and to the representatives of the Branch throughout the Prov-
ince, I wish to express my thanks for their valuable aid and co-operation throughout the past
year.
Respectfully submitted,
J. P. BiCKELL,
Registrar of Motor Vehicles.
MOTOR VEHICLES BRANCH, 1945 79
NUMBER OF PERMITS AND LICENSES ISSUED
The number of drivers licensed and motor vehicles registered during each of the five years,
1941 to 1945, and the percentage change between the 1945 and 1944 totals are shown in the
following tables:
Yo
Class of License or Permit 1941 1942 1943 1944 1945 Change
Passenger car 636,624 611,897 586,036 568,223 555,461 2.2 D
Commercial vehicle 93,754 94,318 96,103 97,869 98,339 4.8 I
Bus 1,268 1,518 1,614 1,743 1,895 8.7 I
Two-purpose vehicle 1,654 1,543 1,447 1,321 1,279 3.2 D
Motorcycle 5,894 6,104 6,415 5,901 5,745 2.6 D
Total 739,194 715,380 691,615 675,057 662,719 1 .8 D
Trailer 48,739 48,795 48,426 48,900 53,004 8.4 I
Operators 690,582 664,455 f)30,680 615,293 637,020 3 . 5 I
Chauffeurs 296,191 297,428 288,867 290,357 334,832 15.3 I
Total 986,773 961,883 919,547 905,650 971,852 7.3 I
Instruction permits 122,002 76,390 70,112 69,974 81,928 17. 1 I
Transfers 179,930 125,964 133,032 115,952 102,410 11.7 D
•In transit' permits 14,511 3,341 .581 1,010 2,998 196.8 I
'M' dealers 1,076 794 569 709 708 0. 1 D
•MC dealers 3 2 2 3 4
REVENUE OF MOTOR VEHICLES BRANCH
Fiscal Year 1944-1945
Permits and Licenses:
Passenger % 4,162,069.05*
Commercial 3,451,476.90*
Two-purpose 6,275.60*
Trailers 351,844.94*
Motorcycles 5,302,60*
Dealers:
Automobiles $17,018.00
Motorcycles 18.00
17,036.00*
Operators' and Instruction permits 668,130.10*
Chauffeurs' licenses 397,192.90*
Public Vehicles 262,954.76*
Public Commercial Vehicles 270,104.20
Miscellaneous 863.62*
% 9,.593,250.67*
Fees:
In Transit" permits 2,111.15*
Duplicate cards 11 .784.00*
Transfers 97,616.90
Searches and certificates 1,423.33*
Lists 2,765.41*
E.xaminations 14,947.00*
Fines:
Breach of Highway Traffic Act 50,686.46*
130,647.79
% 9,774,.584.92*
* Indicates increase from previous fiscal year.
80
REPORT OF
No. 32
NUMBER OF MOTOR VEHICLES REGISTERED IN ONTARIO!
Year
1903.
1904
1905
1906,
1907
1908
1909
1910
191]
1912
1913
1914
1915
1916
1917
1918
1919
1920
1921
1922
1923
1924
1925
1926
1927
1928
1929
1930
1931
1932
1933
1934
1935
1936
1937
1938
1939
1940
1941
1942
1943
1944
1945
Passenger Commercial
178
535
553
1,176
1,530
1,754
2,452
4,230
11,339
16,268
23,700
31,724
42,346
51,589
78,861
101,599
127,860
155,861
181,978
210,333
245,815
271,341
303,736
343,992
386,903
429,426
473,222
490.906
489,713
462.923
453,314
470,617
489,610
514,211
541,802
580,364
593,693
610,576
636,624
611,897
586,036
568,223
555,461
Two
Purpose
2,786
4,929
7,529
1 1 ,428
16,204
19,554
24,164
28,612
31,488
34,690
39,012
43,442
54,714
55,218
61,690
64,256
61,347
59,760
64,436
67,590
70,693
75,687
81,642
82,206
86,038
95,022
95.836
97.717
99,612
100,234
8,226
5,986
4,177
3,239
2,909
2,724
2,370
1,847
1,876
1,893
1,855
1,654
1,543
1,447
1,321
1,279
Motorcycle
1,754
2,900
3,633
4,174
4,287
5,180
5,002
5,516
5,496
4,989
4,799
4,325
3,941
3,748
3,345
3,159
3,197
3,541
3,924
4,070
4,088
4,370
4,468
4,506
4,553
4,582
5,206
5,099
5,403
5,894
6,104
6,415
5,901
5,745
Total
178
535
553
1,176
1,530
1,754
2,452
4,230
11,339
18,022
26,600
35,357
46,520
58,662
88,970
114.130
144,804
177,561
206,521
239,296
278,752
306,770
342,174
386,349
433.504
487,337
540.207
562.506
562,216
531,597
520,353
542,245
564,076
589,457
623,918
669,088
682,891
703,872
739.194
715.380
691,615
675,057
662,719
t Totals do not include trailer permits.
* Included with passenger vehicles.
MOTOR VEHICLES BRANCH, 1945 81
REPORT OF ACCIDENT RECORDING DIVISION, 1945
As the name implies, the chief function of the Accident Recording Division is the collection,
compilation and analysis of statistics relating to motor vehicle accidents as a means of providing
information that will be of use in dealing with this problem in an intelligent and effective way.
At the end of 194o, the Division had completed fifteen full years of operation during which
period reports of 184,123 accidents had been received involving the loss of 8,881 lives, injury
to 154,095 persons and a property damage loss of $24,491,255. The reports of these accidents
were filed by approximately 2<)7,()()() drivers and the accumulated data have been used hi highway
and traffic engineering, in educating drivers and the public generally, in law enforcement, and in
the directing of preventive legislation. While, in view of the frequently unreliable source of the
information, accident statistics fall short of perfection — particularly those relating to the
primary causes of accidents — it is nevertheless certain that proper, intelligent use of the data
now available by highway and traffic engineers, by the police and educationists would result in a
large reduction in accident frequency and, at the same time, greater efficiency in traffic movement.
In 1945, largely due to the rapid increase in vehicle travel which followed the lifting of the
restrictions on motor vehicle use, there was an increase in accidents, deaths and injuries. There
were 13,458 mishaps reported during the year, in which 598 persons were killed, 9,804 persons
injured and a property damage loss of $2,249,271. These figures may be compared with the
corresponding totals for 1944 when 498 persons were fatally injured and 8,373 non4atally injured
in 11,004 accidents reported during that year.
(Since the circumstances of the accidents reported in 1945 are shown in some detail in the
statistical sunnnary appended to this report, and as a separate study has been prepared no further
comment relating to the statistics will be made here.)
An increasing amount of the work of this Division has been devoted in recent years to the
records of individual drivers and to the re-examination of drivers who because of age or inexperi-
ence or unfavourable records have caused some question of their driving fitness to arise. While the
number of drivers who have been unable to meet the requirements in such cases has not been
large, the fact that any such have been isolated and removed from the road would seem to justify
the continuance of this branch of our work, especially since its purpose is educational and not
intended as punishment for faulty behaviour.
In 1942 an arrangement was made with the Department of National Defence to have all cases
of epilepsy, coming to the attention of medical officers, reported to the Motor \'ehicles Branch.
The hazard resulting from the sudden loss of consciousness which is symptomatic of this condition
makes epilepsy a vital problem to licensing authorities. It has been our practice to prohibit the
operation of motor vehicles by such persons until satisfactory evidence of their fitness to drive has
been established.
The question as to what constitutes satisfactory evidence has presented a problem in the past,
and led, in 1945, to the establishment of the Drivers' Medical Appeal Board. This Board, which
comprises four experienced specialists in neurology, and a representative of the Branch, recom-
mends the action to be taken and its deliberations have undoubtedly resulted in fairer treatment
of the individual applicant and, at the same time, there has been shown a proper recognition of
the requirements of public safety.
REPORT OF PUBLIC VEHICLE DIVISION, 1944-1945
The administration of provisions of the Commercial Vehicle Act, the Public Commercial
Vehicle Regulations, the Public Vehicle Act and the Regulations passed thereunder is the assign-
ment of this Division of the Branch.
There are now licensed in Ontario a total of 3,657 Public Commercial Vehicle Operators, 17tt
Public Vehicle Operators and 461 School Bus Operators.
The vehicles operated are divided among the various classes of operators as follows;
P. C. V. Operator
251 Class A Operators 3,290 Vehicles
53
1,513
547
834
1,928
359
176 Public \'ehicle Operators 1,750 Vehicles
461 School Bus Operators 491 Vehicles.
38 •
' B
714 •
• C
213 '
' D
656 •
• E
1,650 •
• F
135 •
• H
82 REPORT OF No. 32
The termination of the war and the return to civiHan hfe of many men from the Services
has resulted in an increase in applications for licenses to operate Highway Transport vehicles
both buses and trucks. These together with an increasing number of applications for extensions
to existing licenses has necessitated the Ontario Municipal Board setting aside as many as four
days some months for the public hearings.
The Dominion Government regulations which have, since September, 1942, permitted the
transportation of Freight in Bond by highway vehicles were rescinded as of December 31st, 1945.
During the period within which these regulations permitted American trucks to operate
through Canada with Bonded Freight, a total of 33.848 vehicle trips were made between the
States of New York and Michigan through Ontario.
REPORT OF THE FINANCIAL RESPONSIBILITY DIVISION, 1945
This division of the Motor Vehicles Branch is so named because its chief responsibility is
the administration of the provisions of the Highway Traffic Act relating to the Financial Re-
sponsibility of motor vehicle drivers and owners. These provisions are contained in Part XIII
of the Act and have now been in effect for more than fifteen years, having been enacted in
September, 1930.
This part of the Act is commonly referred to as The Financial Responsibility Law in that
it requires the filing of proof of financial responsibility by those motor vehicle drivers and owners
who by reason of act or omission bring themselves within its provisions. It might almost be
referred to as a quasi-compulsory insurance law and in fact it was enacted in preference to a full
compulsory insurance law for motorists. It requires the filing of Proof of Financial Responsibility
(usually in the form of an insurance policy certificate) by those convicted of the offences named
in the Act and those who fail to satisfy judgments secured against them for damages arising out
of motor vehicle accidents.
No serious administrative difficulties have been encountered in the enforcement of the
financial responsibility provisions of the Act and it would appear that it has to a degree fulfilled
its purposes, namely; (1) to penalize those convicted of serious offences with motor vehicles by
requiring them to file a certificate of insurance or other proof of financial responsibility or to be
barred from the roads; (2) to assure the payment of judgments secured for damages arising out
of motor vehicle accidents; and (3j to increase the number of insured vehicles.
Tables appended hereto show details by years of cases dealt with during the fifteen year
period, 1930 to 194.5, inclusive.
Table I shows the number of suspensions applied as the result of the registration of con-
victions for the various offences named. A conviction for speeding, careless driving or operating
without a driver's license requires the filing of proof of financial responsibility only where the
offence resulted in personal injury or property damage. A conviction for any of the other named
offences requires the filing of such proof regardless of whether there was injury or damage. Where
a suspension is applied for failure to satisfy a judgment, in addition to filing proof of financial
responsibility, the judgment must be discharged or arrangements made for settlement in instal-
ments before the driving privileges of the judgment debtor may be re-instated. The cases listed
under the heading "Cancellation of Proof of F. R." refer to those where a suspension applied
following conviction for one of the offences named was rescinded upon the filing of an insurance
certificate or other proof but where such certificate or other proof was later withdrawn. A period
of two years not having elapsed since the conviction was registered, suspension was again neces-
sary.
In order to clarify that part of the table wherein it is shown that there have been many
more su.spensions issued for reckless and dangerous driving than for careless driving it should
be stated that the careless driving provision in the Highway Traffic Act was first enacted in 1939
and replaced the former reckless driving provision which was at that time nullified by Dominion
legislation covering the same offence under the Criminal Code.
Table II shows, by years, the number of suspensions which have been rescinded. Opposite each
offence is shown the number which were rescinded as a result of the filing of proof of financial
responsibility. The number shown opposite "expired" has reference to those cases where proof
of financial responsibility was not filed but where this requirement was waived after the expira-
tion of the two-year period.
As the suspensions rescinded in any one year may not have been applied in the same year
it is not possible from the appended tables to determine the number for any one year where
proof of financial responsibility was filed. It is, however, interesting to note from the total column
MOTOR VEHICLE BRANCH, 1945 83
that the more serious the offence the lesser the number which were rescinded upon the fiHng of
insurance certificates or other ]:)roof. For example, of those suspended for the offence of speeding
almost 70 per cent, were rescinded upon the filing of proof as contrasted with 30 per cent, for
the offense of drunk driving. Of the 69,112 suspensions applied, 32,148 (less than half) have
been rescinded upon the filing of proof of financial responsibility. All persons affected Ijy the
remainder of the suspensions have been or will be barred from the roads for a period of at least
two years. In this connection it should be stated that the waiving of the requirement of filing
proof of financial responsibility is discretionary with the Minister after two years and, therefore,
the length of time for which any person who brings himself within the provisions of the law is
required to file such proof depends upon his operating record. In some cases it is required to
be maintained on file indefinitely.
From 1930 to 1941 there was a gradual increase in the number of suspensions applied until
the total for 1941 was in excess of 7,000. From 1941 there was a gradual decrease to the present
figure for 1945 of 4,191. It is quite apparent that this decrease was due to the decrease in the
annual aggregate mileage motor vehicles were operated during the war years. With the lifting
of gasoline rationing and other restrictions it is anticipated that there will be a decided increase
in the number of suspensions which will be ajiplied during the year 1946.
84
REPORT OF
No. 32
TABLE
FINANCIAL RESPONSIBILITY
September 1, 1930, to
Offence
vSpeeding .
Racing. .
Operating Without
Driver's License.
Careless I )riving .
Reckless and Dangerous
Driving
Leaving Scene of an
Accident
Drunk Driving
Criminal Negligence
Other Offences
Judgments
Cancellation of Proof
of F. R
Total .
339
1007
1930*
1931
1932
1933
6
19
15
37
4
3
1
1
323
1 1 99
92()
i3n()t
1934
44
147
983
585
1064
1322
212
469
976
690
3317
2544
4106
2:)61
1935
64
231
1546
822
3547
1936
84
2
212
92
186
72
182
175
155
232
186
554
324
345
420
532
522
9
34
29
36
32
25
26
41
79
57
69
88
99
95
48
66
90
46
73
82
894
3860
* Four months only (Sept. 1 .iO. to Dec. 31 30).
t H. T. A. amended in 1934 so that suspensions re'iuired only where this offence resulted in injury or damage,
tt Sec. 27 H. T. A. (Careless Driving) became effective July 1 39. Suspensions applied for this offence, 1012 for
1939 and 2494 for 1940, included under the classification "Reckless Driving."
MOTOR VEHICLE BRANCH, 1945
So
No. I
SUSPENSIONS APPLIED, BY YEARS
December 31, 1945
1937
1938
1939
1940
1941
1942
1943
1944
1945
Total
77
76
34
21
23
15
10
IS
7
5.50
5
247
2
264
182
2
150
5
156
2
170
27
271
166
178
612S
tt
2560 tt
ft
3203ft
3049
743
2445
660
1638
474
1674
450
1776
438
1 0582
2191
2533
20802
264
361
317
371
493
350
307
280
312
4N9
826
1089
881
1013
1073
874
674
608
701
10<i22
54
29
14
3
3
2
1
1
298
98
150
178
125
153
222
218
201
1.53
202(i
111
106
150
158
137
108
89
73
73
1410
1015
1050
911
1022
1066
1202
980
644
558
12518
4907
5646
521 i
6094
7006
6058
4544
4110
4191
69112
86
REPORT OF
No. 32
TABLE
FINANCIAL RESPONSIBILITY
September 1, 1930,
Offence
1930*
1931
1932
1933
1934
1935
1936
Speeding
3
10
14
29
36
42
55
3
4
2
2
Operating Without
Driver's License
38
336
413
509
2531
99
95
Careless Driving
Reckless and Dangerous
Driving
S3
571
554
659
823
950
988
Leaving Scene of
an Accident
18
107
101
125
107
103
116
Drunk Driving
10
195
184
149
186
183
165
Criminal Negligence
3
12
15
13
14
18
7
Other Oflfences
3
16
16
19
21
35
27
Judgments
2
14
26
22
20
35
Cancellation of Proof
of F. R
3
100
405
518
523
496
447
Expired***
1
108
365
480
Total
161
1352
1720
2050
4371
2311
2417
* Four months only (Sept I 30. to Dec. 31 30).
** Sec. 27 H. T. A. (Careless Driving) became effective July 1 39 Rescinded suspensions applied under this
section included under the classification "Reckless Driving" for 1939 and 19t()
*** Suspensions rescinded without proof of Financial Responsibility being filed but where this requirement was
waived because period had expired.
MOTOR VEHICLES BRANCH, 1945
87
No. II
SUSPENSIONS RESCINDED, BY YEARS
to December 31, 1945
1937
1938
1939
1940
1941
1942
1943
1944
1945
Total
63
51
31
11
12
9
4
9
3
382
1
52
2
40
48
2
52
1
35
3
34
20
84
38
32
4436
**
**
1240
1294
920
967
925
5346
1124
1184
1345
1641
638
242
192
147
135
11276
138
141
165
164
195
137
132
124
128
2001
187
193
219
260
252
205
182
172
164
2906
19
14
9
3
3
1
1
132
20
10
22
5
12
13
7
23
14
263
30
36
54
51
65
31
27
22
20
455
409
371
401
323
267
205
202
129
132
4931
485
649
739
805
1246
1108
1206
1988
1829
11009
2559
2702
3027
3311
3984
3282
2905
3617
3388
43157
DURING YEAR, 19'*5.
NUMBER OF ACCIDENTS
FkIaJ I ''•••"•^
ProcMrtjr
^00
P'^5g
7^ 1101
IS 253
5'^?! lOti 5g26
993
33 C
NUMBER OF ACCIDENTS
.5^55
2761 4-o5-2'
17 Si+S
252 2791
'^ar
31
r 10
pit
4612
kiitd pwtad vduck
FICATION
ICTIMS
22
50
6
125
59«
23C
n
12
£29Q
26M
"19^
m mi
9«0l^
14.
NATURE OF INJURIES
FMtf NiB-
1. Fractured •kull
2. Fractured apine
3 Other (ractum
ConciiMinn ai brain
f. Seven fcneral ibock •rith bruiew and cult
6 Si(h( ahock wtd thake up
Inlenul injuria
8 Other injuria* (•praina. dialacationa. wrcnehea, *(r.)
0 Cul« Ijy |Um (only)
Drowaed
Buraad
Aaphjrxiated.
3 Not Mated
531 196
ii-5 20
26 1^4-3*
2'^ 300
973.
153 i 173
! 521
595.
1
10 .2.
TYW
Ewtk
Gravel or crailMd Moae.
Pa»a< hu4 mittmBt
nmPACS
Dry«
Wet I
Maddyi
Sattary ntiao*
Icy mrlaoe
Not lUted
cxwomoN
la good OQsditio*,
[Mea ■• raadvay
4- Obauactioa ael Hfktad.
101
1069
\22tt
L3^5^
7993
2571
£2
1396
1476
L3'f5a
.13
IQ
l'h^5t
6551 5271
70«5 5826
^:>^9 3P59
132|» 1153
1^ 6
571* m.
7069 5626
706^ 5626
,i. P. BICKELU
^:^'
PROVINCE Of ONTARIO
MOTOR VEHICLES BRANCH
SUMMARY OF MOTOR VEHICLE ACCIDENT STATISTICS
DURING ireAH. i?"*?.
ANNUAL REPORT
OF
THE COMMISSIONER
OF THE
ONTARIO PROVINCIAL POLICE
FROM
JANUARY 1st, 1946 TO DECEMBER 31st, 1946
PRINTED BY ORDER OF
THE LEGISLATIVE ASSEMBLY OF ONTARIO
SESSIONAL PAPER No. 34, 1947
ONTARIO
TORONTO
Printed and Published by
Baptist Johnston, Printer to the King's Most Excellent Majesty
1 947
'The Honourable Ray Lawsoti, O.B.E.,
Lieute/uifit-Goverfior of the Province of Ontario.
MAY IT PLEASE YOUR HONOUR:
The Undersigned has the honour to present to Your Honour the Report of
the Commissioner of the Ontario Provincial PoHce covering the period January
1st, 1946, to December 31st, 1946.
Respectfully submitted,
L. E. BLACKWELL,
A ttorney-General.
Attorney-General's Department.
(3)
ONTARIO PROVINCIAL POLICE
Commissioner
W. H. STRINGER, O.B.E.
Deputy Commissioner
W. C. KILLING
Criminal Investigation Branch
A. H. WARD, CHIEF INSPECTOR
E. C. GURNETT, M.M.
W. J. FRANKS
W. H. KENNEDY
A. MACLEOD
Inspectors
G. MacKAY
W. H. LOUGHEED
F. C. KELLY
T. R. WRIGHT
C. W. WOOD
W. H. CLARK
PROVINCIAL CONSTABLE G. LONG (Photographer)
A. MOSS
Staff Inspectors
E. T. DOYLE
F. B. CREASY
No.
1
No.
2
No.
3
No.
4
No.
5
No.
6
No.
7
No.
8
No.
9
No.
10
No.
11
No.
12
No.
13
Liquor Control Investigation Branch
P. WALTER, Staff Inspector
J. BARTLETT, Sergeant
A. M. SHAUGHNESSY, Sergeant
Firearms Registration Branch
W. H. BOYD, Registrar
District Inspectors
1 District, Windsor District Inspector W. A. SCOTT
C. A. JORDAN
London
Hamilton
Niagara Falls.
Aurora
Kitchener
Barrie
Belleville
Perth
Haileybury
Sudbury
Port Arthur....
Kenora
A. R. KNIGHT
C. F. AIREY, M.S.M.
E. HAND
W. A. PAGE
R. COX
H. E. THOMPSON
T. W. COUSANS
S. OLIVER
T. WILKINSON
P. T. HAKE
H. STOREY
(5)
Provincial Constable Thomas A.
Suggett, Kingston Detachment, Num-
ber 8 District, Belleville, who was ap-
pointed January 1st, 1941, was drowned
when he tripped and fell from the dock
at Queen's University in the early
morning of July 13th, 1946.
(6)
Report of the Commissioner of Police For Ontario
From January 1st, 1946, to December 31st, 1946
ONTARIO PROVINCIAL POLICE,
Headquarters, Toronto.
THE HONOURABLE THE ATTORNEY-GENERAL,
Parliament Buildings, Toronto, Ontario.
SIR:
I have the honour to submit herewith my Annual Report covering the
work of the Ontario Provincial Police, together with statistical data for the
period January 1st, 1946, to December 31st, 1946.
The Police Act, 1946
The enactment of The Police Act, 1946, passed by the Second Session of
the Twenty-Second Legislature of Ontario, begun and holden at Toronto on
the 4th March, 1946, has caused considerable interest amongst Municipal
Councils and Police Departments in the Province of Ontario. This particular
Act leaves no doubt as to the division of responsibility in connection with
administration of the law between municipalities and the Ontario Provincial
Police. This Force operated originally only in aid of local Forces at the re-
quest of the County Crown Attorney; or by direction of the Attorney-General.
The Provincial Government, while holding local authorities primarily
responsible for law enforcement, found as time went on that in the various
counties there was for the most part inefficient or insufficient exercise of
police powers.
It, therefore, expanded this Force, and so stationed it that it commenced
for the first time in its career to perform certain local policing functions in
Southern (Jntario.
The local authorities appear to have been so satisfied with this system
that for the most part they have sought more and more Provincial service ;
although they have never lost their right to have their own Police if thev
so desired.
The Police Act, Sections 2 and 3, clearly define the division of responsi-
bility and, in accordance with the provisions of the specified sections, a number
of townships, or a portion thereof, villages, and special enterprises have been
designated as responsible for law enforcemnt in their particular municipality
or area. A list of such designated areas will be found on pages 16 to 31, in-
clusive, in the regulations made under this Act.
Prior to the introduction and enactment of this Act the responsibilities
insofar as the Ontario Provincial Police were concerned were never clearlv
defined under the Constables Act. Consequently, it may well be understood,
there were times when it was extremely difficult to establish a policy with
respect to policing responsibilities. The application of the provisions of The
Police Act should prevent and eliminate anv future confusion alone similar
hnes.
Another point which will prove interesting is the fact that under this
legislation the regulations dealing with discipline, qualifications for appoint-
ment, etc. insofar as it affects police personnel throughout the Province have
(7)
8
REPORT OF THE COMMISSIONER OF THE
No. 34
been made uniform or standard. This will, no doubt, ultimately prove bene-
ficial to l)oth the personnel employed in law enforcement work and those to
whom they are responsible.
Policing of JMuiiicipnliiies
Up to the end of the }'ear 1946, contracts have been entered into between
the municipalities concerned and the Commissioner of Police for Ontario,
under the provisions of the Municipal Act. R.S.O. 1937, Chapter 266, Section
383a. as enacted by 8 George VI, Chapter 39, Section 35, whereby the following
mvniicipalities are now being policed by members of the Ontario Provincial
Police Force :
Effective
MUNICIPALITY Date
Ajax, Ontario County .. 1 June 1946
Alexandria, Glengarry County . 15 Sept. 1945
Amherstburg, Essex County 1 Sept. 1946
Arnprior, Renfrew County ; 15 Oct. 1945
Atikokan Improvement District, Kenora District ... 1 Oct. 1946
Barrie, Simcoe County 1 July 1946
Bayham Township, Elgin County 1 June 1946
Beamsville, Lincoln Countj^ 1 May 1946
Brantford Township, Brant County 1 Nov. 1945
Cobalt. Timiskaming District 1 Aug. 1946
Cochrane. Cochrane District 1 July 1946
Colchester South Township, Essex County 4 Dec. 1946
Eganville, Renfrew County 1 Oct. 1945
Espanola Townsite, Sudbury District . 1 June 1945
Hearst, Cochrane District .. 1 May 1946
Mersea Township, Essex County 22 Nov. 1946
Mount Forest, Wellington Count}' 1 May 1946
McKim Township, Sudbury District 1 June 1945
Neelon and Garson Township, Sudbury District... 1 Feb. 1946
Nipigon Township, Thunder Bay District 9 July 1946
Port Dalhcusie, Lincoln Countj' 16 Nov. 1946
Rockcliffe Park, Carleton County 1 June 1945
Schreiber Township, Thunder Bay District 1 Mar. 1946
Sioux Lookout, Kenora District 1 July 1946
Terrace Bay Townsite, Thunder Bay District 6 Nov. 1946
LTxbridge, Ontario County 1 Nov. 1946
Vankleek Hill, Prescott County 1 April 1946
Wasaga Beach Improvement District,
Simcoe County 1 May 1946
Number of
Personnel
2
2
2
3
1
11
1
1
1
2
3
1
1
1
2
1
2
2
2
1
1
2
1
2
1
1
1
1 plus 4
part time.
In each case, the municipality pays the sum of $1,750.00 per annum for
the services of each member irrespective of rank. If an automobile is required,
the upkeep of such vehicle is paid for by the municipality at the rate of .06c
per mile in Southern Ontario and .07c per mile in Northern Ontario.
This system has proven very satisfactory both from the standpoint of the
municipality concerned and this Force. The personnel employed on such
municipal police duties are under the supervision and control of General
Headquarters. It has been foitnd that a more uniform basis of law enforce-
ment results, than if such municipalities employed and selected their own
personnel.
With the proclamation of The Police Act, 1946, this particular policing
policy will continue throughout the Province with more satisfactory results
in view of the fact that such Act defines, without doubt, the division of
responsibility heretofore not clarified.
1946 ONTARIO PROVINCIAL POLICE 9
Radio Comniunlcatioii
During- the Second Session of the Twenty-Second Legislature of Ontario,
which commenced on the 4th March, 1946, the sum of $500,000.00 was voted
for installation of a modern Frequency-Modulated radio communication
system for the Ontario Provincial Police.
The services of Professor J. E. Reid, who is a registered professional
engineer and a consultant in electronics and communications were retained
by the Department of the Attorney-General of Ontario to conduct a survey
and ad\-ise \\\t\\ respect to the installation of a radio communication S3^stem to
adequately fulfill the requirements of this Force in Southern Ontario.
On August 12th, 1946, specifications for frequency modulated radio com-
munication equipment for the proposed system were prepared and submitted
to the following companies who desired to submit tenders for the consideration
of the (TO\ernmcnt :
Northern l^lectric Company R.C.A. N'ictor Company Limited
Canadian (lencral l\lectric Company Rogers Majestic Limited
Canadian Marconi Comj)any Bell Telephone Company
In the intervening period between the submission of the tenders by the
abo\e companies and the final acceptance of the successful tender by the
Government, extensive experimental and test work was carried on in an effort
to determine the merits and qualities of the equipment offered by the com-
peting companies.
On November 23rd, 1946, tenders submitted by the aforementioned com-
panies were opened by Commissioner William H. Stringer in the presence
of Mr. C. R. Magone, K.C., Department of the Attorney-General, and Pro-
fessor J. E. Reid, Radio Consultant. The tenders were then forwarded to The
Honourable The Attorney-General. Under an Order-in-Council dated the 30th
of January, 1947, the committee of Council authorized The Honourable The
Attorney-General to enter into an agreenient with the Canadian General
Electric Company Limited for the supply, installation and maintenance of a
Fref|uency-Modulated Radio Communication system for the Ontario Pro-
vincial Police.
The Ontario Provincial Police radio system \\\\\ cover most of southern
( )ntario and later those parts of northern Ontario that are nearest centres of
])opulation. It has been deemed impractical to cover at the present time
sections in southern Ontario that are sparsely populated, additional radio
facilities to cover these areas can be provided later if found necessary.
The southern part of the Province is divided into nine districts with a
district headquarters in each District ; the general headquarters is in Toronto.
In each District there are several detachments, some of these at present are
operating from private residences, some have offices. Each District operates
automobiles for highway patrol and other police duties.
The individual District allocation is indicated hereunder:
District No. 1 (Essex atid Kent Counties)
A 250 watt station will be established at District Headquarters located
at Chatham. A 60 watt station will be placed at Windsor.
10 REPORT OF THE COMMISSIONER OF THE Xo. 34
Dtstric: No. 2 (Elffin, Lamhton, Middlesex and Oxford Coiuittes)
A 250 watt station will be established at District Headquarters located
at London. 60 Watt stations will be located at Sarnia. St. Thomas and
Woodstock.
District No. 3 (Brant, Hal ton, Norfolk and JVentworth Counties)
A 250 watt station will be established at District Headquarters located
at Dundas. 60 watt stations will be located at Simcoe and Brantford.
District No. 4 ( Haldiinand, Lincoln and Helland Counties)
A 250 watt station will be established at District Headquarters located
at Niagara Falls. 60 watt stations will be located at Cayuga, Welland and
St. Catharines.
District No. 5 and General Headquarters (Ontario . Peel and York Counties)
A 250 watt station will be established near Aurora and will serve both
General Headquarters, Toronto, and Number 5 District Headquarters, Aurora.
60 watt stations will be located at Whitby and Brampton.
District No. 6 {Bruce, Grey, Huron, Perth, JVaterloo and Jfellinc/ton Counties)
A 250 watt station will be established at District Headquarters located
at Mount Forest. 60 watt stations will be located at Owen Sound. Walkerton,
Kitchener, Goderich, Guelph and Stratford.
District No. 7 (Dufferin, Simcoe, Muskoka and Parry Sound Counties)
A 250 watt station will be established at District Headquarters located
at Barrie. 60 watt stations will be established at Parry Sound, Burks Falls
and Bracebridge.
District No. 8 (Frontenac, Haliburton , Hastings, Lennox and Addington, North-
umberland and LJurham, Peterborouf/h, Prince Ed'^vard and J ictoria Counties)
A 250 watt station will be established at District Headquarters located
at Belleville. This District is large, with some very sparsely populated reg-
ions. In addition to the District Headquarters a main 250 watt station will be
established at Peterborough. 60 watt stations will be established at Kingston,
Cobourg, Lindsay, Napanee and Picton.
District No. 9 ( Carleion , Dundas, Glengarry , Grenville, Leeds, Lanark, Prescott,
Renfrew, Russell and Siormont Counties)
A 250 watt station will be established at District Headquarters located
at Perth. This District is also very large and of peculiar geographical shape.
In addition to District Headquarters, a main 250 watt station will be estab-
lished near Cornwall or Casselman and 60 watt stations at Arnprior, Brock-
ville, Ottawa and Pembroke.
It will be noted that the communication as briefly outlined provides for
main stations (250 watts) at each District Headquarters as indicated; also
one at Peterborough in No. 8 District ; and one at either Cornwall or Cassel-
man in No. 9 District ; making a total of eleven 250 Avatt stations. There will
1946 ONTARIO PRCJVINCIAL POLICE 11
he thirty 60 watt fixed stations at the detachments specified. This proposed
s}'stem will permit complete radio coverage over the area in the nine Districts
and provide adequate control over approximately 281 mobile units owned
and operated by the Force.
A survey throughout the area to be covered by the radio communication
system with respect to the selection of sites for the fixed stations is practically
completed and the allocation of frequencies for use in connection with the
system is at present awaiting decision of the Federal authorities.
It is expected that installation will begin immediately following this
authorization. The ultimate realization of actual operation in all nine districts
is expected towards the latter part of the summer.
A fairly high standard of efficiency has been maintained in the past with
the ordinary communication facilities, although it was known that the Pro-
vincial Police covild not at an}- time effectively blanket any area when an
outbreak of crime such as a bank robbery was reported. Criminals in pos-
session of fast transportation, operating on good highways could be many
miles away before the police received word of the commission of the crime.
The lack of radio communication between District Headquarters and
mobile units was undoul)tedly a serious handicap in law enforcement.
All previous communication difficulties will be removed after the instal-
lation of the latest type of Frequency Modulated radio which embraces all the
developments created during the last war. Supervision of moving- patrols
will be greatly facilitated, since radio permits frequent checks on location and
activities. These two factors alone are strong arguments for the use of radio
telephone.
Transfer of General Headquarters , Toronto
Owing to the lack of office accommodation in the Parliament Buildings
it was found necessary to vacate the offices occupied by General Headquarters
since 1927.
New quarters were established at L3 Queen's Park Crescent and on
October 15th, 1946, General Headquarters and all administrative branches
were transferred to our present location, 13 Queen's Park Crescent.
The present accommodation is convenient with the exception there are
no facilities for our stores \\-hich are still occupying space in the l)asement
and on the fifth floor of the Parliament P)uilding-s.
1 ransfer of No. 5 District Headquarters , Toronto to Aurora
On Octol:)er 16th, 1946, the offices of Number 5 District Headquarters
were transferred froni the Parliament Puuldings, Toronto, to the ^Municipal
]')Uilding-, Aurora.
This transfer became necessary due to the fact that the space occupied
in the Parliament Buildings was recjuired by other Departments, also on
account of the proposed installation of radio. Aurora, by reason of its Higher
altitude and central location was considered much more suitable than Toronto.
tormaiion of Nen District
A recomniendation has been submitted that Number 10 District with
District Headquarters presently located at Haile}-l)ury, l)e di\-ided and a new
12 REPORT OF THE COMMISSIONER OF THE No. 34
District formed.
At the present time, Number 10 District has a frontage of 560 miles from
the eastern boundary at Dieux Rivieres on the Ottawa River to the boundary
of Thunder Bay District, about 65 miles west of Hearst.
Due to the large territory in this District, the District Inspector finds it
practically impossible to maintain the constant supervision necessary in order
that efficiency be maintained in the many detachments established in the area.
If the recommendation is approved a new District Headquarters will be
established at Cochrane, with the necessary personnel and clerical staff. The
District would embrace the following posts and detachments :
Hearst Iroquois Falls
Hearst Municipality Timmins
Kapuskasing Matheson
Cochrane Smooth Rock Falls
Cochrane Municipality
The area of the new District will include the District of Cochrane, the
northern portion of Algoma, extending from an imaginary line running paral-
lel to the Canadian National Railway and twenty miles south thereof, and
include that portion of the Canadian National Railway in the District of
Thunder IJay up to and including Grant.
Prisoners of War
At the beginning of 1946, there were still approximately five thousand
German Prisoners of War under detention in this Province. Some were in
detention camps but the majority were engaged in industrial occupations such
as lumbering, farming, brickmaking, etc.
During the year, the prisoners were being returned to the United King-
dom and the detention camps reverted to other purposes.
At present the only camp still functioning is that at Neys, Ontario, where
a number of Japanese are quartered. ]\Iany prisoners have been permitted to
have their families with them, and are usefully employed.
Industrial Unrest
During the year, strikes were called which affected the Steamship, Elec-
trical. Rubber, Steel. Brass and Lumber industries of the Province.
Calls for assistance from this Force were made l)y the responsible authori-
ties of the municipalities concerned and assistance was pro\-ided in the follow-
ing instances :
On May 17, 1946 — a strike was called by the Mine,.AIill and Smelters'
Union, C.I.O. at the plant of the Anaconda American Brass Company Limited,
New Toronto, which affected fourteen hundred employees.
This strike, which was peaceful for a time, l^ecame menacing and resulted
in a call from the municipal authorities for assistance from this Force.
On June 27th, 1946, a detail of eighty officers and men was sent to assist
the local authorities. This strike dragged on until October, when a settle-
ment was arrived at and the personnel of this Force were returned to their
posts.
1946 ONTARIO PROVINCIAL POLICE 13
On May 25, 1946 — a strike was called by the Canadian Seamen's Union,
CIO. on vessels sailing the Great Lakes and one hundred and forty-five officers
and men were detailed for duty in the Welland Canal area, and sixty-five for
dut}- in the St. Lawrence River area at Cornwall and Prescott.
On July 14tlij 1946 — a strike was called b}' the United Steel Workers' of
America C.I.O. at all plants of the Steel Company of Canada. Two plants
concerned in Ontario were at Sault Ste. Marie and Hamilton. There was no
trouble at Sault Ste. Marie. All the strength of the imion was concentrated
at the Hamilton plant.
As the strike continued, violence between strikers and non-strikers was
much in evidence and mob rule existed at the plant entrance.
The local police were unable to maintain law and order and the Police
Commissioners of the City of Hamilton applied to the Attorne3'-General for
assistance. On August 26th. 1946, a force which consisted of two hundred
and twenty officers and men of this Force, with an equal number of members
of the R.C.M. Police were sent to Hamilton to assist the local authorities in
preserving order and preventing violence. The strike ended without anyone
being seriously injured or extensive property damage, although there were
spasmodic acts (jf violence which resulted in personal injuries and necessitated
a number of arrests.
Identification Pliot(u/ra/ihy and Finger P/inting
During the year the Criminal Investigation Branch has been supplied
with some of the most modern equipment available. As a result, we are now
in a position to turn out a very fine type of photography, which, in its par-
ticular class, can well be rated second to none.
New finger print equipment is also expected to prove its value as the
occasion arises, and it can well be said that in this respect, our equipment has
been brought to a state of practical efficiency.
Following is a list of some of the new equipment referred to above:
Omega D-11 Enlarger with accessories, including a copying' attachment
for photographing documents, small objects, etc.
Complete finger print equipment, including a post mortem kit for finger
printing deceased persons and finger tissue builder kit. used to restore finger
tips of deceased persons when the skin is partially decomposed, badly wrinkled,
etc.
Special lighting units, with appropriate filters for ultra-violet and infra-
red photography of documents, dyes. etc. These methods aid in detecting
alterations and erasures in writing, differences in colour, etc.
Moulage kit for preparing casts of foot prints, tire treads, weapons, death
masks, finger prints in dust, etc.
Equipment for making photomicrographs in black and white or in colour.
A new 4x5 Speed Graphic Camera.
Prosecutions
There was a total overall of 20.696 prosecutions entered for all offences
during the year, an increase of 4,491 over 1945.
Thev were distributed as follows :
14 REPORT OF THE COMMISSIONER OF THE No. 34
Under the Criminal Code and relating- Statutes, there were 7.053 prose-
cutions, an increase of 1.264 over 1945.
Under the Highway Traffic Act. there were 8.467 prosecutions, an in-
crease of 2,678 over 1945.
Under the Licjuor Control Act, there were 4,773 prosecutions, an increase
of 1,227 over 1945.
Under the Revised Statutes of Ontario there Avere 294 prosecutions, a
decrease of 50 over 1945.
Under the Revised Statutes of Canada, there were 59 prosecutions, a
decrease of 26 over 1945.
Under Wartime Regulations, there were 50 prosecutions, a decrease of
602 over 1945.
Totals : 1946 20.696
1945 16,605
Increase 4.491
The increase can he accounted for by reason of the number of prose-
cutions arising in municipalities now policed by members of this Force.
Crime
In the past few years, there has been a noticeable increase in the brutality
utilized in crime classified in the first instance as murder. Some of the acts
perpetrated create a serious doubt as to the mentality of the persons respons-
ible. This is frequently reflected in the outcome of cases presented to the
various Courts throughout the Province, where some of the accused persons
have been pronounced unfit to instruct counsel. There is every reason to
believe that some of the unsolved murders during the past few years, par-
ticularly some of the more brutal ones, have been perpetrated by persons with
serious mental defections. This theory is based, for the most part, on the
apparent lack of motive for the commission of the crime, combined Avith the
brutal method of its accomplishment.
CRIMINAL OCCURRENCES REPORTED AND INVESTIGATED
Murder
Manslaughter
Rape
Burglary
Shopbreaking
Housebreaking
Robbery with Violence
Robbery .',
Automobile Thefts
Other Thefts
1946
1945
24
23
29
22
31
27
104
119
724
727
1,058
1,123
67
69
75
62
425
552
3,095
3,174
TOTALS 5,630
Alurder
Investigations were conducted during the year into the alleged murders
of twenty-four persons, an increase of one over the year 1945.
Eighteen of the occurrences reported were in territory over which this
force exercises jurisdiction. In the six additional cases, members of this Force
1946 ONTARIO PROVINCIAL POLICE 15
were assisting Municipal Police Forces.
Tlie investigations into five cases continued from 1945 were also completed.
A summary of results of these investigations is as follows :
Convicted and sentenced to be hanged 6
Convicted of Manslaughter 5
Convicted of Occasioning Bodily Harm 1
Committed to Mental Hospital 2
Committed Suicide 2
Acquitted 2
Awaiting Trial 6
Still under Investigation.. 5
Bank Robberies
The follow^ing hank rohberies and attempted robberies were reported,
in\estigated. and with one exception were satisfactorily cleared up:
January 19th, 1946 — Bank of Nova Scotia, Marham, Ontario.
January 27th. 1946 — Imperial Bank, Bolton, Ontario,
February 11th, 1946 — -Imperial Bank, Fonthill, Ontario,
April 28th, 1946 — Royal Bank of Canada, Embrum, Ontario.
May 23rd, 1946 — Bank of Toronto, Carlisle, Ontario.
May 31st. 1946 — Bank of Commerce, Selkirk, Ontario,
June 13th, 1946 — Provincial Bank of Canada, Tecumseh, Ontario.
Continued from 1945 :
August 23rd, 1945— Bank of Montreal. Blenheim, Ontario,
September 26th, 1945 — Royal Bank of Canada, Leaside, Ontario.
Matters Pertaining to other Felice Departments
Investigations under The Constables Act
During the year, an Inspector of the Criminal Investigation Branch was
assigned under the provisions of The Constables Act to investigate and enquire
into and report upon the conduct and administration of the following police
departments :
City of Guelph,
City of Timmins,
Town of Waterloo.
At the conclusion of the encjuiry, reports were submitted to The Hon-
oural)le The Attorney-General.
Kight Mobile Patrols
It is regretted that the "Mobile Patrols" which had been so effective dur-
ing the year 1944 could not be maintained because of the many and continuous
calls on the Districts for extra personnel to perform special duties in connec-
tion with strikes, whereby the members of the Force doing both detachment
and highway patrol duties were absent from their Districts manv months
during the year.
It is hoped, particularly with the added responsibilities imposed on the
16 REPORT OF THE COMMISSIONER OF THE No. 34
Force under the Police x\ct. that the same conditions will not prevail in 1947,
and that personnel will be retained at their posts. It will then be possible
to put these effective patrols into operation again.
Highway Patrol Escorts
The Force provided many special escorts during the year including those
for crippled children to their camps, funerals, and injured persons to and from
air ports and hospitals.
Amongst the distinguished visitors to the Province for whom escorts
were provided were :
General Dwight Eisenhower,
The Earl of Athlone and Princess Alice,
Governor-General Viscount Alexander of Tunis and Lady Alexander,
Field Marshal \"iscount Montgomery,
Right Honourable Herbert Morrison, Lord Privy Seal,
His Excellency the Ambassador of France,
and other notal^le persons.
Iljghgrading
Members of the Force detailed for special duty under this heading have
been active in all mining areas in Ontario, and have been able, by request, to
materially assist the provinces of Quebec and Manitoba in their endeavours
to suppress the illegal trafficking in gold.
However, it is noteworthy that the following extract from a report sub-
mitted by the Sergeant in charge of the Highgrade personnel reports to the
contrary from the United States Customs officer at Detroit :
"I wish to draw your attention to the sharp decrease of prosecutions
and investigations handled during the year 1946, in comparison with former
years since the Highgrade Squad was formed. \ ery few complaints have
been received from the mining industries and from our sources of information,
it would appear that the sale of highgrade gold is practically at a standstill."
There has been the same excellent co-operation between the members of
the forces engaged in the work and the United States Treasury and Federal
officials, as in former years.
Registration of Fir ear nn-
In enforcing those sections of the Criminal Code dealing with the issuance
of permits and the registration of firearms, care has lieen taken that the strict
interpretation of the rights of individuals should not be interfered with.
The following permits were issued through the Firearms Registration
Branch during the year:
Vendors' Permits 8
Permits to Purchase 2,098
Permits to Carry 811
Aliens' Permits .^ 8,734
The large number of Aliens' Permits are accounted for by issuing permits
to United States residents coming to this Province to hunt, etc.
1946 ONTARIO PROVINCIAL POLICE 17
Sale or Possession of Explosives
The issue of Explosive Permits was discontinued December 30th, 1946.
This was a Wartime Measure under the Defence of Canada Regulations and
Order-in-Council 2903 was repealed on the above date.
In this connection, the following extract from a letter received from the
Chief Inspector of Explosives, Department of Mines and Resources, Ottawa,
is of interest, in that it shows appreciation of the assistance given by the per-
sonnel of this Force in enforcing the provisions of the Order-in-Council re-
ferred to :
"Dear Commissioner:
Order-in-Council P. C. 2903, 4th July, 1940, passed under authority of
The War Measures Act to regulate the sale, possession and use of explosives
will be repealed in the near future on a date not yet fixed. When the date of
repeal is set you will be notified at the earliest possible moment.
This Order-in-Council since it came into force has exercised a vital control
over the purchase and possession of explosives, and its value and usefulness
as a security measure has been greatly enhanced by the excellent support
given it by I'rovincial and Dominion authorities having responsibility for the
safe guarding of explosives.
May I take this opportunity of conveying to you and the members of your
Force the sincere thanks of the Explosives Division for the excellent co-
operation so generously given during the war years. The smooth operation
of this Order-in-Council in Ontario could not have been possible without
vour aid, and its success was in a large measure due to the interest taken by
members of your Force.
The issue of Explosives Purchase Permits placed added burdens on men
who were already working long hours and carrying heavy responsibilities
brought on by war conditions. The issue of permits must often have caused
considerable inconvenience to your men but the manner and spirit in which
they assisted, in spite of this and added duties, have been a source of great
satisfaction to us.
I trust that the many helpful and pleasant contacts made with members
of your Force throughout the Province may be renewed from time to time in
the future. May I again assure you, Sir, that we deeply appreciate the invalu-
able service you have rendered in the interest of public safety."
Departriieiital iMctor Transport
On December 31st. 1946. the Force was in possession of the following
motor transport :
Highway Patrol Cars (white) 101
UtiHty Cars (black and white) 81
General Purpose Cars 51
Trucks 2
Motor Cycle 1
TOTAL : 236
This is an increase of thirty motor vehicles over the number in operation
on December 31st, 1945. This increase is accounted fox by having to detail
an automobile for duty in certain municipalities now policed by members of
the Ontario Provincial Police, also additional equipment found necessary for
use by the Highway Patrol.
18
REPORT OF THE COAIMISSIONER OF THE
Xo. 34
DISTRIBUTION OF MOTOR \ EHICULAR EQUIPMENT
Headquarters
Districts
Totals
H.
Q.
1
2
3
4
5
6
7
8
9
10
11
12
13
Highway Patrol
Cars (white)
10
6
3
12
4
2
12
5
1
14
4
3
9
8
1
6
9
3
8
5
3
11
6
4
13
10
9
2
9
4
2
5
2
4
1
2
6
3
101
Utility Cars
(black & white)
General Purpose
Cars
Trucks
12
2
8,
51
?.
Motor Cycle
1
1
^ 1 1
TOTALS
14
19
18
18
21
19
18
16
21
32
15
9
5
11
236
DISTRIBUTION OF FORCE, DECEMBER 31st, 1946
u
<u
ll
OS
cr
w
c
<u
o
u
cq
c
>
pq
d
tn
5
d
'u.
d
CO
d
2
u
'u
tn
s
d
2
(J
d
/J
d
2
tn
s
d
2
d
2
u
to
d
2
!0
Q
0
d
2
4->
u
'/J
■q
d
2
5
d
2
•■J
to
^-\
C
2
fcC
c
0
1
1
3
10
1
t
.J
1
1
1
Staff In'^pectors
i
1
4
Chief Inspector, C.I.B
1
10
Registrar of Weapon
1
1
1
2
1
1
1
1
1
1
1
1
1
2
18
14
6
1
2
1
28
9
6
1
1
1
2
i i
1 21
1
3
1
1
1
1
1
1
14
2
2
?.?.
Sergeants (Patrol) .
1
2
17
11
5
1
3
27
13
8
6
Corporals
1
18
10
6
1
19
6
4
3
24
8
7
3
31
2
8
1
23
2
4
13
6
3
12
2
7
20
Provincial Constables
Prov Constables (Patrol)..
12
2
18 17
12 12
266
101
Prov Constables (Prob.) .
4
5
76
Supt. Police Garage
Asst. Supt. Police Garage
Chauffeurs
1
1
1
1
1
1
1
1
4
^lechanics
6
5
2
1
17
53
1
7
Garage Attendants
Accountants
5
?
Secretary
1
Clerks
Total Duty Strength
On Active Service
1
14
1
4
I
38
1
41|
1
39
1
40j
2
45
1
48
1
34
1
46
1
39
3
59
1
49
2
34
1
23
1
27
1
28
36
593
?.
TOTALS
53
14
4
38
41'
45 481
34'
46
391 591
49
34
23
—
SQ5
For purposes of administration the Province is divided into Headquarters
and thirteen "Districts," each District being- responsible for Law Enforcement
within a certain geog^raphical area.
Each District is divided into detachments with the detachment personnel
1946
ONTARIO PROVINCIAL POLICE
19
responsible for Police Activities within a designated area.
Detachments and the number of personnel are indicated in the following
table :
No. 1 District, Headquarters Windsor —
comprising the counties of Essex and Kent.
No. 2 District, Headquarters London —
comprising the counties of Lambton, Oxford, Middlesex and Elgin.
No. 3 District, Headquarters Hamilton —
comprising the counties of Wentworth, Brant, Halton and Norfolk.
No. 4 District, Headquarters Niagara Falls —
comprising the counties of Haldimand, Lincoln and Welland.
No. 5 District, Headquarters Aurora —
comprising the counties of York, Peel and Ontario.
No. 6 District, Headquarters Kitchener —
■ comprising the counties of Bruce, Perth, Grey, Wellington, Water-
loo and Huron.
No. 7 District, Headquarters Barrie —
comprising the counties of Simcoe and Dufferin, and the Districts
of Muskoka and Parry Sound.
No. 8 District, Headquarters Belleville —
comprising the counties of Victoria, Haliburton, Peterborough.
Northumberland and Durham, Hastings, Lennox and Addington,
Prince Edward and Frontenac.
No. 9 District, Headquarters Perth —
comprising the counties of Renfrew, Lanark, Dundas, Carleton,
Grenville, Russell, Prescott, Stormont, Glengarry and Leeds.
No. 10 District, Headquarters Haileyburj- — ■
comprising the Districts of Temiskaming, Cochrane, Nipissing and
a portion of Algoma.
No. 11 District, Headquarters Sudbury —
comprising the Districts of Sudbury, Manitoulin Island and a
portion of Algoma.
Xo. 12 District, Headquarters Port Arthur —
comprising the District of Thunder Bay.
No. 13 District, Headquarters Kenora —
comprising the Districts of Kenora, Rainy River and Patricia.
LOCATION OF MEMBERS OF FORCE
Station or
Detachment
Headquarters
Toronto
No. 1 District:
Windsor Hqrs
Amherstburg
Leamington
Belle River
Kingsville
Dresden
W'allaceburg
Chatham
Tilbury
Essex
Blenheim
Mersea Twp
Colchester South
Twp
Gosfield South Twp.
Officers
18
Sergeants
Corporals
Prov.
Cons.
12
Prov.
Cons.
H.P.
Mechanics
Clerks, etc.
2,7
12
2
1
20
REPORT OF THE COMMISSIONER OF THE
No. 34
LOCATION OF MEAIBERS OF FORCE— Continued
Station or
Detachment
Officers
Sergeants
Corporals
Prov.
Cons.
Prov.
Cons.
H.P.
Mechanics
Clerks, etc.
No. 2 District:
London Hqrs.
Strathroy
Sarnia
St. Thomas
Woodstock
Ingersoll
Forest
Lucan
Tillsonburg
Petrolia
Wardsville
Glencoe
Straff ordville
Wallacetown
No. 3 District:
Hamilton Hqrs.
Brantford
Brantford Twp.
Simcoe
Paris
Milton
A\"aterdown
Dundas
Oakville
Burlington
Delhi
Stoney Creek
Acton
Bronte
Mount Hope
Aldershot
No. 4 District:
Niagara Falls Hqrs.
Ridgeway
Welland
Cayuga
St. Catharines
Grimsby
Hagersville
Dunnville
Smithville
Beamsville
Fort Erie
Port Dalhousie
No. 5 District:
Aurora Hqrs
Toronto
Brampton
Cooksville
Oshawa
Whitby
Miniico
Uxbridge
Ajax
Richmond Hill
Islington
Port Credit
Birchcliffe
Willowdale
Scarboro Bluffs
Beaverton
Malton
Humber Bay
Thornhill
10
1
2
2
1
11
1
1
2
1
1
1
1946
ONTARIO PROVINCIAL POLICE
21
LOCA
TION OF
MEMBERS OF FORCE— Continued
vStation or
Detachment
Officers
Sergeants
Corporals
Prov.
Cons.
Prov.
Cons.
H.P.
Mechanics
Clerks, etc.
No. 6 District:
Kitchener Hqrs
Walkerton
1
1
1
1
2
1 . _
Wiarton
1
Goderich
Stratford
Listowel
1
Guelph
1
Flesherton
1
1 1
Owen Sound
Mitchell
Arthur . ..
Gait
Clinton
Kincardine
1
2
Mount Forest
:::::::: i :...:..::
No. 7 District: |
Barrie Headquarters 1 [ 1
Alliston 1 1
6
1
1
1
1
1
1
2
1
Midland
1
1
1
1
Orillia
Collingwood
Orangeville
Bracebridge
Huntsville. .
1
1
Gravenhurst
1
1
2
3
Parry Sound
Burks Falls
Bradford
1
Wasaga Beach
1
2
1
8
Bala
Town of Barrie
1
1
Bondhead
1
Tottenham
1
No. 8 District:
Belleville Hqrs
1
2
6
1
1
2
2
1
1
1
1
1
1
1
Madoc
Lindsay
1
1
Peterborough
1
Cobourg
Bownianville
1
Havelock
Haliburton
Frankford
Campbellford
•
Napanee
1
1
2
Colborne
Kingston
1
1
2
Bancroft
Picton
1
Brighton
1
1
Northbrook
Marmora
1
No. 9 District:
Perth Headquarters
1
2
7
1
3
1
1
1
1
2
Rockland
1
1
Cornwall
1
Eganville
Morrisburg
1
Renfrew
Pembroke
1
Kemptville
1
1
Ottawa
Brockville
1
.
3
1
1
22
REPORT OF THE COMMISSIONER OF THE
No. 34
LOCATION OF AIEMBERS OF FORCE— Continued
Station or
Detachment
Officers
Sergeants
Corporals
Prov.
Cons.
Prov.
Cons.
H.P.
Mechanics
Clerks, etc.
No. 9 District— Con.
Prescott
Hawkesbury
Casselman
Alexandria
Arnprior
Gananoque
Britannia Heights.
Barrj^'s Bay
Carleton Place
Rockcliffe Village.
Lancaster
\'ankleek Hill
Chalk River
Stonecliff
Toledo
Killaloe Station
Elgin
No. 10 District;
Haileybury Hqrs.
Iroquois Falls
Matheson
Elk Lake
Tinnnins
Kirkland Lake
Larder Lake
Kapuskasing
Englehart
North Bay
Sturgeon Falls
Mattawa
Temagami
Cochrane
Hearst
Powassan
Matachewan
Alatheson
AIcGarrv Twp.
Cobalt ..".
No. 11 District:
Sudbury Hqrs
Warren
Foleyet
Gore Bay
Sault Ste. Marie
Blind River
Chapleau
Bruce Mines
WaWa
Espanola Townsite.
McKim Township...
Neelon & Garson
Hornepayne
Gogama
Capreol
Espanola
Little Current
No. 12 District:
Port Arthur Hqrs...
Nipigon
Beardniore '....
Geraldton
Alarathon
1946
ONTARIO PROVINCIAL POLICE
23
LOCATION OF MEMBERS OF FORCE— Continued
Station or
Detachment
Officers
Sergeants
Corporals
Prov.
Cons.
Prov.
Cons.
H.P.
Mechanics
Clerks, etc
No. 12 District— Con.
Schrieber
2
1
1
1
Nakina
Terrace Bay
Armstrong
1
1
No. 13 District: | |
Kenora Hqrs | 1 1 1
4
3
2
2
1
4
1
1
Sioux Lookout 1
1
Dryden
Fort Frances
,...!!.^^!!!.!!^
1
1
1
Rainv River
Red Lake
Central Patricia
Ignace
Emo
:z:::: i ...:.....::;:.;.
1
1
1
Favourable Lake
Atikokan ,.
1
1
1
1
1
;
1
McKenzie Island
Hudson
1
1
Person?iel Strenijth
At midnight. December 31st, 1946. the total strength of all ranks of the
Force, inchiding; temporary and civilian personnel, was five hundred and
ninety-five (595), less two (2) members of the Force on Active Service with
the C.A.S.F., making: a total dutv streno;th of five himdred and ninetv-three
(593).
Personnel Increase
To provide the extra men necessary to police the several municipalities,
and to cope with the increase in traffic accidents and crime, additional Con-
stables have been appointed to the Force.
In selecting these recruits, only returned servicemen with a record of
scr\ice in an actual theatre of war are given consideration.
CHANGE IN PERSONNEL
During the period January 1st. 1946. to December 31st, 1946, the following
appointments to and retirements from the Force became effective :
APPOINTMENTS
Provincial Constables
107
PROMOTIONS
January 1st, 1946— Acting Inspector C. W. Wood, C.I.B.. Toronto, promoted to Inspector.
January 7th, 1946 — Provincial Constable E. L. Priest, Grimsby Detachment, promoted to
Corporal.
February 1st, 1946~Corporal \V. G. Tomlinson, A.G.S., G.H.Q., promoted to Sergeant.
February 1st, 1946 — Provincial Constable A. Macleod, Cobourg Detachment, promoted to
Acting Inspector, C.I.B., Toronto.
February 1st, 1946— Provincial Constable T. R. Wright, No. 2 District Headquarters,
London, promoted to Acting Inspector, C.I.B., Toronto.
February 1st, 1946— Provincial Constable W. H. Clark, No. 5 District Headquarters,
Toronto, promoted to Acting Inspector, C.I.B., Toronto.
March 1st, 1946— District Inspector F. B. Creasy, No. 11 District Headquarters. Sudburv.
pronioted to Staff Inspector.
April 1st, 1946 — Provincial Constable W. N. Peters, Elmvale Detachment, promoteed to
Corporal.
April 1st, 1946 — Provincial Constable E. M. Richardson, Red Lake Detachment, promoted
to Corporal.
24 REPORT OF THE COMMISSIONER OF THE No. 34
April 1st, 1946 — Provincial Constable J. S. McBain, Fort Frances Detachment, promoted
to Corporal.
May 1st, 1946 — Sergeant T. W. Wilkinson, No. 5 District Headquarters, Toronto, pro-
moted to District Inspector.
May 1st, 1946 — Provincial Constable T. W. Griffin, Hearst Detachment, promoted to
Corporal.
June 1st, 1946 — Corporal A. R. MacLeod. Pembroke Detachment, promoted to Sergeant.
June 1st, 1946 — Provincial Constable A. S. Ericksen, Rainy River Detachment, promoted
to Corporal.
July 1st, 1946 — Provincial Constable D. P. Morris, Peterborough Detachment, promoted
to Corporal.
July 1st, 1946 — Provincial Constable I. Robbie. Kincardine Detachment, promoted to
Corporal.
July 1st, 1946 — Provincial Constable J. R. Brown, Owen Sound Detachment, promoted
to Corporal.
July 1st, 1946 — Provincial Constable H. Ramsbottom, Flarrow Detachment, promoted
to Corporal.
July 1st, 1946 — Corporal H. H. Peel, Welland Detachment, promoted to Sergeant.
August 1st, 1946 — Clerk G. F. Long, CLE., Toronto, promoted to Provincial Constable.
September 1st, 1946 — Provincial Constable L. C. Carr, No. 9 District Headquarters, pro-
moted to Corporal.
November 1st, 1946 — Provincial Constable J. Bartlett, G.H.Q., promoted to Sergeant.
November 1st, 1946 — Provincial Constable A. M. Shaughnessy, G.H.Q., promoted to
Sergeant.
November 1st, 1946 — Corporal T. Riding, G.H.Q., promoted to Sergeant.
November 1st, 1946 — Provincial Constable J. H. Marsland, Pembroke Detachment, pro-
moted to Corporal.
December 1st, 1946 — Corporal G. \'. Clubbe, Brantford Detachment, promoted to Sergeant.
December 1st, 1946 — Sergeant A. J. B. Craik, No. 2 District Headquarters, London, pro-
moted to District Inspector.
DEATHS
July 13th, 1946 — Provincial Constable T. A. Suggett, Kingston Detachment.
SUPERANNUATED
December 31st, 1946 — District Inspector H. E. Thompson, No. 8 District Headquarters,
Belleville.
RESIGNATIONS
December 7th, 1945 — Provincial Constable D. H. Brown, Arnprior.
January 15th, 1946 — Provincial Constable A. A. Stark, Alexandria.
January 21st, 1946 — Provincial Constable A. J. McColl, Toronto.
February 9th, 1946 — Provincial Constable D. J. Jordan. Port Arthur.
February 11th, 1946— Provincial Constable J. D. G. Sutherland, Whitby.
February 15th, 1946 — Provincial Constable J. Barry, (Probationary) Sudbury.
March 9th, 1946 — Provincial Constable F. Hindle, London.
March 14th, 1946 — Provincial Constable E. J. MacMillan, London.
March 31st, 1946 — Provincial Constable O. LeBlanc, (Probationary) Alexandria.
March 31st, 1946— Provincial Constable J. C. Goodin, (Probationary) Ottawa.
March 31st, 1946— Provincial Constable L. E. West, Port Credit.
March 31st, 1946— Provincial Constable W. J. Burrell, Welland.
April 30th, 1946— Provincial Constable J. Blenkin, Toronto.
May 15th, 1946 — Provincial Constable H. J. Tinson, Belle River.
May 31st, 1946 — Provincial Constable A. O. Ferguson, Hawkesbury.
June 14th, 1946 — Provincial Constable J. A. Truaisch, Kingston.
June 15th, 1946— Provincial Constable D. C. Kennedj^ (Probationary) G.H.Q., Toronto.
June 22nd, 1946 — Provincial Constable C. W. O'Brien, Kingston.
June 24th, 1946— Provincial Constable J. J. Bilecky, (Probationary (G.H.Q., Toronto.
June 29th, 1946— Provincial Constable J. R. Dewar, (Probationary) Hearst.
June 29th, 1946 — Provincial Constable A. L. Weirmier, (Probationary) G.H.Q., Toronto.
July 1st, 1946— Provincial Constable O. H. Brown, Orangeville.
July 28th, 1946— Provincial Constable G. H. Ellis, Mount Forest.
July 31st, 1946— Provincial Constable W. Kennedy, Kenora.
July 31st, 1946 — Provincial Constable E. Rose, Brantford.
August 15th, 1946— Provincial Constable G. Dockray, (Probationary) Red Lake.
September 9th, 1946 — Provincial Constable E. A. Webb, London.
September 30th, 1946— Provincial Constable S. C. Bell, (Probationary) Ottawa.
October 7th, 1946— Provincial Constable W. E. EUett, Alexandria.
November 15th, 1946— Provincial Constable W. Marsland, Woodstock. r> rr r>>
November 30th, 1946— Provincial Constable W. O. Tougas, (Probationary) G.H.g.,
Toronto.
1946 ONTARIO PROVINCIAL POLICE 25
December 9th, 1946— Provincial Constable J. G. McMillan, Schreiber.
December 31st, 1946— Provincial Constable S. W. Bray, (Probationary) Tottenham.
DISMISSALS
January 6th, 1946 — Provincial Constable B. J. Gifford, Smith Falls.
January 14th, 1946 — Provincial Constable L. A. Maguire. Niagara Falls
April 25th, 1946— Provincial Constable J. D. Bennett, Woodstock.
June 21st, 1946 — Provincial Constable H. Lemon, Guelph.
November 27th, 1946 — Provincial Constable F. L. Thompson, Haileybury.
RETURNED FROM ACTIVE SERVICE
Provincial Constable W. A. Kennedy, January 7th, 1946.
Clerk R. Davis, January 21st, 1946.
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Provincia
Constable S. Ervine, January 21st, 1946.
Constable D. Adair, Januarv 21st, 1946.
Constable J. B. Sheff, January 23rd, 1946.
Constable V. P. Coffey, January 25th, 1946.
Constable R. E. Raymer, January 28th, 1946.
Constable L. M. MacGillivray, February 7th, 1946.
Constable V. L. Scherer, February 15th, 1946.
Constable M. A. Bruce, February 15th, 1946.
Constable J. A. Rodgers, February 15th, 1946.
Constable J. Craig, February 15th, 1946.
Constable A. S. Andrews, February 25th, 1946.
Constable J. D. Crosson, March 1st, 1946.
Constable J. F. Blenkin, March 11th, 1946.
Constable J. G. McMillan, March Uth, 1946.
Constable S. G. Batt, March 14th, 1946.
Constable R. J. Spofford, March 15th, 1946.
Constable E. F. Wright, March 15th, 1946.
Constable G. G. Barber, March 25th, 1946.
Constable J. E. Johnson, July 24th, 1946.
Constable J. W. Callander. October 15th, 1946.
Constable L. L. Shipley, November 15th, 1946.
The following meinbers of the Force are still on Leave of Absence for
War Services :
Barker, F. L Provincial Constable July 15th, 1942 C.A.S.F.
Callaghan, E. S Provincial Constable October 14th, 1941 C.A.S.F.
Commendations
The following- members of the Force were commended in Police Orders
for outstanding service :
Provincial Constable E. M. Richardson, Fort Frances Detachment.
Provincial Constable W. A. Parfitt, Fort Frances Detachment.
Provincial Constable R. A. Young, Emo Detachment.
Provincial Constable A. S. Ericksen, Rainy River Detachment.
District Inspector F. B. Creasy, No. 11 District Headquarters, Sudbury.
Sergeant N. C. Smaill, No. 11 District Headquarters, Sudbury.
Provincial Constable J. S. McBain, No. 11 District Headquarters, Sudbury.
Provincial Constable R. H. Pepper, Warren Detachment.
Provincial Constable D. H. Porter, North Bay Detachment. .
Provincial Constable R. E. Penner, Temagami Detachment.
Inspector G. Mackay, C.I.B., Toronto (2).
Provincial Constable L. Neil, No. 1 District Headquarters, Windsor (2).
Provincial Constable K. W. McLaj^ Delhi Detachment.
Provincial Constable W. J. McBride, St. Catharines Detachment (2).
Provincial Constable N. P. Budd, St. Catharines Detachment (2).
Provincial Constable T. W. Griffin, Hearst Detachment.
Inspector W. J. Franks, C.I.B., Toronto (2).
Sergeant C. W. Farrow, No. 3 District Headquarters, Hamilton.
Provincial Constable R. Reynolds, Brantford Detachment.
Corporal W. G. Tomlinson, Anti-Gambling Squad, Headquarters, Toronto.
Provincial Constable C. Von Zuben, Anti-Gambling Squad, Headquarters, Toronto.
Provincial Constable J. F. Cronin, Anti-Gainbling Squad, Headquarters, Toronto.
Provincial Constable J. E. Legate, Anti-Gambling Squad, Headquarters, Toronto.
26 REPORT OF THE COMMISSIONER OF THE No. 34
Acting Inspector C. W. Wood, C.I.B.. Toronto (3).
Provincial Constable N. P. Fach, St. Catharines Detachment (2).
Provincial Constable J. F. Craig, Geraldton Detachment.
Sergeant J. A. Stringer, No. 6 District Headquarters, Kitchener.
Provincial Constable H. Gibson, No. 6 District Headquarters, Kitchener.
Provincial Constable B. R. Woods, No. 6 District Headquarters, Kitchener.
Provincial Constable L. Mej'er, No. 6 District Headquarters, Kitchener.
Inspector F. C. Kelly, CLE., Toronto (3).
Provincial Constable G. Yuile, Brampton Detachment (2).
Provincial Constable L. R. Taylor, No. 3 District Headquarters, Hamilton.
Provincial Constable F. Fox, Goderich Detachment.
Provincial Constable W. Wellheiser, No. 2 District Headquarters, London.
Inspector W^ H. Lougheed, CLE.., Toronto.
Inspector W'. H. Kennedy, CLE., Toronto (2).
Sergeant W. D. Duncan, No. 1 District Headquarters, Windsor.
Provincial Constable W. E. Smith, Napanee Detachment
Provincial Constable T. H. Trimble, Ottawa Detachment.
Provincial Constable J. A. Morden, Napanee Detachment.
Acting Inspector W. H. Clark, CLE., Toronto.
Inspector E. C Gurnett, CLE., Toronto (2).
Provincial Constable L. W^. Johns, No. 5 District Headquarters, Toronto.
Provincial Constable J. E. Johnson, Wiarton Detachment.
Provincial Constable J. Brown, Owen Sound Detachment.
District Inspection
I visited all Districts and a number of separate Detachments during the
3'ear, where I reviewed personnel and inspected nniform and office equipment.
I also conferred Avith jitdicial officials and leading citizens regarding the
work of the Force.
I found the memljers of the Force to l)e held in high esteem, and law
enforcement to be generally satisfactory.
I also held investigations into complaints of misconduct by members of
the Force, and, where necessary, recommended certain disciplinary action
for your approval.
Conduct and Discipline
The conduct and discipline of all ranks has, with minor exceptions, l)een
excellent, and a high standard of efficiency has been maintained.
The members of the Force have shown a commendable spirit of loyalt}'
and service in the manner in which they have performed their duty. Many
letters of commendation have been received speaking in the highest terms of
courtesy shown and services rendered by members of the Force.
7\-,
aining School
During the spring and early summer of 1946. three sessions of our Train-
ing School were held, commencing on February 11th, May 1st, and Jime 11th.
1946. Each session lasted approximately six weeks and had an attendance
of twenty, twenty-seven, and nineteen respectively. All were recruits.
The instruction given at each of these classes covered a wide field of law
enforcement matters and interior economy of the Force.
Since the removal of our Headquarters to 13 Queen's Park Crescent, we
have space set aside for a school room, and are now able to conduct our train-
ing of recruits under more favourable conditions than in the past. The school
is now functioning as an integral part of our Headquarters administration
with a Staff Inspector in charge of training.
1946 ONTARIO PROVINCIAL POLICE 27
We have held one session of the school in our new quarters which com-
menced on October 15th, and lasted until November 29th, with thirty recruits
in attendance.
The four sessions of the school held during- the year were very successful
and started the new men on their chosen career with an elementary knowledge
of their duties and what is required of them as servants of the public.
DEATHS FROM ACCIDENTS, MISADVENTURES, ETC.
7 ornado, Essex County
At about 6:00 p.m.. June 17th, 1946, a tornado which began at River
Rouge, Michigan, quickly crossed the Detroit River, and struck with all its
fury on the Canadian shore at O jib way. The tornado, a swirling black finger
of destruction, cutting a swath 100 to 400 feet -wide, lashed its way through
Ojibway and the townships of Sandwich West and East which border on the
city of Windsor and spent itself on Lake St. Clair. It had, in twenty minutes,
created havoc and devastation never before witnessed in these parts. Men,
women, children, animals, vehicles, homes and other buildings were sucked
into its vortex and spun out again, shattered into hundreds of frag-ments.
Seventeen people were killed and many injured and left homeless. Windsor
was without electricity for almost 24 hours with its accompanied burden on
all hospitals and public services. $500,000.00 was the estimation of property
damage. Services were volunteered by Red Cross, various organizations and
individuals. The Windsor Daily Star started a relief fund and it was quickly
organized with sums of money donated from various parts of Canada and the
United vStates.
City and township officials met and conferred with police on general
conditions following the storm. Wires were down, roads were blocked and
looting of property and an influx of sightseers resulted in a request to the
Attorney-General for the assistance of the Provincial Police. The majority
of the local detachment was absent on strike duty. In response to this plea,
thirty-one Provincial Police officers and men were sent into this District and
placed strategically throughout the storm area on June 22nd and 23rd. On
June 24th, the officials of the municipalities expressed their appreciation for
the services of the police. The situation was under control, and they were
forthwith returned to their respective Districts.
D(structi(jii by Fue, Richmond Toivnsliipj Lennox County
At approximately 4:30 a.m., February 5th, 1946, a frame house situated
on what is known as the Old Belleville Road in Richmond Township, about
four and one-half miles west of Napanee caught fire and burned to the ground.
Within, four persons were fatally burned, namely ; Reginald Brown, age 48
years.owner of the residence; Margaret Brown, age 15 years; Aileen Brown,
age 13 years; and Ivan Wager, age 3 years and nine months.
The fire originated in the kitchen from an overheated stove and almost
immediately the entire dwelling became a raging inferno which left no avenue
of escape for the unfortunate occvipants.
Coroner, Doctor T. M. Galbraith of Napanee was in attendance and after
viewing the remains of the four deceased persons instructed that no inquest
was necessary.
Death by Suffjcation , Hastings County
At 6:30 a.m.. November 18th, 1946. while one Ephriam Ray of the village
28 REPORT OF THE COMMISSIONER OF THE No. 34
of Madoc was attending his morning chores, he noticed that the second storey
of his home was on fire. Ray immediately attempted to enter the burning
house with a view of rescuing his wife and six children who were asleep
therein. Each time he attempted to enter the burning house he was driven
back by the intense heat. He finally collapsed to the ground exhausted from
fumes and smoke.
Every possible effort was made to rescue the occupants of this house but
to no avail. The fire itself was almost instantaneously beyond control and
fire fighting could only be employed to prevent it from spreading to the sur-
rounding buildings.
Searchers found the bodies of Mrs. Velma Ray and her six children still
in the positions that had been assumed by the deceased persons in sleep, and
this led to the belief they were suffocated in their sleep by the heavy smoke
and fumes.
The remains of the deceased persons, namely : Mrs. Velma Ray, age 30
years; Douglas, age 11 3^ears; Doreen, age 9 years; Allan, age 7 years; Ella,
age 5 years ; Dianna, age 3 years ; and Emerson, age 10 months were viewed
by the Coroner, Doctor S. R. Beatty of Madoc, who ordered an inquest to be
held in Madoc on November 21st, at which time the Coroner's Jury returned
a verdict, attaching no blame to Ephriam Ray and commended him for his
gallant efforts to save his family.
Traffic Fatalities
Four Persons Killed, liiahivny 15, Lanark County
On September 2nd, 1946, an auto fatality occurred on Highway Number
15 near Crosbey in Lanark County in which Morley McNish, Bertha Anerey,
Isabel Mills and James Caskie, all of Toronto, were killed.
Investigation showed the fatality was due to excessive speed on a curve.
live Persons Killed. Highivay 17 , Carlton County
On Octol)er 12th, 1946, an automobile containing six persons was parked
on Number 17 Highway west of Alfred, unable to proceed on account of
defective lights, when a transport tractor and trailer crashed into the auto-
mobile. George Desormeaux ; his wife Ella; George Desormeaux, Jr., and
his wife Helen ; and Pauline Desormeaux, age 8 years, were killed. Antoinette,
age 12 years, was the only one saved.
In this case the auto took fire which prevented immediate recovery of
the bodies of the deceased persons.
Drownings
Deaths from Drowning, Ottawa River
On May 25th, 1946, it was reported to the Pembroke Detachment that
Joseph Lavoie, father, and his two children, Telesphore and Jeanette. had been
drowned whilst crossing the OttaAva River from Malakoff, Quebec, to Mackey
Station, Ontario.
The bodies of Joseph and Telesphore Lavoie were recovered on July
2nd, 1946.
1946 ONTARIO PROVINCIAL POLICE 29
Deaths from Drou<nin(j, St. Laivrence River
On August 18th, 1946, William Barnes, Gordon Robertson, and Roland
Parthenais, all of Cornwall, were drowned whilst crossing the St. Lawrence
River near Flannigan's Point.
All three bodies were recovered.
Missiu'j Person
James TV edgery , .Missinff from C.N.R. Train, Ferland
On September 10th, 1946, a telegram was received from Superintendent
G. T. Dunn, Canadian National Railways, Hornepayne, that one James Wed-
gery w^as missing. The Armstrong Detachment was detailed by telegram to
this investigation and it was learned that Wcdgery, age 78 years, a retired
C.N.R. brakeman, left the home of his sister, Mrs. W. C. Neal, Woodstock,
Ontario, on September 7th, enroute to Dauphin, Manitoba. Mr. Wedgery,
who suffered from brief spells of amnesia, is alleged to have had a large sum
of money in his possession, also bank books, etc. He was last seen wdien
train number 3 stopped at Ferland, Ontario, in the Thunder Bay District on
September 8th, 1946. Extensive searches have been made by members of the
C.N.R., The Department of Lands and Forests, also this Department. En-
quiries have been made through the Royal Canadian Mounted Police in Mani-
toba and descriptive circvilars were distributed throughout the Province.
Searches were continued until the middle of November when snow made
further search impossible. Investigations are still being continued although
it is believed that Wedgery, on leaving the train, wandered into the surround-
ing bush and became exhausted and died or was able to board another train
and disappeared for parts unknown.
Registration of Firearms
The following is a summary of permits issued by the Firearms Regis-
tration Branch during the year :
Vendor's Permit;
Eight Vendor's Permits to buy and sell revolvers and pistols were issued
to sporting goods dealers. Before a permit is issued each dealer is thoroughly
investigated by the District Inspector concerned and a recommendation or
otherwise submitted by him. A number of applications for such permits
have been received from individuals requesting permission to operate from
their private residences. These have all been refused and permits issued
only to persons operating a recognized store in premises set aside for such
business only.
Purchase Permits
The great volume of work entailed in this branch is brought about by the
transfer of weapons between individuals. The loan, sale, or gift of a revolver
or pistol requires the submission of an application by the receiver of the
weapon w^ho can properly supply all details of the w^eapon to be transferred
and the application must be recommended by a senior police official within
whose district the recipient resides. A permit is not issued until the w^eapon
has been checked to show that it is legally possessed. The transfer is not
complete until a Record of Sale Card, which is made out at this office, has
30 REPORT OF THE COMMISSIONER OF THE No. 34
been signed by the seller and mailed to this office to show that the exchange
has been made.
Carrying Permits
In administering the law regarding the carrying of concealed weapons,
an endeavour has been made to exercise care not to interfere with the rights
of individuals, but the fewer people carrying concealed weapons the better,
therefore, permits have been issued only to persons who could show that it
was necessary and in the interests of public safety.
Almost all new permits to carry were issued to banks, trust companies,
express companies, large firms for payroll protection, and to members of
revolver clubs.
Numerous applications were received from Canadian and American
sportsmen for the privilege of carrying revolvers or pistols while hunting and
fishing. These requests were properly refused as it is felt that the possession
of such weapons at hunting and fishing camps was unnecessary.
A considerable number of Carrying Permits sent in for renewal were
cancelled when a check showed that the original reason for issue no longer
existed.
Jliens' Permits
United States sportsmen still require a permit from this office to possess
rifles and shotguns while in the Province of Ontario. The hunting season
rush was satisfactorily handled with the assistance of our Fort Frances
Detachment. The latter took care of American sportsmen who entered On-
tario at that point. A new system was put into effect whereby American
sportsmen were instructed to retain their Permits and return them to this
office for renewal at the beginning of each year. This has had very favourable
results and has cut down the work of the branch considerably.
A considerable number of permits were issued to Aliens of good character
residing in Ontario who turned in their weapons at the beginning of the war.
These firearms have been returned to their owners.
Explosive Permits
The issuing of Explosive Permits was discontinued on December 31st,
1946. This was a Wartime measure under The Defence of Canada Regula-
tions. Permits are, therefore, no longer necessary for bona fide British sub-
jects to purchase or possess explosives in Canada.
Stolen TVeapons
A number of stolen weapons were located and returned to their rightful
owners.
Canadian or United States Government Property
A check was made with the Royal Canadian Mounted Police, Ottawa, on
any weapons which appeared to be Canadian or U.S. Government property.
As a result, several were seized and turned over to the Canadian Army
Ordnance, Toronto, and the Military Attache, U.S. Embassy, Ottawa, Ontario.
1946 ONTARIO PROVINCIAL POLICE 31
AUTOMATIC FIREARMS REGULATION, 1945
This deals with fully automatic firearms such as machine guns and sub-
machine guns. The only permits issued under this regulation during the year
1946 are as follows :
Five (5) to enable such weapons to be given or sold to regularly organized
police departments in the Province for law enforcement purposes ;
Three (3) to recognized public museums to possess old type machine
guns, souvenirs of World War I, of a weight and in such a mechanical con-
dition as to preclude their use for illegal purposes;
Ten (10) to individuals to possess old type machine guns, souvenirs of
World War I, all in such mechanical condition as to prevent their illegal use;
One (1) to permit a Bren gun to he given to a Sea Cadet Corps for in-
structional purposes but minus certain mechanical parts and could not be fired;
One (1) to permit a machine gun to be given to the National Defence
Museum ; and
One (1) was issued to enable an arms manufacturing concern to retain
samples of modern automatic firearms manufactured here during the last
World War.
In all other applications for permits for this type of weapon, the weapons
themselves were seized and turned over to the Royal Canadian Mounted
Police, in accordance with the regulations.
In the enforcement of this regulation, we have worked in \er_\- close
co-operation with the Royal Canadian ^Mounted Police.
INDUSTRIAL UNREST
Anaconda-A rni'iican Brass Limited, New Toronto
On May 17th. 1946, local 811, a br?nch of The Mine, :^Iill and Smelter
Workers' Union C.I.O. called a strike at the plant of the Anaconda-American
Rrass Limited, which affected approximately fourteen hundred employees.
After the walk-out, the plant ceased to operate and temporary office
quarters were taken up l)y the company officials in the local hotel. The plant
and offices of the company were picketed by the strikers at first in small
numbers, and the municipal police force assigned a limited number of officers
at the request of the plant officials to protect their property.
No incident of note occurred for some time, and the matter was treated
as a purely local one. xA.ttempts had been made by those interested to negotiate
a satisfactory settlement, but these failed.
The company claimed that access to the office and plant premises of em-
l)loyees outside the bargaining miit was not a matter of negotiation. The
union agreed to this principal, but with the proviso that a list of such per-
sonnel be supplied them in order that they could be checked off by pickets
upon entering the offices. When this personnel attempted to pass the picket
line, admission was refused them ; whereupon the company applied to the
municipal authorities for additional police protection, and when it was not
forthcoming, the company brought the matter before members of the local
coimcil with the result that police assistance was officially applied for to the
32 REPORT OF THE COMMISSIONER OF THE No. 34
Attorne3--General. Conditions regarding the strike-bound plant had become
progressively worse as the picket line had been greatly increased, which
resulted in traffic tie-ups with instances of interference on the part of the
strikers with the police.
Due to the fact that all available members of this Force were already on
strike duty stationed at various points in the Province, only a few could be
sent into New Toronto to aug'nient the local force.
The strength of the force engaged was increased on June 27th, to a total
of seventy-nine, all ranks, as they were withdrawn from the Seamens' Welland
Ship Canal strike area. The union leaders greatly increased their picket lines
and showed by their bearing a desire to challenge the authority of the police.
Before any action was taken by the police at the scene, the officers in
charge consulted with the Union's International Organizer, and sought his
co-operation in a verbal request to the strikers to disperse, which would leave
a reasonable picket line to carry on. This request was ignored, even after he
acknowledged that he was fully aware of the fact that by his refusal to assist
the police he was placing the offenders in jeopardy. The police then ordered
the strikers to disperse. A number refused to do so and force had to be used
to carry out the lawful order. A melee occurred and when it subsided, four
of the striking participants were taken into custody on charges of Obstruction.
A large group of the strikers converged on the police automobile before it
could be driven off, in an attempt to liberate the prisoners. Their action
proved abortive but some property damage occurred to the police car. In
due course the prisoners were admitted to bail. Subsequently the accused
men had their trials before a magistrate, when two of the offenders were con-
victed, fined and costs levied.
After consultation with the crown attorney, the two union heads were
charged with violation of Section 501 (f) of the Criminal Code, and after a
lengthy trial covering several days, the trial magistrate convicted both men
of Watching and Besetting, as provided for in the law, and the maximum
fines were levied.
On or about October 28th, 1946, the management and employees arrived
at what was considered a satisfactory settlement and the plant again Avas
prepared, after five months complete shut-down, to continue production.
This permitted members of this Force to be returned to their regular
duties.
In connection with the Anaconda-American strike, the decision rendered
by iMagistrate John E. Pritchard at New Toronto should be of considerable
interest to Police Departments when dealing with future strikes or picketing.
Bernard Doherty, International Representative of the Union of Mine.
Mill and Smelter Works, and Jack Stewart, President of the New Toronto
Branch of the Union, were jointly charged "That they did at the town of New
Toronto in the County of York, during the months of May and June in the
vear 1946, wrongfully and without lawful authority, with a view to compelling
certain employees of the Anaconda-American Brass Limited, and others, to
abstain from doing what they had a lawful right to do, namely to work for
and carry on their employment with the Anaconda-American Brass Ltd.,
beset and watch the premises of the said Anaconda-American Brass Limited
contrary to Section 501 (f) of the Criminal Code."
1946 ONTARIO PROVINCIAL POLICE 33
The case was tried summarily by the Magistrate who held :
(1) that it is a fundamental principle of the law that if picketing" is con-
ducted in a manner which creates an obstruction, unlawful assembly, violence
or trespass, it is then being carried on "wrongfully and without lawful au-
thority," and constitutes an offence under Section 501 of the Criminal Code.
(2) that the actions of the accused extended far beyond the mere act of
obtaining or communicating information permitted under Section 501 (g),
and were therefore wrongful and without lawful authority and a violation of
Section 501 (f), and found upon the evidence that the charge against both
of the accused had been proven beyond any reasonable doubt and registered
a conviction. Both defendants were fined $100.00 and costs or three months
imprisonment in default.
Seamen's S/rike-J esseh' Sailing on fFaters of the Great Lakes
On May 25th, 1946, when the steamer "Noronic," a Canadian registered
vessel engaged in passenger and freight traffic on the Great Lakes docked in
the Welland Ship Canal, Thorold Township, Welland County, carrying some
440 passengers, bound from Prescott. Ontario, to Cleveland, Ohio, the ship's
crew, (jMembers of the Canadian Seamens' International Union T.L.C.) left
the ship in accordance with the union's instructions that a strike had been
called. The union installed a picket line on the shore.
The captain of the "Noronic" two days later laid charges and warrants
were issued by the local county authorities against thirty members of the
crew for neglect of duty and being absent without leave under the provisions
of the Canada Shipping Act.
Certain unlawful acts were committed, and the ship owners complained
to the police authorities, and requested protection for their personnel and
property. Thorold Township Police executed the warrants on the erring
crew members without further violence, but rumors spread, picket lines were
greatly reinforced and the pickets armed themselves with staves, and took on
a belligerent attitude. As time progressed, numerous other large freighters
passing through the Welland Canal experienced similar action on the part of
their crews leaving their ships as soon as the ships docked. Tents were
erected and the striking crews practically controlled the Canal system.
The ship owners 1)ecame alarmed at the show of force and asked for
greatly increased police protection as they were fearful of their property in
its present unprotected condition. They also proposed replacing some of the
striking crews on vessels carrying urgent freight loads. This action might
precipitate more violence and result in bloodshed or serious damage to their
property. The township of Thorold could not supply the required police
protection and this was made known to the Attorney-General through the
elected township head.
As a result, a detachment of fifty-three officers and men of this Force,
drawn from adjacent territory was ordered to the Welland Canal to render
assistance to the local police authority, should the circumstances warrant.
Numerous other crews from lake-going vessels of Canadian registry upon
docking in the Canal zone left their ships and joined in the strike movement,
thus producing a serious state of congestion of both ships and striking seamen,
which left the ship owners faced with problems they were unable to handle.
Memliers of this Force assisted by a detachment of Royal Canadian Mounted
Police were called upon to police the banks of the Canal system and its num-
34 REPORT OF THE COMMISSIONER OF THE No. 34
erous locks connecting Lake Erie and Lake Ontario, a distance of approxi-
mately twenty-three miles. This problem required a greatly increased police
personnel in order to render adequate protection for the stranded laden vessels
that were blocking the Canal.
The strike action daily grew in proportions and gradually it affected
hundreds of vessels and their crews engaged in the movement of goods on the
Great Lakes. The police forces involved had to reinforce their numbers on
the Welland Ship Canal until a maximum of one hundred and forty-two mem-
bers of the Ontario Provincial Police and fifty-two members of the R.C.M.
Police concentrated at that point. However, the deportment of the strikers
in general was good and little property damage was done.
On June 24th, 1946, a federally appointed Controller of Ships took over
the movement of vessels tied up in the Canal and events developed satisfac-
torily between the union and the ship owners to such an extent that crews
could be placed aboard and the ships got under way. The following day,
June 25th, shipping conditions resumed normalcy in the Welland Ship Canal
and the Ontario Provincial Police and the R.C.M. P. contingents from that
area were ordered out and they resumed their respective duties at other points.
Reports from many Canadian ports showed that the strike action taken
by the Canadian seamen affected the whole of the Great Lakes. Sporadic
skirmishes between pickets and the police took place but these were principally
confined to minor infractions of the law, with the exception of an incident
reported in the St. Lawrence Canal Waterways, Cornwall Division. On June
3rd, 1946, the ships, the City of Windsor, and the City of Hamilton, eastbound,
passing through Lock Number 21, ,were boarded by about a dozen striking
seamen who seized the ships' emergency axes, did considerable damage and
then let the anchors go, thereby endangering all shipping in the Canal.
At the time, a detachment of forty-three officers and men of the R.C.M.
Police were performing guard duty on the locks situated in Cornwall Town-
ship. The ship owners were incensed at what they determined was inadequate
police action and complaints were lodged with the local authorities, the Board
of Commissioners of Police for Cornwall and the Township of Cornwall
wherein the incidents occurred. As a result, on June 4tli, 1946. the city of
Cornwall Board of Police Commissioners made written application to the
Attorney-General of Ontario for police reinforcements for strike duty in their
city. On the same date a contingent of sixty-three micmbers of the Ontario
Provincial Police moved into the Cornwall area to supplement the R.C.M. P.
detachment and the municipal forces.
Prior to the arrival of the Ontario Provincial Police to the strike area, the
municipal police in Cornwall Township clashed with a group of men who had
evidently been engaged by some person in Montreal to act as strike-breakers.
They had attacked and injured a number of the striking seamen who had to
be hospitalized as wounds had been inflicted by the Montreal culprits Avho
were armed with weapons of various types selected for the affray.
As is the case of the Welland Ship Canal, the Dominion Government
nominated a Controller of Ships, whose duty it was to arrange for the move-
ment of vessels within the Canal. The police worked in co-operation with
this official. On or about June 23rd, 1946, the union representatives and the
ship owners arrived at a compromise settlement and the stranded vessels got
under way. On June 24th, all members of the police forces were withdrawn
and returned to their regular duties.
This Seamens' Strike proved to be one of the most costly disputes experi-
1946 ONTARIO PROVINCIAL POLICE 35
enced in the industrial history of Canada.
The following occurrence resulting" from the Seamens' Strike is worthy
of note :
On June 20th, 1946, a report was received at District Headquarters,
Niagara Falls, that a man had been taken to the Welland County Hospital in
a serious condition as the result of having been badly beaten.
On investigation it was found that the man was one Alexander Morrison
of Toronto, an agent of the Pinkerton Detective Agency, and that whilst in
the lobby of the Colonial Hotel, Port Colborne. he had been forcibly seized
by four men, carried to an automobile, taken out into the country, stripped,
robbed, beaten up and abandoned.
From information obtained, six men were eventually arrested. All were
connected with the Seamens' Union, to wit : John Thompson of Toronto ;
Mike Ganyk, no fixed abode ; Ray Tessier, Toronto ; Joe Grabbich ; Harry
Davis ; and Marcel Lavoir, all of Montreal.
All were charged Robbery with \"iolence under Section 445 of the Crim-
inal Code.
Thompson, Tessier, Grabbich. and Davis pleaded not guilty and were
committed for trial. They appeared before Judge Fuller at Welland on
December 6th, 1946, with the follow^ing results :
John Thompson — convicted and sentenced to three years in Kingston
Penitentiary.
Mike Ganyk- — al)sconded while on bail and has not been tried yet,
Ray Tessier — charge dismissed,
Joseph Grabbich— charge dismissed,
Harry Davis — ( V'ice-President, C.S.U.) charge withdrawn,
Marcel Lavoir — pleaded guilty before the magistrate as charged and
sentenced to six months in Ontario Reformatory.
Seizing and Confining of F. Neilson, Thunder Bay District
This case was somewhat unusual and also arose during the strike of the
Canadian Seamens' Union. John Hicks, one of the strikers was appointed
captain of the pickets at Jackfish, Ontario. Apparently on the instructions
of Cyril E. Lenton, Treasurer of the Canadian Seamens' Union, he detained
one Frank Neilson, an employee of the Colonial Steamships.
When Hicks was interviewed at Jackfish on June 2nd, and questioned as
to his reason for detaining Neilson, he produced a telegram purporting to
have l)een received from Cyril E. Lenton, Treasurer, Canadian Seamens'
Union, Fort William, in which Hicks was instructed to "hold official," and
"congratulating him on his good work." This matter was discussed with Mr.
P. V. Ibbetson, Crown Attorney, Port Arthur, who issued instructions to lay
charges against both Lenton and Hicks under Section 297 (b) Criminal Code.
Warrants were issued and both men arrested and later released on bail of
$1,000.00. The case finally came to trial before District Judge T. M. Mulligan,
Pf)rt Arthur, on November 14th, and the following verdicts returned :
Both prisoners found "not guilty" conspiring to hold Frank Neilson,
Section 573 Criminal Code ;
36 REPORT OF THE COMMISSIONER OF THE No. 34
Both prisoners found "not guilty" conspiring to hold officer, S.S. Kenora,
Section 573 Criminal Code;
Both prisoners found "guilty" of Seizing and Confining Frank Neilson,
Section 297 (b), (c) Criminal Code;
Both prisoners found "guilty" of Intimidation, Section 501 Criminal Code.
On November 21st, 1946, both Lenton and Hicks were sentenced to serve
three months in the common Gaol under Section 297 (b) Criminal Code, and
one hundred dollars and costs under Section 501 Criminal Code, or in default
three months in common Gaol.
Slrike, Steel Company of Canada Limited — Hamilton
On July 14th, 1946, the Union representatives of the Steel Company of
Canada Limited, affiliated with the United Steel Workers of America, C.C.L.,
C.I.O., called a strike at the plant located in the City of Hamilton, Wentworth
County, whilst Mr. Justice W. D. Roach was sitting on a Board of Inquiry
mediating the wage dispute between the Steel Companies and the Steel
Workers' Union.
As a means of continuing the operation of the companies in the essential
work of producing steel, pending a settlement of the dispute, the Federal
Government appointed Mr. F. B. Kilbourn and three Deputies to operate the
mills. The Order-in-Council directed all employees to continue to perform
their duties. Notwithstanding this Order, the National Advisory Committee
of the union ordered a strike. However, approximately twenty-five hundred
men chose to remain at their jol)s in the Hamilton plant of the Steel Company.
Those charged with law enforcement in the strike-bound area avoided
taking any action that might eml^roil the police in the dispute. The strikers
set up a picket line at the plant, and the local chief constable assigned members
of his force for duty at the scene. Some of the workmen that remained at
their jobs soon complained they had been attacked and beaten on the streets
enroute after visiting their families.
Reports of clashes between strikers and non-strikers in and about the
waters of Hamilton Bay were received. Those situated outside of local police
jurisdiction were investigated by members of this Force attached to Hamilton
Headquarters.
This strike with its contributing incidents produced a condition of great
fear on the populace, and the issue was debated in meetings held by the city
council. Resolutions by that bod}* were passed which brought the matter
before the Board of Commissioners of Police. This Board held an enquiry
which terminated in an appeal to The Attorney-General for adequate police
assistance to maintain law and order.
On August 26th, 1946, a company of two hundrd and twenty-five officers
and men from the ranks of the R.C.M. Police, along with two hundred and
fourteen officers and men from the Ontario Provincial Police arrived at Hamil-
ton to render assistance to that city's municipal police force. The R.C.M. P.
detachments' billets were in the Army Trades School on Kennilworth Avenue,
and the Ontario Provincial Police detachments were quartered in the Navy
barracks, H.M.C.S. "Star," for a period of some forty days.
The auxiliary forces assisted the municipal force in maintaining order and
preventing violence.
1946 ONTARIO PROVINCIAL POLICE ^7
Fortunately for all concerned, no serious clashes between strikers and
police took place after the arrival of the police reinforcements. On or about
October 4th, 1946, strike action was concluded and the members of this Force
returned to their regular duties.
DushiPtn's Strike, Thunder Bay and Cochrane Districts
On October 12th, 1946, the Lumber and Sawmill Workers' Union, Local
Nos. 2786 and 2995 (affiliated with the parent union — the American Federation
of Labour) called for strike action in the bush areas of Thunder Bay and
Cochrane Districts located in the northern sections of Ontario, after negoti-
ations between union members and timber mill operators failed at Port
Arthur. However, a walk-out did not actually take place until after further
attempts were made by The Honourable Charles Daly. Minister of Labour,
to negotiate between union representatives and the bush and mill employers,
without satisfactory results.
A mass picket line of approximately seventy-five strikers and their
sympathizers concentrated their attention in the vicinity of the Feldman Saw
Mill and by their actions indicated an intent to violate the law. On October
16th, 1946, a detachment of sixty members from this Force arrived at Tini-
mins for strike duty in the Cochrane District. Twenty-eight members were
stationed at Timmins, twenty-four were sent to Hearst and eight were
stationed at Connaught.
On October 20th, 1946, approximately one hundred and twenty-five
strikers left Hearst in four trucks, and visited four different bush camps which
covered a radius of forty miles. They endeavoured to persuade the workers
engaged there to come out on strike. Members of this Force were present
and the strikers object was not accomplished.
Non-union personnel was obtained and passed through the picket lines.
This action was resented by the strikers and instructions were given to organ-
ize a raid on Feldman's Mill to destroy the sawing machinery. On the night
of October 21st. a gang of strikers set about to accomplish this. They suc-
ceeded in eluding the police on duty at the scene but were discovered before
they could carry out their mission. Nine men were arrested and four were
held as material witnesses. Leo Barrette, a strike leader, was arrested and
charged with Counseling, contrary to Section 69 (d) of the Criminal Code.
He appeared in the Magistrate's court, November 5th, 1946, pleaded guilty to
the charge and was fined $50.00 and costs.
On October 24th. 1946, a group of thirty-nine strikers raided a bush camp
operated by the Driftwood Lumber Company and forcibly compelled workers
to leave their work. Three leaders of .the gang were arrested and charged
under Section 501 and its subsections of the Criminal Code. On November
12th, 1946, they were convicted in Magistrate's court at Hearst and fined
various amounts up to $50.00 and costs.
Several strikers were arrested and charged with "Intimidation," under
Section 501 (a) (b) and (c) of the Criminal Code. These charges were dis-
posed of in the Magistrate's court in Hearst on November 12th, 1946, at which
time all the accused men were convicted as charged and fined amounts as
high as $50.00 and cost.'
ts.
On October 23rd, 1946, forty strikers from Hearst went to the Driftwood
Lands and Timber Companies (Camp Number 3) in Staunton Township,
Cochrane District, and stopped fifteen men engaged in work in the employ of
38 REPORT OF THE COMMISSIONER OF THE No. 34
this company by the use of threats of personal violence. The strikers took
over possession of the camp's office preventing- the camp clerk from using
the telephone communication with the outside, the line having been cut in
several places. The strikers then invaded the dining room at the camp and
consumed food which had been prepared for the workers. The Police arrested
three of the leaders on charges of Intimidation, based on Section 501 of the
Criminal Code. They were convicted before a Magistrate at Hearst on No-
vember 12th, 1946, and fined amounts in excess of $50.00.
In the Thunder Bay District, fifteen Timber Companies employing over
4,000 employees in bush operations, pulpwood cutting and its products, were
engaged throughout a wide and difficult area having regard to terrain and
transportation facilities. Some of the more isolated regions could onh' be
reached in an emergency by plane. This service was arranged for by an agree-
ment with the Department of Forestry officials.
A total of forty-one officers and men were assigned to strike duty in the
Thunder Bay area on October 17th, 1946. This entailed heavy expense as the
reinforcements had to be drawn from southern sections of the Province at a
time when their services were required on regular detachment duties.
On or about October 15th, 1946, approximately four hundred striking
bushmen congregated in the municipality of Geraldton where meetings were
held in the Finnish Hall daily. The exterior of the hall was decorated with a
large picture of Premier Josef Stalin of Russia.
On October 17th, striking bushmen became very aggressive north of the
village of Hurkett in the vicinity of the Great Lakes Paper Company camps
by erecting on the roadway of the company an improvised gateway, thus
causing all vehicular traffic to stop. Twelve pickets at this barrier would
interrogate the travellers and inspect their baggage before they allowed them
to proceed. Some persons thus treated included visiting citizens from the
United States, 1)ent on a deer hunting expedition in Ontario. ^Members of
the Force investigated the incident and had the barrier removed with a warn-
ing to the erring strikers.
On the night of October 30th, 1946, approximately eighty strikers riding
in trucks arrived at Nowatin River where the Great Lakes Paper Company
had men working on their bush limits. Early the following morning a large
group of pickets entered the Company's mess hall and other buildings on the
property and told the workers that they had only ten minutes to leave the
camp. It was found that Walter Haywood of Winnipeg, a leading union man,
was in charge of the pickets but no evidence was forthcoming from the dis-
turbed workers to warrant any arrests. The workers, on the advice of the
police, returned to the camp when transportation was provided.
Members of the Force avoided taking any action not considered proper
and when in doubt consulted the local Crown attorney for legal opinion. This
unbiased attitude on the part of the police did not pass unnoticed by the union
representatives and the strikers, as comments to this effect were voiced after-
wards to our men.
CRIMINAL INVESTIGATION BRANCH
This Branch has been actively and continuously employed in the many
lines of investigation undertaken by them, including such contrasting subjects
as the investigation of applicants for licenses under the Unwrought Metals
Act, the Private Detective Act, the Administration of Municipal Police
1946 ONTARIO PROVINCIAL POLICE 39
forces, various matters on behalf or in co-operation with other government
departments and all cases of Criminal Investigation including many of the
major crimes occurring through the Province.
Appended hereunder are some of the more important cases which were
investigated during the year :
Murders
In addition to new occurrences reported and investigated, a number of
cases reported in 1945 were continued and disposed of.
Seryeant Hugh B. Price, JFindsor, Autjust 18th, 1945
This was one of three murders which occurred in Windsor during the
month of August, 1945. All three murders were reviewed in the report sub-
mitted for that year by reason of the fact that an officer was detailed from the
Criminal Investigation Branch to assist the Windsor City Police in the in-
vestigation, which, at the time, failed to lead to the murderer.
However, in June, 1946, two similar attempted murders occurred in
Windsor, the victims being Joseph Gelenger and Alexander Voligny, both of
Windsor. Investigation of these later crimes led to the arrest of a young
man named Ronald George Sears, Windsor. All of the circumstances and
evidence indicated that Sears was responsible for these five crimes.
Sears was tried, in the first instance, with the murder of Sergeant Hugh
P). Price, and was convicted and sentenced to be hanged. This conviction was
quashed in the Court of Appeal.
The situation to date is that Sears is still in custody awaiting disposition
of the other murder charges on which he stands indicted, and they have been
traversed to the May Assizes.
Mrs. Audrey Lyons. A]ax, November 10th, 1945
This case was reported in the 1945 Annual Report. Lome C. Harris,
charged with the murder of Mrs. Audrey Lyons, appeared for trial at Whitby
at the March Assizes, 1946, Avas found guiltv and sentenced to be hanged on
^lay 28th, 1946.
The Court of Appeal granted a new trial which took place in September,
1946. at which time Harris was acquitted.
John Dubinsky , South Porcupine, November 23rd, 1945
^larcell Desserres was convicted of this murder at the Cochrane Assizes
in April, 1946. He was sentenced to be hanged on July 9th, 1946.
The Court of Appeal granted a new trial, which commenced in October,
1946. The trial proceeded for several days, when the accused was taken ill.
He was later certified to be unfit to instruct counsel, and is at present under
detention in a mental hospital.
Pussell Gammon, Essex County, December 31st, 1945
Charles Kennedy, charged with this murder, appeared for trial at Sand-
wich in May, 1946, and was found not guilty.
40 REPORT OF THE COMMISSIONER OF THE No. 34
Theresa DeCourcy. Sault Ste. Morie, October 19th, 1945
This brutal murder which was reported in last years Annual Report has
been the subject of continued investigation. Numerous suspects have been
interrogated and every clue followed to its conclusion, but so far sufficient
evidence has not been obtained to place any person on trial.
IV alter A. Laval lee, Sauyeen Indian Reserve
Private Walter A. Lavallee, a soldier who had just returned from overseas
on January 4th, 1946, was shot at the home of his mother-in-law, Mrs. Davis
Besito, on the Saugeen Indian Reserve near Southampton, on fanuarv 6th,
1946.
Lavalee was sitting on a chesterfield in the living room of the house, when
a shot rang out, and he died almost instantly. The bullet had been fired
through a window in the living room.
Investigation disclosed that one Neil Nashkawa, age 23. Saugeen Indian
Reserve, had been seeing ]\Irs. Lavallee, wife of the deceased, during Lavallee's
absence overseas, and Airs. Lavallee admitted that she and Nashkawa had
oeen intimate during that period.
Two .43 calibre Mauser rifle bullets Avere found in Nashkawa's shack,
and a rifle of the same calibre was found against a fence post near the shack.
A pair of goloshes were also found, hidden under a stone. These had been
patched, and were identified as being the property of Nashkawa. They were
identical in size and tread with prints found in the mud outside the house in
which Lavallee had been killed. It was established that the rifle had been
in Nashkawa's possession, and had been loaned to him by the registered owner.
Nashkawa was charged with murder and tried at Walkerton in Alarch,
1946. He was found guilty and sentenced to be hanged on June 5th, 1946,
which sentence was duly carried out.
Mrs. Alary E. Pillsivorth. Brampton , Peel County
On January 13th, 1946, ]\Irs. Mary Ellen Pillsworth, age 29, of Brampton,
died at Toronto General Hospital as a result of head injuries sustained during
the evening of January 12th, at her home in Brampton. There was no sign
of a struggle in the house when the injured woman was found, and so far as
could be ascertained, nothing had been taken from the house.
Elbert C. Pillsworth, husband of the deceased, who operates an electrical
goods store in Brampton, received a telephone call at his store shortly after
10 p.m., on January 12th, 1946. from the local telephone exchange, advising
him that they had a call from his hovtse, but were unable to make out what
the party w^as saying. Pillsworth hurried home to find his wife lying on the
floor, holding the telephone in her hand. She had been brutally beaten about
the head, and died the following day without regaining consciousness.
An intensive investigation was conducted, and a reward of $1,000.00 was
posted, but to date there has been no solution of this crime.
Joseph and John Fitzniaurice . Renfrezr County
On February 1st, 1946, brothers Joseph A. and John E. Fitzmaurice, Ad-
maston Township, Renfrew County, were shot and killed by Thomas Gibbons,
a neighbour. Leslie McNulty was an eyewitness to the shooting.
1946 ONTARIO PROVINCIAL POLICE 41
Thomas Gibbons admitted that he had shot the brothers when they at-
tempted to drive over a road running through his property. Apparently ill-
feeling had existed for some time between Gibbons and the Fitzmaurice
brothers over the right-of-way on this road.
On March 18th, 1946, Gibbons trial commenced and he was found guilty
of murder and sentenced to be hanged on June 11th, 1946.
The Court of appeal reviewed this judgement in May and ordered a new
trial, which commenced on November 4th, 1946. After some deHberation, the
jury found that Gibbons was sane and was fit to stand trial. Counsel for the
accused then advised that one of his most important witnesses, a sister of
the accused, was ill and could not attend court, and the trial was ordered
traversed to the 1947 Spring Assizes.
John Orrangc, S'.ratJu-oy , Middlesex County
Harry Short was arrested at Strathroy, February 10th, 1946, and charged
with the murder of John Orrange on Februay 11th, 1946. It was alleged that
shortly after midnight on Fel^ruary 10th, 1946, the accused had caught John
Orrange in the act of window peeping. Orrange was terribly beaten about
the head and was found dead on the floor of Short's home when police arrived.
The accused appeared at London before Mr. Justice MacKay and Jury and
was found not guilty on March 20th. 1946.
John Dick, Hamilton, H'entivorth County
On March 16th, 1946, a male torso, clothed only in a suit of combination
underwear, was found on the Mountain Scenic Drive near Hamilton. The
arms, legs and head had been sawn off and the stomach partly sawn through.
On March 19th, the torso was identified by John Wall of Beamsville, as the
remains of his brother-in-law, John Dick, age 39, who had been missing from
his boarding house in Hamilton since March 6th. Deceased was a Russian-
Mennonite, employed as a street car conductor with the Hamilton Street
Railway Company.
It was learned that Dick had an appointment with his wife, Evelyn Dick,
on March 6th, the day he disappeared, and on March 19th, Evelyn Dick was
taken into custody and questioned. She immediately denied having any
knowledge of her husband's death. Her premises were searched and a watch
and chain, money changer, street car ticket box, street car tickets and uniform
buttons were found, and all were identified as Ijeing the property of John
Dick, and had been in his possession on the day he disappeared.
Evelyn Grant Dick married John Dick on October 4th, 1945, under the
name of Evelyn White, a name she acquired in 1943 when she gave birth to
the first of three illegitimate children. Evelyn and John Dick had separated
some time prior to his death, owing to domestic trouble.
On March 26th, Evelyn Dick was formally charged with the murder of
her husband, and several days later, William Bohozuk, a friend, was jointly
charged with her on the murder count. Subsequently. Donald and x\lexandra
Maclean, parents of Evelyn Dick, were also charged with the murder of John
Dick. At the preliminary hearing, all were committed for trial, and with the
exception of Alexandra Maclean, who was charged as a material witness and
released on bail.
A further search of Evelyn Dick's home revealed a locked suitcase in the
attic which contained the mummified body of an infant about two weeks old.
Evelyn Dick admitted that it was her last child, born in September, 1945, and
42 REPORT OF THE COMMISSIONER OF THE No. 34
she named William Bohozuk as the father of the child. She and Bohozuk
were charged with the murder of the baby.
The trial of Evelyn Dick for the murder of her husband commenced at
Hamilton on October 7th, 1946. and lasted until October 16th, 1946, when the
jury returned a verdict of "guilty," and she was sentenced to be hanged on
January 7th, 1947, which date was subsequently changed pending an appeal
in this case.
The trial of William Bohozuk and Donald Maclean commenced on Oc-
tober 17th, 1946, and on October 21st, the Special Crown Prosecutor, T. J.
Rigney, K.C.. made a motion to have the jury withdrawn from the case, on
the grounds that all the evidence was not available. The motion was granted
and the trial of Bohozuk and Maclean was postponed until the next sitting
of the Assize Court.
Joan Smith, Miyiaki, District of Kenora
On May 4th, 1946, the body of Joan Smith, age 3, was found about one
hundred yards from her home at Minaki, District of Kenora. The child's
head had been crushed and the body was nude, with the exception of a pyjama
coat.
Joan's parents, Mr. and Mrs. Herbert Smith, Winnipeg, operate a sum-
mer resort at Minaki, and they had been spending the week end there when
the daughter was killed.
The deceased and her baby brother had been placed in bed by their
parents at seven o'clock, and the parents then left to visit a nearby family,
leaving a hired girl with the two children. About eleven o'clock the same
night, the parents returned and discovered that their daughter was missing
from her bedroom. A search party discovered the child's battered body about
an hour later. The hired girl stated that she had retired early in the evening,
and had heard no disturbance.
An exhaustive investigation was conducted, and although several persons
were under suspicion, no solution has been arrived at to date. A reward of
$1,000.00 has been posted by the Province of Ontario, with the customary
provisions.
Mrs. Leslie Hill, jMuiicey Indian Reserve, Middlesex County
Leslie Hill was arrested at Frome in Elgin County on 2vlay 13th, 1946,
and charged under Section 263 Criminal Code for the murder of his wife,
Kathlene Hill. The accused was committed for trial on May 21st, 1946, and
came up for trial at London on Friday, September 25th, 1946, before Mr.
Justice A. M. LeBel and jury, and on October 2nd, 1946, was found "not
guilty" of Murder but "guilty" of ^lanslaughter. The accused was sentenced
to serve ten years in Kingston Penitentiary.
Mrs. Ora Han-ii</an , Fruitland, JVentiuorth County
On Ma}' 22nd, 1946, the body of Mrs. Ora Ellen Hannigan, 69 year old
widow and operator of a fruit market and service station near Fruitland, was
found in the bedroom of her home. The victim lay on the floor, with her hands
])ound in front of her, and a workman's handkerchief tied tightly around her
neck. Death had been caused by strangulation. The premises had been
ransacked, apparently in search of money, and three empty purses were found
on a bed.
1946 ONTARIO PROVINCIAL POLICE 43
To date, no one has been apprehended in connection with this murder.
The Province of Ontario has posted a reward of $1,000.00, with the usual
provisions for information leading to arrest in this case.
Daniel Tessier, Dalfon Mills, District of Algoma
On June 4th, 1946, Daniel Tessier, age 34, left his home to travel to his
trapping cabin at Jackpine River, about 8 or 9 miles away. He intended to
return in a few hours time to resume work at the mill where he was employed.
According to his wife's statement Tessier said before he left that if he failed
to return the Provincial Pohce were to be notified. He took a .303 calibre
rifle with him on this trip.
Tessier had been threatened the day preceding his disappearance by
certain parties who beHeved that Tessier had given information to the Police,
which had resulted in searches being made and charges laid under the Game
and Fisheries Act. There had also been bitter feeling over trapping areas.
On June 12th, 1946, Tessier's body was found floating on Shakwamka
Lake, about nine miles from his home. Death had been caused by a rifle
bullet passing through his head.
Several persons were under suspicion in connection with this murder, but
to date no charges have been laid.
Nora Sliaivaiida, South Bay, Manitoulin Ishuid
On Sunday, June 10th, 1946, at 9:15 a.m., Gore Bay Detachment received
information regarding Mrs. Nora Shawanda who had been admitted to the
Indian Hospital, Manitowaning, suffering from a severe beating, allegedly
committed by her husband. On June 11th, 1946, Nora Shawanda died while
being operated on under anesthetic for injuries received, subsequently, George
Shawanda was charged with murder. On August 9th, 1946, he appeared
before Magistrate W. F. Woodliffe at the village of Wekwemikong, Mani-
toulin Island, and was committed for trial on a charge of manslaughter.
On October 8th, 1946. George Shawanda appeared l^efore Mr. Justice W.
F. Schroder, Fall Assizes, Gore Bay, and after pleading not guilty through
his Counsel, Mr. E. C. Facer, the grand jury brought in a verdict of no bill
on the murder charge but a true bill on the manslaughter charge.
The charge of manslaughter was proceeded with and after three of the
crown witnesses had testified, it was learned that the accused wished to plead
guilty to a charge of assault occasioning actual bodily harm. Section 295
Criminal Code. This was accepted by the crown. George Shawanda was
sentenced to the Ontario Reformatory, Guelph, to a term of eighteen months
definite and three months indefinite.
Theresa and Patricia Laurie, Ajax, Ontario County
On June 16th, the bodies of Theresa Laurie and her four year old daughter,
Patricia, of Ajax, were found on the highway near Ajax. The skulls of both
had been battered into a pulp, apparently by a large stone which was found
nearby.
Theresa Laurie had been going out with one George Bilton, recently
released from Guelph Reformatory, where he had served a year's sentence for
non-support of his wife and two children. He had visited Mrs. Laurie regu-
larly, at her home when her husband had been absent at work. A search for
44 REPORT OF THE COMMISSIONER OF THE No. 34
Bilton was made, and he was found sleeping in a car on a parking lot in
Oshawa.
While being questioned by Police, Bilton submitted a statement written
in pencil, in which he confessed having killed Mrs. Laurie and her daughter.
The motive given by Bilton for the double slaying was that Mrs. Laurie
wanted to go away w^ith Bilton and live with him, and when he refused, she
threatened to tell Police about a child born to her at Cobourg in March, 1946,
naming Bilton as the father.
On September 24th, 1946, Bilton was convicted of the Murder of Mrs.
Laurie and was sentenced to be hanged on December 10th. An appeal was
made, but this was dismissed by unanimous decision of the Appeal Court,
and Bilton was hanged at Ontario County Jail, Whitby, December 10th, 1946.
Louis ISato, JVi'Ucmd County
Louis Nato, age 55, an Italian living at Thorold, was robbed and assaulted
early on June 17th, 1946. Nato related that he and Mrs. George Popovich,
who had worked for him before her marriage in 1945, had arranged to go out
on the night of June 16th, 1946. Mrs. Popovich told Nato that her husband
would be working that night.
Nato and Elizabeth Popovich drove to a sideroad and parked there, and
Nato was kissing the woman when the front door of the car was opened, and
George Popovich appeared and threw a rope around Nato's neck. Nato's
hands and feet were tied and he was robbed of approximately $185.00, keys
and a wallet containing a cheque. The woman drove the car for a short dis-
tance, and while it was still moving, George Popovich threw Nato out of
the car.
After regaining consciousness, Nato walked to Thorold and telephoned
the Police.
On June 19th, 1946, Nato lapsed into a state of coma. He w-as transferred
to the St. Catharines General Hospital, where he died several days later.
George and Elizabeth Popovich were charged with murder and on September
12th, they were sentenced to be hanged.
An appeal was made in November but the Appeal Court unanimously
upheld the conviction and dismissed the appeal. The sentence of the court
was duly carried out on December 5th, 1946.
John nnd Lillian Br'ooke, Sondzvich Jl est, Essex County
On July 7th, 1946, John Brooke (Negro) was released from Kingston
Penitentiary after serving a three year term. He returned to his home in the
Township of Sandwich West where there was immediate and continuous
domestic difficulties.
On the night of August 9th, 1946, he shot his wife Lillian with a shotgun
and immediately turned the gun on himself. Both died instantaneously.
Richard Morgan, Kingston, Frontenar County
On July 8th, 1946, our Kingston Detachment investigated a complaint
lodged by one Gerald Smith of Kingston Township respecting one Richard
Morgan.
The officers arrived at the Smith residence at approximately 12:45 a.m.,
1946 ONTARIO PROVINCIAL POLICE 45
to be met by Smith running out of the house exclaiming, "I have fired a shot
and I haven't heard any movement since," during which time he was frantic
ally motioning toward a truck parked directly in front of the Smith house.
Upon examination of this truck it was found that a man, later identified as
one Richard Morgan, age 27 years, of Kingston, Ontario, was sitting in a
slumped position behind the steering wheel of the vehicle. Closer examination
revealed that Morgan was dead and a small hole was noticed in his shirt over
the left shoulder. Coroner, Doctor M. J. Morrison of Kingston was called
and after viewing the remains ordered the body removed. An autopsy was
performed by Doctor W. D. Hay, a pathologist at Kingston, and a small bullet
was removed from the body. Doctor Hay stated that the bullet, one of .22
calibre, had entered the left shoulder and travelled through to the right auricle
of the heart. Death was due to this wound and internal bleeding.
Smith was immediately arrested and held on a nominal charge of vag-
rancy. An inspector of the Criminal Investigation Branch immediately pro-
ceeded to Kingston and assumed charge of the investigation.
On July 13th, 1946, on the instructions of Attorney T. J. Rignay. K.C.,
charges of murder and manslaughter, Sections 263 and 268 of the Criminal
Code, were preferred against Smith.
On July 23rd, 1946, Gerald Smith appeared before Magistrate J. B. Garven
at Kingston for a preliminary hearing at which time the charge of murder was
laid over until the Fall Assizes.
On October 28th, 1946, the Grand Jury upon reviewing the evidence as
offered in this case returned a true bill on the manslaughter count, Section
268 C. C. The trial proceeded before His Lordship Justice Barlow and lasted
for two days. At the conclusion of the case and after the jury had deliberated
for one and one half hours, they returned a verdict that Smith was guilty of
manslaughter, and he was sentenced to serve three years in Kingston Pen-
itentiary.
Hcfiry Rondeau. Peche Island, Essex County
An unidentified body was found on Peche Island in the Detroit River
near Windsor on July 28th. 1946. The man's skull and right jaw had been
fractured. The body was subsequently identified as being that of Henry
Rondeau, a resident of Detroit, ^lichigan.
An intensive investigation was conducted in Detroit and Windsor, Init
to date no one has been apprehended in connection with this murder. The
Province of Ontario has posted a reward of one thousand dollars for informa-
tion leading to the arrest in this case.
Mary Jane and ^lary RUzabeth Lama. Sto'tnont County
On August 16th, 1946, Mary Jane Lama and her daughter, Mary Elizabeth
Lama, were stabbed to death in their home in Cornwall Township near Corn-
wall, Ontario. Evidence indicated that Mrs. Lama's husband. William Earl
Lama, had committed the double murder, and a warrant for his arrest was
sworn out. The accused went into hiding, and was not arrested until October
26th, 1946, by the Cornwall Township Police. Lama came to trial on the
charge of murdering his wife, and was acquitted. The second charge was
traversed to the next Assizes.
/. Eldon Meredith, Middlesex County
Lloyd Nicholas and Joseph French were arrested August 24th, 1946, at
46 REPORT OF THE COMMISSIONER OF THE No. 34
Delhi, in possession of a loaded automatic pistol and a stolen car. Subsequent
investigations led to charges under Section 263 Criminal Code, for the murder
of one J. Eldon Meredith, who was found shot to death on the Muncey Indian
Reserve. The accused men were committed for trial on September 9th, 1946.
They came before Mr. Justice H. Barlow and jury on January 21st, 1947.
Joseph French was discharged because of insufficient evidence and Lloyd
Nicholas found guilty of Manslaughter and sentenced to serve two years less
one day in the Ontario Reformatory.
Gerald Diisharni, Shnrhot Lake, Frontenac County
On October 11th, 1946, when Gerald Dusharm, age 6, of Sharbot Lake,
Ontario, failed to return home from school at his usual time his parents became
alarmed and a search party was organized. The search was confined to the
village of Sharljot Lake and its immediate vicinity. At 7:30 p.m., October
11th, 1946, the body of Gerald Dusharm was found floating face down in what
is known as Briggs' Creek, three quarters of a mile from Sharbot Lake.
Coroner Doctor W. Whytock of Sharbot Lake in carrying out an exam-
ination of the body, revealed that the back part of the skull was actually
pulverized along with numerous lacerations and bruises to the face and arms.
There appeared to be no doubt that some l)lunt instrument had lieen used in
this brutal assault.
Investigation revealed that Gerald Dusharm had left school at 2 :45 p.m.
on the date in question and had met up with one Ronald York, age 11. of
Sharbot Lake. When last seen together, these boys had been playing near
a cliff, adjacent to Briggs' Creek. York was seen to emerge from this area
alone. When first questioned, the boy stoutly denied any knowledge of Gerald
Dusharm. Nevertheless, Ronald York was taken into custody and removed
to Kingston Detachment offices where he was again questioned.
At this time, Ronald York admitted to the investigating officers that he
had met young Dusharm about 3:00 p.m., October 11th, and that they had
adjourned to the vicinity of Briggs' Creek to play at which time a fight had
started between them. Young York calmly admitted that he had struck the
deceased over the head with a stone knocking him down on the floor of the
C.N.R. bridge. At this point the deceased was bleeding profusely from the
right side of his head. York then deliberately bent over the deceased and
smashed his head time and time again, against the ties of the bridge. When
no further movement was noticed on the part of the deceased, Ronald York
then threw the body off the bridge into the creek, then calmly returned to the
village to play with other children bragging about the man he had just killed.
Ronald York was confined to the Psychopathic Ward of Kingston General
Hospital under the supervision of the Children's Aid Society where he was
examined by Doctor C. H. McCuaig, a Psychiatrist from the Ontario Hospital
at Kingston. Doctor McCuaig's findings were that Ronald York was a men-
ace to other children and although not grossly defective, was a borderline
case, definitely knowing right from wrong. Crown Attorney T. J. Rigney,
K.C., instructed that York be charged with Occasioning Actual Bodily Harm,
Section 295 Criminal Code, and on December 10th, 1946, he appeared before
Magistrate J. L. Lloyd in Sharbot Lake, was convicted and sentenced to the
Ontario Boys Training School for an indefinite period.
Mr. and Mrs. Francis Steip. JFtarton, Grey County
On October 29th, 1946, the dead bodies of Francis Steip, age 74, and his
wife, Sarah, age 65, were found in the wood shed of their home at Wiarton.
1946 ONTARIO PROVINCIAL POLICE 47
From investigation it would appear that Mrs. Steip, who had been a
patient in Ontario hospitals on three occasions, was a very considerable burden
and had asked on a number of occasions to be put out of the way, and, event-
ually her husband had shot her and then turned the rifle on himself. This
theory was borne out by the position of the bodies and the rifle.
Mrs. Rita Taylor-, Saniia. Lanibton County
On November 30th, 1946, Airs. Rita Taylor, R.R. 3, Sarnia, was brutally
beaten in lier home, and died a few hours later in Sarnia General Hospital.
Her husband was arrested and charged with murder. This case is still
proceeding.
Mrs. G. Jewitt, Leamington, Essex County
On December 6th, 1946, William Jewitt, age 17, of the town of Leaming-
ton, attacked his mother, Mrs. G. Jewitt, in their home, and severely beat her
about the head with a claw hammer, which caused her death. He later went
to a neighbour and informed the police of what he had done. The crown
attorney instructed that a charge of murder be laid against Jewitt and instruc-
tions were issued to have him examined by a psychiatrist.
This case is unfinished.
Marion Rusnak, St. Catharines, Lincoln County
Marion Rusnak, age 9, of St. Catharines, was reported missing by her
parents on December 23rd, 1946. The girl had left her home in the afternoon
of December 23rd, to return some tins to a next-door neighbour, and to buy
a bottle of milk at a nearby grocery store. The child returned the tins to the
neighbour, Mrs. Lapiere, purchased the milk and returned to Mrs. Lapiere's
home to pick up a Christmas present for her baby brother, a small white metal
drum, which was wrapped in red and white tissue paper. The girl left Mrs.
Lapiere's home, but failed to return to her own home.
Hundreds of citizens of St. Catharines joined in a search of the city and
surrounding areas for some trace of the missing girl. Wrapping paper found
on the Canadian Canners property, near the Rusnak home was identified by
Mrs. Lapiere as the paper she had put around the drum that was given to
Marion just prior to her disappearance.
On December 31st, 1946, the manager of the Canadian Canners plant
reported to police that Sidney G. Chambers, watchman and furnaceman at
the plant, had attempted to commit suicide in his room in the plant dormitory
by turning on a gas stove in his room, and by cutting his wrists. He was
removed to St. Catharines General Hospital, and later charged with attempted
suicide.
While being questioned by police, Chambers admitted that he had taken
the girl to his room on the day of her disappearance, killed her and disposed
of her body in the furnace where he was employed.
This case is still proceeding.
Donald Hastings, Blenheim, County of Kent
Donald Hastings, a married man living at Rondeau. Kent County was
stabbed with a butcher knife outside the Blenheim Hotel, Blenheim, Ontario,
48 REPORT OF THE COMMISSIONER OF THE No. 34
on December 24th, 1946, causing wounds from which he died.
Investigation showed there had been an altercation between Hastings
and one Leo Duquette, age 28, inside the hotel where Duquette was alleged
to have stabbed Hastings. Duquette was arrested and a charge of Murder
has been preferred against him.
This case is still proceeding.
Attempted Alurde: of John Carey. Brant County
On Jul}' 21st, 1946, an investigation was conducted by our Brantford
Detachment into the vicious attack and stabbing of John Carey by William
Holder as a result of an argument between the two men. Holder was com-
mitted for trial and subsequently appeared for trial before Mr. Justice Keiler
MacKay and jury. To try and justify his actions, Holder stated that he had
been attacked by Carey and that he, (Holder) had acted in self defence.
Holder was found guilty of the offence charged and was sentenced to life
imprisonment. This sentence to life imprisonment can well be understood
when one is acquainted with the long criminal record of serious crimes against
Holder.
Holder was recently released from Kingston Penitentiary after serving
a term of ten years on a charge of attempted murder of a taxi driver near
Brantford in 1933. He escaped to the U.S.A. Twice he was arrested in the
United States and twice he escaped as he was being returned to the border
for deportation to Canada. Finally in 1936, he was arrested in the U.S.A. and
returned to Brantford and on March 11th, 1937, was sentenced to ten years
imprisonment. At the time of his arrest in the U.S.A. and his return to
Canada for trial, he was alleged to be totally blind and his blindness was
attributed to syphilis by doctors, with no chance of recovery of his sight.
However, no chances were taken by the police officers and he was handcuffed
when moved from place to place. The wisdom of this precaution was later
proven when with his recent release from Kingston, he smashed his white
cane over his knee and walked away from the prison with normal eyesight.
In 1925, Holder attempted to shoot Provincial Constable B. Milligan, (now
Corporal Milligan) who was stationed in Brantford at that time, as he was
attempting to apprehend him on a charge of armed robbery.
Manslaughter
Ronald Parradine, Ontario County
Beverly Brown, 12 years of age, was indicted on a charge of manslaughter
in connection with the shooting on December 27th, 1945, of Ronald Parradine,
age 5 years. Brown was found unfit to instruct counsel, and the court ordered
accused to be held in custody at the Ontario Hospital, Orillia.
Airs. Ida Burmide, Parry Sound District
On October 20th, 1945, Mrs. Ida Burnside was fatally shot by a member
of an armed posse who was searching for escaped prisoners from the local gaol.
Roy Land, together with Chief Constable Doolittle, of Parry Sound,
were charged with manslaughter in connection with this matter, but were
acquitted by a jury at an Assizes Court.
1946 ONTARIO PROVINCIAL POLICE 49
Motor Mcinslaufjliter
M. R. Stinchc'jvibe, Kent County
Irrei^ardless of the publicity and warnings issued to the public concerning
the combination of drinking and driving, this type of auto accident does not
appear to decrease. Residents of Kent County once again had this warning
brought home to them. On January 7th, 1946, a bride and groom, Mr. and
Mrs. M. R. Stinchcombe with three friends, left the scene of their wedding,
Thamesville, Ontario, and drove via Number 2 Highway west to Louisville,
where rounding a curve at high speed the car went out of control, struck a
tree and rolled over several times causing the death of two, Mrs. Ann Simp-
son, age 27, and Carl Burke, age 34, and serious injuries to others. Police
investigation revealed that reckless driving on a curve was the cause of the
fatalities. M. R. Stinchcombe, the driver of the car, was charged with motor
manslaughter. Section 268 of the Criminal Code and was committed for trial.
On February 12th, 1946. in Supreme Court before the Honourable Mr. Justice
Keiler AlacKay, the Jury brought in a verdict of not guilty of manslaughter
against the accused, Stinchcombe, but guilty of dangerous driving and he
was sentenced to four months in the Ontario Reformatory.
J /I e lard Roy, Markstay
On March 25th, 1946, a report was received of a serious car accident on
Number 17 Highway three miles west of Markstay. Investigation disclosed
that while A. Demore and J. St. Michel, both of Hanmer, were attempting to
change a left rear tire on a truck, parked on the extreme right hand side of
the highway, they were struck by a car travelling- in the opposite direction.
This car failed to stop and both Demore and St. Michel received serious injury,
and St. Michel died following his admission to hospital.
On March 29th, 1946, Adelard Roy of Markstay, owner and driver of the
death car was arrested and charged with motor manslaughter. He appeared
before Magistrate W. F. Woodliffe and was committed for trial.
On October 7th, 1946, Roy appeared at the Fall Assizes, Sudbury, before
Mr. Justice J. L. Wilson, the charge being reduced from manslaughter to
dangerous driving. Section 285(6) of the Criminal Code. He received a term
of six months definite and three months indefinite in the Ontario Reformatory.
Death of A. A. AI cDonald, Alexandria Municipality
On Octol)er 17th, 1946. one Alexander Angus McDonald of Alexandria
Municipality was reported as missing from his home since October 7th. On
No\ember 2nd, 1946, his body was found in an outhouse on the property of
Joseph Benoit of Alexandria. Considerable investigation was made into this
death as many ugly rumors were present that McDonald had been murdered.
As a result, an inquest was held in order to clear up the air. The coroners jury
brought in a verdict that death was due to suffocation or asphyxiation in the
pit in an outhouse on the property of Joseph Benoit, Victoria Street, Alex-
andria. Witnesses who gave evidence of hearing shouts or cries for help on
the night that McDonald was reported missing were severely criticized by
the jury.
ARMED ROBBERY
Bank of Montreal, Blenheim Branch, Kent County
On x^ugust 23rd, 1945, two armed men held up the officers of this bank
50 REPORT OF THE COMMISSIONER OF THE No. 34
and stole $4,300.00 in currency.
Gerald Blackbvirn and Gail Hastings were convicted and sentenced to
seven years each in the Penitentiary.
Royal Bank of Canada, Leaside Branch, York County
This bank was robbed of some $12,000.00 on September 26th, 1945. On
May 1st, 1946, three men, Walter Mishko. John Liddle, and Victor Wazney
were arrested and subsequently convicted on a charge of armed robbery. Each
were sentenced to ten years in the Penitentiary.
Canadian Bank of Commerce, Selkirk Branch, Haldimand County
On May 31st, 1946, the Selkirk Branch of the Canadian Bank of Com-
merce was held up and robbed of $7,895.00 and $150.00 in bonds by three
armed men who escaped in an auto bearing Quebec license plates.
Following investigations one of the men concerned, William Riddle
(alias Liddle) was arrested at Orillia, and admitted being implicated in this
robbery. When his place of abode was searched the following firearms were
seized : one .22 calibre rifle ; one shotgun ; one .38 calibre Colt revolver, fully
loaded ; and one Luger .38 calibre pistol, fully loaded. On his person when
arrested and searched were found a .32 calibre Savage Automatic pistol, fully
loaded ; nineteen new 2 dollar bills with serial numbers in sequence, and five
dollars and forty cents in dimes, identified as stolen from the Bank of
Commerce.
As he was wanted in [Montreal for a prior holdup, Riddle \vas returned
to that city for trial where he was sentenced to a term of fifteen years in the
Penitentiary. He has not been returned to this Province for trial and his two
confederates have not so far been apprehended.
Bank of Toronto, Carlisle Branch. Wentivorth County
On Ma}- 23rd, 1946, three armed men entered the Bank of Toronto, Car-
lisle Branch, in the township of East Flamboro, County of Wentworth, held
up the bank officials and escaped with approximately $750.00 in cash.
As a result of investigations by officers from Number 3 District Head-
quarters, Hamilton, three men, Victor Brain, Harry Aronas and ]\Ianuel Brit-
stone were arrested and charged with robbery with violence.
They appeared for trial in County Judges Criminal Court, Hamilton,
when Brain was sentenced to seven years in Kingston Penitentiary.
The charges against Britstone and Aronas were dismissed due to lack
of sufficient identification.
Royal Bank of Canada, Embruni Branch, Russell Countv
On April 28th, 1946. the Royal Bank of Canada, Embrum, Russell
County, was held up by two armed, masked men who* broke into the residence
of the Bank Manager, forcing him and his family into the bank. As the bank
safe had a time lock, the bandits were unable to obtain any money. A very
lengthy investigation was carried out but no satisfactory results obtained.
On August 16th, 1946, the same bank was held up and one James Mallette,
taxi driver of Hvdl, Quebec, was accidentally shot by Joseph A. Clouties,
1946 ONTARIO PROVINCIAL POLICE 51
JJank Manager, and seriously wounded. Constables from uur various detach-
ments of the District, and constables of the Ottawa City, Nepean township,
and R.C.M.P. Police Departments were thrown in and a thorough search of
all the countryside in the vicinity of Russell was made. Through the excellent
efforts of all concerned one Thomas Ritchie was arrested. Ritchie was
charged with armed rol)bery, aggravated assault and being in possession of an
offensive weapon, to which he pleaded guilty. On August 26th, 1946, he
appeared in Magistrates Court, L'Original for sentence, and was sentenced
to twenty years on the charge of armed robbery, two years on the charge of
aggravated assault, and five years for possession of an offensive weapon. The
sentences of twenty years and five years are to run consecutively and the two
years to run concurrent.
Provincial Branch of Canada, Tecumseh Branch. Essex County
A splendid example of public and police co-operation was witnessed in
the swnft apprehension of five persons subsequently charg'ed with the mar-
ginally noted crime. On June 13th, 1946. in the town of Tecumseh. at 2:45
p.m., four employees and five customers of the Provincial Bank of Canada
were suddenly confronted by three armed and masked bandits. From threats
of violence, all were forced to lie down on the floor while the sum of $13,071.79
was stolen. The robbery was completed in five minutes and the bandits
escaped in a stolen car which they had left at the rear of the bank with the
motor running. The alarm attracted the attention of the local citizens, a few
giving chase in their cars. One car was successful in following the bandit
car. at 80 m.p.m.. to its destination, Peltier Harbour on the Detroit River.
Another car stopped enroute to advise the police the direction taken. In Pel-
tier Ilarl)our the car attracted attention by its speed and it was observed
stopping at the river's edge where three men jumped out, met a woman, then
altogether left in a boat in the general direction of Peche Island, which is a
])art of Sandwich ICast township. The l)cindit car was seen driven away by a
fifth party. Provincial, Riverside and Windsor Police converged on the area,
but the parties involved had disappeared. The Detroit River Patrol, U.S.
Coast Guards and a scout plane searched up and do\vn the river. Provincial
and Windsor Police commandeered a boat, went to Peche Island and arrested
Mrs. Helen Rainone. Clifford Renaud. John Zero and Donald Lowry. The
four suspected persons were found near the boat which had left the mainland.
All were well known characters. The clothing worn by the bandits and the
money stolen from the bank was found Imried in the sand of the beach near
the scene of the arrests.
On July 17th. 1946. the three charged with the robbery were committed
for trial by Magistrate J. A. Hanrahan. Following a true bill, Lowry. Zero
and Renaud were arraigned in Supreme Court before the Honourable Justice
Dalton Wells, on September 23rd, 1946, and pleaded not guilty. The evidence
of circumstances and continuity which was unbroken from the time of the
robber}- and their arrest proved conclusive and the jury brought in a verdict
of guilty. On October 3rd, 1946, all three accused were sentenced to ten years
each in Kingston Penitentiary.
Bank of Nova Scotia, iMarkhain Branch, York County
On the afternoon of January 19th, 1946, at approximately 4:30, while
Provincial Constable J. W. Sheffield was patrolling number 8 Highway in
Wentworth County, he overtook a car carrying two young men. Their actions
aroused his suspicion and he followed them for about a half mile, then stopped
and (piestioned them. Still suspicious, he searched their car finding a leather
52 REPORT OF THE COMMISSIONER OF THE No. 34
bag containing a considerable amount of silver money, a large amount of
bonds, and two loaded revolvers behind the rear seat. The two youths were
taken to District Headquarters at Hamilton, where they gave their names as
Murray Lawrence, age 17, and Robert Lance, age 16, of Toronto. They were
questioned and gave statements to the effect that on the previous night they
had broken into the Bank of Nova Scotia, Markham, smashed their way into
the vault and stole the money, bonds, jewellery and the two revolvers. A
check was made and it was found that the money and bonds totalled $50,760.54.
Later in the evening all the loot and the two prisoners were turned over to
the York County Police, who were in charge of the investigation.
hnperiftl Bank, Bolton Branch, Peel County
In the early morning of January 27th, 1946, Leonard Gott, age 19, son
of Cecil Gott, prominent farmer of Peel County, residing at Bolton, was re-
turning to his home when he noticed an auto parked in front of the Imperial
Bank Building, Bolton, with two men in it. He observed their movements
and saw them enter the bank and carry some heavy object in the side door.
Gott turned in an alarm to the effect that he had seen two men in the
bank attempting to open the vault with an acetylene orch.
A number of citizens, amongst them being Gott's father, armed themselves
with firearms and surrounded the bank. When the bandits became aware
they were discovered, they escaped through a cellar window and ran around
the bank followed by Leonard Gott.
When they came into view, Cecil Gott, Leonard's father, thinking all
three were bandits fired a shot which struck his son who fell, badly wounded.
His death took place in the Brampton Hospital, February 10th, 1946,
fourteen days after he had been shot.
The search for the bandits was continued, and John Reynar and Stanley
Thompson were later arrested. Both were charged with Breaking and Enter-
ing the Imperial Bank at Bolton with intent to commit an Indictable offence.
The}' were found guilty and sentenced as follows : Reynar, six months deter-
minate and twelve months indeterminate in the Ontario Reformatory ; Thomp-
son, age 17, was placed on suspended sentence for two years.
Imperial Bank, loniliill Branch, JFelland County
On February Uth, 1946, it was discovered that a theft of $1,600.00 had
taken place at the Fonthill branch of the Imperial Bank. Suspicion centered
on Wilfred Cooke, caretaker at the Bank, who was missing.
Cooke was arrested on April 30th, 1946, and charged with the theft.
$200.00 of the stolen money was recovered.
At his trial he pleaded guilty and was sentenced to six months definite
and twelve months indeterminate in the Ontario Reformatory.
/Irnied Robbery, Carlton County
On July 13th, 1946, Donald Laprade. a taxi driver, was held up and
robbed by a passenger whom he was driving. The driver was tied up and
placed in the back seat, the bandit taking over the driving of the car. A
second bandit was picked up near Ottawa.
When the cab stopped at Brittania. the driver was able to get out of the
1946 ONTARIO PROVINCIAL POLICE 53
car. In attempting to put him back into the car, the attention of the l)andits
was attracted ; they abandoned the auto and took to the bush.
Combined poHce operation resulted in the arrest of Henry Ceretti and
Nicholas Minnille of Ottawa. Both men were charged with armed robbery
and kidnapping.
Ceretti pleaded guilty before the magistrate and was sentenced to five
years in Kingston Penitentiary.
Minnille elected trial before a High Court. He was arraigned in the
vSupreme Court at Ottawa and was found guilty. He was sentenced to ten
years with ten lashes on the armed robbery charge and seven years on the
kidnapping charge.
Robbery with Violence, Thunder Bay Diiirict
On May 19th, 1946. Geraldton Detachment received a complaint to the
effect that one Nestor Maki had been beaten up and robbed of some twenty-
four dollars the night previous.
Investigating this case the constable arrested one Raymond O'Hare who
was arraigned before Magistrate C. D. LeMay at the Magistrate's Court at
Fort William on a count of robbery with violence, Section 446a, of the Crim-
inal Code. The accused was found guilty on June 3rd, 1946, and was sentenced
to a term of four years in the Stoney Mountain Penitentiary, Manitoba.
Robbery ivhile Armed, lliimder Bay District
At about 5:00 a.m., Sunday, June 23rd, 1946, District Headquarters at
Port Arthur received a telephone call to the effect that at about 2 :30 on the
same date, Frank Dixon, a taxi driver, had his throat slashed by a passenger
when his destination was reached some six miles west of Fort William, in
Neebing township. The driver fought off his assailant and managed to drive
back to McKellar Hospital, Fort William, where some twenty stitches were
required to close the wound.
Later investigation resulted in one Steve Oktaba being apprehended
early the same afternoon. On the instructions of Mr. P. V. Ibbetson, Crown
Attorney, a charge of wounding, under Section 273 of the Criminal Code was
laid. On July 4th, 1946, Oktaba was arraigned before Magistrate C. D. LeMay
in the Magistrate's Court at Fort W'illiam on a charge of wounding. The
accused elected summary trial and entered a plea of guilty.
He was sentenced to serve ten years in the Stoney Mountain Penitentiary,
Manitoba.
Robbery ivith Violence, Amherstburg, Essex County
On January 14th, 1946. while Miss Jane Bailey, cashier for the Mara
P)read Company, Amherstburg. was on her way from the bakery to the bank
with cash for deposit, she was knocked down and robbed of a receptacle con-
taining approximately $1,600.00. The thief made his escape in an auto which
had previously been stolen in Windsor. This auto was found abandoned in
a bush outside the town shortly after the robbery.
On January 29th, 1946, Irvin Green and Robert Anderson were arrested
at Toronto in possession of an auto stolen from Windsor. Green implicated
.\nderson in the robbery of the bakery cashier. When Anderson was ques-
54 REPORT OF THE COMMISSIONER OF THE No. 34
tioned he admitted taking- part in same but would not implicate anyone else.
Robert Anderson was charged with robl^ery with violence under Section
446a of the Criminal Code. He was found guilty and was sentenced to five
years in the Penitentiary with five strokes of the strap.
Armed Robbery on No. 2 Highwax, Essex County
On May 10th, 1946, Paul B. Croly, a salesman retvirning to his home in
Chatham via Number 2 Highway, picked up three young men who hailed him
for a ride. After proceeding about a mile, one of the passengers in the rear
seat pointed a gun at Croly, ordered him to stop and then forcibly ejected him
from his automobile.
The three young men drove away and after covering the greater part of
Eastern Ontario were arrested in possession of the stolen car (and contents,
value $550.00) at Gananocjue.
They were identified as Arthur lUirker, Harry Huot and Theodore Valen-
tine, all of Windsor, and were charged with robbery with violence under
Section 446a of the Criminal Code.
At their appearnce before the magistrate they pleaded guilty and were
sentenced as follows: Harry Hviot, four years in Kingston Penitentiary;
Arthur Barker, four years in Kingston Penitentiar}- ; Theodore \'alentine. two
years less a da}- determinate, and eighteen months indeterminate in Ontario
Reformatory.
Armed Robbery , Bob-Io Excursion (lon.pany , Essex County
On July 7th, 1946, six employees of the Bob-Lo Excursion Company on
Bob-Lo Island were held up by five armed and masked men. Two held the
employees under guard while the remaining three forced open the safe and
obtained $11,910.00 in Canadian and American currency.
They then cut all communications to the mainland and made their escape
in two row l)oats.
This crime to date remains unsolved.
Armed Robbery. Riverside, Essex County
On November 26th. 1946, one of the boldest and most daring robberies
in the annals of Essex County took place at the Edgewater Inn. operated by
Mrs. Rcrtha Thomas iii the town of Riverside.
On closing- the Inn, ^Irs. Thomas retired to her apartment and to bed.
Shortly after 5 :00 a.m. she was awakened by a man entering her bedroom
by means of a ladder at the Avindow. The man was masked, armed, and was
followed l^y two other men similarly equipped and disguised.
^Irs. Thomas was dragged from her bed. beaten, kicked, threatened, and
forced to open the safe from which was stolen approximately $4,000.00 in
Canadian and American currency.
After the robbery it was found the cr)nimunication system had been
rendered useless.
Suspicion rested upon one Angus Robinson, who was a well known local
character. His place of abode was searched. The search revealed a quantity
1946 ONTARIO PROVINCIAL POLICE 55
of silver and other items similar to what had been stolen. These were seized
and a lookout kept for Robinson who was later arrested with Mike Kosowen
and John Owad.
All were charoed with armed robbery under Section 446a of the Criminal
Code.
At their appearance before the magistrate in magistrate's court at Wind-
sor, they elected trial before a High Court and were remanded, pending the
appearance of the principal witness. Mrs. Thomas, still suffering from the ill
treatment received at the time of the robbery.
Jrmed Robbery. Middlesex County
On August 20th. 1946, Floyd Mills and Lawrence McEachern were ar-
rested on charges of having held up and robbed a taxi driver in the township
of Westminster.
Thev appeared before the magistrate at the magistrate's court at London
on August 23rd. 1946. where they were found guilty and sentenced to fifteen
months determinate and three months indeterminate in the Ontario
Reformatory.
Armed Robbery, Oxford County
On September 17th, 1946, Ross Dennis Whitney w^as arrested on three
charges of armed robbery and three charges of theft of autos in Oxford and
Middlesex counties.
Whitney was arraigned before the magistrate at the magistrate's court
at Woodstock on October 2nd, 1946. He was found guilty and sentenced to
terms totalling eleven years in Kingston Penitentiary.
Armed Robbery, ff'aterloo County
On January 19th. 1946. Rudolph Motkalik reported to the Kitchener
detachment that he had been robbed by three armed men.
Joseph Kemple and Frank Helynchak were arrested and they implicated
Fred" ^lorgan in the robbery. Morgan was arrested at Los Angeles, returned
to Canada and all three charged with the offence.
Thev appeared before the magistrate at the magistrate's court in God-
erich on'july 17th. 1946. when Morgan and Kemple were sentenced to three
years each in Kingston Penitentiary. Helynchak. who had no previous record
was placed on su.-pended sentence.
Armed Robbery, Sandivich East, Essex County
On July 13th. 1946, Wilfred Adams of 2440 Norman Road, Sandwich East
township, who manages a poolroom in the city of Windsor, took a taxi to his
home. He had at the time $7,907.00 on his person.
As the taxi drove into his driveway it was followed by another auto con-
taining two armed and masked men, who held up Adams robbed him of the
cash (carried in a money belt) and escaped.
Although it is almost certain who committed this robbery, sufficient
evidence has not been obtained to warrant an arrest.
56 REPORT OF THE COMMISSIONER OF THE No. 34
Assault, Being Jimed with Intent to Rob, Lincoln County
On March 20th, 1946, Mrs. Gladys Darling while driving her auto to
Niagara Falls, picked up a soldier near Burlington Beach to give him a lift.
When near Homer, he held her up with a revolver and forced her to drive
down a sideroad. Mrs. Darling, seeing a service station, drove to the station
and screamed, attracting the attention of the attendants. The soldier, who
was later identified as Private Joseph Kramer, jumped out of the auto and ran.
The alarm was given and in a short time the accused was arrested at a ceme-
tery on Number 8 Highway. When searched he was found to have a .38
calibre revolver on his person.
A charge of assault while armed, with intent to rob was laid. At Kramer's
trial, he was found guilty and sentenced to two years in the Penitentiary.
Robbery ivhile Armed, lialdimand County
On May 27th, 1946. two men. one armed with an automatic pistol, held
up Clarke's Grocery Store. Caledonia, escaping with about $60.00 from the
cash register.
It was learned that the men wanted for the robbery were travelling in
a Plymouth car accompanied by another man and two girls. One man. Frank
Owen, and the two girls. Marie Flell and Anne Zimba were arrested by the
Hamilton City Police, and the two other men concerned were later arrested
at Belleville. They were Alexander Carnegie and Lionel Zinger.
All three men appeared before magistrate's court at Cayuga on June 18th,
1946, and were sentenced as follows: Alexander Carnegie, charged armed
robbery, eighteen months determinate and twelve months indeterminate; Li-
onel Zinger. two years less one day determinate and two years less one day
indeterminate in the Ontario Reformatory.
Robbery ivith J lolence, Frontenac County
On January 25th, 1946. while Robert ^IcQuaker of Xapanee was driving
his auto from Kingston to Napanee. he gave a ride to two hitch hiking soldiers.
At a point about six miles from Kingston. McQuaker was assaulted by the
soldiers who robbed him of his money. $64.00. and forcibly evicted him from
his car and drove away with the auto.
As a result of a road block, the soldiers were arrested at Napanee still
driving the McQuaker auto. They were identified as Gerald Morpaw and
Eugene Tinbrell. both stationed at military camps in Kingston.
They were arraigned in magistrate's court at Kingston and charged with
robbery with violence.
Gerald Morpaw was sentenced to two years in Kingston Penitentiary
and Eugene Tinbrell was sentenced to fifteen months in the Ontario Reform-
atory.
Armed Robbery, Bradford, Simcoe County
On September 7th, 1946, two armed men walked into the ^lodel Bakery,
Bradford, held up the cashier, robbed the cash register of $150.00 and escaped
on foot. The occupants of the bakery at the time of the holdup could give
little or no description of the robbers, not even to the direction they went
after the robbery. All enquiries so far have proved negative, and the occur-
1946 ONTARIO PROVINCIAL POLICE 57
rence is still under active investigation.
Armed Robbery, Parry Sound District
On October 24th. 1946, Samuel Devlin, Indian Agent of Parry Sound,
while enroute to the Gibson Indian Reservation near Bala to pay treaty money
to the Indians, was held up and robbed of $1,200.00 by two armed and masked
men.
An old trick was employed in this case. An obstruction was placed across
the roadway and when Mr. Devlin stopped his auto to remove same, two
armed and masked men stepped out of the bush along the roadside, held him
up. opened the car door and removed the brief case containing the money.
The agent was then ordered to walk down the road and "keep on going."
It is believed that this robbery was carried out by Indians who knew Mr.
Devlin's movements. l)ut so far sufficient evidence has not been adduced to
warrant an arrest.
Theft of Auto zvhile Aimed, Huron County
On April 27th. 1946. one Albert George Hodges of Windsor was found
in possession of a stolen car near Exeter. Also in the car was a loaded revolver.
Hodges was arrested and charged with being in possession of an unregistered
weapon under Section 118 of the Criminal Code, also possession of a weapon
dangerous to the public peace. Section 115 of the Criminal Code.
Hodges appeared before County Judge T. M. Costello and Jury at the
General Sessions at Goderich on June 3rd, 1946, and w^as found guilty on both
charges. He was sentenced to four years in Kingston Penitentiary on each
charge, to run concurrent. Hodges had a previous record, having just been
released pre\'ioas to the above charges.
Breaki)ig, Entering and Theft, Stormont County
On September 11th, 1946, the Grand River Golf and Country Club at
Bridgeport was broken into and goods to the value of $345. taken therefrom.
As a result, one John A. Mitchell was apprehended in Toronto on other
charges, and later charged with this offence.
Mitchell appeared before Magistrate Thomas Elmore at Cornwall on
December 6th, 1946, on several charges from outside points. He was sentenced
to two years in Kingston Penitentiary to run concurrent with any other
charges.
Breaking, Entering and 'Theft, Grey County
On April 3rd, 1946, the post office at Mildmay was broken into and the
property stolen was later recovered at Walkerton. Two men, namely Peter
Stasiuk and Norman Stolarski of Toronto were arrested in a stolen auto near
Hanover and charged.
On April 30th, 1946, Stasiuk appeared before Magistrate O. McClevis at
the magistrate's court at Walkerton on a charge of car theft from Hanover,
and was sentenced to three years in Kingston Penitentiary, consecutive with
a seven year sentence received at Cobourg, and tw^o years concurrent. On the
breaking, entering and theft of ^^lildmay post office, he was sentenced to
twelve vears in Kino-ston Penitentiarv.
58 REPORT OF THE COMMISSIONER OF THE No. 34
On May 1st, 1946, Norman Stolarski was arraigned before Judge G. W.
Morley at Owen Sound, charged with car theft at Hanover, and was sentenced
to two years in Kingston Penitentiary to run concurrent. On June 7th. 1946,
he appeared before Magistrate O. McClevis at Walkerton on the breaking,
entering and theft charge at ]\lildmay post office, and was sentenced to five
years in Kingston Penitentiary, consecutive with other sentences of four
years.
Breaking, Enteriiu; and Theft, Essex County
Because of a most unusual circumstance in the in\estigation of the mar-
ginally noted crime which resulted in the application of a rarely used Section
of the Criminal Code, it is considered an interesting subject to mention. On
January 15th, 1946, the post office at Cottam was discovered broken into and
a safe containing $75.00 and papers was found missing. The safe was later
recovered minus the money which could be identified by serial numbers. The
"modus operandi" was suggestive of the work of a criminal by the name of
Wilfred Laramie. When arrested at his home, Laramie was in possession
of five bills amounting to $14.00, four of which could be identified. Laramie
was taken to District Headquarters at Windsor for interrogation. At his
request, for comparison, the money was laid on a desk before Laramie, who
suddenly snatched it up and shoved it in his mouth. A struggle ensued but
he defended himself long enough to swallow the money. He was taken to
the hospital, but in accordance with his rights refused any medical assistance
to recover it. The evidence was thus destroyed. There were two charges
laid, one of breaking and entering, and the other under Section 180d of
the Criminal Code, that he did unlawfully and wilfully attempt to defeat
the course of justice by unlawfully destroying evidence of the commission of
an offence. On February 21st, Laramie elected trial by a hig-her court and
was committed thereto by Magistrate J. A. Hanrahan. On June 14th, having
so elected, Laramie was arraigned before County Judge J. A. Gordon at
Windsor and was found guilty and sentenced to six months in the Ontario
Reformatory.
Break'nKj, Entering/ and Theft, Durham County
On April 14tli. 1946, Gordon Brown of 1988 Dufferin Street, Toronto,
reported to Bowmanville Detachment that his summer cottage situated in
Cartwright township had been entered some time since March 1st, and a
quantity of clothing and furniture stolen.
On May 7th, 1946, while the constable was carrying out some routine
investigations, he had cause to interview one Fred Kendrick of Cartwright
township at \\hich time the investigating officer noted that Kendrick was
wearing clothing similar to that reported stolen by Brown from his summer
cottage. After a lengthy investigation, Kendrick was arrested, and charged
in connection with Brown's complaint respecting his summer cottage. Kend-
rick's residence was searched and a quantity of stolen goods recovered. Fur-
ther investigation revealed that some of the goods recovered had been stolen
from a summer cottage in Cartwright township, also from a church in Toronto.
On ]May 14tli, Fred Kendrick appeared before Magistrate E. A. Gee at
Bowmanville and was convicted under Section 458 Criminal Code, and was
sentenced to a term of five years in Kingston Penitentiary. Further charges
as preferred against Kendrick by the Toronto City Police were also disposed
of on that date.
1946 ONTARIO PROVINCIAL POLICE 59
B>-eakiii(i , Kiiteruig and Theft, Frovtenac County
On October 28th, 1946, a hunter's lodge at Plevna was broken into and
se\en hundred dollars in American currency, one .22 calibre rifle and one
flashlight were stolen. The cottage was owned by Charles S. Teasdale. The
Kingston detachment immediately commenced an investigation which resulted
in one William Desabrais and his wife, Jean Desabrais, alleged to be from
Ottawa, being apprehended. Both parties stated they were hitch hiking from
Ottawa to Pembroke. When searched, the money and the flashlight were
found, which Desabrais and his wife stated they had found along the roadside.
In view of this evidence. Corporal Ramsbottom preferred a charge of house-
breaking under Section 458 of the Criminal Code against each individual.
On Noveml)er 5th, 1946, William and Jean Desabrais were arraigned
before Magistrate J. L. Lloyd at Sliarbot Lake and were convicted as charged.
William Desabrais, an old offender, was sentenced to a term of three years in
Kingston Penitentiar3\ Jean Desabrais, who had no previous record, was
given suspended sentence.
Breaking, Enti'i'mg and Theft, Ehjin County
On May 11th, 1946, Trueman McCarey, and his two sons, Kenneth and
Robert, were arrested at St. Thomas on numerous charges of house and shop
breaking in Klgin County.
The\- appeared before the magistrate at the magistrate's court at St.
Thomas on June 6th, where they were found guilty and sentenced as follows:
Trueman McCare}-, four years in the Penitentiary ; Robert McCarey, two
years less one day in ( )ntario Reformator\- ; Kenneth McCarey, two years
suspended sentence.
BREAK. IvNTRY AND THEFT FROM CREAMERIES IN
CENTRAL ONTARIO
Hagersville . Haldi/nand County
During the night cjf June 21st, 1946, the creamery at Hagersville was
broken into and l)utter and cash stolen.
.\s a result of combined police investigation, David Tucker and Louis
Christopher were arrested and charged with this robbery. On W^ednesday,
September 18, 1946, they appeared in County Court at Cayuga and David
Tucker was sentenced to four months i't the county jail and Louis Christopher
was given suspended sentence.
Brussels, Huron County
( )n January 16th, 1946, the creamery at Brussels was entered by burglars
but owing to a Inirglar alarm sounding, they were disturbed before anything
could be stolen.
An enquiry resulted in the arrest of Ross Kriks and Joseph Prokopsky
of Toronto who were charged with breaking and entering with intent to rob.
They were tried at the county judge's criminal court, Goderich. on May 12th,
1946, and were sentenced to two years each in Kingston Penitentiary.
Monkton, Perth County
On Noveml^er 11th, 1946, the creamerv owned bv Stacev Bros, at Monk-
60 REPORT OF THE COMMISSIONER OF THE No. 34
ton was entered and the safe blown. Fortunately no valuables were obtained.
Later the same day Tony DiCessa and Harold Backner were arrested
and charged with offences of safebreaking, also with breaking into the Can-
adian Bank of Commerce at Monkton
This case has not been completed.
KInivale, Simcoe County
On the night of July 1st. 1946. an attempt was made to force the safe at
the Elmvale Creamery without success. The thieves evidently were disturbed
and in their getaway abandoned an auto which it was found, had been stolen
in Hamilton.
'Tottenham, Duffer in County
On the night of September 15th, 1946, an attempt was made to force the
vault of the Tottenham Creamery by three men who were disturbed during
their operation.
They escaped in a station wagon which had been stolen earlier the same
night.
ARSON
Arson and TIr'fr. District of Muskoka
On April 22nd, 1946, a report was received at the Huntsville detachment
that an untenanted house owned ])y George Lovegrove in the township of
Brunei had been destroyed by fire and that it was suspected the house had
been stripped of household effects prior to being burned.
On investigation, considerable household goods and chattels were fovmd
in the bush nearby. Further enquiries resulted in the arrest of two men,
Archie Baumhour and Alex Wood of Brunei township, who admitted having
set the house on fire to cover the theft of the household effects.
On May 9th, 1946, Baumhour and Wood were arraigned before the magis-
trate at Bracebridge. They pleaded guilty to arson and were sentenced to
three years in Kingston Penitentiary.
The apprehension of these two men solved a number of reports of break-
ing, entering and theft from summer residences in the ^luskoka and Parry
Sound Districts.
Wood was later convicted on six charges and Baumhour four charges of
breaking, entering and theft and sentenced to an additional three years in the
Penitentiary to run concurrent with the sentence for arson.
Arson and Theft. District of Muskoka
On June 10th, 1946, the summer home of Miss Margaret Waller of New-
ton, Mass., situated on Lake Rosseau near Windermere. Muskoka was
destroyed by fire. The building and contents were valued at $7,500.00. At
first, it was thought defective wiring or a grass fire was the cause of the fire.
Suspicion however, became centered around Claude Rosyski, who with
his wife, were employed as hired help in the district. Royski was arrested
and charged with breaking into the Waller residence and stealing a radio,
blankets, linen, comforters and other articles.
1946 ONTARIO PROVINCIAL POLICE 61
On July 4th, 1946, Royski was arraigned before the magistrate at Brace-
bridge. He was convicted and sentenced to three years in the Kingston
Penitentiary.
In this case Royski followed the "modus operandi of Baumhour and
Wood by destroying a home by fire in an attempt to cover up theft therefrom.
Fires in Reside liuil Hotels, Muskoka District
Two private residential hotels in the District of Muskoka were destroyed
l)y fire during the year.
On April 15th, 1946, the Riverview Hotel at Baysville was completely
destroyed. This was a three story building with capacity for one hundred
guests.
On July 11th, 1946 fire broke out at the Canadian Keswick Hotel. Fern-
dale, Muskoka, and despite the efforts of volunteer and Port Carling fire
brigades, the building and contents was completely destroyed.
" No loss of life was suffered in either occurrence and no evidence was
obtained to indicate that the fires were other than accidental.
Bancroft Jail Break, HasTvigs County
On October 2nd. 1946. a Provincial Constable escorted Kenneth Holland.
Royce Seymour and Charles Airhardt from the County Gaol at Belleville to
the' Bancroft lock-up in which village these three men were to appear the
following morning on numerous charges of breaking, entering and theft.
Sometime during the night, the three men broke jail by forcing the lock
on their cell door. Holland and Seymour immediately set upon the jail guard,
an elderly man, one Frank Askey of Bancroft, after l^rutally assaulting him,
robbed him of the sum of sixty-four dollars and fled. Airhardt, at this point,
chose to remain in his cell where he was found the following morning.
A most efficient road block was organized which resulted in Holland
and Seymour being apprehended at 10:45 p.m.. on October 3rd, in the village
of Apsley. They were accordingly charged with jail break and robbery with
violence. On October 10th. the accused appeared before Magistrate J. L.
Lloyd at Belleville and were convicted on all counts. Kenneth Holland on
the charge of robbery with violence was sentenced to eight years in Kingston
Penitentiary and a concurrent sentence of two years on the charge of Jail
Break. Royce Seymour, on the charge of robbery with violence was sen-
tenced to serve three years in Kingston Penitentiary and a concurrent sentence
of two years on the charge of jail break. Charles Airhardt pleaded guilty to
the charge of jail break and was allowed his freedom on two years suspended
sentence. The crown offered no evidence on the charge of robbery with
violence against Airhardt and the charge was dismissed.
Forgery, Hampton , Durham County
On November 8th, 1946. the Bowmanville detachment received a com-
plaint from George Kerslake of Hampton to the effect that four cheques for
the total amount of $160.00 had been marked to the debit of his account at a
local bank in Bowmanville. Kerslake disclaimed any knowledge of issuing
cheques for these amounts. Upon examination of the cheques in question, it
was quite evident that they were the result of clever forgery. All cheques had
62 REPORT OF THE COMMISSIONER OF THE No. 34
been cashed by Bowmanville merchants, and had been tendred by an unknown
man and woman.
The descriptions as furnished by the various merchants who had cashed
these cheques talhed with the descriptions of an alleged married couple named
Ernest J. Young and Mary Young whom Kerslake previously had in his
employ. This couple had terminated their services with Kerslake on the date
he was notified of the cheques being marked to his debit.
Ernest J. Young and Mar}- Young were arraigned before Magistrate E.
A. Gee at the magistrate's court at Bowmanville and were accordingly con-
victed of all charges preferred against them under Section 467 of the Criminal
Code. Mary Young was given two years suspended sentence on each of the
three charges, such sentences to run concurrent. Ernest J. Young was
sentenced to two years in Kingston Penitentiary on each charge, to run con-
current.
Ilighschool Pri.uipal, Coe Hill, hiasiings County
On May 20th. 1946, the Provincial Constable of Bancroft detachment
received a complaint to the effect that one Ralph Turner, Highschool Prin-
cipal at Coe Hill was practicing indecent acts on young boys. As a result of
this complaint a most diligent and thorough investigation was undertaken
which resulted in the apprehension of Ralph Turner at Toronto on July 11th,
1946. Four charges of gross indecency, and one charge of indecent assault
on a male were preferred against Turner.
On August 2nd, 1946, Turner appeared before Magistrate T. Y. Wills at
Belleville and was committed for trial on these charges. On December 11th,
1946, Turner appeared before the General Sessions of the Peace for the county
of Hastings presided over b}" His Honour Judge W. Lane of Picton. Con-
victions were registered on the four charges of gross indecency, and the fol-
lowing sentences handed down; (1st charge) 9 months definite and 9 months
indeterminate in the Ontario Reformatory; (2nd charge) 18 months definite
and 9 months indeterminate ; (3rd charge ) two years in Kingston Penitentiary ;
(4th charge) 9 months definite and 9 months indeterminate — such sentences
to be served in the Ontario Reformatory at Guelph. .\11 Reformatory sen-
tences to run concurrent.
ANTI-GAMBLING BRANCH
Officers of this Branch were actively engaged in the suppression of dis-
orderly houses, and convictions were registered against persons for keeping
common bawdy, betting and gaming houses in the following municipalities :
Blandford Township; Brampton; Brantford; Cardinal; Chatham; Dundas ;
Dysart Township ; Eastview ; East York Township ; Etobicoke Township ;
Forest Hill Village ; Fort Erie ; Gait ; Grantham Township ; Hamilton ; London
Township; Newmarket; Ottawa; Paris; St. Catharines; Prescott ; Preston;
Sarnia ; Simcoe ; Stamford Township ; vStratford ; Thorold ; Toronto Township
and York Township.
A number of complaints and information have l^een received regarding
the operation of disorderly houses at various locations in the Province. These
were given prompt attention. The greater number of prosecutions instituted
were the result of a systematic check ])eing made by the officers of this Branch.
During the year, officers of this Branch worked in various municipalities
throughout the Province where we are not primarily responsible for law
1946 ONTARIO PROVINCIAL POLICE 63
enforcement, and have received the utmost co-operation from the Chief Con-
stables and officers under their command.
On |une 7th, 1946, a Search Order was executed at the residence of Albert
Simpson (Shimkopsky) of 183 Montclair Ave., Forest Hill Village. In an
upstairs bedroom (which was rented by Irving Denovitch, 63 Borden Street,
Toronto, for $100. per month), bets were being recorded by Denovitch and
Percy Sniderman of 223 Palmerston Avenue, Toronto. In this room were
four unlisted telephones and among the papers seized was a complete record
of bets recorded and the "p^y off" sheet for Thursday, June 6th, which was as
follows : $7,730.00 was found to have been wagered on 454 race horses and of
that amount, $4,900.35 was shown as being returned to winning persons who
had placed bets. The proprietor of the betting establishment stood to profit
by the sum of $2,829.65 for one complete day's operation. Irving Denovitch
and Percy Sniderman were jointly charged with keeping a common betting
house, Section 229 of the Criminal code, also recording and registering bets on
race horses, under Section 235d of the Criminal Code, and the trial proceeded
bv way of indictment. On the evidence submitted to the court, the charges
against Percy Sniderman were dismissed. Irving Denovitch was found guilty
on both charges and fined $300. or 90 days in gaol on the first count. $200 or
60 days in gaol on the second count, fines to run consecutive, gaol terms con-
current. The crown served notice of appeal on Irving Denovitch in connection
with the sentences imposed as being inadequate. Mr. Justice Laidlaw pre-
sided over the court of appeal and sentenced Irving Denovitch to a term of
three months in gaol in addition to the fine of $500.00.
In practically all prosecutions in connection with the charge keeping a
common betting house, evidence was obtained showing that the telephone had
been used as the medium for transmitting the bets from the premises where
they were taken to some other location for the purpose of being recorded.
In this connection, 35 telephones were seized, removed from the premises and
returned to the Bell Telephone Company of Canada at the conclusion of the
trial.
Officers of this Branch were on duty during the period May 18th, 1946,
to August 23rd, 1946, at the following race tracks operating in the Province,
for the purpose of suppressing bookmaking, in co-operation with the various
Municipal Police Forces :
Spring Meeting, Toronto.
Ontario Jockey Clul) May 18th to May 25th, 1946.
Spring Aleeting, Toronto,
Long Branch Jockey Chib Limited June 5th to June 12th, 1946.
Spring Meeting, Toronto.
Metropolitan Racing Association of Canada Limited ..June 15th to June 23rd, 1946.
First Summer Meeting, Hamilton,
Hamihon Jockey Clul) Limited June 24th to July 1st, 1946.
Second Summer Meeting, Hamil-
ton. .August 3rd to August 10th,
Hamilton Jockey Club Limited 1946
Fort Erie, Ontario,
Ascot Turf Club Limited July 20th to August 1st, 1946.
Stamford Park, Stamford Town-
Belleville Driving and Athletic Association Limited Uiip. Aug. 17th to Aug. 23rd, 1946.
Four slot machines, five electric "free play" slot machines, four pin ball
machines and four combination pin ball and race horse machines were seized.
64
REPORT OF THE COMMISSIONER OF THE
No. 34
a total of 17. These machines were found to have been used as gaming
devices and were ordered by the presiding Magistrate to be confiscated and
destro3'ed, and the monies found therein to be forfeited to the Crown for the
public uses of Canada. Twenty machines were destroyed, three of which
were carried forward from 1945.
Four hundred and forty-seven investigations were carried out during the
year. Seventy-five orders to search and fourteen Search Warrants were
execvited. Seven summonses were served, and eighty-four persons were ar-
rested without warrant. Fines to the amount of eleven thousand and eighty
dollars were imposed as sentences and collected. Eight persons were sentenced
to gaol for a total period of seventeen months and twenty-eight days.
The smu of two hundred and twenty-eight dollars and seventeen cents
recovered from confiscated gaming devices ; two hundred and twelve dollars
and thirty-seven cents seized in gaming houses ; and nine hundred and eighteen
dollars and thirty-four cents seized in betting houses which was ordered for-
feited to the Crown was turned over to the convicting Magistrates to be for-
warded to the office of the Receiver General of Canada.
ANTI-GAMBLING BRANCH
Classified Return of Prosecutions, Convictions. Dismissals, Withdrawals, etc.
From January 1st to December 31st. 1946
OFFENCE
Prose-
cutions
Convic-
tions
Dismis-
sals
With-
draw-
als
Fines
Imposed
and
Collected
Gaol
Term
Served
Common Bawdy House..
Common Betting House
Common Gaming House
Recording & Registering Bets
Permitting Premises to be used
for purposes of a Disorderly
house
Engage in Business of Occupation
of Betting or Wagering
Found Ins
Inmates. Bawdv House
TOTALS.
2
50
29
2
2
107
3
200
1
45
25
1
2
100
2
178
18
$6,400.00
2,575.00
300.00
200.00
100.00
1,475.00
30.00
$11,080.00
3 mos.
7 mos.
& 28 days
2 mos.
3 mos.
15 mos.
28 days
THE LIQUOR CONTROL ACT
There Vv-ere 4,773 prosecutions by officers of the Ontario Provincial
Police Force under the provisions of the Liquor Control Act of Ontario, for
the period Januarv 1st to December 31st, 1946, as follows: Convictions, 4,509;
Dismissals, 110; Withdrawals. 154; Total, 4.773.
The fines imposed under the provisions of the Liquor Control Act of
Ontario amount to approximately $91,793.00. the total amount l^eing com-
prised as follows :
1946
ONTARIO PROVINCIAL POLICE
65
OFFENCES
Having in Illegal Place
Unlawful Purchase
Selling or Keeping for Sale
Unlawful Possession
Drinking in Public Place
Supplying to Minors
Illegal Use of Permits
Having or Consuming in Hotels
Intoxicated in Public Place
Permitting Drunkeness in Private
Residence
Violations of Regulations 13, 15, 62a, b
64b, 125, 126, 132, and 173
Found-Ins
Minors Applying for Permits
Aliscellaneous
TOTALS
Prosecu-
tions
1,269
20
94
430
422
39
187
8
1,4^)1
21
502
96
18
206
Convic-
tions
4,773
1,217
19
61
396
412
24
156
7
1,432
19
485
90
17
174
Dis-
missals
4,509
30
17
9
3
6
4
1
16
9
1
13
With-
drawals
22
1
16
25
7
9
27
13
5
1
19
Fines
$17,446.50
1,095.00
355.00
26,265.00
4,549.00
130.00
9,385.00
80.00
16,177.50
590.00
8,420.00
1,060.00
250.00
5,990.00
110
154 I $91,793.00
CONFISCATED LIQUOR
The following- amounts of spirits, wine and beer were seized and confis-
cated by the presiding- magistrates and ttirned over to the Liquor Control
Board: spirits, 600 gallons; beer, 6,100 gallons; wine 1.575 gallons.
CONFISCATED AUTOMOBILES
Under the provisions contained in the Liquor Control Act, the following
automobiles were seized and conficated by the presiding magistrates, brought
to Headquarters, and were sold by auction to the highest bidder. I may add
that these cars were being used illegally by bootleggers for transporting
liquor :
CONFISCATED CARS
No. 502 — Terraplane Sedan
No. 503 — DeSoto Sedan
No. 504— Chevrolet Sedan
No. 505— Dodge Sedan
No. 506 — Dodge Sedan
No. 507 — Terraplane Sedan .
No. 508— Cadillac Coupe
No. 509— Maple Leaf 2 Ton Truck
No. 510 — Plymouth Coupe
Total
Value
$333.90
Returned to Owner
668.88
628.84
333.87
545.92
300.00
400.00
481.54
$3,692.95
REVENUE DERIVED FROM ENFORCEMENT OF THE LIQUOR
CONTROL ACT, ONTARIO
1946 1945
Fines Collected $ 91,793.00 $ 88,306.50
Approximate value of Liquor Seized 25,000.00 28,000.00
Approximate value of Autos Confiscated 3,692.95 3,028.71
Totals $120,485.95 $119,335.21
66 REPORT OF THE COMMISSIONER OF THE No. 34
Dhqiialification of Premises
During the year, 150 certificates, restoring disqualified premises to private
residences under Section 43 (2) of the Liquor Control Act were granted.
Twenty-five applications for removal of the disqualification were refused.
Dtsi(fnatio?i of Rooms as Private Residences in Hotels, Clubs and Tourist Ca?nps
Approximately three hundred applications were received in 1946 from
hotel proprietors, tourist camp operators and club managers for the privilege
of having rooms designated in their premises as private living quarters. Only
twelve of these applicants were refused this permission.
Liquor Permits Received for Cancellation
During the past year, there were 1,991 permits for liquor and reports on
same received at this Branch from officers of the various Districts, and in
^ach case where there were sufficient grounds to support a recommendation
for the cancellation or a Prohibitory Board's Order being issued, the necessary
action was taken and reports forwarded to the TJquor Control Board recom-
mending cancellation.
Highway Traffic Act
Statistical information as supplied by the Registrar of ]\Iotor Vehicles,
with comparative statements of the number of X'ehicle Permits and Operators'
Licnses issued for the years 1946 and 1945 respectively:
1946 1945
Passenger Cars 585,604 555,460
Commercials 117,217 98,339
Two Purpose 1,303 1,279
Trailers , 61,114 53,004
Motorcycles 6,982 5.745
Dealers 1,045 708
Operator's 683,105 637,020
Operator's (Motorcj-cles) 845
Chauffeur's "....'. 403,495 334,832
Instruction Permits 109,130 81,928
In Transit Markers 11,707 2,998
Transfers 145,463 102,401
A conference was held at General Headquarters, Toronto December 9th
to 11th, 1946, attended by Headquarters Staff, District Inspectors, Patrol
Sergeants, and representatives of the Department of Highways, to discuss
problems in connection with the enforcement of the Highway Traffic Act, and
to devise additional ways and means of reducing the continuously mounting
toll of accidents arising from the operp^-ion of motor vehicles on the highways.
That there is greater need than ever for intensified action, on the part of
Police Departments, is proven by our records for the current year compared
with the corresponding period for 1945. You will note a very considerable
increase both in the number of accidents and fatalities that has been recorded.
1946
ONTARIO PROVINCIAL POLICE
67
Month
Total
Fatal
Number
Killed
Number
Injured
430
404
414
466
551
601
797
820
704
670
849
781
25
15
21
25
21
27
32
31
40
49
31
28
27
18
24
32
22
27
37
42
47
57
43
33
266
227
252
April
340
May
401
496
Tulv
644
652
September
608
477
November
603
400
Totals
7,487
357
409
5,369
Totals 1945
5,117
289
326
3,659
2,370
68
83
1,710
Traific Safety
In May and June 1940, the International Association of Chiefs of Police
in conjunction with the Chief Constables' Association of Canada, again spon-
sored a continent wide Safety Programme in an endeavor to combat the
seriotis rise in traffic accidents and fatalities.
The programme was known as the Police Traffic Safety Check, and its
primary purposes were conveyed in the three-fold slogan selected to be used
during the campaign to wit : "Check your car" — "Check your Driving"^ —
"Check Accidents."
The purpose of the Campaign was educational, and not punitive, and the
primary object was to encourage motorists to drive safely, observe the traffic
laws, and maintain their vehicles in a safe and roadworthy condition.
Leaflets were given to every motorist stopped by police for any purpose ;
to school children in rural schools; to garage and service station workers.
Posters were distributed to: garage and service stations, general stores,
pulilic offices, cottntv Iniildings. police and fire stations, post offices, bus
terminals, etc.
Patrol Officers also visited all rural schools on their detail, and had a few
minutes talk with the pupils on the relationship of the Traffic Check to safety
measures on the Highways. By this means, the Campaign penetrated into
practically all homes in the Province, as a resvtlt many persons who would
not otherwise have known of the efforts being made have become "Safety
Conscious."
68
REPORT OF THE COMMISSIONER OF THE
Xu. 34
PROSECUTIONS FOR TRAFFIC OFFENCES UNDER H.T.A. AND
CRIMINAL CODE
For the period January 1st to December 31st, 1946
Offences
Prosecu-
tions
Convic-
tions
Dis-
missals
With-
drawals
Speeding
Defective Lights
Careless Driving
Crowding Front Seats
No Permit (Drivers, Operators, etc.)...
Driving Under Sixteen
Failing to Stop at Through Street
Improper Left Turn
Overloading
Defective Brakes
Fail to Remain at Accident
Parking on Highway : ,
Rules of Road — Breach of
Failure to Notify Purchase
Failure to Notify Change of Address...
Bicycles, Lights, Bells, etc.
Public Commercial Vehicle Act
Miscellaneous t
Chauffeurs — No License ._
Owner's Name Not on Vehicle
Reflector
Failure to Report Accident .
Failure to Produce Permit or License
Markers Dirtv
763
744
1,052
1,014
2,430
1,987
24
23
860
818
4
4
277
269
66
62
765
748
296
281
n
61
223
190
728
687
60
52
24
20
2
1
58
50
464
425
27
25
23
23
42
39
54
45
121
114
27
25
11
27
303
1
21
5
4
11
7
10
17
25
4
2
"3
22
1
Totals 1 8,467
7,707
487
11
142
21
3
6
6
16
16
4
2
1
5
17
1
3
2
2
1
273
CRIMINAL CODE— SECTION 285
Offences Concerning Motor Vehicles
Offences
Prosecu-
tions
Convic-
tions
Dis-
missals
With-
drawals
Driving While Intoxicated
Hit and Run Drivers
Taking Car Without Owner's Consent
Reckless or Dangerous Driving
Driving While License Suspended
Leaving Scene of Accident
Totals
385
77
105
604
28
41
322
62
92
427
22
34
53
8
7
124
3
6
1.240
959
201
10
7
6
53
3
1
STATISTICAL RETURNS
CLASSIFIED RETURN OF PROSECUTIONS, CONVICTIONS, DISMISSALS
AND WITHDRAWALS
JANUARY 1st TO DECEMBER 31st, 1946
Prosecu-
tions
Convic-
tions
Dis-
missals
With-
drawals
Criminal Code and Other Statiitt
Highwa}' Traffic Act
Liquor Control Act
Wartime Regulations
Totals
1945 Totals
7. 4 00
8.467
4,773
50
5,677
7,707
4,509
25
20,696
16,205
17,918
1,077
487
110
652
273
154
25
1,674
1,104
14,195
1.219 !
791
1946
ONTARIO PROVINCIAL POLICE
69
RETURN OF CRIMINAL PROSECUTIONS
Offence
Convic-
tions
Dis-
missals
With-
drawals
Total
Abduction
Abortion
Affray
Arson
Assault — Aggravated
Assault — Bodily Harm
Assault — Common
Assault — Female
Assault — Indecent
Assault — Intent to Rob
Assault — Police Officer
Attempted Arson
Attempted Breaking and Entering
Attempted Buggery
Attempted Carnal Knowledge...
Attempted Fraud
Attempted Rape
Attempted Suicide
Attempted Theft
Bigamy
Breaking and Entering
Breaking and Entering and Theft
Breaking Gaol
Bribery ■_
Buggery
Burglary
Carnal Knowledge
Concealment of Birth...
Conspiracy
Corrupting Children
Conversion
Criminal Negligence
Cruelty to Animals
Damage to Property
Damage — Wilful
Disorderly Conduct
Disturbance
Explosives — Illegal Possession
Escaping Custody
False Pretences
Forgery
Fraud
GAMBLING
Gaming House — Keeper
Gaming House — Found In
Recording and Registering Bets
Keeper Conmion Betting House
Disorderly House
Betting or Wagering
Gaml)ling Devices — Conducting
Gross Indecency ,
Highgrading
Housebreaking
Incest
Incorrigible (Juvenile Delinquency)..
Indecent Acts
Impersonating Police Officer
Intimidation
Kidnapping
Manslaughter
Mihtary. Wearing Medals, Uniforms.
Miscellaneous Offences
Mischief .'
Murder
Non Support, Children, Wife
Obstructing Police
7
1
40
10
13
219
306
23
80
8
10
1
1
3
3
1
2
20
21
3
109
84
3
1
1
26
9
1
1
5
1
6
27
75
75
196
15
4
20
139
49
11
36
125
1
45
2
4
1
10
11
246
18
22
35
5
20
3
13
6
145
58
6
34
7>2>
3
76
71
14
24
3
4
1
3
1
9
5
1
4
3
2
11
7
20
14
24
12
2
1
5
7
1
2
3
1
50
2
3
7
15
2
15
4
6
9
3
5
36
60
4
18
3
13
8
20
23
3
1
1
2
1
12
2
2
2
1
1
5
5
2
13
3
9
1
43
10
21
331
437
41
122
11
15
2
4
4
3
1
4
32
29
3
121
93
4
2
1
38
17
2
10
8
3
17
Z1
108
97
240
15
5
20
174
54
13
42
134
2
50
5
5
1
10
12.
308
22
27
44
5
32
3
29
9
165
67
14
56
39
70
REPORT OF THE COMMISSIONER OF THE
No. 34
RETURN OF CRIMINAL PROSECUTIONS— Continued
Offence
Convic-
tions
Dis-
missals
With-
drawals
Total
Perjurj-
Rape
Robber}' and Extortion
Roliber}- — Armed
Robbery — With Violence
Seduction
Shooting with Intent ,
Shopbreaking
Stolen Property — In Possession of
Stolen Property — Receiving or Retaining
Theft '
Theft of Poultry
Theft of Automobiles
TRAFFIC OFFENCES
Driving While Intoxicated
Hit and Run Drivers
Taking Car Without Owner's Consent...
Reckless or Dangerous Driving
Driving Whilst License Suspended
Leaving Scene of Accident
Trespassing
Threatening
Uttering
Vagrancy
Weapons — Offensive
Weapons — Carrying Concealed
Wounding with Intent
3
3
12
23
30
2
2
186
7
72
997
25
46
322
62
92
427
22
34
9
12
18
375
12>
9
16
1
19
23
191
7
53
8
7
124
3
6
1
5
1
60
7
10
19
2
11
71
3
7
10
7
6
53
3
1
2
3
1
128
2
Totals I 5.388
1.036
629
5
14
13
24
40
5
3
224
9
106
1,259
35
61
385
n
105
604
28
41
12
20
20
563
82
9
26
7,053
REVISED STATUTES OF ONTARIO
Offence
Convic-
tions
Dis-
missals
With-
drawals
Total
Cliildren Maintenance Act
Children Protection Act
Deserted Wives Act
Forest Fire Prevention Act
Game and Fisheries Act
Highway Improvement Act
Master and Servant Act
Mental Hospitals Act
Mining Act
Miscellaneous Provincial Statutes
Public Health Act
School Attendance Act
School Training Act
Venereal Disease Act
Theatre and Cinematograph Act
1
9
27
10
}>1
19
6
59
1
35
1
22
9
3
Totals
239
2
2
1
1
6
1
38
17
1
9
32
12
39
20
11
87
1
38
1
24
15
3
1
294
REVISED STATUTES OF CANADA
Offence
Convic-
tions
Dis-
missals
With-
drawals
Total
Indian Act 16
Radio Act I 16
Juvenile Delinquent Act I 15
Excise Act ■ --■• 1
Lord's Day Act I 1
Militia Act I 1
I
Totals ' 50
22
17
17
1
1
1
59
1946
ONTARIO PROVINCIAL POLICE
71
WARTIME REGULATIONS
Offence
tions
Convic-
Dis-
missals
With-
drawals
Total
Breach of Wartime Prices and Trade Board
Regulation
Breach of National Registration
Totals
9
16
1
24
10
40
25
1 25
50
GRAND TOTALS
Offence
Convic-
tions
Dis-
missals
With-
drawals
Total
Criminal Prosecutions . .
5,388
239
50
25
1,036
38
3
629
17
6
25
7,053
Prosecutions under Revised Statutes of
Ontario
294
Prosecutions under Revised Statutes of
Canada
5,
Prosecutions under Wartime Regulations
50
Totals
5,702
1,077
677
7,456
1945 Totals
5,595
765 510
6,870
Arrested with or without warrants and persons summoned for offences
against the Criminal Code and other Dominion and Provincial Statutes:
Arrested with Warrant under Criminal Code, Highway Traffic
Act and other Statutes 1,629
Arrested with Warrant under Liquor Control Act 87
Arrested without Warrant under Criminal Code, Highway
Traffic Act and other Statutes 3,544
Arrested without Warrant under Liquor Control Act 2,227
Summoned, etc 13,209
Totals 20,696
1945 Totals 16,205
Classification of the ages of persons prosecuted for offences against the
Criminal Code and other Dominion and Provincial Statutes, Highway Traffic
Act and the Liquor Control Act :
Ages 10-15 years ' 495
" 16-20 " ' ' 3;il3 ;
" 21-30 " ^...... : 7,229
" 31-40 •' 4,075
" 41-50 " 2,866
" 51-60 " 1,415
" 61-70 " 518
Over 70 years : 119
Companies 876
Totals 20,696
1945 Totals 16,205
72 REPORT OF THE COMMISSIONER OF THE No. 34
Classification of nationalities of persons prosecuted for offences against
the Criminal Code and other Dominion and Provincial Statutes, Highway
Traffic Act and Liquor Control Act :
Americans 396
Canadians 16,959
English 357
Indian 299
Irish 96
ItaHans 155
Jewish 177
Polish 237
Russian 196
Other Nationalities 948
Companies 876
Totals 20,696
1945 Totals 16,205
Classification of sex of persons prosecuted for offences against the Crim-
inal Code and other Dominion and Provincial Statutes, Highway Traffic Act
and the Liquor Control Act :
Males : 18,976
Females 844
Companies 876
Totals 20,696
1945 Totals 16,205
Classification of marital state of persons prosecuted for all offences
against the Criminal Code and other Dominion and Provincial Statutes, High-
way Traffic Act and the Liquor Control Act :
Married 9,559
Single 10,092
Widows 50
Widowers 115
Companies 876
Totals 20,696
1945 Totals 16,205
Number of Search Warrants executed under the following:
Criminal Code
Highway Traffic Act
Liquor Control Act
Number of arrests for other Forces
Summonses served for other Forces
1946
1945
842
1.101
11
22
1,257
1,200
549
434
1,709
1,177
LOST OR STOLEN PROPERTY RECOVERED
Property which had been reported lost or stolen to the value of ^401,932.73
was recovered bv members of the Force and restored to its various owners.
1946 ONTARIO PROVINCIAL POLICE 73
CONCLUSION
In conclusion I desire to express my sincere appreciation for the counsel
and advice received at all times from the Deputy Attorney-General and Sol-
icitors of your Department.
I also wish to thank the Press and Radio Officials, Municipal, Railway
and Royal Canadian Mounted Police Forces for their ever-ready assistance
and co-operation throughout the year.
I further desire to assure you on behalf of the Force of which I have the
honour to be the head that the same constant vigilance and devotion to duty
will be maintained in the future as it has been in the past.
Respectfully submitted,
WILLIAM H. STRINGER.
Commissioner of Police for Ontario.
REPORT
OF THE
MINISTER OF TRAVEL
AND PUBLICITY
PROVINCE OF ONTARIO
FOR THE FISCAL YEAR
1946 - 1947
Printed by order of
THE LEGISLATIVE ASSEMBLY OF ONTARIO
Sessional No. A8, 1947
ONTARIO
TORONTO
Printed and Published by The Printer to the King's Most Excellent Majesty
1947
To:
The Honourable Ray Lawson, O.B.E., LL.D.,
Lieutenant-Governor of the Province of Ontario, in Council.
May It Please Your Honour :
The undersigned has the honour to transmit herewith the First
Annual Report of the Department of Travel and Publicity, for the fiscal
year 1946-47.
I have the honour to be, sir.
Your obedient servant,
Arthur Welsh,
Minister of Travel and Publicity.
Department of Travel
and Publicity, Ontario.
Toronto, Ontario,
April 3, 1947.
Page 3
REPORT OF THE DEPUTY MINISTER
To The Honourable Arthur Welsh,
Minister of Travel and Publicity.
The undersigned has the honour to submit herewith the first annual
report of activities of the Department of Travel and Publicity for the
period, April 1, 1946 to March 31, 1947.
During its first year of operation the Department endeavoured to
carry out a dual program. There was, first of all, the immediate and
pressing need of preparing and organizing for the heavy anticipated flow
of summer tourists during the season commencing about the first of June.
With this was coupled the necessity of establishing a departmental organ-
ization to plan and take the initial steps toward the improvement generally
of this Province's tourist catering services and the further development
of our recreational resources.
The past year was the first in seven in which the citizens of our own
and neighboring countries were free to travel without restriction for
pleasure purposes. With the termination of the war in Europe and the
Far East, and the continuing prosperity of the reconstruction period,
there developed in the United States and to a similar degree, in Canada,
a feeling which was expressed by the slogan of the National Association
of Travel Officials in the United States: "You've Earned a Vacation —
Now Take It!"
It became evident early in the year that 1946 would establish new
records for vacation travel in Ontario. Opposed to this great potential
was the fact that for seven years, our tourist-catering establishments had
been unable to maintain their physical equipment and had been prevented,
by reason of shortages of every kind, from adding to their facilities.
Coupled with this was the fact that our country was still operating, insofar
as certain foods were concerned, upon a wartime economy.
Plans Made for Record Year
In the main, these problems were dealt with as follows :
(1) Tourist organizations, chambers of commerce, boards of trade
and similar bodies were "alerted" early in the year as to the necessity of
anticipating the increased flow of visitors to their communities. They
were urged to take action to ensure that proper facilities, even though
they be emergent in character, were available. The response to this action
was excellent. In many cases householders opened their homes, and
throughout the Province a loose but effective organization was established
to channel the flow of visitors to those communities and districts where
they were most likely to secure accommodation.
(2) Advertising designed to draw visitors to some of the lesser-
known areas was widely circulated throughout the United States. This
was to offset the possibility of a situation arising in which established
tourist regions might experience an overflow of guests while some of the
more remote areas might suffer as a result of overcrowding.
(3) Tourist reception centers were established at several of the main
border-crossing points from the United States. Trained representatives of
the Department met visiting motorists and rendered considerable assist-
ance in suggesting routes, providing guidance on points of interest and
arranging overnight accommodation. In addition, the friendly welcome
Page 5
REPORT OF THE DEPUTY MINISTER No. 48
given visitors to these centers undoubtedly had the effect of mitigating to
some extent at least, some of the disappointments and misunderstandings
which might have resulted from commodity shortages and other incon-
veniences stemming from the war period.
Few Complaints Recorded
In assessing the 1946 tourist season it is significant that although an
estimated fourteen million persons from the United States alone visited
the Province for varying periods, there were fewer than 30 actual com-
plaints registered with the Department. All of these were carefully
investigated and where warranted, action was taken to assist in securing
redress.
The Deparment does not, of course, claim full credit for the record
flow of tourist traffic into Ontario during 1946. Many other agencies,
including the Canadian Travel Bureau at Ottawa, transportation and
hotel companies, operators' associations, regional groups and chambers of
commerce, were very energetic in their efforts to stimulate the flow of
visitors.
The result of this coordinated endeavour is to be found in the tables
of statistics which are to be found elsewhere in this report. A prelim-
inary estimate places the value of the 1946 tourist flow into Ontario from
foreign countries at somewhere in the neighborhood of 110 million dollars.
There is no way, unfortunately, of appraising the amount of money left
in the Province by visitors from other portions of Canada or by Ontario
people who find that 412,000 square miles of their own Province offers
everything necessary for an enjoyable vacation.
900,000 Permits Issued
In 1946, with tire and gasoline restrictions lifted, the motorist again
became the major factor in our tourist industry. More than 900,000
touring parties entered Ontario during the year on Travellers Vehicle
Permits. This com.pares with the previous "highs" of 857,293 such permits
in '1931 and 828,222 in 1937. The next large group of tourists to Ontario
includes those travelling by rail. Although more than 1,200,000 persons
entered the Province from the United States as passengers on trains, the
large portion of them were classifiable as "intransits" travelling through
Southern Ontario between two American points. The net volume of U. S.
visitors arriving in Ontario by rail who could be properly classified as
tourists was 307,735.
Extension of motorbus services witnessed a marked increase in the
number of visitors using that method of transportation. During 1946
there were 221,523 entries by bus of U. S. citizens into Ontario. This
represents a substantial increase over corresponding figures for the pre-
1941 period.
The volume of boat and air travellers also increased far beyond the
former levels. Nearly 130,000 persons came to Ontario by boat in 1946,
while 29,049 travelled by airplane. The latter figure, although small in
proportion to the volumes recorded by other methods of transportation, is
significant in comparison with the flow in the pre-war period when entries
of this nature were so negligible that records were not maintained.
Improved Standards Sought
Much of the Department's activity during the year under review was
concerned with the developing of plans for improving tourist-catering
standards generally. A complete report of efforts in this direction is
Page 6
REPORT OF THE DEPUTY MINISTER
contained in the summary of activities of the Development Branch which
forms part of this Report.
In the field of development, an effort is being made to lengthen the
tourist "season". Ontario has all the attributes of a year-round vacation
land and a vigorous effort is being made to promote vacations in months
other than June, July and August. Considerable success was enjoyed by
the Winter Promotion Branch in stimulating interest on the part of
regional and community organizations in the provision of winter sports
facilities.
Departmental Cooperation With Other Bodies
The Department recognizes that in this age of rapid and inexpensive
transportation new and large areas have been brought within the reach
of the traveller to whom distance would have presented an insurmountable
barrier ten or fifteen years ago. With so many parts of the world in
competition for the tourist dollar there has developed a recognition of
certain larger areas as distinct recreational entities apart from provincial,
state or national boundaries. An outgrowth of this recognition was the
formation of the Northern Great Lakes Area Council, composed of repre-
sentatives of the tourist industry from the states of Michigan, Wisconsin
and Minnesota, and the Province of Ontario. Several meetings have been
held for the purpose of formulating a common program for the study
and further development of the tourist resources of the entire region.
Members of the Council include in each instance, the Governor or Prime
Minister of the state or province, and four persons appointed by him.
The Ontario representatives are the Minister of Travel and Publicity,
Mr. C. C. Manore of Sarnia, Mr. Fee Devine of Sault Ste. Marie and
Mr. Arthur Widnall of Fort William.
Another organization of a somewhat similar character is the Lake
Erie International Vacationland Conference which embraces representa-
tives from that portion of Ontario abutting on Lake Erie, together with
representatives from the states of Ohio, Pennsylvania and New York.
Although the Department is not actively represented in this organization,
it has co-operated with it in the furtherance of their program which
includes a canvass and survey of all recreational and accommodation
facilities in the area.
In addition, through the Canadian Association of Tourist and Publicity
Bureaus, the Department has co-operated with other travel promotion
agencies throughout Canada in the development of a national program.
All of which is respectfully submitted.
TOM. C. McCALL
Deputy Minister.
Page 7
REPORT OF THE PUBLICITY BRANCH No. 48
REPORT OF THE PUBLICITY BRANCH
The Publicity Branch has responsibihty for the preparation and
production of all publications and other literature used by the Department,
and of advertising and publicity for the promotion of tourist travel.
The latter item includes newspaper releases, special features for maga-
zines, compiling and releasing events lists to travel publications, planning,
producing and distribution of motion pictures, planning and purchase of
photographs, release of photos to such media as travel pages, house organs
and independent writers producing stories of value to the tourist trade in
Ontario, and to camp and resort operators who are unable to supply
themselves with suitable illustrative material for their folders. The
Branch also provides advice and assistance to individual operators and
associations in the production of folders, booklets and other publications.
In addition, assistance is given in publicizing special events such as
winter carnivals, regattas and various celebrations of a local character.
Production of Publications
During the past year much of the work of the Branch has revolved
around the necessity of producing entirely new publications to replace
those which have been in use, with minor changes, for some years. This
production work includes planning, writing, supervising of printing and
proof-reading. These publications are as follows:
"Southeastern Ontario".
"Southwestern Ontario".
"Central Ontario".
"Northern Ontario".
"Northwestern Ontario".
"The Fisherman's Ontario".
"Flying Facts About Ontario".
"Ontario — Your Best Vacation Bet".
"With Rod and Gun in Ontario".
"Where to Stay in Ontario".
"Winter Sports in Ontario".
"Waterways to Explore — The Rideau".
In addition to those listed above, the Branch also handled the revision
and re-printing of several publications which were formerly in use, as
well as the planning and production of an attractive illuminated letterhead
form to be used by the Information Branch.
Liaison is also maintained with radio outlets and information is
continually being furnished to commentators, announcers and producers
of special events broadcasts. During the year the Branch Director
appeared as guest on several programs and was given an opportunity
to publicize the vacation attractions of Ontario.
Contact with travel editors and outdoors writers is an important
function of the Branch. Writers from several of the leading metropolitan
newspapers in the United States visited Ontario during 1946 and with
the assistance of the Department secured material and photographs which
were given wide circulation.
Preparation of special feature articles for various newspapers and
magazines is also a function of the Branch. During the past year many
of these were produced and their publication resulted in excellent publicity
for the Province.
Page 8
REPORT OF THE PUBLICITY BRANCH
Travel Films Produced
Recognition of the important part that motion pictures play in
influencing prospective visitors in their selection of a vacation region
resulted in the acquisition by the Department in 1946 of the following
films :
"Algonquin Adventure".
"Manitoulin Holiday".
"Northern Autumn".
"Land of Niagara".
These are all in colour and three of them carry a sound-track. They
were especially developed for the Department's use and are in considerable
demand for showing to sportsmen's groups, travel and service clubs.
Still photographs form an important publicity media and during 1946
considerable progress was made in assembling a complete file of subjects
dealing with recreation in Ontario. As indicated above, prints of these
photos are made available to publications desiring them and a good
quantity has also been sent to Great Britain for distribution through
Ontario House. Apart from the very extensive use made of these pictures
within the Department, more than 500 requests for photos from outside
sources were handled during the year. In this connection, a policy is
followed of furnishing prints only where there is no possibility of compe-
tion with commercial photographers.
Photography Section Active
The photography section of the Publicity Branch undertook several
special projects during the year. A photographer accompanied the Amer-
ican Press Goodwill Tour party in June and secured a quantity of still
photographs which were furnished members of the party for reproduction
in their newspapers and as mementos of their visit to Ontario. In addition
an 800-foot motion picture in color was made during the tour and a copy
was furnished each participant. This film, which depicts Ontario's natural
attractions, has been extensively screened before service clubs, lodges,
sportsmen's groups and other organizations in eight states.
A somewhat similar project was the assignment of a photographer
to accompany a large group of Boy Scouts on a canoe trip through
Temagami. After editing and titling the film was made available to
sponsors of the trip and has attracted considerable attention through
screenings in New York state.
One of the major undertakings of the year was a photographic survey
of tourist attractions along King's Highways 11 and 17 extending from
the southern part of the Province to the Manitoba Border. This was done
in co-operation with the Department of Highways and a good file of still
photos obtained for use in departmental publications and elsewhere.
Publicity Releases
Publicity releases are forwarded regularly to 700 travel editors in the
United States. The policy of the Department is to supply such releases
only when it is felt that they contain material which can be justified from
a news standpoint. The effect of this policy has been that the Depart-
ment's releases, although fewer in number than those issued by many
other competing agencies, command a respect which is reflected in their
extensive usage.
Similar procedure is followed with all new publications. A copy goes
Page 9
REPORT OF THE PUBLICITY BRANCH No. 48
to each travel editor immediately after publication and a quantity of six
hundred and fifty is also furnished to the head office of the Outdoor
Writers of America to accompany that organization's monthly bulletin.
Good reviews with consequent wide publicity frequently results.
Planning and production of displays for exhibitions of various sorts
was also an important function of the Branch during 1946. A special
display was arranged for the International Air Show held in Toronto
during September, and two others were arranged for various outdoor
and travel expositions held in the United States and Canada during the
winter and spring.
A relatively minor but important activity of the Branch is the
handling of correspondence emanating from writers desiring to produce
material concerning the Province and requiring information of various
sorts. Some of this requires considerable research but an effort is made
to supply detailed data in response to all such requests.
Advertising Program
Although the Department's advertising activities were not as exten-
sive during 1946 as in some former years, the planning and execution of
a campaign in newspapers and magazines was one of the major activities
of the Branch.
During the spring months thirty-two distinct advertisements dealing
with various resort regions of the Province were produced. These were
single-column in size, ten inches in length, and appeared three times in
each of thirty-three metropolitan United States newspapers. An excellent
response was obtained from these.
Other advertisements, using approximately one-third of a page in
each instance, were developed for insertion in six leading outdoors and
sportsmen's publications. These ran in two consecutive issues and stressed
the Province's attractions from the standpoint of the fisherman and the
outdoorsman. Somewhat similar copy was prepared for insertion during
the autumn, the theme in this instance being hunting.
In conjunction with the Department's efforts to popularize the so-
called "off-season" months, a secondary advertising campaign was initiated
in August and appeared in a limited number of newspapers published in
American cities close to the Ontario border. These stressed Ontario's
attractions for the late-season vacationist and for the sufferer from hay-
fever.
In December and January a newspaper campaign was conducted in
another group of border cities for the purpose of advertising Ontario's
winter sports attractions. Half-column space was used, twice in each
publication. This was followed later by special advertisements drawing
attention to various special winter events, including the carnivals and the
ski schools conducted by the Department.
During January a "feeler" campaign was conducted in newspapers in
Florida, Texas and California for the purpose of selling Ontario for
summer vacations to those who spend their winters in the south. Response
to this was excellent, particularly from Texas which appears to offer a
fertile field for publicizing Ontario despite the considerable distance
involved.
Other advertisements were prepared by the Branch for publication in
newspapers in Northern Ontario in an effort to elicit information for use
in the new publication "Where to Stay in Ontario".
Page 10
REPORT OF THE PUBLICITY BRANCH
In the field of advertising plans must be made and copy and illustra-
tions prepared far in advance of actual publication. As a consequence a
good share of the Branch's activity during the year under review was
devoted to the development of the ensuing year's program. This includes
a series of advertisements to be run in a selected group of magazines and
newspapers in the United States, these being "keyed" to the Department's
new, literature. Advertising copy has also been prepared for publication
in Canadian newspapers and periodicals for the purpose of stressing
Ontario's attractions from the standpoint of the Canadian vacationist.
Goodwill Tour Resumed
The past year also saw the resumption of the very successful
"American Goodwill Press Tour" which had been held in 1940 and 1941.
In conjunction with the Canadian Weekly Newspaper Association and the
Hotel Association of the Province of Ontario the Department played host
to twenty-one United States editors during a 1500-mile tour of Ontario.
The following states were represented: New York, New Jersey, Pennsyl-
vania, Ohio, Kentucky, Michigan, Illinois. The trip was made in a char-
tered bus during the middle of June and the following points were touched
during the itinerary : Niagara Falls, Hamilton, Fergus, Flora, Owen
Sound, Little Current, Sudbury, North Bay, Sundridge, Huntsville, Algon-
quin Park, Pembroke, Ottawa, Smiths Falls, Chaffey's Locks, Kingston,
Picton, Belleville, Trenton, Peterborough, Clear Lake, Bowmanville, To-
ronto, Brampton, Burlington.
During the tour the visitors had an opportunity to attend the
unveiling of a memorial cairn in honour of the fishing trip of the late
President Roosevelt near Manitoulin Island.
A motion picture of the trip was made and is currently being
circulated among those participating. More than 85 articles and 140
photographs were published in the newspapers represented by the guests
and in one instance a special eight-page supplement, printed on magazine
stock, was distributed.
MARY AINSLIE,
Director, Publicity Branch.
Page 11
REPORT OF THE INFORMATION BRANCH No. 48
REPORT OF THE INFORMATION BRANCH
The Information Branch compiles and disseminates information re-
lating to the vacation attractions and facilities of the Province, distributes
departmental publications and other literature and assists in the distribu-
tion of published material prepared by regional associations, transportation
companies and resort proprietors. Another function of the Branch is to
reply to all mail enquiries, these frequently running in excess of 500 per
day. An important phase of its activity is the operation of reception
centers and the training of staffs for these.
During the period May 1 to September 30 more than 23,000 M^ritten
enquiries, each requiring an individual answer, were handled by the
Branch. The greater proportion of these, as might be expected, emanated
from the United States.
Chief Tourist Attractions
From this correspondence and from interviews conducted by recep-
tion center staff members, it has been possible to assess the chief tourist
attractions which Ontario has to offer. These are, in order of the impor-
tance placed upon them by the visitor:
1. Touring and sight-seeing.
2. Resort holidaying.
3. Fishing.
4. Hunting.
In handling mail enquiries close co-operation is maintained with the
Canadian Travel Bureau at Ottawa, the travel bureaux of other provinces,
as well as with district and local tourist organizations. The prime objective
is that the enquirer receive the fullest possible information with a
minimum of clerical delay.
Tourist Reception Centres
During 1946 a substantial start was made toward the establishment
of a chain of tourist reception centers at principal border points of entry.
Difficulties in procuring suitable sites and construction materials hamp-
ered progress to some extent but during the year it was possible to put
eight centers into operation.
Date of Date of Assist-
Location Opening Closing Supervisor ants
Fort Erie (Peace Bridge) Feb. 1 Oct. 31 W. W. Stratton ._._ 2
Sault Ste. Marie (Ferry Dock) June 17 Oct. 31 L. H. McAuley.. . 2
Pt. Edward (Blue Water Bridge) -June 19 Oct. 15 E. L. Hardy 3
Niagara Falls ^ , ,,
Rainbow Bridge June 22 Oct. 31 D. Allen 3
Whirlpool Rapids Bridge June 22 Oct. 31 D. Allen 2
Lansdowne (1000 Islands Bridge) -July 16 Oct. 15 G.T.Roberts.- 2
Prescott (Ferry Dock) Aug. 22 Oct. 15 J. G. Quinn 2
Windsor (Ambassador Bridge) -_..Sept. 25 Oct. 31 R.L.Henry 4
An information desk is also maintained in the Main Building of the
Parliament Buildings in Toronto. Due to the fact that many thousands
of visitors inspect the buildings during the summer months in addition to
Page 12
REPORT OF THE INFORMATION BRANCH
local people seeking vacation information, it has been found that this desk
serves a very useful purpose.
A reception center to serve traffic arriving in Windsor through the
tunnel was completed late in the season, as was another unit situated at
the junction of the Queen Elizabeth Way and King's Highway No. 8.
Plans call for the opening of these two centers on May 1st of the present
year, together with the eight listed above. Depending upon the availability
of materials and equipment other units will be placed in operation during
the late spring at Pigeon River, Fort Frances and Kenora-Keewatin.
Supervisors' reports indicate that a total of 128,038 visitors made use
of the facilities available at the reception centers during 1946. The
services rendered included information and advice on sight-seeing, tours
and vacation areas, provision of highway mays and other travel literature,
marking of routes and advice and assistance in securing overnight accom-
modation.
There is ample evidence that visitors have appreciated the facilities
provided by these centers. The program was greatly assisted by the
energetic co-operation of local organizations, particularly in aiding our
staffs to secure accommodation for visitors.
Close Liaison Maintained
One of the more important activities of the Branch is the maintaining
of a close liaison with the 216 organized chambers of commerce and
boards of trade in the province. These bodies have all demonstrated a
lively appreciation of the importance of the tourist industry and without
exception have extended a full measure of co-operation.
Apart from the many civic and local organizations which have inter-
ested themselves in the promotion of the industry, the Department has
had close contact with the following organizations devoted to the promo-
tion and development of larger areas :
The 1000-Island, St. Lawrence River and Rideau Lakes Association
The Muskoka Tourist Development Association
The Highlands of Haliburton County Tourist Association
The Lake of the Woods Tourist Bureau
The Kawartha Lakes Tourist Association
The Prince Edward County Publicity Committee
The Blue Water Highway Association
The Toronto Convention and Tourist Association
The Ottawa Industrial and Publicity Committee
The Essex County Tourist Association
The Bruce Peninsula Resort Association
The Land 0' Lakes Tourist, Resort Owners and Protective Association
The Greater Niagara Chamber of Commerce
The Huronia Historic Sites and Tourist Association
The Algoma Travel Bureau
The Fort William Civic Tourist Bureau
The Port Arthur Chamber of Commerce
The Norfolk County Chamber of Commerce
The Northern Ontario Outfitters Association
The Hotel Association of the Province of Ontario
Tourist Lists Distributed
A new departure within the past year was the development of a plan
Page 13
REPORT OF THE INFORMATION BRANCH No. 48
to make available to all recognized tourist organizations lists of persons
forwarding requests for travel information to the Department. These lists
are prepared every few days in mimeographed form and have the effect
of producing a quick on-the- spot follow-up to the enquiry in addition to
the material sent forth from the Department at Toronto. Lists covering
enquiries originating at the outdoors and travel expositions were also
issued as a supplement to the main list.
Travel folders and booklets produced by regional organizations are
distributed by the Information Branch to individual enquirers by mail
from the head office and directly from the reception centers. There is an
increasing appreciation of the importance of this type of publicity mater-
ial and of the effectiveness of well-produced printed matter with good art
work and illustrations. The typical vacation-planner does his planning at
home with his family, aided by maps, time-tables and travel literature,
and those districts which give due thought to attractive and informative
brochures, plentifully circulated, will find their reward in an increasing
share of Ontario's tourist business.
More Air Travel Seen
It is evident that the Province can expect an increasing number of
visitors to arrive by chartered or private aircraft. With this in mind, the
Information Branch has compiled, with the assistance of the Federal
Department of Transport, an Air Information Map indicating landing
fields and anchorages within the Province, and listing essential informa-
tion together with references to the Dominion authority from which
charts, clearances, etc., are obtained.
Three officers of the Department attended the Royal Ontario Museum
extension course on Fish and Wildlife, and with the assistance of the
Museum staff assembled information on the incidence of fish in Ontario
waters, which, coupled with data from the Department of Lands and
Forests, forms the basis of an information map in the new publication
"The Fisherman's Ontario",
Other lists compiled by the Branch include those dealing with golf
clubs, hotels, resorts, lodges, cabin and trailer camps. These will appear
in the booklet, "Where to Stay in Ontario". Amendments and additions
to these lists are continuous and a new annual edition is projected.
The Branch also maintains a file on coming events in Ontario and
supplies this information to periodicals and other agencies.
C. D. CROWE,
Director, Information Branch.
Page 14
REPORT OF THE DEVELOPMENT BRANCH
REPORT OF THE DEVELOPMENT BRANCH
The Development Branch is responsible for the inspection and the
licensing- of tourist camps as described in The Tourist Camp Regulation
Act, 1946, and also functions in an advisory capacity to resort operators
and persons who plan to enter the tourist industry.
One of its initial acts was the preparation of a questionnaire form
for the purpose of eliciting information regarding accommodation, facili-
ties and standards generally of cabin camps in Ontario. Before under-
taking a province-wide survey, members of the branch visited a number
of camps in the vicinity of Toronto and were able, through these visits,
to make comparative observations as to the standards to be expected
elsewhere.
Tourist Accommodation Surveyed
For immediate purposes the Province was divided into two zones
with the Pembroke-Parry Sound line as the northern border. No attempt
was made to cover the region north of this line inasmuch as licensing
regulations were already in effect under the jurisdiction of the Depart-
ment of Lands and Forests. Of the 25,000 miles travelled by the branch
staff, the following principal districts and highways were covered during
inspections and investigations during the season :
King's Highway No. 2 — Windsor to the Quebec Border.
King's Highway No. 3 — Windsor to Niagara Falls.
King's Highway No. 11 — Toronto to Novar.
King's Highway No. 17 — Quebec Border to Pembroke.
King's Highway No. 69 — Gravenhurst to Parry Sound.
King's Highways No. 21, 26, 27 — Sarnia to Penetanguishene.
Haliburton District.
Muskoka District,
Rideau Lakes District.
Trent Valley.
1,000 Camps Visited
During the course of their inspection, members of the staff visited
approximately one thousand camps. Each camp was assigned to a category
or classification, according to the extent and nature of the facilities
offered. As a result of this survey, the following conclusions emerged:
(1) There is a definite awareness on the part of the public generally
of the opportunities offered in the tourist industry. A large number of
prospective resort or camp operators visited the Department for assistance
and suggestions in developing projects. In addition to these, a large
volume of enquiries was received by mail, in which counsel and advice
was sought.
(2) By means of a first-hand survey covering such an extensive
area, members of the Department's staff were able to circulate valuable
information and assistance based upon the actual experience of operators
in the field. This included guidance on location, highway traffic statistics,
planning, various government regulations, equipment, etc.
(3) Operators of tourist catering establishments have a healthy
Page 15
REPORT OF THE DEVELOPMENT BRANCH No. 48
appreciation of the necessity of improving their standards if they are to
retain their competition position in the industry.
(4) Due to the falling-off of patronage during the war period, many
cabin camp establishments became run-down and with the current
shortages of materials a considerable time may elapse before they are
restored to the standard necessary to attract the desired type of patron.
During the course of the survey, Branch members had an opportunity
to interview many visiting tourists. In these interviews, which covered
seventy groups, only one complaint was voiced, and that with regard to
a matter beyond the scope of the Department's activities. There appeared
to be a general feeling of tolerance and satisfaction wi.th regard to
shortages of certain foods or lack of certain facilities.
A small number of complaints were received by mail and each was
investigated by the Branch. The principal cause of dissatisfaction thus
evidenced stemmed from alleged misrepresentation of facilities or rates
in advertising. Provision is now made under the Regulations enacted by
authority of The Department of Travel and Publicity Act, 1946, to deal
summarily with offenders.
Under auspices of the Branch a meat-cutting demonstration for
resort owners was_^rranged and held at Huntsville on June 3, a subsequent
one being held at Limberlost Lodge in conjunction with the spring
meeting of the Resort Association. Both were well attended. A repre-
sentative of the Branch also participated in the tour of the Lake Erie
rim sponsored by the Lake Erie International Vacationland Conference in
June and had an opportunity to study resort and recreational facilities
in the United States as well as in Southern Ontario. In addition, the
Branch was represented at the Humber Bay Conservative Conference.
Information Bulletin Published
Publication of a printed, four-page, tabloid-style "Information Bul-
letin" was also undertaken during the year. More than 1,800 copies are
now published each month and are forwarded to individuals and organiza-
tions interested in the expansion of Ontario's tourist industry. The
publication contains material of a newsy and informative character, a
calendar of coming events within the Province, notes and advice bearing
upon improved standards, statistics, etc. Its circulation has increased by
more than 500 percent since its initial issue, the increase resulting from
specific requests for inclusion on the mailing list.
MORGAN CARRY,
Director, Development Branch.
Page 16
REPORT OF THE WINTER PROMOTION BRANCH
REPORT OF THE WINTER PROMOTION BRANCH
Purpose of this Branch is to assist regional associations, camp and
resort operators and other individuals and groups desiring to develop or
improve facilities for winter recreation in Ontario. A secondary purpose
is to provide the necessary skilled training for our own people to enable
them to become confident in supplying skilled instruction in outdoor
sports.
One of the Branch's first activities was a representation made in May
to the Professional Ski Alliance and the Canadian Amateur Ski Associa-
tion, to have Canadian Travelling Ski Schools operate in Ontario for the
first time in history. Acceptance of this proposal ' resulted in a very
considerable amount of organization work to prepare for the actual holding
of the schools during the winter. Sites were selected at North Bay and
Fort William.
Ski Schools Held
The schools were held during the month of January, commencing on
the 11th and the 18th respectively. Their prime purpose was to stimulate
local interest in winter sports and to provide training for individuals who
migh qualify as instructors. Four of the leading members of the Ski
Instructors Alliance attending the North Bay school, and 31 student?
representing 15 municipalities were in attendance. The classes covered
ten hours each day and consisted of skiing on the slopes, lectures, first
aid demonstrations. At the termination of the course 14 students were
qualified as assistant professionals, 11 as amateur instructors and six
failed to meet the required standards.
From North Bay the Branch director and two representatives of the
Alliance continued on to Fort William where the school was attended by
23 persons, including visitors from Minnesota. Eighteen qualified as
assistant professionals and the remainder as amateurs.
In addition to these a smaller school was operated near Huntsville for
one week during the winter, nine representatives of district resorts being
given instruction.
The Branch supplied one of its members to officiate as a judge at the
North Bay winter carnival. Assistance was also given in organizing ski
events at the Sudbury carnival. It is estimated that 21,000 persons
witnessed these latter events, the largest crowds ever to attend a Canadian
ski meet. Further aid was also rendered by the Department in winter
activities at Nipigon, Cobourg, Huntsville, Fort William and Bracebridge.
Ski Guide Planned
Preparations are now going forward for the publication of a complete
skiing guide covering the Province. This will provide information such as :
location, length of season, average snowfall, tows, length and type of tow,
and other pertinent facts which will aid the prospective visitor to plan his
winter vacation. Plans are also under way for the provision of a proper
snow report service which will furnish information concerning winter
sports conditions to newspapers, radio stations, travel bureaux and other
organizations and individuals.
C. H. MELVILLE,
Director, Winter Promotion Branch.
Page 17
* FOREIGN MOTOR VEHICLES ENTERING ONTARIO, 1946
No. 48
* FOREIGN MOTOR VEHICLES ENTERING ONTARIO, 1946
According to Ports of Entry
Non-Permit Travellers
Class — Vehicle Commercial
Local Traffic Permits Vehicles
Brockville . 2,657 3,193 25
Cobourg 312
Cornwall 27,135 8,445 1,565
Courtright . 4,122 1,290 1
Fort Erie 793,769 193,753 12,360
Fort Frances 46,865 17,201 1,594
Fort William 5
Gananoque
Kingston 230
Kingsville 1 313
Lansdowne 5,013 70,166 1,846
Leamington 1 203
Midland 5
Morrisburg 1,267 1,809 38
Niagara Falls 338,206 206,188 4,492
Pigeon River 8,452 12,990 49
Port Arthur 191
Port Lambton 6,717 2,007 38
Prescott 7,772 8,756 766
Rainy River 696 1,282 36
Sarnia 79,196 85,015 1,357
Sault Ste. Marie 27,701 24,324 665
Sombra 4,015 1,038 25
Toronto 200
Walpole Island 2,614 701 8
West Dock 22 194
Windsor 1,268,628 263,285 56,576
Totals 2,624,849 903,096 81,441
(* — Source; Dominion Bureau of Statistics)
Page 18
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Page 19
* FOREIGN TRAVEL INTO ONTARIO, 1938-46 No. 48
* FOREIGN TRAVEL INTO ONTARIO, 1938-46
Classified according to numbei" of persons and means of travel.
Year By Railf By Bust By Boat By Aeroplane
1938 --_-. 569,010 N.A. 54,516 N.A.
1939 569,628 N.A. 68,851 N.A.
1940 552,806 N.A. 49,244 N.A.
1941 614,235 162,825 75,134 7,582
1942 916,465 120,651 52,820 4,592
1943 1,422,685 112,245 89,123 5,580
1944 1,634,791 151,197 93,772 6,766
1945 -_-__ ■- 1,594,040 196,616 134,676 9,628
1946 1,272,598 308,813 129,068 29,049
(t Includes intransit traffic through Southern Ontario)
* FLOW OF U. S. MOTOR TRAFFIC INTO CANADA 1945-46
Based upon Province in which Travellers Vehicle Permits wei*e Issued.
No. T.V.P.'s No. T.V.P.'s Pet. of Total
1945 1946 T.V.P.'s 1946
Maritimes 44,377 83,147 5.6
Quebec 138,215 277,641 18.6
Ontario 553,720 903,096 60.5
Manitoba 8,775 22,797 1.5
Saskatchewan 4,247 9,723 .7
Alberta 3,045 16,522 1.1
British Columbia 107,506 178,595 12.0
Yukon 30 585 —
Total 859,915 1,492,106 100.0
C'' — Source; Dominion Bureau of Statistics)
Page 20
ONTARIO
REPORT
of the
ONTARIO ROYAL
COMMISSION ON FORESTRY
1947
TORONTO
Printed and Published b\- Baptist Johnston, Printer to the King's Most Excellent Majesty
194 7
MAPS
Page
Map No. I. Proportion of Wooded Land in Woodlot Area 65
Map No. 2. Proportion of Waste Land in Woodlot Area 65
Map No. 3. Chief Physiographic Features in Woodlot Area 67
Map No. 4. Watersheds being considered under Conservation Authorities
Act 91
Map No. 5. Districts of Origin of Pulpwood Exports 147
Map No. 6. Possible divisions for Forest Operating Corporations 185
In Envelope at Back of Book
Map No. 7
Map No. 8
Map No. 9
Map No. 10
Map No. 1 I
Inspections made by Commission.
Areas under Concession, License or Agreement.
Showing Burned Areas.
County Forests.
Sawmills and Pulpmills.
GLOSSARY OF TERMS
In Envelope at Back of Book
PROVINCE OF ONTARIO
GEORGE THE SIXTH by the Grace of God of Great Britain, Ireland and the
British Dominions beyond the Seas KING, Defender of the Faith, Emperor
of India.
TO
MAJOR GENERAL HOWARD KENNEDY, C.B.E., M.C., B.Sc. (McGill)
GREETING:
WHEREAS in and by Chapter 19 of The Revised Statutes of Ontario,
1937, entitled "The Public Inquiries Act", it is enacted that whenever Our
Lieutenant-Governor in Council deems it expedient to cause inquiry to be made
concerning any matter connected with or affecting the good government of
Ontario, or the conduct of any part of the public business thereof, or of the
administration of justice therein, and such inquiry is not regulated by any
special law, he may, by Commission appoint a person or persons to conduct
such inquiry, and may confer the power of summoning any person and requiring
him to give evidence on oath, and to produce such documents and things as
the Commissioner or Commissioners deem requisite for the full investigation of
the matters into which they are appointed to examine;
AND WHEREAS Our Lieutenant-Governor in Council of Our Province of
Ontario deems it expedient to cause inquiry to be made concerning the matters
hereinafter mentioned;
NOW KNOW YE that WE, having and reposing full trust and confidence
in you the said HOWARD KENNEDY, DO HEREBY APPOINT you to be
our Commissioner to investigate, inquire into and report upon the forest re-
sources of Ontario and their conservation, management, development and bene-
ficial utilization for all purposes, including but without limiting the generality
of this reference the following subjects:
(a) the extent, nature and value of the forest resources;
(b) the methods employed in forest operations heretofore carried on and
the forest conditions resulting therefrom;
(c) the improvement of methods of planting, developing, cutting, manu-
facturing and otherwise utilizing forest trees, the marketing of forest
trees and the products thereof, and the development of new products;
(d) the closer integration of the various types of forest operations and of
the industries utilizing forest products;
(e) the relation of forestry and forest industries to other basic industries,
particularly farming;
(f) the relation of forestry to soil conservation;
(g) the status of woodsmen with particular regard to wages, working and
living conditions and the development of forest colonies;
(h) the education and training of forest engineers, forest rangers, scalers
and inspection personnel generally;
(i) the education of the pubHc as to the importance of the forests and
woodlots in the social and economic life of the Province;
(j) reforestation and research;
(k) the maintenance of an adequate forest-cover with a view to the regula-
tion of moisture run-off and the maintenance of levels of lakes and
streams;
(i) waterways and waterpower with relation to forest operations and the
manufacture of forest products;
(m) the statutes, orders and regulations under which forest lands are now
administered and licensed or made available to private enterprise;
(n) the supervision and administration of forest lands, forest operations and
industries utilizing forest products by the Department of Lands and
Forests;
(o) all other aspects of forestry; and
(p) all relevant facts relating to any matter into which, in the opinion of
you Our said Commissioner, it is necessary to inquire, in order to carry
out, fully and effectually the duties imposed upon you, hereunder.
AND WE DO HEREBY CONFER on you Our said Commissioner the
power to summon any person or corporation and require him to give evidence
on oath and to produce such documents and things as you Our said Commissioner
deem requisite for the full investigation of the matters into which you are
appointed to examine, by subpoena signed by you.
TO HAVE. HOLD AND ENJOY the said Office and authority of Com-
missioner for and during the pleasure of Our Lieutenant-Governor in Council
for Our Province of Ontario.
IN TESTIMONY WHEREOF We have caused these OUR LETTERS to be
made PATENT and the GREAT SEAL OF OUR PROVINCE OF
ONTARIO to be hereunto affixed.
WITNESS:
THE HONOURABLE ALBERT MATTHEWS,
LIEUTENANT-GOVERNOR OF OUR PROVINCE OF ONTARIO
at Our CITY OF TORONTO in Our said Province this sixteenth day of April
in the year of Our Lord one thousand nine hundred and forty-six and in the
tenth year of Our Reign.
BY COMMAND
(Signed) F. V. Johns,
Assistant Provincial Secretary.
To His Honour the Lieutenant-Governor of Ontario.
Sir:
Pursuant to powers contained in "The Public Inquiries Act",
Chapter 19, of the Revised Statutes of Ontario, 1937, and in accord-
ance with Letters Patent issued on the 16th day of April, 1946, I
was appointed the sole Commissioner to inquire into and report
upon certain matters therein set out.
The inquiry has been completed and I respectfully submit this
report.
I have the honour to be. Sir, your obedient servant.
Howard Kennedy,
Commissioner.
May 12, 1947.
PREFACE
CHAPTER I
CHAPTER II
CHAPTER III
CHAPTER IV
CHAPTER V
CHAPTER VI
TABLE OF CONTENTS
INTRODUCTION
Historical summary with comment.
Page
COMMISSION ORGANIZATION AND ACTIVITIES.
Personnel
Approach to problem
Field work
Woodlot survey
Public hearings
GENERAL IMPRESSIONS AND OBSERVATIONS .
Wasteful methods
Distribution of Crown lands
Ability of the forest to recuperate
Lack of roads
Sawmill situation
Pulp mill situation
Pole and tie operators
Balsam content in future forests
Provincial agencies wasteful of forests
Operational conditions affecting forestry
Need of co-operative effort
Personal contacts of Department officials with Districts
Administrative conditions affecting woods operations.
FOREST INDUSTRIES
Effect of war on forest industries
Employment provided
Effect on agriculture
Effect on hydro development, transportation and industry.
Capital expenditures and fixed charges
Pulp and paper industry
Sawmills
Imports of lumber
Comparison of forest industries
CROWN LANDS
Origin of Crown lands system
Rights to cut timber
Release of limit areas
Lands for agriculture, townsites, summer resorts, etc.
Reproduction
Recommendations on cutting practices
Fire protection
Description of limits
PRIVATE LANDS
Area included in study
Field survey
Chief physiographic features
Statistical information available
Shrinkage of forest cover
Woodlots
Maple products
Demonstration woodlots
Fire protection
Production possibilities
Planting of new forests
Seed collection
Free distribution of seedlings
Growth possibilities from plantations
Provincial, county and municipal assistance to forestry on private
lands
Bonus payments for plantations
Conservation and Reforestation Association
The Tree Conservation Act
Administration
Conservation Authorities
Finance
II
II
12
13
14
15
16
16
18
20
20
21
23
23
23
25
29
30
31
31
33
33
34
35
35
35
36
40
42
48
51
51
54
56
56
56
63
64
65
65
65
69
70
71
79
79
80
80
82
82
85
85
86
87
88
88
89
90
91
TABLE OF CONTENTS— Continued
Page
CHAPTER VII DEPARTMENT OF LANDS AND FORESTS 93
CHAPTER VIII LEGISLATION 98
CHAPTER IX TIMBER MANAGEMENT 102
Production of sawlogs by pulpwood operators 102
Various types of licenses and agreements 105
Drafting of agreements 1 07
Allocation of limits 1 08
Inspection and scaling 109
Status of scalers 109
Timber returns and accounting 110
Definition of a cord 110
Annual report Ill
Maps and statistical information 112
CHAPTER X FOREST PROTECTION
Control of human beings 113
Control of animals 113
Control of insects 115
Control of pathological conditions 119
Control of forest fires 120
Selection of personnel 1 20
Organization 121
Fire-control planning 122
Fire suppression 1 24
Equipment 1 26
Installations and forest improvements 127
Fire prevention 1 28
Closure of forests in time of hazard 129
Extension of protection area 129
Finance 1 30
CHAPTER XI PROVINCIAL AIR SERVICE 132
CHAPTER XII FISH AND WILDLIFE 135
CHAPTER XIII RESEARCH 141
Dominion Government research facilities available 142
Forest experimental areas 142
CHAPTER XIV EDUCATION AND PUBLICITY 144
CHAPTER XV EXPORT OF PULPWOOD 146
Increased inventories of wood cut for export 149
Export agreements 1 50
Newsprint clause in export agreements 151
Effect of export operations on the woods wage structure 151
Effect on lumber industry I 52
Export from Crown lands not under export agreements 153
Benefits created by export of pulpwood 153
General comment on export of pulpwood I 53
CHAPTER XVI LABOUR 1 56
CHAPTER XVI I MEASUREMENT OF TIMBER 1 59
CHAPTER XVIII LAND CLASSIFICATION 168
CHAPTER XIX FOREST COMMUNITIES 1 72
CHAPTER XX COMMENT ON SWEDISH FORESTRY 1 74
Crown ownership of mills I 75
Crown regulations on private lands 175
Forest administration I 76
TABLE OF CONTENTS— Continued
Page
CHAPTER XXI FOREST OPERATING COMPANIES—A Solution 178
Conclusions leading up to solution of problem 178
Principles applied in solution of problem I 79
Advisory committee to Minister 183
Limit allocation 185
Forest operating companies 185
Allocation of shares in forest operating companies 185
Expansion of forest industries 186
Provincial representation on boards of directors 186
Operating considerations 187
Advantages of proposal 187
Priority to domestic mills 188
Profits from manufacturing processes 188
Joint driving of streams 189
Comparison of costs 189
Overlap and duplication eliminated 189
Labor considerations 189
New and dormant limits developed to capacity 189
Joint towing operations 189
Government administrative advantages 190
Possibilitiss 190
APPENDIX A IDENTIFICATION OF SUBMISSIONS 193
APPENDIX B IDENTIFICATION OF WITNESSES 196
PREFACE
In order to prepare this report, sufficient material for several
volumes has been accumulated, but it was considered that a
voluminous document might defeat its own purpose. Serious
thought and effort have therefore at all times been directed towards
confining the report to the smallest dimensions consistent with an
adequate presentation of the essential information. On account
of the importance and complexity of the subject matter, it is felt
that no further condensation can properly be made. No official
summary has therefore been printed.
Statistics concerning forests and forest industries have been
found inconsistent and, in many instances, incomplete but despite
this I believe they are sufficiently reliable to indicate the facts
fairly, if not accurately.
I have endeavoured to reach sound conclusions and make in-
telligent recommendations from the data at hand. Where possible,
pictorial and graphical, rather than tabular methods of presentation
have been used. The pictures reproduced were chosen from among
several hundred and, with the exception of two provided by the
Reforestation Division of the Ontario Department of Lands and
Forests, were all taken by members of the Commission staff. They
represent typical rather than extreme conditions of the subject
portrayed and should be considered an integral part of the report.
Not only for myself but also on behalf of every member of the
Commission staff, it is a pleasure to record my thanks to the many
individuals, corporations and both Provincial and Federal Govern-
ment departments for their willing and cheerful co-operation,
which has been of the utmost value in the preparation of this
report and without which the task would have been unpleasant
and more difficult. To mention all by name would not be feasible;
to mention some would not be enough.
CHAPTER I
Introduction
A rational approach to the understanding and solution of any complex
problem requires some knowledge of the influences which have had a major share
in its development. In this connection, I submit the following narrative con-
cerning the forests of this Province. It is condensed mainly from material
appearing in the Annual Report for 1899 of the Clerk of Forestry for the Province,
which was reprinted in the Report for 1907 of the Department of Lands, Forests
and Mines. The late Mr. Aubrey White, then Deputy-Minister of the Depart-
ment, assisted in its preparation and a reading of the report in its entirety will
amply repay those interested in the early developments in forestry and the
forest industries in Canada. It must be kept in mind that prior to Confederation,
the forests of both Upper and Lower Canada were under the control of the
Central Government. My comments are printed in italics.
French Regime
Under the seignorial system the French Crown granted large tracts of land
to individuals who in turn allotted it to tenants under varying conditions, on
many occasions including conditions not pertinent to the original grant. The
use of the land for agriculture was the dominating feature and the conditions
relating to timber were almost negligible. As early as 1683, all oak suitable for
the use of the Navy was reserved for that purpose. This regulation was the cause
of later difficulty when it prevented the clearing of land. There were many
recorded instances where the cutting of such timber by colonists gave grounds
for complaint. This indicates that the conflict between the colonist and the timber
holder is not of any recent origin. Only one seigneuric,the Seigneurie de lOrignal^
was located in what is now Ontario.
British Regime
In 1763 Governor James Murray arranged for the survey of Townships and
the setting aside therein of adequate reserves of timber for fortifications and
barracks for the Army and Navy and for naval timber, mentioning specifically
that the area between Lake Champlain and the St. Lawrence River be set aside
as a reserve for "masting for the Royal Navy and other useful and necessary
timber for naval constructions." In 1775 Sir Guy Carleton was instructed, "It is
our will and pleasure, however, that no grant be made of any lands on which there
is any considerable growth of white pines fit for masting for our Royal Navy,
and which lie convenient for water carriage, but that you do cause all such lands
to be set apart for our use, and proper regulations made, and penalties inflicted
to prevent trespass on such tracts, and the cutting down and destroying of the
trees growing thereon."
It is therefore apparent that the system of setting aside Crown lands in the
Provinces of Ontario and Quebec had its genesis in the needs of naval construction,
first for the Navy of France and later for the Royal Navy of Britain.
Early Licenses to Cut Timber
Licenses to cut timber in Canadian forests were granted, by the British
Government, to contractors for the Naval Dockyards and there is ample evidence
to indicate that they took advantage of the privilege extended to them and
carried on a general business of supplying timber to the British market under the
guise of operations for the Naval Dockyards.
Protective Tariff
The principals in such contracts appointed local agents in Canada who
reaped rich rewards from the trade. The trade was given a tremendous impetus
in the early days of the nineteenth century, when the Mother Country turned to
Canada for timber after Napoleon shut off her supplies from the Baltic. Later a
heavy duty was imposed on foreign timbers as a revenue measure to help pay
for the Napoleonic Wars. These duties were afterwards retained with the avowed
purpose of protecting and fostering the colonial trade. The statistics of that
period indicate that the duty was most effective in curtailing the flow of timber
from Europe, particularly from the Baltic States, thereby building up the Cana-
dian export business to a corresponding degree.
Protection of this nature was reduced during the intervening years until in
1846, during the regime of Rt. Hon. W. E. Gladstone as Colonial Secretary,
it was reduced to a point where it was presumed to meet only the differential in
freight rates between the Baltic States and Canada. This protection was later
to disappear, but the Canadian timber trade was by then established so solidly
that the export trade to Britain was able not only to meet foreign competition,
particularly that of the Baltic States, but even to expand in the face of such
competition.
Timber Regulations
There seem to have been no Canadian laws governing the timber trade prior
to 1805 when Lower Canada enacted certain regulations, mainly concerning the
measurement and floating of timber in the St. Lawrence River. The earliest
enactments in Upper Canada appear in 1819 and, strangely enough, refer to the
placing of a duty on timber imported from the United States. This practice was
extremely popular at that time, as by such methods United States exporters
obtained the advantage of the existing colonial preference in the British market.
The matter of holding timber suitable for the British Navy was still very much
the governing factor, and instructions to the Duke of Richmond, Governor-in-
Chief at that time, were very specific as to the setting aside of such reserves.
Forests for Provincial Revenue
It will be observed that up to and including the first quarter of the nineteenth
century, the forests of both Upper and Lower Canada were looked upon as a
source of supply of timber for the Royal Navy and, incidentally, as a source
of profit for the individual privileged to take part in the trade. The country
derived no direct revenue in the way of stumpage or rentals, and local enterprise
Avas stifled unless it was under the auspices of an accredited agent of the con-
tractors for the Royal Dockyards. Naturally enough, such conditions created
a "black market" in which illicit lumbering operations flourished and this even-
tually resulted in the abolition of the dockyard contractors' monopoly.
[2]
Public Lands Act
In 1826 Sir Peregrine Maitland, Lieutenant-Governor of Upper Canada,
directed that British subjects resident in Upper Canada might cut timber in
the unsurveyed portions of the Ottawa River watershed.
Introduction of Stumpage Dues and Permits to Cut by Others than Naval
Contractors
A series of dues based on the number of logs cut was established. In order
to discourage the cutting of immature timber, double dues were imposed on
logs which would not square more than eight inches.
In 1827, the Commissioners of His Majesty's Treasury appointed Peter
Robinson as Surveyor General of Woods and Forests in the Province of Upper
Canada and provided that, in May of each year, he should report what districts
contained timber which was not "fit and proper" for His Majesty's Navy and,
therefore, might properly be felled by His Majesty's subjects. Auction sales
of such lots of timber were provided for and stumpage rates set. Each license
was for a quantity not exceeding 2,000 cubic feet. Unfortunately the Surveyor
General did not follow his rather explicit instructions and many irregularities
were permitted and condoned, with considerable financial loss to the young
Province.
Distribution of Crown Lands to Private and other Interests
In defiance of both the letter and spirit of the instructions repeatedly issued
by the home Government, the Provincial Government of the day deviated far
from the principles of both sound national economy and good business adminis-
tration. Public lands were widely distributed to favorites and others, causing
great harm to the young settlements in that normal development for agricultural
purposes of the townships involved was seriously hampered. The dissatisfaction
so engendered was to a large extent responsible for the Rebellion of 1837. Lord
Durham's exhaustive investigation and report on the existing abuses focused
attention on the exceedingly profligate manner in which forest land was dis-
pensed to friends and legislators. Some legislative councillors received grants of
5,000 acres with an additional 1,200 acres for each child, the only cost being the
fees paid to officials who drew up the deeds.
The setting aside in Upper Canada of one seventh of the land for Clergy
Reserves further aggravated the situation. In one special instance a private
company received entire control of 1,100,000 acres of choice timberland in the
western portion of the young Province.
The result of the alienation of such large areas of public domain to private
ownership was inevitable. Speculators could buy timber, from owners who
had acquired these areas, for much less than the stumpage dues charged for an
equivalent amount of timber cut on Crown lands. Schemes for obtaining stumpage-
free timber have persisted under the guise of settlement almost to the present day.
Widespread forest fires, due mainly to land clearing operations of settlers,
seem to have persisted throughout this period, with little organized effort to
meet the situation. The clearing of land for agriculture apparently was con-
sidered much more important than any effort at forest conservation.
[3]
Crown Timber Act; Timber Licenses Introduced
A depression in 1847-48, due largely to over-production in the immediately-
preceding years as a result of a brisk demand and high prices for timber in the
British market, resulted in a Select Committee on the Lumber Trade being
appointed by the Canadian Legislature in 1849. This Committee drew up the
first Crown Timber Act which was passed the same year under the title, "An
Act for the Sale and Betterment of Timber Upon the Public Lands".
This Act provided that the Commissioner of Crown lands might grant
licenses at such rates and subject to such conditions, regulations and instructions
as might be established from time to time by the Governor of the Province,
upon the advice of the Executive Council. These licenses were for 12 months
only and provided for proper returns of timber cut.
The accompanying regulations specified the sizes of limits, and the Crown
dues (stumpage) to be paid, and provided for the renewal of the licenses in
question where the holder had complied with the regulations. They also guarded
against speculators holding berths by stipulating that, in all seasons not speci-
fically excepted, the operator must cut at least 500 cubic feet of timber or 20
saw logs per square mile of limit on larger holdings, with somewhat higher pro-
duction on berths of four square miles or smaller.
Ground Rent Introduced
Subsequent regulations, promulgated in 1851, indicate that considerable
timber stealing was going on, as stiff penalties were provided for squatters and
others taking violent possession of disputed lands and for interfering with
surveying, etc. Annual ground rent of two shillings and sixpence per square
mile of limit was introduced and provision made to assure the payment of dues
for timber slidage and Crown dues generally.
Export Levy on Unprocessed Wood
Logs exported from the Province (presumably to the United States) were
assessed at double rates of Crown dues on domestic production.
Separation of Forest Lands from Agricultural Lands Recommended
That forest fires were a matter of grave concern a century ago is evidenced
by the introduction of a Bill, during the Session 1854-55, for the protection of
the forests and preventing the setting of fires to the woods for the purpose of
clearing lands. This Bill was dropped, due to the setting up of a Select Com-
mittee with its terms of reference "To examine and report upon the present
system of management of the Public Lands and the various dues arising there-
from, together with the present mode of selling, leasing and otherwise disposing
of the same, to report thereon with all convenient speed, with power to send for
persons, papers and records." Conflicting testimony before this Committee
emphasized the clash of interests between the operators producing square timber
and the sawmill operators, and between those interested in the sale of land and
those interested in perpetuating the forest. For the first time the folly of allotting
typically forest land to settlers, allegedly for agriculture, was thrown up in
relief. The separation of forest lands from agricultural lands, by means of
forest surveys, and the prevention of timber-mining by pseudo-settlers, were
even then advocated but have never been adequately controlled. Much has
[4]
been accomplished since 1921 in the control of the practice of allotting limber lands
for farming, but further remedial measures are required, mainly the completion of
the survey advocated 90 years ago, as a result of which typically forest lands will be
set aside in perpetuity for the growing of forests.
Hardwoods
The attitude towards hardwoods on the part of pine operators at that time
was forcibly expressed before the above Committee by one witness, James
Henry Burke of Bytown, as follows:
"But mark this co-incidence! Surrounding this pine territory and con-
tiguous to the great lumber fields is the large area to which we have
alluded, possessing a fertile soil and timbered with hardwood. This
timber has not the value of pine, and its destruction is not a national
loss. "
// any considerable proportion of these hardwood stands remained to-day,
they would form the backbone of huge furniture, flooring and handle industries
which now have to import raw materials from the United States or from Eastern
Quebec and the Maritimes.
The Select Committee apparently did not get to the point of making recom-
mendations, but referred the evidence to the Legislature and suggested another
Select Committee of the House at the next meeting of Parliament.
Subsequent Orders-in-Council seem to have been aimed, mainly, at emphasiz-
ing the fact that the payment of ground rent did not create a vested right which
would preclude the imposition of new conditions or of increased payments for
rentals or Crown dues.
Squatters and Timber Stealers
Great embarrassment was caused by the squatters and timber-miners in
the late 50's and early 60's. Unwise regulations helped to destroy much good
timber in that, although a settler might cut down and burn timber for land
clearance, he could be treated as a trespasser if he sold it. Timber stealing was
widely practiced and dealers were known to allot contracts up to 100.000 cubic
feet of hewn timber to individuals who did not possess any timber-holdings
from which it could be produced.
A Select Committee was appointed in 1863 to enquire into the rapid destruc-
tion of the forests, but the time at their disposal was too short to go thoroughly
into the subject. Another Committee, appointed the following year to complete
the work, never made any report. Representatives of the industries involved
were prominent on the Committees.
Confederation
With Confederation in 1867, among the subjects coming exclusively within
the scope of Provincial Legislators was "the management and sale of public
lands belonging to the Province and of the timber and wood thereon."
Although there is evidence that much thought was given to, and a diligent
search made for, a remedy for the problems besetting land settlement and forestry
in the Province, the matter seems to have been side-tracked for various reasons.
[5]
Hemlock Bark Export
A symptom of the destructive forest exploitation of those days is portrayed
in an enquiry, set afoot in 1868, during which a Select Committee of the House
of Commons studied the shipment of hemlock bark to the United States for
tanning purposes. It indicated that some 100,000 cords of bark were exported
annually from Canada and that in providing this, 10,000 acres of forest were
denuded and the timber left to rot on the ground, constituting a fire hazard when
the bark has been removed. The Committee in its report recommended an
export tax of $1.00 per cord on hemlock bark to curb the drain on the forests,
pointing out that each area involved would be cut out in 10 to 12 years, leaving
the community without a continuity of income from tanbark production. Peti-
tions to the Government by exporters and interested parties killed the efforts of
the Committee and with them the hemlock forests of Ontario and Quebec, as
the Government decided to take no action. The interested operators at the time
brought out the arguments of the exporters: employment provided, wages
distributed, impetus to other industries, etc.
Export of Sawlogs
Another Select Committee of the Provincial Legislature of 1868 dealt with
the export of sawlogs, shingle-bolts and stave-bolts, but it does not appear that
they ever rendered a report. The interests involved in export appear to have
been extremely well served in the Legislatures in this country as well as in the
United States.
A Select Committee of the Dominion Parliament in 1874 painted the export
duty on sawlogs as a protection for Michigan timber operators, a detriment to
Canadian settlers and as only of slight benefit to the Canadian sawmilling
industry, with the result that the export duty on stave-bolts and oak logs was
removed in 1 875.
The export duties on shingle-bolts, spruce logs and pine logs were altered at
various times in the 80's and after a bit of what might be termed "horse trading"
between the sawmill operators and the log exporters, the Government announced
in 1891 that the export tax on logs to the United States was removed. The same
year the duty of $1 per M. on Canadian lumber was also abolished, and
free trade in lumber and logs between Canada and the United States came into
existence. This happy condition had existed only a couple of years, when a
business depression set in in the United States and a duty of $2.00 per M. was
again imposed on rough lumber from Canada. This acted as a protection for
the Michigan operators, who increased their imports of logs from the Lake
Huron Forests of Ontario to be sawn in the United States instead of the lumber
formerly imported from Canada.
The pleas of the Ontario lumbermen, particularly those from Western
Ontario who were hardest hit, were finally heeded and in 1898 the Provincial
Government passed regulations providing that all logs cut on Crown lands should
be manufactured in the Province. United States operators immediately claimed
breach of contract on the part of the Government and that, in any event, the
regulations were ultra vires of the Provincial Government. The case was heard
in 1899 with judgment in favour of the Province.
[6]
Northwestern Ontario
Lumbering in Ontario was at first mainly centred in the Ottawa Valley
and on streams flowing to Lake Ontario and Lake Erie, but the rapid develop-
ment of the sawmilling industry necessitated a westerly expansion, and in 1871
the Muskoka-Parry Sound area was opened up for the sale of timber licenses.
The following year the industry spread along the north shore of Lake Huron
and flourished for some decades, though there are few units now left of that
tremendous development.
The areas then leased supported thriving communities until a bit after the turn
of the century, but the reckless exploitation carried on inevitably destroyed the industry.
In general, the history of lumbering, not only in Canada but also in the United States,
has been that few areas once opened up have lasted more than 25 to 30 years, when
the vast majority of timber-miners have had to seek "cuJ horizons, usually leaving
desolation in their wake. It is true that a few concerns have been more far-sighted
and reasonable in their treatment of the forest and have remained in business in the
same locality for generations. Unfortunately, the number of such operators is only
too small and their experience has been the exception rather than the rule.
Diameter-limit Introduced
The first appearance of a diameter-limit in cutting regulations occurred in
1871 when, by Order-in-Council, a minimum diameter of 13 inches on the stump
was decreed. The only species being cut in quantity in those days were the
white and red pines, white spruce, oak and hemlock (for bark).
Floating of Logs and Timber Marking
Owing to the floating of logs by various operators in the same streams, ' An
Act respecting the Marking of Timber" was passed in 1870. Regulations were
made to prevent the duplication of marks and severe penalties provided for
misappropriation of timber so protected.
For a considerable period, rival operators disagreed widely regarding the
use of streams, as the operator who had originally improved the river by the
removal of rocks from rapids, the construction of booms, piers, slides, etc.,
claimed prior and sometimes exclusive rights. Since previous legislation had
not clarified the situation, "The Streams Bill", passed in 1881, provided that all
operators might use such improvements and have passage along the banks of any
drivable stream, upon the payment of proper tolls. The schedule of these tolls
was to be approved by the Lieutenant-Governor-in-Council.
A test case concerning these rights (McLaren and Caldwell) was fought in
1881 and, though the Dominion Government disallowed "The Streams Bill"
each time it was presented by the Ontario Government in 1881, 1882 and 1883,
an appeal to the Privy Council by Caldwell was settled in his favor in 1883 and
the Bill, when again presented to the Dominion Government in 1884, was allowed
to stand until replaced by a more comprehensive Act in 1887. Since then there
has been little alteration in the legislation covering the joint driving of streams.
Ontario Cullers Act
An Act for the licensing of cullers, adopted in 1890, provided for more
adequate returns and standardized methods of measurement.
[7]
Forest Fires
The forests of Ontario seem to have been plagued by fires from the earliest
days of settlement and reports to the various Governments concerning the matter
appear as early as 1849 and at intervals from then on. In the report of Mr.
P. M. Partridge, Superintendent of Woods and Forests, under date of 1859,
the question of forest fires was forcefully drawn to the attention of the Govern-
ment of the day, particularly in view of the very extensive prospecting operations
for gold which appeared imminent.
Nothing much seems to have resulted from the complaints made at that time
and all efforts were then directed rather toward suppression than prevention.
In 1878, "An Act to Preserve the Forest from Destruction by Fire" was
passed which contained many of the clauses necessary for preventing the setting
of fires, but it proved to be difficult to enforce due to a lack of organization.
It was only in 1885 that a fire-prevention organization, consisting at first
of only 39 rangers, was inaugurated but from this modest beginning it has
expanded tremendously in size and efficiency with the years.
Beginning of Pulp and Paper Industry
Exploitation of the forests of Ontario was confined to lumbering and the produc-
tion of tank ark,, ties, poles, etc.. until after the turn of the century when the utilization
of wood for the manufacture of pulp began to assume considerable proportions. The
opening of the Temiskarning and Northern Ontario Railway in 1903 and the con-
struction and operation of the Grand Trunk Pacific through the northern Clay Belt
shortly afterwards, gave a great impetus to the production of pulpwood and to the
construction of mills in Northern Ontario.
Agricultural Land for Settlers
Since the days of the earliest settlements in Ontario, records indicate that,
though the lumbering or pulp and paper industry invariably forged ahead of settle-
ment, the cutting operations were always closely followed by some genuine settlers
who intended to stay on the lands. Unfortunately, in addition to this stable group,
there was always a host of pseudo-settlers or timber-miners who apparently had little
or no intention of remaining to cultivate the soil. They quickly stripped the farms
allotted to them and passed on to new allotments, generally leaving waste and deso-
lation in their wake. Until comparatively recent years little effort was made to
confine their activities to land which could possibly be maintained in agriculture
after its forest cover was gone. One has but to look at the annual sales and free
grants of land to such so-called settlers, with the accompanying cancellations of
lands previously allotted, to see the widespread ramifications of this development
which might well be described as a "racket". (See diagram, page 146.)
A Select Committee in 1863 reported and recommended:
'It appears from the evidence that settlement has been unreasonably
pushed in some localities quite unfit to become the permanent residence
of an agricultural population. Especially has this been the case on
some of the Free Grant roads and adjacent country, lying between the
waters of the Ottawa and Lake Ontario. Your Committee would refer
to the evidence and recommend that the Government should, in all cases,
ascertain positively the character of the country before throwing open
any tract of land for settlement, so that such lands that are really not
fit for profitable cultivation may not be thrown upon the market.
There being considerable diversity of opinion among the witnesses in
regard to some of the localities adverted to, it seems to the Committee
that the Government should have an examination made by some thor-
oughly competent and reliable officer, whose report would be available
in any further consideration of this subject."
This question which Was reported on over 80 years ago has never resulted in
the over-all survey recommended though, with the passage of years and the increase
of the drain on the timber resources of the Province, it was and still remains one
of the crying needs of forestry.
General
It is timely to note that the history of forest operations in this Province, with
few exceptions, has been that of "cut out and get out."
The white pine stands of the Ottawa Valley now support only a handful of
operators, whereas in the hey-day of that area over a billion feet of white pine was
produced per year. It will take upward of a half century to restore the pine industry
of that area, and then only if Vigorous and comprehensive restorative measures are
tak,en.
The white pine and red pine forests of the Georgian Bay district are no more
and it is doubtful if they are likely to be, or indeed can be, restored in any measure
approaching the density or quality of the original stands. They, along with the
equally Valuable stands of the north shore of Lake Huron, disappeared in about
three decades with a very considerable portion of the raw product exported to the
United States in the form of unprocessed logs.
The Trent Valley watershed and adjacent areas, once one of the finest white
pine areas in the world, now present hundreds of thousands of acres of wasteland
as mute testimony to man's extravagant methods of exploitation.
There were large areas of white and red pine west of the Great Lakes, but these
too have disappeared. A few small areas remain only because of their inaccessibility
under the methods practiced when the stands surrounding them were removed.
The preference of pulp mills for spruce will similarly remove that species as a
major component of our forests unless remedial measures are taken. The damage
is not yet irreparable, but the present state of our former pine forests indicates the
need for amended treatment of remaining conifer stands; otherwise we shall not
hand on to succeeding generations forests which will approach in quality or quantity
the virgin stands which are now being cut.
In case the foregoing words have given the impression that forest industries,
in the past, have been the chief cause of forest destruction, it should be emphasized
that settlers and private owners of woodlots, with due allowance being made for their
capabilities and facilities, have practiced less in the Way of reasonable forestry methods
and conservation than have the larger commercial operators. Some of what are
potentially the most productive, but actually the worst managed forest lands, are in
or adjoining the earliest settled portions of the Province. Since these lands are
close to the consuming market and have the best growth and moisture conditions, they
present possibilities for an exceedingly profitable field in the matter of reforestation
and management.
[9]
The history of the past hundred years in this Province indicates that most of
our forest problems have existed in one form or another throughout this period.
The number of Commissions and Committees set up to enquire into these various
problems, without appreciable result, demonstrates that something more than a
Commission of enquiry is needed. It is apparent that public apathy, selfish interests
of individuals and sometimes political expediency have, in the past, all had a share
in delaying the rational utilization of our forests.
I cannot end this chapter more suitably than by quoting from a report of a
Special Committee of the Legislature in 1863. It indicates the necessity for publicity
before any change in forest policy is made by the Government.
"Your Committee . . . would further recommend that wherever even
any minor change in regulations may be thought advisable, it should
be published for at least three months before any Order-in-Council be
passed to give effect to it, so that the Trade may have an opportunity
of being consulted in regard to the change contemplated."
// the word ''Public" were substituted for the word "Trade", the above recom-
mendation would fit the needs of the present day. An enlightened public on guard
against unwise exploitation of its forest resources is the influence most likely to assure
the perpetuation of these resources for future generations.
CHAPTER II
Commission Organization and
Activities
Letters Patent creating the Ontario Royal Commission on Forestry were
issued only on April 16th, 1946. I had commenced work, however, on March I 1th.
An organization had to be set up, a staff gathered together, office premises found,
office equipment purchased and plans and arrangements completed for the field
work which, if not under way early in May, would not have been completed in
the same year.
After a long search, satisfactory head office accommodation was obtained
in the Administration Building of the Small Arms Plant at Long Branch, and the
following staff was appointed:
PERSONNEL
Legal Counsel Donald Guthrie, K.C.
Head Office
Office Manager and Accountant R. P. Egerton, C.A.
Secretary of the Commission Major W. H. Hewson, B.A., LL.B.
Secretary-Steno to the Commissioner Miss M. E. Edmondson
Stenographer Miss A. Cory
Field (Mobile Office)
Four Forest Engineers E. S. Davison, M.F.
J. F. Turnbull, B.Sc. F.
J. Miles Gibson, D.Sc, O.B.E.
E. S. Fellows, M.Sc. F.
Field Clerk and Stenographer S/Sgt. A. Barry
Field Draughtsman A. Dudman
Cook
In addition, the Department of Lands and Forests of British Columbia,
for the period May 17th to August 1st, loaned to the Commission the services
of E. W. Bassett, B.A.Sc. (For.), their officer in charge of fire protection. His
services were invaluable in the study of fire protection methods, personnel and
equipment. He has keen powers of observation, and his advice on many other
phases of the work, in addition to fire protection, was often sought and freely
given. The Royal Commission is indeed grateful to the Minister and to the
Deputy Minister of Lands and Forests of British Columbia for Mr. Bassett's
services.
The Royal Commission also sincerely appreciates the action of Purdue
University, Indiana, in granting leave of absence to Prof. Lloyd VanCamp, a
[ II 1
former Canadian and graduate of Toronto University, now Extension Forester
there and an acknowledged expert in matters pertaining to farm woodlots. He
ably assisted the Royal Commission in organizing and carrying out the farm
woodlot survey. His counsel, vast knowledge of the subject and genial per-
sonality were of great importance in this phase of the work of the Commission.
Brigadier George M. Grant, now Assistant General Manager of the Bell
Telephone Company and formerly officer in charge of the Royal Canadian Elec-
trical and Mechanical Engineers Corps (R.C.E.M.E.) of the Canadian Army in
Europe, has rendered outstanding service in assisting the Royal Commission
in studying the administrative organization of the Department of Lands and
Forests. The Royal Commission is indebted to the Bell Telephone Company for
making his services available, and to Brigadier Grant who was unsparing of his
time and unsurpassed organizing ability.
APPROACH TO PROBLEM
Throughout the whole course of my inquiries, the guiding purpose which I
have kept steadily in mind has been the attainment of "Total Forestry", which
I would define as the complete utilization of the forest resources of the Province
for the greatest use and enjoyment of its people.
It was realized at the outset that the narrow concept of forestry, namely
the growing of trees and the removal of wood products in various forms, has
influenced the public viewpoint to the almost total exclusion of the other very
important functions which the forests must perform in the rational development
of the social and economic life of the Province. Forests are the main factor in
controlling stream flow, in preventmg floods and erosion, in maintaining soil
water levels — a matter of increasing concern in much of the agricultural area of
the Province — and in providing a habitat for most of the wild life of the Province.
This latter function is basic to the recreational values of our countryside and,
if neglected, tourist enterprises which are potentially so valuable to Ontario
will never reach their optimum development. It is quite feasible to have forested
areas close enough to centres of population so that all classes, particularly chil-
dren, may have an opportunity of enjoying them. In addition, it may be demon-
strated that they are a profitable investment in the economic as well as in the
social sense.
The closer co-ordination of various basic industries such as agriculture,
forest industries, mining, hydro-electric development and tourist activities was
visualized. What has happened in the past shows that much can be done to
eliminate waste and provide a more rational and co-ordinated development of
these resources which are, or may become, important to more than one Govern-
ment department dealing with the above industries.
It was ever kept in mind that the vast bulk of our forests, whether or not
leased for varying periods to forest industries or operators, still belongs to the
Crown or, in other words, to the people of the Province. The majority of these
real owners live in communities remote from any of the larger forested areas.
For this and other reasons they have so little opportunity of seeing or using
their forests that they do not comprehend their ownership and the responsibility
involved. Even those who live in, or on the fringes of the larger forested areas
seldom appreciate the importance of perpetuating their resources.
Finally, there had to be faced the problems created by many operators
[12]
with selfish interests, whose development programmes and outlook do not go
beyond a decade or two and whose practices are detrimental, not only to the
general public, but also to themselves.
It was, therefore, with some knowledge of existing conditions, yet with high
hopes of finding means to improve them, that the Royal Commission embarked
on and carried out its studies of the forests of Ontario.
FIELD WORK
A Canadian National Railways colonist car was converted to a mobile
office by removing six sections at one end and installing desks, filing cabinets
and a draughting table. The remainder of the car was utilized as sleeping and
living accommodation.
At each location at which the car stopped, the District Forester had a tent
erected which served as cookery and dining room for the Commission staff and
as living quarters for the cook. Cooking utensils, china and food were carried
on the car. Beyond the normal difficulties encountered in obtaining and retaining
cooks, the living and working arrangements left little to be desired.
Stops varying in length from eight to fourteen days were made at the
following points: Pembroke, Temagami, Shebandowan, Minaki, Sioux Lookout,
Armstrong, Geraldton, Orient Bay, Mobert, Oba Lake, Moonbeam, South
Porcupine and Biscotasing. Shorter stops were also made at Kawene, Mine
Centre and Hearst.
These locations were chosen because they provided siding facilities close to
suitable flying bases for pontoon-equipped aircraft, thereby making feasible a
complete coverage of the forested areas of the Province.
At all times the Commission had at its service one aircraft, with an extra
one on some occasions, provided by the Provincial Air Service. Without this
method of transportation, it would have taken several years to complete the work
done by the Commission staff between May 6th and September 20th.
Map No. 7 indicates the specific areas inspected by the Commission staff.
Where there were roads and motor transport was available, inspections were
made by this means. Sometimes only boats or canoes could be used, but the
vast majority of inspections were made by means of air transport to the vicinity
and travel on foot to and over the area inspected.
It will be noted that all forested areas of the Province were covered, from
Quebec to Manitoba and from the American boundary to the Severn River
in the north.
The engineering staff of the Commission flew in all weather, only requiring
that the hill-tops be visible. On many days, in order to deliver the various
members to their different destinations, ten or twelve ascents and descents were
made, on and from water usually unfamiliar to the pilots. The fact that neither
aircraft nor personnel were injured in the hundreds of landings and take-offs
speaks volumes for the efficiency of the Air Service.
Not all camps of all operators were visited, but some member of the Com-
mission staff visited a sample of woods operations of every large or medium-
size industrial concern in the Province, whether it be engaged in the manufac-
ture of pulp and paper, the production of lumber, the cutting of ties and poles,
[13]
or the export of pulpwood. In the case of the large companies, operations on
each of their Hmits were inspected. Not only were recent cuttings examined,
but those of past seasons were checked for evidence of new growth and the cutting
practices utilized. Where their history could be ascertained, old cuttings of 20
or 30 years ago were included in the survey, as were also old and recently burned
areas in both cut-over lands and virgin forest.
Inspections were made in a uniform manner and reported on standard forms.
Consequently, the Commissioner or any member of his staff would observe and
report on the same elements, whatever area was visited. Each report called for
observations on operating practices; waste (such as high stumps, large tops left,
timber felled and left on ground, timber left standing which should have been
cut, etc.); labour conditions, including housing; indications of efficiency or other-
wise; the compliance with or neglect of regulations; any evidence of fish and game
and the tourist possibilities; the type of roads and equipment; the number of
men employed, etc. Normally, scalers who had previously measured wood in
the area acted as guides and in order that a fair sample should be shown to the
Commission, the particular areas or camps to be inspected were not arranged
beforehand but were selected by the engineer making the inspection on the date
of the inspection.
Many hundreds of photographs were taken. These are all catalogued and
copies have been attached to the reports concerned.
In addition to field inspections, the Commissioner and members of the
Commission staff have visited the wood preparation plants of every pulp and
paper mill in the Province, nearly every sawmill sawing more than one million
feet board measure per annum, many smaller sawmills and the two pole and
timber treating plants operating in Ontario. Notes on the equipment and
processes of all plants were made.
One result of this effort has been the compilation of probably the most
complete and up-to-date data that has ever been assembled on the methods,
processes and equipment of the wood-using industries of Ontario and the resources
which supply them.
Throughout all the survey work involved, the matter of urgency was the
keynote. It was felt that the field work must be completed before the winter
set in and that the report must be prepared with the least possible delay. Only
the most loyal co-operation of the field staff made possible the completion of the
survey during the open season. They devoted practically every Sunday and
every legal holiday to inspections, usually being in the air by 8.30 a.m. and spend-
ing about 10 hours per day in the field, often more. Notes were written at night.
I mention this service here as I feel that such unstinted devotion to duty should
at least be drawn to the attention of the government.
WOODLOT SURVEY
In addition to the above survey of operations on Crown lands, three Com-
mission engineers spent seven weeks travelling by road, separately, over the
southern portion of Ontario inspecting farm woodlots in every County. Govern-
ment officials, County Councils, County Assessors, personnel of wood-using
industries and interested individuals were questioned. Accordingly, a splendid
over-all picture was gained of the conditions existing and the remedial measures
already undertaken; in addition, some ideas were obtained as to the measures
[14]
which should be undertaken in the future to meet the challenge presented by the
existing state of this most important element affecting the future prosperity
of this Province.
PUBLIC HEARINGS
Scheduled Public Hearings commenced on October 28th. Meetings were
held in Sault Ste. Marie, Port Arthur, Kenora, Fort Frances, Geraldton. London,
Cochrane, North Bay, Pembroke, Ottawa and Toronto.
The Commission sat for 39 days, 142 briefs were presented and well over
half a million words were taken in evidence. The response of the public was
gratifying and much useful information and many sound recommendations were
received.
5]
CHAPTER III
General Impressions and
Observations
One cannot spend a season in an intimate study of the forests of the Province,
and the manner in which they are being operated and administered, without
forming some broad general impressions which are relevant to any report on
existing conditions and recommendations made to improve them.
WASTEFUL METHODS
The most striking impression made on the staff of the Commission has
been the tremendous, almost incredible, waste resulting from single-purpose
operations carried on in the past and still being carried on by most of the operators.
Few sawlog operators produce pulpwood occurring in the stands they cut over.
(In fact, many of their leases or permits do not allow them to do so.) Few
pulpwood operators cut sawlogs occurring in their pulpwood stands, except to a
very limited degree for their own use. (Again, many of their licenses do not per-
mit them to cut sawlogs.) Much material of pole and tie size, and eminently
suitable for these purposes, together with pulpwood and sawlog material, is
therefore left on many areas widely scattered across the Province. In a number
of cases, the material remaining is not sufficient in quantity to justify an econo-
mical separate operation later and, in any event, the trees so left usually die of
sunscald within three to five years, or are blown down and form a fire hazard.
Pulpwood operators tend to concentrate on spruce, for two reasons:
(1) Pulp and paper makers prefer spruce, particularly black spruce, because
of its high yield and strength and its satisfactory behaviour in manu-
facturing processes.
(2) Pieceworkers on woods operations prefer black-spruce-swamp stands
because the trees are rarely very large, are reasonably uniform in size
and are free from heavy limbs; from swamp stands there is a high yield
in cords per acre and consequently the potential earnings are high.
In addition to the main reasons cited above there are secondary reasons,
such as an ill-founded belief amongst Ontario operators that extremely high
sinkage losses occur in balsam. There is also the woodsman's dislike for handling
green balsam on account of its gummy nature which soils hands and clothes
much more than either spruce or jack pine. Jack pine does not find favor amongst
paper makers except in the manufacture of kraft and, particularly in this Province,
its use has not been widely developed in making other pulps and papers.
The following tabulation based on the annual returns of the Department of
Lands and Forests for 1945-46 indicates the percentages of coniferous pulpwood
species cut in this Province and the percentages exported, compared with the
[16]
percentages existing in the forests of the Province as revealed by the Report of
the Forest Resources of Ontario, prepared in 1930.
Total Total Cut for
Stands Cut Export
Spruce 63.3% 81.7% 81.0%
Jack pine 27.7% 11.6% 12.1%
Balsam 9.0% 6.7% 6.9%
100.0% 100.0% 100.0%
This indicates a heavy overcut of spruce, with a corresponding undercut in
jack pine and balsam. In many mills in Quebec and New Brunswick, balsam
constitutes over 40 per cent of the pulpwood supply and, in some cases, almost
double that percentage. Sinkage losses are higher than in spruce but not high
enough to deter the companies concerned from using the full balsam content
of their various stands. The percentage of jack pine utilized in the manufacture
of groundwood pulp is much higher in mills outside the Province than in mills
in the Province of Ontario. Jack pine utilization in some newsprint mills in
Canada exceeds thirty per cent of the groundwood pulp content.
Excessive Waste in Road Building
The advent of the bulldozer in road construction has ushered in an era of
waste from that source. Few woods operators now clear the right-of-way before
construction and, as a result, excessive waste is caused and potential fire-hazards
created. Workmen do not like to work in the resultant tangle because it slows
their rate of production and the sand and earth embedded in the tree trunks
Excessive waste from bulldozing a road before cutting the right-of-way. {Pulpwood-exporting company
operation.)
Excessive waste beside a trucJi road. {Domestic paper company operation.)
dulls their tools. Hundreds of miles of road exist with waste material similar to
that shown in the accompanying pictures. Clearing of the right-of-way before
bulldozing should be rigidly enforced.
DISTRIBUTION OF CROWN LANDS
The illogical allocation of Crown lands to operators has also made a marked
impression. In many instances, timber areas held by operators have little
relation to the present needs of the units of industry concerned. Some have much
more than their mills, as presently constituted, can possibly use while others,
particularly the vast majority of the sawmilling group, can foresee their extinc-
tion due to lack of timber m periods of time varying from two to 25 years.
Areas containing much, if not most, of the remaining stands of timber
suitable for sawlogs are included in pulpwood concessions. Areas of timber,
certainly not yet overmature, are now being cut over for pulpwood to be exported
in an unmanufactured state; while some domestic mills whose future with respect
to wood supply is far from clear, within a measurable period will have to transport
wood from more remote regions beyond the areas now being cut over for export.
The cutting of quantities, far beyond the actual annual growth under current
silvicultural practices, is common on many limits, particularly amongst the
sawmill group and the export group. Conversely, other large areas of limits are
not developed to an extent approaching their possible sustained-yield because
the present manufacturing capacity of the limit holders concerned cannot utilize
the annual growth of such large areas.
The practice in Ontario, and elsewhere, of allotting limits in rectangular
shapes, instead of conforming to single watersheds or groups of watersheds,
frequently prevents the logical and economical development of a considerable
portion of the area involved because of its location on a watershed which does
not naturally serve the mill concerned.
Throughout the years there has been no enduring policy concerning the
leasing of forest lands to the various interests. Political expediency at times
seems to have entered into negotiations and at all times the bargaining capacity
of the units of industry or commerce concerned has made itself apparent. The
diversity of the clauses and conditions in the leases, under which the Department
of Lands and Forests now staggers, will be treated in Chapter IX.
The bald facts are that it was formerly so easy to get annual permits to cut
timber, without assuming the financial and other obligations entailed in the
holding of timber areas, that many operators acquired the rights to cut over
forest lands on a shoe-string basis and did not realize, until it was too late, that
pulpwood concessions and reserves had been granted on such a scale that there
was little timber-land left available, except in the northwestern portions of the
Province on the waters of the English and Albany Rivers.
A casual glance at a map may induce some to think that there are still vast
untapped forest resources in the far north. True, there are still considerable areas
not yet exploited, but their extent is not nearly as great as many believe. From
Hudson and James Bays westward there are tens of thousands of square miles of
desolate waste swamp-land of the kind graphically portrayed in the two accom-
panying plates. Here, poor drainage rather than extreme climatic conditions is
responsible for the absence of forests of commercial value. Moderately good
iub-arclic swampland on the James Bay Coastal Plain near the Atlawapisk_ai River. The dark patches are pools of
stagnant water, the rest is moss. There are thousands of square miles of swampland similar to this.
V t'A' :-\#it5l
Sub-arclic swampland. Note how the drainage provided by the small stream on the left induces some
scrubby tree-growth near its banl^s. Even if accessible such timber would be valueless for commercial
purposes.
timber grows in fringes along the water courses, but this deteriorates progressively
as the distance from the banks of the streams increases until, at about one-
quarter of a mile back from the shore, only worthless scrub exists. Thirty-five
miles from the mouth of the Albany River, spruce up to 27 inches in diameter
was observed in the narrow strip of timber near the water, but the tenuous
nature of these fringes is such that their exploitation is out of the question, at
least for many years to come. Even if it ever becomes feasible to exploit them,
they will yield comparatively little wood.
ABILITY OF THE FORESTS TO RECUPERATE
Another striking impression gained is that of the tremendous capacity of the
forests to heal the wounds made by both man and nature. It is amazing how
the appearance of once devastated areas changes in a quarter of a century.
Given a chance and a little assistance, nature can largely correct most of the
damage done to our forests, except in the case of red pine and white pine. Out-
side the Ottawa Valley and areas which may be planted in Southern Ontario, it
is unlikely that these species will predominate over any considerable area of the
Province within the next century.
LACK OF ROADS
Mention of the lack of roads necessary for rational development of the
forests cannot be neglected. Without a tremendously expanded road system,
we cannot hope to practice sound silvicultural methods. In the past, due to
1201
the fact that forest industries in Ontario have depended almost entirely on water
transport for wood delivery, operators have perforce cut only the conifer species
which will float. Further than that, practically all operators, whether their
needs were for sawlogs, pulpwood, ties, or poles, took only the sizes and species
of conifer in which they as individuals happened to be interested. This has
resulted in a tremendous upset of the original balance of species, and quantities of
both hardwoods and softwoods have been left to blow down or die of sunscald.
The overmature or otherwise weakened stands, in turn, have left the forests a
prey to fire and insects as it is such stands which constitute some of the highest
hazards of insect epidemics or fire, or both.
I recommend that a widely expanded road-building programme,
jointly agreed upon by the Departments of Highways, Agriculture,
Mines, Lands and Forests, and Travel and Publicity, be undertaken
with the aim of opening up every major watershed. Unless trunk road
systems are provided, we cannot hope to utilize anything approaching the
maximum output of our forest areas in wood products, or to reap the greatest
advantages in recreational and tourist activities.
SAWMILL SITUATION
Evidence as to the precarious position of the lumber industry has been
presented by the Chief of the Timber Management Division of the Department
of Lands and Forests and by many of the lumbermen concerned. Not more than
two or three per cent in number (representing between twenty and thirty per
cent of the annual output of lumber) of the 1,147 licensed sawmills in the
Province have sufficient limits to permit of sustained operations at any figure
Jack_ pine suitable for ties and poles left standing after a spruce pulpwood cut. These trees will die
and be blown down, i Domestic company operation, i
L _j» I • ; i to» ^•■^ Iff" • ♦"■ > i- Si ^ ■ ■<? > •-
I'l^
/.;M^
af?'
■v-*ifis
>« I?
•^* ^'^
:^^
.^?.
Merchantable pulpwood left after cutting. Note the abandoned pile-bottom i lower right).
\Pulpwood-exporting company operation.)
i
Merchantable pulpwood left standing. Pulpwood-exporting company operation.)
y\ m^{ is
f
i
approaching their present output, unless remedial measures are taken. The
remainder of the mills, with the communities dependent upon them, can only
await extinction, with casualties commencing at a very early date. A solution of
this problem will be suggested.
PULP MILL SITUATION
In relation to their individual long-term requirements, the supply of wood
from this Province for domestic pulp and paper mills varies widely.
Some mills, in the past, have been dependent on other Provinces for a large,
if not a major proportion of their pulpwood. In some instances, this wood is
transported past mills outside Ontario which are themselves in short supply.
Shipments of wood from other Provinces may at some future date be curtailed
or stipulations may be imposed which could effectually reduce, or even eliminate
this source of supply. If such an occasion should arise, mills in Ottawa, Hawkes-
bury, Cornwall, Thorold and Merritton may be forced to curtail production to
such a degree that the communities would suffer most severely.
A few domestic mills are known to have limits which appear to provide
little or no opportunity for a future increase in production. In some cases, areas
have been leased, under agreement to pulpwood exporters, which would have
furnished the logical and economical source of raw material to provide for such
expansion. Only a complete survey of the forest resources of other mills will
disclose their position.
A few mills obviously have more than enough area under agreement to
permit of continuous operation on a much larger scale. Curiously enough, one
of these companies has agreed in its contract not to increase the capacity of its
mills. Another company has ample, indeed more than enough, area to sustain
its domestic mills, but its privilege of exporting an amount equal to its domestic
consumption could result in the rapid impoverishment of its limits if such con-
sumption were to expand to any considerable extent.
POLE AND TIE OPERATORS
There are two pole and tie treating plants now operating in Ontario. They
are largely dependent for their raw materials on agreements made with limit
holders producing pulpwood or sawlogs. This prevents long-term arrangement
for continuous supply, as such agreements cannot normally be made more than
a year or two in advance. One timber treating company has limits, but they are
insufficient to produce, in perpetuity, any quantity of material commensurate
with probable future requirements.
I believe that supplies so vital to the operation of our railways, hydro net-
works and communication systems should be organized on a perpetual basis,
and recommendations to that end will appear later in this report. I want to
emphasize here that much material, eminently suitable for sawlogs, poles and
ties, is now diverted to other uses or is left to die and decay after single-purpose
operations.
BALSAM CONTENT IN FUTURE FORESTS
There is no escape from the impression that past and present cutting practices
in Ontario will result in a higher percentage of balsam for the next cutting-cycle
123 1
y/ml)
*^
mmmmuammmmssaimm
Small limber cut for sawlogs. Compare With pieces in pulpwood piles on page 104
^iBiaHHHE
High- grading in pulpwood cutting. Note the patches of mixedwood in the foreground and the scattered
hardwood left standing through the cut-o er area [Pulpwood exporting company operation.)
y t
mm
^^tV■'s'■
^'■^
than is now present. Current industrial utilization does not approach full use
of the balsam content of the original stands, let alone the higher percentage
almost inevitable in the future. The spruce budworm prefers mature balsam
stands and epidemics normally originate there, followed by extremely disastrous
losses. The result of possible future epidemics of this pest can only be more
serious as the balsam content of the forest increases. A better balance between
species than is indicated by current reproduction is therefore a prime necessity.
PROVINCIAL AGENCIES WASTEFUL OF FORESTS
I regret to say that the Hydro-Electric Power Commission of Ontario has not
applied ordinary forest conservation practice, except to a very limited degree, on
most of its major projects in the last quarter of a century. Failure to clear trees
from the site of storage reservoirs before inundation, which might have been
insisted upon by the Department of Lands and Forests, has resulted in consider-
able loss of timber and, worse still, has left unsightly and dangerous tangles of
tree trunks and debris covering tens of thousands of acres. These wooden barriers
will remain for several decades, a menace and an expense to recreation seekers
and forest operators who may wish to use these waters.
The story has varied little with the passing years. Lady Evelyn Lake,
north of Temagami, dammed in 1925, Montreal River (Algoma District), Mar-
mion (Moose) Lake at Steeprock, Lac Seul, Long Lac, Ogoki Reservoir, all bear
evidence of the same lack of consideration concerning conservation of timber,
aesthetics, and economy of future forest operations.
I consider that works of a public nature should set a high example to private
industry in matters of forest conservation but such has not been the case Limit-
operators, in general, have similarly left uncleared the areas to be inundated by
dams for the control of stream flow for driving operations.
Submerged area. Ogok.i storage reservoir. Many square miles are submerged in this manner.
■w •*^'
r "t Mmr-m 5
Submerged area. Lady Evelyn Lake power storagereservoir after twenty-five years of inundation.
Debris of this nature will remain for many decades.
Typical view of the shoreline of McKenzie Bay. Lac Seul. Such shores make landings with
aircraft or small watercraft impossible except on calm days. Flooded in 1927.
i&
<)*»•-
Landslide on the Little Jacl^fish River. I he bunk, i^ tu/ buck over 200 feet ul (his point.
Ogok.i Dicersion.
■•:i':2^>t>^jsl
Submerged area above a log storage dam. Opi^inimika River. Note the logs scattered amongst debris.
*^.
V
A' /
l->i'.
I -,«^
\
's
.^^
''«»-i
Ca/m jLa^e Reservoir. A close-up view of the debris along (he shore. Flooded in 1927.
Submerged area, IVal^ami River, caused by a dam built to facilitate log driving. Flooded in 1928.
OPERATIONAL CONDITIONS AFFECTING FORESTRY
There are many ills affecting forest operations on Crown lands. There is,
in general, a tendency to blame everything on the operator. In my opinion this
is far from fair, for the following reason.
Up to the present time, the general public has ignored or failed to compre-
hend the fact that only by sensible and rational utilization of our forest resources
can we hope to maintain the forest industries and their dependent communities
in perpetuity. This failure by the general public to appreciate the situation has
been reflected in government and industrial forest policies, or the lack of them.
If sensible and uniform laws and regulations are provided and uniformly applied,,
the great majority of operators are, I feel, ready and willing to implement them
fully. Severe penalties, again uniformly applied, will rapidly bring the reluctant
operators into line.
In most of the larger units of forest industry in this Province, organization,
financing and planning have been directed toward the production of raw materials
and the processing, manufacture and sale of finished products. On the other
hand, the renewal of the forest resources, the lifeblood of the enterprises concerned,
has been largely left to chance.
The main reason for this situation is that few top executives of the major
components of our forest industry have had any training, either academic or
practical, in the operation of forests. In general, they have achieved their domi-
nant positions in the industry by way of mill operations, finance, sales or account-
ing. The result is that so long as wood is made available they continue to con-
centrate on production costs and sales and, beyond the cost and the assurance
of an immediate supply of wood, pay comparatively little attention to the opera-
tions of the forest. I gained the impression that a majority of top executives
have carried out few inspections of their woods operations and that in most
cases any inspections which were made were a by-product of their occasional visits
to the company hunting and fishing lodge on the limits rather than for the purpose
of a critical analysis of forest conditions affecting labor and the efficient utilization
of effort and material.
It is customary for companies to appoint a Vice-President in charge of Woods
or a Woodlands Manager, who has risen to the position through forestry or wood-
production activities. His work includes planning, government contacts,
attendance at industry and association meetings and conferences, and entails
responsibility for policy and personnel matters. He normally becomes so sub-
merged by such activities that he has little time to visit the woods and is lucky
if he can call at branch headquarters once or twice a year.
Next in line comes the local Divisional Manager. He, in turn, is harassed by
varied problems of management and construction, labor, personnel, supply and
estimates, income tax deductions and, during the War, the multiplicity of returns
occasioned by rationing and Selective Service. He may get to his headquarters
depots once or twice during the cutting season but he is fortunate if he can visit
the odd camp, where the cutting is being carried on, even once during the season.
[291
The result has been that in most cases production quotas have been allotted
to the various camp foremen who have been held responsible for their fulfilment.
They have done their best under the circumstances but if the forest must suffer
in order to produce those quotas, then the forest, rather than the quotas, feels
the effect. That such is the case is borne out by the fact that widely varying
conditions may normally be found in adjoining areas operated by the same com-
pany. This was apparent in all parts of the Province.
I am convinced that senior executives, who demand the highest standards in
housekeeping and prevention of waste in their mills, would be horrified if they
were to travel over their cut-over areas and see the waste of material and effort
in the woods.
The solution lies in an increase in supervisory staff, both technical and prac-
tical, probably on a scale amounting to four for each one now employed. I am
convinced that on most operations three times the money spent in tripling or
quadrupling the supervisory staff would be returned in savings due to the elimina-
tion of waste effort and waste material. The government should urge all senior
executives of forest industries to give thought to the disparity between the
numbers of men supervised on woods operations by one superintendent or one
foreman, as compared to the numbers of men whose work is supervised by a
similar foreman in the mills. It will be found that while one foreman in the mill
has probably thirty or forty men working in a closely knit group and under
shelter, his bush counterpart has one hundred or more men spread over several
square miles of forest and exposed to the elements over which he has no control.
A snowstorm or rainstorm may easily cut the efficiency of a working crew in half.
More time-studies, technical control and supervisory staff are sadly needed
in the forests and their provision can be made to pay big dividends. Much,
if not most, of the poor forestry practice now carried on would thus be eliminated,
because practically all the wasteful practices can be demonstrated to be unsound
economically.
So that my reasons for writing the above critical paragraphs regarding forest
operations may not be misinterpreted, let me reiterate my previous suggestion
that abuses exist because an informed public opinion does not insist that govern-
ment policy demand a more rational development of our forest resources. My
acquaintance amongst industry executives and operating personnel is wide and
I believe that the vast majority of them, if given practical and uniform laws and
regulations, uniformly applied, would heartily subscribe to and observe all
measures which will perpetuate and improve our forest resources.
NEED OF CO-OPERATIVE EFFORT
An important impression that I wish to record is that created by the apparent
hostility, bordering on distrust, evident between the different groups of forest
industries and even between members of the same group. The lack of co-
operative effort is unsound and costly, and results in much waste on operations
due to lack of interchange of products. Concerted efforts to eradicate this
unfriendliness would pay worthwhile dividends.
[30 1
Waste resulting from poor supervision of cutting. Two thirteen-inch and two twelve-inch spruce trees
left standing by piece-workers within fifty feet of a sl^idway on a sawlog operation.
Government and industry should endeavour to achieve a greater spirit of
mutual trust and confidence. A wider and freer exchange of ideas would be
beneficial to both groups.
PERSONAL CONTACTS OF DEPARTMENTAL OFFICIALS
WITH DISTRICTS
As the distance widens between Toronto and the outlying districts, there is
evidence of a lack of personal contact between Head Office staff and the District
staffs, which is more or less proportional to the distance of the latter from Toronto.
Shortage of personnel is probably the main reason why this lack of contact
persists. Whatever the reasons, they should be eliminated, and frequent visits
of several days, not hours, should be made by all senior staff at Head Office to
all Districts. When these visits are made they should be of the nature of field
inspections, rather than calls at the District Offices.
This subject will be developed in a later chapter.
ADMINISTRATIVE CONDITIONS AFFECTING
WOODS OPERATIONS
It would appear from the foregoing that there are many things which need
correction administratively. These will be covered later in some detail. At
[311
this point, however, I should like to pay a tribute to the staff of the Department
of Lands and Forests. With very few exceptions they are an intelligent, capable
and industrious group of men who deserve great credit from the people of this
Province.
They are, however, sadly inadequate in numbers and badly overburdened
with administrative problems. Senior personnel lack trained assistants who can
carry part of the load, particularly the routine administrative detail which must be
performed if chaos is not to result. This applies to District Foresters and Chief
Rangers. Forest Rangers, in many cases, have overlapping duties to do with
scaling, fire protection and fish and game activity. In addition, the added (neces-
sary) burden of re-assessment of all government lands has laid an extra adminis-
trative load on ranger personnel, which will interfere with their normal duties for
several years to come. Scaling and inspection work generally, which is really the
core of all timber management endeavour, cannot but suffer as a result of the
extra burdens placed on an already inadequate staff of scaling personnel.
Many, if not the majority of, scalers have now reached or passed middle age
and can no longer hope to do the amount of bush travelling on foot which is
required of such personnel. Only a much widened programme for the training
of scalers, and salaries which will attract bright young men into the trade, will
bridge the present gap that exists between the numbers of scalers needed and the
numbers available.
32
I
CHAPTER IV
Forest Industries*
It is not my intention to compare the forest industries of Ontario with other
basic industries in the Province. I consider the forest industries sufficiently
impressive in themselves. In any case, the statistical data on the forest industries,
though similar, are not strictly comparable with those on the other basic industries.
It is customary to look upon lumbering and pulp and paper manufacturing
as constituting the forest industries and, in general, to disregard the production
of ties, poles, Christmas trees, etc. Nor is proper attention given to the number
of industries using wood and paper which are dependent upon, and would never
have been developed except for, the production in their proximity of the neces-
sary raw materials. All these groups will be treated in appropriate chapters of
this report.
The thought might well be put forward that the tourist business and fish
and wildlife enterprises should be classed as forest industries and I believe that
future developments will make this classification logical. For the purpose of
this report, however, they will be considered in a separate chapter.
EFFECT OF WAR ON FOREST INDUSTRIES
The war years and years immediately following the war is not a wholly
satisfactory period to use in an analysis of industry. The dislocation and diffi-
culties which result from war are recognizable, and possibly some of their effects
should be noted.
The pulp and paper group, whose product was marketed mainly in the
United States, were under rigid government controls as to prices, production
quotas and mill salary and wage schedules. The lumber group, particularly
the larger permanent mills, suffered even greater dislocation of their normal
routine; they were forced to sell one-half to two-thirds of their output in local
markets at rigidly fixed prices, which in many cases were not reflected by over-
all costs and did not allow a proper differential between the different grades.
The inevitable result was that the older and more reputable operators were
penalized to the advantage of the owners of the smaller temporary mills and the
less scrupulous operators, many of whom, with the connivance of black market
customers, could and did flout the price ceilings by the manipulation of grades
and by under-measurement. The mill salaries and wage schedules of the lumber
group were also closely controlled, though in some mills wage controls could
be evaded by paying wages at piecework rates.
Until recent months, woods labor earnings have borne little resemblance
to established wage ceilings and, as is usual when the anchor is gone and the
vessel allowed to drift, results have been most erratic. The operators cutting
pulpwood for export have played a major role in the ascending piecework spiral
*Pulp and paper mills and sawmills are shown on Map No. I 1 . Distribution of private and
public lands is shown on Map No. 8.
[331
which has reached a point where I consider it threatens the continued well-being
of the primary forest industries of the Province.
For several years past, rising piecework rates included bonus payments
previously unheard of, such as those for deep snow encountered, cutting of strip-
roads, cash payments for trips home, etc. Few, if any, operators were able to
avoid being caught up in the spiral which now permits pieceworkers to earn
$12.00 to $15.00 in an 8-hour day, with corresponding day-labor rates pegged at
$6.20 per day. The inevitable result has been that work on a day basis has
almost vanished and piecework rates have been established for practically all
phases of woods effort. This has created some most undesirable conditions from
the standpoint of forestry and conservation.
For instance, the production of sawlogs has been traditionally and properly
on a daily or monthly wage basis because quality of product is of greater economic
importance than quantity of output. Care taken in sawing up the felled tree
can produce not only more lum.ber, but higher-grade lumber than may otherwise
result. A majority of the sawlogs produced under piecework conditions through-
out the Province are merely 16-foot sections of tree, with little thought given to
minimizing curves or other defects.
The more undesirable, but nonetheless necessary woods jobs remain undone
because the high piecework rates for cutting permit men to earn all they desire
under present income tax laws. An increase in rates for the less desirable work
will again start the ascending spiral for cutting rates.
I mention this subject again in Chapter XVI on Woods Labour. It is dis-
cussed here only because of the relative effect of piecework on the major primary
forest industries.
EMPLOYMENT PROVIDED
During 1945, some 42 pulp and paper mills in Ontario gave work to approxi-
mately 12,000 employees and paid $26,500,000 in salaries and wages.
In the same period, 1,147 licensed sawmills in the Province gave work to
approximately 7,000 employees and paid a little over $7,000,000 in wages and
salaries. Sawmills in Ontario are usually operated for about six months in the
year or less, as open water is necessary for transporting the logs to m.ost of the
mills.
It is difficult to make an accurate segregation of the data on the different
industries carrying on woods operations in Ontario. In 1945-46 they collectively
employed upwards of 29,000 seasonal workers, practically all males. Up till
July, 1946, many prisoners-of-war were included in this figure. Wages paid
amounted to roughly $44,000,000 for the season (brief of Ontario Forest Industries
Association). In addition, some thousands (estimate 7,000 — brief of Canadian
Pulp and Paper Association) were employed on private lands producing pulpwood
valued at $1 1,000,000 for domestic mills and export.
In addition to these primary industries, there are secondary industries with
nearly 2,000 plants using pulp or paper or lumber as the primary raw material
and, though some of these would continue in operation whether or not their
primary industries within the Province were closed, it is safe to say that the vast
majority are in Ontario because of the supplies of local raw material available.
These secondary industries provide work for upwards of 51,000 men and women
and their payrolls approximate $75,000,000. Secondary industries using wood
[34 1
range from establishments manufacturing furniture to those producing coffins,
tool handles, fruit baskets and even stepladders; those utilizing pulp or paper
cover the field from printing and book binding to the manufacture of pie plates.
Furniture establishments alone number 208, employ 7,842 men and women with
an annual payroll of over $1 1,300,000 and turn out products worth $29,000,000.
Summary of Employment
Primary Industries
19,000 employees— payrolls $ 33,500,000
Woods Operations
29,500 employees payrolls 44,000,000
(seasonal)
Secondary Industries
5 1 .000 employees— payrolls 75.000,000
99,500 $152,500,000
EFFECT ON AGRICULTURE
Not only do the primary forest industries offer healthy and gainful employ-
ment in the woods to spare off-season farm labor, but they purchase large quanti-
ties of farm produce. This amounts to about $16,000,000 (Ontario Forest Indus-
tries Association brief) in a normal year and includes fresh and canned meats
and vegetables, flour, butter, lard, hay and oats, etc.
EFFECT ON HYDRO DEVELOPMENT, TRANSPORTATION
AND INDUSTRY
The primary forest industries are larger users of hydro-electric power in the
Province than any other group, spending roughly $4,000,000 for that purpose.
They pay transportation systems tens of millions of dollars, which constitute
a very considerable proportion of the railway revenue, and it goes without saying
that their purchases of machinery, chemicals, mill supplies and fuel are similarly
impressive.
If. by any mischance, these tremendous forest industries should be seriously
curtailed, it can readily be seen that within the industry many thousands of
employees and their dependents, as well as many more thousands in agriculture,
transportation, hydro and industry generally, will suffer severely.
CAPITAL EXPENDITURES AND FIXED CHARGES
Pulp and paper mills require tremendous capital expenditures before they
can produce a single ton of pulp. They are often located far from centres of
population and whole towns, with all amenities, have to be constructed, in addi-
tion to the mills. An expenditure of $50,000 to $60,000 or more per ton of daily
capacity is not unusual (400-ton mill $20,000,000 to $25,000,000) before it is
possible to produce pulp or paper. The investment in mills forms one of the
fundamental differences between pulp and paper operations and lumber opera-
tions. In the former case, the cost of the mill far outweighs the costs of the
135 1
limits and the facilities for producing wood. In the latter case, the investment in
limits and facilities to deliver logs may easily be greater than the cost of the mill.
The factor of mill investment has a profound effect on the probable course of
action of the two industries when production falls to a low ebb. The pulp and
paper mill has such a burden of capital investment that, with high fixed charges
for taxes, interest on securities, maintenance and depreciation, it will probably
continue to operate until the loss per ton of production exceeds the fixed charges.
This was exemplified during the depression years in the early thirties. The only
mills to close were those which were units in a group where production could be
transferred to and carried on more cheaply by other mills in the same group.
The single mill, once established, cannot afford to close until unit losses exceed
unit fixed charges.
On the other hand a sawmill, not having so much overhead, can reduce
production drastically and even close down completely for a season, without
necessarily going into bankruptcy. Such action, however, is most undesirable
and causes a grave dislocation in the affairs of all concerned, particularly the
wage earner.
A comparison of the trends in the two major primary forest industries in
Ontario is interesting and possibly instructive. The pulp and paper industry
will be dealt with first.
PULP AND PAPER INDUSTRY
In 1917, the total production of the pulp and paper industry was 873,043
tons. By 1941 this had reached a peak of 2,861 ,958 tons and in 1945 was 2,736,478
tons. The number of establishments reached a peak of 45 in 1926 but had
dropped to 42 in 1946.
In 1920, Ontario was producing 33.4% of all pulp and 46.2% of all paper
in Canada, but in 1944 the corresponding figures were 25.0% and 28.5%, indicat-
ing that production in other provinces has overcome the early lead established by
the mills in Ontario. Development of a large export trade in pulpwood has
undoubtedly had a share in this failure of Ontario to hold its dominant manu-
facturing position.
In 1920, the average output of pulp and paper per mill in Ontario was
approximately the same as the average for the Dominion. By 1 945, the combined
output of pulp and paper per mill in Ontario was roughly 68,400 tons a year as
against 91,400 tons for the Dominion. The average annual production per
employee in Ontario mills was 234 tons compared to 249 tons for all the mills of
the Dominion. Earnings of employees in Ontario averaged $2,051 compared to
$2,012 for the Dominion. Wages per ton of production (pulp and paper mills
combined) were $8.78 as against the national figure of $8.08.
The wood costs of Ontario mills are, on the average, higher than those of
Quebec mills. To a limited extent this may be due to the heavy transportation
charges on wood coming in from other provinces. A comparison of the cost of
wood delivered at Ontario mills in 1945 with the cost of wood delivered at Quebec
mills in the same year indicates a differential of more than $1.50 per cord in
favour of that delivered to Quebec mills. In past years I have had good oppor-
tunities to observe operating conditions, particularly the factors of roughness of
terrain, difficulties of providing forest roads, water storage and improvements,
[361
Spruce bull 16 inches in diameter found under a brush heap where it was hidden because it was too
heavy to handle. (Putpwood exporting company operation.)
in all parts of Quebec. My past summer's study in Ontario's forests has con-
vmced me that, in comparison, the average conditions are more favourable in
Ontario. Ontario's wood should arrive at its mills more cheaply than wood
produced in Quebec for her mills, and the Dominion Bureau of Statistics figures
indicate that a differential in favour of Ontario of $1.10 per cord did, in fact,
exist in the early 1930's.
In my opinion, the extra costs are due to the less efficient operating methods,
resulting mainly from the piecework system widely used. This system of cutting
wood in eight-foot bolts requires the clearing of strip-roads approximately 660
feet in length and 12 to 20 feet in width for each acre stripped. These roads are
in addition to all main hauling roads and constitute, themselves, a most expensive
item in production costs. Strip-roads parallel one another about 60 to 70 feet
apart, so that the woodsman can carry logs to the piles beside them. Carrying
logs 10-12 inches or more in diameter and 8 feet 4 inches long, in a worker's
arms or on his shoulder, is most uneconomic and could in most cases be per-
formed much more cheaply by mechanical power or by horses. With piece-
workers earning well over $1.00 per hour, manual labour of this nature is diffi-
cult to justify. It is back-breaking labour for the individual; consequently
many large bolts are buried out of sight under brush heaps because of their
weight.
The clearing of the roads necessitates deep piles of brush between them,
which seriously interfere with advance-reproduction growth.
[371
On both silvicultural and humanitarian grounds, I strongly recommend
abandonment of the cutting of eight-foot pulpwood. If ground is too
soft for mechnical equipment or horses, then I recommend that bolts
be not longer than four feet, with narrower strip-roads more widely
spaced. Smaller areas may be left until frost has solidified the swamps.
Dues on balsam and jack pine pulpwood are much lower than in Quebec or
New Brunswick. Those applying to spruce vary very widely but are, in general,
comparable with those of Quebec, although lower than those applied in New
Brunswick.
GOVERNMENT CHARGES FOR PULPWOOD
iH! 1 .,M
^^1
^mIttiI
t k
SPRUCE
EACH r::, -«ll REPRESENTS
IO<JOF STUMPAOE CHARGES
(DUES,BONUS6rOTHEP-
DIRECT CHARGES)
POPLAR.
EACH REPRESENTS
lO*; OF CAHRVING CHARGES
(GROUND RENT, FIRE.
PROTECTION, ETC.)
Comparison of costs of pulpwood slumpage in three eastern provinces for the season 1944-45.
Quebec charges the same dues on balsam and jack pine as on spruce, as the
accompanying diagram shows, and the utilization of the first two is much higher
in proportion to spruce than in Ontario.
The pulp and paper industry in Ontario has not advanced nearly as far as
elsewhere in Canada in the utilization of species other than spruce. I believe this
has been due to the relatively low carr}ing charges on limits, as well as the lack
of a down-payment at the time they are leased; to the relatively low stumpage
rates on spruce, which is undoubtedly the most desirable species from the stand-
point of the pulp and paper maker (except in kraft mills where jack pine is
preferred); and to the piecework system in general use which renders higher
returns to the individual in the black-spruce-swamp stands where trees are of
uniform size and rarely very large.
Dominion Bureau of Statistics data indicate that in the manufacture of
groundwood, the ratio of jack pine to other species used in Quebec is more than
two-and-a-half times that in Ontario.
Ontario will probably always have higher freight charges on pulp and paper
than her neighbour, Quebec, but with her more favourable terrain and soil, and
distribution of railways, she should be able to overcome the handicap of the freight
differential.
1 am firmly convinced that, particularly in the western portion of the
Province, though not confined entirely to that region, forest operators generally
do not build sufficient control dams to utilize the potential log-carrying capacity
38
of their streams. When dams are built, flooded areas are rarely cleared — except
in isolated cases — but much boom timber is used to provide channels through the
trees and debris which should have been removed. The cost and wasted effort
of placing boom timber, with the added cost of driving logs under the circum-
stances, helps considerably in keeping Ontario's wood costs above those of
Quebec. This is indicated by the annual quantities of boom timber cut, most of
which is used for the purpose mentioned. For the past four years, the annual
cut of boom timber has averaged 6,000,000 feet, equivalent to three to four
hundred carloads of lumber.
ONTARIO FOREST UTILIZATION
BALSAM '/2%-
SPRUCE 63%
SPRUCE 36/j%
PROPORTIONS OF PROPORTIONS OF PROPORTIONS OF
PULPWOOD CUT STANDING TIMBER* SAWLOGS CUT
•estimate based on- spruce 4."^UP, jack pine 6"^ UP, AND BALSAM 6" ^ UP (DIAMETERS).
Diagram showing the proportions in which spruce, jack pine, and balsam occur in the forest compared
with the proportions in which they are extracted for pulpwood and sawlogs.
During the period 1919-1929, Canada's total newsprint production increased
by over 1,500,000 tons, with Ontario taking a very considerable portion of the
mcrease. During the same period, the United States increased her newsprint
production by only 40,000 tons. From 1926 onward, conversion of newsprint
productive-capacity in the United States to other more profitable lines was
actively pursued, while the cheaper and more highly competitive lines were left
to the Canadian mills. This trend was particularly noticeable in the Lake States
where, during the fourteen years ending 1935, the increase in the production
of papers, other than newsprint, was 1,023,000 tons, while in the same period,
newsprint production dropped by 137,000 tons.
39
The Lake States mills operate to a very considerable extent on Canadian
wood, yet their products are "protected by tariff from low-cost producers, such as
the Canadian and Scandinavian". The quotation is from a speech of Mr. A. R.
Graustein, when President of the International Paper Company, giving the
reason why United States mills had turned away from newsprint to other kinds
of paper. In 1943, ten times more wood was imported into the Lake States than
in 1919, compared with an increase of one-sixth in the consumption of their own
home-grown wood.
Canadian fine-paper mills compete in Canada with paper made in the United
States, possibly from wood exported from Canada. As evidence of this, I point
to the fact that the first letterheads of this Commission, purchased on the open
market in Toronto, were printed on United States bond paper. While I appre-
ciate the complexity of tariff structures and know that they are matters for
national, not provincial, negotiation or action, I believe that a joint study of the
matter, with federal, provincial and industrial interests collaborating, might well
prove of lasting benefit to the Canadian interests concerned.
I have found no instance of the use of sawmill slabs, trimmings and edgings
in Ontario's pulp mills, though this is already the practice outside the Province.
If sawmill slabs were collected and funnelled to pulp mills, the drain on limits
would be eased to a considerable extent. I estimate the potential supply of
pulpwood from this source at 65,000 cords of spruce and balsam, and upwards of
80,000 cords of jack pine. Not all of this can be economically delivered at the
present time, but much of it could.
Some mills in Ontario have examined the possibilities of using poplar for
pulpwood and its greater use for this purpose should be encouraged. Little
development work has been done toward the utilization for pulpwood of hard-
woods other than poplar, though the potential supplies of hardwood in Southern
Ontario and the Algoma Region are tremendous.
Ontario mills are to be commended for pioneering in the development of by-
products from sulphite liquor. They are leaders, amongst Canada's mills, in the
installation of plants for the production of vanillin, plastics and industrial alcohol,
and one plant also produces yeast.
In view of the cost and at times the uncertainty of coal supplies, it is remark-
able that investigations have not been more actively and energetically pursued
leading to the development of a fuel from waste liquor resulting from chemical
pulps. This would be a fruitful field in which to seek economy because of central
Canada's lack of coal and its dependence on the United States as its main source
of fuel.
The almost complete divorce which exists between sawmills, on the one
hand, and pulp and paper mills on the other, is costly and wasteful of both money
and manpower. The final chapter of this report will suggest a remedy for this ill.
SAWMILLS
A completely different set of conditions from those applying to the pulp and
paper industry affects timber markets and sales. In addition, the Canadian
section of the lumber industry has never employed as many technically trained
personnel, on either woods or sawmill operations, as the pulp and paper group.
1401
The difference in the approach to woods and mill problems is probably
because the sawmilling industry was active for nearly a century before the younger
industry, and tradition has affected its actions to a much greater extent.
The lumber industry in Upper Canada commenced in a modest way in the
first half of the last century, being then confined to the lower Ottawa Valley
and a fringe along the front of Lakes Ontario and Erie. It expanded rapidly
up the Ottawa and in the latter half of the century covered Southern Ontario and
progressed up through the Parry Sound District, along the north shore of Lake
Huron to Sault Ste. Marie. This rapid development was due in large part to
the settlement and building up of the mid-western portion of the United States,
with export from Eastern Ontario to the United Kingdom always a good sound
backlog. Around the turn of the century, the vast Minnesota lumbering opera-
tions projected themselves across the border to the white pine and red pine forests
west of the Great Lakes. From there they ate their way eastward toward the
Great Lakes, on the lower stretches of which the larger units of the Canadian
industry were even then closing for lack of timber.
Wherever the lumber industry has gone, the story has varied little. With
the notable exception of a couple of the older firms in the Ottawa Valley who have
continued in business for a century or more, few lumber organizations have ever
lasted beyond a couple of generations. Methods then used were incredibly
wasteful when viewed from today's standpoint and they generally brought
devastation to the areas cut over, so that now only a handful remains of what
were some of the most valuable pine forests on the continent.
Settlement invariably followed in the wake of lumber operations and the
fires set by our ancesters in clearing land, much of which later experience indi-
cates should never have been cleared, completed the ruin of the residual forests
left after the white pine and red pine had been taken. The vast programme of
reforestation and soil and stream rehabilitation, which is recommended in later
chapters of this report, had its genesis in the operations of these pioneer lumber-
men and settlers. To replace the forests then destroyed and to rehabilitate
the soil is a long and costly process which must be undertaken by the grand-
children and great-grandchildren of those who benefited from the mistakes in the
past. We must guard against handing on our remaining forests to our descend-
ants in a similar condition.
There are a total of 1,147 sawmills of various sizes licensed in Ontario.
This number varies from year to year and in addition there are some small
mills which operate only a few days during the season and do not undergo the
formality of obtaining a license.
The sawmill output in 1944 was 585,237,000 feet board measure, which is
about one-third of the annual production in the early days of the century.
Mills have increased in number and decreased in size since the early days
of the century, so that the average output per mill is very little more than one-
quarter what it was then. At that, the average output per mill is about 20 per
cent more than that of the remainder of Eastern Canada. (British Columbia
conditions are not considered comparable.) Sawmill employees in Ontario
produce about nine per cent less per man-day than the average for the remainder
of the Eastern Provinces, but the product is worth 14 per cent more. The
reason for lower production and higher value lies chiefly in the greater percentage
of white pine and red pine in Ontario's cut.
1411
This Province has not held its former place in the national picture. In
1908, Ontario produced 92 per cent as much lumber as all the other Canadian
Provinces combined, excluding British Columbia. In 1944, the corresponding
percentage was 31.4 per cent. If we are to have a balanced forest economy, this
decline must be checked and the trend reversed.
A significant and healthy trend in sawmill production in Ontario has been
the increased use of jack pine. Statistics for 1944 indicate 103,161,000 f.b.m.
used. This was exceeded by only one species, white pine. I am convinced
that the sawmill industry in Ontario, for several decades, will depend to an
increasing extent on jack pine, with poplar usage also expanding to a degree
not yet generally appreciated. White pine and red pine should again overtake
and surpass the other species in utility in from forty to fifty years, if given the
chance they deserve, including protection from cutting before they have reached
economic maturity, a condition now seriously violated. For the present, we
can only expect a downward curve of white pine and red pine production as the
few remaining stands continue to be overcut in the effort to supply the demand
for these very valuable species.
Jack pine has not received the favourable advertising its qualities justify.
In strength and quality it is little, if at all, inferior to spruce, and in appearance
I believe it surpasses that species. There appears to be a tendency, however,
on the part of industry to be apologetic for its use, a tendency which must be
eradicated. Poplar, too, is eminently suitable for a great many purposes for
which the conifer species are now demanded. Operators in this Province, who
are failing to utilize and sell these two species to their maximum possible capacity,
are assisting in preparing an early grave for the unnecessary interment of their
industry.
Spruce, birch and maple production has remained fairly constant during
the past quarter century or more. They form the other major species cut in
addition to white pine, red pine and jack pine. The sawing of poplar has not
yet become a major element in our Provincial lumber production. A comparison
of the average cut for five-year periods in three representative periods is worthy
of note.
Average for Average for Average for
Five Years Five Years Five Years
1908-1912 1932-1936 1938-1942
(Depression)
All conifers 1 ,334,069 M f.b.m. 25 1 ,306 M f.b.m. 457,382 M f.b.m.
All hardwoods ... . 152,084 " 52,390 " 93,714
,486.153 " 303,696 " 551,096
IMPORTS OF LUMBER
During the period 1928-1938, a bi-annual survey made gave evidence that
Ontario was even then bringing in 150,000 M f.b.m. of lumber per annum more
than was being shipped out. The survey was discontinued in 1938, but frag-
mentary data available indicate that imports have not lessened and that, if
more abundant supplies from outside were available, the quantity would be
considerably greater.
[42 1
Because of Ontario's large population and high degree of industrial develop-
ment, it consumes a great deal of lumber, but it does not produce nearly as much
as it might or should. It is illogical that the Province of Ontario, possessing
nearly two-fifths of all the accessible saw-timber east of the Rocky Mountains,
does not meet its own requirements of lumber and must depend upon its neigh-
bours for raw material for its industries. In the last year for which accurate
statistics are available, only Prince Edward Island, Manitoba and Saskatchewan
were further from meeting their own requirements of lumber than Ontario, and
these three provinces combined have scarcely more than one-tenth of the saw-
timber resources of Ontario. The fact that a considerable volume of lumber is
shipped out of Ontario should not be permitted to cloud the issue. The cardinal
fact is that the volume of lumber brought into the Province greatly exceeds the
quantity shipped out. We shall probably continue to export a considerable
volume of lumber, and we must of necessity import some species not native to
this Province. But the net balance must be improved if a healthy condition
is to be achieved. The present shortage of lumber in this Province is evidence
of that need. Other provinces are not anxious to make up our lumber deficiency
when other more lucrative markets are open, and we are unable to show any
valid reason why they should. We have the demand for lumber, we have the
necessary raw material to meet that demand, even more than meet it, but a
basic weakness exists in the industry which converts the raw material into the
product needed. It is felt that a re-orientation of Government policy could do
much to maintain and develop the lumber industry in line with the needs of
the people of this Province. Ontario's performance has no parallel in any other
province, though its opportunities are as great. The decline in lumber produc-
tion cannot be explained by suggesting that what we have lost in that industry
we have more than made up in an expanded pulp and paper industry. This
argument fails to convince because in other parts of the country, proportionately
no more richly endowed with forests, the pulp and paper industry has expanded
even faster than in Ontario, while at the same time lumber production has been
maintained or increased, without apparently any greater damage to their forests.
The reason is that in Ontario we lack a balanced policy with respect to our forest
industries.
It is submitted that too many of Ontario's sawlogs are located on pulpwood
concessions, both domestic and export. If the lumber industry is to continue
to exist, these logs must be diverted to it, instead of being converted to pulp
and paper for which smaller logs serve equally well.
It is true that many sawmill operators did not provide themselves with
limits while they were available and are largely to blame for the situation in
which they now find themselves. It is the citizens of Ontario, however, who
will be the chief sufferers if we permit these improvident lumbermen to be
eliminated by timber starvation. It is extremely doubtful if the forests of Quebec
and New Brunswick, in addition to supplying their traditional markets in Great
Britain and the Eastern Seaboard of the United States, can make up for the
production of the Ontario mills, which will run out of local lumber during the
next twenty-five years. In addition the threat of increased freight rates is even
now upon us, and such increases would make the price of lumber supplied from
outside the Province less attractive than at present.
Lumber for housing should be made as cheap and abundant as possible.
Lumber also forms one of the largest single items of expense in the operation of
our vast mining industry, which now uses about 70,000 M feet board measure
[43 1
Logs intended for the manufacture of lumber. The diameters of the logs mai/ he estimated by com-
parison with the hats in the foreground. Some of the smaller logs will yield the Province only two or
three cents in stumpage and should have been scaled in cubic measure and used for mak.ing pulp.
Spruce up to 29 inches in diameter cut for pulpwood, but more suitable for sawlogs. The hat indicates the size
of the logs. {Domestic company operation.)
per annum. These are but two of the many urgent needs for lumber stressed
at pubhc hearings of the Commission.
I therefore argue that we must maintain the lumber industry of Ontario,
even though it means a changed viewpoint on the part of pulpwood operators.
This should not be achieved by closing a majority of existing sawmills and
opening up new ones which might be appendages of the pulp and paper industry.
I believe that, in general, the continuity of present mills and their dependent
communities should be assured and that Provincial interests will best be served
by so doing, rather than by the development of new mills. Rescue of the lumber
industry from its precarious position implies an obligation on its part to eliminate
waste, both in woods and mills and to co-operate with the pulp and paper in-
dustry in providing pulpwood as a by-product.
A good reason for the continuance of existing units in the lumber trade is
the complexity of the lumber market. There are several markets and uses into
which the products of any log must be channelled. Any sudden shift in manu-
facturing and marketing processes might have far-reaching and detrimental
results in the rather delicately balanced existing trade methods.
The wholesale trade co-ordinates the product of the hundreds of mills and
fits it for market. It furnishes the real and, for many firms, the only sales
service available to locate home markets and markets in the United States,
Great Britain or elsewhere. Under present conditions this might not appear
important, but under normal trade conditions it is most necessary.
The retail trade maintains establishments for further processing of lumber
in all the major centres of population and performs a very vital service to the
public. They funnel into the hands of the public the portion of sawmill output
which the public can absorb. Acting in conjunction with manufacturers of
secondary products, as well as with the export trade, they are a powerful influ-
ence in providing full utilization of that portion of the log which reaches the
market.
Few people outside the trade realize that the effects of wartime controls
are likely to persist even after the controls have been removed. Nobody should
deny the necessity for drastic action in wartime, but I believe that the applica-
tion of such measures implies an obligation to lend a hand, if necessary, toward
remedying the trade dislocations so engendered. To illustrate my point, I quote
the following example. In normal times, British Columbia fir was shipped to
Eastern Canada for flooring, but wartime needs properly diverted it elsewhere.
Eastern Canada's hardwood flooring producers had developed a creditable export
trade which proved a godsend in depression years but, later, wartime output
was necessarily channelled into the domestic field. With a return of normal
trading conditions, British Columbia flooring will probably reappear as a com-
petitor, but the export field may not easily be regained.
The lack of a sufficiently wide price range for the different grades and species
of lumber has been the occasion of widespread complaint by operators across the
Province. Although the subject was not stressed at public hearings, I am in-
clined to believe there is some justification for the contention that many dealers,
with the knowledge of customers, invoiced their lumber as being several grades
above the actual quality, in order to meet black market competition and achieve
profits under the existing piecework rates. Certainly some smaller mills visited
gave little thought to grading. The result of years of effort to establish proper
[45 1
grading practices has largely been undone and, as a result, Canadian lumber will
suffer in the export market.
Restrictions on exportation, the fixing of price ceilings, an income tax
which, beyond a certain level of income approached confiscation, and other
restrictive measures have all combined to discourage lumber production to a
very grave extent, especially by the most responsible element in the trade. A
spirit of patriotism can make the unworkable work in wartime, but such is not
so today. This Commission has been told of instances of lumbermen actually
curtailing their operations in the face of the present urgent demand for lumber.
The reason given is a simple one. A large cut involves substantially more risk
because of the greater inventory and greater capital outlay entailed, but under
present conditions it offers the prospect of but little more net gain than does a
small one, even if market conditions and prices should remain stable. Who, in
these circumstances, would not follow the prudent course?
I am not an advocate of the immediate abandonment of all controls, indeed
the matter of federal controls does not fall within the scope of this inquiry; but
I believe I should draw attention to the wide discrepancy which exists between
the apparent intent of certain federal regulations and the results they are achiev-
ing. By not doing so I should fail to show the provincial picture in its proper
perspective. I believe that until this gap is closed and until the production of
lumber on a large scale is restored as a reasonable risk, the best efforts of the
Provincial Government to stimulate the manufacture of much-needed lumber
can produce only very limited results for the time being. The stimulus should
be given, however, and given without delay, as a necessary step in a long-term
policy.
One of the most likely methods of increasing the profits of sawmills generally
and at the same time lowering the cost of lumber to the public, lies in use being
made of those parts of the logs now wasted. As an example of the need of
closer utilization, an analysis of the Dominion Bureau of Statistics sawmill data
for 1943 is presented below. Volumes have all been converted to cubic feet of
solid wood.
RAW MATERIALS
VOLIME
V
XLUE
Cubic feet
Per cent
of total
Per cubic
foot
Total
Logs and bolts used
134.000,000
100
$0.10
$13,526,633
PRODUCTS
Volume
V
\LUE
Cubic feet
Per cent
of total
1
Per cubic
foot
Total
Lumber
Ties, shingles, pulpwood, etc
45,500,000
7,500.000
81,000,000
34
51.,
60^2
$0.47
0.20
0.05
$21,261,613
1,516,336
Secondary products and waste
3,954,529
134.000,000
100
0.20
26.732.478
46
As the cost of the raw material at the mill was roughly 10 cents per cubic
foot, it is readily seen that three-fifths of the raw material handled was disposed
of at half its cost. No clearer evidence could be found of the necessity for re-
search aimed at the reduction of sawmill waste. It is possible that some opera-
tors may argue that the value of all secondary products and waste has not been
reported, but another million dollars added to the values shown above would
have no significant bearing on the conclusion reached.
FROM 10,000 CUBIC FEET OF LOGS 1^ BOLTS COME
3.400 CUBIC FEET OF
LUM BE.R.
55 0 CUBIC FEET OF
OTHER PRIMARY PRODUCTS
6.050 CUBIC FEET OF
SECONDARY PRODUCTS ^REFUSE
VALUE 47.
PEBCU FT ''V
COST OF LOGS ABOUT ONEFIFTH
VALUE OF FINISHED PRODUCTS
COST OF LOGS ABOUT HALF
VALUE OF FINISHED PRODUCTS
COSTOF LOGS ABOUT DOUBLE.
VALUE OF FINISHED PRODUCTS
Chart indicating the unnecessarily high proportion of refuse and low-value products in the sawmill
industry together with the comparative costs and values of the several classes of products.
During the past season 1 have measured the length of many logs on roll-
ways and I have rarely found any log shorter than the measurement of its length
class, plus the tolerance allowed. On the other hand, a large percentage of the
logs measured were overlength, i.e. a nominal 16-foot log with an overlength
tolerance of six inches would often measure 17 feet or more. In the sawmill
system of Eastern Canada, this would be trimmed to 16 feet, a loss of six per
cent on every board sawn from the log. This overlength tolerance should be
closely watched by scalers and all logs exceeding it should be tallied in the next
higher length-class.
Large improvements in the yield from sawmill operations are attainable by
the operator who will study details of market needs and cut more closely to the
sizes, specifications and grades to meet those needs. Stress has always been
placed on quantity production of lumber in standard widths, lengths and thick-
nesses. There are a few operators in the Province who have discarded the
traditional methods of operation and are receiving big benefits from studying
the needs of special customers and integrating their operations with those needs.
The end-product of any of the sawmill group who are similarly clear-sighed may
equal or surpass the returns per cubic unit now made on all but the highest
grades of pulp.
It is not at all unusual to see the slabs of a mill left to disintegrate or to be
carted off as firewood, in spite of the fact that another mill is set up in the same
area to produce box shooks, basket bottoms, etc., from the same type of material.
A large box factory, surrounded by sawmills, cuts up into little pieces and utilizes
top grade white pine and red pine, while the slabs of similar grades from the
47
other mills are shipped out as firewood or other low-income products. Poplar,
balsam and jack pine, up to the present considered inferior species, could be
made to supplant higher-priced species for many uses, at lower costs and higher
returns to the producer than the species used. The co-operative collection and
disposal of the low-grade material and waste of groups of mills offer a useful
subject for study. A vast field for co-operation and integration in such matters
remains virtually uncultivated.
I believe also that the day is upon us when sawmills should discard the
practice of edging boards to even inches only, and trimming only to even feet
of length. At what better time than in the present sellers' market could the
trade get rid of this rather unnecessary waste which may range from 10 per
cent to 20 per cent or more of the measurement of the board?
Before leaving this topic of industrial waste, however, 1 should perhaps say
a word about waste in the pulp and paper industry, lest I leave the impression
that only the lumber industry is guilty of incomplete utilization. The pulp
and paper industry annually wastes thousands of cords of wood in the form of
short ends of logs, slivers or unnecessary sawdust, all of which are used only
as fuel to produce steam. Hundreds of tons of various substances are ejected
into the sewers by chemical-pulp mills daily in forms which are capable of being
converted into useful products such as sugar, yeast, alcohol, lime, acetic acid,
etc., to say nothing of the products from lignin, a substance which forms a
substantial part of wood and which is not generally utilized.
COMPARISON OF FOREST INDUSTRIES
The remarkable growth in the pulp and paper industry of Ontario and the
simultaneous and almost equally remarkable decline in the lumber industry are
depicted in the diagram opposite. Although, for convenience, production of lum-
ber, pulp and paper is shown for only four years out of the past forty, the dia-
gram IS a fair representation of the long-term trends.
There has been a tendency to look upon the value of the end-product of
the pulp and paper industry and that of the lumber industry as a reasonable
comparison of their economic values to the Province. I am convinced that such
a comparison misses many important features which radically affect the situa-
tion and which must not be neglected.
Analyzing the Dominion Bureau statistics for 1943 and converting wood
volumes to cubic feet in all cases, the following figures emerge:
A cubic foot of wood used by the pulp and paper industry results in products
worth 63 cents.
If converted to lumber, the figure is 20 cents, and if utilized by the wood-
using industries (other than pulp and paper), 49 cents.
In practically all cases lumbermen pay higher ground rents and, in many
cases, higher stumpage rates per cubic foot of wood of all species than is paid
by the pulp and paper industries. (See curves on page 163). It is true that
this fact has been beclouded for years by the Doyle rule, but it is a fact none-
theless. Some adjustment in this matter is overdue if all groups are to receive
impartial treatment.
1481
TRENDS IN ONTARIO PRODUCTION
of
LUMBER, PULP AND PAPER.
th
k
iv
1 %
d J
:'l
Li LI
HjjM**;''
1908 1917 1932 1944 1908 1917 1932 1944 1908 191/ 1932 1944
LUMBER. PULP PAPER.
EACH SYMBOL REPRESENTS 150,0 0 0 M.f Km. O F
LUMBER OR 150,OOOTONS OF PULP OR PAPED.:
Trends in production oj lumber, pulp and paper in Ontario since 1908.
49
In the same year, the wages and salaries paid per cubic foot of wood used
by the various industries were as follows:
Pulp and paper. 13 cents
Lumber 05
Wood-using industries 16
For each dollar received for the products, the industries paid out in wages:
Pulp and paper 20'/2 cents
Sawmills 26
Wood-using industries 321/2
This latter tabulation modifies to some extent the idea that the end-pro-
duct is all important. It may not appeal to those who believe that a dollar
gained through the action of other dollars is more important than a dollar which
reaches the pocket of the workman involved.
Pulp and paper mills tend to concentrate in areas where labour and power
are available, but the personnel employed by and dependent upon the lumber
industry is widely scattered in hundreds of small communities across the Prov-
ince (see Map No. 1 I). This I believe to be beneficial as it is in direct opposition
to so many other influences which tend to clog our towns and cities, leaving the
hinterland without the supply centres necessary for their healthy developm.ent.
Lumber is now sadly needed in the repair and building of homes, for repairs
to and the replacement of farm buildings, for railway ties, telephone and hydro
poles, furniture, etc. I therefore recommend that government policy be
inclined in favour of the lumber industry, rather than against it, as
would appear from stumpage rates, ground rents and limit allocations
of the past decade.
50
CHAPTER V
Crown Lands
ORIGIN OF CROWN LANDS SYSTEM
As indicated in Chapter I of this report, the establishment of Crown lands
in Ontario had its origin in the needs of the Royal Navy, and during the early
days of the Colony, all timber suitable for such needs was reserved for the Crown.
Lands necessary for agriculture, settlement, industry and recreation were
alienated from the Crown, from time to time, as needs arose. The settler seeking
land could obtain it in areas designated for settlement and after fulfilling certain
obligations, such as the clearing of lands, the erection of buildings, etc., he could
obtain title to his land by means of Letters Patent.
Until recent times, the Crown retained the rights to red pine and white
pine on lands so patented, but legislation passed at the 1946 session of the Legis-
lature allows the holder of lands with such reservations to obtain rights to the
timber; free if he lives on the lot in question or within ten miles of it, and on
very advantageous terms if it is situated more than ten miles from his domicile.
RIGHTS TO CUT TIMBER
Rights to cut timber on Crown lands fall under four headings:
(1) Licenses
(2) Agreements
(3) Permissions
(4) Permits
Forests already under license or agreement are indicated on Map No. 8. The
number of unleased areas interspersed among the leased areas will be noticed on
this map.
Licenses
Licenses are granted as the result of the sale of timber by auction. They
are renewable yearly, provided the holder has complied with the laws and regu-
lations relating to such operations.
Licenses granted prior to 1892 generally permitted the cutting of all species
of timber on the area involved and stumpage rates applying to these licenses
remain essentially the same as at the time the licenses were granted. The
holders of such licenses have enjoyed very favourable stumpage rates over a
long period of years. (In 1898 the right to cut species other than red pine and
white pine was cancelled on limits within the boundaries of Algonquin Park,
even though these licenses had been granted prior to 1892.)
Licenses granted since 1892 include only the specific species mentioned in
the license. In addition to the "Crown Dues", as the earlier stumpage rates
[51]
were called, they normally provide for a "Bonus", and sometimes include a
"Bid" above the bonus.
The practice of selling timber by auction has not always been to the best
advantage of the individual or the Government. A very high bid places the
license holder in a precarious position in times of low prices. His most likely
course is to stop cutting the high-priced stumpage during depression times,
causing unemployment and distress just at the time when employment is most
needed.
Bidding for timber under licenses and permits has created a wide range of
stumpage rates, as over optimism during boom periods or other causes (including
a dog-in-the-manger attitude and ordinary spite) may motivate a bidder to offer
rates which are not economically sound in normal times. It has been claimed
that some companies wishing to dominate an area have made bids far above the
possibility of normal economic utilization on species they did not require. The
result was that, in some cases, the timber in question was denied to other oper-
ators and left a prey to fire and insects, with the Province losing employment
and stumpage revenue. As an example of wide ranges, rates in this Province
for red pine and white pine vary from $2.50 per thousand feet board measure,
on old licenses in the Ottawa Valley, to $25.75 per thousand board feet on small
areas in the Port Arthur District. Little, if any, of the material subject to the
higher stumpage rates will be cut except during boom times.
A chart indicating the average rates in the various districts is shown on the
next page and it will be noted that there are wide ranges for most of the species,
with white pine and red pine showing the greatest variations.
Ground rent at $5.00 per square mile and fire protection charges at $6.40
per square mile are normally charged each year on the areas under license.
Agreements
This term applies to instruments granting Crown lands under contracts
negotiated between the Government and individuals or corporations and large
areas are usually involved, although there are areas as small as 30 square miles
included in the group. Agreements cover a wide range of conditions, sometimes
requiring the building of a new mill or the employment of specified numbers of
men. Some agreements carry export rights for all or a portion of the wood on
the area and some do not include rights to cut all species.
Fire protection charges are usually levied at $6.40 per square mile on the
full area, or at least on a substantial portion, which is deemed to be the full
area for the purpose of the contract. Ground rent on areas covered by agree-
ments is levied at widely varying rates. It may be said, however, that the basic
formula for fixing rates is that pulpwood consumed in Canada incurs no charge
for ground rent, while pulpwood exported incurs a charge equivalent to $5.00
per square mile on that proportion of the limit area which the amount of wood
exported bears to the total amount taken from the limit in any given year.
There are many exceptions to this general rule, however, the most important
one being the charging of ground rent at approximately 50 cents per square mile
per year to those Canadian manufacturers of pulp and paper who have the
right to cut all classes of timber on their limits.
In general, the contracts or agreements so written are a tribute to the bar-
gaining capacity of the interests who have obtained the cutting rights. Whether
1521
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Diagram showing average croLOn revenue per thousand board feet (Doyle log-rule) for sawlogs by Forest
Districts in the season 1945-46. Note the many marked inconsistencies.
53
or not they have proven or, in the final analysis, are likely to prove sound bar-
gains on the part of the Province, will be discussed in the chapter dealing with
Timber Management.
ermissions
This is a term applied to rights to cut timber from Crown lands in special
cases where an agreement or license is not in effect. Permissions may be granted
because negotiations leading up to a contract are under way but have not been
completed. In some instances, substantial quantities of pulpwood are involved
and the wood cut may be exported.
Permits
Permits are issued by District Offices for small quantities of timber where
the stumpage value does not exceed $500, and may be issued by the District
Office without reference to Head Office. Ground rents and fire protection, when
applicable, are at the standard rates, $5.00 and $6.40 per square mile, respectively.
Areas of Crown lands operated under each of the above headings are as
follows:
( 1 ) Licenses 12,318 square miles
(2) Agreements 53,754
(3) Permissions 4,01 2*
The total area operated under the permit system is not great in comparison
with the areas operated under other forms of tenure, because it is usually only
one season's cut which is involved. Very frequently a permit does not define
any precise area, but merely grants authority to remove a specified quantity of
timber from a given locality. In addition to the areas specifically alienated
under the above classifications, the Crown holds in reserve a total area of about
1 1 ,000 square miles. These lands are held in favour of certain pulp and paper
companies which may, within a stipulated period, elect to add to their timber
holdings. Meanwhile, these areas are withdrawn from possible use by others
and return no revenue to the Crown, although the Province continues to pay the
cost of protecting them from fire.
RELEASE OF LIMIT AREAS
In Ontario, the practice of cutting over an area held under license and turn-
ing the cut-over area back to the Crown has been widely practiced, particularly
by the sawmilling group outside the Ottawa Valley. Many of the smaller saw-
mills across the Province are operating in the residual stands left by the larger
units of the industry. The original holders exploited the choice stands on their
licensed areas, but left the poorer stands. Then, without making any sub-
stantial payment, they could and did obtain other areas where a bigger profit
could be realized by further high-grading of choice stands. This has occurred
in all parts of the Province where lumbering operations have been carried out,
with the exception mentioned above. Thousands of square miles of licensed
area has been cut over and turned back to the Province.
"The total area operated under "permission" does not include those areas on which one operator
has been given a permission to cut certain classes of timber on areas already covered by
agreements with other operators.
[54 1
In other timber-producing provinces of Eastern Canada, notably New
Brunswick and Quebec, an individual or corporation cannot obtain limits with-
out a substantial down-payment, and this practice would probably have been
of great benefit if it had been adopted in Ontario.
For almost a quarter of a century, sales of timber in Quebec have required
a down-payment never less than $400.00 per square mile, with an annual ground
rent of $8.00 per square mile (reduced only for a few years in the early 1930's
when ground rent was $3.00 or $5.00), in addition to the actual cost of fire pro-
tection (including half the cost of fire fighting). This latter item usually amounts
to $8.00 to $12.00 per square mile per annum.
In Quebec, all species are included in the license, which is for one year only.
In New Brunswick, the down-payment to obtain limits has varied between
$20.00 and $75.00 or more per square mile with ground rent at $8.00 per square
mile, a bonus of $2.00 per square mile, and fire protection pegged at $3.20 per
square mile ('/2 cent per acre). Licenses are normally for 30 years but a few
large areas are under license for a 50-year period, and a large number of small
licenses are for a 10-year period.
COMPARISON OF GOVERNMENT CHARGES FOR TIMBER AND TIMBERLANDS
(for operating season 1945-46)
Ontario
Quebec
New Brunswick
Cost of acquisition of cutting rights per
square mile
Ground rent per square mile
average
range
Fire protection per square mile.
Nil
$1.50'
Nil— $5.00
$6.40
$400.00 and up
$8.00
(Single rate)
$1 1 .50 (approx.)'
(based on actual
costs)
$20.00 and up
$10.00 (including
2.00 "bonus")
(Single rate)
$3.20
STUMPAGE2
(Normal rates for sound "green" timber)
Species
Sawlogs
per M. f.b.m. log scale^
Pulpwood
per cord of unpeeled wood
Ontario''
1 New
Quebec' Bruns-
wick'^
Ontario'* Que.^,^
New
Bruns-
wick^
White pine — average. . .
range
Spruce — average. . .
range
Balsam fir — average. . .
range
Jack pine — average. . .
range
Poplar — average. . .
range
$4.20
2.50-25.75
2.45
2.00-13.50
2.05
2.00- 9.006
2.05
2.50-13.25
1.60
1.55-10.00
$1.56 $5.45
144 4 20
K44 4 JO
K44 3^90
120 2^60
1.61
1.40-4.25
1.02
.70-3.00
.48
.40-2.75
.52
.40-2.20
$1
1
1
35
35
35
85
....
$1.84
1 .84
IJ5
K20
....
^Figure for 1944-45 (latest available).
^The comparison is based on the "International I4 inch" log rule applied to the average size of
logs — each species separately — cut in Ontario. The stumpage rates are those prevailing in
each of the provinces named translated into terms of the "International" log rule. The
ranges of rates shown for Ontario are based on the "Doyle" rule.
^Figures for Ontario include "dues", "bonus", and "bid."
^Figures for Quebec include special levy of 10 cents per cord.
^The New Brunswick rates on all the species listed, except poplar, were increased considerably
in the season 1946-47.
^Approximate.
In Quebec, stumpage rates for sawlogs were increased (in effect) in 1946, and the rates for pu'p-
wood were raised in 1947.
LANDS FOR AGRICULTURE, TOWNSITES, SUMMER RESORTS, ETC.
The Department of Lands and Forest handles all transactions concerning
the granting or leasing of Crown lands for the purposes of agriculture, townsites,
summer resorts, etc. There has been a noticeable improvement in the control
of these transactions since 1941, when the late H. W. Crosby was placed in
charge of the Division dealing with lands. To him must go a major share of
the credit for eliminating, to a very considerable extent, the conditions which
over the years have laid waste hundreds of thousands, if not millions, of acres
of forest lands under the guise of assistance to settlement and to agriculture.
In reality, the timber was mined from most of these lots, sold to domestic mills
or exported, and the denuded lots allowed to revert to the Crown. Compara-
tively few of the lots in question were suitable for supporting agriculture because
of the nature of the soil and climate, and the distance from markets.
The subject of classification of lands to prevent such wastage in the future
is covered in Chapter XVIII.
REPRODUCTION
Up to the present, cutting practices on Crown lands in Ontario, as elsewhere
in Eastern Canada, have been governed by considerations of current operating
costs, rather than by the needs of a future crop of timber from the same area.
Good reproduction, when it has occurred, has always created satisfaction, but
it has been the child of chance rather than of design.
Pine in the Ottawa Valley and a majority, though not all, of the black-
spruce-swamp types in the Province, give promise of future stands commensurate
in quality and quantity to those cut. Other cut-over areas, on the average, are
reproducing to inferior species or are barren or only partially stocked.
If Ontario is to remain one of Canada's major timber-producing provinces,
this trend must be checked and practices developed and enforced which will
guarantee a future crop preferably better than, but at least as good as, the one
harvested, if such is economically feasible. Much research is needed in the
methods of cutting the different species on different sites, before such methods
assuring adequate reproduction can be recommended with a reasonable degree
of certainty. Such research should not be delayed.
RECOMMENDATIONS ON CUTTING PRACTICES
I recommend the following cutting methods which may be enforced
now and which will save much timber presently wasted:
(1) No stumps over 12 inches in height to be tolerated. There is
no adequate explanation to be given for high stumps. A stiff
penalty (five cents per inch of excess height per foot of diameter
or fraction thereof) shared by the operator and the cutter,
would cure this wastage overnight.
(2) Large tops must not be permitted. A regulation requiring that
on operations for sawlogs all trees be utilized to a top diameter
of seven inches in conifers and nine inches in hardwoods, with
limbs lopped to a diameter of four inches, would eliminate this
widespread waste. On other forest operations, tops should not
exceed four inches in diameter, with limbs lopped to three inches.
1561
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H^as/e in pulpwood culling. The most valuable parts of trees hfl in high stumps. {Domestic comoany operation.)
tT^
Waste in pulpuood culling. The most valuable parts of trees left in high slumps.
I Pulpuood-exporting company operation.)
— i
■z^-
IT
Waste in cutting sawlogs. The four stumps in this illustration are sound and measure
36 to 42 inches in height.
Brush should be spread close to the ground, to distribute the
seed remaining in cones. A stifF penalty (five cents per inch of
diameter), shared between operator and cutter and uniformly
applied, would eliminate gross waste in tops.
(3) Further penalties, such as triple stumpage rates, should be
provided and applied for all material felled but not delivered to
piles or rollways for measurement. (I believe that company
[581
Ten-inch jack, pine top wasted. \ Domestic pulp and paper company.)
Tops left on a jack, pine sawlog operation. Such wasted material would be excellent for making
k^^aft paper.
H^as/e on a sawlog operation. Abandoned jack-pine skids measuring 10^ , inches at the butts
and -/ ' 2 inches at the tops.
Woods waste. Discarded red-pine skids, 50 to 60 feet long, two of which were 13 inches in diameter
at the butt ends. {A domestic match-splint company.)
'-.v.
^•*<t-
Bad uiilizalion. A balsam lop 10 inches in diameter, 20 feel long and a spruce lop six inches in diameler,
16 feet long. {Pulpwood-exporting company operation.)
executives would be appalled if they realized the extent of lost
effort and material from this source.)
(4) Where clear-cutting methods are permitted, merchantable
trees of all species should be removed in a single operation, with
suitable penalties such as double stumpage rates on trees which
are left on areas cut over, unless they are undersize or are needed
as seed trees. Otherwise, trees which are not wind-firm will
blow down, mature trees will disappear before the next cutting
and most of the remainder will die of sunscald when the sur-
rounding trees have been removed.
(5) It is possible that a light initial cutting (30-40 per cent of the
mature trees) should be made on some sites and of some species
to open up the crown cover and permit seedlings to get estab-
lished. This could be followed by a final cutting to remove the
remainder as soon as the next crop is assured. In any event,
the rule should be established that any area cut over must be
left in a condition which promises a future crop of timber as
good as that removed. Only in this manner will the joint re-
sponsibility of the operator and the Crown be discharged.
(6) When logs are placed in "rollways" or "skidways" they are piled
on parallel poles known as skids, which often lie flat on the
ground and are frozen in place when the logs are removed. On
[61 ]
sawlog operations, these skids are usually of pulpwood species
which the operator has no right to cut. The practice of leaving
skids often applies in the case of pulpwood cut in log lengths.
Dead trees or poplar or white birch which are not usually re-
moved from the forest, would serve equally well. The aggregate
loss from skids left behind is tremendous and while some of it
is measured and charged to the operator, the Province loses
income from the further processing of the wood. I recommend
that in future all skids of merchantable species be measured
and charged to the operator. If they are not hauled out of the
woods, double stumpage should be charged.
(7) In removing pulpwood, the lower layers of piles are sometimes
left because they are frozen to the ground, and it would delay
operations to loosen them. As hauling is done by piecework,
they are left to rot and again the Province loses the extra revenue
from processing. I recommend a penalty of double stumpage
charges on all wood so left.
(see picture on page 22)
(8) Trees of all coniferous species in practically all parts of the
Province, but particularly white and red pine in Eastern Ontario,
are being cut before they reach maturity. The high prices paid
by "black market" operators has recently accentuated this
practice. Many of the trees so cut have just reached the stage
where they are putting on their best growth and their cutting
Waste on a pulpwood, tie and log operation. Wood cut but not taken out of the woods. (Pulpwood-
exporting company operation.)
,/^-i
Sawlogs were cut from the jacl^-pine stand on the right and much limber was left to die of sunscald
and blowdown. On the left the same stand is uncut.
may be compared to slaughtering calves instead of full-grown
beef animals. Drastic action is needed if the practice is to be
curbed and, unless specifically authorized by the Minister or
Deputy Minister, I recommend that cutting of the following
species on Crown lands be forbidden under penalty, except as
follows:
white pine
red pine
spruce
jack pine
balsam
not less than 18 inches in diameter 12 inches
above ground or 125 years old.
not less than 16 inches in diameter 12 inches
above ground or 75 years old.
not less than 14 inches in diameter 12 inches
above ground or 100 years old.
not less than 12 inches in diameter 12 inches
above ground or 70 years old.
not less than 10 inches in diameter 12 inches
above ground or 60 years old.
FIRE PROTECTION
It has been noted that there is a tendency to minimize the disaster resulting
from fires in cut-over areas and in young forests which do not yet carry timber
which has reached merchantable size. I submit that this is an exceedingly
harmful attitude to adopt, as these areas are the ones which should provide the
timber for the next generation or two. It would be comparable to argue that
a disaster causing many fatalities in a boys' school was not really serious econ-
omically as none of the boys had yet commenced work at his career.
Fire in mature stands is at all times wasteful as regards present timber
resources and every possible measure must be taken to prevent it, but fire in
163 1
slash following operations or in young stands not yet producing seed, is doubly
disastrous as it normally leaves a barren. Fire in mature timber is usually
followed by a good future crop; in fact, some of the best pulpwood stands in
Ontario are the result of past fires in mature timber. Chapter X deals with
fire protection.
DESCRIPTION OF LIMITS
Areas described in licenses and agreements sometimes overlap and in some
instances conflict through the granting of similar rights on the same area to
both types of limit holders. The descriptions of other limits are qute inade-
quate, making trespass easily possible and difficult to establish without survey.
In many cases, areas are described but the limit lines have not been established.
One license which lapsed in 1946 granted rights to cut a million board feet of
lumber in Quetico Park but the area to be cut over was only roughly described
and situated within a block of 48 square miles, carrying probably ten times the
quantity of timber permitted to be cut under the license. The result can only
be deplored.
[64]
CHAPTER VI
Private Lands
AREA INCLUDED IN STUDY
In this chapter, a study is made of that part of Southern Ontario which
lies outside the districts protected against fire by the Department of Lands and
Forests. The counties or parts of counties involved are clearly indicated on
Map No. 10.
Much privately owned land and many thousands of acres of woodlot, actual
or potential, are located to the north and west of the area studied. Soil condi-
tions, climate particularly precipitation, existence of roads, communities, social
amenities and local markets, however, manifest the greater importance of the
area on Map No. 10 and the data in this chapter relate to it Many of the
recommendations made are equally applicable to the more northerly part, but
it must be realized that, on the basis of yield to the Province in social or econ-
omic benefits per dollar spent, the northerly part cannot compete with the area
shown on the map.
The area covered, which includes some Crown lands, amounts to 34,600
square miles (22,121,000 acres), or about 10 per cent of the Province. A large
proportion of the richest agricultural land of the Province lies within it.
FIELD SURVEY
The counties shown on the map were divided into three zones:
(1) Hastings County and eastward to the Quebec boundary;
(2) From Hastings County west to include the Lake Simcoe District;
(3) Huron and Erie Districts.
A forester from the Commission staff was assigned to each of these zones
and he was conducted and guided by personnel of the staffs of the District
Foresters. The Commissioner obtained an over-all picture of the existing situ-
ation by paying several visits to each of the three zones.
Examinations of many woodlots were made in every county, usually in
company with the owner. County and township officials, officers of agricultural
and conservation groups, and manufacturers of wood products were interviewed.
Owing to the limited time available, the examinations were extensive rather
than intensive, but they covered every major soil-type.
CHIEF PHYSIOGRAPHIC FEATURES
The chief physiographic features affecting forest types are as follows (see
Map No. 3):
(1) Pre-cambrian Shield,
(2) Niagara Escarpment,
165 1
(3) Sandy Moraines and Plains,
(4) Limestone Plains,
(5) Morainic Hills,
(6) Drumlin Areas,
(7) Marshes and poorly drained lands.
(1) Pre-cambrian Shield
This extends around the northern border of the woodlot area and consists
of granite and crystalline limestone. It is more suitable for the growing of trees
than for agriculture. In the Tweed District, however, the Townships of Elzevir,
Kaladar, Kennebec, Olden and Oso have recently been excluded from the fire-
protection area and parcels of land are being sold to individuals, apparently for
agricultural purposes. As this area has only scattered sections of marginal
agricultural land, is poor in appearance and is traversed by Highway No. 7, it
would be wiser for the Province to reverse the process, acquire more of these
lands, return them to the forest-protection area and put them back to growing
forests. It would be cheaper to buy the portions which do not belong to the
Crown and which will naturally reforest themselves, than to purchase and plant
similar areas elsewhere.
Hardwood forests, if given a chance, naturally reproduce themselves well
and carry heavier stands in unit of wood per acre than conifer forests, but plan-
tations of hardwoods to date have not generally been successful in this part of
the American Continent. This is most important, as much recently cut-over
land throughout the Province could be purchased and would return to hardwood
forest by natural means more quickly than would areas which have to be planted.
Furthermore, natural-reproduction costs per acre would be lower than the bare
planting costs on areas which have to be so treated.
Forest fires were very prevalent in this area many years ago. The last
one of serious consequence occurred in 1913, an indication of the tremendous
strides made in fire protection since those early days. Although many barren
and rocky hills are noticeable, much of the area is covered with a second growth
stand 40-60 years old. At this age pine trees are just entering their period of
best growth and as the tree increases in diameter, not only is volume increase
per year tremendously accelerated, but the grade of lumber that may be sawn
from it improves at an even faster rate. This fact has not been grasped, or is
ignored, by almost all private landowners whose forests contain growing pine;
and it would seem that, in their own and their childrens' interests, they should
be protected from their folly.
Cutting of immature pine or other species is very widely practised and I
believe it could be controlled through the licensing of sawmills. Provision of
license cancellation for sawing undersize logs would quickly reduce the practice
to negligible proportions.
(2) The Niagara Escarpment
This consists of a long series of steep slopes which extend from the Niagara
River to Owen Sound. Much of it has been cleared for agriculture but it suffers
badly from both erosion and drought. A programme of reforestation of denuded
areas is necessary.
1661
(3) Sandy Moraines and Plains
These consist of the sand plains of Eastern Ontario, the glacial moraines of
Central Ontario and the sand deltas of Western Ontario formed where the
glaciers entered the lakes of the glacial era. Portions of these sandy moraines
and plains have supported agriculture in the past, but many of the farms have
already been abandoned because their occupants could not make a living from
them and it appears that the rate of abandonment will be accelerated if and when
present prices of farm commodities recede.
Much of the reforestation done in the Province has been confined to these
areas and they contain most of the existing county forests. They form a fruitful
field for the practice of forestry, particularly the growth of conifers. Mute
evidence of the once splendid growth of pine that covered them still exists in the
form of pine stumps several feet in diameter.
It is recommended that the main effort of any enhanced scheme of
forest plantations be largely directed, in the earlier stages, to these
areas, as such a course would prove extremely sound economically, in
addition to conferring all the social and secondary benefits inherent in
the growing of forests.
(4) Limestone Plains
Much of this land is now used for grazing cattle and this practice appears
to be profitable. The situation should be closely watched, however, as tree
growth does not appear to balance the mortalitv in the forested area due to
grazing and cutting.
As the shade disappears, drought conditions are accentuated and, particu-
larly in Lennox and Addington County, the thin soil covering over the limestone
is disappearing. During dry spells, the animals' hooves powder the light soil
covering and it is washed away with the first heavy rain. Reforestation of
these areas, if attempted, will pose many problems yet unsolved and research
should be undertaken to discover method and species best adapted to fulfill the
needs.
(5) Morainic Hills
These hills, formed during the glacial period, occupy a horseshoe-shaped
belt of rough and stony land in Western Ontario. Some good livestock farms
are located in the area, but generally speaking the stony ground and the steeper
slopes should be in forest if they are to be utilized for their optimum community
value.
(6) Drumlin Areas
Areas of this type occur mainly in Grey. Bruce and Wellington Counties.
The characteristic round-topped sand and gravel hills are also a product of the
glacial period. They are admirably suited to the growth of trees and are of
little value for any other purpose, yet both sides and tops have been cleared for
agriculture, with serious erosion resulting in many instances.
(7) Marshes and Poorly Drained Areas
These areas are widely distributed in patches throughout Southern Ontario,
with the more extensive ones in Dufferin, Peel and Grey Counties and in the
1671
Poor land-use. Starvation pasture on thin soils over flat limestone. North of Napanee.
Note stumps of large pine trees which once greu) on this land.
Questionable land-use. Low-grade pasture on thin soils with limestone outcrops and glacial boulders.
Near Roblin. Lennox and Addington County.
northern portions of Ontario and York Counties. Where these lands have been
cleared they normally return to scrub willow and are utterly non-productive,
although for the most part they naturally had a covering of cedar, tamarac, elm,
ash and soft maple.
In any widespread effort of county or provincial reforestation, such land is
not likely to be as productive of economic returns as better-drained sites. As
little is known of how they may satisfactorily be returned to tree growth, it is
recommended that research be started here also as to method and
species most suitable for reforesting such areas. They form some of
nature's most efficient water-holding agencies and therefore are extremely im-
portant in the maintenance of stream flow and water tables.
A tendency to overestimate the value of draining swamps and marshes has
been mdicated in the past and the practice is sometimes mooted for future land
reclamation. Such schemes should be individually scrutinized and the best
expert advice obtained as to their over-all effect. Marshes drained for the
growing of onions in Western Ontario, in some instances, are subject to extremely
destructive soil-drift. Unless wind-breaks are planted or restored, it seems
possible that in another quarter century some of the present onion beds may
develop into lakes during a considerable portion of the year. I have seen 3'/2
cubic inches of soil obtained by melting a cubic foot of snow taken from a drift
in the vicinity of an onion field.
It must not be supposed that the draining of all marshes is unwise. The
Holland Marsh, for instance, is an example of the other extreme, where no water
storage is involved and the land reclaimed is probably put to the highest land-
use possible.
STATISTICAL INFORMATION AVAILABLE
There is a great lack of fundamental data on the woodlot problem in Southern
Ontario because:
(a) Statistics available regarding areas and their values are compiled chiefly
from reports of Township Assessors whose methods are not standard-
ized, with the result that they are in many instances scarcely com-
parable.
(b) Woodlot owners generally do not know the volume or area of their
forests nor the sales price obtained per unit of volume. Sales, when
made, are usually on a lump-sum basis for the material on a woodlot
or for a given number of logs of unspecified size. Most owners have
no idea of the quantity or value of material cut for their own use.
(c) There is a lack of comprehensive data concerning types and values of
products, numbers of people employed, wages paid, etc., for wood-
working establishments and sawmills in any specific area of the Prov-
mce. The source of raw materials for many of these establishments
IS known only to the owner and in many cases it is outside the Province
or the Country, although the industry originally used local material.
(d) The vast majority of woodlot owners have no idea as to the location
of a suitable market for much of their material, nor do they have any
adequate knowledge of its value or how it should be measured. As a
result, much high-value material is sold to local sawmills at a standard
1691
price and utilized for inferior purposes, while plenty of high-grade
material is used or sold as firewood. For instance, white ash, if sold
for handles for tennis racquets or for station-wagon bodies, could easily
return to the producer several times what he can get for it at the local
sawmill or as firewood. The retention of Doyle rule as the official log
scale of the Province has served to discourage many forest owners
from placing their logs on the market; conversely, it has served to
enrich many greedy buyers at the expense of the forest owner. A
marketing section within the Department of Lands and Forests, which
can be of service in these matters, will be discussed in a later portion
of this chapter.
SHRINKAGE OF FOREST COVER
Assessment figures for 1943 indicate the woodland percentage of the various
counties in the area included on Map No. 10 to be as follows:
%
Essex 2.8
Peel 3.9
Wentworth 4.0
Kent 4.4
Brant 4.6
Durham 4.6
York 4.7
Wellington 5.1
Russell 5.1
Welland 5.5
Dufferin 5.6
Oxford 5.7
Lincoln 5.8
Perth 5.9
Halton 5.9
Huron 5.9
Ontario 6.3
Middlesex 6.4
Dundas 7.0
Prescott 7.3
Stormont 7.9
%
Elgin 8.
Lambton 8.
Prince Edward 8.
Bruce 8.
Grey 8.
Haldimand 9.
Simcoe 9,
Northumberland 9,
Waterloo 9,
Victoria 10,
Grenville 12,
Norfolk 12.
Carleton 13.
Glengarry 15.
Leeds 19,
Frontenac 8.
Peterborough 18.
Lennox and Addington
Hastings
Lanark
Renfrew
20
23
27
.2
.2
.4
.7
,8
.1
,3
.3
.7
.6
,5
,6
.5
.4
.6
,8*
,2*
,7*
4*
7*
,5*
*This percentage applies only to that part of the County outside the fire-protection area.
The total acreage of the territory under discussion, as mentioned before, is
22,121,000 acres. In 1901, the assessed acreage within this area was 18,827,100
(remainder Crown lands, etc.), of which 3,124,500 acres or 16.6 per cent was
woodland.
In 1943, the assessed acreage was 19,131,400 with woodland shrunken to
1,848,100 acres or 9.7 per cent, a reduction of 41 per cent. For maintenance of
water levels, prevention of erosion, soil drifting, etc., European authorities argue
that not less than 20 per cent of the land surface should be under forest and in
Germany, where land value was exceedingly high in pre-war years, 28 per cent
of the land area was maintained under tree growth.
70
In Old Ontario, this percentage of forest cover has shrunk to 9.7 per cent
and devastation of woodlots is proceeding at an accelerated pace due to con-
tinuing needs for large quantities of firewood from diminished forest areas and
the unprecedented demand and high prices now paid for lumber, which in turn
have given a tremendous impetus to the worst type of jobber, whose only thought
is to cut the timber and realize on it while the boom market holds.
Various groups who have studied the question estimate that up to 8,000
square miles, or 5,120,000 acres of waste land in Old Ontario should be returned
to forests. There are no accurate figures available but the Commission staff is
convinced that at least 2,500,000 acres, and probably more, might profitably be
reforested.
At this point it is emphasized that of the 1,848,100 acres of existing wood-
land (on i 18,600 farms within the area studied), not more than 10 per cent could
possibly be classified as good forest.
WOODLOTS
The present situation in Ontario with regard to woodlots is very unsatis-
factory, due chiefly to the following:
(1) Owner's indifference and lack of knowledge.
(2) Cost of fencing.
(3) Assessments.
(4) Drainage schemes.
(5) Lack of marketing information.
Item No. I — Owners' indifference and lack of knowledge.
Woodlot owners may be divided into two classes:
(a) A minority who are interested for various reasons, and
(b) The great majority who are not interested but who happen to have
woodlots.
Most of the people interviewed were those in Class (a) above, because they
were known to the District Foresters. Few owners maintain woodlots primarily
to obtain revenue from them, but consider them a necessary source of supply of
material for their own use, such as posts, fuel, maple syrup, etc., or that they
serve the general community in maintaining water levels, preventing soil erosion,
etc. These owners rarely cut a tree unless it shows signs of decay and are proud
of this fact. Not one man interviewed took pride in producing high-quality
trees, or managed his land for wood-crop production in the same way that he
manages and plans his field crops. The vast majority of woodlot owners who
are in Class (b) use the woodlot for pasturing cattle and gathering from it what
fuelwood they may need.
How to convince this latter group of woodlot owners of the potentialities of
their holdings under long-term planning is one of the most difficult problems
awaiting solution. Many recommendations have been received concerning edu-
cational effort to this end in the schools, but the beneficial effect of such educa-
tional programmes will not be felt in a substantial way for some decades. These
woodlot owners do not belong to agricultural or conservation clubs or societies
where their problems may be discussed, nor do they read the excellent govern-
[71]
ment pamphlets which are available concerning woodlots. Few of them know
that there are District and Zone Foresters located across the Province to advise
and assist them, nor do they know of the beneficial legislation which has been
enacted over the years regarding reforestation of their denuded lands and main-
tenance of existing forests.
There is urgent need for the inauguration of immediate restorative measures,
as well as for the control of the exceedingly destructive methods practiced by
so many operators who purchase and remove timber from Ontario's woodlots.
In general, all species and all sizes are included in the purchase of such stands.
The material suitable for sawing is usually removed first and the remainder is
sold to a firewood dealer. If, as is usually the case, the lot is then used for
pasture, the cycle of devastation is complete and instead of a forest which, wisely
utilized, could continue to pay good dividends to its owner in perpetuity, there
remain a few acres of indifferent pasture which will rarely yield a noticeable
return.
As already stated, the ignorance and lack of interest on the part of land-
owners is a serious problem to be faced in developing a comprehensive plan of
forest management in Southern Ontario. It is foolish to consider replanting
millions of acres to forests unless the owners of the millions of acres already
under forest are convinced of the necessity and economy of caring for them in
such a manner that they will be perpetuated and improved. The trend until
now had been toward deterioration and disappearance although, as mentioned
earlier, it is cheaper and easier to maintain in production and improve an existing
woodlot than to plant an equal area and tend it until its crop is ready to be cut.
Woodlol clear-cut for fuelwood. The soil is thin on partly exposed rock.. Such land is unfit for agricultural
crops or pasturage and will yield negligible revenue for forty years or more. Bruce County.
The public are inclined to criticize the methods of operation of Crown
lands and their administration. I can truthfully say that the operations on
Crown lands, now and in the past, have rarely exhibited any instances of such
poor forestry methods, or so little thought or consideration of the future, as is
to-day exhibited on more than 75 per cent of the farm woodlots throughout the
Province. There is, it is true, a pitifully small minority of woodlot owners who
manage their forests wisely and well and are reaping a rich harvest from them.
I estimate this group to include less than two per cent of the woodlot owners.
Many who do not abuse their forests by using them as pastures, overcutting,
etc., do not harvest them wisely for, as mentioned earlier, they cut only the trees
which show signs of defect. This practice is equivalent to using only the de-
fective apples from the barrel, with the result that one never gets a good apple.
Trees should be cut when they have reached their prime and the space
they occupy utilized for growing more trees. Defective and crooked trees
should be removed and the healthy and straight ones allowed to benefit from
the sun, rain and nourishment which will otherwise be wasted on the inferior
members. Only in this way can a forest yield its best. There are forests in
Europe which, after several hundred years of cutting, are as good as or better
than the original stands. The practice of forestry refutes the adage that one
cannot eat one's cake and have it.
The most widespread abuse of forests is that of utilizing them as pasturage
for animals. If this practice alone could be eliminated, more than half the
battle to save Ontario woodlots would be won. Forestry and pasturage cannot
succeed on the same piece of ground, as diametrically opposite conditions are
necessary for each.
Evidence has been given by competent authorities that an area of open
pasture will maintain from six to twelve times the numbers of animals that can
be maintained on a similar area of forest. Many farmers are deceived because
a part of the area used as pasture is cleared and a part wooded. Most of the
increase in size and weight of their animals is gained on the cleared portion of
their pasture area, while the wooded portion is ruined by the destructive action
of the cattle and furnishes them with little nourishment.
If one studies the ground surface in a well protected forest, it will be noted
that there is a coating of humus, sometimes several inches in thickness, resulting
from decaying leaves, twigs, bits of wood, etc. This is most important as it
acts as a sponge to prevent the rapid movement of water and to hold it until
it is absorbed into the ground while, in addition, it serves as a blanket so that
the ground is frozen less deeply than in the open. The movement of trees by
the wind ensures cracks in the soil which permit of deeper penetration of water,
and the humus serves to keep these cracks from being clogged. Humus is also
the habitat of most of the complex but necessary and beneficial insect and small
animal life in the forests.
Where cattle are pastured, the humus is tramped down and can no longer
fill the above functions. Tree roots become exposed and a prey to fungus dis-
eases which result in dead tops and poor growth. At the same time, the sap-
lings are denuded of leaves eaten by the animals and the seedlings are eaten or
tramped down. A comparison of pastured and unpastured forest land is vividly
portrayed in the accompanying pictures.
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Pastured and unpaslured woodlots. Note the thrifty young growth to the right of the fence and its
absence on the grazed area. Grey County.
A well-stockjed, all-aged woodlot with a good crop of seedlings typical of ungrazed stands.
Grey County.
1
* >
Item No. 2 — Cost of fencing
The cost of fencing and its maintenance has been a big factor in the de-
terioration of the Ontario woodlot. It would be poor economy not to remove
this factor, as the cost of fencing woodlot areas is much less than the cost of
planting new forests. Many recommendations at the public hearings of the
Royal Commission were for government or county assistance in fencing wood-
lots. I recommend that the Province and the Counties share in a pro-
gramme designed to provide half the cost of fencing the woodlots or
repairing, to a proper standard, the woodlot fences of any property
owner willing to enter an agreement with the Department of Lands
and Forests. Such agreement should provide for proper care and per-
petuation of existing forests or new plantations, and must carry the
approval of the District Forester.
Item No. 3 — Assessments
Present legislation concerning assessment practices on forest land may
easily result in discouragement of sound forestry. Assessments up to $50.00
per acre on woodlot areas is fairly common. In some instances, County Assessors
are permitted to assess mature woodlands up to $75.00 per acre in Townships
where the best farm lands are not assessed above $50.00 per acre. This is
obviously taxing the crop on the land rather than the crop-producing value of
the land, and does not take into account the fact that it has taken many decades
to produce the forest, with high taxes in effect on it throughout the years.
The unsoundness of such taxing becomes most apparent if the owner decides
to destroy his forest and to cash in on his forest crop. The same acres which
were taxed so heavily may be sold to "cut-out and get-out ' jobbers who remove
everything but the small limbs and stumps, whereupon the owner can have his
land re-assessed as "slash" land at rates as low as $2.00 per acre. This low
assessment rate is also detrimental to the practice of forestry, as it permits
typically forest land to be utilized for low-grade pasture or left in idleness or
near-idleness when it should be kept under forests.
As a solution, it is recommended that an equalization of taxation
rates be undertaken, with a reduction in taxes on lands already carry-
ing good forests, and an increase on lands which are barren or near-
barren but which are potential forest sites and would develop their
highest economic and community utilization if retained for or returned
to the growing of trees.
Justifiable assessment rates ranging, say, from $6.00 to $12.00 per acre,
based on capacity to produce forests (some sites are better than others) would
remove the unjust burden from the more highly taxed forest lands and place the
levy on those lands which have been relegated to an inferior use because of the
ignorance, short-sightedness or cupidity of the owners. The higher assessment
on forest lands within the latter group would induce either reforestation or
abandonment of the lands for non-payment of taxes; in the latter event, the
municipality, county or Province could include them in a wider scheme.
There will be difficulty in overcoming the objection of municipal taxing
agencies to the adjustment of their taxation structure, but without some such
adjustment it is unlikely that in the near future there will be any significant
action on the part of individuals toward utilization of typically forest-lands for
the growing of forests.
175 1
It is also submitted that there is Httle of value in existing Statutes which
permit municipalities to exempt from taxation up to 10 per cent of a farm, a
portion of which has been divorced from pasturage and devoted to forest growth,
either as a natural forest or as a plantation. It may readily be appreciated that
such exemption, amounting usually to a couple of dollars per year (and rarely
over five dollars) on lands already assessed at low value, is little inducement to
an owner to plant and care for a forest which requires several decades before
it commences to yield economic returns.
Bonus in lieu of tax exemption
Several recommendations have been made that a bonus be paid to any
forest owner who, eliminating pasturage, will maintain his existing forest, or
plant and care for a new one.
I consider that such recommendations are soundly based and have much
merit as both the Province and the local community would gain from the enter-
prise of the individual earning the bonus. The community benefits are many:
the countryside is beautified; water tables are improved; stream-flow is main-
tained and improved, and habitat provided for fish and wildlife, thereby en-
hancing the recreational value of the district. I therefore recommend that
the Province and the Counties jointly explore some method by which a
yearly bonus of the nature recommended may be paid on young forest
stands until they reach the production stage, provided they are cared
for in a manner approved by the District Forester.
Item No. 4 — Drainage schemes
The drainage of agricultural lands has been the subject of Provincial Legis-
lation over a long period but the schemes which have been carried out, particu-
larly in recent years under the provisions of the Statutes from time to time in
force, have proved most detrimental to woodlands in parts of the Province.
The principal Statutes now in force dealing with drainage matters are The
Municipal Drainage Act, R.S.O. 1937, ch. 278, and The Ditches and Water-
courses Act, R.S.O. 1937, ch. 350. These Statutes are merely the present day
versions of the laws which have been in existence for many years. There have
been amendments and changes in procedure but it is important to realize that
the spirit and intent of the earliest Statutes have been preserved to the present
time.
It must be conceded that in early days, drainage was necessary, if not vital
for the cultivation of most of the farm lands in Ontario, and it was only natural
that all drainage should be considered to be beneficial. The idea that the Prov-
ince might some day suffer from lack of forests and swamplands was probably
not even considered, and anyone who expressed such views would probably have
been considered a visionary. However, it is rather surprising to find, under the
vastly changed conditions of to-day, Statutes still in existence which encourage
practices which have already ruined thousands of acres of our essential forest
lands, which are causing widespread distress by the lowering of water tables
and which give a mighty impetus to the erosion of our valuable agricultural soils.
The Municipal Drainage Act provides for the construction of large drainage
works, quasi-public because of their extent and the number of landowners
affected. Such schemes are initiated by petition to the Municipal Council who
1761
may then have an engineer examine the area, prepare a report, plans, specifica-
tions and estimates and assess the costs against the lands to be benefitted. Upon
the engineer's report being received, the Council may, by by-law, adopt the
scheme and provide for the execution of the work. The cost in the first instance
falls upon the municipality which may raise the amount required by an issue
of debentures, and is eventually recovered from the owners assessed in the same
manner as taxes.
The Ditches and Watercourses Act enables the owner of a small area oi
marshland, which in its original state may be fulfilling a valuable function,
to force on his neighbours the construction of a ditch or drain which may be not
only of no benefit to other owners, but even a positive detriment. The operation
of this Act is limited to minor projects where the cost does not exceed $2,500
and the drain does not pass through more than seven township lots. The engineer
appointed by the municipality to carry out the provisions of the Act has the
responsibility for deciding if a proposed drain is required and it is he who decides,
subject to appeal, what lands will be benefitted. If he determines that the drain
is required, he makes an award providing for its construction and determines what
portions of it are to be made by the different landowners.
While it is quite true that under both Statutes the expense is to fall only on
the owners of lands which are benefitted, nevertheless the belief seems to persist,
among those who are called upon to administer the law, that if land is drained,
benefit must ensue. No consideration is given to the fact that the drain may
imperil the life of forests along its course by the lowering of the water table,
which leaves the shallow root system with insufficient moisture in dry seasons.
No provision is made for compensation to owners whose lands are damaged,
unless the damage has been occasioned by flooding, upon the assumption,
apparently, that it is only this obvious kind of damage which is important.
Evidence was given by an engineer at London, Ontario, indicating that the
cost of a drainage scheme carried out to provide an actual or presumed benefit of
$500 to one individual, might easily cost up to $10,000 spread over a number
of landowners and cause damage to woodlots, soil, wells and ponds exceeding
that amount, and without any compensation being paid to landowners who
must bear the loss.
Such projects normally follow lower ground where most of the remaining
trees in the area are found. Modern ditching machinery and practice provide
deep, wide, and straight ditches which will tend to speed up the flow of water to
prevent silting and to reduce maintenance costs. Nature's method of prevent-
ing erosion is to have the streams meander across the landscape, lengthening
the distance and thereby reducing the gradient from point to point. It will
therefore be appreciated that drainage schemes normally reverse nature's methods
by creating steeper gradients and faster currents which increase erosion. There
are many instances where a return to nature's methods would appear to be in
the general interests of the communities concerned.
Some drainage projects are necessary and beneficial. On the other hand,
however, possibly the majority are ill-considered and unwise, with many of the
land-owners concerned annoyed by and antagonistic to them. Some projects
are obviously the children of ignorance and spite, and the original cost of the
project frequently exceeds the value of the land reclaimed.
[771
I recommend a complete and early review of The Municipal Drain-
age Act and The Ditches and Watercourses Act with the object of in-
suring:
(a) that no drainage project will be undertaken until its probable
effect upon the community as a whole has been considered by a
board of referees composed of judicial and engineering personnel,
as well as practical farmers, and the approval of such board
obtained;
(b) that no single landowner or small group of owners may be en-
abled to force an unwanted and even detrimental drainage
scheme on neighbouring owners without their consultation and
consent;
(c) that the costs of the work will be equitably distributed among
the landowners actually benefitted;
(d) that provision is made for payment of compensation to those
injuriously affected, and
(e) that Municipalites have power to expropriate areas which it is
proposed to drain, when the welfare of the community requires
that the area in question should be maintained in its existing
state.
I believe that a revision of the above-mentioned acts in conformity with
these recommendations should elimmate many complaints, which were drawn to
the attention of the Commission and that few. if any, genuinely-needed drainage
projects would be prejudiced thereby.
Item No. 5— Markets
A relatively quick solution of the present serious problem of woodlot devas-
tation could be furnished by assisting woodlot owners to market their products.
A ready, reliable, profitable and well-advertised outlet for the products of the
average woodlot, regardless of the individual quantities or species produced,
would engender in the minds of the great mass of owners an interest in the
long-range possibilities of scientific forest management. No amount of propa-
ganda, whether in the form of lectures, pamphlets or magazine or newspaper
articles, will ever be as effective in convincing a farmer of the advantages in
retaining, guarding and improving his young stands, as the knowledge that the
trees which he is allowing his cattle to damage, or is tempted to sell to a jobber
for a lump sum, will be three to ten times more valuable if directed to their proper
market when they have reached their peak value. This knowledge would be most
effectively driven home if he were to discover that, by delivering a truck load of a
few mixed logs of yellow birch, white ash, oak, maple or hickory to a collection
centre in his county, he v/ould obtain $75 to $100 for them instead of the $20 to
$30 yielded by cutting them into firewood or by selling his bush to a jobber.
Most farms have a woodlot. There are 1 ,848,000 acres of woodlot mostly
on 118,000 farms in the area shown on Map No. 10. Relatively few woodlots
to-day contain a large number of trees which may be sawn into logs of merchant-
able size, but most of them have some. Due to lack of knowledge on the part of
farmers concerning location of markets, values, and the number of feet board
measure which may be obtained from a log of a given size and length, most
[78 1
of the potential supply of timber on Ontario's woodlots never gets into its proper
economic channel. Even with this present unsatisfactory condition of farm
woodlots, the standing timber of merchantable size presents a very imposing
total. The annual harvest possible could even now largely provide for our domes-
tic wood-using industries if it were diverted to them.
The extensive furniture industry which located in Western Ontario because
of the hardwood forests originally growing there, now depends to a large extent
on imports of hardwoods from outside the Province. Hickory and white ash
for the handle industry come from the United States. The trees on which these
and other industries were founded grew and may be grown again in the districts
close to the factories. Sufficient material to permit the industries to live and
expand is scattered across the Province on tens of thousands of woodlots. Some
means must be found to funnel the material to collection centres from which it
may be distributed to the industries which are in danger of starving from lack of
it. Whether this may best be done by co-operative agencies or by a Crown
corporation is a subject for study, and there need not be the same type of agency
in all districts. Either agency could perform the service, and the function of
the government would be to assist in organizing the proper flow of material
where existing agencies are available and to provide facilities in areas where such
do not exist. The government must also supply necessary advice as to cutting
methods, what and when to cut. etc.
I recommend that the Government set up a Marketing Division
within the Department of Lands and Forests and that the services ren-
dered by the District and Zone Foresters be widely expanded^
Many woodlot owners who think they are very well served with regard to
markets would be much surprised to find that in other localities, no more favour-
ably placed, people receive twenty to thirty dollars more per thousand feet board
measure for similar material. For example, species used for railway ties or car
stakes, etc., can be diverted to higher value products such as handles, furniture,
or flooring.
MAPLE PRODUCTS
Any discussion of woodlots in Southern Ontario should contain a reference
to the maple-products industry. It is true it does not loom large in the economy
of the Province, but it does contribute an appreciable part of the income of those
who participate in it. Statistics indicate that from 1910 to 1940 the production
of maple syrup dropped by more than 50 per cent (766,300 gallons to 359,900
gallons) while the drop in maple sugar production was even greater (251,100
pounds to 20,800 pounds). This is probably due to two main factors: disappear-
ance of many of the sugar-bushes and a shortage of labour.
DEMONSTRATION WOODLOTS
Demonstration woodlots are located widely across the Province, but to date
they have not accomplished results commensurate with their possibilities. Signs
indicating demonstration woodlots have aroused interest and occasioned many
inquiries directed to district personnel. Motorists and others, however, seem
reluctant to stop and examine the woodlots and, as a result, little time or effort
has been devoted to them for several years.
[791
I am convinced that if the signs indicating woodlots gave more compre-
hensive information regarding what was being demonstrated, including rate of
growth per acre, content or value at stated intervals, the date at which young
stands will come into production, etc., many more people would stop and inspect
the notices and the forests. It is not sufficient to put up a sign merely indicating
the location of a demonstration forest.
FIRE PROTECTION
Fire protection is entirely inadequate in the areas adjacent to but outside
those protected by the Department of Lands and Forests. Local municipal
employees rarely have much knowledge of methods to be employed in fighting
fire and, in any event, the necessary equipment is generally lacking.
I recommend that the Department of Lands and Forests be em-
powered to enter into agreements with adjacent municipalities to pro-
tect their forests at a fee commensurate with that paid by limit holders.
I also recommend that the Department set up classes to train key fire-
fighting personnel for those municipalities too remote from a protection
area to justify their being included in it. All the heavily wooded mun-
icipalities should be urged to purchase and have on hand sufficient
fire-fighting equipment to cope with a crisis when it arises.
It should be mentioned that the Fire Protection Service assists in detecting
and fighting fire on private lands up to the capacity of equipment and personnel
available, without depriving its own areas of essential services.
PRODUCTION POSSIBILITIES
A glimpse at the present and future possibilities of Ontario woodlots should
probably be provided at this time. There is little authentic data applicable to
existing conditions and we can only turn to statistics of older countries which
have developed forestry practice over a period of centuries.
These sl^elches represent what is happening all too commonly in Ontario to-day. Many woodlots are
used for grazing and most are in poor condition. Then they are clear-cut and the bulk, of the wood is
used for fuel with comparatively little going into sawlogs. pulpwood. or other relatively high-value
products. Following cutting, little is left but waste and desolation.
In the mid 1920's, before Hitler had risen to prominence, Germany, with
31,268,500 acres of forest land, was cutting on the average about 48 cubic feet of
stemwood per acre per year. This provided, amongst other products, some
200 board feet of lumber. Cuts varied between 28 cubic feet per acre on their
more poorly managed stands, to 65 cubic feet on the better managed stands on
[801
good soil, with corresponding outturns in lumber of 1 10 board feet and 300 board
feet per acre per year plus other products. In addition, a large quantity of
fuelwood was produced from limbs.
Present Possibilities
I estimate that Southern Ontario's woodlots could now produce wood on a
scale comparable with Germany's poorer stands, or at least 25 cubic feet per
acre per year, of which the quantity suitable for lumber would be at the rate of
60 board feet per acre. This is equivalent to a total annual production from all
woodlots in the area under discussion of I 10,000,000 feet board measure of lumber
and some 300,000 cords of fuelwood and pulpwood, in addition to the fuelwood
from limbs, thinnings and sawmill waste.
These sketches represent how the woodlot could and should be managed in the near future. First the
cattle are fenced out. Then, when cutting is done, it is on a selective basis and as much wood as pos-
sible is made into veneer-logs, sawlogs. pulpwood. and other top-price products with only the refuse
used for fuel. {The need for fuelwood could be met by drawing upon the forests north of the settled
area which could well be used for this purpose for a time.) Finally, when the cutting is finished, a
good residual stand is left to form the basis for the next crop.
Possibilities in 30 years
If sound silivicultural methods are developed and implemented, in thirty
years' time we might expect to be able to make an annual cut of 36 cubic feet
per acre including 100 board feet of lumber. This would be equal to 184,000,000
feet board measure of lumber and 370,000 cords of pulpwood and fuelwood, in
addition to the by-products.
// the policy suggested in the previous set of sketches is carried out. the woodlots will be in a much
healthier condition 30 years hence. The yield of good sawlogs and pulpwood will be increased and so
too will be the supply of fuelwood. because more limbs and tops will be available for this purpose. If
the cutting is done wisely, the quality of the residual stand and the new growth will be increasingly good.
Possibilities in 75 years
At the end of a rotation of, say, 75 years, the forests should have almost
reached their maximum development and we could anticipate an annual cut of
48 cubic feet per acre per year, including I 50 board feet of lumber. This would
equal 276,000,000 board feet of lumber and 425,000 cords of pulpwood and fuel-
wood, plus other by-products.
In all these figures it must be kept in mind that a sawlog may be used as
pulpwood and, if it is more profitable to do so, a considerable proportion of the
material shown as lumber above may be diverted to use as pulpwood. Some of
the material will be utilized as poles, ties, posts, etc., dependent upon markets.
After about 75 years of careful "farming" , the ivoodlots of Ontario will be yielding their maximum
crop of all products — a crop which should be twice as great per acre as it is at present. This could
be maintained indefinitely as long as good forestry is practised.
The above figures and charts indicate reasonable possibilities which I believe
will be far surpassed as soon as the landowners grasp the possibilities of forestry
and allow potential forest lands, now wrongly used as pasture, to revert to their
proper use. That the figures are not fantastic is certain, as there are already
some of the best forests in the Province putting on growth approaching 100
cubic feet per acre per year.
PLANTING OF NEW FORESTS
The foregoing production possibility applies only to existing privately-
owned woodlands. In addition, there are the millions of acres of wasteland which
should be replanted. As mentioned on page 71 , the Commission staff's minimum
estimate of this area is 2,500,000 acres. (It is probably actually much higher,
with estimates of various authorities up to 5,100,000 acres.) A large proportion
of this area is better suited to conifer growth, though the heavy lands and moist
areas should be devoted mainly to hardwoods. This area is much too great to be
planted in a few years and I recommend planting for the first ten years of
100,000 acres annually, commencing in five years' time, the remainder
of the area to be planted in the ensuing ten-year period at the rate of
150,000 acres per annum.
SEED COLLECTION
Any considerable increase in seedlings for planting cannot be expected
before three to four years because problems of seed collection and extraction and
nursery expansion are involved. Seed in storage is at present at a very low
figure due to lack of labour for collection, and this will cause a very serious
182 1
■»5S|iK»
£. Jl3£.
Reforestation needed. Note the large pirn stumps on the eroding, sandy hill. Near Rockland , Russell County.
A typical blow-sand area. Such land is not only unproductive but it becomes a menace to the surround-
ing country through sand drifting. It should be reforested.
Blow-sand has made this road unfit for use. Note the plantation on the right which is correcting this
condition. Ontario County.
Erosion of clay land on the Lake Huron shore near Port Albert. The gully is about 70 feet deep at
shore and extends about one-quarter mile inland.
bottleneck. Seed collection should be expanded this year to produce
about four times the annual quantity of conifer seeds gathered nor-
mally, with a less pronounced increase in the volume of hardwood seeds.
(Existing woodlots may be expected to produce hardwoods to an amount of
three or four times the volume of their softwood output in the next 30 years.)
Years in which seed is produced in abundance vary widely between the species,
and in the pines and spruces usually occur at four- to seven-year intervals.
Pests of one sort or another, insects, squirrels, etc., often ruin or steal most of
the seed unless it is collected within a few days of ripening.
FREE DISTRIBUTION OF SEEDLINGS
Free distribution of trees to private land-owners commenced in 1905 with
an output of 10,000 trees. This has increased to 8,000,000 trees for distribution
last year. Unfortunately, a study of results indicates a high mortality amongst
seedlings distributed to private individuals, particularly in the hardwood species.
This is due to improper handling, poor planting and to unwise selection of species
in relation to soils. Provincial nurseries could at present produce up to 23,000,000
seedlings annually, though total distribution of all species has averaged about
1 2,000,000 per annum for the past five years.
The planting of Scotch pine for Christmas trees has accelerated tremendously
in recent years and the threat of over-production of Christmas trees would seem
to be imminent. Here I should add that planting or cutting young conifers for
Christmas trees is not bad forestry and it is not unpatriotic. It is a legitimate
industry, usually representing good land-use, with high economic returns per
acre. If the thinnings of conifer stands are utilized for this purpose, it can be
considered good forestry. Incidentally, a tree which has sufficient branches and
is the proper shape to become a desirable Christmas tree, is not likely to develop
into a tree which will produce the higher quality of material needed for lumber,
pulp, poles, etc.
GROWTH POSSIBILITIES FROM PLANTATIONS
If, commencing in five years, 2,500,000 acres of Southern Ontario are planted
in the ensuing twenty years, economic returns from thinnings may be expected
to be realized about 1 985. These returns will grow progressively as the plantations
mature until roughly 100 years from now, by which time all the plantations will
have reached, or be reaching, maturity and we may expect a stand averaging 25,000
feet board measure, or over 50 cords, per acre.
The bulk of planting will probably be in red pine, jack pine and white spruce,
with some white pine, so that an average rotation between 80 and 90 years should
be ample. Even at 90 years this would permit an annual cut of 50 cubic feet
per acre per year, or a total of 125,000,000 cubic feet per year. It is doubtful just
what form of product markets will demand by that time, but that quantity
would produce all of the following:
300,000,000 feet board measure of lumber,
750,000 cords of pulpwood,
500,000 ties,
125,000 poles.
Truly, in forestry one must think in terms of half centuries and centuries, and
the countries with the vision and courage to do so will benefit from tremendous
[85 1
returns. To those who think a century is too long to look ahead, I point out that
Confederation is 80 years behind us.
In addition to the main benefits of increased production, there will follow all
the other secondary benefits, such as control of stream-flow, maintenance of
water tables, prevention of erosion, provision of proper environment for wild-
life, and improvement in the recreational possibilities and aesthetic values of
the Province. Some children now starting to school will live to see the culmina-
tion of such a scheme.
PROVINCIAL, COUNTY AND MUNICIPAL ASSISTANCE
TO FORESTRY ON PRIVATE LANDS
The problem of reforestation of waste lands in Southern Ontario was apparent
to many in the later years of the nineteenth century and this knowledge was
crystallized into action in 1904 by the establishment of a lectureship in forestry
at the Guelph Agricultural College. The Faculty of Forestry, University of
Toronto, commenced to function in 1907 and the next step was the establish-
ment of the Provincial Forest Station in Norfolk County in 1908.
In 1911, the Counties Reforestation Act was passed by which counties, and
to a more limited extent townships, were enabled to purchase land and under-
take forestry work under thirty-year agreements with the Province. At the last
session of the Legislature, this Act was amended to extend to townships the main
benefits of the legislation.
Broadly speaking, existing agreements provide that the county or munici-
pality purchase the land and that the Province plant and care for the forests for
a period of thirty years. At the expiration of this period, three options are
presented to the county or municipality. They may:
(a) Repay to the Province, without interest, one half of the money expended
in connection with planting, buildings, equipment, etc., less any income
received, and share equally with the Province in future revenues, or
(b) Pay to the Province, without interest, all money expended in connec-
tion with planting, buildings, equipment, etc., less any income received,
and take full possession, or
(c) Convey to the Province full title to the forest plantation, buildings,
equipment, etc., on repayment, to the county or municipality, of the
purchase price, without interest.
None of the counties availed itself of this exceedingly generous legislation
until 1922 when Simcoe County purchased 1,000 acres of sub-marginal land
which now forms part of the "Hendrie County Forest". The County Forests
established under the Act, as well as those which do not come under the Act,
are shown on Map No. 10.
On the whole, the County Forests seem to be well managed and thinnings
are now being taken from some of the earlier ones in the form of pit-props and
firewood. It is recommended that the legislation now existing in regard
to County Forests be amended and widened to include cities, towns,
villages, individuals, estates and corporations.
In some counties, if recreational and aesthetic values are to be restored and
stream-flow, water tables and soil-erosion controlled, the areas to be reforested
f861
are so extensive that the cost will be greater than the county revenues may be
reasonably expected to bear. In such instances, where population is sparse and
potential forest areas are large, probably the only effective approach to a large-
scale reforestation programme is for the Province to purchase and plant the land,
recouping itself for such expenditures from stumpage dues when the timber
reaches maturity. Grey County probably comes within the above-mentioned
category.
There are a number of school plantations throughout the Province. Some
are well managed and others very badly managed, the care given to the plantation
being generally in proportion to the interest displayed by the teacher.
School forests or plantations could serve a very useful purpose if carefully
planned and supervised. Each pupil could look after part of a row of trees or a
plot and prizes might be given for competitions to be judged by officials of the
Department of Lands and Forests. Pupils should be taught to recognize species,
count growth rings and take a general interest in the biological life of the forest.
The Ontario Horticultural Association gives annual awards for school competi-
tions and thereby performs a most commendable service.
The following Provincial Forest Stations are now operating or are under
development:
Norfolk Provincial Forest Station (Norfolk County) —
Established 1908. Serving Southern Ontario Region.
Midhurst Provincial Forest Station (Simcoe County) —
Established 1922. Serving Lake Simcoe and Georgian Bay Region.
Orono Provincial Forest Station (Durham County) —
Established 1922. Serving Central Southern Ontario.
Kemptville Provincial Forest Station (Grenville County) —
Established 1945-46. (Now under development to serve Eastern
Southern Ontario.)
Thunder Bay Provincial Forest Station —
Established 1945. Serving Northwestern Ontario.
BONUS PAYMENTS FOR PLANTATIONS
A few counties and townships have voted monies in aid of forestry activities
by individuals. Prince Edward County voted $5,000 toward reforestation in
that County. In Fredericksburg Township up to $4.00 per acre has been paid
for tree planting, while in Camden. Lennox and Addington County, a landowner
can collect for reforestation as much as $6.00 per acre on up to 10 acres. Of this
sum, the County pays $2.00 and the Township $4.00. There is some diversity
of opinion as to the value of this type of bonus, with claims that these plantations
are not as well cared for or as indicative of continued interest on the part of the
owners, as those which are the product of the owner's effort.
While reliable statistics are not available as to the area or quality of forest
plantations resulting from seedlings supplied to individual landowners, un-
doubtedly several thousand acres are involved. Encouragement to owners to
add to these plantations should not be overlooked.
187 1
CONSERVATION AND REFORESTATION ASSOCIATION
This is an association of the Conservation and Reforestation Committees
of County Councils. The Association divides the Province into five zones in
Southern Ontario and meetings are held in each zone once a year. It is an
association whose work should be encouraged and expanded.
THE TREE CONSERVATION ACT
This Act passed in 1946 enables counties to pass by-laws regulating the
size of trees that may be cut on private lands and, in general, ensures against any
further denudation of already inadequate forest cover. Only eight counties
have so far availed themselves of its provisions and it is yet too soon to assess
the efficacy of the measures taken. It is difficult to enforce an enactment of this
sort unless the general public support it. It is a step in the right direction,
however, and with experience may prove to be exceedingly useful in curbing
present abuses.
Many recommendations were made to the Commission that the Province,
rather than the counties, should exercise such control. It was properly argued
that many counties most in need of this type of legislation would hesitate to
enact it because of the unpopularity of any measure aimed at controlling the
action of an individual on his own property. It was even stated that in some
counties a council which passed such a by-law would have no hope of re-election,
and that therefore the Province should act.
I am convinced that regulation of the material to be cut in private forests
is more necessary here than it is in the Scandinavian countries, where it is the
rule. As the community suffers through the destruction of a forest, it may pro-
perly be argued that they should have some control over its maintenance. We
have many laws already on the Statute Books, such as those concerning noxious
weeds, which limit the freedom of the individual in the use of his land. I there-
fore feel that regulations covering the trees he may cut would not establish any
new principle.
I recommend that, as soon as district forest personnel is available
in sufficient numbers to supervise such a scheme, provincial legislation
be enacted controlling the cutting of trees on private lands.
I maintain that a diameter-limit is not an adequate solution of the problem
and never can be. Many trees should be removed as thinnings or because they
are crooked or otherwise defective, even though they are below any diameter-
limit which might reasonably be set, and the forest would benefit by their removal.
On the other hand, a diameter-limit suitable for one species may be entirely
unsound for another and might permit the removal of some trees which have
barely reached their best growing years.
The trees to be cut should be marked by trained personnel. This is probably
the only safe and sensible approach to managed forestry and its application will
result in sound economy. It will be five or more years before we can hope to
have sufficient trained forest personnel to carry out such a scheme on anything
more than an experimental basis.
I feel it my duty at this time to pay tribute to the splendid work that has
been done by the pioneers of forestry on private lands within the Province.
Headed by Mr. E. J. Zavitz, who was the first and for years the only forester to
devote full time to this work, this totally inadequate group of scientists has
battled for years against apathy on the part of the public and the consequent
lack of funds and personnel necessary to develop a programme which the situation
demands. A sound foundation now exists in the nucleus of a staff. Their zeal
and courage in remaining in their chosen field, despite obstacles and discourage-
ments which might easily have daunted lesser spirits, have resulted in the intro-
duction of legislation and the establishment of nurseries which have encouraged
and facilitated forestry.
ADMINISTRATION
For administrative purposes, the woodlot area of Southern Ontario is divided
into six districts, each headed by a District Forester. In some of the larger
districts, they have the assistance of Zone Foresters.
The fusion of the administration of Fish and Wildlife activities with those
of the Department of Lands and Forests has added a tremendous amount of
administrative detail to the work of the District Forester, particularly in the
issuance of permits and in accounting. His greatest value lies in field contacts,
spreading the gospel of forestry amongst the landowners in his district, and any
administrative work which prevents such contacts is difficult to justify.
The amalgamation of the two departments is admirable and practical, but
if the cause of forestry on private lands is not to be seriously hampered as a
consequence, the District Offices will require additional staff to assist in adminis-
trative duties.
The present set-up is as follows:
District Head- Zone
District Forester quarters Foresters
Erie F. S. Newman St. Williams H. Zavitz
Huron I.e. Marritt Gait W. Thurston
J. C. Jackson
Lake Simcoe J. F. L. Simmons Maple
Trent A. B. Wheatley Lindsay
Tweed A. Crealock Tweed W. E. Edwards
W. W. Tweed, Asst.
Dist. Forester
Rideau W. E. Steele Kemptville
The District Foresters are assisted by specialists of the different divisions
of the Department of Lands and Forests.
Four forest nurseries are located in Southern Ontario, and one in Western
Ontario, as follows:
St. Williams
Midhurst
Orono
Kemptville
Port Arthur
I am assured that the efficiency of the nurseries could be improved and costs
lowered if they were to be mechanized to a greater degree. United States nur-
series now use seeders, transplanters, lifters and tree-planters. In Ontario, the
lack of assistants to nursery superintendents is noticeable.
1891
A seed-extraction plant under the direction of Mr. R. S. Carman is located
at Angus, Ontario.
The personnel at present administering forestry on private lands can only
serve as a nucleus of the staff required for the tremendously expanded programme
which is foreseen if adequate measures are to be taken to restore the minimum
forest-cover necessary. One trained forest-engineer for each two counties is
the minimum technical staff required, and some of the larger and more heavily
wooded counties, such as Haliburton, will require the full-time services of a
forester. In addition, each forest engineer will require four to six trained Zone
Foresters to assist in marking trees, in helping landowners harvest their forest
crop properly, and in inspection work generally.
CONSERVATION AUTHORITIES
Under The Conservation Authorities Act of 1946. municipalities may
group themselves together to undertake schemes of conservation, restoration
and development of natural resources, or for the control of water to prevent
floods and pollution, or for similar worthy purposes. One or more watersheds
may be covered by such an Authority.
Upon agreement being reached by the municipalities participating in any
such scheme, the Lieutenant-Governor-in-Council may establish the Authority,
designating the participating municipalities and the area included.
An Authority, properly established, has power to conduct engineering
studies, purchase or erect structures, acquire land through expropriation or
otherwise, plant forests and assess the costs of its activities on the participating
municipalities which, in turn, may issue debentures or otherwise raise the money.
Grants to Authorities may be made by the Lieutenant-Governor-in-Council.
Under the Act, three such Authorities have been granted but the plans are
not yet approved. They are as follows:
Ganaraska Watershed — Plan submitted to the Department.
Etobicoke Watershed — Survey has been made.
Au Sable Watershed — Survey not yet made.
The following four other watersheds are under study:
Thames Watershed — Survey has been made.
Grand River
Humber River
South Nation River
It has been proposed that the following watersheds be investigated:
Moira River
Don River
Sydenham River
(See Map No. 4 concerning Conservation Authorities.)
The developments by any or all of the above Authorities dovetail perfectly
into any major project of reforestation in Southern Ontario. It is desirable that
such schemes be fostered by the Government, as much of the Province's waste
forest-land occurs on the watersheds of these streams. The waste areas mentioned
elsewhere in this chapter include the areas under the proposed Authorities and,
1901
for the purpose of this report, money spent in reforestation in the latter may be
considered as part of the general expenditures for forest restoration throughout
the Province. Every precaution should be taken that these schemes of conserva-
tion do not overshadow the necessity for forest plantations and culture in other
equally devastated areas.
The Act is administered by the Department of Planning and Development,
but the Department of Municipal Affairs and the Department of Lands and
Forests are both vitally interested.
FINANCE
Earlier in this chapter it has been recommended that Provincial
funds might profitably be expended on forestry on private lands for:
(1) Purchase of lands in townships such as Elzevir, Kaladar, Ken-
nebec, Olden, Oso, etc., to prevent their further devastation.
(2) Expanded research activity as to methods of planting, and
species most likely to succeed in swamps and on limestone
plains, etc.
(3) Assistance in fencing of woodlots.
(4) Yearly bonus to be paid on young forests until they reach the
productive stage.
(5) Increase in seed collection and handling.
(6) Increase in nursery production and free distribution of seedlings.
(7) Expanded programme of county, municipal and individual
agreements re forest plantations.
(8) Increase in administrative personnel (District and Zone Forest-
ers and Rangers).
Financing of the above proposals will require a very considerable sum of
money during the coming quarter century, particularly if the restoration of
denuded areas is undertaken on a scale commensurate with the needs. Most
of the proposals would be of a self-liquidating nature and should be considered
long-term investments, rather than expenditures.
Reforestation now costs over $300,000 annually, including seed collection
and preparation, operation of nurseries capable of producing something over
20,000,000 seedlings, and all maintenance and development work in connection
with county, municipal and individual plantations.
I estimate that, in view of the increased personnel needed to carry on the
contacts with landowners, in addition to expansion of nursery staff, seed col-
lectors and administrative personnel generally, the new cost of reforestation
might be seven times the old figure, or $2,100,000. The other new services con-
templated in addition would vary from year to year, but a fair annual estimate
would be:
Purchase of land $100,000
Fencing assistance I 5,000
Bonus for planting and maintenance 50,000
Research 25,000
$190,000
[91 1
Commencing in four or five years, the total for reforestation and service
to woodlot owners would therefore amount to $2,290,000 annually for a period of
10 years, with somewhat increased annual expenditures, possibly $3,000,000,
in the following decade.
The spending annually of sums of money of such magnitude can only be
justified if the situation is grave and if such expenditure will remedy it. I am
convinced that the proposed plan will meet the requirements. I am equally
convinced that the expenditures will prove to be self-liquidating, and in addition
will provide many benefits. We are in the uneviable position of a people who
have borrowed heavily from the future, whose loans are not only due but over-
due, and with nothing to show for what we have spent.
It is unlikely that any major rehabilitation project of this nature can be
financed out of revenue. The cost of the proposed plan should be considered an
expenditure to replace depleted capital assets and the financing done out of
capital raised for the purpose. The proposed expenditures for the reforestation
of Southern Ontario would therefore be financially unrelated to the revenues from
Crown lands situated elsewhere in the Province.
It is the general public, particularly those living in the older portion of the
Province, who will enjoy the major benefits resulting from expenditures on forestry
on private lands. It is therefore the general public, rather than the forest
operators of Western Ontario, who should be the major source of capital for the
expanded development of forestry on private lands.
If, as previously recommended in this report, legislation now existing in
regard to County Forests is amended to include corporations, etc., trust and
insurance companies who are looking for safe long-term investments could
scarcely do better than to invest in the future of forestry in the Province. Govern-
ment Boards, such as the Workmen's Compensation Board, must have difficulty
in finding long-term investments, and no better or safer ones could be found than
in private forestry. Money invested in forests under such agreements will yield
returns which may not be spectacular but will be sure and safe.
I recommend that long-term bonds or debentures be issued, speci-
ally earmarked for assistance in reforestation. It is quite possible that
many public-spirited citizens and corporations would accept a lower rate of
interest than is currently demanded on similar securities, so that they may oe
identified with and share in the forest programme so necessary to the welfare
of the Province.
In ending this chapter I cannot refrain from pointing out that descendants
of the original settlers on the farms of Ontario are rapidly disappearing from the
farms. I feel that this should not be allowed to occur without a sincere effort
to maintain these solid citizens on the land where they can utilize the accumulated
skill and knowledge acquired by several generations of their hardy and resourceful
forbears.
Forestry could well be the means of making the countryside more attractive
and interesting to the rural population and, if wisely developed, can certainly
make the off-season for the growing of field crops the most remunerative portion
of the year. I believe that if forestry is given a chance, it may well prove the
influence which not only will overcome the present attraction of the cities for
rural youth, but which may well reverse the flow and draw back from the crowded
cities, to their proper environment, many of the sons and daughters who have
already left the farms.
1921
CHAPTER VII
Department of Lands and Forests
Before referring individually to the work of the various Divisions of the
Department of Lands and Forests, and in order to indicate how they function,
a few paragraphs will be devoted to the changes which led to the present adminis-
trative set-up.
In 1827, a Surveyor General of Woods and Forests in the Province of Upper
Canada was appointed. He was vested with very wide powers under quite specific
instructions from the Imperial Government, but the Family Compact of those
days was evidently too powerful for him to carry out his duties as instructed.
There was much dissatisfaction about the methods of dealing with the casual
revenues from the disposal of Crown lands or the timber on them, and negotiations
with the home Government proceeded over a number of years.
The Act of Union of 1840, adopted by the Imperial Government, placed
under the control of the Canadian Legislature all territorial and other revenues
at the disposal of the Crown and, in consequence, a Commissioner of Crown
Lands for Canada was appointed to administer these revenues. In return the
Legislature undertook certain obligations, including the civil list for the payment
of the salaries of the Governor, Judges and other personnel, amounting to $75,000
per annum. The first annual report of the Commissioner of Crown Lands appeared
in 1857 as the result of a motion of Hon. A. T. Gait in the House of Commons
during the session of 1856.
Following Confederation, the first Commissioner for Crown Lands for
Ontario was appointed in 1867 in the person of Hon. Stephen Richards, and the
Department of Crown Lands came into being. In 1905, mines were brought
under the Department, and it was named the Department of Lands and Mines
of Ontario. The following year, 1906, the name was changed to Department of
Lands, Forests and Mines and it so remained until 1920, when the administration
of mines was segregated and the Department was renamed the Department of
Lands and Forests.
In addition to mines, various other branches dealing with settlement,
roads, game and fisheries, northern development, etc., have grown up with the
Department as their parent. During 1946 the Department of Game and Fisheries
returned to the Department of Lands and Forests and now carries on as the
Division of Fish and Wildlife.
With the passing of years, many changes in administrative set-up have
occurred. In earlier times there was a Crown Timber Agent and a Crown Lands
Agent in each District and their work was not co-ordinated so as to achieve the
best results for the Province. For many years there was a Provincial Forester
whose work had to do with forest inventories, timber growth, nurseries, fire
protection, etc., but the Crown Timber Agents supervised all cutting and seemed
to look upon District Foresters as visionaries whose views on forestry were far
from practical. If the views of these technical men had been heeded, the forests
of Ontario would be in much better condition than is the case to-day.
193 1
Through the past quarter century there has been a tendency to centraHze
and consolidate the various activities of the Department so that they work in
harmony with one another. The present Deputy Minister is much to be com-
mended for his efforts toward this end. As such consoHdation in a civil service
organization presents many difficulties, due to the tendency to perpetuate old
customs and methods as well as old jealousies, the progress already made is
almost more than could have been expected. In order to achieve this progress,
however, compromises have had to be made and accepted and, because of this,
I believe that the appropriate time has now arrived for another major advance
in organization within the Department.
An examination of the chart showing the present administrative set-up
indicates that the arrangement of responsibilities has several fundamental weak-
nesses:
(a) Each District Forester deals with eleven Chiefs of Divisions who may
issue instructions to him on matters of Departmental policy.
(b) Regional Foresters are in an unnatural position in that they have few
administrative duties and are often by-passed in correspondence between
Chiefs of Divisions and District Foresters. Their positions should be
clarified and either given more weight or abolished altogether.
(c) There are no Assistant Deputy Ministers, but Chiefs of Divisions
function more or less in that capacity. The result is that the Deputy
Minister is overloaded with petty administrative decisions to such an
extent that he has little time for field visits or constructive thought.
(d) Chiefs of Divisions move in such a restricted orbit that they have little
opportunity of acquiring the general knowledge of the Department
necessary to qualify them for further advancement. The result is
that, should it be necessary to select a new Deputy Minister, the logical
choice must be from the field forces who, technically at least, are junior
to and receive instructions from Chiefs of Divisions. Regional and
District Foresters have to deal with practically all phases of Depart-
mental administration.
(e) There is a tendency for each Division to become a watertight compart-
ment. The effect of this individualism is indicated in some of the
material appearing in annual reports. All Divisions supply material to
the Operations and Personnel Division who arrange for the preparation
of the report. Errors appear in it which should be detected if there
were a more intimate chain of responsibility, as indicated on the adminis-
trative chart submitted herewith.
Turning now to the chart showing the recommended administrative set-up,
it will be noted that, instead of seven regions, each witfi a Regional Forester,
who is not an administrator, I recommend three regions, each under an
Assistant Deputy-Minister, who should conduct all negotiations con-
cerning operations in his Region. His decisions, however, must be in
conformity with the policy which emanates from Head Office. Con-
sultation between industry and government concerning operations, leases, sales,
etc., most of which now take place in Head Office, would be conducted through
the Regional Office.
Attention is drawn to the fact that a representative of the Air Service is
allotted to the staff of the Regional Office. His function will be that of adviser
on air matters to the Assistant Deputy who would be responsible for the adminis-
tion of the Air Service in his region. The regional representative of the Air
194 1
Service would be appointed by the Chief of the Division of Air Services. The
Air Service Chief would be considered a staff officer rather than an administrator,
except for the supervision of winter-storage and the overhauling of aircraft.
Two Assistant Deputy-Ministers are recommended at Head Office, one to
control those Divisions which deal mainly with forest operations and the other
one for the remaining Divisions.
Division of Operations and Personnel
I have suggested a change from the confusing misnomer "Division of Opera-
tions and Personnel" to "Division of Administration and Personnel", or "Divi-
sion of Office Management and Personnel". I also recommend that the Educa-
tion and Publicity Section be removed from this Division and set up as a separate
new Division.
Division of Education and Publicity
The possibilities of expanded activities in educational and publicity affairs,
which are developed in a separate chapter, are so tremendous that their control
should not be limited to the scope of a branch within a Division of the Department.
Marketing
I have also recommended a Marketing Division. This could serve as the
co-ordinating agency in the sale of material from private lands and also could
act as an adviser to hundreds of small mills regarding their output and its logical
market. They could maintain statistics as to markets, price-trends, and world
and domestic supplies. In depressed times their advice and co-ordinating powers
could save many small operators from liquidation and the industry in general
from the distress inherent in over-production during such periods.
As mentioned before, marketing advice and assistance to private-landowners
might well be the agent which would bring the vast majority of that group to the
realization of the value of their forests and thereby engender the urge to protect
and perpetuate them.
Accounts and Law
I have placed the Divisions of Accounts and Law in positions reporting
directly to the Deputy Minister. This gives them a status comparable to, but
not the same as. Assistant Deputies. These two are service Divisions to all other
Divisions and Deputies, and should not be under the direction of any executive
below the Deputy Minister.
I recommend that all detailed accounting, all invoicing, collections,
etc., be done in the Regional Offices, with Head Office dictating the
policy and auditing regularly the work of the Regional Offices. Dis-
trict Offices would require cashiers only to receive monies for fish and game
licenses and other small amounts, which would be forwarded to the Regional
Office. This system would eliminate the major delays and errors inherent in
the present system of over-centralization. It would also permit the Regional
Assistant Deputy-Minister to know at all times how individual accounts stood,
and would vest in him the knowledge and authority which Regional or District
personnel now lack in dealing with operators. It is hoped that this would
tend to end the practice of operators going to Head Office to seek favours or
[95 1
to consummate agreements about which the District personnel know Httle or
nothing.
The Law Division needs no counterpart in the Regions or Districts and its
function should be that of interpreting the laws pertaining to forests, preparation
of leases, and day-to-day counsel concerning the problems of the Department.
It must be realized that an individual or corporation enters into negotiations
involving leasing or otherwise obtaining timberlands flanked by the best legal
counsel obtainable. It is the custom, privilege and right of counsel to obtain the
best possible bargain for his client, accentuating those clauses that are favourable
and endeavouring to soften or eliminate those that are unfavourable. I there-
fore recommend that, in negotiating future agreements concerning
timberlands, the Department also employ legal counsel comparable to
that of the applicant. The idea is not novel as many large corporations
maintain a legal branch for routine matters and employ outside counsel in all
major undertakings.
Air Service
A somewhat radical change in the functioning of the Air Service is recom-
mended. I foresee the Chief of the Division functioning as a staff officer rather
than as an operator, setting policy and allotting aircraft to Regions. His main
operational functions should be those of the winter-storage and overhaul of
aircraft at Sault Ste. Marie.
I recorrmend decentralization of field control of the Air Service,
giving to the Assistant Deputy-Minister at Regional Headquarters con-
trol of the aircraft allotted to his Region. On the staff of the Regional
Headquarters would be an officer nominated by the Chief of the Air
Service Division, but under the control of the Regional Assistant Deputy-
Minister. This air officer would act as adviser in all matters pertaining
to the operation of aircraft in the Region and he could serve as liaison
officer between the Division staff and the Regional Staff. This would be
an admirable method of employing the services of pilots who are no longer able
to meet the physical standards required to obtain licenses to operate aircraft.
If the control of aircraft were a function of the senior officer administering
the Region, it would eliminate petty friction which is sometimes in evidence
between Air Service and District staff and it might well eliminate some overlap
in administrative costs.
No Other Fundamental Changes
I do not recommend any other fundamental changes in set-up in the other
Divisions shown on the chart, but will touch on some details in the more explicit
discussions of some of the Divisions later in the report.
I strongly recommend a re-organization along the lines indicated
in the chart, as it provides a rational line of succession leading to the position
of Deputy Minister and places Head Office personnel in the position of staff
officers forming and advising on policy, but leaving the implementation of that
policy to District personnel, who are the logical group to perform that task.
Exasperating experiences involving District personnel and the people with whom
they necessarily deal could thus be avoided. It would eliminate the feeling of
[961
isolation which exists amongst personnel in the Districts remote from Toronto.
They are lucky if they see a Division Chief for a few hours once a year and
several years may elapse between visits from a Deputy Minister. In the more
distant regions there is a distinct impression in the minds of the public that a
barrier exists between those regions and Head Office. They sense the limita-
tions imposed on District and Regional personnel in dealing with day-to-day
problems which could and should be left to the local staff for solution. This
sense of neglect felt by the public and feeling of isolation in the minds of Dis-
trict personnel are very real.
The proposed changes in organization would do away with the present
unnatural position of the Regional Forester who seems to be in a transition stage,
with not enough administrative work or sufficient authority to justify his position.
The situation cannot help but be confusing to most people who have to deal with
District and Regional personnel.
Head Office personnel, notably in Timber Management and Accounts
Divisions, now stagger under a load of administrative work. By being relieved
of much of this detail, they would have time to visit the Districts regularly
and to maintain personal contact with the men on the job, which is so vital to the
success of any undertaking of this nature.
I would not be doing my duty if I proceeded to other subjects without
focusing attention on the lack of assistants to Division Chiefs and key personnel
generally. Assistants trained to take the place of their superiors are almost
entirely lacking in the upper brackets of the Department. This is a most un-
healthy condition which has been brought about by lack of funds and of suitable
personnel at the salaries provided.
It is only because of a sense of duty and a love of their work that many
members of the staff stay in their positions. At that, notable gaps have occurred
in the service even in recent months, despite improved salary schedules. If the
Service is to attract and maintain high-calibre personnel, it must be placed in a
position to meet the competition of industry. Even the security generally sup-
posed to be inherent in Civil Service appointments proved to be somewhat
of a myth in 1934. The Department is only now beginning to recover from the
blow dealt to it at that time. Men who live in fear of their positions work under
a mental handicap which seriously impairs their efficiency. Unless we are
willing to spend the money necessary to employ three or four times the present
numbers of foresters and other technical personnel, including rangers, scalers,
etc., forestry and the maintenance of forests in this Province will continue to
deteriorate, because present staffs are totally inadequate for inspections and
control. In a decade or two, forest industries will begin to shrink, with conse-
quent distress to the communities concerned, loss of revenue and a general
weakening of the economic fabric of the Province.
97]
CHAPTER VIII
Legislation
There are scattered through the Statute books some twenty enactments
dealing directly with the administration, protection and utilization of the Crown
lands and forest resources of the Province. In addition, many other Statutes
bear to a lesser extent upon forest operations, and a still further class relate
directly or indirectly to the practice of forestry on municipal or private lands.
Many of the Statutes lay down general principles and leave the details of
administration to be settled by Regulations made by the Lieutenant-Governor-
in-Council. Such Regulations, when duly passed by Order-in-Council and pub-
lished in the Ontario Gazette, have the force of law. Existing Regulations make
up by themselves a considerable body of rules which are of prime importance to
the operator.
This body of Statutory law has developed over a long period of years and
bears obvious traces of hasty and often ill-considered tinkering. To find the
laws by which his rights and obligations are prescribed, a forest operator must
search through many volumes of Statutes and many issues of the Ontario Gazette,
and having found the relevant Statutes and Regulations he will be perplexed by
their lack of system or arrangement and by numerous ambiguities, inconsistencies
and duplications.
I am heartily in accord with the suggestions made by many cor-
porations, associations and individuals who have advocated a thorough
revision of this whole body of Statutory law and Regulations. It would
be a great convenience to forest operators, forest industries and the public
generally to have those Acts which deal directly with forests and forestry mat-
ters consolidated into a single omnibus Statute, and to have other Acts dealing
more indirectly with the same subject matter grouped together in the Statute
book. The omnibus Statute to which I have referred might be divided into
parts along the following lines:
Part I
A consolidation of Statutes which provide for the administration, protection
and utilization of Crown lands and forests including such Acts as:
1. The Crown Timber Act, R.S.O., (1937) Ch. 36.
2. The PubHc Lands Act, R.S.O., (1937) Ch. 33.
3. The Forest Resources Regulation Act, R.S.O., (1937) Ch. 40.
4. The Forestry Act, R.S.O., (1937) Ch. 39.
5. The Cullers Act, R.S.O., (1937) Ch. 240.
6. The Mills Licensing Act, R.S.O., (1937) Ch. 37.
7. The Provincial Forests Act. R.S.O.. (1937) Ch. 38.
8. The Provincial Parks Act. R.S.O. (1937) Ch. 94.
9. The Pulpwood Conservation Act, R.S.O., (1937) Ch. 41.
10. The Spruce Pulpwood Exportation Act, 4 Geo. VI, Ch. 27.
11. The Woodmen's Employment Act, R.S.O., (1937) Ch. 202.
1981
Part II
A consolidation of Statutes dealing with forest protection including such
Statutes as The Forest Fires Prevention Act, R.S.O., (1937) Ch. 325; The Rail-
way Fire Charge Act, R.S.O., (1937) Ch. 326; The Fire Guardians Act, R.S.O.,
(1937) Ch. 327.
Part III
A consolidation of the Statutes dealing with the use of lakes and streams for
logging purposes including The Lakes and Rivers Improvement Act, R.S.O.,
(1937) Ch. 45; The Bed of Navigable Waters Act, R.S.O., (1937) Ch. 44.
Part IV
A revision of the present Game and Fisheries Act, 10 Geo. VI, Ch. 33.
Part V
A consolidation of the laws relating to forestry on private and municipal
lands including such Statutes as:
1. The Municipal Reforestation Act, R.S.O., (1937) Ch. 323.
2. The Settlers' Pulpwood Protection Act, R.S.O., (1937) Ch. 42.
3. The Private Forests Reserves Act, R.S.O., (1937) Ch. 324.
4. The Trees Conservation Act, 10 Geo. VI, Ch. 102.
5. The Nursery Stock Act, R.S.O., (1937) Ch. 43.
It is not feasible to include in a general Statute or collection of Statutes,
such as mentioned above, every incidental reference in the Statute books to
forestry matters; for example. The Mining Act, The Assessment Act and The
Municipal Act all have sections of more or less importance relating to forestry
or farm woodlots, but I do not suggest that the proper place for these long Statutes
dealing mainly with other subject matters is in a collection of forestry and public-
lands enactments. The consolidation which I have suggested might, however,
contain a reference to particular sections of other general Statutes.
It need hardly be said that no revision or consolidation should be carried out
until after careful study by the best legal talent available and after consultation
with industry. Hasty or ill-considered action in this respect might well result in
even greater confusion than now exists.
It is beyond the scope of this report to examine in detail the provisions of the
Statutory law and Regulations now in force. It will be the task of legal experts
to bring order out of the present confusion and to eliminate the uncertainties and
inconsistencies which now exist. There are many points, however, upon which a
definite policy will have to be formulated before the task of amendment and
consolidation can be undertaken, and among these points I wish to call special
attention to the following:
1. The obvious intention of The Crown Timber Act is to prohibit the export
of unmanufactured wood. The power given to suspend the operation of
the manufacturing conditions "for such periods as may seem proper and
as to any district or districts which may be defined " is, in my judgment,
intended merely as an exception to the dominant policy laid down by
the Statute. The exception has now grown more important than the
1991
rule, and if the present export policy is to be continued it should be clearly
and explicitly authorized by the Statute itself.
2. Criticism of Ontario forest administration over a course of years has been
founded mainly on the lack of a known and stable policy on essential
points. Existing legislation confers on the Minister and on the Lieu-
tenant-Governor-in-Council powers sufficiently wide to enable complete
reversals of policy to be carried out without reference to the Legislature
and without any notice to the public of what is being done. I am abso-
lutely convinced that until the public generally, and those who are con-
cerned in forest industries in particular, can feel confident that sound
policies once adopted will not be abandoned to meet political exigences
or at the whim of a Minister, there will be no satisfactory administration
of our forest resources. I do not overlook the disadvantages inherent
in too rigid a system, but I believe that, in the main, sound general
policies once adopted should be embodied in Statutes where they are
safe from interference without legislative action.
3. The Forest Resourses Regulation Act has aroused more critism and dis-
satisfaction on the part of limit holders than any other forestry law. It
is attacked on the grounds that the power to interfere with contractual
relationship can be exercised at the arbitrary discretion of the Minister
of Lands and Forests, that such a power is a threat to secure tenure and
that it will retard the application of management to forest lands.
In view of the failure of existing contracts to give the Crown any right
to reduce the size of limits which prove more than adequare for the
needs of the limit holder, I do not favour the repeal of the statute
in toto, but would recommend amendments to ensure
(a) that the power to interfere with contractual rights could
be exercised only after the court or some other indepen-
dent body had found as a fact that the limits held by a
lessee were more than sufficient for his needs;
(b) that stumpage rates could be altered only in order to
bring them into line with rates generally prevailing and
not, as the Statute now provides, as a blanket penalty for
bad forestry practices or improper dealings with labour.
In my opinion, more attention has been focused on this Statute than its
importance warrants. In this connection, the following points might be
kept in mind:
(a) Every agreement made since the enactment of the Statute in
1936 has been expressly made subject to all Statutes of the
Ontario Legislature. In obtaining rights to cut timber on Crown
lands, every operator since 1936 has, with his eyes open and
knowing the obnoxious Act to be on the Statute book, chosen
to go ahead.
(b) The constant plea for security of tenure is greatly overdone-
Nearly every operator in the Province has committed breaches
of the terms of his agreement which would justify cancellation,
not pursuant to the Statute, but pursuant to the contract itself.
Fears for security of tenure have not had much weight in such
cases.
I 100 1
(c) Other Provinces grant mere annual cutting rights and operators
there appear to carry on without too much difficulty.
4. Section 23 (4) of The Forest Fires Prevention Act, which was added in
1946, provides that when fire originates in any particular area in which
summer operations are carried on under permit, in the absence of evidence
to the contrary, satisfactory to the Minister, the fire shall be presumed
to have resulted from such operations and the operator shall bear the
full cost of controlling and extinguishing the fire. This section is con-
trary to one's ideas of fair play and British justice and should be amended
so as to throw the burden of proof on the Crown and to substitute the
decision of the Courts for that of the Minister as to the sufficiency of
evidence.
5. Provision should be made for the holding of an enquiry at the request
of the District Forester, by properly qualified officials appointed therefor,
immediately after a fire has occurred in order to determine responsibility
while memories are fresh and witnesses available.
6. A great deal of confusion exists in respect of unopened-road allowances
in Township Municipalities, especially in the less settled parts of the
Province. I recommend that this subject should be considered
and that the law should be clarified. It might be advisable to pro-
vide that municipalities should be required, within a limited time, to
specify what road allowance they intend to make use of and that those
not so specified should revert to the Crown.
7. Consideration should be given to incorporating into the Statutes many
of the details which are now governed merely by Regulations. Many
of the Regulations which have been in force over a long period of years
have stood the test of time and have proved their usefulness. The in-
clusion of such Regulations in Statutes will assist in stabilizing forest
policies.
8. As has been recommended in an earlier chapter of this report,
The Municipal Drainage Act and The Ditches and Water Courses
Act should be amended immediately in order to curtail the detri-
mental effect of those Statutes upon woodlots and farmlands in
the southern parts of the Province.
When the work of revision and consolidation has been completed,
1 recommend that copies of the relevant Statutes and Regulations be
made available to the public in loose-leaf form and that supplements
covering annual amendments and additions be supplied.
CHAPTER IX
Timber Management
The Division of Timber Management keeps inventories of forest resources
and deals with all timber applications, sales and licenses. Its functions also
include the supervision of pulpwood exports, of working plans and of the arrange-
ments for the scaling of wood and the inspection of cutting operations; in addi-
tion it maintains records in connection with cutting operations and pulpwood
exports.
Its position as the source of advice to the administration on matters per-
taining to the leasing of timberlands and the setting of rates for stumpage and
ground rent, and its action in devising and implementing cutting regulations,
makes it the most important Division dealing with Crown lands.
Because of these key functions it is almost inevitable that it should exert
a tremendous influence in maintaining existing policy, or shaping new policy,
following a change of government or even of Ministers. As a civil servant has
few, if any, adequate means of preventing precipitate or unwise action by those
in power, whether or not he agrees with such action, it is difficult to strike a
proper balance now, concerning the responsibility for what has taken place over
the years, as between successive governments and their civil service advisers.
Some of the transactions which have been carried out, particularly in
Western Ontario, are difficult to explain or justify in the light of present-day
knowledge. Vast areas of forest lands were leased, with the construction of a
small mill included in the terms of the agreement. The size of the mill specified,
when viewed in relation to the size of the area involved, suggests that speculation
in standing timber was the real reason for many of the transactions. Few of
the mills were ever built though the traffic in timberlands continued. A few
years ago timberland, leased to companies with mills in operation, was with-
drawn and re-allocated to a new company having only the project for a mill,
without sufficient regard for the future of either the existing mills or the one
proposed.
PRODUCTION OF SAWLOGS BY PULPWOOD OPERATORS
Practically all pulpwood agreements contain clauses providing that the
Minister may direct that sawlogs shall be cut as such, but there is a bewildering
variety in the form of these clauses as they appear in the different contracts.
The practical result has been that few sawlogs have been produced on the basis
outlined, although a couple of pulp and paper companies supply considerable
quantities of logs to sawmill operators under private arrangements with the
operators involved.
The futility of the sawlog clauses in existing agreements was well demon-
strated during the 1942-43, and 1943-44 cutting seasons. Great Lakes Lumber
and Shipping Limited, with little in the way of timber resources, was permitted
and even encouraged to build a large sawmill in Fort William, during the early
days of the war, in order to assist in meeting the critical needs for lumber.
f 102 1
On account of the existing woods-labour situation, coupled with the inherent
reluctance of many pulpwood operators to deal with sawmill operators, the large
new mill of Great Lakes Lumber and Shipping Limited received insufficient logs
to operate to capacity.
The Minister of Lands and Forests attempted to supply the mill with logs
by asserting his right to require the production of sawlogs by several pulp and
paper companies operating in the Lakehead area and on the north shore of
Lake Superior.
When each individual contract was studied it was found that no general
formula or instructions could be applied to achieve the desired result. Under
pressure from the Department, however, several companies produced a total of
some hundreds of thousands of logs without any guarantee that they would be
accepted by the prospective purchasers. They were not accepted and much
argument ensued, with another Lakehead sawmill eventually purchasing most
of them. A Royal Commission, set up to suggest a solution to the difficulties
which had arisen, discovered the conditions to be as related above but finding
that the problems presented involved enquiries far beyond the scope of the
Commission then existing, they did not make any final report.
The major source of sawlog supply for the mill of Great Lakes Lumber and
Shipping Limited is provided by two Orders-in-Council permitting this company
to cut logs on pulpwood concessions.
Under an Order-in-Council dated 18th September, 1940, the Minister of
Lands and Forests was empowered to enter into an agreement with the above
mentioned company to cut spruce over II inches in diameter 18 inches above
the ground and balsam on various limits as follows:
Abitibi Power and Paper Company Limited 435 square miles
Lake Sulphite Company Limited (now Brompton
Pulp & Paper Company Limited) 205
Nipigon Corporation Limited 90
A subsequent Order-in-Council dated 28th April, I 94 I , similarly approves an
agreement to cut large-size spruce, balsam, jack pine and poplar sawlog timber
on the limits of the Pulpwood Supply Company Limited (Long Lac Concession,
then comprising 2,616 square miles).
These Orders-in-Council are still in effect although Departmental permis-
sion to cut is at present confined to the first mentioned parcel, namely that of
the Abitibi Power and Paper Company Limited.
Such arrangements are at best a makeshift and must be highly irksome to
all concerned. The sawmill lacks assurance of continued supply and the pulp
and paper companies involved cannot accurately estimate the effect that possible
cutting programmes for sawlogs may have on their future sources of pulpwood
supplies.
I am convinced, particularly in times when woods labour is scarce, that
any effort to provide sawlogs under the terms in existing agreements will meet
with similar inconclusive results and that the problem can best be solved by the
application of the recommendations in the final chapter of this report.
The pictures on the next page and on page 44, indicating the presence
of sawlogs on pulp and paper company limits and the use of these sawlogs as
[103 1
Piles of eight-fool pulpwood containing much material suitable for sawlogs. {Domestic company operation.)
Pulpwood of sawlog size. Diameters may be judged by comparison with the hat. {Domestic company operation.)
pulpwood, are illustrations of a condition which I found to exist generally through-
out the northern and western parts of the Province.
The question of sawlog production is not the only one which requires remedial
action. There are many inconsistencies due to the infinite variation in pro-
visions of licenses as well as agreements.
VARIOUS TYPES OF LICENSES AND AGREEMENTS
In addition to contracts resulting from the acceptance of offers for timber
put up for sale by public tender and involving comparatively small areas, there
are now in force some 51 so-called timber and pulp concession agreements.
These agreements are for long terms, either 10 or 21 years, and usually with a
right of renewal, and they deal with areas of considerable extent. They may
be divided into three main classes:
(a) Agreements conferring the rights to cut sawlogs only.
(b) Agreements conferring the right to cut pulpwood only.
(c) Agreements conferring the right to cut all classes of timber.
The agreements conferring the right to cut pulpwood only and those con-
ferring the right to cut all classes of timber may be further sub-divided into the
following classes:
(i) Agreements requiring the operation of a domestic pulp and paper mill,
with or without export privileges,
(ii) Agreements permitting the export of pulpwood but not requiring the
operation of a domestic pulp or paper mill.
Agreements at present in existence have practically all been negotiated
within the past 20 years, with a majority in the past ten years. Some of the
present-day agreements are based on, or are renewals of, earlier agreements
which were entered into in the early I920's. The form in which the funda-
mental provisions are stated varies from year to year and there is a marked lack
of uniformity in the case of agreements falling within the category of any one
of the single classes mentioned above. One can only conclude that in respect
to many important details, a general line of policy has never been adhered to,
and that each individual contract is the result of a process of bargaining in which
the interests of the Crown have not always been fully safeguarded.
Some agreements concerning sawlogs specify payment of stumpage on the
basis of Doyle Rule, while others specify a rate per M feet board measure but
do not mention Doyle Rule. The fact that the rule is mentioned in some agree-
ments prevents its abolition merely by regulation, and necessitates a Statute
to do so if such is desired.
Increased pulpwood exports permitted from Crown lands make it apparent
that the Department has adopted the practice as a policy, but apart from the
decision as to the general principles involved, there seems to have been little
thought given to the terms and conditions under which the rights of export may
be exercised. This is exemplified by the fact that some agreements (notably
some of the later ones) require the building of a pulp mill in Ontario while others
carry no obligation of this sort. The quantity permitted to be cut per acre per
year varies very widely and in many cases grossly exceeds the annual growth
under the cutting methods used. In other instances the agreem.ent only covers
1105 1
the cutting of spruce and balsam pulpwood, thereby placing the cutting opera-
tions practically on a mining basis. In one agreement "pulpwood" is specified
without mentioning the species.
It would probably be futile at this late date to attempt an allocation of
responsibility for the diversity of terms in the various agreements. Provided
that immediate action is taken to correct, simplify and standardize conditions
so as to ameliorate the mistakes of the past and guard against those of the future,
little purpose would be served in endeavouring to apportion blame.
There are several points about the agreements, some of minor importance
but others of a more serious nature, which should be considered:
(1) Agreements involving the export of unprocessed pulpwood are all based
on a clause in The Crown Timber Act which provides for such practice as an
exception. The whole structure of the Act argues against the export of un-
processed wood; but agreements, involving many thousands of square miles of
timberlands, have been executed for long-term periods based on the exception
to the rule. This subject will be developed in Chapter XV on Export of Pulp-
wood.
(2) In nearly every case it is provided that the agreement shall be subject
to all Acts of the Legislature, which are now or which may hereafter be in force,
and all regulations duly made under the provisions of any such Acts, so far as
they are of general application.
It is quite right to stress the fact that the Legislature has the power to
change or nullify by Statute any or all agreements with the Crown. Operators
should fully understand this fact and no term should be permitted in a contract
which appears to limit the rights of the Legislature in this respect.
(3) In many cases, particularly in export contracts, the operator is required
to cut a minimum number of cords each operating season and is permitted to
cut up to a stated maximum. The same contracts require the concessionnaire
to operate in accordance with good forestry practice, and to file a working plan
providing a general scheme for the operation and management of the area so
that it will be kept productive, all in accordance with The Pulpwood Conserva-
tion Act. These provisions appear to be quite inconsistent; the question will
arise which is to prevail if the plan filed establishes the fact that, by practising
good forestry the maximum, or even the minimum, cut cannot be allowed.
This difficulty could easily be avoided by making the paragraph which
deals with quantities "subject always to the right of the Minister to restrict the
cutting if, m his opinion, good forestry practice so requires."
(4) All operators are now required to file working plans. In some cases
agreements expressly provide that, if the inventory reveals a shortage of wood,
further areas will be made available; but no single contract permits the Minister,
upon it being established that an operator has more timber than he requires, to
decrease the acreage. In such a case, of course, the Crown is not left without
remedy. It can exercise its powers under The Forest Resources Regulation
Act; but it seems unfair that, while the operator may rely on his contract for
the protection of his interests, the Government may be compelled to have re-
course to an unpopular and much critized piece of legislation in order to protect
the legitimate interests of the public.
M061
(5) Provisions as to the duty of operators in making and filing operating
plans have varied widely since they were first embodied in Concession Agree-
ments. These provisions have been revised and greatly elaborated in some of
the latest Agreements, but the utilization of the information included in the
plans is not clearly stated. If, as I believe, it is intended to be used in operating
the area in such a manner as to keep it productive in perpetuity, then this aim
can be more clearly and simply stated.
(6) Provisions added in some of the newer agreements dealing with co-
operation in the purchase of settlers' wood, state that all bona fide accounts due
for settlers' pulpwood purchased by the operator shall constitute a first claim
against the operator. I regard this clause as meaningless. The Crown surely
cannot confer a prior right to the payment of one class of creditors as against
other classes by an agreement to which none of the creditors is a party. The
provision is misleading and might easily make settlers think that they have
some protection against bad debts, whereas none is provided by this clause. It
is possible that the Crown merely intends to authorize the company to give
settlers' claims priority over its own.
(7) The amount of cash deposit varies widely and does not appear to be
related to either the area of timberland involved or to the investment the oper-
ator has made in mills or improvements. The amount of deposit should bear
a fixed relationship to the amount of the companies obligations in respect of
annual dues and charges.
(8) The wording used in one agreement purports to permit the operator
to continue the export of unprocessed pulpwood for the full term of the contract
(till 1962) "notwithstanding any Statute which might be passed to the contrary".
I contend that the clause is meaningless and does not bind the Crown. If, as
was stated at the public hearings, the purpose of this clause was to make it
easier for the company to arrange its financing in the United States, I regard its
inclusion as highly improper.
DRAFTING OF AGREEMENTS
It is very strongly recommended that the policy of the Department
in respect of such matters as the conditions under which export will be
permitted, the production of sawlogs by pulp operators, the production
of pulpwood by timber operators and the production of pulpwood for
domestic mills, should be definitely determined and a standard, care-
fully prepared form of agreement adopted which would meet the re-
quirements of every individual case. It is true that there are some details
which obviously must vary with each agreement, but apart from these few,
there are many matters of general application (or which should be of general
application) to all operators, such as:
Right to use watercourses.
Deposit of security.
Payment of 20 per cent of the stumpage dues in advance each season.
Preparation of inventory,
Filing of working plans.
Purchase of settlers' wood.
Minister's consent to yearly operations.
Payment of ground rent and fire tax,
Measurement of pulpwood,
1 1071
Qualifications as to purpose for which exported pulpwood shall be used,
Returns,
Right of inspection.
Pollution of streams.
Applicability of Statutes,
Pulpwood for domestic use.
Production of lumber by pulpwood operators.
Labour,
Default, etc.
All of these general matters should be omitted from the individual contracts and
replaced by a single general provision that the contract shall in all respects be
subject to the provisions of all Statutes now or hereafter in force and to all
regulations made thereunder.
The advantages of such a course are almost too obvious for comment, but
the following points may be briefly referred to:
(a) Great saving of time in drafting agreements and less possibility of mis-
takes;
(b) Encouragement for the formulation of a definite and fixed policy cover-
ing all details of operation;
(c) Facility in effecting a change of methods over the entire industry by
regulation;
(d) Equal treatment of all operators.
A carefully worded agreement prepared in consultation with the best legal
talent available would prove good protection, not only for the Departmental
officers, but for the public as well. Such an agreement should not, however,
be looked upon as a substitute for a firm and enlightened over-all forest policy.
ALLOCATION OF LIMITS
I consider the present allocation of Crown lands to limit holders to be il-
logical and uneconomic in many instances. Often there is little apparent rela-
tionship between the size and location of the limits and the location and capacity
of the mills served by them. Some units of industry have more than enough
resources to support them, while others cannot maintain their presert production,
still less increase it. The right is granted to export large quantities of pulpwood
cut on limits which could properly support domestic industry, while more distant
forests remain unharvested. Generally speaking, the pulp and paper group —
both domestic users and exporters — is better served as regards limits than the
domestic manufacturers of lumber, ties and poles. Most of these conditions
are wasteful of the Province's resources and all are unsound from the long-term
viewpoint.
It should be pointed out that manufacturers of lumber, ties and poles are
themselves largely to blame for their present situation. When limits were avail-
able they did not undertake the obligations inherent in the leasing and holding
of Crown lands, but for the most part chose to operate on a shoe-string basis,
with the result that many of them must now subsist on material purchased
from pulpwood concessions. Extensive areas of timberland are no longer avail-
able in proximity to most of the existing mills. Unless remedial measures are
taken, many of the mills will disappear within the next decade or two.
[ 1081
Leasing of areas for single-purpose operations has been a long established
practice but such operations create, and will continue to create, a tremendous
waste of timber. Elimination of single-purpose logging operations should be
given the very earliest consideration possible.
INSPECTION AND SCALING
The inspection of woods operations is most inadequate. This is due largely
to lack of staff which, in turn, is the result of non-competitive wage schedules
and working conditions. Top rates during 1946 for casual personnel employed
as fire rangers, towermen, etc., was $4.00 per day, with the individual providing
his own board. During the same season, sawmill workers were earning almost
twice as much, pieceworkers on pulpwood operations were earning three times
as much and many pieceworkers producing poles were earning four times that
amount. It is therefore not difficult to imagine the problem the Department
faced, both in obtaining new men and in retaining their staff.
The problem of obtaining new and suitable personnel is very real and must
soon be solved, as the average age of scalers, rangers and towermen is now very
high, the majority being past middle age. Recent efforts made by the Depart-
ment to lower the average age and generally improve the efficiency of scalers and
rangers is most commendable but it should be accelerated. Like all similar
programmes, it will result in apparently increased expenditures, but the savings
thereby made possible will reimburse the government many times over.
The Division has produced an excellent manual on scaling for the guidance
of the field staff, and has promulgated many regulations dealing with most
phases of woods operations. Unfortunately these have not been combined in
a concise booklet and are not uniformly known or applied by all concerned. I
have observed many instances of differences in methods or policy on the part of
scalers in different districts and even in the same district. This would be inex-
cusable and probably would never occur if all regulations were consolidated into
one booklet and copies were supplied to the Districts in numbers sufficient to
distribute a copy to every party interested, including the operators. It would
pay to do this, despite the expense and work entailed in frequent revisions.
I am firmly of the belief that the Air Service could be more widely used to
good and economical effect in winter inspection and scaling operations and I
have referred to the suggestion in Chapter XI on the Provincial Air Service.
STATUS OF SCALERS
The question of the status of scalers is one that I consider most important. A
scaler working on an operation is normally dependent upon the foreman or
jobber for housing and food. If he is unpopular with that individual because
of his insistence on the observance of regulations, he may suffer, particularly in
the matter of sleeping accommodation, and his stay in the locality can be made
most unpleasant. It is recommended that for the future, scalers be pro-
vided with private cabins and beds on all but minor operations, and
that a ticket system should be instituted, whereby they can exchange a
ticket for a meal in any camp, with the government reimbursing the
operator at the end of each season for all meals supplied.
In this manner, the scaler would be entirely independent of the operator
and far more likely to scale and inspect in an unbiased manner. He should
1 109 1
never be forced into the position of a suppliant to the operator for benefits of
one sort or another. It is my contention that the status of scalers and inspection
personnel generally should be raised, so that when they arrive on an operation
they will be treated as men of consequence and therefore commanding respect.
This is definitely not the condition now existing. The wearing of a distinctive
uniform will do much to alter this. No doubt a few of them may, in the initial
stages, be inclined to overestimate their own importance, but this tendency
could easily be checked.
In questioning scalers in widely separated areas as to why certain wasteful
practices were tolerated many of them stated they were afraid that, if they
insisted on compliance with regulations, the influence of the operators would
cause their removal to another locality at considerable cost and inconvenience
to themselves and their families. I found no case in which such action had
been taken and I do not believe there is any likelihood of it, but I have no doubt
that some foremen and jobbers may have used the threat. I mention the matter
because the fear undoubtedly exists in the minds of the scalers. It should be
allayed.
TIMBER RETURNS AND ACCOUNTING
Varying clauses in agreements, as well as wide ranges in stumpage rates in
hundreds of licenses, create a condition which places an unnecessary and ex-
asperating load on the accounting personnel in District Offices. It takes months
to carry out and check work which should require only days if conditions were
standardized.
The following tabulation will serve to emphasize the above statement.
Only a few species are included, but they illustrate the general condition.
Sawlog Stumpage Rates in Effect
White and red pine. .89 rates varying from $2.50 to $23.75 per M. f.b.m.
Spruce and balsam. . .82 rates varying from 2.00 to 13.50 per M. f.b.m.
Jack pine 78 rates varying from 2.50 to 1 3.25 per M. f.b.m.
PuLPwooD Stumpage Rates in Effect
Spruce 49 rates varying from $1 .40 to $4.25 per cord
Balsam 45 rates varying from .70 to 3.00 per cord
Jack pine 26 rates varying from .40 to 2.75 per cord
DEFINITION OF A CORD
There is no standard "cord" recognized by the Government of Ontario for
the assessment of stumpage, although a cord is defined by Act of Parliament.
On woods operations on Crown lands, the cord may consist of any one of the
following:
(a) Unbarked wood — 4' x 4' x 8' with an overlength tolerance of 2" per
stick, or roughly four per cent. The volume of a well piled cord of
unbarked sticks of medium size will amount to about 88 cubic feet of
solid wood -(-four per cent for overlength, or 884-3.5=91.5 cubic feet.
(b) Barked wood — 4' x 4' x 8' with no tolerance for overlength. On
medium-size wood the removal of bark permits of more solid wood per
1 1101
cord to the extent of 14 per cent or 15 per cent. The volume of a well
piled cord of barked sticks of medium size is therefore 88X1.14^100.3
cubic feet.
(c) Where longer logs are utilized for pulpwood and measured by cubic
volume, stumpage is levied on the basis of 100 cubic feet=l cord.
It should be emphasized here that, under the piecework system in this
Province, the practice of barking pulpwood in the forest is extremely wasteful
of raw material. Pieceworkers almost invariably leave all partially dry logs,
or those with many knots, to rot on the ground because both are difficult to
peel and therefore interfere with production and earnings. Such logs may
usually be found concealed under brush heaps, although many are brazenly left
in the open.
ANNUAL REPORT
The Annual Report of the Department of Lands and Forests should, I
believe, be primarily concerned with keeping the public informed concerning
their forest heritage. Many reports in the past couple of decades give the im-
pression that they were prepared from material assembled in providing answers
to questions of a Minister, rather than for the purpose of informing the public.
That for 1945 is a considerable improvement over its predecessors but the
portion pertaining to timber management could be further improved by a con-
solidation of the total cut of each species with the total revenues received there-
for. The revenues from material cut under permit are not shown, though in
the aggregate they amount to a considerable sum.
Nine-inch dry sfiruce top wasted because it was difficult to peel. (Pulpwood-exporting company operation.)
1
i#
■■9m^
9P^:"*"
^'S^'-^.^^f^^^^C^
I consider that the tabulations concerning small areas of timber sold or
abandoned could be summarized, so as to show total areas for Districts with
price ranges for these Districts, and the picture so revealed on one page would
be more striking than that contained on the ten or more pages now used.
It does seem that something could be done to expedite the process of bring-
ing information concerning a season's operations before the public. Information
in the report for 1945, which has been circulated in April, 1947, deals with the
timber-cut of 1943-44 harvested under wartime conditions. The timber agree-
ments included were also signed in 1944. I suggest consideration of the possi-
bility of having the period covered by the report different from that of the fiscal
year. In New Brunswick all operations till October 31st in any year are in-
cluded in their annual report which is issued to the public in the spring of the
following year. In this manner, information is received before it is too late
to take remedial action if such is necessary and, in addition, the report can be
tabled at the session of the Legislature following the cut.
I recommend that study be given to ways and means of speeding up
the preparation and issue of the annual report, as well as in re-arrang-
ing and consolidating tabular information so as to give the most com-
plete picture possible from the information on hand.
MAPS AND STATISTICAL INFORMATION
A more comprehensive system of filing and tabulating data concerning
licenses, agreements and information on wood exported would be of much benefit
in the Division of Timber Management. The present system does not make
information readily available, although it can usually be obtained eventually.
The lack of over-all up-to-date maps retards the search for information, which
is spread over dozens of small map-sheets and, in some instances, does not agree
with the data provided in District offices. This, I believe, has been responsible
for a couple of instances in which it was noted that similar rights were conferred
on two companies for the same area.
I recommend an overhaul of the office administration and filing
system in the Division of Timber Management.
2]
CHAPTER X
Forest Protection
Most of the public think of forest protection in terms of fire prevention and
fire fighting alone. In its studies, this Commission has adopted a more com-
prehensive viewpoint leading toward control of all destructive agents which
threaten our forests, whether they be men, animals, insects, diseases or the
elements.
CONTROL OF HUMAN BEINGS
Most chapters of this report deal with the elimination of the waste and loss
which may be attributed to human agency. They may quickly be controlled
and minimized by sensible regulations uniformly and, where necessary, rigorously
enforced, and amended from time to time as research indicates such need.
Education as to the ownership of our forests, and the fundamental role they
play in maintenance of our national prosperity and enjoyment, should eventually
remove the need for many punitive regulations. Unfortunately some restrictive
measures will always be required to protect the public from the greedy or thought-
less individual or corporation. Such measures will have to be accepted by those
whose actions do not require them, as well as by the culprits who make them
necessary.
CONTROL OF ANIMALS
It is not generally recognized that, though they derive little benefit from
it, cattle grazing in the forests cause greater damage to the forests than any
other action attributable to animals. The loss so caused on farm woodlots is
tremendous and, as mentioned in Chapter VI on Private Lands, could be elimin-
ated by fencing.
In my opinion, of the forest losses attributable to animals, the extent of the
damage caused by porcupines is second only to that of grazing cattle. They
remove very considerable areas of bark from trees, in many instances killing
them by girdling, but in any event so weakening them that they are a prey to
disease. During the past season I have seen tens of thousands of trees, mostly
jack pine, so damaged and I would estimate that the total numbers affected
throughout the Province must therefore amount to many millions. This con-
stitutes a very serious loss and I have not been able to discover any specific
compensating factor.
There is a widely held idea that porcupines are protected because they are
one of the few animals a lost and hungry man can capture and kill easily. In
many years of wide contact with woodsmen, hunters and forest travellers gener-
ally, I have never met nor heard of anyone who had, of necessity, caught and
eaten a porcupine. I have been told of a few instances in which porcupine
flesh has been eaten by humans, but in all cases it was curiosity rather than
necessity which prompted the action.
[113]
Balsam and white spruce stand badly damaged by spruce budworm. Such timber should
be salvaged immediately .
No legal protection for porcupines actually exists. In the Maritime Prov-
inces there is a bounty for their destruction. However, as a result of the im-
agined protection in Ontario, the porcupine population has, I believe, increased
beyond the needs of the biological balance of our forests. I recommend that
for a few years the killing of porcupines be encouraged and that research
be carried on, in the meantime, to ascertain the minimum population
needed.
The extra protection afforded to beaver in recent years has apparently been
effective in increasing their population and the results of the new colonies start-
[ 1141
ing up are evident over widely scattered areas. In order to flood their lodges
they dam small streams at strategic points, causing water to spread over con-
siderable areas, which inevitably kills the trees on the areas so flooded.
A widespread survey of this damage, studied in conjunction with an analysis
of any economic and other benefits resulting from the beaver population, is
necessary before formulating a policy. It is possible that the beaver may be
more valuable than the forests affected, but many thousands of acres, mainly
of pulpwood forests, are involved.
CONTROL OF INSECTS
The ravages of forest insects are less spectacular than those of forest fires
and, consequently, the losses attributable to them have never received the pub-
licity justified by their magnitude. With the improved and efficient fire-pro-
tection methods now practised and their probable further improvement and ex-
tension, it is expected that losses from forest insects will, in the future, far exceed
losses from fire.
The spruce budworm epidemic, now extremely serious in the Province, has
already killed hundred of thousands of cords of balsam in widely scattered areas
and threatens many millions of cords of balsam and white spruce throughout
the province.
The present outbreak was first noticed in the areas adjacent to Sault Ste.
Marie in 1936, but it has spread widely since that time. In addition to an ex-
tensive destruction of balsam in that region, the ravages are plainly seen over
large areas between North Bay and Timagami, south of White Lake, southwest
A healthy young stand of mixed softwoods. Compare with the illustration on the opposite page.
. 'J \
•^
•^w^
>M»
■v \
>'-f'
'■W'.
and west of Lac Seul and in the neighbourhood of Lake Nipigon. This last
mentioned outbreak is the most serious as the area covered is large and carries
a very valuable stand of timber; in addition, the insect has seriously attacked
and is killing white spruce as well as balsam. Salvage of damaged timber,
some already killed, some dying, is imperative and should not be de-
layed.
There are minor areas of budworm-killed timber widely scattered but the
areas specifically mentioned are those where virtually complete destruction of
mature balsam has occurred over a large number, in some cases hundreds, of
square miles.
Spraying with insecticides such as D.D.T., which is very costly, has not
been completely successful in combatting the pest and results to date indicate
that future action of this sort will only be justified in combatting incipient out-
breaks when very intensive treatment can be repeatedly applied to a few square
mdes.
Possible control measures on a wide scale lie in the discovery of some virus
disease which will kill the spruce budworm at some stage in its life-cycle, or in
some fungus disease which will destroy it when in the dormant pupal stage.
Vigorous research in these directions is already being conducted. Research in
the possibility of control through some virus disease has been started in Europe,
mainly in Germany, where an insect similar to our spruce budworm is held in
check by some undiscovered influence, possibly disease. Studies of the possi-
bilities of fungus attack are being made, at the Forest Insect Laboratory in Sault
Ste. Marie, which are very promising.
It is doubtful if any economically feasible remedial measure will be de-
veloped in time to end the present epidemic before it subsides of natural causes.
Such outbreaks occur at varying intervals and it is to be hoped that the entomo-
logical activity engendered by the present outbreak will culminate in knowledge
which will enable us to stamp out coming epidemics while they are in their
incipient stages. It is extremely probable that such knowledge will be obtained.
There is also a jack pine budworm active in the English River district, west
of Lac Seul, with an incipient outbreak of the same insect southeast of Chapleau.
The latter situation only developed in 1946 and it will be interesting to see
whether or not it is possible to control it by spraying with insecticide.
It must be realized that all the native insect pests are always present in
our forests. Fortunately these pests all have their parasites and predators
which normally keep them under control. These pests, however, are not ap-
parent to the ordinary person until such time as conditions extremely favourable
to their propagation permit them to outstrip, temporarily, the breeding capa-
bilities of their parasites. An epidemic condition then occurs which rages until
the population of parasites and predators can build up numbers sufficient to
restore nature's balance once more.
When foreign insect pests happen to find their way into our forests, possibly
none of the native species of parasites will attack them and, in consequence,
they may multiply unchecked and do tremendous damage before they are recog-
nized and remedial measures are taken for their control. This was the case of
the spruce sawfly in Eastern Canada and New England a few years ago. It was
brought under control by a virus disease fortuitously imported from Europe
with the insect parasites intended to prey on the sawfly. The larch sawfly,
[1161
presumably of European origin, was accidentally introduced into Eastern
America some time during the last quarter of the past century. It became
epidemic in Canada in the early days of this century and raged unchecked for
years, destroying virtually every mature larch (tamarac) tree from the Prairies
to the Maritimes before it subsided, mainly because of lack of food. It is still
with us, although parasites for it have developed over the years.
Other potentially dangerous insects which attack conifers and are known
to be present in Ontario's forests include the:
Hemlock, looper — A measuring-worm type of caterpillar which attacks balsam and
hemlock.
Pine sawflies — Several species which attack pines are present in Ontario. Le-
contcs sawfly is one of these which is particularly destructive in red pine
plantations.
While pine weevil — This native insect attacks white pines by laying eggs in
notches cut in the leading or top shoot of young trees. The larvae, when
hatched, eat downwards under the bark, killing the shoot. Several shoots
may then attempt to dominate as the leader, but the weevil usually attacks
them also with the result that, instead of a properly shaped tree, a worthless
bushy shrub grows, with half a dozen or more shoots struggling to serve as
the main stem. It is one of the chief deterrents to the successful growth
of white pine over large portions of Ontario.
European pine-shoot moth — Not widely known but causes considerable damage
in Scotch pine and jack pine plantations in the southern part of the Prov-
ince. It attacks and destroys the leading shoot.
Eastern spruce bark, beetle — The bark beetle usually attacks trees which are in a
weakened or dying condition due to age or attack by other insect or fungi.
Adult beetles lay their eggs in galleries tunneled under the bark of the host
tree. The grubs which hatch from these eggs excavate individual mines
under the bark. The thousands of small mines so formed quickly kill the
already weakened tree.
Sawyer beetles — These beetles attack and seriously damage fire-killed standing
timber and logs sawn and left in the forest throughout the summer. They
are usually either black or grey and are distinguished by their long an-
tennae. The grubs which hatch from eggs deposited in notches cut in the
bark, bore long tunnels of about the same diameter as a lead pencil and a
cone-shaped pile of borings may always be found below the mouth of the
tunnel. Lumber sawn from logs affected is usually of extremely low grade,
if not cull.
Insects detrimental to deciduous trees in Ontario include:
Striped maple worm — Defoliates maples and has been particularly active on
Manitoulin Island, killing some of the stands affected.
maple leaf cutter — Defoliates maple trees, causing a loss of vigour and a decreased
sap-flow.
Tent caterpillar — This insect, familiar to almost every person, periodically de-
foliates extensive areas of poplar and attacks other trees also. Its parasites
usually regain control of it without serious mortality to the host trees.
f 1171
Bronze birch borer — Has not yet appeared in Ontario, but it is associated with
serious mortality in birch stands in New Brunswick and Eastern Quebec
and is a threat to similar stands in this Province. Whether it is a primary
cause of tree mortality or attacks stands weakened by disease, has not yet
been established but is under study.
When one speaks of insects as pests, one usually speaks of them in terms
of human relationships and forgets that often man himself is the prime mover
in calamities which befall the forests.
The best scientific evidence available indicates that many forest-insect
problems are at least intensified, if not primarily caused, by not using, or making
incomplete use of, certain tree species. Some trees are not removed by the
operator of a limit for some reason or other, perhaps because they are less profit-
able than other species or will not float, or because the terms of the lease do not
permit him to cut them. Nature's balance, established over decades and even
centuries, is thus seriously disturbed and fertile breeding grounds are provided
for the rapid multiplication of many destructive insects. It may be that the
habitat of the parasite is destroyed, while the conditions favourable for the
destructive insect are improved, in which case an epidemic is generated.
Proper silvicultural practices for maintaining a healthy forest with a fair
biological balance have been successful in preventing serious insect ravages in
European forests for more than a century, and there is every reason to hope
that similar practices here will tremendously improve future possibilities. It
will take many years of patient effort to achieve such a balance in Ontario, but
the commencement of such effort should not be postponed.
There is little doubt that severe insect epidemics occurred in many regions
before operations on any considerable scale were carried out. Silvicultural
methods in any one Province will not protect it from insect infestations originat-
ing outside that Province, although it is a notable fact that healthy forests of
proper age are rarely seriously damaged, even though attacked.
The preceding paragraph brings up the matter of the national and inter-
national nature of insect infestations and epidemics. They recognize no
boundaries, interprovincial or international, and they must therefore be treated
on the widest possible basis. This fact is recognized by all who have to deal
intimately with the subject.
The Division of Forest Insects of the Entomological Branch. Department
of Agriculture, at Ottawa, is the central body dealing with forest insects in
Canada. It co-operates closely with the Provinces in conducting a survey of
the incidence of insects of all sorts inhabiting our forests, and maintains central
laboratories at Sault Ste. Marie (built by the Province of Ontario and staffed
by the Federal Government) for intimate studies of the life history, habits and
diseases of forest insects, and special measures which may be taken to control
the various pests. The facilities of the Dominion Parasite Laboratory at Belle-
ville are also available for the breeding and storage of parasites, and services of
that nature. Laboratories to deal with local problems are maintained in British
Columbia, Ontario and the Maritime Provinces. Only Quebec Province main-
tains a Forest Entomological Service, with its own laboratories, for its local
problems. There is also close co-operation between the Quebec and Dominion
Services.
M181
The Forest Entomological Service was treated as a Cinderella until three
years ago, when the seriousness of the budworm epidemic focused attention on
its inability to cope with the problems which had arisen. Up to last year forest
entomologists, who in addition to ordinary university status must also possess
post-graduate degrees, were paid considerably less than the present earnings of
most pieceworkers on Ontario woods operations. The result was a critical
scarcity of technical personnel. Salary rates have now been adjusted so as to
be reasonably attractive, and it is to be hoped that the difficulty in obtaining
and holding technical staff has been mastered.
A national Forest Insects Control Board, with federal, provincial and in-
dustrial representation, serves as a co-ordinating agent. Giant strides are being
taken in collecting and studying data for the purpose of preventing the destruc-
tion of forests by insects.
1 recommend the closest possible integration and widest expansion
of federal and provincial effort toward the solution of forest entomo-
logical problems. It goes without saying that such co-operative effort
and exchange of information should be extended to interested organiz-
ations in the United States.
CONTROL OF PATHOLOGICAL CONDITIONS
Forest pathology deals with diseases of trees. We know little about the
reasons why a species growing on one type of soil remains sound and healthy
but on another soil develops red-heart and becomes defective comparatively
early in life. We know equally little about rates of deterioration of logs or bolts
under varying condition of storage, or other like matters.
Trees which have grown side by side since the sapling stage react differently
to changed conditions; one dies, the other thrives. These and many similar
questions are begging for solution. White pine blister-rust, a fungus disease
which must have currant or gooseberry bushes to complete its life cycle, threatens
the white pines of Eastern America. The only known method of defeating its
ravages is to remove the currant bushes, a costly and tedious process. Intensive
study should be devoted to a simpler and cheaper safeguard for this very valu-
able species.
The total number of forest pathologists in the employ of the federal and
provincial governments in Canada has never exceeded a dozen, too few to cope
with the diverse and complex problems of Canada's forests such as those men-
tioned above. I do not know of any receiving more than $300 per month, and
the general average is much below that figure, despite the attainment of Master's
and Doctor's degrees.
Like entomology, forest pathology is essentially a federal problem, but the
provinces own 90 per cent or more of the forests and the pressure for accelerated
activity in forest pathology must come from the citizens concerned. In case
the argument may be put forward that, as the provinces own the forests and
derive the revenue therefrom, the problem is essentially provincial, I point out
that federal income taxes paid by forest industries alone amount to several times
the revenues received by the provinces in the form of dues and provincial forest
taxation generally.
11191
CONTROL OF FOREST FIRES
What should be done to control forest fires in this Province was discussed
for several decades before any realistic measures were taken to meet the chal-
lenge. Early action was practically all devoted to the suppression of fires rather
than to their prevention. With the passage of years, technique and equipment
have improved, as has also the statistical data concerning areas, locations, causes
and costs of fires in effort and money. Fires over 500 acres in extent which
have been reported and mapped in recent years are shown on Map No. 9.
One tremendous advance was made just after the First World War when
the Ontario Air Service was founded. Ontario is unique amongst Canada's
provinces in the distribution of water areas sufficiently large for the accommoda-
tion of pontoon-equipped aircraft, and in the absence of high mountains. Hills
of medium height exist mainly along the north shore of Lake Superior and in
the Algonquin Park region. Conditions are, therefore, ideal for using aircraft
both for detection of fires and for moving men and supplies to fires quickly.
This is a tremendous factor in fire fighting, as minutes saved in delivering men
and equipment in the early stages of a fire can save hundreds of man-days later.
Fires starting during the afternoon can usually be controlled and extinguished
during the evening of the same day and the early morning of the next, when
more favourable humidity conditions are likely to prevail.
As mentioned earlier, Mr. E. W. Basset of the British Columbia Forest
Service accompanied the Commission staff from mid-May until late July, and
in writing this chapter I have drawn largely from his report to me. His report
is highly complimentary of the fire-protection personnel of the Department, an
opinion with which I agree.
SELECTION OF PERSONNEL
The necessity for the selection of capable junior personel is stressed,
as in the normal course of events they rise to senior positions. I am convinced
that educational standards for applicants must be set and maintained.
Appointment should be on the basis of both written and oral examina-
tions, supplemented by brief tests for mental alertness and aptitude.
Selection by such means would eliminate the employment of misfits and prevent
waste and the loss of money and timber through costly mistakes later on. The
days have passed when chances should be taken in appointing Rangers and
Deputy Rangers. Relationship to somebody already in the service, or industrial
or political pressure, should have no bearing in the selection of the guardians of
our forests. Only men best suited for the work and who have in addition a
desire to make it their vocation should receive consideration for posts which
are likely to lead to permanent employment.
As mentioned on page 97, salaries and working conditions generally must
reasonably reflect the conditions prevailing in industry or else it will be impossible
to interest the proper type of personnel. Once selected, they should be
eligible for year-round employment with the normal civil service secur-
ity, retirement benefits, etc., after an appropriate period as temporary
employees. The detrimental effect on morale, as well as the unfairness, of
maintaining employees year after year as "continuous temporaries " is evident
and the practice should be eliminated. In 1946 there were 448 continuous
temporaries, many with terms of service ranging up to a quarter century or
[ 1201
more. During the past year considerable progress has been made in ehminating
injustices of this nature, but much more remains to be done.
The new Ranger School at Dorset, many years overdue, should make pos-
sible big improvements in the training of ranger personnel, compared with the
former haphazard system of apprenticeship, where the interest taken by Chief
Rangers and Rangers in training new men, and their ability to impart knowledge,
varied widely and, in some instances, was entirely lacking. Instructors should
be selected from amongst the better administrators, but ability to in-
struct is of even higher importance than administrative ability. Train-
ing should be gradual, with frequent refresher courses to maintain
interest and to keep the ranger personnel up-to-date. It is realized, of
course, that it will not be possible to obtain immediately all the personnel who
are needed and who possess the desired standards of education, ability and
alertness; also that training methods should necessarily be sufficiently flexible
to provide for different types. A start towards the selection of the highest
type of young man available should be made forthwith.
I caution against a tendency toward making the Ranger School an adjunct
of the University, rather than of the Department of Lands and Forests. Its
prime function should be and remain the training of scalers, inspectors, cruisers,
etc., until such time as the recommendation I make concerning this matter in
Chapter XIV is adopted.
ORGANIZATION
In Chapter VII, I have indicated what I believe to be a recessary and de-
sirable change in organization and chain of responsibility, providing an Assistant
Deputy Minister in charge of each Region, with District Foresters and an Air
Service representative reporting directly to him. I consider the present align-
ment of duties between Regional and District Foresters to be insufficiently
defined, wasteful of administrative material, and unproductive of the ultimate
in co-ordinated effort.
Chief Rangers and other field staff should and must report directly to the
District Forester, who should be provided with Assistant Foresters to whom he
can delegate certain duties and one of whom can take his place when he goes
on field trips. District Foresters, like many other administrative officers, have
a tendency to become "desk-bound", particularly since the recent addition of
Fish and Wildlife Division responsibilities. This tendency must be resisted and
the District Forester should spend more than half his time in the field. I
recommend that in each District there should be at least three Assistant
District Foresters, each in charge of a branch of the District activities.
District staff in charge of accounting and of fish-and-wildlife work would not
necessarily be foresters.
The present field organization of Chief Rangers and Deputy Rangers is
satisfactory, but their numbers should be increased as outlined under the next
heading. There is at present a clash between duties relating to fire protection
and the scaling and inspectional duties of Rangers and Deputy Rangers. This
should be eliminated, as routine scaling or inspectional work must not be allowed
to interfere with the efficiency of fire protection. Similarly "duties" in con-
nection with guiding or other tourist activities, no matter how important the
guest may be, should be carried out by personnel who are not connected with
[121]
fire protection. In other words, during the fire season, fire protection
must come ahead of all other duties.
I believe it would be beneficial to the service to exchange forest protection
and forest inspection personnel between the various forest districts and ranger
districts, from time to time. It would have a broadening effect that would
ultimately prove very valuable to the service.
The proposal in Chapter VII, in which it is recommended that the Air
Service in the region should be under the Assistant Deputy Minister in charge,
will assist in welding the Forest Service and Air Service groups more closely
together.
FIRE-CONTROL PLANNING
Some compromise must be made concerning the intensity of fire-control
decided upon. It is, of course, neither feasible nor possible to prevent all fires,
but it is possible to decide what measures are likely to prevent fires burning
over more than a calculated percentage of any given area, even in a bad year.
Having decided on the percentage, control measures toward that end may be
formulated.
With such a wide range of forest types, topography and climatic con-
ditions, fire-control planning must be tailored to fit the individual Dis-
tricts. This can best be done by making the following basic surveys in
each District or Region involved.
(1) Fire-History Study
The location and intensity of risk may be determined by means of
plotting all fires and their causes over a given period, at least a decade.
Trends must be checked to ensure that some transitory and non-recur-
ring influence may not be overweighted.
(2) Fuel-Type Study
The extent and intensity of static fire-hazard should be mapped and
evaluated in conjunction with the fire-history study above, so that
tower locations and detection services generally may be planned to best
advantage. Such studies may involve abandonment or relocation of
existing towers.
(3) Access Survey
A map showing all roads, trails, boat-channels and aircraft-landing
sites should be prepared in conjunction with item (2) above, to indicate
less accessible spots where an excessive amount of time may be con-
sumed in getting personnel and equipment to a fire. Further develop-
ment may then be undertaken of those roads and trails indicated as
being necessary. This survey will also be useful in arranging strategic
location of seasonal personnel, equipment-caches, field headquarters,
etc.
More imtimate and detailed studies of visibility from individual
tower sites, locations for radio and telephone communications, tool-
caches and ranger stations, must be superimposed on the above surveys
M221
so that a proper balance of personnel and equipment, commensurate
with needs, may at all times be maintained.
Fire-control plans developed as above should not be static. They
will require constant alteration due to changes in fuel-types resulting
from forest growth, cutting or other influences, such as shifting centres
of population, changing modes of transportation, etc. For instance,
INCIDENCE OF FOREST FIRES
Forest
District
Number of Fires UNDER 500 Acres | Number of Fires 500 Acres OR MORE
Per Million Acres of Forest-land Per Decade
(White Circles Show Number of Small Fires Per Large One)
O Of • = TeN FIRES (~)0R^fc=ONE FIRE
Geraldton
O'
Kapuskasing
omm
Sioux Lookout
•o
o
Cochrane
3:8
o
Kenora
sis
O«0
Port Arthur
,H§
0(
Fort Frances
III
o<
Sault Ste Marie
o
North Bay
••••O
•••••o
o
Sudbury
>•••••
0(
Algonquin
IlilHIi
o
Tweed
^•€000000000000000
WOQQQQOQQQOOOOOQO
OOOOOOOOOOOOOOOO
O'
Parry Sound
••••••••••••••••••O
•••••••••••••••••oo
>••••••••• ••••••••oo
0(
Chart showing the comparative incidence of large and small forest fires in the Forest Districts of Ontario.
[1231
the use of helicopters may radically alter the present system of detection
and communications, eliminating many towers and telephone lines.
FIRE SUPPRESSION
Fire-suppression tactics and effort, wherever observed, were prompt and
efficient. Within their limitations, only two out of all the Chief Ranger Divisions
visited failed to function extremely well under the pressure of fire conditions
and in those instances the performance was fair, not bad.
It is difficult to make a true comparison of the efficiency of fire fighting in
the various Districts because of inherent differences in fire hazard existing be-
tween them. In the chart (p. 123) an attempt has been made to allow for these
differences by reducing the statistics to a uniform basis of a million acres in
each District for a period of ten years. Assuming equal efficiency of the per-
sonnel in the several Districts, the chart shows that proximity to settlement,
with good roads and communication systems, permits of early detection and
prompt control of fire as compared with conditions in remote Districts where
means of communication and transportation are inadequate. It will be noted,
for instance, that in the Tweed District of Southern Ontario there were 475
small fires for each fire which extended over 500 acres, while in the Sioux Lookout
District, one out of every eleven fires exceeded that area. The fact that a larger
number of people were in the woods and started far more fires in the Tweed
District was offset many times over by the increased efficiency in handling fires
in the early stages, made possible by quick detection and easy access to them
with men and equipment. This is a convincing argument for more roads in
our forests.
Spruce reproduction on an unburnt cul-over area. This illustration and the one on the opposite page are of
adjoining areas separated only by a road which served as a fire-break..
y "fi,.* -ii^T^*
"^3«*"
\
I)
•-.^^.
*%
vi»%s>-;
:> 4*
' ^, ■j/ii^^.JM
i
|8><v:
im^^rM
;
a
.A'^'
^
•'/<:
'. i
^ '{^W^^''?, >\^'^" \ ^'im'^^^P^V -^^^>^ '^'-^ tr^^
'V*%^;.'
•ife^^l."' .V''--
!/
. %
nong the most disastrous of forest fires are those in cut-over areas even though no timber is destroyed. Such
fires wipe out advance growth and so impede the reproduction of desirable species that the areas
remain commercially unproductive for generations.
There are a few weaknesses in the fire-protection system to which I would |
draw attention and which are sufficiently serious to require mention.
(1) There was no communication provided between aircraft and ground ;
crews on fires, except by direct contact, which was normally difficult to achieve <
as well as wateful of time. Some radio contact, even of the "Walkie-talkie" i
type, by which the pilot could talk to the Ranger in charge, would often j
save hours in delivery of supplies and equipment to the site. It would ^
also permit the pilot to advise the ground crew of developments in the fire- I
spread, or possibilities of attack not readily apparent from the ground. Dif- i
ferent wave lengths from those normally used may be necessary, but the possi- 1
bilities well justify serious action toward implementing the proposal. ,
(2) Suppressive action, in several areas noted, would be speeded by i
the building of access trails or roads. The use of aircraft has a tendency 1
to lull protection personnel into a sense of security which may not be justified 1
in these areas. Development of north-south highways in all the major I
watersheds would be a tremendous help in fire protection, as well as in
implementing sound forestry practice. ■
(3) The number of well trained personnel available were not sufficient to j
supervise the number of men involved on large fires. It requires one trained
man for each five to seven fire-fighters scattered through the woods, if effort is i
not to be wasted and time lost. Pre-season training schools, operated under
District personnel who have taken the Ranger School course, would
help. Every member of the District staff should have such instruction j
and it should be extended to selected individuals from the comapnies ,
25
operating in the District; it should also be made available to the general
public, particularly to those who might be called upon to assist in time
of fire.
(4) The parachuting of supplies and equipment should be studied. It
might require structural alterations to aircraft or even the adoption of other
models, but it has distinct possibilities. As soon as more practical models
of helicopters are available at prices which are not fantastic compared
with the service they can render, I recommend experimentation to de-
termine their suitability for the twin objects of detection and the de-
livery of men and supplies to the scene of a fire.
(5) The adoption of a fire-danger rating system would, I believe,
prove beneficial. There are several good systems which might be used. One
developed by the Dominion Forest Service is practicable and reliable. I believe
that adjustable signs made to resemble thermometers or barometers
would be of very material benefit in making travellers conscious of the
hazard. They would indicate the degree of the existing fire-hazard and
should be strategically placed on roads in forest areas, giving at all
times the correct information in a striking manner.
EQUIPMENT
The fire-fighting equipment of the Department of Lands and Forests was
found to be uniformly well maintained and in good repair. Tools and equip-
ment were generally suitable for the service required, though in some cases they
might be considered inadequate to meet the maximum emergency needs of the
particular area served. Some lack of balance was noted in a few cases in that
the Chief Ranger might be short of small and inexpensive equipment, while a
rather expensive type of watercraft was available for water transportation when
required. In at least one instance a fire within a couple of miles of Ranger Head-
quarters could not be reached by the forest personnel for several hours after it
had been detected, because the only water transport available (canoe and out-
board motor) could not be used in very rough water. I recommend that all
ranger stations be equipped with boats seaworthy for any weather which
may be encountered on the body of water involved.
There is a real need for central equipment warehouses where reserve pump-
ing equipment, hose, outboard motors, etc., can be serviced and stored. One
central warehouse in each of the three proposed Regions would probably suffice.
It would reduce the over-all amount of equipment needed in the Province and
would provide for quicker and better repairs in shops properly fitted and staffed
for such service. The rapid and efficient distribution of extra equipment to
areas where the emergency is greatest would also be facilitated.
The necessity for a serviceable, light-weight, pressure-type power
pump is indicated for initial action on fires. Present equipment is
good, but a pump of greater portability would prove extremely bene-
ficial in the early hours or minutes of a fire. I recommend that, if
suitable equipment is not already manufactured, the Research Division
develop a pilot model for manufacture commercially.
The usefulness of bulldozers in developing fire guards is now recognized.
I am convinced that a couple of heavy machines and one light machine
could be kept steadily in operation in each District during the summer
f 1261
months, developing fire guards, trails, etc. When a large fire develops,
they would sometimes prove invaluable in quickly clearing a guard in the path
of the fire.
Automotive equipment in practically all districts was old and generally in
poor state of repair. Departmental mechanics observed working on vehicles
had poor facilities and did not appear to be particularly well trained. I recom-
mend the study by the Department of the proposal that a well equipped
and well staffed mobile repair shop visit the Districts periodically to
overhaul their vehicles. It has possibilities of sound economy.
In some Ranger Divisions, members of the administrative staff did not own
cars and, as a result, the service suffered to some degree. It has been argued
that Departmental cars lead to abuses but it may equally well be argued that
allowances for privately owned cars on a mileage basis lead to similar abuses.
If such abuse exists or is feared, then the supplying of suitably marked light
delivery vans, instead of cars, for Chief Rangers and lower grades would seem
to eliminate the problem. For senior personnel, Departmental cars seem to be
justified and desirable. I repeat, the abuse of mileage allowances is just as
feasible as the misuse of Departmental vehicles.
INSTALLATIONS AND FOREST IMPROVEMENTS
Existing field installations at Chief and Deputy Ranger headquarters are
generally of a satisfactory type. There is, however, a need for an expanded
building programme, particularly in the east and south of the protection area.
The detail of such needs would entail an intimate study which would best be
carried out in conjunction with the recommendations in the preceding para-
graphs on fire-control planning.
Regional and District headquarters are generally poorly served in matters
of office accommodation and warehousing. Sault Ste. Marie, Geraldton, Kapus-
kasing and Pembroke are outstanding examples. From the standpoint of esprit
de corps and efficiency, as well as Provincial prestige, I recommend improved
accommodation at most of the District Headquarters.
Duplication of services is apparent between the District staffs and the Air
Service in some areas. I believe the proposed set-up will tend toward more of
the family feeling, and sentiments of envy or isolation will be dissipated.
Field telephone communications were not always adequate, or in good
repair, although they gave evidence of having been well installed initially.
In a few instances, radio installations were inadequate, due to outmoded
equipment. As an example, four lookout towers were keyed to a fifth tower,
presumably all on the same frequency. In practice, due to age, it was not
found possible to retain the sets on their exact frequency so that the key tower
had to arrange time schedules for each of the others. As a result, a fire detected
from a subsidiary tower just after its schedule, could not be reported for almost
an hour.
The existing system of fire towers is measurably inadequate and
there is a need for roughly 100 more towers in the area at present pro-
tected. These have been included in District recommendations for
several years but have not been built for budgetary reasons. If protec-
[ 1271
An open refuse burner at a saicmill. These are common in the Hearst-Cochrane area and are a menace to
the surrounding jorest and evidence of poor utilization.
tion is to be as good as it can be, they are necessary and I recommend
an expansion of the system in conformity with my remarks on fire-
control planning.
In connection with field installations, it might not be inappropriate to men-
tion that the method of budget allotments could be improved. Each District
has construction plans of varying priority. The sum allotted to a District may
not be sufficient to carry out a major scheme but it may be used for a minor
project. Therefore, if estimates must be cut, the Regional authority
should be given the greatest freedom, within his area, to utilize the
allotted funds for major projects, rather than have them dissipated on
minor developments.
FIRE PREVENTION
Some of the most effective fire-prevention effort that can be undertaken
lies in the field of public relations. I am recommending elsewhere a Division
of Publicity and Education and I foresee a widely enlarged field for it in pro-
viding lectures, motion pictures and radio programmes for schools, service clubs
and the public generally. Publicity campaigns in the daily press and periodicals
should be unremitting. I believe a fruitful public relations field might be cul-
tivated by widely publicized invitations to travellers in our forest areas to visit
lookout towers, ranger stations, air bases, etc., so that they may gain a wider
understanding and interest in the work of the protection service. Such action
1 128 1
by the Department in the case of an excellently maintained tower at Parry
Sound has been the occasion of much favourable comment and interest.
The law regarding fire prevention specifies that areas surrounding logging
camps shall be cleared of inflammable material for a radius of 300 feet and this
has been widely observed in the case of most large permanent or semi-permanent
camps. There are many notable exceptions in the case of smaller camps and
temporary camps. I have seen summer logging camps with clearing debris
within 20 feet, but with no spark arresters on smoke pipes and no fire-fighting
equipment on the premises. More specific regulations requiring a clear-
ance around all camps, spark arresters, fire-fighting equipment to be
maintained on site, etc., should be provided and fully enforced, the
penalty being the closure of the camp unless deficiencies are corrected
within 48 hours after notification.
Hazards from cutting operations must be minimized. The period
of hazard could be lessened by lopping limbs from the tops and spread-
ing the brush so that it will lie close to the ground and disintegrate
more rapidly then it does at present. Where summer cutting or other
summer operations are carried on, there should be a fire pump with at
least 2,000 feet of hose for each 50 men or fraction thereof on such opera-
tion, together with shovels, pails, mattocks, etc., all maintained in
serviceable condition. All foremen and key men of the companies
concerned should be required to take courses in the operation of such
equipment and in fire fighting generally. Such courses could be given
by District Ranger personnel prior to the fire season each year.
CLOSURE OF FORESTS IN TIME OF HAZARD
In periods of extreme hazard, at the discretion of the Regional ex-
ecutive, the forests should be closed to public travel. Such action would
be wise and, in addition, would be good propaganda in making those affected
more conscious of the importance and value of their forests. I believe such
action would be cheerfully accepted and aided by all except those few who
create the need for it.
A fire-danger rating system mentioned earlier would serve a most useful
purpose if the closure recommendation is adopted. Indicators placed along
roads could be graduated with markings and have a sign warning that if the
hazard reached a certain graduation, travel would be prohibited. Closing of
forests generally would create the need for some park areas being set aside to
which tourists and others could be diverted during the period of restricted travel.
EXTENSION OF PROTECTION AREA
On the eastern side of the Province, fire protection services generally extend
northward to the area where timber of economic value ceases. Moving west-
wards, however, there is a gap between the protected area and the economic
timber-line which widens perceptibly until, in the more westerly portion of the
Province, it extends over a distance of a couple of hundred miles.
Disastrous and repeated fires have removed the timber and much of the
soil from vast areas within this unprotected timber zone. The lack of trans-
portation systems will probably prevent utilization of much of the timber for
[1291
many years, but the area holds vast potentiaHties as an extension of the Red
Lake and Pickle Crow mining developments and many prospectors are already
actively searching for minerals there. One mine is now operating in the Berens
River district. Timber of a size suitable for mining and construction is growing
on the unburned patches, northward to the Severn River and eastwards to
include Trout Lake, Winisk and Attawapiskat Lakes. (See Map No. 7.)
When mining developments are active anywhere in this region, the available
timber will be worth many times the value of similar timber to the south of it
in regions having transportation systems. I therefore recommend the ex-
tension of the protection area northward to the economic timber-line.
This will require not less than two extra Chief Ranger establishments
with air and radio coverage. The extension northward of existing Chief
Ranger establishments to tie in with the new ones should also be pro-
vided for.
FINANCE
Forest protection costs averaged slightly over $1,000,000 per year from
1941 to I 944 inclusive. The Air Service during the same period averaged slightly
under $300,000 per annum. Both figures are based on statistics in departmental
annual reports for the period, with allowance made for receipts. Although the
Air Service does not function under the Division of Forest Protection, its exist-
ence is primarily for forest protection; its cost, therefore, should be allowed for
in any consideration of the over-all cost of the Division. With post-war in-
creases in wages and salaries and a necessary expansion in services, these costs
can only increase, and for 1945 amounted to $319,000.
Annual recipts from fire tax have averaged less than $450,000 over the
above-mentioned years, although an exceedingly high proportion of the expendi-
tures are incurred on the areas held under license, agreement, permission or
permit. It would be very difficult to get an exact breakdown of expenditures
for fire protection applicable to those parts of the Crown domain so held. It
is, however, apparent to any unbiased observer that the concentration and cost
of protection service on these areas is much greater than on the areas not under
some form of license or agreement. I estimate that upwards of two-thirds of
all expenditures for fire protection and suppression are made in connection with
the areas so held, yet the annual fire taxes on these areas bring in only roughly
one-third of the costs. I recommend that a definite breakdown of expense
on leased and unleased lands be made, and that holders of licenses,
agreements, permissions or permits, pay the full cost of the forest pro-
tection services rendered on the areas covered by their leases from the
government.
One fatal error which must be guarded against at all costs is a repetition of
that made in the depression years when, as an economy measure, the detection
and suppression staff was reduced below the minimum recommended by the
Forest Protection Service. Fires, which should have been extinguished in in-
cipient stages, got out of control and the cost of fighting them far exceeded the
savings presumed to result from the wages of personnel dismissed; in addition,
many square miles of timber were lost.
The cost of forest protection should be considered as the premium paid for
insurance, with payments provided for just as carefully as are the payments on
[1301
fire-insurance policies generally. Such premiums are not usually reduced as a
measure of economy and, if reduced, can only result in increased losses when a
fire does occur. A formula adopted by some forest protection experts is that
the total of losses caused by fires plus the cost of fire protection should be a
minimum, when averaged over a reasonable period (i.e., valuation of losses +
cost of protection = minimum). In other words, increasing expenditures on
protection are justified up to the point where they are no longer offset by reduced
losses.
It is possible that reductions in cost might be achieved and efficiency in-
creased by a closer co-ordination of government and industrial effort. I recom-
mend a serious study of the possibility of the government undertaking
all detection work and possibly the communication services, with the
companies responsible for all ground services (except possibly communi-
cations). This would fit into the scheme outlined in the last chapter
of this report and would make forest protection a function of forest
management, which it truly is. Idle or partially idle ground forces
would be largely eliminated in low-hazard seasons, and company em-
ployees could be fitted into the fire-fighting picture more readily than
at present. This latter item is important, as it was observed this season
that pieceworkers earning high wages were reluctant and unsatisfactory
workers when conscripted as fire fighters at approximately one-third
the wages they were earning as pieceworkers.
Suggestions made for the betterment of the forest protection service must
not be construed as criticism. I believe that the Province is exceedingly well
served by its protection service and that more could not reasonably be expected
for the monies expended.
As a final word of caution, I would suggest that the tendency toward over-
reliance on air service, at the expense of ground-force strength, must be carefully
weighted in considering future development and expansion. Wars cannot be
won without infantry to mop up and consolidate the gains of other arms. Few
fires can be controlled without ground forces, who are the infantry of the
forest service.
131
CHAPTER XI
Provincial Air Service
The Provincial Air Service is a separate Division from that of Forest Pro-
tection, although it might be argued that it should form a part of that Division
because its primary function is for the detection and suppression of forest fires.
The Air Service, however, provides flights for the Divisions of Timber Man-
agement and Fish and Wildlife, sometimes for the Provincial Police or the
Department of Health and, in areas where commercial air services are lacking,
it has supplied transport for industry. A number of mercy flights are under-
taken every year to carry critically ill or injured individuals to hospitals or for
surgical services.
It commenced operations in 1924 and its headquarters has always been at
Sault Ste. Marie, because the swift-flowing waters of the St. Mary's River furnish
open water for aircraft returning to base after lakes may be frozen throughout all
the northland. For the same reason, it permits the assembling and testing of
aircraft early in the spring so that they are ready to proceed to their destinations
as soon as there is open water in the northern lakes. All winter-storage and
annual repairs and overhaul work are carried out at Sault Ste. Marie.
In 1946, the service consisted of 29 aircraft, 22 of which cannot be considered
modern. The fleet is now composed as follows:
1 2 Norsemen
9 Stinsons
I Canso
5 Moths
1 Fairchild "71"
1 Buhl
Of these (20 of which are equipped with two-way radio), 27 were on fire-
fighting service, with the Canso mainly used for exploration and insect-control
experiments. The Buhl is utilized in the sulphur-fume investigation in the
Sudbury area.
The Norsemen aircraft are extremely sturdy and reliable and well adapted
to the service required of them. From the experience to date, I am convinced
that a wise choice has been made. There does, however, seem to be a field for
a cheaper aircraft with corresponding lift to provide facilities for parachuting
supplies and equipment to fire fighters. Such an aircraft has not yet appeared.
Speed is not the governing factor in fire detection and fighting. A difference
of a few miles per hour is not of great import on a large majority of the flights
undertaken.
One of the drawbacks of the Air Service is that it has, as yet, no reserve of
aircraft and when one is out of service for repairs, there is no machine available
to take its place. In such instances, coverage is normally provided, at least in
part, from air bases in adjoining Districts.
1132]
I believe that a wider use of aircraft on winter administration and inspection
of operations would be profitable and would measurably assist in bridging the
gap between staff available and staff needed. The Chief of the Division points
out, however, that aircraft so used would not be available for proper overhaul
before the summers work starts and, in addition, flying hazards are somewhat
higher in winter than in summer. An aircraft lost on winter operations would
therefore leave a corresponding blank in forest protection the following season
and it is essential that fire protection should receive priority.
I recommend, therefore, that the fleet be built up to a point which
will permit of a surplus available for proper rotation for repairs. This
would remove the present objection to winter flying which would be
beneficial, not only for timber management, but also in the control of
poaching activities.
Due largely to the nature of government accounting practices which deal
with cash transactions rather than expenses, the comparative costs of operating
the different types of aircraft have not been computed, or for that matter, the
the cost of operating any aircraft. The paying out of money for purchases of
new equipment in any year is not necessarily an expense in that year and, con-
versely, an expense such as depreciation may be incurred without paying out
any money. As a result, the accouts for any particular year are not necessarily
a reflection of the actual cost of the year's operations. This is not a critism of
the Division of Accounting, who are giving accurate reports of the expenditures
and receipts of the Air Services as required by the system of accounting in effect.
It does however, point to the need of a more comprehensive system of
cost accounting within the service.
In 22 years the service has operated ten different types of aircraft, and a
wealth of valuable data could have been made available had a cost system been
in effect similar to that used by commercial air transportation companies. How-
ever, the net expenditures for the service distributed against the various air
bases has been the type of information required and supplied.
In the past, aircraft have been completely written off in four years, although
some of the Moth machines are now sixteen years old and ten years would seem
to be a conservative period on which to base depreciation charges. Tax is paid
on all gasoline used and the Department of Highways received revenue amounting
to over $10,000 per annum from this source for 1945 and 1946, which amounted
to more than $1.25 per hour flown during the period. Commercial aviation
companies do not pay tax on gasoline used in aeroplanes.
As there are no figures available which will give the operating costs per
hour of any type of aircraft used, comparisons with similar costs for aircraft
used commercially cannot be made. However, an analysis of accounts 1944/
45/46 indicates the average stand-by cost per aircraft, including all types except
the Canso, as amounting to $53.03 per day. This includes all charges except
those for gas, oil, etc., which show annual costs increasing from $5.23 per hour
in 1944 to $6.93 per hour in 1946, due partly to an increase in the number of
heavier aircraft. Naturally, there is a wide difference between average costs
and individual costs, as the heavier Norseman, with many times the weight and
power of the Moth, uses more fuel per hour of flying time.
Reasonably accurate cost figures should be developed for the various
types of aircraft so that proper charges may be made to other Depart-
[1331
merits of the Government or to commercial firms who use the service
from time to time, and also to meet the criticism sometimes expressed
that the Department could purchase flying services more cheaply than
they can provide it themselves.
It would be erroneous to make a straight comparison of hourly charges of
commercial air services and hourly charges for the Provincial Service aircraft.
The value of having suitable aircraft, properly distributed, instantly available
and under Provincial control, is a dominating consideration which must not be
overlooked. This factor may be regarded as insurance without which our forests
would be in a more precarious state than at present. A published commercial
rate per hour for flying does not mean that there will be an aircraft available
at the right place whenever called upon for either detection or suppression
service.
A minor matter of economy would appear to require study. I noted special
flights made to deliver mail and groceries to towermen. The cost per pound of
delivering groceries in this manner seemed to be out of proportion to the services
rendered. It may be that I have failed to perceive sound reasons for the action,
which is not confined to isolated cases; but I suggest the serious consideration
of land or water delivery of mail and groceries to isolated posts. Naturally, it
is sound economy to deliver such material on regular flights and no criticism is
directed against such action.
As mentioned in Chapter X, I recommend experimentation with helicopters
as soon as their performance and cost justify such action. I believe there is a
real field for their use in delivery of men, equipment and supplies, from the
point where pontoon-equipped aircraft can deliver them, to the site of the fire.
Their possibilities in detection activity may also justify their widespread use.
At all times during the five months in which the Commission staff made
wide use of the Air Service, there was not a moment's delay because of unservice-
able aircraft. Pilots were invariably obliging and efficient and, on every flight,
reached their desired destination. This is a record of which any service might
be justly proud.
In Chapter X on Forest Protection, I warn against a possible tendency to
rely too fully on aircraft. Their field lies in detection and quick delivery of
men and supplies to the vicinity of a fire. If aircraft cannot put down in an
area, then there must be trails and other land communication systems provided
for ground forces. Such areas exist and I caution against the possibility that
they may not receive the attention they deserve because of over-reliance on
aircraft.
I have also recommended that aircraft in the various Regions suggested
should be under the control of the Assistant Deputy Minister in charge of the
Region, who would have a representative of the Air Service as a member of his
staff.
134
CHAPTER XII
Fish and Wildlife
The Division of Fish and WildHfe was transferred to the Department of
Lands and Forests only during the past year. I beHeve that the transfer was
a wise one because many phases of the work of the new Division may be co-
ordinated with the work of the Department without serious dislocation or large
additions to staff. In some areas it has thrown a considerable administrative
load on the District Foresters and has, to some extent, interfered with their field
work amongst, and personal contacts with, forest operators and owners. Clerical
staff could be added to District Offices to handle office routine, thus releasing
District Foresters and technical personnel generally to function in their proper
sphere.
Testimony given at the public hearings indicates a tremendous lack of
fundamental data concerning populations of the various species of birds, fish,
and animals and the causes of their migrations and serious epidemics amongst
them, or other reasons for the diminution in their numbers.
It is certain that many of the streams in Southern Ontario which are not
now inhabited by any type of useful fish, once teemed with game fish of various
kinds, including the land-locked salmon. Stream pollution and extreme changes
in water level have been largely responsible for this condition and, in many
cases, spawning beds have either dried up in the summer or have silted over
because of erosion, on the higher stretches of the steam, occasioned by freshets;
also the removal of timber has allowed water temperatures to rise to points
which game fish will not tolerate. A return of good fishing on our many streams
would not be the least of the blessings conferred by a wide scheme of reforesta-
tion and restocking. Not only would fish then reappear, but game birds would
return. The addition of fish and game birds would add to the recreational value
of the countryside and make a worthwhile addition to the larders of those who
have the opportunity to fish and hunt.
The reduction of forests to less than 10 per cent of the total area of Southern
Ontario has seriously affected both bird life and fish life and it is most unlikely
that there will be any considerable improvement until the area of forest is in-
creased on a vast scale. There will not be a satisfactory balance until 25 per
cent or more of the land is again under forest growth.
Big game in Ontario consists of the black bear, white-tailed deer, moose and
caribou.
Black Bear
Black bears are still abundant, even to the point of being a nuisance.
Deer
Deer are abundant in many regions and, although conflicting evidence was
presented before the Commission, the testimony of scientists who had given the
1 1351
subject most study left little cause for worry concerning the deer population.
Local scarcity was reported but this seemed to be the result of over activity on
the part of hunters in these immediate localities.
There were 55,000 deer licenses issued last season in Ontario — a tremendous
increase which may necessitate remedial action if it continues to grow. Evidence
given by a member of the Ontario Federation of Anglers and Hunters blamed
outfitters for the local disappearance of game in certain areas. His contention
was that such areas could not support forty or fifty new hunters within a small
radius every week or ten days during the open season.
Deer have proven that they can live and multiply close to or within settled
areas. Beyond the possibility that their numbers may be seriously depleted by
slaughter on a large scale by too many hunters, their future seems reasonably
well assured.
Arguments were presented for and against the passing of a "buck law",
which would for a time prevent the shooting of any deer except bucks over one
year old. The need for such action is not clear, though it would be a conserva-
tion measure of very considerable importance because many hunters would
never get a deer if they had to be close enough to it to establish beyond doubt
whether or not it had antlers. It was argued that many does would be shot
and the carcasses left concealed in the woods when the sex was established and
the legal implications realized. It was also argued that the proper biological
balance would be upset with a consequent harmful effect on the health of the
deer population.
It was argued, I believe with some justification, that deer should be killed
in reasonable numbers in order to prevent an expansion of population beyond
the capacity of supporting feeding areas. Where numbers increase beyond the
carrying capacity of any region, disease and a decrease in the average size of
animals may be expected, in addition to damage to forest growth.
The matter of suitable feed and feeding areas has not been very intimately
studied and conflicting views are held. It is rather apparent that many deer
die in yarding areas late in the season, possibly from starvation occasioned by
the disappearance of browse. What percentage of deaths occurring in this man-
ner is amongst the mature specimens, which would normally die of natural
causes, has not been established, nor has it been established whether it is lack
of initiative or lack of ability to travel through deep snow in their weakened
condition that prevents migration to other feeding areas. The summer feeding
of deer presents no problem. The destruction of winter-feeding grounds by fire
or unwise exploitation may seriously affect the situation in any locality. One
scientist gave the following testimony: "The best possible environment for deer
is provided by forests that are well utilized for wood, where slashings are com-
mon and young stands well interspersed . . . the production of a crop of white-
tailed deer in Ontario is an easy matter. The control and supervision of the
large and increasing number of hunters is the biggest problem in deer manage-
ment."
The use of hounds in hunting was condemned by one group and defended
by another, with mention by one witness of humans who imitate dogs and follow
the trails "giving tongue" in a locality where hounds are prohibited — a practice
which gives promise of the development of a new seasonal forest industry. The
evidence presented is far from conclusive. Prohibiting the use of hounds would
[1361
certainly reduce the chances of older and less mobile huntsmen shooting their
deer. I am not venturing to express an opinion concerning the cruelty to the
deer. Some compromise measure, such as hunting with a different type of dog
which would desist after a I 5- or 20-minute run, would seem to hold possibilities.
There are several abuses of the present game license procedure which could
be corrected comparatively easily, thereby diminishing the drain on deer in
some of the areas which are intensively utilized for hunting. "Dated" licenses,
expiring in a given time, would prevent the use, in more southerly localities, of
licenses purchased for the northern localities where the season opens earlier.
The widely practised custom whereby a guide shoots deer for any or all of
the members of a hunting party should be abolished forthwith. This could
quickly be accomplished by printing one section of the license in the form of
an affidavit on which the holder of the license would swear that he shot the
animal to which the affidavit must be attached. Violation should render the
signer liable for perjury and, in the case of a guide, to confiscation of his license
without right of renewal for a period of three or more years.
The above suggestion would prevent the practice of the best shot in a
hunting party shooting the deer for those not so skillful. There is really little
reason why the possession of a deer license should entitle any citizen to receive
a deer, whether or not he has the skill to shoot one himself. Under the circum-
stances this custom, which practically assures a license holder a deer, makes
venison a very cheap source of meat and, in my opinion, is one of the main
reasons for the tremendous increase in the number of licenses issued. If it
becomes necessary to reduce the deer population, they might be slaughtered
commercially and the venison sold to the public, as is the case when buffalo
herds in Western Canada are reduced. By this means, the opportunity of ob-
taining venison would be much wider than is now the case.
It was generally agreed that no shooting should be done on, or within 100
yards of, any Provincial or county highway.
The issuance of a license to an individual should obligate him to fill in a
section, which would be returned to the Department, giving the date and place
where a deer was shot and its sex, age, weight, condition, etc. Statistics of
this sort would be of great value to the scientists studying game problems.
Much waste of venison could be eliminated if a pamphlet were prepared
and distributed with each license, giving instructions on the preparation, care
and handling of a deer carcass after the kill.
Representations were made that guides' licenses have been issued to un-
suitable and untrained individuals, sometimes known to be poachers. It would
seem that an applicant should be vouched for by some official or a game associ-
ation with knowledge of the applicant's background, and unlikely to recommend
unsuitable ones. Possibly the applicant should be required to pass an oral or
written examination.
Moose
For a number of years, moose have been decreasing in numbers throughout
Eastern North America and Ontario has suffered with the other regions. The
reasons underlying the diminution in moose population are not yet understood,
but it is certain that hunting them is only one of the contributing factors and
1 1371
probably not the main one. Research as to the cause should be seriously pur-
sued and remedial measures developed at the earliest possible date if this species,
so enticing to hunters, is to hold its place in drawing tourists to Ontario. It is
not necessarily because of advancing settlements and commercial enterprises
that moose are disappearing. Experience with closely related species in Scandi-
navian countries and Finland indicate that they do not need primeval conditions
to survive.
There is no question, however, that moose are much scarcer than they
were in some of the areas in which I worked on surveys prior to 1914, and which
were visited by the Commission this year. The relative influences of shooting,
timber exploitation, disease, etc., in reducing the moose population are quite
unknown but should be exhaustively studied in order to produce a solution to
the problem.
Caribou
Caribou were once numerous westward from Lake Nipissing and northward
practically to the timber line. Their partial disappearance has been much
better understood and appreciated than in the case of moose. For winter food,
caribou depend almost entirely on reindeer lichens which, after fire, take about
50 years to develop. A glance at Map No. 9 which outlines only those fires
reported and mapped in recent years, shows how much of the caribou habitat
has been rendered unfit for their maintenance. Fortunately a good nucleus for
an increased population remains and, provided the species is given a chance,
there is every hope that improved fire-protection will permit it to regain its
place as an important game animal in this Province.
Partridge
Partridge, or grouse, of one kind or another are native to this Province.
Although at present they are experiencing one of their intermittent "low"
periods, which is of a particularly pronounced nature, they will no doubt again
furnish good sport across the Province. It should be noted that the scarcity
of these birds is just as pronounced in areas where shooting is not a factor as
as in those areas close to settlements where scarcity is generally attributed to
slaughter by sportsmen. At no point in the timbered portion of the Province
did the Commission find any indication of an abundance of partridge.
Pheasants
Pheasants have been introduced in several areas and have proved that with
winter feeding they can survive. They do not seem to be able to maintain their
numbers without artificial aids and whether their propagation should be en-
couraged by the Division of Fish and Wildlife or whether this should be left
to private groups is a matter for debate. My personsl impression is that studies
toward finding and removing the cause of "low" periods in the native game-bird
population offer wider possibilities in the provision of sport and recreation as
well as of food.
Wild Ducks and Wild Geese
Wild ducks are native to most of the lakes in Northern Ontario and wild
geese use the northern Barren Lands as a nesting ground. Duck hunting is one
of the most widely practised sports and, during the open season, extends over
1 1381
practically all the lakes and marshes in the southern portions of the Province.
Although statements are sometimes noted in the press expressing alarni about
the future of wild ducks, no evidence was offered to the Commission indicating
any concern on this score.
Wild geese are more difficult and more expensive to reach. Unless one can
afford to go north and shoot them before they migrate, the opportunities of
shooting them are not extensive.
Fish
In areas where hydro developments or any dams for stream-control have
raised water to such an extent that spawning conditions have been seriously
altered, the fish population seems to have suffered rather severely. Silting and
water discoloration have resulted in Lake Nipigon due to the Ogoki Diversion
and in the Seine River area due to the Steep Rock development, and I am
alarmed about the effect this will have on the fish. It is possible, however, that
economic considerations will overshadow the harm done to the fish.
Ontario is studded with beautiful lakes, practically all of which might be
developed into outstanding recreational assets. A broad programme of road
development to open up all major watersheds and which would make these
lakes accessible and thereby relieve the drain on lakes closer to population
centres, coupled with a programme of improved fishing conditions, promises
sound economic possibilities. It is a well established fact that, within reason-
able limits, science can assure a crop in pounds of fish per acre of lake in much
the same manner that it can assure a crop in bushels per acre of farm, or cubic
feet of wood per acre of forest. It is possible that we have pursued just as
thoughtless a course of exploitation of our fish resources as we have of our forest
resources; but the restoration of our fish resources will require a much shorter
time, except in those streams and lakes which require reforestation to return
them to their original, natural condition. It should be initiated on a soundly
planned basis, starting in the localities closest to roads and railways.
I recommend:
(1) "Dated" licenses, possibly of different colours, identified with
areas which have different periods of open season for the same
species.
(2) The rigid enforcement of a regulation that one license permits
the shooting of only one deer or moose.
(3) The enforcement of a regulation that guides or others may
shoot only one deer and that each license will carry one detach-
able affidavit form which must be signed by the holder, testify-
ing that he personally shot the animal to which it must be
attached.
(4) That provisions be made on licenses for a "written" statement
of game taken, including the locality and other pertinent in-
formation.
(5) Research as to the causes of the gradual disappearance of moose;
the effect of stream pollution on fish; water levels and flow; the
feeding habits of deer and moose; the variations in bird popu-
lations and the reasons therefor; the effect of birds in controlling
M391
forest insects, etc. There are dozens of similar problems re-
quiring solution.
(6) The establishment of temporary game sanctuaries. When
game becomes scarce in any locality, it might well be declared
a sanctuary for a period of five or ten years, then opened to
hunting again.
(7) The setting aside of a couple of townships devoted exclusively
to the more primitive method of hunting with bows and arrows,
etc. It would appear that this form of sport calls for the maxi-
mum of hunting skill, without causing as serious a depletion
of game as firearms. It is definitely possible to kill deer with
arrows, and it would seem of little consequence to the deer
whether the missile was discharged from a bow or a rifle.
(8) The development of better fishing conditions for game fish in
our more widely advertised areas. While working in the neigh-
bourhood of Lake Nipigon last summer, I met no tourists who
had taken a satisfactory catch of fish; but I did meet several
who were irate because they had come a long way to fish in the
widely advertised Nipigon waters, and returned empty handed
except for a few pike. It is possible that other regions may
impress outside fishermen in a similar manner. A few such
disgruntled tourists describing their experiences may seriously
endanger a growing industry.
(9) That the Division of Fish and Wildlife attempt to establish
the needs, if any, for a proper biological balance of porcupines
and that, in the meantime, huntsmen and others declare a
relentless war on these forest destroyers. Although porcupines
are not game animals, they are often encountered by huntsmen
and opportunities for their destruction are many. One widely
experienced forest engineer has told me of killing twenty-two
porcupines during a season in one camp. This represents
merely the surplus population on probably a very few acres of
one of their favourite habitats.
I again emphasize the fact that little is known of fish or game populations
or the migrations, feeding habits or diseases of game. Scientists who know
most about the subject were the least sure of their information or the solu-
tions to the various problems, while those who had little or no authentic
data were ready with all the answers for their own localities.
In the past, the policing aspects of the work of the Game and Fisheries
Department have been accentuated, but it is gratifying to note that since the
transfer of these activities to the Department of Lands and Forests, a scientific
approach has been inaugurated toward the study of fundamental problems.
This policy should be carried on with increasing vigor.
A relentless war should be continued on poachers and the buyers of their
illicit catch of furs, with heavy fines and the cancellation for life, or for at least
five years, of the licenses of these latter human pests. To this should be added
a refusal to issue, during the period of cancellation, a license to any member of
the immediate family of a buyer so convicted without a full investigation of the
applicant. From information received from many sources concerning illegal
dealings in furs, it is evident that the trail of corruption pursued by this class
of criminal has been altogether too long and that the penalty for following it
should be increased drastically.
[1401
CHAPTER XIII
Research
Probably the most notable impediment to the proper consideration of
almost any phase of forestry in Ontario is the lack of fundamental data con-
cerning it. No matter what avenue one now attempts to explore, it sooner or
later develops that positive conclusions are impossible because of the lack of
scientific and precise data.
Enumerated below is a partial list of the subjects on which precise data is
required but is not available on any scale comparable with needs:
(A) Definite knowledge lacking and urgently needed on —
(1) Rates of growth in stands of varying ages and compositions on dif-
ferent sites.
(2) Reproduction following various cutting-methods on different sites and
in different types.
(3) Effect on future forests of various methods of slash-disposal under
different forest-types and cutting-methods.
(4) Effect of fires on cut-over areas.
(5) Effect of different cutting-methods on biological life in the forests.
(6) Losses from insects and diseases, and their long-term effect on forests.
(7) Comparative costs of different systems of silvicultural treatment.
(8) Sinkage losses on drives and how to minimize them.
(9) Causes of decay and disease in standing timber.
(10) Species best suited to planting on heavy soils and swamp areas and
the methods to be followed.
(11) Species and methods to be used for planting on limestone plains.
(12) Development of lighter and more efficient forest-fire pumps.
(13) Forecasts of fire hazard.
(14) Fish and game populations and their migrations under various con-
ditions.
(B) Pressing needs in utilization research concerning —
(1) The possibilities and economics of developing products of higher cate-
gory than is now the practice.
(2) The possibility of development of more efficient basic manufacturing
methods. Present methods, particularly in sawmilling, are to a large
extent due to tradition.
(3) Utilization of waste products of forest industries.
(4) Development of new products and new uses for present products.
(5) Processes enabling the utilization of a higher percentage of the raw
materials as primary products, both in the woods and in the mills.
[141]
(6) Methods for the more efficient handling, packing and transporting of
low-value products of sawmills.
The handicap under which the Research Division has functioned is well
recognized and the development of its activities, as personnel has become avail-
able, is a source of gratification. I wish, however, to emphasize the vast need
for expansion in all lines of research activity and for the compilation of informa-
tion in a readily usable form. Until unbiased and authentic data are available,
our forest activities can only be carried on using rule-of-thumb methods and
theories which are often far from sound. Research must assume an increasingly
important role in all forest enterprises if they are to develop along sensible lines.
DOMINION GOVERNMENT RESEARCH FACILITIES AVAILABLE
The Dominion Forest Service has branches dealing with forest economics,
silvicultural research which includes growth and regeneration studies, forest
protection, forest survey and aerial mapping methods. It maintains two well
equipped forest products laboratories and five experimental stations in various
parts of the Dominion, and co-operates in the activities of the Pulp and Paper
Research Institute. It could and should serve as the agency for assembling and
co-ordmating the work of the various provinces with its own. Every effort
should be made to standardize methods of collecting and recording data so that
results may be comparable with those in other provinces and will fit into the
national picture. The benefits from such co-operation are many and without
it the value of data obtained is considerably reduced.
FOREST EXPERIMENTAL AREAS
I recommend that the Province give serious consideration to the
development of at least four experimental areas which should be estab-
lished in locations typifying the growth and operating conditions over
wide regions. The Petawawa watershed, or a considerable portion of it,
would be suitable for one of these stations. I would suggest another
in the Clay Belt, one in the Algoma district and one in the Lakehead
region. These experimental areas should each extend over one or more
minor watersheds and should be large enough to allow full-scale camp
operations on a sustained-yield basis. All species should be cut and
diverted to their proper economic uses. Different cutting and regener-
ation methods should be tried and comparative costs and results ob-
tained and tabulated. A medium-size sawmill should be an integral
part of each experimental unit. This would be necessary in order to
permit of a properly developed, multiple-use operation and, in addition,
the sawmills would be an indispensible need in conducting research
work in connection with the lumber industry. Some research projects
of this kind have been mentioned above.
I visualize these operations as training grounds for scalers, forest rangers,
sawyers, clerks and all the junior grades of forest administrative staff. They
would furnish pools of highly trained fire-protection personnel, strategically
placed within three hours flying time of almost any fire in the area at present
protected. A couple of trips with the Canso plane would furnish any large fire
with a group of trained fire-fighters, each one of whom would be worth at least
four of the type normally picked up from the local unemployed personnel in
the district.
[1421
Any products resulting from the operations in these experimental areas could
be sold in the open market and, if a loss is incurred, it might be charged to edu-
cation and research. They might easily prove to be self-sustaining or better.
In any event, they would provide proving grounds for methods and theories
which could take much of the guesswork out of logging and silvicultural prac-
tices, and I can well imagine that many of the personnel trained on them might
be enticed into industry. This would be a satisfactory means of extending
sound practices learned on the forest experimental areas to the firms employing
personnel so trained. I also foresee a mutually useful association between these
research units and the Foresty School of the University of Toronto. The former
would provide opportunities for both study and employment, the latter would
act as a source of counsel and of trained and semi-trained technical assistants.
The areas could be utilized as the location of sample plots for many types
of study, both in virgin forest and in cut-over areas and, I believe, could serve
the forest industries even more fully than experimental farms serve agriculture.
143
CHAPTER XIV
Education and Publicity
In Chapter VII, I have recommended a new Division to be known as that
of Education and PubHcity. Wide personal contacts with all classes in the
Province, and representations made at the public hearings of the Royal Com-
mission, have convinced me of the need of broadened effort along these lines.
The vast majority of the public know little about their ownership of the forests,
their responsibilities and their potential control over forest operations and
maintenance. They do not know of the legislation already in effect or of its
impact on the forests. Many citizens at our public hearings advocated action
which had already been taken toward the solution of the very problems they
discussed.
If we are to overcome the inertia which has prevented sound forest policy
for many decades, we must for a time concentrate public thinking on existing
conditions and the methods by which they may be improved. The consequences
of making these improvements and the alternative of leaving things as they are,
should be clearly focused in the public mind.
To carry out a programme of the scope required to meet the needs of forestry,
use must be made of every vehicle available to spread informative and factual
information pertaining to the serious aspects of the provincial foresty situation.
This will include talks and lectures at educational institutions, at service clubs,
to members of trade associations and to the public generally. It will require
the constant publication of suitable articles in the daily and weekly press and
periodicals. Moving pictures, widely distributed to schools, and forums with
radio addresses by prominent and nationally known citizens, should all play an
important part in forestry propaganda for the next decade or more.
Training requirements call for several schools for instructing scalers, rangers,
timber cruisers and clerical personnel for government service; and sawyers, fore-
men, cruisers, fire fighters, clerical personnel and cooks for industry. These
could well be integrated with the forest experimental areas advocated in Chapter
XIII. The full time of the school under construction at Dorset may be taken
up in training engineering students from the School of Applied Science, under-
graduates from the Faculty of Forestry and the staff of the Division of Fish
and Wildlife, and with refresher courses for forest-protection and scaling per-
sonnel. I foresee needs much beyond the capacity of this school for several
years ahead, as it must be realized that requirements far exceed the supply of
trained employees in all the above-mentioned groups.
The need of a standard method of selection of candidates to be trained as
scalers, rangers, clerks, etc., is stressed in Chapter X on Forest Protection and
I again draw attention to it here.
The educational effort in forestry subjects in primary and secondary schools
should be much more heavily stressed. It seems too much to hope that many
extra classes in forestry matters can be added to the present curricula of lower
schools. It should be possible, however, to instruct future teachers in the
M441
fundamentals of the subject during their term at Normal Schools and to give
similar training by means of Summer Schools to those who hold certificates as
teachers.
Instead of adding to public or secondary school curricula it should be pos-
sible, through a revision of text books, to include much sound forestry in the
ordinary classes. Problems in arithmetic might be related to the growing or
harvesting of forests. History and geography might well contain much that
would be interesting and instructive to pupils concerning the devastation of
forests and the effect on the nations concerned. For instance, in parts of Syria,
which were once well forested and maintained a populous and wealthy civiliza-
tion with large cities, the people devastated their forests and these parts are
now virtually an uninhabited desert, with the old stone roads, built twenty or
more centuries ago, standing several feet above the general level of the eroded
countryside. The shores of North Africa were once well wooded and gave birth
to huge cities like Carthage. With their forests gone, instead of remaining the
granary of the Mediterranean, they became the deserts that Wavell and Rommel
fought over a few years ago.
Bruce and Grey Counties were amongst the most prosperous in Ontario 50
or 60 years ago. To-day their population has shrunk by 40 per cent, with
roughly one farm in every ten abandoned. Unless remedial measures are taken
on a large scale, they are most likely doomed to further losses. Other areas in
the Province are degenerating in the same way.
On the other hand, there are forests in Europe which have been cropped
for hundreds of years with no sign of deterioration. In Sweden, the whole
economy of the country is based on forestry and, in competition with the world,
they have maintained their forests and a standard of living and happiness com-
parable with any to be found elsewhere.
These and many similar examples could be woven into the fabric of our
school training and, coupled with school forest-plantations, within a quarter of
a century there will have been produced a class of citizens jealous of our forest
heritage and its place in our national life.
I consider the needs too urgent to be relegated to a branch within a Division
of the Department and I would fear lack of sufficient stress to overcome past
neglect if the handling of publicity were left to the less vitally interested direction
of a general publicity bureau of the Government. It constitutes a full-time
occupation for experts and enthusiasts, if the necessary aims are to be achieved.
I therefore recommend that the work be carried out by a new Division
of the Department.
145
CHAPTER XV
Export of Pulpwood
During the public hearings of the Commission, the question of the export
of unprocessed pulpwood from Crown lands came under criticism more often
than any other aspect of forest exploitation in this Province. The attack was
exceedingly bitter from some directions, but some of the exporters made a
vigorous defence. Probably the most telling blow administered was by a former
exporter who characterized as "economic suicide" the recent widespread practice
of cutting wood by prisoners-of-war, and shipping it out of Canada for manu-
facture.
Map No. 5 shows the percentages of the total quantity of export pulpwood
originated in the various Forest Districts of the Province.
As outlined in Chapter I the matter of export of unprocessed wood has been
a contentious subject for a long period. During the 19th century arguments
first arose over the export of tanbark and later concerning sawlogs. The export
of pulpwood from Crown lands is of much more recent origin.
Some companies purchased freehold lands many years ago and for twenty
years or more have been exporting pulpwood purchased from settlers, in addition
to that cut on their own freehold land. As it turned out, the purchase of pulp-
wood from settlers for exportation had much the same effect as if it had been
taken from Crown lands. Most of the wood so obtained came from pseudo-
settlers who, after being located for free grants on well wooded lots, abandoned
them after clearing off the pulpwood and selling it to domestic mills or to ex-
porters. The pseudo-settlers then took up new lots and repeated the process
as often as it became necessary to do so. Hundreds of thousands of acres of
lands capable of growing splendid forests, but marginal or sub-marginal as
farmlands, have been devastated in this manner. The Lakehead area and the
Clay Belt along the Canadian National Railway west of Cochrane bore the
trunt of this onslaught, and thousands of lots have been abandoned in these
areas.
The acreage of forest land thus denuded in the past quarter century is
shown in the diagram below.
ig
LOCATIONS S SALES
CANCELLATIONS
•acres
-^ S5 1?, i§
i»A}^,. 1 '- ' s K S '•♦
'ik
mm'?^^'. -^-jjf! , ,
\^^r^mi:^Z^;^^M
PATENTS ISSUED
Diagram indicating the comparatively small part of the acreage devoted to colonization which was
genuinely settled as contrasted with the much larger area stripped of timber and returned to the Crown.
11 461
Few real settlers remain on the land so alienated and of those who have
remained in the Clay Belt, many continue to be aided by supplementary annual
permits to cut 50-250 cords per family on other lots in their vicinity.
About 15 years ago it became apparent that the quantity of pulpwood
produced, on lands set aside for colonization within economic hauling distance
of the railways (seven or eight miles on either side), could not be further in-
creased and, in fact, would soon have to be drastically reduced by reason of
denudation. New sources were necessary if the dealers involved in the trade
were to supply their customers, both domestic and foreign.
At that time Ontario, with the rest of Canada, was suffering from unem-
ployment and it is not difficult to appreciate the temptation which the promise
of gainful employment for woods labour presented to the administration of the
day. They succumbed to the temptation and there can be little, if any, blame
attached to them, even though it meant the reversal of a policy which had
become almost a religion with previous administrations in this Province, and is
still the inflexible policy of the Province of Quebec, namely, the retention for
domestic (Canadian) use of all wood cut on Crown lands.
The story is well told in the evidence of the Minister of Lands and Forests
before the Select Committee of the Legislature in 1940. He testified that the
change in policy was required:
(a) as an employment scheme, and
(b) as a salvage measure to remove overmature timber.
Whatever may have been the situation when the policy of export was first in-
augurated, neither reason is now soundly based. The giving of employment in
the woods to a few hundred men in order to export pulpwood merely makes it
possible for mills to continue in operation in another country instead of being
established in Canada and giving employment here. However, as a short-term
expedient in a period of unemployment, the practice cannot be condemned.
The latter reason, however, does not apply to-day at all. The field work of the
Commission did not reveal any exporter working in overmature timber. Many
spruce stands which were being cut were in age-classes between 100-135 years,
but there is little sign of deterioration in such stands until after 175 years.
The Minister cited the quantities produced in and exported from the Thunder
Bay region in 1937, as follows:
Cords Cords
Permissible cut of spruce and balsam 742,000
Spruce and balsam used by domestic mills 425,715
Spruce and balsam exported from Crown lands. 218,067
Net excess over exports and consumption 98,218
742,000 742,000
He expressed satisfaction with the situation and argued that a further 100,000
cords could have been exported without detriment to the local situation.
Most of the earlier export agreements contained provisions requiring the
building of mills in Ontario, but in no single instance did any of the signers fulfill
their obligations in this respect with the result that the agreements were subse-
quently cancelled. In some cases, re-negotiations of agreements have more
specific obligations concerning the building of mills.
1 1471
The export of unprocessed wood has however progressively expanded till,
in 1946, the total permissible cut for export amounted to roughly 890,000 cords
from Crown lands, with an additional 50,000 cords from the Algoma Eastern
Railway lands exportation from which is subject to government control and
export levy.
The transfer of cutting for export from so-called private lands to Crown lands
is graphically portrayed in the following table based on information supplied by
the Department of Lands and Forests.
PULPWOOD EXPORTED FROM ONTARIO
Year
Cords cut from
Total
Adjusted
Crown Lands
Other Lands
Totals*
1928
1929 . . .
840
4.872
191
860
35.407
26.240
84.042
45.413
118.633
611.984
423.579
496.343
402.587
109.362
190.566
196,115
220.741
221.698
612,824
428.451
496,534
403.447
144.769
216.806
280.157
266. 1 54
340.331
1930
1931
1932
1933
1934
1935
1936
937
938
939
940.
941
942.
943
944.
945.
218.067
324.844
258.654
362.481
404.328
482.597
408.504
250.220
395.441
3.421,634
283.496
288.212
174.506
188.346
230.970
254.450
174.491
134.358
153,914
501.563
613.056
433.160
550.827
635.298
737.047
582.995
384.578
549,355
4,755,718
8,177,352
689,300
790,000
621,000
401,000
568,000
*Totals after 12^9 P^r cent, adjustment for conversion of cords of peeled wood to cords of un-
barked wood.
During the season 1945-46, 2,424,419 cords of spruce, balsam and jack pine
pulpwood were cut on Crown lands under lease and of this amount the Depart-
ment of Lands and Forests approved the export of 843,931 cords. In addition
to the above amounts, 29,434 cords of poplar pulpwood were cut on leased Crown
lands and 81 ,200 cords of all kinds of pulpwood were cut under permit on Crown
lands not under lease. A portion of these two latter amounts was cut for export,
but the Department will not know how much until applications for permission
to export are received. Of this quantity, some would be shipped to domestic
mills and compensating adjustments made. How much actually left the Prov-
ince cannot readily be ascertained. There are three sets of figures: those of
the Department of Lands and Forests, those of Canadian Timber Control and
those of the Dominion Bureau of Statistics.
Comparison of these figures necessitates adjustments for different conversion
factors between cords of peeled wood and cords of unbarked wood. The Depart-
ment ignores this difference. Timber Control adds 1 7 or 14.3 per cent to the
figures of peeled wood and the Dominion Bureau of Statistics adds 1/8 or 121/2
per cent to peeled cords. In order to get a reasonable comparison between the
148
three sets of returns, all quantities of peeled wood reported have been adjusted
on the 12y2 per cent ratio.
On the above basis the following comparative figures emerge:
REPORTS OF EXPORT OF PULPWOOD FROM ONTARIO
1943
1944
1945
1946
Ontario Department of Lands and Forests
Canadian Timber Control
Cords
621.000
660.000
668,000
Cords
401.000
477.000
547.000
Cords
568.000
590,000
655,000
Cords
794.000
830 000
Dominion Bureau of Statistics
(Figures
not yet
available)
In compiling its export figures, the Department relies on clearances given
to exporters by District Foresters, and has an arrangement with the Customs
Division of the Federal Department of Revenue to hold up at border points
shipments not covered by clearance papers. It seems possible that this latter
arrangement could be defeated. The final Timber Control figures are compiled
from returns made by the importers who receive the wood, checked against
tentative figures supplied by the exporters when applications for permits to
ship are forwarded to the Federal Department of Trade and Commerce. Dom-
inion Bureau of Statistics figures are based on clearances through the Customs
Ports at Ontario border points. Because a good deal of wood from other Prov-
inces leaves the country at points in Ontario and because a certain amount of
Ontario wood is exported through Customs Ports in Quebec, some adjustment
has had to be made in the Bureau of Statistics official totals to arrive at a fair
estimate of the quantity of Ontario wood leaving the country. It is impossible
to arrive at a precise answer because no record is kept of the points of origin of
the pulpwood exported, but by inquiry this Commission has arrived at what it
believes to be a reasonable adjustment. It is physically impossible for customs
officers to measure individual shipments but the shipments are checked against
the exporters' estimates of the quantities loaded. It will be noted that, with
1944 an exception, there is essential agreement between Timber Control and
Dominion Bureau of Statistics figures. Preliminary Dominion Bureau of Sta-
tistics figures for 1946 indicate that similar agreement will apply.
INCREASED INVENTORIES OF WOOD CUT FOR EXPORT
Figures relating to shipments of pulpwood apply to calendar years. At
the 1st of January each year, Ontario exporters report to the Canadian Timber
Control the quantity of exportable pulpwood cut but not exported at that date.
This carry-over was reported as 392,000 cords as of January 1, 1944. The
corresponding figure for 1946 was 995.000 cords, with preliminary but not com-
plete figures for January I, 1947, showing a similar amount. This indicates an
increase in inventory in Ontario of slightly over 600,000 cords or, in other words,
the cutting by exporters since 1943 of that much more wood than they have
exported. No doubt some portion of this wood has gone to domestic mills, but
it would amount to less than one-third of the above quantity.
The figures quoted, I believe, emphasize the necessity for a close and more
comprehensive control by the Government over shipments of wood. There are
many weakesses in the system which permit of overshipments, or result in the
[ 1491
confusion of accounts between wood cut on Crown lands and private lands.
There are certainly signs of confusion shown by the figures in the above tabu-
lations.
The interlocking characteristics of some of the exporting companies and
individuals make it difficult to trace the destination of some of the wood without
an intimate study of the records of the various operators concerned. (One
dominant individual is identified with five exporting organizations.) I decided
that detailed investigation into this subject was not justified as it would, of
necessity, cause considerable delay in the presentation of my report and the
general trend in relation to pulpwood exports is sufficiently clear without allotting
the exact share of the trade to each participant.
EXPORT AGREEMENTS
Since 1937 many export agreements have been negotiated, with keen bar-
gaining apparent in practically all of them. In my opinion, the welfare of the
Province has not always been adequately safeguarded. In many of the earlier
agreements which provided for the establishment of Ontario mills, the size of
the mill specified and its description indicates that it was merely a pawn in the
game of obtaining limits carrying export privileges. In instances involving large
areas of timberland, a 100-ton pulp mill would be specified, but no mention
would be made as to whether it was for the manufacture of groundwood pulp
or of chemical pulp, though the latter type of pulp requires almost double the
quantity of wood.
The trend of pulpwood agreements generally has been toward increased
export shipments of unprocessed wood, without comparable increases in domestic
production of pulp or paper. In one instance the largest shareholder of a com-
pany having an export agreement purchased the shares of the other corporations
involved which in turn were given new export privileges; the result is that the
total quantity of pulpwood which may now be exported, from the total area
now involved as a result of the deal, is almost double the original quantity.
At the present rate of cutting, few of the exporters have sufficient limits to
provide for operations on anything approaching a sustained yield basis. The
maximum annual cuts provided for in most of the agreements grossly exceed
the possible annual growth on the areas involved under the cutting methods
used or likely to become feasible in the near future.
Annual cuts permitted by export agreements vary from slightly under one
quarter of a cord per acre per year to over a cord per acre per year. The average
for the group is well above that permitted on Sweden's managed forest lands,
which is just under one-third of a cord per acre per year, where sound silvicul-
tural practices are the rule. Practically all agreements, however, have a saving
clause which obligates the operator to practice "good forestry ". Except under
unusual circumstances, "good forestry" precludes cutting in excess of the annual
replacement. While the "good forestry" clause has not been observed to date,
it should be invoked at least to the extent of keeping the annual cut commensur-
ate with the annual replacement under the silvicultural system practiced.
One export agreement permits the shipment to the United States of one
cord of wood for each cord used in the domestic mill built under the agreement.
It also contains a clause which obligates the company, at the direction of the
Minister, to cut into sawlogs, poles, etc., material suitable for that purpose. I
M501
am convinced that only by avoiding expansion in domestic production, and
therefore in exports, can the timberlands concerned continue to furnish wood in
perpetuity for all three purposes. Several clauses in this agreement are indica-
tive of very keen bargaining to guarantee a specified quantity of wood for export
before any effort is directed toward the provision of wood for domestic mills.
I wish to draw attention to a clause in one export agreement which provides
for the export of a maximum of 25,000 cords of spruce and balsam annually until
1962, "notwithstanding the provisions of any Act or Regulations from time to
time in force respecting the exportation of pulpwood." This clause attempts
to place a private contract in a superior position to the laws of the Province
and, while it is probably worthless, it might be very misleading to security
holders and possibly to junior officials in the district.
I recommend a review of all export and domestic agreements, with
a view to the adjustment of permissible annual cuts to correspond with
the probable annual growth on the areas involved. Until such time as
annual growth has been definitely established, beyond shadow of doubt,
by proper growth studies approved by the Department, it should be
calculated at a rate not exceeding 10 cubic feet of conifer timber per
acre per year over the superficial area of the limits involved.
It should be realized that export agreements now extend over more than
ten thousand square miles of some of the best remaining timber stands for the
production of sawlogs, ties and poles. Other export areas also contain materials
suitable for these uses, but not to such a marked degree.
NEWSPRINT CLAUSE IN EXPORT AGREEMENTS
Much weight has been attached to the clause inserted in all export agree-
ments prohibiting exported pulpwood from being utilized in the manufacture
of newsprint. In my opinion, this clause is of little effect in that pulpwood
exported from Ontario goes into the United States pulpwood pool and relieves
that pool of some of the competition between newsprint manufacturers and
others. It matters little which cord goes to the newsprint mills, one from
Ontario or one from the United States or any other source made available by
the shipment of a cord from Ontario. As mentioned earlier in this report, paper
made in United States mills competes on the home market with that made in
Canada.
EFFECT OF EXPORT OPERATIONS ON THE WOODS WAGE
STRUCTURE
Another feature, which may not have occurred to the general public, is the
woods-labour situation created by the expanded export trade in pulpwood in
the past five years. Some exporters permitted their woods operators to outbid
domestic companies for labour during the later war years and the post-war years.
This had a very unsettling effect and frustrated the best efforts of the domestic
mills who were endeavouring to maintain controlled wage ceilings. Overbidding
for labour is admitted, and even glorified, in a brief presented before the Com-
mission by one of the larger exporters. I quote from this brief: "I managed,
through the Legion, to interest 35 men all quite young, from 20 years of age
and up. They were all without previous experience. Some of them were quite
frail. As an independent (italics by the Commissioner) I was able to take these
men and to guarantee them not only a decent living wage, but a very generous
[151]
wage if they would only try the job. We started them off with a flat guarantee
for the first month, a salary much higher than any of them had received previ-
ously. They all tackled the job in great style and learned very quickly. We
made the top wages retroactive from the commencement of the work, then
placed them on a piecework basis, which netted them between $12.00 to $14.00
per day clear, and at the end of the year they received a bonus of $16,000 for
the group."
The effect of such action must be most upsetting to skilled mechanics and
professional men who spend years in gaining skill, only to find themselves earning
much less than relatively untrained pulpwood loaders. Such action has been
gravely damaging to the morale of woods labour and has created an almost
intolerable situation for the operator who must control his cost structure in
order to remain in business.
In my opinion, one of the main reasons why exporters have been able to
permit such tactics is the financial condition of their companies as compared to
that of Ontario companies. Funded debt and other financial obligations of the
former have been liquidated over many years of operation and their financial
burden per ton of production is therefore much lighter than that of the newer
Canadian mills. This is clearly indicated in the table below.
CAPITAL AND CURRENT LIABILITIES OF THE PULP AND PAPER INDUSTRY
OF CANADA AND THE NORTHERN UNITED STATES IN 1945*
(By percentage for regional groups of representative firms)
Regional Group
Northeastern States^
Lake States (firms with no
Canadian plants)
Lake States^'firms operating
plants in Canada)
Ontario^
Quebec, New Brunswick
and Nova Scotia^
Number
of firms
in Group
Bonds, loans,
deferred bond
interest, etc.
Preferred
Stock
Common
Stock and
Surpluses
Current
Liabilities
14
12.0%
10.0%
68.3%
9.7%
20
14.3%
11.0%
62.6 %
12.1%
4
10
20.0%
37.4%
9.6%
29.3%
60.4%
25.7%
10.0%
7.6%
7
; 50.9%
i
4.2%
36.3%
8.6%
*CompiIed from "Moody's Manual of Investment, 1946."
^Including several firms with extensive freehold or leased timberlands in Eastern Canada.
^Including some firms also operating in other provinces and two firms whose most recent pub-
lished financial statements were for 1944.
^Including one paper company and six of the largest pulp and paper companies, the latest financial
statements for two of which were for 1944.
It is natural for domestic pulp and paper mills to feel that some of the
differential indicated has been utilized in outbidding them in the woods-labour
market.
EFFECT ON LUMBER INDUSTRY
Labour rates on pulpwood operations are inevitably reflected in the cost of
sawmill operations. The effect of rising woods-labour rates, combined with con-
trolled domestic prices, is disturbing. Sawmill operators were compelled to sell
half to two-thirds of their lumber at closely controlled prices on the local market.
In order to remain in business, the lumber industry claims it has had to obtain
export prices sufficiently high to compensate for the lower prices on domestic
52
sales. What may be the long-term result of this policy of making export sales
pay for domestic losses is a problem which will have to be faced when the present
boom market for lumber has passed and Great Britain, Canada's traditional
market for lumber, will have Russian and Scandinavian supplies available in
abundance. Goodwill sacrificed is difficult to regain.
I am not advocating low woods-labour rates and will treat with that subject
in a later chapter. There must, however, be some stability and some control
of such rates, otherwise both industry and labour will eventually suffer.
EXPORT FROM CROWN LANDS NOT UNDER EXPORT
AGREEMENTS
In addition to pulpwood exported under agreements which have been made
public, there have been smaller but substantial amounts cut on concessions or
on lands under license which, according to the original contracts with the Crown,
carried no export rights whatever but on which permission to export has since
been granted on a year to year basis.
In the case of one company, in spite of the fact that their contract speci-
fically states otherwise, export of substantial amounts of jack pine is permitted,
although this same company has closed its two sawmills which formerly contri-
buted large quantities of lumber, ties, etc., to the provincial output.
There are sixteen other limit-holders who have export permits and they
have cut over 80,000 cords during the past season. It is not feasible to ascertain
exactly how much of this material has been exported.
BENEFITS CREATED BY EXPORT OF PULPWOOD
The preceding paragraphs have recited many, if not most of the drawbacks
inherent in present export agreements and practices. It would be entirely unfair
to close this chapter without presenting the other side of the picture.
It should be appreciated that the export of unprocessed pulpwood has
yielded millions of dollars to Ontario in Crown dues and revenue of that nature.
It has paid further millions in wages to woods workers (some of whom were
prisoners-of-war), much of which was paid in years when it was desperately
needed. Transportation systems and suppliers of equipment, food and fodder
for woods operations have reaped substantial benefits from the trade. It has
had a stimulating influence on the price of pulpwood which farmers and settlers
produce from their lands. This is not the least of its benefits, and provides one
of the soundest arguments for the continuance of exports. The Canadian re-
presentatives of the United States companies involved are, in general, a splendid
type of citizen and many of them have given generously of time and money to
philanthropic causes. Most of the companies have co-operated liberally with
Canadian industry in the development of logging technique and equipment.
GENERAL COMMENT ON EXPORT OF PULPWOOD
If the unsound forestry practices inherent in existing agreements were
eliminated; if the use of unfair and destructive tactics in the hiring and paying
of woods workers were stopped; if, instead of "mining " spruce, the companies
concerned concentrated on the removal of all pulpwood species in relation to
their occurrence on their limits and finally, if the present illogical grouping of
[1531
A good pulpwood stand on the limit of an exporting company.
limits operated were rationalized, I am convinced that there would be an even
greater quantity of wood available, over and above the present domestic re-
quirements, than is the case at present. The possibilities and methods will be
treated with in the final chapter of the report.
Whether the export of unprocessed wood is sound as a long-range policy
for Ontario is open to grave doubts. I cannot believe that any system of long-
term agreements, which permit over-cutting of timber and "mining" of the
most desirable species, is a sound policy. As long as the present export policy
continues in effect, the people of this Province may well be classed as "hewers
11 54 1
of wood" for the United States mills who are the beneficiaries. It is to be noted
that no Canadian company which has an export agreement has a Canadian
paper mill dependent upon the area leased. It is only by manufacturing a
more highly developed product than pulp that we shall reap the optimum ad-
vantage of our forest resources.
For the present, export can be defended and any remedial action taken
should be gradual rather than precipitate. The national feature of the problem
should be properly weighted but not overweighted, as is the tendency in some
circles. Companies which have maintained operations in the Province for many
years have a greater claim to consideration than those which have entered the
field recently.
I was much impressed by the argument in one brief presented before the
Commission. It pointed out that unprocessed pulpwood exported has a value
of roughly half a cent per pound, but if this same wood were processed it would
result in a product worth at least four cents per pound and possibly several
times that amount. The difference in cost per pound between the pulpwood
stage and that of the finished product would be made up largely of wages paid
to Canadian labour. I subscribe to the idea expressed, and recommend
that the future policy of the Province be aimed toward the development
of the final product at the higher cost per pound. In the meantime, there
should be made available for export only the annual growth which is surplus to
the needs of present domestic enterprises and their normal expansion, including
the building of new mills.
[155
CHAPTER XVI
Labour
The woods workers in different parts of the Province work under a wide
variety of conditions with respect to wages, housing, feeding, transportation, etc.
Present day conditions are very different from those existing on lumbering
operations in their hey-day, when workmen signed on for the "run" or until
operations were completed, and lived under somewhat primitive conditions of
housing and feeding. In those days the "lumberjack" usually returned year
after year to the same company and served it with a fierce loyalty, even to the
extent of engaging in physical encounters with competitors. There was an
intense pride in workmanship, and men vied with one another in cutting or
hauling more logs than their comrades and in being the last man ashore when
the jam in the river was released. Companies were smaller, and a more personal
relationship existed between employer and employee than is at present possible.
Monthly wage-rates, extremely low in comparison with to-day's earnings,
were then the rule, with piecework almost unknown. Workmen's Compensa-
tion, and Health Department inspections were almost unheard of, but it should
be mentioned that the more responsible lumber operators in those days were
generally kind and generous to employees suffering accident or illness.
To-day the story is of almost a complete reversal of these conditions. Woods-
men do not return year after year to the same employer. There is little evidence
of loyalty to, or affection for, the corporations employing them. They rarely,
if ever, see or know the "big boss " who is responsible for their well-being or
their shabby treatment, whichever may apply. There seems to be little pride
in accomplishment of good work well done, and the production rate per man-
day is falling. About the only similarity to the old conditions which remains
is the lack of thought for the future of the resources from which they make their
living. Unfortunately this is not to be wondered at, as it is apparently the
attitude of the general public.
Living-conditions in camps are healthy and comfortable, though not very
attractive. Food is generally of top quality, and many woods workers suffer
gastric disturbances because of its richness. Workmen's Compensation pro-
vides for lost time and impairment of earning capacity, of either a temporary
or permanent nature, resulting from accident. The Department of Health in-
inspects and reports on camps, though many of the camps of small jobbers and
"shackers" seem to have been missed. I recommend a much more thor-
ough examination of these smaller camps, as I believe the conditions
which were apparent in many small camps during my inspection tour
in 1946 would not be tolerated under even a lax system of inspection.
Practically all the larger camps across the Province were satisfactory from the
hygienic standpoint, though in some instances I was struck by the fact that
drier sites could have been selected.
Larger camps are normally electrically lighted and arrangements are pro-
vided for washing clothing, by contract, at low rates. Drying-rooms for wet
[1561
clothing are usually provided although medium-size and smaller camps, in many
cases, still permit drying of clothes in living quarters.
Cooks are not generally well trained, and are wasteful. No standard of
training has been set up, except on a very minor scale through courses for cook
instructors under the auspices of the Woodlands Section of the Canadian Pulp
and Paper Association. Wide possibilities for saving exist in the preparation of
food. A drive conducted during wartime by the Army to eliminate waste by
improvements in the training of cooks, the provision of weekly diet sheets and
the daily inspection of garbage cans, resulted in reductions in Army food costs
per man-day (exclusive of preparation) to roughly one-half those generally
applying on woods operations in this Province. It is true that the woods worker
requires more calories than the soldier in camp, but he does not require twice as
many.
There will be more than 10,000,000 meals served on woods operations and
drives this year in Ontario. It is not difficult to see the savings possible through
the reduction of meal costs by one cent. From Army experience, I am certain
that food costs could be cut by at least 10 per cent (roughly three cents per meal)
through the proper training of cooks and the elimination of waste. This could
be accomplished concurrently with an improvement in the quality of the meals
and a diminution in gastric disturbance caused by excessive quantities of grease
and shortening, both of which are difficult to obtain. The possibilities of central
baking and cooking, with distribution of food in thermos containers to woods
workers, comparable to Army practice, have not been appreciated and no pro-
cedure of this kind has been attempted on any considerable scale.
Industry is missing a splendid opportunity by failing to develop a central
cooking school where men and women of proper aptitude could be taught to
prepare suitable food for woods workers and. through prior arrangement of
menus, to avoid the waste which is inevitable when three or more kinds of meat
and half a dozen types of pastries are placed on the tables at each meal.
Payment of woods workers by piecework has resulted in many anomalies
and much that is detrimental to forest management. Workers naturally demand
to be allowed to cut in the best stands, with resultant high-grading of the forests.
Poor stands are left to be cut by day-labourers, with few or none in sight because
of the high piecework rates. Rates now paid permit a skilled and energetic
workman to earn sufficient for his needs by working between 15 and 20 days per
month. This reduces the amount of wood produced per man per season, thereby
accentuating the labour shortage. Many workers consider that income tax
deductions take too high a toll from their earnings after $200 per month or
thereabouts has been earned, and consequently desist from what they term
"working for the Government". It is almost impossible to get men to work
at the less attractive jobs at any wage or piecework rate, as long as the rates for
cutting permit them to earn a sum commensurate with their views on income
tax and sufficient to enable them to take a few days off during the month to
spend it.
I recommend the joint study by representatives of woods labour,
industry and the Government, of a more reasonable wage structure than
that which presently exists on forest operations. I am convinced that
some type of daily or monthly wage schedule would be a healthier basis
on which to build than the present piecework system (if it can be called
a system), for there are so many variations which may be applied. I
11571
further believe that group incentives for camps or other units can be
evolved wrhich will minimize the effect of the reluctant worker.
Evidence was given, by the gold-mining group centred at Geraldton, that
men earning rates from $8.00 to $1 1 .00 per day were leaving the mines for woods
operations. One large operator gave evidence that he was paying unskilled
pieceworkers on pulpwood loading operations $12.00 to $14.00 per day, with a
bonus at the end of the season. Pieceworkers taking out poles can easily earn
more than that at prevailing rates. Such rates can only arouse consternation
amongst skilled mechanics and professional men who spend years acquiring
skills which result in lower earnings; unless controlled, they can only start
another dizzy spiral of ascending rates which eventually will remove Ontario
from competition in world markets.
I subscribe to the idea that a good forest worker requires skill, intelligence
and stamina equal, if not superior, to that required by most of his opposite
numbers in the mills. His pay and treatment should be commensurate. The
hourly rates now earned by many pieceworkers exceed all but the highest rates
paid in paper mills. This does not appear to be equitable and an unbiased
reconsideration of the situation by both labour and industry is indicated.
I strongly recommend the brightening of living conditions, includ-
ing more privacy for the individual, and the improvement of recreation
facilities in camps so that they may compete in a measure with the
drawing powers of the nearest beer parlors. Together with this, an
attempt should be made to create forest communities along lines ad-
vocated in Chapter XIX.
As mentioned earlier, I also recommend a joint study by the inter-
ested groups of an alternative to the present piecework system, and the
substitution of a more sensible method of paying workers.
58
CHAPTER XVII
Measurement of Timber
As mentioned elsewhere, the measurement of timber for payment of stump-
age is far from an exact science in Ontario. There are cords of three different
contents recognized for the same stumpage rates. Strangely enough, the opera-
tor who cuts four-foot unbarked pulpwood and whose practices for that reason
normally result in the best utilization, is penalized in comparison with those
cutting longer lengths or taking out peeled wood.
The most surprising feature in the measurement problem is the survival of
the Doyle rule long after all other provinces have discarded it. Its main effect
is to conceal true values and to bonus inefficient and harmful practices. Some
license-holders pay stumpage on Doyle rule and sell the product to sawmills on
Quebec log-rule which gives a much higher content than the Doyle rule does for
the same log.
It was developed as a rule-of-thumb method of measuring large logs and,
while it does not give absurd results for logs over 15 inches in diameter, it does
result in a very considerable undermeasurement. It has been the official rule
in Ontario since 1879.
A comparison with the International '/4-inch rule, the Quebec (Roy) rule
and the New Brunswick rule is enlightening:
Volumes of 16-foot logs
Small end
diameter of log
Doyle Rule
International Roy Rule
New Brunswick
(Ontario)
34" Rule (Quebec)
Rule
6"
4
20
20
20
7"
9
30
29
31
8"
16
40
39
40
9"
25
50
5!
48
10"
36
49
64
81
100
121
144
169
196
225
65
80
95
115
135
160
180
205
230
260
65
80
97
115
135
157
180
205
23!
259
64
W"
80
12"
96
13"
112
14"
130
15"
150
16"
170
17"
198
18"
229
19"
261
20"
256
290
289
300
21"
289
324
320
355
320
353
327
22"
362
23"
361
390
387
376
24"
400
425
423
432
The low values for small logs which the Doyle rule gives is a temptation
to operators on Crown lands to cut immature timber because of the large over-
run and the amount of slab material made available. It should be emphasized
M591
-fft^W..
""«»sg?* •«•,
■ ^'W*^*.w. .
Small l6-fool logs on a sawmill log-deck.. Log sizes may be gauged by comparing with the steel straps which are about
five inches wide. Stumpage payable on these logs when measured by the Doyle rule will be less than four cents each.
They will each yield about 30 board feet of comparatively low-grade lumber.
that none of the other rules above-mentioned over-scale if the sawmill concerned
is efficient.
The absurdity of the Doyle rule in the measurement of small logs is more
evident from the following tabulation showing cubic volumes.
One thousand board feet (Doyle rule) of 16-foot logs:
6 inches in diameter contain 1,070 cubic feet or 12.1 cords
7 "
8 "
9 "
10 "
11 "
12 "
13 "
14 "
15 "
As mentioned earlier, the values for logs over 1 5 inches in diameter are not
grossly out of line.
I have been told by those who defend the Doyle log-rule that the absurd
results it gives are, in effect, rectified by the practice of bidding for stumpage,
inasmuch as the size of the logs to be cut is taken into account by the bidders.
1 160 1
621 '
7.1 "
442 "
" 5.0 "
349 "
" 4.0 "
293 "
" 3.3 "
256 "
" 2.9 "
230 "
" 2.6 "
211 "
" 2.4 "
196 "
" 2.2 "
184 "
" 2.1 "
I have also been told that the Doyle rule is a good one because it "compensates"
the operator who cuts small logs and thereby incurs high costs, though why the
Crown should subsidize a practice which, in most cases, is both harmful and
inefficient, was not explained. I have found little evidence which would give
these defenders general support. In fact, the contrary is often the case. Taking
the cutting of spruce sawlogs in the season 1945-46 as an example, I have com-
pared the average size of logs scaled in each Forest District with the average
revenue per thousand board feet (Doyle log-rule) for each District. I find that
that District in which the largest logs were cut rated seventh (out of 13 Districts)
in the revenue received. The District ranking second in order of the size of
logs returned the lowest revenue per unit of all the Districts in the Province.
The District ranking third in the size of its logs returned the highest revenue
per thousand feet of all Districts. The same lack of any consistent relationship
between the stumpage received and the size of the logs cut is evident in the
case of the other species of timber.
Putting the products of the forests to uses to which they are not well suited
always involves an" economic loss but, because of the odd results arising from the
use of the Doyle log-rule, such losses are greatly magnified in Ontario. For
example, at the 1945-46 average rates of stumpage payment, the Government
of Ontario sold 1,000 f.b.m. of six-inch spruce sawlogs for $5.74. These logs
would make 12.1 cords of pulpwood providing a revenue of $20.31; thus a po-
tential loss amounting to about 253 per cent of the actual revenue was incurred.
ICOO j.b.m. (Doyle log-rule) of six-inch logs.
CROWN REVENUE *5.74 (AVERAGE)
6"SAWL005 MEASURED BY DOYLE LOG RULE
CROWN revenue20.51 (average)
SAME WOOD MEASURED IN CORDS.
The corresponding figures for logs of other sizes were as follows:
Diameter of sawlog
in inches
Revenue per
1,000 f.b.m. sold
Potential revenue from
same material if made
into pulpwood
Potential loss of
revenue as percentage
of actual revenue ji
On the other hand one cord of spruce pulpwood composed of I 7-inch logs
would bring only $1.67 revenue, while the same wood made into sawlogs would
bring a revenue of $3.02; thus a potential loss amounting to about 81 per cent
of the actual revenue was incurred.
[161]
One cord (or equivalent) of 1 7 -inch logs.
CROWN REVENUE ^167 (aVERAGe)
ONE CORD OF BOLTS 17" DIAMETER
CROWN REVENUE ^ 302 (AVERAGE)
SAME WOOD IN 5AWUOGS MEASURED BY DOYLE BUUE
The corresponding figures for logs oi other sizes were as follows:
Average diameter
Revenue per
Potential revenue
Potential loss of
of pulpwood bolts
cord sold
from same material if
revenue as percentage
in inches
cut in sa^vlog sizes
of actual revenue
15
$1.67
$2.73
64%
14
1.67
2.57
54%
13
1.67
2.39
43%
12
1.67
2.19
31%
11
1.67
1.97
18%
10
1.67
1.72
3%
So, wherever a tree from Crown lands is put to a wrong use, the Treasury of
Ontario is the loser — and the Doyle log-rule ensures that this loss will usually
be large.
It must be kept in mind that stumpage rates in sawlog agreements,
as well as licenses, have been based on the Doyle rule; if, as I recommend,
it should be eliminated, this fact should be taken into consideration
and corresponding adjustments made in rates.
However, in the final chapter of this report I recommend a complete re-
orientation of the present concept of the allocation and methods of operating
forest resources. I also recommend cubic measurement of all forest products,
with a single stumpage rate for each species, regardless of the end-use of the
■wood. One of the present anomalies is that the lumber industry, with a com-
paratively low-value end-product, pays a higher stumpage rate per cubic unit
of wood for logs over eight inches in diameter than is paid by the pulp and
paper industry, which produces end-products of higher value. The curves
below indicate the inequalities in existing practices and point the way to more
sensible utilization. Logs in the low diameter-classes (under eight inches in
diameter) should be utilized for pulp wherever it is possible to divert them to
that use and, conversely, larger logs should be diverted to lumber manufacture.
The Chart on the opposite page shows how the relative values of sawlogs and pulpwood change with
changing diameters of the logs or bolts. The solid-wood content of a cord is practically unaffected by
the size of the bolts it contains, but the solid-wood content of one thousand board feet of logs, when
measured by the Doyle log-rule, varies widely with the size of the logs. This chart shows that above
a diameter of about eight or nine inches, sawlog operators pay far more for wood than pulpwood oper-
ators, while in the case of smaller logs the opposite is the case.
EXAMPLE OF HOW CHART MAY BE USED:
Question: How does the value of spruce sawlogs at, say, $6.00 per thousand feel {Doyle log-rule)
compare with the value of spruce pulpwood at, say, $1 .75 per cord.
Answer: The horizontal line from the $1.75 point in the left-hand margin intersects the curve
marked $6.00 M at the vertical line representing a small-end diameter of about 9^4 inches
on the bottom scale. Therefore, sawlogs larger than 9'^4 inches in diameter cost more than
the same wood cut into pulpwood, while sawlogs less than 9^^ inches in diameter would be
cheaper than the equivalent quantity of pulpwood.
[162]
163
Before leaving the matter of the measurement of sawlogs, I want to em-
phasize most strongly that the abandonment of the Doyle log-rule in favour of
a more accurate and equitable method of measurement, coupled with an adjust-
ment in stumpage rates, will do much to promote both efficiency in sawmilling
and good forestry practice.
I am well aware that many lumbermen benefitting from the gross under-
scale by Doyle rule will not acclaim my recommendation, but I am convinced
that the proposal I make in the final chapter of this report will far more than
offset any loss of privilege Ontario lumbermen will suffer by reason of discarding
it. I see no reason for continuing a privilege at the expense of the Crown at
any time, but least of all do I approve when, by a rational approach to the whole
problem, the interests of both the Crown and the industry can be advanced.
If carried out, my recommendations will result in a higher revenue for the Prov-
ince and lower costs of sawlogs and of sawing to the lumbermen; but — perhaps
most important of all to both parties concerned — they offer a bright prospect
for the continued existence of this vitally important industry, which certainly
is not in evidence to-day.
In any revision of scaling methods, I recommend that the guiding
principle be the greatest possible simplification commensurate with
results of practical accuracy. I suggest joint study by government and
industry of a method by which all logs or bolts will be tallied by full diameters
and a series of possibly four grades established at different stumpage rates.
Solely for the purpose of illustrating the principle I have in mind, I offer the
following examples (the percentages and stumpage rates are only indicative):
Logs or bolts under 10% defective Class A — Stumpage
$4.00 per unit.
Logs or bolts over 10% but under 25% defective. Class B — Stumpage
$3.00 per unit.
Logs or bolts over 25% but under 50% defective. Class C — Stumpage
$2.00 per unit.
Logs or bolts over 50% defective Class D — No stump-
age.
This would simplify scaling and the scaler could be required to mark A, B,
C, or D on the log-ends as he scaled, thus facilitating check-scaling. The highest
stumpage would then be payable on the better logs, thereby encouraging the
utilization of much material now culled and left in the woods.
As mentioned elsewhere, cords are not consistently measured on the same
basis by the Department of Lands and Forests. I recommend that the de-
finition of a cord set out in section 22A of the "Dominion Weights and
Measures Act", as passed on 25th May, 1935, be adopted. This states
in part that "the cord shall contain one hundred and twenty-eight (128)
cubic feet". I further recommend that the stumpage rate charged for
peeled pulpwood should be higher than the rate for similar unbarked
wood. The difference in rates should recognize, not only the difference
in the actual volume of wood contained in a cord of peeled pulpwood
as compared with the volume of usable wood in a cord of unbarked
wood, but also the waste inherent in peeled wood operations. I con-
sider that the rate per cord for peeled pulpwood should be not less than
15 per cent greater than the rate per cord fonsimilar unbarked wood.
f 164 1
i
^«%-- _. -'^ •
^■^
j^^BfP^ ■.""i«*.%' ^^B
¥
■"■•>»'_'.^^-
m
An unevenly piled sl^idway of small sawtogs in Western Ontario. Because oj the careless piling it
would be impossible to measure accurately the lengths or diameters of many of these logs.
So far in this chapter I have dealt exclusively with the units of measure-
ment used in scaling wood in Ontario, but before leaving the subject I should
say something about the preparation of wood for scaling. I have commented
favourably upon the manual of instructions which sets forth the duties of scalers
and the working methods they should adopt. I recommend that the next
edition of this manual set forth the methods which operators should
follow in piling logs or pulpwood bolts. In my recent field inspections I
have found many and widespread instances of poor piling of both logs and
pulpwood. A large number of such piles were photographed and two of these
photos appear as illustrations.
Poor piling practices make the work of the scaler both difficult and expen-
sive, but I am even more concerned over the fact that they are also a possible
cause of loss of revenue to the Province. I therefore recommend that rules
be drawn up setting forth the conditions which must be met in piling
either logs or bolts, with appropriate penalties for their non-observance.
These rules should provide that:
(a) One end of all skidways or piles be flush so that both diameters
and lengths may be measured.
(b) Only one species be piled in each pulpwood pile or, if mixed,
stumpage shall be paid as if the contents were all of the species
carrying the highest rate.
(c) No deductions to be made for faulty piling. (Percentage de-
ductions for poor piling are impossible to check and the privilege
[ 165 1
A poorly built sk.idway of pine sawlogs. Ends are uneven, thus malting proper measurement of either diameters
or lengths impossible.
Four-foot wood cut for export. The several species in this pile had to be scaled separately entailing
scaling costs equal to, or greater than, the stumpage received.
is open to abuse at the expense of the Province. The remedy
for the operator lies in his insistence upon proper piling.)
(d) Short logs be piled on top of larger ones in cases where logs of a
different length are mixed on a skidway.
Pulpwood used in Ontario or exported through Ontario ports of exit may
come from either Crown lands or private lands within the Province, or even
from outside the Province. Once pulpwood has been scaled and started on its
way to its destination, one stick becomes indistinguishable from another and
after it has been moved from the landing where it was scaled, it is virtually im-
possible to tell whether or not it has been assessed for export levy. In my
studies concerning permits or clearances for export, I have discovered several
possible methods by which an operator could defraud the Government. I
found no specific instances where this had been done, but I believe the possi-
bility should be removed.
I therefore recommend that every stick of wood cut for export be
distinctively marked, at the expense of the operator, either by the use
of paint or by end-stamping with a hammer. This practice is carried
out on certain streams in Quebec, for sorting between companies, and
is entirely feasible.
167
CHAPTER XVIII
Land Classification
Contrary to the opinion of many, land classification is a very complex
problem which cannot be solved by sending a soil specialist and a map-maker
into a district to delineate those areas which may properly be allocated to agri-
culture, forestry, game preserves, or other uses.
It is simple enough to indicate what will grow best on various soil-types
but the problem has other important angles which must be considered if the
results of soil classification are to be of true value. Those undertaking such
surveys should know whether pressure for agricultural production or some other
consideration is more important than the need for conservation of timber, game,
and recreational and other facilities.
Before opening an area for settlemt, the administration of the day should
decide what needs will govern in its development. If the decision is wisely
taken, much suffering and many disappointments may be avoided. Thousands
of abandoned or semi-abandoned farms in the Clay Belt and west of the Lake-
head bear testimony to the fact that something more than a capacity to produce
farm crops is necessary to maintain settlers on land after it has been denuded of
timber. Problems of markets, roads, schools and social life are of paramount
importance, and neglect to weight these factors properly can only result in later
distress and disillusionment.
Such neglect in the past has resulted in colonist developments sprawled
over wide areas, when greater agricultural production, if that was the aim, could
have been obtained from a much smaller and more compact area located on
more productive soils close to the amenities offered by population centres. One
agricultural scientist testified that thirty good farmers located on some of the
better soil close to Cochrane could grow more farm produce than is now pro-
duced by hundreds widely scattered throughout that whole region.
The same witness pointed out that agricultural soils in Southern Ontario
are graded A, B, C, D, E, etc., in conformity with their productive capacity,
but in Northern Ontario, while the same system is used, grade-A soil is com-
parable in productivity only to grade-C soil in Southern Ontario. In other
words, the best Clay Belt soils would only rate third class in Southern Ontario
where farms in organized communities may be purchased for the value of the
buildings upon them, or even for less. If more farm produce is required, it can
be obtained more quickly and more cheaply by diverting effort from marginal
farmlands to farmlands in Southern Ontario now underdeveloped for lack of
farm labour.
The above discussion, I believe, indicates to some extent the responsibility
of the administration in opening land for settlement. It should first decide
whether or not such settlement is desirable or necessary and, if so, whether
agricultural or other considerations should be paramount. Having made these
[ 1681
Rich farming country typical of a large part of Old Ontario.
decisions, the soil expert and the geographer may then be sent in to classify the
land on a basis which will ensure satisfactory social and economic results.
It must always be kept in mind that, if soil and topography are suitable,
forest lands which have been operated by forest industries may immediately be
devoted to agriculture, but the reverse is not the case when lands have been
cleared or devastated unwisely for actual or alleged farming pursuits; it may
take upward of a century to restore them to their proper use.
The pictures in this chapter graphically portray the long-term possibilities
of land classification. Farms of the better type have for generations fed into
our national life a stream of citizens of which any nation might be proud. Poorer
soils produce citizens who generally deteriorate progressively with succeedmg
generations to a point where they are problems, rot assets, to their communities.
Land classification and description cannot in themsevles change land usage,
and sound practices will develop on a wide scale only when a majority of those
concerned are educated to a point where they understand the problems posed
and endorse the solutions. With this end in view, governments should make
educational material available and provide the machinery necessary to imple-
ment the action which should be taken.
Without a stabilized policy concerning the opening of lands for settlement
and the machinery to implement it, soil specialists, with their economists and
map-makers, are working in the dark and subsequent administrative action
taken may well nullify their best efforts.
M691
For the future, therefore, I recommend a further tightening of the
control over new settlements. If a new area is to be settled, the Gov-
ernment should decide its main purpose and then the soil specialist
and others may sensibly prepare the plans upon which it may expand.
In this way, the best possible facilities may be provided in the way of
roads, schools, churches and integrated community life. Such action
would be almost a complete reversal of past processes which tend to-
ward a waste of resources, poverty, disillusionment and, worst of all, a
lowering of human morale. Three generations in comparative isolation
on unfruitful soil unfortunately seem to raise a high percentage of
morons. There is little excuse for continuing to permit people to settle
on land which is likely to produce citizens of low quality.
I recommend a Province-wide classification of forest lands, deline-
ating areas as follows:
(1) Soils which under present standards will never be suitable for
agriculture and which should be protected from such encroach-
ment.
(2) High-quality, easily developed soils where the topography per-
mits of agriculture and where the climate will normally allow
cereals and vegetables to mature.
(3) High-quality soils as in class (2), where climatic conditions nor-
mally prevent cereals or vegetables from maturing.
Starvation farming. Poor land-use through attempting agriculture on forest-type land. West of Denbigh,
Lennox and Addington County.
>^
(4) High-quality soils where topography, drainage or clearing prob-
lems render them likely to be uneconomic as compared to more
favourably situated farms.
(5) Marginal soils where some adverse condition, or combination of
adverse conditions, makes the success of agriculture doubtful.
Combined with and superimposed upon the above classifications should be
data concerning the possibilities of the development of fish and wildlife or tourist
enterprises. Such considerations may radically change the outlook on many
marginal sites. It is only by properly weighting all these factors that sensible
land-use may be decided upon.
71
CHAPTER XIX
Forest Communities
Much has been said during recent years concerning the necessity for and
possible advantages of forest communities where woods workers could live with
their families, or at least be with them at week-ends. It has been suggested
that the woods workers of the communities should be employed by local forest
industries during a major portion of the time, and that they and their families
might cultivate small holdings and during off seasons, engage in fishing, hunting,
guiding, handicraft enterprises, or other occupations inherent in forest life, or
that these occupations might even form their major source of income.
There is little ground for argument as to the desirability of communities of
this nature or that they would probably serve as a potent force in reversing the
flow of rural citizens to the larger population centres, a benefit not to be ignored.
Each community would help to stabilize woods labour and assure that a nucleus
of well trained woods workers would always be available in the vicinity of local
forest industry. Pleasant, healthy and gainful occupation would be provided
for many, with consequent advantages to both employer and employee alike.
Some of the projects suggested have not dealt entirely in economic realities,
and it is unlikely that they could be carried out without loading an unjust burden
on the taxpayers.
It has been proposed chat each charter member of a community be granted
an area of timber land on which he could cut timber for sale to industry. Houses,
with modern amenities, would be grouped in villages. Roads necessary for
exploiting the area would be developed to open up the various minor water-
sheds. All members of each family, if they desired, could engage, at least a
part of the time, in various enterprises, including handicrafts. A paid manager
or overseer would co-ordinate and direct all the enterprises of the community.
In my opinion, this type of forest community can never succeed, for various
reasons, some of which are as follows:
(a) The capital cost of houses, roads, schools, churches, communication
systems and miscellaneous service would average considerably more
than $5,000 per family.
(b) Land-tenure would be an almost insurmoutable barrier, except on a
tenant basis. If deeded outright to a member, no matter how careful
the initial selection might be, there would be no guarantee that his
offspring would desire to lead the same kind of life, or for that matter
that he would have male or any descendants of the physique or aptitude
for forest enterprise. In such instances, title would necessarily pass
to another citizen who might be of a most undesirable type.
(c) The per capita cost of building, maintaining and snow-plowing the ex-
tensive road-systems envisioned would be well above the average for
rural Ontario because of the greater mileage per family.
(d) The necessary government assistance per worker, in opening up such a
community, would amount to more than that given to returning war
[1721
veterans; this would, I believe, be inequitable and unpopular. The
temptation, too, to reduce city relief costs by transferring the recipients
to forest communities might well prove too great to be resisted.
I am firmly convinced that the type of forest communities which will suc-
ceed will be those sponsored by the operators. They can be strategically placed
with reference to watershed development, and may be built by the operator to
rent at cost, or co-operatively built, with the operator supplying materials at
cost and the individual supplying the labour.
In either event they can be so located that mechanical transport can pick
up the workers in the morning and return them to their homes in the evening.
(In some locations this may prove feasible only at week-ends.) The advantage
of this system is the elimination of many bush camps of the barrack type, with
their inevitable colony of clerks, cooks, choreboys, etc. Some of the larger
organizations in British Columbia now practice this system to good advantage
and with very considerable economy. One operation I visited on Vancouver
Island in 1946 maintained in a company-camp at the highway only 60 out of
roughly 240 woods employees. Only one cookery and one clerical set-up ser-
viced the whole operation, although cutting was scattered over a considerable
area, in some places up to 20 or more miles from the community. The scheme
advocated in the final chapter lends itself admirably to a development of this
nature.
Whatever the type of the forest community of the future, I believe that
the present barrack-type of camp will eventually disappear, except for the
housing of seasonal labour whose employment will diminish with the develop-
ment of communities. I recommend that operators give thought to build-
ing attractive recreation-rooms, with provision for social activities and
amenities. Such recreation-rooms have been provided by many mill organiza-
tions in places where the needs are not so great, but their value in maintaining
employees' morale has become apparent to senior executives.
Work in the woods can and should be one of the most attractive forms of
manual labour. It can be made so if as much effort and imagination is applied
to the problem as that applied by competing industries iu order to attract workers
to urban enterprises.
173
CHAPTER XX
Comment on Swedish Forestry
A widely held idea persists that conditions affecting forestry in Ontario are
similar to those in the Scandinavian countries, particularly Sweden, and that
their forest practices could be adopted in Ontario. I wish to dispel this idea;
the differences are far more numerous and important than the similarities.
They fall under several headings:
(1) In the matter of tenure of lands, over 90 per cent of Ontario's forests
are owned by the Crown, while only 20 per cent of Sweden's are in
that category and they are located in the more inhospitable climate of
the north.
(2) Ontario has an inland continental climate, in contrast to Sweden's mari-
time weather conditions which more closely resemble the climate in
Nova Scotia. Annual precipitation in Ontario and Sweden is com-
parable, but the distribution of rainfall during the summer months is
generally better in Sweden than in Ontario. This, coupled with the
higher humidity found in a maritime climate, results in lower fire-
hazards than are normal in this Province.
(3) Ontario has seven conifer species reaching maturity over a range of
60 to 150 or more years. Sweden has two conifer species of practically
equal maturity-age, one of which, Scotch pine, has not proved satis-
factory when attempts have been made to bring it to maturity in
Ontario.
Southern Ontario has ten or more native hardwood species of com-
mercial importance, again varying widely in maturity-ages. These
reduce to two in number in the more northerly areas. Sweden has only
two important hardwoods, birch and poplar, except for a small area in
the south where beech, ash, oak and alder are found. Hardwoods are
not as widely distributed or as important in the forest economy of
Sweden as they are in Ontario.
It can therefore be appreciated that the silvicultural problems posed
in developing wise cutting-methods are much more complicated in
Ontario than in Sweden.
(4) Sweden has a large number of rivers flowing from her western border
to the sea. Nowhere in that country are the forests more than two or
three miles from drivable streams which carry the products to tide-
water. Ontario is far from having similar conditions; in fact in many
areas hauls to drivable water are several times as long as in Sweden.
(5) Sweden has road systems, built over the centuries, which traverse all
her forest areas, except the most northerly ones where transportation
conditions and, incidentally, forestry methods are not much superior
to our own. Ontario needs some thousands of miles of forest roads
M74 1
before forestry methods on a scale comparable to those practised in
Sweden can be attempted.
(6) Sweden has lower woods wage-rates than Ontario where the rates are
influenced by and are now equal to, if not above, those paid in mining
and the heavy industries generally. Wage rates have a profound effect
on the intensity of forest management economically feasible for the
operator to remain in business.
(7) Sweden has 90,000 square miles of forest out of a total area of 173,000
square miles, one-third of which is water, rock or bog. Her forest
industries employ 94,000 people out of a total population of 6,500,000
and account for 43 per cent of the value of the Nation's exports. As a
result, her people are all "forest conscious" and realize that their na-
tional life depends upon continuously productive forests. There is no
such consciousness in Ontario where a vast majority of the public know
little of their forest heritage and are apparently indifferent concerning
its future.
(8) The density of the average stand in Sweden's forest areas is nearly
ten cords per acre (845 cubic feet) and the annual increment per acre
is calculated at 28 cubic feet (just under one-third of a cord). The com-
parative figures for Ontario are unknown, although it would appear
from tests made that a considerably higher annual increment than is
mentioned above is possible in the southern portions of this Province.
It must not be supposed that forest practices in Sweden are completely
developed and inflexible. Considerable differences of opinion exist there con-
cerning regeneration and cutting practices which are still under development
and vary widely between the south and the north. The services of technically
trained foresters on both the forest-engineer and the forest-ranger level are much
more widely used there than here and their whole administrative set-up is dif-
ferent.
CROWN OWNERSHIP OF MILLS
The Swedish Crown came into possession of several sawmills and a sulphate-
pulp mill during the depression years and now owns eleven mills which are
operated as joint-stock companies and are required to show a four per cent
profit. The extent of its competition with private industry in extracting, pro-
cessing and marketing forest products is therefore sufficient to act as a finger
on the pulse of the market.
CROWN REGULATIONS ON PRIVATE LANDS
The Crown does not interfere directly with the disposal of timber by private
owners but, by tradition, there has been some control over cutting extending
back, in some cases, well over 100 years. Laws have been enacted:
(1) prohibiting the further acquisition of forests by private companies,
(2) prohibiting clear-cutting,
(3) prohibiting measures likely to endanger reproduction, and
(4) protecting the fauna of the forests.
M751
FOREST ADMINISTRATION
The Ministry of Agriculture deals with all forest lands, whether owned by
the Crown or by private agencies, except church lands which are not extensive.
Administration is under a Director-General who is head of the Royal Forest
Department.
Day-to-day problems are managed mainly by semi-independent boards set
up by the Ministry. There are two education boards, one which supervises
higher forest education and the Forest Research Institute, and the other the
intermediate forest schools. Private forestry comes mainly under County Forest
Protection Boards, of which there are twenty-five. The work of all these boards
is co-ordinated by a central board at Stockholm — The Royal Forestry Board.
The Director-General has a seat on all boards, thus assuring their proper inter-
relationship.
The Royal Forest Department also administers Crown agricultural lands.
Its organization is as follows:
Director-General
I
Two Deputy Directors-General
Officer-in-charge
Northern Forests
I Officer-in-charge
Officer-in-charge Marketing
Agriculture
Officer-in-charge
Technical Bureau
(includes Working
Plans)
Officer-in-charge Officer-in-charge
Southern Forests Finance
Under these officers come 10 territorial conservators and about 110 officers of
the superior service, most of whom are in charge of forest divisions or the equi-
valent. All officers down to and including the territorial conservators are
located at Stockholm and set the policy, which is then left for the division officers
to carry out with a free hand.
The main purpose of County Forest Protection Boards is to see that farmers'
forests are properly managed. Most of the larger companies have their own
foresters and manage their forests very well. Some Boards have as many as
six trained foresters and three times that number of trained forest rangers, in
addition to the seasonal staff. Their duties include marking for felling, giving
advice on drainage and road-making, the discouragement of grazing and the
operation of nurseries.
The above statistical and administrative data are gleaned from a report
made in the summer of 1946 by a group of British foresters, headed by H. G.
Champion, CLE., Professor of Forestry, Imperial Forestry Institute, Oxford
University. This group visited Sweden and travelled widely through the
forested areas and visited the forest industries, accompanied by leading experts
in the various lines. It is printed in the Empire Forestry Review, Vol. 25, No.
2, 1946.
The vast gap between Swedish conditions and those of Ontario in the
matter of making use of trained personnel is readily apparent. It will take
several years of maximum enrollment in Canadian forestry colleges if the tech-
nical assistance for government and industry in Ontario is to approach, even on
a modest scale, Sweden's wide use of trained personnel. Only a start can be
considered to have been made in secondary forest schools (ranger schools) with
II 76 1
the recent establishment of an initial unit at Dorset. This type of educational
institution should be much more widely developed, and this could readily be
done in connection with the experimental forest areas recommended elsewhere
in this report.
I am convinced that, althought we have not yet trained sufficient foresters
to practice management on a level comparable with what is done in the Scandi-
navian countries, particularly Sweden, it would be wise for us to adopt many
of their industrial practices, particularly with regard to mill operation. I re-
commend a programme of visits to the mills of Northern Europe during
the next few years. Such visits would be more likely to be productive of
conservation measures and economic practices than any attempt to put Scandi-
navian silvicultural methods into practice in Ontario before we have the neces-
sary personnel. At the same time, only intensive research into the best Scandi-
navian, German or other continental or American practices which are adaptable
to Ontario, will evolve a system more likely to suit our forest conditions than
any yet developed.
11
CHAPTER XXI
Forest Operating Companies
A SOLUTION
Throughout this report there have been frequent references to a plan which
would be unfolded in the final chapter. As a preamble, I first deem it necessary
to set down certain conclusions forced upon me as the joint result of a wide-
spread survey of field conditions, a prolonged session of public hearings and a
critical analysis of the confusing array of existing forest legislation, regulations,
agreements, licenses, permissions and permits.
CONCLUSIONS LEADING UP TO SOLUTION OF PROBLEM
(1) I do not consider that it is, or ever will be, possible to achieve the
rational development of forest resources or to maintain our present
industries under the existing plan of limit allocation, with the confusing
and conflicting agreements and conditions in force.
(2) In view of the varying conditions in existing agreements, it never will
be possible to apply any over-riding regulations which would standardize
them to any considerable degree.
(3) It is not possible for either of the contracting parties to fulfil some of
the conditions recited.
(4) Most of the agreements are very one-sided and are indicative of ex-
tremely keen bargaining. Export agreements are based on an excep-
tion to the general law intended to prevent the very practice provided
for in the agreements.
(5) Many people on both sides of the international border believe that
there are still vast areas of virgin timber awaiting development. I
regret to say that the only area in which I found any considerable
quantity of mature timber in blocks of considerable extent, outside
areas covered by existing licenses and agreements, is in the Patricia
region, north of Lac Seul.
Enough timber for perhaps two moderate-size pulpmills and a few
medium-capacity sawmills still remains unleased in that district. (I
am presuming the construction of pulp mills by Long Lac Paper Com-
pany Limited and Huron Forest Products Corporation in their respec-
tive areas.)
(6) I am convinced that unless vigorous remedial measures are soon taken,
the lumber industry will continue to diminish in importance to such
an extent that before twenty-five years it will be classed as a minor
industry, which would be a major tragedy. If this should happen, it
will very severely affect every farmer, home-builder, mine, railway or
industrial enterprise which uses lumber or timber. A high mortality
M781
rate amongst secondary industries dependent upon sawmills may also
be anticipated.
(7) Single purpose operations in our forests should no longer be tolerated.
They are a symptom of the absence of co-operative effort between the
various groups within the forest industries. The resultant waste is a
reproach to all concerned and must be eliminated in any rational de-
velopment of the forests. The lack of co-operative effort between
members of the same group is painfully evident in many cases across
the Province.
(8) There is a lack of uniformity in the application of forest regulations
and a province-wide indication of insufficient staff to perform the work
expected of them.
(9) There is a widespread feeling that some individual operators have been
favoured more than others and that departmental action has been
slanted to the benefit of some groups. The text of Chapters IX and
XV gives substance to complaints on this score.
(10) Except in white pine, red pine and yellow birch stands, there is little
overmature timber in the portions of the Province now operated.
(11) I have not heard a word spoken in favour of the Doyle rule, except by
those who purchase stumpage from the government or woodlot-owners
on that basis.
(12) Throughout this report there have been recommendations concerning
the expenditures of considerable sums of money. The purpose of most
of this outlay is the rehabilitation of the forests of Southern Ontario
which is necessary for the continuity of both rural and urban enterprise.
In addition, increased budgets are required to supply the technical and
administrative staff, without whom inspection and supervision of Crown
lands will not be adequate or efficient.
Unless the public is willing to spend large sums of money on forestry in the
next quarter century, efforts toward improvement, or even maintenance, of the
present forest conditions will continue to be little better than a gesture. In
this connection, the financing of forestry in Southern Ontario should not be
confused in any way with the activities on or revenues from Crown lands in
other parts of the Province.
In view of the preceding conclusions, I shall now set down certain conditions
and principles which I believe should govern any action toward future forest
legislation or operational methods. This might form the nucleus of a forest
policy for Ontario.
PRINCIPLES APPLIED IN SOLUTION OF PROBLEM
(1) In future Government action, the principle of sustained yield
must ever apply. Any other course will spell eventual disaster
to many of our existing industries and the communities they
support.
(2) Legislation and regulations should apply equally to all opera-
tors. There must be adequate penalties, uniformly applied, for
evasion of regulations or waste of forest products. On the other
f 1791
hand, those operating on sound silvicultural systems should be
given every encouragement to develop the highest possible yield
from their areas.
(3) In any area cut over, all usable species must be removed to the
full extent of the capacity of existing markets to absorb them.
Naturally, when available markets cannot absorb the total pro-
duction of a given species, operations may be concentrated on
those stands which may be extracted most advantageously.
(4) Overmature timber must be removed before cutting in younger
stands may be permitted. The cutting of small areas of younger,
though not immature timber occurring in overmature stands
should obviously be permitted, particularly if it will reach over-
maturity before the next cutting-cycle.
(5) All cut-over areas must be stocked, either by natural or by arti-
ficial means, with a potential stand equal to or better than that
removed both as to species and density. Otherwise a continual
lowering of the quality of our forests is inevitable.
(6) In the case of other industries such as iron-ore mining, the pro-
ducer does not quote different selling prices depending upon
the ultimate destination of the product, whether it be used for
making ploughshares or rails, pen nibs or battleships, but treats
all users alike. I consider the Government should similarly
standardize its stumpage rates per cubic unit of any given
species, regardless of the final disposal of the timber. Natural
economic forces would then come into play and the logs or bolts
would automatically find their best market.
(7) I am certain that the method of levying government charges on
forest operations could be simplified and improved. I recom-
mend that, instead of several different assessments, only two
be applied.
One of these, which might be termed ''forest rental", would
cover all items of expense which continue regardless of the size
of the annual cut. It would include the revenues necessary for
the maintenance of staffs at Headquarters and in the field, to-
gether with the cost of their various activities such as research,
forest protection (including fire fighting), air service, etc. Needs
could be estimated with accuracy and rentals set for a period
of five or more years. I suggest that any portions of the estim-
ated fire fighting costs remaining unexpended in a particular
year should be carried forward to succeeding years within the
period, as a cushion against disaster. At the end of the period
a rebate should be made or, if a deficit exists, the assessment
for the ensuing period should be raised to reimburse the Treas-
ury.
The other charge might be called "stumpage" and would
include government revenue for timber cut and all items de-
pendent upon the quantity of wood cut. Zones of special
stumpage rates could, if necessary, be established to take care
of wide differences in operating conditions or for other reasons
[1801
such as Government tolls on roads or for other improvements
constructed for limit holders at public expense. Variations of
this kind should only be permitted on the broadest possible
basis, such as differentiating between timber on watersheds
draining into the Great Lakes and timber on watersheds drain-
ing into James Bay or Hudson Bay, with no effort made to adjust
differences between individual stands or operators. Endless
argument and inconsistencies would result if the basis were to
be narrowed.
Stumpage rates could properly be raised or lowered in con-
formity with the economic cycle applying to forest industries.
I see no reason why industries, which in past times of stress have
applied for and received rate-reductions from the Department,
should not, within reason, share periods of prosperity with the
same Department. There are sound arguments for raising
provincial charges on timber in times of high federal taxation
on industrial profits. While there is no quarrel with the idea
that the Federal Government should derive such benefits in
wartime, I point out that low provincial stumpage rates are
reflected in enhanced federal revenues from taxes on profits and
excess profits.
(8) I recommend that all wood, whether logs or bolts, be measured
on a cubic measurement basis. The Doyle rule has really only
one purpose, that of confusing the seller, and elastic contents
of cords have no place in a well ordered system of measurement.
For four-foot wood, a cord 4' x 4' x 8' could be converted on a
basis of 88 cubic feet if the wood is unbarked and 104 cubic feet
if barked.
(9) Speculation for profit on timber stumpage should be eliminated.
Limit holders with a surplus of wood beyond their needs should
be required to dispose of such wood at the government dues
applying, plus a fair return for carrying charges, say five cents
per acre per year, or a maximum of one cent per cord or its
equivalent per year, during the time ground rents, fire protec-
tion, etc., have been paid. Such a regulation would confine
corporations to a profit on the manufacture of their products
and prevent any on timber speculation.
(10) The amount of the export levy should be whichever is the great-
est of:
(a) $2.00 per cord, or
(b) The difference between the average cost of United States
wood delivered to the United States mill and the declared
cost of the wood imported from Ontario delivered to the
said mill, or
(c) The difference between the average cost of United States
wood delivered to the United States mill and the average
cost of Ontario wood for domestic consumption, plus
export profit (as mentioned later), plus the freight to
the United States mill at published rates.
[181]
-ONTARIO-
AVERAGE VALUES OF SPRUCE
LUMBER 5( CORRESPONDING COST
OF CROWN LAND STUMPAGE
(IN THE YEARS INDICATED)
1921 -z
r^rran
mil,
,..'111
|||||
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nil "imii
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1928-9
One dollar ol average
Crown dues & bonus
per 1000 f.b.m. of
lumber produced.
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nil 'iiyn
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1930-1 1933-4 '9389
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for ground rent , fire
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Chart showing a comparison of lumber values and slumpage costs oj spruce in Ontario in certain
significant years.
182
A memorandum submitted by a representative of the importing mills in
the Lake States indicated that Canadian wood is desperately needed for the
mills in question. There was no hint that this wood should be delivered more
cheaply than home-grown wood.
(11) Each area must be developed to its full growth capacity, with
cutting confined to the older stands, except under unusual cir-
cumstances such as insect epidemic or fire loss. An operator
who holds more limits than his mills require must operate the
limits to their full capacity for regrowth. On the other hand,
an operator must not cut more than the annual growth on his
limits. Until better standards are developed, the cut in coni-
ferous stands on watersheds draining into the Great Lakes
should not exceed 10 cubic feet per acre per year and in mixed
stands five cubic feet of conifers and five cubic feet of hardwoods.
On watersheds draining north or west, the cut should not exceed
nine cubic feet per acre per year.
ADVISORY COMMITTEE TO MINISTER
It is submitted that any legislation or any forest policy, no matter how
sound and workable, can be nullified by Government or Ministerial action.
Many submissions presented at the public hearings recommended the formation
of a Commission which would be above politics and which would provide con-
tinuity and impartiality to forest policy.
I am far from convinced that Commissions are infallible or that their mem-
bers can survive unless their policies are essentially in conformity with the view
of the administration. Experience of Hydro Commissions in Ontario and Quebec
during the past 10 or 12 years would indicate the fallacy of the impression of
continuity. After all, the administration of the day is responsible for the care
of provincial resources and it cannot escape its responsibilities tor the forests
by delegating matters of policy and management to a non-elective Commission.
There is little assurance that a Commission, however carefully selected or
well intentioned, will solve all its problems correctly. As an example, I might
mention the fact that the Workmen's Compensation Boards of Ontario and
Quebec follow diametrically opposed policies concerning merit and demerit rates
for good or bad accident experience, although such rating embraces one of the
main fundamentals of accident prevention.
I am very firmly convinced that public interest will best be served by the
departmental system under a Minister responsible to the people. I am just
as firmly convinced that measures should be taken to prevent a Minister from
reversing existing forest policy or promulgating new policies and only informing
the general public several years later.
To indicate the need for some type of check I point out that such policy-
reversing changes have occurred in the past without the general public being
aware of them for several years. It is difficult to take suitable remedial action
in such matters when they appear in a departmental annual report sometimes
three years after the event.
In order to provide reasonable continuity of forest policy when
changes of government, or even changes of Ministers, occur and to
1 183 1
guard against possible unwise or precipitate Departmental action, I
recommend that an Advisory Committee to the Minister of Lands and
Forests be appointed. Its membership should consist of one repre-
entative of each of the following groups or interests:
Education Forest engineers Mining
Railways Pulp and paper industry Building industry
Labour Lumber industry Finance
This Committee, which should have a permanent secretariat, should hold
periodical meetings, probably monthly, for which members would be paid fees
commensurate with directors' fees paid by large industrial corporations. At
these meetings, or at special emergency meetings, the Minister may lay any
problems, on which he wishes advice, before the Committee. Conversely, mem-
bers might ask for explanations of any Departmental action taken or contem-
plated. The Minister need not necessarily accept the advice of the Committee,
but could receive much benefit from their discussion of and reaction to any
major projects he might have under contemplation.
A group of the nature outlined would bring a wide cross-section of business
and professional experience to the service of the Minister and would, 1 believe,
achieve that continuity of policy so widely desired and advocated. Appoint-
ments might be arranged so that three members would retire each year, although
any member so retiring might be re-appointed if such action was agreed upon
by the Government and the group concerned. Practically all groups represented
have associations which could nominate suitable candidates for membership.
The representative of education could properly be the Dean of the Faculty of
Forestry at the University of Toronto.
If stability and continuity of forest policy is assured through the
appointment of a Committee of the nature described, then I recommend
that the Government of the Province should adopt a completely new
concept of the allocation and operation of Crown lands. Unless a re-
allocation of cutting rights of the nature outlined is adopted, I am convinced
that the present unbalanced and wasteful system of exploitation will cause a
continuous and progressive deterioration of forest resources. Only a major
reversal of existing policies can supply a remedy.
I consider that any attempt to provide a solution by applying new regula-
tions to the infinite number of conflicting conditions in present agreements is
doomed to failure. No partial solution can meet the needs of the situation.
Half measures can only postpone the evil day; I therefore offer none.
There are those who will point out that dire prophecies concerning the ex-
haustion of forest resources have been made over a long period of years and
that they have all grossly exaggerated the situation. In reply to those critics.
I would point to the decline of the lumber industry and the expansion of the
pulp and paper industry to our westerly boundary and into the smaller timber
in the northern areas along the timber line. The last forest frontiers are now
well in sight from present holdings and no new horizons will develop. Expan-
sion of forest holdings is coming to a close, and 1 hope we are now entering the
era of sensible operation of our remaining resources.
[ 184 1
LIMIT ALLOCATION
My proposal is as follows:
All licenses, agreements, permissions and permits shall be suspended for a
period of not less than ten years. In return, the Government will assure to
the present limit holders a supply of wood in perpetuity up to the present ca-
pacity of all domestic mills by a pooling of the resourses of all provincial Crown
lands and by establishment of a policy which will allow further expansion only
when it has been established beyond question that wood is available without
possibility of interference with domestic enterprises. Future extensions, com-
mensurate with the productive capacity of the tributary forests, will be pro-
vided for, if justified, as soon as the true capacity can be ascertained. Exporters
will receive quantities of wood commensurate with the productive capacity of
their present limits, but not necessarily from the areas their agreements now
cover. I recommend that no export be permitted from an area which
will prejudice the continued economic life or legitimate expansion of
any domestic enterprise. There is, however, enough material for all, includ-
ing sawmills and exporters, if it is properly harvested and distributed.
I contend that an assurance of standing timber in perpetuity is of more
value to a limit holder, for purposes of financing, than his present insecure tenure
under legislation which is now in the Statutes of the Province.
All Crown forest resources having been pooled, their sensible redistribution
becomes simple and the major defects of the present system can be eliminated.
I suggest that the Province be broken down into 12 areas along the lines gener-
ally indicated on Map No. 6. The areas shown are only indicative and may be
varied very considerably, not only with regard to boundaries but also in num-
ters, without seriously affecting the soundness of the scheme.
FOREST OPERATING COMPANIES
Of the areas indicated on Map No. 6 each contains several watersheds and
parts of watersheds and in general supplies a central group of forest industries.
Watersheds from which the wood will be delivered by rail are integrated with
adjoining watersheds. Individuals or corporations, who hold limits or operate
mills using the various forest products, would unite to form one Forest Operating
Company in each of the areas shown. This would combine and co-ordinate all
woods operations carried on within the area for any purpose whatsoever.
I believe that the right of the individuals and corporations concerned to
purchase wood from the Operating Company should depend upon the holding
of shares in that Company and that the quantity of such wood should be in
proportion to the number of shares held.
ALLOCATION OF SHARES IN FOREST OPERATING COMPANIES
It is unnecessary to work out here all the details of the organization of
these Forest Operating Companies but shares, with the ancillary right to pur-
chase wood, could be allocated on a combination of two factors:
(a) Average mill consumption or export shipment in units of wood by each
individual or corporation over a five-year period or, in the case of mills
which have not operated for a total of five years, average annual con-
sumption.
1185 1
(b) Area of limits now held by the individual or corporation within the
watersheds included.
Allocation of shares and wood entitlements to each unit of industry con-
cerned is entirely feasible and equitable on the above basis. Such allocation
will smooth out differences and eliminate unsound forest practices such as over-
cutting by mills too large for the limits which supply them, or under-cutting on
limits left partially dormant because they are too large for the mills they supply.
Shares should carry a fixed dividend which would be a charge against the
w^ood cost. Payment for shares could be made in cash or by shareholders turn-
ing over to the Operating Company their equipment, camps, improvements,
surveys, working plans, etc., all of which would necessarily be evaluated on a
standard basis by a referee or board of referees.
EXPANSION OF FOREST INDUSTRIES
No new industries or expansions of existing industries beyond those already
under way should be permitted until it is ascertained that there is sufficient
wood available to justify such expansion. When it becomes apparent that there
is a surplus of wood over current needs in any Forest Operating Company's
area, the surplus could be allocated by the Department of Lands and Forests to
the industry which will provide the utmost in continued employment in the
vicinity or, if necessary, could be diverted to some other Operating Company in
whose area a shortage of wood was found to exist. The allocation of surplus
wood should naturally be carried out after consultation with the industries con-
cerned and 1 can see where the Advisory Board to the Minister could be of
great value in advising on these allocations or dealing with complaints which
will be inevitable where large quantities of forest products are concerned.
If the right to purchase wood from the Operating Company is to be de-
pendent upon the holding of shares, provision will have to be made for the com-
pulsory sale of shares, at a fixed price, by individuals or corporations which
cease to utilize, for a period of say two years, the quota of wood to which they
are entitled.
PROVINCIAL REPRESENTATION ON BOARDS OF DIRECTORS
The Forest Operating Companies would be managed and administered by
boards of directors. I strongly recommend that the Province should have
a representative on the board of each such Company. It is realized that
having a member on such a board might lull the public into a false sense of
security but I believe that the over-all advantages of such representation more
than overbalance the disadvantages. In any event, the scheme is entirely
feasible without government representation on the board.
I would further suggest that the other members of the directorate should
be appointed from the various groups represented on the following basis:
(a) Where pulpwood-using industries have consumed the bulk of the wood
produced in the preceding five years:
Pulp and paper mill group 2 directors
Sawmill group I director
Pole and tie operators' group 1
Exporters' group 1
Small operators' group 1
M861
(b) Where sawmill operators have consumed the greater part:
Sawmill group 2 directors
Pulp and paper mill group 1 director
Pole and tie operators' group I
Exporters' group 1
Small operators' group 1
With such representation for the various interests, no particular group
would be able to dominate the situation. Directors, as soon as elected, could
proceed to select operating officials from amongst the best of the personnel of
all the groups represented, and actual forest operations could then be under-
taken.
OPERATING CONSIDERATIONS
In the initial stages of the Forest Operating Companies, cutting would
probably proceed in the same areas from the same camps and with much the
same personnel, and changes would gradually be undertaken over a period of
several years. It is emphasized that Forest Operating Companies could, and
probably would, use contractors, company camps with small operators, or even
allot to families small watersheds to cut over where circumstances so dictated,
and that the system used would be governed by a combination of the social,
silvicultural and economic considerations.
Consideration might well be given to the question of providing compensa-
tion to limit holders for ground rent and fire protection charges paid in past
years on limits turned over to the Operating Companies.
Preparation of a long-term working plan would be a responsibility of the
company, to be completed within three years. Approval of this working plan
by the Department of Lands and Forests would be necessary before its adoption.
All Forest Operating Companies should be required to organize along similar
lines and all data and returns concerning the forests would be standardized to
the fullest possible extent, eliminating the present difficulty encountered in try-
ing to assemble comparative data between regions or operators.
If, after a reasonable period of trial, say ten years, the original limit holders
should wish to return to the present uneconomic and unorthodox conditions of
forest operation, the question could be studied in the light of intervening ex-
perience. If, on the other hand, any limit holder for selfish or contractual con-
siderations, should refuse to enter into the project, the Department has sufficient
authority written into his present agreement to ensure the operation of the
limits involved to their full capacity and on sound forestry principles requiring
the use of each type of timber for its most appropriate purpose. Priority in
the use of waterways for wood transportation and in similar rights should be
allotted to Forest Operating Companies, in view of their greater importance in
the economic well-being of the Province.
ADVANTAGES OF PROPOSAL
At this point, the advantages of the above proposal begin to emerge. Not
the least of these would be the emancipation of forest operation from the short-
sighted policy of many mill executives who normally know little or nothing of
the inescapable effects of unsound forest practices and are mainly concerned
with immediate costs. Forest utilization would be conducted under the ablest
f 1871
and best trained woods personnel available within the various groups. Cutting
would be carried out in conformity with plans prepared in collaboration with
foresters who would protect against jeopardizing future forest conditions for the
sake of present dividends.
Mill executives would only need to calculate their wood requirements and
send a requisition to the Forest Operating Company, in which they hold an
appropriate share. Tentative requisitions for raw material could be made as
of January 1st in each year, to permit the Company to plan its season's work.
Final requisitions could be made, with the necessary financial adjustment, at
August 1st. I would suggest provision of working capital for the Company by
means of monthly advances by the operators at agreed rates, say $1.00 per cord
per month, commencing with the placing of the tentative requisition.
As soon as tentative requisitions are placed, the Forest Operating Company
could arrange its season's work to best advantage, purchasing supplies and
equipment, opening secondary roads, clearing streams, etc.
When cutting starts, the needs of each type of industry would be integrated
to the operation of each section of the forest. Materials suitable for poles and
ties, sufficient to meet the needs, would be cut into suitable lengths for that
purpose. Only straight logs in the larger sizes would be allotted to sawmills.
The vexed question of the definition of a sawlog would be solved. It is my
belief that nothing under 10 inches small-end diameter need be diverted to saw-
mills in order to maintain present production. However, if that estimate should
prove inadequate to meet needs, the minimum diameter could be dropped to
nine inches. If it gave indication of providing an excess over the needs for
sawlogs in any area, the diameter could be raised to 1 1 inches. The situation
would thus be always under complete control.
Jack pine could be diverted to kraft mills and to sawmills. Spruce, balsam
and jack pine could go to the pulp and paper mills in the proportions which
they can utilize. Poplar would go to soda-pulp mills, groundwood mills and
sawmills, and so on.
PRIORITY TO DOMESTIC MILLS
Priority in regard to timber in any area should go to domestic mills. If a
company has insufficient growing material to feed its mills in perpetuity, it may
call on an adjoining Forest Operating Company which has more than its domestic
demand. When better silvicultural measures restore the local balance, a read-
justment may be made. When domestic mills are assured of supplies in per-
petuity, then there can be less argument against the export of pulpwood within
the annual growth of the Province, provided always that the product manu-
factured from the exported pulpwood is not competing in the market of domestic
mills, or robbing them of a future economic source of wood supply.
Operating Companies should deliver wood to their own domestic mills at
cost (which would include the fixed dividend on stock). Wood produced for
other Companies should be permitted to carry a nominal profit over the cost to
domestic mills of possibly 50 cents per hundred cubic feet, and wood produced
for export should carry a higher rate of profit, possibly $1.50 per hundred cubic
feet.
PROFITS FROM MANUFACTURING PROCESSES
" '^
The duty of the Forest Operating Companies would lie in delivering ample
and suitable wood to domestic mills at the lowest possible cost commensurate
with sound forestry practice. Profit making by the member companies would
result from the efficient conversion of this wood to its various end-products,
rather than from luck or influence in the allotment of their limits, or from high-
grading or otherwise abusing the Province's resources.
JOINT DRIVING OF STREAMS
The sorting of logs, except for species, would be eliminated and drives on
streams would all be joint drives. The significance of this statement will be
realized when I mention that this co-operative idea would do away with ten
out of the eleven sweeps or rears annually carried out on the Nipigon River.
COMPARISON OF COSTS
Comparison of wood production costs could be made by a central organiza-
tion, such as the Ontario Forest Industries Association. It could tabulate the
costs from the various Forest Operating Companies, which would be kept in a
standard manner, and this information could be circulated periodically to all
companies. Costs out of proportion to the conditions prevailing would become
apparent and the companies could take appropriate remedial action.
OVERLAP AND DUPLICATION ELIMINATED
Overlapping in purchasing, storekeeping, accounting, engineering and ad-
ministrative effort generally would be eliminated. Central repair shops and
wood-working plants equipped with the most efficient machinery, and staffed
by highly skilled mechanics, would be feasible. Reserves of equipment, stores,
food and fodder could be drastically reduced and handled in a more scientific
and economical manner than is now the case.
LABOUR CONSIDERATIONS
Labour Unions would find their problems simplified in having a smaller
number of large operators to deal with in negotiating collective agreements and
should find it much easier to service such agreements than under present con-
ditions. The hiring of men would also be simplified through central agencies
who could hire large numbers and dispatch men in special trains at excursion
rates, instead of continuing the present piecemeal practices.
NEW AND DORMANT LIMITS DEVELOPED TO CAPACITY
The proposed scheme would bring into active production millions of acres
of forest lands belonging to the Crown, but not included in existing licenses and
agreements. Many of the areas are in themselves too small or too remote from
population centres to attract industry to them under the present limit-allocation
plan, but would fit admirably into the broader scheme of operations suggested
in this chapter. A glance at Map No. 8 indicates the locations of the areas
mentioned above.
JOINT TOWING OPERATIONS
The Forest Operating Companies whose products are delivered to the Great
Lakes should form a Great Lakes Towing Company which would organize and
carry out the movement of wood on the Great Lakes. This would completely
integrate the movement of wood from stump to mill and eliminate overlap in
effort and duplication of services and equipment.
11891
GOVERNMENT ADMINISTRATIVE ADVANTAGES
From the standpoint of government administration, the proposal would
eradicate nearly all of the detail work which is now most troublesome and time-
consuming. Instead of hundreds of operators, they would be dealing with about
a dozen. Stumpage rates and operating regulations would be standard across
the Province, instead of being fogged with hundreds of varying conditions as at
present. The boundaries of the Forest Operating Companies' areas and the
administrative districts of the Department could be made to coincide so that
each district office would have to deal with only one or at most two companies.
Accounting need not lag more than a week or two behind the scaling of wood
and the recording of stumpage dues or other forest charges. The result would
be that figures necessary for the preparation of the annual report of the Depart-
ment could be available within a month of the date decided upon as the end of
an operating year.
The greatest and most lasting effect of the proposed scheme, however, will
be derived from the full and rational development of each forest area along sound
silvicultural lines. Timber removal will be from limits which should logically
be cut over, rather than from areas dictated by limit lines or individual company
policy.
POSSIBILITIES
Both the Government and limit holders are justified in asking what are to
be the benefits of such a radical change of method in the treatment of Crown
lands and their development.
With the fusion of all groups and with management controlled by the most
efficient operating personnel available, all woods operations should be raised to
a standard comparable with the best carried on previously. There are enough
efficient operators to supply this leadership. Superimposed on the general in-
crease in efficiency of operation, will be the savings from the elimination of
separate drives and duplication in management, supplies, maintenance and
repair of equipment, engineering and items of a similar nature.
Judging from the waste of effort and material which I observed on widely
distributed operations, I am convinced that if the system advocated is adopted,
the average cost of delivered raw materials can be reduced by the equivalent of
$2.00 per hundred cubic feet, without any reduction in wages. This would save
some $6,000,000 per year for forest operators generally. For the sawmilling
group, costs of sawing would be reduced by at least $3.00 per M feet board
measure, due to the elimination of small, crooked and defective logs; while
average grades of lumber produced would be raised by $5.00 to $6.00 per M
feet board measure, a further benefit of $1,500,000 or $2,500,000, a generous
portion of which should be passed on to the public.
But the above more or less immediate benefits do not create the main value
in the scheme, which lies in an increased production from our Crown lands, with
an improvement rather than a deterioration of the forest resources involved.
The Report of Forest Resources of Ontario compiled in 1930 indicates
1 10,000,000 acres under forest protection. Of this:
1190 1
(1) 39,450,000 acres were classed as muskeg, barrenland, water, or recent
burn,
(2) 28,110,000 " " " coniferous stands,
(3) 34,460.000 " " " mixed stands,
(4) 7,980,000 " " " hardwood stands.
The following estimates are extremely conservative, as I have not taken
into account any growth on item (!) above; I have assumed a growth of 10
cubic feet per superficial acre on watersheds feeding the St. Lawrence drainage,
Rainy Lake, and Lake of the Woods; I have used a figure of nine cubic feet per
acre for the Central Divide (height of land) area, except its Kenora extension;
and for the Clay Belt and Kenora extension of the Central Divide, I have used
seven cubic feet per acre per year, not so much because of a difference in the
rate of growth, as because of the amount of marginal forest land, the stands on
which are of doubtful economic value.
Mixed stands have been estimated to produce equal quantities of softwoods
and hardwoods, and hardwood stands have been estimated to produce 10 cubic
feet per acre per year, except in the Clay Belt and the Kenora extension of the
Central Divide, where 9 cubic feet is the figure used.
The above figures are roughly one-third of the average applied to Swedish
forests, and less than one-quarter of that taken from German forests.
Applying the above figures, I find that an annual cut properly distributed
over our Crown lands could amount to 391,800,000 cubic feet of conifers and
247,100,000 cubic feet of hardwoods.
Assuming 25 per cent of the above conifer cut would be suitable for sawlogs,
and 15,000,000 cubic feet suitable for ties and poles, we could produce annually
the following:
540,000,000 f.b.m. lumber,
2.000,000 ties,
250,000 poles,
3,200,000 cords of pulpwood or other products.
Assuming I 5 per cent of all hardwoods would be suitable for lumber, we
could produce the following annually:
185,000.000 f.b.m. lumber.
10,000,000 cubic feet veneer-logs, poles, ties, etc.
1,500,000 cords of pulpwood,
770,000 cords of fuelwood and other products.
In addition to the above, there are now roughly 41,000,000 f.b.m. of lumber
and 180,000 cords of pulpwood produced annually on private lands and this
could be stepped up to 1 10,000,000 f.b.m. and 300,000 cords, if the plans sug-
gested are carried out.
f 191 1
Recapitulatio
N
(1) (2)
Present Production Possible
(average) annual
Crown lands and cut
private lands (1950)
Lumber 600,000,000 feet board 835,000,000 feet board
measure measure
Pulpwood . . 2,1 80,000 cords 5,000,000 cords
Ties 1 ,500.000 pieces 2, 0000,000 + pieces
Poles 125,000 pieces 250.000 + pieces
Veneer-logs, etc. . . 4,000,000 cubic feet 10,000,000 cubic feet
Fuelwood 1 ,885,000 cords 2,500,000 +cords
Tremendous overcutting of firewood is occurring on Ontario's private wood-
lots; if they are not to be more or less completely ruined, most of the fuelwood
used in the next few decades must come from Crown lands, sawmill waste, etc.
As indicated in Chapter VI on Private Lands, a continually increasing
quantity of wood from that source is feasible and this, added to the increased
cuts later possible on Crown lands as a result of better cutting methods, will
provide a substantial addition to the figures in column (2) above.
The possibilities outlined above, together with the human values which may
be perpetuated and enhanced as a result of adopting the proposed scheme of
management and operation of Crown lands are, I believe, too great to be pushed
aside because of selfish considerations. Perpetuation and improvement of our
forests, together with their dependent industries and all the secondary benefits
of tourist attraction, recreation, control of stream flow, maintenance of water
levels, increase in fish and wildlife, are all within our grasp if we have the courage
to reach out and seize them.
I maintain that this proposal is not visionary. It is practical and based
on sound principles and common sense. To those who are well satisfied with
forestry matters as they are, it may come as a shock. I believe that such people
need a shock. After an exhaustive study of prevailing forest conditions, I am
convinced that it is necessary to protect a probable majority of operators against
their own folly in wasting forest resources which are the life blood of their in-
dustries. I therefore recommend that the principles, if not the details,
be adopted.
192
APPENDIX A— IDENTIFICATION OF SUBMISSIONS
The following is a list of the briefs presented before the Commission:
Name Address Read by
Ontario Provincial Government Departments
Department of Lands and Forests Toronto
Deputy Minister (F. A. MacDougall) J- F. Sharpe
Accounts, Division of
General J- G. McMillen
Timber Acconnts P. B. McLaughlin
Land Tax Geo. Hinton
Air Service, Division of G. E. Ponsford
Fish and Wildlife, Division of Dr. W. J. K. Harkness
H. H. MacKay
L. L. Snyder
Prof. A. F. Coventry
Forest Protection, Division of T. E. Mackey
Land and Recreational Areas, Division of F. J. Sullivan
Law, Division of F. J. Sullivan
Operation, and Personnel, Division of P. O. Rhynas
Reforestation, Division of F.J. Zavitz
Tree Seed Ejctracting Plant R. W. Carman
County Forests A. B. Wheatley
Farm Woodlots L C. Marritt
Research, Division of R. N. Johnston
Forest Regeneration A. P. Leslie
Soil Survey G. A. Hills
Surveys and Engineering, Division of F. W. Beatty
Timber Management, Division of J- F. Sharpe
Department of Planning and Development Toronto A. H. Richardson
Federal Government Departments
Department of Agriculture (Science Service, Division
of Botany and Plant Pathology) Ottawa A. W. McCallum
Department of Agriculture (Science Service, Division
of Entomology) Ottawa Dr. M. L. Prebble
Department of Mines and Resources
Dominion Forest Service Ottawa D. A. Macdonald
Forest Products Laboratories Ottawa T. A. McElhanney
Forest Insects Control Board Ottawa E. J. Menard
National Research Council (Subcommittee on Forest
Tree Breeding) Ottawa J- L. Farrer
Cities, Towns, Municipalities and Counties
Fort Frances, Mayor of Town of Fort Frances. . ^
Geraldton, Corporation of Town of Geraldton W. F. Draper
Haliburton, Provisional County of Minden Mr. Rogers
Halton County Milton ^
London, Corporation of City of London Mayor F. G. McAllister
Mining Municipalities of Northern Ontario, Associa-
tion of South Porcupine. V. H. Evans
Peterborough County Council Peterborough . M. H. Johnston
Port Arthur, City of Port Arthur Mayor C. W. Cox
Renfrew County Council, Reforestation Committee of Pembroke H. J. Chapeskie
Waterloo County Council Waterloo County Mr. Huehn
Boards of Trade and Chambers of Commerce
Alexandria Board of Trade Alexandria D. A. McDonald
Eastern Ontario Associated Board of Trade and
Chambers of Commerce D. A. McDonald
Port Arthur Chamber of Commerce Port Arthur G. H. Young
Port Arthur Junior Chamber of Commerce Port Arthur ... K. Dennis
Sault Ste. Marie Board of Trade Sault Ste. Marie. H. N. Anderson
Smiths Falls Chamber of Commerce Smiths Falls D. A. McDonald
[1931
Name Address
Political Groups
Co-operative Commonwealth Federation (C.C.F.),
Ontario Section of the
Brief Toronto
Supplementary Brief Toronto.
Labour-Progressive Party, Ontario Committee Toronto
Read bv
F. O. Robinson
C. L. Coburn
R. Stevenson
Public Utilities
Bell Telephone Co. of Canada Montreal H. F. Bush
Canadian National Railways, Tie and Timber Depart-
ment Montreal l
Canadian Pacific Railway Company, Purchasing De-
partment Montreal L. E. Peever
City of Port Arthur, Public Utilities Commission Port Arthur R. B. Chandler
The Hydro-Electric Power Commission of Ontario. . . Toronto Dr. O. Holden
Trade Associations and Trades Unions
Canadian Lumbermen's Association
Canadian Manufacturers' Association, Ontario Divi-
sion
Canadian Pulp and Paper Association
Brief
Supplementary Brief
Fort William Trades and Labour Council
Furniture Manufacturers' Association
International Brotherhood Pulp, Sulphite and Paper
Mills Workers CLocal No. 92)
Lumber and Sawmill Workers' Union No. 2995
Ontario Forest Industries Association
Ontario Mining Association
Ottawa Retail Lumber Dealers Association
Wholesale Lumber Dealers Association Inc
Ottawa W. J. LeClair
Toronto Thomas E. Boyce
Montreal R. M. Fowler
Montreal '
Fort William. ... J. Currie
Toronto C. V. Fessenden
Fort Frances ... T. A. Gladu
Timmins B. A. H. Magnuson
Toronto C. R. Mills
Toronto N. F. Parkinson
Ottawa P. T. Davis
Toronto H. J. Luck
Conservation, Recreation, and Professional Associations
Canadian Forestry Association Inc
Canadian Society of Forest Engineers
Northern Ontario Section
Northwestern Ontario Section
Ottawa Valley Section
Southern Ontario Section
Federation of Ontario Naturalists
Hunting and Field Archers of Ontario
Men of Trees
Ontario Conservation and Reforestation Association
1 Brief
4 Briefs
Ontario Federation of Anglers and Hunters
Ontario Horticultural Association
Parks and Recreation Association of Canada
Thunder Bay District Fish and Game Association
Toronto Anglers' and Hunters' Association, Inc.. .
Montreal Robson Black
Kapuskasing . . E. Bonner
Port Arthur EH. Reeves
Ottawa W. M. Robertson
Toronto Mr. Thompson
Toronto Prof T. F. Mcllwraith
Toronto R. J Mitchele
Toronto '
London Watson Porter
Ottawa JH. S. Arkell
\T. A. Dolan
Toronto Dr. A. B. James
Guelph J- E. Carter
Niagara Falls . . J. Pearson
Fort William. ... '
Toronto F. H. Kortright
Educational Bodies
Ontario Agricultural College, Department of Soils . Guelph Dr. G. N. Ruhnke
Sault Ste. Marie Board of Education Sault Ste. Marie. .1. S. Foulds
University of Toronto, Faculty of Forestry (3 Briefs) Toronto Dean G. G. Cosens
Prof. T. W. Dwight
R. C. Hosie
Agricultural Organizations
Cedar Hill (S.S. No. 8) Farm Forum Cedar Hill ... S. Fulton
Lanark County Federation of Agriculture A. E. Blair
[1941
Name
Address
Read bv
Miscellaneous Organizations
Lumber and Pulpwood Operators and Producers of
other Forest Products of Cochrane Area Cochrane A. E. Wicks
Northern Outfitters' Association Sudbury J. A. MacNab
Ontario Command, Canadian Legion B.E.S.L. (2
Briefs) Toronto W. T. Burke
Quetico-Superior Council MinneapoHs,
Minn E. C. Oberholtzer
RehabiUtation Council of City of Owen Sound (3
Briefs) Owen Sound . . Dr. N. Douglas
Toronto Convention and Tourist Association Toronto T. H. R. McNally
Corporations other than Public Utilities
Canadian Splint and Lumber Corp. Ltd
Consolidated Paper Corp. Ltd
Dominion Cellulose Limited and National Cellulose
Company Limited
Eddy Company, E. B
Hammermill Paper Company
Hard Rock Gold Mines Limited
Howard Smith Paper Mills Ltd
Kemp Edwards Ltd., D
Little Long Lac Gold Mines Limited
MacLeod-Cockshutt Gold Mines Limited
Magnet Consolidated Gold Mines Limited
Marathon Paper Mills of Canada Ltd
Milne & Sons Limited, William
Mountjoy Timber Co. L.imited
Newaygo Timber Co. Limited
Northern Paper Mills Ltd
Northern Wood Preservers Ltd
Pembroke Shook Mills Ltd
Pigeon Timber Co., Ltd. and Great Lakes Lumber and
Shipping Ltd. (Brief and Supplementary Brief) .
Pulpwood Supply Co
Twelve Producing Gold Mines in Kirkland Lake and
Larder Lake Area
Upper Ottawa Improvement Co. Ltd
Whitmore Lumber Co., W. N
Pembroke
Pembroke
W. R. BeattyS
W. R. BeattyS
Toronto W. S. Gibson
Hull, Que J. W. Paterson
Erie, Penn M. Cochran
Geraldton A. E. Cave*
Montreal 1
Ottawa 1
Geraldton A. E. Cave^
Geraldton A. E. Cave^
Geraldton
. A. E. CaveS
Marathon
H. P. Klinestiver
North Bay ...
D. W. Milne
Timmins
J. A. K. Reid
Port Arthur . .
. H. S. Mosher
Green Bay, Wis.
A. K. McNaughton
Port Arthur
R. J. Prettie
Pembroke
W. R. BeattyS
Fort William ... E. E. Johnson
Long Lac A. F. Buell
Kirkland Lake A. Harris
Ottawa D. A. Gillies
Deux Rivieres. '
H. N. Bawden
D. A. Clark
C. W. Cox
T. L. Crossley
W. Dennison
Individuals
Avery, B. F Espanola
Bawden, H. N Toronto
Clark. Donald A Port Arthur .
Cox, Charles W Port Arthur
Crossley, T. Linsey Toronto
Dennison. William Toronto
Dexter, J. M Burritts Rapids
Douglas, Thomas O London T. O. Douglas
Eckardt, Dr. B. C London Dr. B. C. Eckardt
Gillies, J. D Newbury J. D. Gillies
Gowan. J. E Geraldton J. E. Gowan
Hambleton, Jack Toronto '
Hipel. N. O Preston NO. Hipel
Irwin, John C. W. (2 Briefs) Toronto J. C. W. Irwin
Kaulbeck, O. A Port Arthur O. A. Kaulbeck
Langstaff, A. R Spencerville 2
Larson, R. H. (Fort Frances "Times" Ltd.) Fort Frances R. H. Larson
Lehtinen, O Fort William O. Lehtinen
Moran, Frank B. (Brief and Supplement) Port Arthur F. R. Moran
Newton-White. E Charlton Station J. C. W. Irwin
Omejer, Major Odegard (Norwegian Consul) Toronto l
Smith, James B Toronto IB. Smith
Start. WD Kenora W. D. Start
^Brief not read by a sponsor at a public hearing of the Commission.
Brief read into the record by the Counsel for the Commission.
Read on behalf of several joint sponsors.
[195 1
Letters were received from the following individuals:
Devitt, A. W Kitchener
Ekman, Carl M Winnipeg
Foley, Gerald R., and Grier, Kenneth S Lansdowne
Henderson, A. B Brockville
Henderson, Miss Mary Jane Montreal
Hesman, Walter Golden Valley
Hickling, Mrs. Jessie Yearley
Hope, Mrs. George (Unknown)
Howard, Rev, A. L Meaford
Kingscote, A. A Guelph
Knapp, Harold Maberley
McDougall, Lome Belleville Chamber of Commerce
Reeves, E. H Toronto
APPENDIX B— IDENTIFICATION OF WITNESSES
In addition to those presenting briefs, the following individuals presented verbal testimony
before the Commission:
Acheson, Keith
Addison, P.
Amidon, Geo.
Anderson, Mr.
Avery, B. F.
Backus, John
Baird F. F. (Dr.)
Baldwin, Geo.
Ballantyne, J. P. S.
Banner, F. L.
Barker, Mel
Barker, Roy
Beck, Mr.
Bertrand, J. P.
Blackburn, F. A.
Brien, W. H. C.
Brodie, J. A.
Bruce, Lloyd
Calder, Ross
Caldwell, J. B.
Cameron, D. Roy
Campbell, C. B.
Case, Mr.
Clark, E. J.
Davis, Clark
Delahey, Geo.
Delahey, W. A.
Docker, W. M.
Douglas, Robert T.
Durrell, W. J.
Faber, Mr.
Fenwick, A. L.
Fiskar, U. W.
Fulton, John S.
Gardner, F. G.
Gimby, W. E.
Godwin, Gordon
Greenwood, W. B.
Haight, H.
Hambleton, J.
Harvey, G.I.
Headley, Mr.
Hesman, Walter
Hilborn, P. R.
Holmes, A. A.
Hughes, H. R.
Irwin, C. H.
James, Thos. J.
Johnson, R. E. L.
Kensit, N. M.
Lahti, J. L.
Larose, Ferdinand
Lee, Roger
Lemay, P. V.
Lenz, Major W. E.
Lewis, Mayor Stanley
Little, Walter
Lloyd, Mr.
Lowe, E. H.
MacDonald, Fred R.
MacQuarrie, E. M.
McAllen, C. J.
McCulloueh, G. A.
McGonigal, G. 1.
McManus, J. J.
McMillan, N.
Mallory, A. D.
Marsden, S. E. P.
Meyers, G. F.
Morison, M. B.
Mulloy, G. A.
Newman, F. S.
O'Mara, P. J.
Pennock, J. D.
Pepler, W. A. E.
Perdue, I. G.
Porter, Watson
Rathwell, M.
Read, A. P.
Reeves, E. H.
Reise, Fred
Ross, K. G.
Sawyer, O. E.
Secord, Dr.
Shaw, Geo.
Sherrett, J. A.
Sintzel, F. C.
Snider, F. E.
Steele. W. E.
Stewart, Milton
Thurston, Willard
Walkinshaw, C. A.
Ward, D. H.
Ward. E. L.
Wardrope, G. C.
Welsby, G. H.
Whitmore, W. H.
Woodman, F. W.
Young, C. B.
Zavitz, C. H.
96
lOYAL COMMISSION ON FORESTRY
Map No. 2
RTION OF WASTE LAND
IN
3UTHERN ONTARIO
i & i S
i — a a 4l
i%-9%
I0%-I9% 20%.«%
509i-l007»
QUEBEC
ONTARIO ROYAL COMMISSION ON FORESTRY
Map No. 2
PROPORTION OF WASTE LAND
IN
SOUTHERN ONTARIO
m,.*7, sa-ta io%.i<k »r.«r. !o«.in«
ONTARIO
REPORT
of the
ONTARIO ROYAL
COMMISSION ON MILK
1947
ERRATA
On page 114 of Report Proper, delete "and" in
last line, bottom of page.
TORONTO
Printed and Published by Baptist Johnston, Printer to the King's Most Excellent Majesty
1947
Copy of an Order-in-Council approved by The Honourable the Lieutenant-
Governor, dated the 1st day of October. A.D. 1946.
Lpon the recommendation of the Honourable the Prime Minister, the
Committee of Council advise that pursuant to the provisions of The Public
Equiries Act, R.S.O., 1937, Chapter 19, the HONOURABLE DALTON C.
WELLS, a Justice of the Supreme Court of Ontario be appointed a Com-
missioner to enquire into and report upon
(a) the producing, processing, distributing, transporting and marketing
of milk including whole milk and such products of milk as are supplied,
processed, distributed or sold in any form; the costs, prices, price-spreads,
trade practices, methods of financing, management, grading, policies and
any other matter relating to any of them but not as to restrict the generality
of the foregoing, the effect thereon of any subsidies or taxes paid or imposed.
(b) the scheme contemplated by the provisions of The Milk Control Act,
R.S.O., 1937, Chapter 76 as amended, and the administration thereof by the
Milk Control Board.
The Committee further advise that the said Commissioner shall have the
power of summoning any person, and of requiring him to give evidence
on oath, and to produce such documents and things as the Commissioner
deems requisite for the full investigation of the matters in which he is
appointed to examine.
Certified, C. W. BULMER,
Clerk. Executive Council.
TABLE OF CONTENTS
PAGE
CHAPTER 1 — Summary of Findings, Recommendations and Suggestions i-xv
CHAPTER 2— Introduction and Procedure 1-2
The Product Itself 1
Procedure Adopted in Respect to the Enquiry 1
CHAPTER 3— Milk Control Board 3-23
Origin of Legislation 3
Composition of Board and General Policy 5
Administration of the M ilk Control Act by the Board 7
The Judicial Functions of the Board 8
The Administrative Functions of the Board 11
Licensing from the Administrative Side 12
Consumer Representation 13
General Problems of Administration 13
Price Fixing 16
Economies in Trade Practices 17
General Opinions and Conclusions 18
Essential Statistical Data 21
Consumer Representation 22
CHAPTER 4 — Legislation Peculiarly Applicable to the Dairy Industry in
Ontario 24-28
Dominion Legislation 24
Province of Ontario Legislation 25
( 1) Cheese Manufacture 25
(2) Public Health 25
(3) Transportation 26
(4) Marketing 26
Municipal Legislation 27
Organization of the Dairy Industry in Ontario 27
(1) Producers 28
(2) Distributors and Manufacturers 28
CHAPTER 5— Production and the Position of the Producer 29-70
The Organization of the Producer's Part of the Dairy Industry in
Canada 29
The Producers 31
Factors Affecting the Cost of Production 33
Milk Production Costs, their Calculation and use 37
Methods of Determining Cost 38
Possibilities of Further Cost Reduction 42
Use of Cost Information in Price Determination 46
General Conditions under which fluid milk is sold 47
Sale on the Butter-fat basis 47
The Quota System 50
Findings in Respect of Milk Production Costs 51
The Testing of Wliole Milk 57
Surplus Milk 59
Maintenance of Controls for the Benefit of the Producer 63
New York State Milk Marketing Scheme 65
Current Price Recommendations 66
Marketing Schemes 67
TABLE OF CONTENTS— Continued
PAGE
CHAPTER 6— Transportation of Fluid Milk 71-81
General 71
Legislation and Regulation 71
Organized Markets 72
Transporter 72
The Producer 76
The Distributor 76
The Consumer 77
Equipment and Methods 77
Summary .- 78
CHAPTER 7— Distribution and the Position of the Distributor 82-113
Licensing 82
Position of Distributor in the Industry 83
The Regular Distributors 84
Developments in Respect of Pricing 85
Competition in Industry 87
Distributor's Spread in Fluid Milk Sales 87
Cost of Processing and Distributing a Quart of Milk 90
Necessity of Decreasing Costs and Narrowing Spreads 92
Methods of Decreasing Costs and Narrowing the Spread 93
Depot Deliveries 95
Every other Day Delivery 96
Co-operative Delivery by Distributors 97
Zoning 97
Quantity Discounts 97
Trade Reaction 98
The Financial Position of the Distributors Generally 98
Capital Employed 99
Wage and Labour Costs 102
Combined Operations 102
Subsidies 103
Other General Considerations 104
Tendencies to Monopoly 104
Fixation of Consumer Prices 106
Conclusions on Price 110
Financial Assistance to Aid Consumption Ill
CHAPTER 8 — Examination of F.uid Milk Price Increase of October 1st,
1946 114-116
CHAPTER 9 — Consumption and the Position of the Consumers 117-122
General Il7
Co-operatives Il9
Milk as a Public Utility 120
Summary 122
CHAPTER 10— Cheese Production and the Position of the Cheese Producers. 123-132
Cheese Factories 123
Cheese Boards 124
Average Costs of Producing Milk for Cheese 126
Volume of Producers Association Cheese Purchases and Sales 12
o
Consolidation of Factories 12
Summary 13
TABLE OF CONTENTS— Continued
PAGE
CHAPTER 1 1 — Cream Producers, Creameries and Butter Production 133-140
Cream Producers 133
Quality of Product 134
Methods of Production 135
Waste in Transportation 135
Waste Creamery Capacity 137
Insuring Maximum Competitive Price 137
Creameries • 137
Plant Capacity and \'olume of Production 138
Consolidation 139
Single and Multiple Operations 139
Cost and Profit Position 139
Summary 140
CHAPTER 12 — The Concentrated Producers and Manufacturers of Concen-
trated Milk and Their Position 141-146
Producers and Their Cost Position 141
Average Costs of Production of Milk for Concentration 142
The Transportation Problem 143
Price Fixing to Producers 143
Marketing Scheme 144
Consumer Prices, Profits, etc 144
Manufacturers 145
CHAPTER 13 — General Conclusions and Recommendations 147-154
Recommendations with Respect to the Milk Control Act and Board. . . 148
Recommendations with Respect to Producers 149
Recommendations with Respect to Transportation 150
Recommendations with Respect to Distribution 151
Recommendations with Respect to Consumers 151
Recommendations with Respect to Cheese Producers 152
Recommendations with Respect to Cream Producers and Creameries. . 152
Recommendations with Respect to the Condensaries 153
Acknowledgments 153
GENERAL INDEX 155-157
INDEX TO APPENDICES 161
Report of the Royal Commission on Milk
Province of Ontario
To his Hon-our the Lieutenant-Governor in Council:
May it please your Honour: By terms of reference approved by your
Honour in Council on the 1st of October 1946 I was appointed a Commis-
sioner to inquire into and report upon:
(a) The producing, processing, distributing, transporting and marketing
of milk including whole milk and such products of milk as are
supplied, processed, distributed or sold in any form; the costs, prices,
price-spreads, trade practices, methods of financing, management,
grading, policies and any other matter relating to any of them but
not as to restrict the generality of the foregoing, the effect thereon of
subsidies or taxes paid or imposed.
(b) The scheme contemplated by the provisions of The Milk Control
Act, R.S.O., 1937. Chapter 76 as amended, and the administration
thereof by the Milk Control Board.
By a further Order-in-Council on the 24th of October 1946, I was afforded
the services of Mr. Beverley Matthews, C.B.E., K.C., as Counsel, Mr. Donald
A. Keith, M.B.E.. Barrister-at-Law, as Secretary. Professor William M.
Drummond, M.A., as Economic Consultant, and Mr. John S. Entwistle, C.P.A.,
as Accountant, in conducting the enquiry.
I beg to report the result of the enquiry as follows:
The report is prefaced in Chapter 1 by a summary of the findings, recom-
mendations and suggestions, but only the more important aspects of the
matters investigated are touched upon in that summary.
The bases of these findings and a fuller statement of the facts elicited
by the enquiry are set out at greater length in the text. In reaching these
findings, I have had the most generous assistance and counsel from the
gentlemen appointed to assist me. Responsibility for the ultimate findings
and conclusions, however, must rest on me.
The sources of information and the procedure followed are indicated in
Chapter 2. A list of the witnesses and all public bodies, organizations,
associations and individuals making submissions on the enquiry are set
out in Appendix 1.
ONTARIO ROYAL COMMISSION ON MILK
CHAPTER I
Summary of Findings, Recommendations
and Suggestions
The production, distribution and consumption of milk are subjects of
wide-spread interest in the Province of Ontario. Consumption of fluid milk
in this Province has risen from 250,405,000 quarts in 1939 to 467,736,000
quarts in 1946. Nearly 150,000 persons are directly eno;aged in the production,
transportation and distribution of fluid milk, cream, ice-cream, che«se,
butter, concentrated milk and other milk products, in the Province of
Ontario. The total value of milk production in Ontario for the year 1946
was estimated at .$154,981,000. of which fluid milk sales amounted to
approximately $60,500,000. There are approximately 16,000 producers
producing milk for fluid consumption, 76,000 producers producing cream
for butter, 23,500 producing milk for cheese, and an additional 14,000 pro-
ducing milk for the manufacture of concentrated products. It is also esti-
mated that there are approximately 20,000 persons engaged in the pro-
cessing, transporting and distribution of milk and other dairy products.
As to the importance of milk itself. Dr. F. F. Tisdall, of Toronto, an
eminent authority on nutrition, stated before me that from his studies in
connection with nutrition, his respect for milk as an article of diet con-
tinually increased. In his opinion no other single food contained so many
nutrients essential to life.
In making this enquiry hearings were held throughout the Province so
that all factors affecting the problem received proper consideration. Sittings
were held at Port Arthur, Fort William. North Bay, Belleville, Ottawa,
Hamilton, London, Windsor and Toronto. Forty-two days were consumed
in taking evidence, some 67 briefs were submitted and 154 witnesses
examined. The evidence extends to some 5,681 pages. Of the witnesses
examined, 29 witnesses represented distributors, 70 witnesses represented
producers and some 39 witnesses were consumers or represented consumers.
The Mayors of the Cities of Toronto and Hamilton gave evidence and the
City Solicitors of Ottawa and Windsor appeared on behalf of their respective
municipalities. Some six witnesses appeared for those transporting milk
and twelve experts were heard on subjects ranging from applicable legisla-
tion to problems of nutrition. The only major group who failed to make
representations to the Commission or to assist it voluntarily were those
manufacturing concentrated milk products. At my instance an examination
of their operations was made through accounting studies.
THE MILK CONTROL BOARD
The second matter referred to me, that is the administration and operation
of the Milk Control Act through the Milk Control Board, is considered first in
this Report. In 1934 the Ontario Milk Control Board, created by the Milk
Control Act of 1934, set to work to stabilize prices, both to the producer
and to the consumer, at levels which it was considered could be held, and
which would prevent the bankruptcy of the farmer. Prior to this the whole
price structure of the industry had collapsed, due to the depression, and
li ONTARIO ROYAL COMMISSION ON MILK
the industry, in Ontario as elsewhere, was in a chaotic condition. The
Board, wherever possible, achieved these purposes by obtaining agreements
between producers and distributors. Existing processing and distributing
plants were licensed. It Was considered that the number of distributors
at that time was excessive, and new candidates for entry into the business
were refused permission except where, in the Boards opinion, public
necessity clearly required them.
There is no doubt in my mind, and I think it is amply supported by the
evidence, that the over-riding factor in setting the policy of the Milk Control
Board, from its inception to date, has been the welfare of the dairy industry
as a whole, in the belief that therebv. as a sort of necessary corollary, the
general public interest was best being served. The Board has functioned
along limited lines and, in effect, has attempted to let the industry rationalize
itself. No effective pressure was brought to initiate needed economies or
more rational methods of distribution until certain improvements were
effected under pressure of wartime conditions in 1942. It is an amazing fact,
but apparentlv true, that at no time in exercising its functions has the Milk
Control Board had a really adequate knowledge of either producer oi
distributor costs, nor could it possibly have had such knowledge with the
staff available.
I think that the emergency which warranted this policv has long since
passed, and that another factor, quite apart from the vague general public
interest previously regarded, deserves definite attention. — namely the interest
of the actual consumer of milk. Sanitary standards, compulsory pasteuriza-
tion, standard products and other things, have combined to make a very high
quality product available to the consuming public of Ontario daily. I feel
that the same attention to securing confidence in the price charged for
these products would greatly assist in maintaining and increasing levels
of consumption.
The Milk Control Board, by virtue of the terms of the Act. has been
called on to perform two conflicting functions, the one administrative and
the other judicial, in respect to licensing. In my opinion the judicial
function has not been performed judiciallv but has been governed by the
over-all administrative policy of the Board. Administrative objectives seem
to have been the governing factor and to have coloured the Board's inter-
pretation of the terms of the Act and its application to individual applicants.
A more effective division of these functions would seem desirable.
Price- fixing:
With respect to price-fixing, until such time as an effective producer
organized marketing scheme can be developed, the evidence has convinced
me that some responsible authority must fix and enforce the price to be paid
to the primary producer for milk to be used for the fluid market and for
concentration.
Such authority must have an adequate knowledge of costs of production
and statistics with respect to general business levels, and price and wage
indices. I have come to the conclusion that the Milk Control Board should
be in a position intelligently to set such prices by arbitration, or failing this,
be able to advise the Government as to a proper price structure. Up to the
present time the Milk Control Board, because of its lack of essential statis-
tical data, does not appear to have been in this position.
At the consumer level, I am convinced that distributors must be compelled
to compete on price. An over-riding authority should be vested in the
Board to fix prices if competition shows undesirable results.
ONTARIO ROYAL COMMISSION ON MILK 111
Under the administration of the Board the product has been standardized
a? to quality, competition as to price has been eliminated, and the only
competition left between the various distributors is as to services. In my
view this is a most wasteful and expensive form of competition.
Consumer Representation on Milk Control Board:
Labour as a group, and numerous consumer witnesses, represented that
each should have representation on the Board, to speak for special interests.
There would seem to be no limit to representation of this kind, and in my
view, appointment to the Board should be based on ability to perform the
work required, not representative interest. It appears that Consumer Repre-
sentatives appointed specially bv municipalities have not been able to get
essential information. The Board should amend its administrative practice
to conform to the provisions of the Milk Control Act, and invariably provide
such information.
PRODUCTION AND THE POSITION OF THE PRODUCER
Many producers, not only for the fluid trade but also for cheese-making,
concentrated milk production and for butter-making, appeared before me
as witnesses. The high standard of these representative Ontario farmers
could not help but be specially noted. Almost without exception, however,
producers were concerned with the cost of their product regardless of
demand, and with the apparent disparity between farm prices and costs of
production. When it is realized that only approximately a quarter of the
milk produced in Ontario is utilized for fluid consumption and commands
the maximum price, it will be readily understood that the farmer always
faces a market in which the purchaser has the advantage. Surplus milk
sells at approximately SI. 00 per hundredweight less than milk for fluid
consumption. Surplus prices really govern the average net return to the
producer. The only ultimate and really satisfactory solution for the producers
is the development of a comprehensive marketing scheme and of methods
of manufacturing or disposing of surplus milk. Until they can do this
they will have to rely on such protection as the Milk Control Board and
Provincial Authority can furnish to maintain a stabilized price structure.
Despite the development of the organization of the fluid milk producers
in the Ontario Whole Milk Producers' League, that organization is not yet
strong enough, in my opinion, to eff^ectively protect the producers' position
as against the distributor, particularly under conditions of decreasing demand.
I doubt also that the rank and file of its members have as yet recognized
the necessity of seeking their own salvation through an effective marketing
organization.
The producers established that in no case were they getting their cost
of production plus even a reasonable administrative allowance. In view,
however, of the decreased consumption since the price increases of October,
1946, it would not seem economically possible for the producers to obtain
more for milk sold for fluid consumption than is presently being paid them.
Factors aff^ecting the costs of production are discussed in considerable
detail in the report. The key, however, to an adequate return to the
farmer-producer is not only in his obtaining his costs for fluid milk, but
also in a proper disposition of his surplus milk at adequate prices. At the
present time it is quite clear, from the evidence, that the producers as a
iv ONTARIO ROYAL COMMISSION ON MILK
whole do not know their own costs of production. Various methods for
establishing these are discussed in the Report.
While blended prices for all milk are paid in other jurisdictions, with
certain appropriate premiums for quality as, for example, in Great Britain
and New York State, this solution of the producer's problem of getting
a reasonable return for his milk has not yet reached the position in
Ontario where it can be deemed to have much practical value. There is no
substantial producer opinion to support it.
As standards of farm life and income rise, no doubt, it will be found
progressively easier to accomplish improvements in herd management and
volume of production. While these, by comparison with other countries,
cannot be said to be unsatisfactory, the twin goals will always demand
serious attention and effort, by producers and government jointly.
In view of the apparent necessity for governmental protection, a corre-
sponding duty devolves on the producers to pursue the study of ways and
means to cut costs of production, in order that the ultimate consumer be
not penalized. Many producers already recognize this.
Problems affecting the producer, such as the butter-fat test, the quota
system, the necessity of the maintenance of present controls and. in my
view, the ultimate necessity of the creation of some effective marketing
scheme, are dealt with in detail in the Report.
TRANSPORTATION OF FLUID MILK
The transporters as a class are at the moment the agents of the farmer in
most cases, to carry his product to its market. With the farmer as the
principal, it has seemed impossible to eliminate waste and duplication of
service. There is no doubt that the Transporter under the present system
has done the work effectively but, I feel, at a price which is not warranted.
In the case of a vital food the consumer cannot be asked to pay to maintain
an inefficient system. Unless the Transporters can themselves agree on a
method of eliminating waste and duplication, appropriate economic pressures
would appear to be in order. If. by fixing the price of fluid milk at the
farm rather than the dairy, the Transporter became the employee of the
distributor, and the distributor in turn were forced to compete with respect to
price, the high cost of duplication of service and waste mileage would quickly
become apparent, and I feel would in time be eliminated. The excessive
cost of transporting milk would seem to be a factor in the price to the
consumer which has received little consideration or attention.
DISTRIBUTION AND THE POSITION OF THE DISTRIBUTOR
In this Province, as a result of high standards of quality and fixed prices
to producer and consumer, the Distributor has been forced to compete for
volume in the service he provides to his customers. A very representative
number of distributors appeared before me during the course of this enquiry
and five things stand out in mind, as a result of the whole volume of their
evidence, namely —
(a) The distributor operates on a very narrow margin of profit per unit.
Generally speaking, profits lie in volume of distribution and diversi-
fication of product. A fractional loss per unit can quickly create a
large loss.
(b) A distributor who maintains the quality of his product, who keeps
his business diversified and upholds a high standard of service, will,
ONTARIO ROYAL COMMISSION ON MILK V
if operating efficiently for the volume of his business, show a profit
at present prices. Under present conditions such profit will be some-
thing less than one cent a quart. It would appear that the profits
of the distributors are not unreasonable in amount when considered
on a unit basis, but the key to cheaper milk would seem to lie in
lowering distribution costs which, at the present time, approximate
25 per cent of the cost of a quart of milk.
(c) Every distributor is aware that certain changes in methods of distri-
bution would result in some economies; for example, every-other-day
deliveries, different types of containers, depot sales and others.
(d) No distributor is prepared to initiate any radical change in what the
consumer has been educated to expect in the way of service, when he
is prevented from offsetting any initial dissatisfaction with a change,
by offering the consumer the benefit of any saving made by reducing
the price. Economical changes made must at present be unanimously
adopted by all distributors in any market at the same time. This,
obviously, discourages, if not entirely obviates, reduction in dis-
tributive costs.
(e) There is no real difference between the product of one distributor
and that of his competitor.
One other primary factor which dominates the whole of the distributive
industry in the Province of Ontario is that the Borden Company Limited,
Silverwoods Dairy Limited, and Dominion Dairies Limited, handle between
them approximately 30 per cent of the dollar value of fluid milk distributed
in the Province of Ontario and 40 per cent of all products handled by
distributors. A further fifty-five companies handle an additional 18 per
cent of total sales and, on examination of the financial records of these
companies, it would appear that, if the law permitted, they could afford to
enter into competition in respect to prices charged to consumers. The great
majority of the remaining distributors, approximately 750 in number, are
operating comparatively small businesses, in many cases in small towns
and villages throughout the Province. It is doubtful that these distributors
can afford any reduction in price at the present time and indeed, if they were
compelled to meet a competitive reduction in price, many of them would be
forced out of business. However, as will be seen from my report, many of
these smaller distributors have a monopoly of the business in the area for
which they are licensed, and I am not convinced that permission to compete
as to price would result in disaster to any considerable number of existing
distributors.
I am satisfied that by and large when milk is sold in the fluid market
the producer is paid for it at the fluid rate. The use of surplus milk, how-
ever, in the case of those distributors who have equipped themselves to handle
it, has been a profitable form of business. This is particularly applicable to
those distributors who sell ice-cream and ice-cream mix. Another hidden
source of profit to distributors is in connection with the price paid for
butter-fat in milk used for the fluid trade. Since December of 1940 any
milk purchased for the fluid trade by a distributor which tests over the
base 3.4% butter-fat, brings a premium to the producer of 3^/^ cents for
each 1/10 of 1% over such base figure. Similarly, a deduction is made from
the standard price of the same amount for each 1/10 of 1% below the base
figure. Prior to December, 1940, this butter-fat differential was a variable
figure depending upon the wholesale price of creamery butter. At the present
time, with creamery butter selling at more than 60 cents per pound to the
VI ONTARIO ROYAL COMMISSION ON MILK
consumer, the value of butter-fat would appear to be nearer to 6 cents
per 1/10 of 1% butter-fat than to the fixed differential of Sy^ cents. Most
of the large distributors standardize their milk for sale to the consumer at
3.4% or 3.5% butter-fat and consequently are able to dispose of excess
butter-fat at present prices at a substantial profit.
I fail to see any justification for this fixed differential.
Mr. Entwistle's study would appear to indicate that prior to the recent
price increases the average spread between the producer price and the price
charged consumers was 5.31 cents. In his opinion this spread was increased
by the price increase of October 1, 1946, to approximately 5.68 cents per
quart. Methods of decreasing cost and narrowing the spread are discussed
at some length in the Report. Under the system of fixed prices to con-
sumers, under which the industry has operated since 1935, there is little
incentive to explore these various methods, although this would seem to be
the only field in which any improvement can be achieved. Reference is
made in the Report to the financial position of the distributors generally,
which is also examined in detail by Mr. Entwistle in his report. The
general situation would appear to be a very healthy one for the industry,
and the increasing volume of sales during the war vears has largely offset
increased cost of distribution resulting from higher wages and other
increased costs. No attempt is made in this summary to express the details
of the present financial situation in the industry, as it is discussed at length
in the Report.
In conclusion it may be stated that it was not established by the enquiry
that milk distribution in Ontario is in any way a monopoly, although the
general dependence on large volume constitutes an inherent tendency leading
in that direction. The grave defect from the consumer's viewpoint would
appear to be the lack of any effective competition, and the remedy for this
would appear to be the removal of a fixed consumer price. Consumer
subsidies such as obtained during the war years are not, in my opinion, a
desirable or effective solution of obtaining lower priced milk under peace-
time conditions. The efficacy of public ownership of methods of distribution
would appear to depend entirely on their efficiency and diversification of
their operation, and in no way offers an immediate prospect of lower price
to the consumer. If any public assistance is to be rendered it should, in
my view, be limited to the supplying of cheaper milk for school children.
EXAMINATION OF THE FLUID MILK PRICE INCREASE
OCTOBER 1st, 1946
Mr. Entwistle, the Accountant attached to the Commission, made a studv
of the price increase at the end of September. 1946. His examination would
indicate that if the price increase had been limited to two cents instead of
three cents the industry as a whole would have shown a loss of $1,806,000
for one year's operation. If the price increase had been 2V2 cents instead
of the three cents which was obtained, a small profit to the industry on an
over-all basis of $344,000 would result. This illustrates in a quite startling
way the very narrow spread on which the industry operates. Nevertheless
in his opinion at least 12 per cent of the distributors, who are responsible
for the distribution of nearly 50 per cent of fluid milk, could have afforded
to limit their price increase to 2l/i> cents per quart instead of three cents.
The result is that where there is no competition as to price, this uniform
increase in price to the consumer gives to these large distributors profits
out of all proportion to those obtained by the smaller operators.
ONTARIO ROYAL COMMISSION ON MILK vii
CHEESE PRODUCTION
Some 25,000 producers in the Province of Ontario regularly supply milk
to cheese factories. The milk going for this purpose in 1945 represented 21.2
per cent of the whole production of milk in this Province. Milk is processed
at some 575 factories, by far the larger majority of which are owned on a
co-operative basis by the producers supplying milk to them. There are a
few large factories owned by Swifts, Kraft, and some other companies, that
manufacture cheese, but they are not large enough in volume to affect the
general situation. In the result, the price realized by the producer for milk
used for the manufacture of Cheddar cheese represents the value of the
finished product less the costs of processing, and since the finished product
must compete on a world market, in view of the very large volume available
for export, it has been found in practice difficult to secure a price which
the producers feel represents a fair rate having regard to the cost of pro-
ducing the milk. The producers themselves, through the medium of a
marketing scheme set up under the Farm Products Marketing Act, have
succeeded in securing the best possible price under existing conditions.
However, there has been very little actual control by the cheese producers of
methods of marketing overseas, although the price thus obtained is the
governing factor in the return to the cheese milk producers. It must be
remembered that the war and post-war period has been abnormal in view
of the over-riding necessity of supplying food to Great Britain and the
consequent absence of a free market. However, there is no doubt that the
cheese producers are strongly organized and able to afford themselves a
considerable measure of protection.
It will be abundantly clear, however, from the detail given in this Report,
that the Ontario cheese producer does suffer from his apparent unwilling-
ness to amalgamate cheese factories with a view to securing a large volume
of production with a minimum capital investment and overhead charges.
This has been drawn forcibly to the attention of the cheese producers and
every step should be taken that is possible to ensure that the number of
cheese factories be reduced and the production per factorv substantially
increased.
Ontario Cheddar cheese holds a very high reputation in the world market
and the Ontario producer should not permit the return for his labours to
he frittered away in inefficient and wasteful methods of processing.
CREAM PRODUCERS
There are upwards of 76,000 producers in the Province of Ontario who
supply cream for the manufacture of butter. There are two significant facts
which have again been brought out by this investigation, namelv, that cream
production is by and large the by-product of other types of farming, and
secondly, that the average production per creamery in the Province of
Ontario is far below that of other provinces, such as Saskatchewan, Manitoba
and Alberta, and a mere fraction of the average production in New
Zealand. The producers have not taken advantage of government assistance
offered to amalgamate creameries with a view of reducing capital and
overhead, and, like the cheese producers have, for the sake of convenience,
been permitting a substantial part of the return from their labour to be lost
through duplication and inefficient methods of processing.
Another very important point which has been established bv the evidence
is the excessive waste and duplication in the transportation of cream from
VIU ONTARIO ROYAL COMMISSION ON MILK
farm to creamery. This must be corrected if the producer is to receive the
maximum possible return for his product.
PRODUCTION OF MILK FOR CONCENTRATION AND THE POSITION
OF THE MANUFACTURERS
Upwards of 14,000 producers supply milk to factories for the making of
condensed and evaporated milk and milk products. The price paid for milk
used for this purpose has been subject to some measure of control and price-
fixing by the Milk Control Board, but since the end-product is to a large
degree exported, and since the Milk Control Board has not been in possession
of sufficient information either to know the costs of production of the
farmer or the result of the distributor's operations, the price-fixing under-
taken has, in my view, lacked a proper basis to justify it. An examination
of the financial returns of companies engaged in the concentration of milk
has been handicapped by the fact that some of the larger concerns are
subsidiaries of British and American companies and full information has
not been available in this Province. Such investigation as has been possible,
however, leads one to the belief that a very high rate of return has been
earned by these companies, some of which could very well have been paid
to the producers. The real remedy lies in the hands of the producers them-
selves, with tlie use of existing facilities for government financial assistance,
namely to follow the example of the Montreal producers and the producers
for the twin cities of Minneapolis and St. Paul and manv others, and to
establish their own factories for the concentration and condensing of milk.
In this way the producer can be assured of receiving the maximum return
for his raw product.
A very significant fact, however, was disclosed as a result of the
Accountant's investigation, namely, that in the case of concentrated milk
products the main source of profit lies in the export trade. Profits from
domestic sales appear to be small. This may have been due to wartime price
control. One major concentrator which has plants in Ontario and Quebec,
seems to find it convenient to use its Quebec production for the export trade
and its Ontario production for domestic trade. This is a factor which may
adversely affect the producer of milk for this purpose in any one province.
With the experience after the first World War as a guide, it should also be
remembered that the large profits in export trade cannot be counted on
indefinitely.
CONSUMPTION AND THE POSITION OF THE CONSUMERS
A considerable number of interested witnesses appeared as consumers, and
while in the very nature of things they could not be expected to have a
detailed knowledge of the dairy industry, at the same time it was obvious
that a substantial body of opinion favoured the introduction of reform?
tending to ensure that the consumer was not left at the mercv of the producer
and distributor. Substantially the consumer's case was pressed on a basis of
need irrespective of price or cost. Many consumer witnesses were in favour
of the payment of subsidies, preferably by the Provincial Government, in
order to keep the consumer price down to a very low level. Those making
such recommendations, however, did so without an adequate appreciation of
the cost of such subsidies if any appreciable reduction was to be made.
Other recommendations, that municipalities be permitted to engage in the
processing and distribution of milk, that co-operatives be permitted to pay
ONTARIO ROYAL COMMISSION ON MILK IX
consumer dividends, and that consumers of large quantities of milk be
given the benefit of something approaching wholesale discounts, appeared
to me to be better supported. On the whole, the consumer position can be
summarized as requiring a recognition that milk is an essential part of
daily diet and that no group, whether producers or distributors, should be
permitted to secure an unreasonable profit in the supplying of such a vital
food. If consumers can be convinced that such is not happening, much of
the controversy as to price may disappear.
The foregoing is intended to be a very brief epitome of the more
important matters disclosed by this investigation. The various points
mentioned and many others are dealt with in detail and at length under
the appropriate chapter headings of this Report, and supported, where
necessary, by the Appendices. No doubt all who have an interest in this
subject will make full reference to the text of the Report and the
Appendices.
The general conclusions and recommendations as expressed in the Report
are reproduced in this summary in their entirety, as it appears to me de-
sirable that those using the summary should have these in full.
GENERAL CONCLUSIONS AND RECOMMENDATIONS
The Milk Control Act was originally passed to relieve a state of crisis
which existed in the production and distribution of fluid milk in the
Province in the year 1934. Methods propounded to meet this crisis have
grown into a species of control maintained long after the emergency has
ceased to exist.
If it were possible to disregard this development, an arrangement where
the producers of milk in this Province were organized in a marketing
authority with power to direct the disposition and use of milk for what-
ever purpose seemed appropriate, would seem the best solution of their
difficulties. As I have suggested, this might well be modelled on the
present British scheme, which is in essence an organization of the pro-
ducers themselves. But as I have previously indicated, the producers as
a class, apart from some such comprehensive organization, are not able
to protect themselves in bargaining with the distributors. If they were, I
would be inclined to the opinion that the full play of competitive forces
would reasonably protect the consumer in respect of distribution and would
in the long run produce a much more economic and better organized system
in the industry as a whole. Practically speaking, however, the producer
organizations are not strong enough at the moment to fend for themselves
alone. No over-all marketing organization of producers exists in the
Province of Ontario. I must deal with the various factors as they exist at
the present time. It would, therefore, seem essential at the present to
maintain the existing controls.
The effect of the operation of the Milk Control Act since 1934 has
been to remove most of those competitive pressures which ordinarily
operate in respect of private business. In doing this, it has not substituted
that full measure of public control which would seem to be the necessary
alternative. In the result, therefore, particularly under inflationary or
semi-inflationary conditions, the consumer has suffered. Instead of having
the benefits of the operation of one principle or the other in the industry,
the general public, in my view, have had some of the worst results of
both. At the present time fluid milk as produced and sold in Ontario is,
for practical purposes, a standard article sold at a fixed price. The only
X ONTARIO ROYAL COMMISSION ON MILK
real measure of competition left among the distributors has been that
competition in services, which is probably the most wasteful and extrava-
gant form of competition that exists. What should be done at the moment
would seem to me to be the taking of necessary measures to reintroduce
some real and effective competition in the distributing end of the industry:
and, for the protection of the producers, to continue the existence of the
Milk Control Board. Its powers, however, should be clarified and enlarged.
Under the present circumstances it is not sufficient to allow the industry
to regulate itself at its own free will. There is an obligation on the Board
to bring pressure to reduce waste and duplication, and to see that the
interests of the three groups which are vitally concerned in the industry,
namely, the producers, the distributors and the consuming public, are each
reasonably protected and considered in a more definite and effective way
than in the past twelve years.
While the earlier period of the Milk Board's operations may be thought
of as an emergency period during which the central objective was to bring
order out of chaos, the time has now arrived when the general objectives
of the Board should be greatly enlarged. The basic reason for its con-
tinued existence must be its success in obtaining increased efficiency
in milk production and marketing.
In respect of the Milk Control Board, therefore, certain specific
recommendations are made herewith; others will appear as incidental
to recommendations made under other heads.
Before making these recommendations, however, there is one other
matter that should be mentioned: Sections 4 and 13 of the Milk Control
Act give the Board various powers. Some doubt has been raised by
the law officers of the Crown as to the power of the Board to fix prices
under these sections. A perusal of the sections undoubtedly affords a
reasonable basis for the doubts expressed. Without expressing an opinion
on the Board's powers under the present statute, it should be pointed
out that it casts a great and, in some measure, unfair responsibility on
government to ask it to fix prices in a private industry, in the general
administration of which it has in effect no decisive voice. The only justifi-
cation for such exercise of authority would appear to be some infringement
of the public interest. Insofar as price fixing is concerned, in the first
instance the basic responsibility for the determination of prices would
seem to rest on the industry itself. If, however, it is impossible for the
parts of the industry to agree, then in dealing with a vital food such as
fluid milk it may be desirable that an administrative authority such as
the Milk Control Board should have the right to arbitrate between the
various interests, and to determine an arbitrated price between the compo-
nent sections. Similarly, if a price arrived at by the industry is against
the public interest, paying attention to the interests of the producers, dis-
tributors and consumers alike, there may be responsibility on government
to intervene in respect of the interest adversely affected. It is desirable
also that the administrative body dealing with the problem should be able
to advise the final authority on a sure basis of knowledge and accurate
information. To date there has been no consistent effort to study the
costs and profits of either the producers or the distributors. For example,
at the time of this Investigation such a fundamental fact as the ratio of
wholesale to retail sales in the distribution of fluid milk was not available
in the records of the Milk Control Board or the statistics branch of the
Department of Agriculture. A sample study had to be made on behalf of
the Commission.
ONTARIO ROYAL COMMISSION ON MILK XI
I therefore recommend, as to price fixing:
(a) That the Milk Control Board commence and continue the collection
and study of representative cost data in respect to producers. De-
tailed suggestions as to how this might be done are contained
in Appendix 28.
(b) That it should also undertake a continuous collection and study
of the cost and profit position of the distributors. It may be that
the powers of the Board under section 15 as at present constituted
are sufficient for this purpose, but if not they should be reconsidered
and clarified.
(c) That such additions to the staff of the Milk Control Board as are
necessary to carry out (a) and (b) be considered.
(d) That sections 4 and 13 of the Milk Control Act be revised to
clearly give the Board authority to arbitrate a price for fluid milk
as between producers and distributors, and in cases of necessity as
between distributors and consumers.
(e) Further, that the power of the Board be made clear to enable il
to ultimately determine a price for fluid milk either to the producers
or to the consumers if the prices obtaining are against the public
interest, as determined by the rights and interests of the pro-
ducers, the distributors and the consumers, with the result that in
practice —
(il The price of fluid milk at the consumer level be not agreed
to or fixed in ordinary circumstances. The power should be
a corrective one only, and
(ii) That prices paid by distributors to producers be fixed or
agreed upon as heretofore and that such prices be ordinarily
fixed on the basis of delivery at the farm unless other methods
are successful in eliminating duplication and excessive cost in
transportation from farm to dairy.
As to Co-operatives —
(f) That section 11 of the Milk Control Act preventing rebates by dis-
tributors to customers, and which in effect prevents the effective
operation of consumer co-operatives, be repealed.
Licensing —
(g) (i) That the administrative and judicial functions of the Board
as to licensing be separated by setting up an Advisory Board
somewhat similar to the Insurance Advisory Board in order
that the judicial functions of the Milk Control Board be
exercised as provided by the statute free from administrative
bias,
(iij That the conditions entitling applicants to licenses be more
explicitly set forth in the Milk Control Act.
Composition of the Board —
(h) At the moment the Board is set up on a representational basis.
Without unduly criticizing the unselfish service that has already
been given to it by those appointed under this system, I am unable
to see much solid advantage in it. I would reconmiend that in
future when appointments to the Board are being considered regard
should be had to the capacity and fitness of the person concerned
rather than to the interest he or she represents.
XU ONTARIO ROYAL COMMISSION ON MILK
Consumer Representation on Milk Control Board — ■
(i) In respect of consumer representation on the Milk Control Board,
as I have said, I do not think that representation of special interests
adds greatly to the strength of such a body. The present provisions
in the Milk Control Act for consumer representation in special
markets, should be continued, but the administrative practices in
respect of them should be changed and the intent of the Act followed
more closely. I would recommend that where a consumer repre-
sentative is accredited to the Board and enters on his duties, he
should be required to take an oath of secrecv and that all the
information available to the Board be completely disclosed to the
consumer representative in respect of the matter under consideration.
Recommendations with Respect to Producers
In respect to the producers, my view is that the ultimate solution of
their difficulties will be found in the setting up of a marketing organization
for all producers. This may not be immediately practicable and, if not, I
would suggest:
(a) That a start be made in organizing the fluid milk producers, and
that the further study and consideration of the entire project be
initiated and pursued with as little delay as possible by the existing
joint committee representing the four sections of milk producers.
In respect of the form of such an organization, attention is again
specifically directed to the British scheme, which would seem to
provide most of the necessary principles upon which to build such
an organization,
(bl That the existing producer organizations, particularlv the Ontario
Whole Milk Producers League, be encouraged themselves to take
steps to process and dispose of fluid milk not required for the fluid
market. In view of Mr. Entwistles study of production prices
paid producers and distributor spreads, a substantial increase
in the price paid to producers for secondary milk would appear
to be justified at the present time without alteration of consumer
prices for the resulting products and such increase might be found
to be as much as 10% more than present prices.
(c) That the regulations of the Milk Control Board assure that pro-
ducer association employees be permitted to check the accuracy
of testing in distributor and processing plants to remove present
suspicion and dissatisfaction regarding the accuracy of these tests.
(d) That the practice of paying price premiums or discounts in
accordance with variations in butter-fat content of the milk be
reviewed to the end that the amounts paid correspond with
current prices for butter-fat. These particular payments should
be subjected to review and, when necessary, revision at monthly
intervals.
(e) That in view of the existing conditions of supply and demand no
further increases in fluid milk prices be granted at the present
time. This recommendation is made in view of the demand situation,
and despite the fact that in the view of the Commission existing
prices do not cover the cost of production plus a reasonable profit
or even a proper administration allowance.
(f) That the present efforts through the Department of Agriculture be
intensified to assist producers in applying the knowledge gained by
research and study to the further improvement of volume and
ONTARIO ROYAL COMMISSION ON MILK Xlll
quality of production and to the further reduction of producers'
costs.
Special Recommendations in Respect to Transportation
It is obvious from a perusal of the discussion of Transportation in this
Report that I regard the present system as uneconomic and wasteful. Ideally,
I think it would be desirable to fix the price of milk at the farm and
allow normal competitive pressures on the distributors to lead them to
rationalize their methods and costs of collection. This may not be
immediately practicable, but, if it were possible, I would recommend:
(a) That where the price of milk to producers is fixed, it be fixed
on the basis of delivery at the farm.
(b) In default of this I would recommend that the Milk Control Board
be given the power to fix rates for transporting milk and to desig-
nate and license all truckers of milk.
(c) That the licensing of such truckers under the Commercial Vehicle
Act be discontinued.
(d) That the practice of conducting hearings before the Municipal
Board be discontinued, and that the whole power be vested in the
Milk Control Board.
(e) The regulations under the Milk Control Act. and the Milk Control
Act itself, should also be clarified to give the Board authority to
designate routes for such truckeis.
The foregoing observations in respect to the transportation of
fluid milk apply with equal force to the transportation of milk
and cream to condensaries and creameries.
(f) That the regulations be changed and the Commercial Vehicle Act
be amended to permit farmers to haul milk co-operatively through
co-operative associations for themselves and their neighbours, and
that such permission be granted without regard to other existing
facilities.
Special Recommendations in Respect to Distribution
In the hope that experiments in further economies, such as quantity
discount sales, depot sales, every-other-day delivery, five and six-day
delivery, zoning and similar practices will be actively investigated and
tried, it is recommended:
(a) That the retail consumer price should be made open and com-
petitive without fixation by agreement or Milk Control Board order.
(b) That the special distributor economies brought into effect in 1941
and 1942 under wartime conditions be retained by the distributors.
(c) That all distributors be required to maintain a complete and
standardized set of business and financial records.
(d) That returns sufficient to enable the Milk Control Board to deter-
mine their costs and profit margins be required of all distributors,
to be filed not less than three months after the end of their
fiscal year, these records to include details of capitalization, de-
preciation and financial policies generally.
Recommendations in Respect to Consumers
It must be apparent from a perusal of Chapter 7 that, looking at the
over-all picture in Ontario, no recommendations as to price reductions
from those presently obtaining can be made when the interests of all the
distributors are considered. Mr. Entwistle's report shows that about 12
XIV ONTARIO ROYAL COMMISSION ON MILK
per cent in number of the distributors, who apparently distribute more
than 50 per cent of the fluid milk in the Province, could sell milk at
cheaper prices. I suggest that cheaper prices might be brought about by
providing for a free competitive price at the consumer level. If it is done
bv other means it may well be that the larger number of the distributors,
something in excess of 750 in all, will not be able to withstand the
financial pressure of prices lower than those presently in effect. So
far as volume distribution is concerned, it would appear that such a price
reduction would adversely effect those who distribute less than half of the
volume of fluid milk sold. It would unquestionably affect many of the
distributors in smaller markets.
It is a question whether it is best in the public interest to maintain
the existing large number of small distributors in certain cases at the
cost of milk consumers; or whether through arbitrarily narrowing the
distributor's spread it is better to accelerate the slow process of amalga-
mation that has been going on among the distributors since the passing
of the Milk Control Act in 1934. Arbitrary narrowing of the distributor's
spread at the present time would undoubtedly accelerate the process of
amalgamation and consolidation, and the distribution end of the industry
would end in the hands of a few large distributors. As they aie presently
situated, the smaller distributors, except in rare instances, could not with-
stand the financial pressure resulting from such a policy. Insofar as
many of them are concerned, the result might be financial embarrassment,
forcing them to amalgamate with their competitors to obtain larger volume,
or they might be forced to sell out to the existing large volume dis-
tributors. Which state of affairs is the most desirable is a question of
public policy, on which it would not be proper for me to comment. In
mv view, however, the abolishing of the practice of fixing prices for fluid
milk to the consumers and the restoration of competition as to price
among the distributors, is well worth trying before other measures are
considered.
Nevertheless, despite the apparent costs of production and distribution
at the present time, in view of the fact that cheap milk generally means
large volume of consumption, it might well pay both the producers and
the distributors of fluid milk arbitrarily to cut their prices all along the
line to something approaching the level obtaining before the price increases
of October 1, 1946, or in any event by a substantial amount. The problem
of the producers' surplus, which seriously affects the average price re-
ceived by the producer, might no longer be so pressing. The experience
of the distributors over the war years under conditions of rapidly expanding
volume and low consumer prices might justify them in again trying the
experiment.
It is recommended that the necessary amendments be made to the
Municipal Act and the Milk Control Act to permit the setting up and
operation of municipally owned distributor plants with power to deal in
all dairy products and that in so doing such distributor operations be
made liable to Municipal and Provincial taxes in like manner as other
distributors.
Finally, it is recommended that consideration be given to supplying
milk to school children in primary and secondary schools through public
assistance at cost, or in cases of necessity free of charge; and that in
considering the same, attention be paid to the provisions of the National
Milk Scheme in Great Britain.
ONTARIO ROYAL COMMISSION ON MILK XV
Recommendations in Respect to the Cheese Producers
In respect to the cheese producers, discussion of their problems in the
Chapter relating to them does not give rise to any special recommendations,
but it would seem essential:
(a) That they take steps which should be implemented in any way
possible by the Department of Agriculture to improve the quality
of their product and to extend a further and more effective control
over its final marketing.
(b) That steps should be taken to familiarize the industry with the
provisions of the legislation, both provincial and dominion, pro-
viding for financial assistance with respect to the erection of
amalgamated factories.
(c| That the cheese milk producers give most serious consideration to
the formation of an over-all marketing scheme.
Recommendations in Respect to the Cream Producers and Creameries
The general recommendations made in respect of Transportation would
apply with equal force to the transportation of fluid cream used for
butter-making. The recommendations already made in respect of an over-
all marketing scheme apply with particular force to this large group of
producers.
No doubt anv experience gained in the marketing of cream under the
Farm Products Marketing Act should be most valuable and should be
studied carefully.
Specificallv the only additional recommendation I wish to make is that
every effort be made by producers, creameries, and through governmental
assistance, to greatly increase the volume of production per plant.
Recommendations in Respect to the Condensaries
Many of the observations made in respect to the distributors of fluid
milk apply to the manufacturers of milk. It is recommended:
(a) That the Manufacturing Milk Board be given clear authority under
the Milk Control Act to require standard methods of accounting,
and full and regular information from the manufacturers in connec-
tion with their operating costs and profits,
(b I That where such operations in the province represent branch
operations of larger' concerns with headquarters outside this juris-
diction, a division be made between the business done within and
without the province: and to effect this, regulations be made
standardizing the accounting methods of these firms.
(c) That along with the study of producer costs in other branches of
the dairy industry there be included a study by the Milk Control
Board of the costs of producers who produce milk for concentration,
(d) That the producers of milk for concentrated purposes be encouraged
to undertake the formation of co-operative processing plants as a
means of ensuring that these producers receive the full competitive
price for their milk and that consideration be given to providing
public assistance for such projects.
(el That the Milk Control Board investigate the present prices paid
concentrated producers for their milk, and in view of the financial
situation of the manufacturers, consider whether price increases to
producers beyond those already granted should not now be
enforced.
ONTARIO ROYAL COMMISSION ON MILK
CHAPTER II
Introduction and Procedure
At the outset it was impossible not to be impressed by not only the
importance of the product under investigation but also the substantial
nature of the industry concerned. It is interesting to note that in 1946, the
most recent year for which Dominion Bureau of Statistics figures are avail-
able, the dollar value of milk production from Ontario farms was set out at
$154,981,000. It is estimated that upward of 16,000 producers regularly
produce milk for fluid consumption in cities, towns and villages of the
Province; that 76,000 producers produce cream for butter; that 23,500
produce milk for cheese and there is an additional 14,000 producing milk for
manufacture of concentrated products.
In addition to those engaged in primary production there are approxi-
mately 20,000 persons engaged in the processing, transporting and distribut-
ing of milk and milk products, including butter, cheese, condensed and
evaporated milk and other dairy products.
THE PRODUCT ITSELF
Evidence adduced before the public hearings of the Commission made it
apparent that milk is a vital food to the public. In this connection I had the
evidence of two eminent authorities, that is Dr. L. B. Pett, of Ottawa, and
Dr. F. F. Tisdall, of Toronto. In the course of his evidence, which is set out
in Appendix 2, along with that of Dr. Pett, Dr. Tisdall stated:
"Milk contains approximately 3^ per cent fat, approximately 4 per cent
carbo-hydrates or milk sugar, and about SYz P^r cent protein. In addition,
it contains a large number of vitamins and practically all the minerals
essential for life with the possible exception of iron and perhaps iodine,
depending on the pasture. It is the most perfect single food we have today,
there is no other single food that contains as many nutrients essential to
life as does milk. Now we want to know if all these nutrients can be
replaced by other food sources, because if they can be replaced, and
replaced economically, then milk is not on any pinnacle, because we could
simply take perhaps three or four other foods and replace it, but I would
say from our studies, in every single study we have done concerned with
nutrition, our respect for milk goes up."
It is also amply apparent from the evidence before the enquiry that to a
large extent at least the ideas of the nutritional authorities have taken hold
of the public and they are beginning to appreciate the importance and
necessity of milk as an essential article of food.
PROCEDURE ADOPTED IN RESPECT TO THE ENQUIRY
Having regard to the importance of the subject matter of this enquiry,
the widespread public interest, and the fact that an opportunity was being
afforded to review for the first time the functioning and administration of
the Milk Control Act in the Province of Ontario. I considered it essential
to give every citizen who wished to do so, an opportunity to express his or
her views on these matters, and also to ensure that geographically and
2 ONTARIO ROYAL COMMISSION ON MILK
economically speaking, the local problems of all sections of the Province
from the viewpoint of producers and distributors be fully examined.
For these reasons the terms of reference were widely advertised throughout
the Province, together with a proposed itinerary of times and places of
hearings, and all interested persons were invited to notify me of their desire
to give evidence and to submit in advance a brief of the evidence they
proposed to give.
In selecting the places for holding public sittings, consideration was given
to the density of markets, and any special climatic features that might effect
costs and conditions of production and distribution. In the result, it was
determined to sit at Port Arthur, Fort William, North Bay, Belleville,
Ottawa, Hainilton, London, Windsor, and Toronto. No criticism of the
places selected was offered to me, although I specifically invited objections
and alternative suggestions.
Forty-two days were required to take all the evidence, and during the
course of the sittings, sixty-seven briefs were submitted and one hundred
and fifty-four witnesses heard. The names of the persons and organizations
submitting briefs and the names of the witnesses heard are attached as
Appendix 1.
The evidence extends to 5,681 pages.
29 Witnesses appeared as Distributors.
70 Witnesses appeared as Producers.
39 Witnesses were consumers or represented consumers, for example, the
Mayors of the Cities of Toronto and Hamilton, and the Citv Solicitors of
Ottawa and Windsor.
6 Witnesses appeared as milk haulers, and 12 expert witnesses were
heard on subjects ranging from the applicable legislation to nutrition.
ONTARIO ROYAL COMMISSION ON MILK
CHAPTER III
Milk Control Board
The second item referred to me, namely the scheme contemplated by the
provisions of the Milk Control Act, R.S.O. 1937, Chapter 76, as amended,
and the administration thereof by the Milk Control Board precedes chrono-
logically any examination of the milk and dairy industry as it exists today,
and affords a background of some value in reaching conclusions regarding
the circumstances in which the industry exists at present. The second item
of reference is therefore dealt with first.
Origin of Legislation
Milk control legislation was a product of the serious business depression
of the 1930's. As Dr. Roland W. Bartlett of the University of Illinois has
pointed out in his valuable study of the milk industry in the United States,
such legislation was primarily a result of the economic depression between
1933 and 1940. In the United States, during that time, some 26 states and
the federal government enacted legislation to fix prices which consumers
should pay for milk. In Canada, in the 1930's, most of the provinces
enacted similar legislation to the Milk Control Act.
In Ontario the industry had by 1933 become completely disorganized. At
that time, apart from considerations of continuing supply and maintenance
of quality standards, the consuming public did not need protection or con-
sideration by the industry, but the industry, including both producers and
distributors, very badly needed protection from the consuming public which
was consuming milk at retail prices substantially below any estimated cost
of production at the farm itself.
The London. Ontario, market at that time illustrates this situation. The
price structure which existed there for a number of years prior to 1932
had by 1933 almost entirely disappeared. Prior to 1932. there had been a
recognized price structure ending with a consumer price of 11 cents per
nuart. The producer was being paid S2.12 per hundred weight of milk.
Early in 1932 the price had decreased with great rapidity and by April of
that year the farmer was getting SI. 30 per hundred weight of milk and the
consumer was paying 9 cents per quart.
Competition at the distributing end of the industry was extremely keen
and practices such as the giving awav of premiums with milk and the
giving of a period of free milk to new customers were common.
While from an entirely short range view these practices may have been
very satisfactory to the consumer, over any long range view they were ruinous
not only to the dairies but to the farmers who produced the milk.
The situation became so serious that the then Minister of Agriculture, the
Honourable Thomas L. Kennedy, appointed a departmental commission of
inquiry which was asked to conduct an investigation for the following
purposes :
(1) To determine the causes of the extremely low price of market milk
in the city of London.
(2) To determine if this low price has resulted in any deterioration of
the quality of milk sold in the city of London.
(3) To make recommendations regarding improvements in the situation.
4 ONTARIO ROYAL COMMISSION ON MILK
Those making the enquiry consisted of a number of gentlemen representing^
various divisions of the industry. The city council of the city of London
was also represented.
By the time the committee had gotten under way the situation had
deteriorated still further and a brief excerpt from the majority report to the
Minister succinctly sets out the situation:
"In 1932 the mutually agreed price between producer and distributor
was set at $1.30 per hundred pounds to the producer and a retail price of
9 cents per quart and 5 cents per pint. This price prevailed from August
26, 1932, to December 1st, 1932. During the last half of 1932 various
abuses crept into the trade, such as: First — the giving away of free milk
for a time as an inducement to new customers: and Second — the giving
of premiums. This gradually precipitated a price war which became so
disturbing to the general trade that a number of the distributors were
forced to reduce the price to the consumer, thus forcing down the price to
the producer. The price to the producer at that time was forced down
by abnormal competition to $1.00 per hundred pounds and most of the
pasteurizing distributors, — estimated at two-thirds of the trade and volume,
— sold at 7 cents per quart and 4 cents per pint, with the balance of the
trade selling at from 5 to 6 cents per quart at the present time.
"It is reported that some distributors have paid for part of their milk on
a surplus price basis, some of which was said to have been bottled and
sold as liquid milk instead of being manufactured into by-products. This
surplus price is variously estimated at from 85 cents per hundred pounds
to as low as 50 cents per hundred pounds."
It is interesting to note that the majority of the committee suggested a
fixed price as a result of their enquiry, to the producers, and also a fixed
price to the consumer. This was objected to by the member of the com-
mittee representing the city council of the city of London, chiefly, I think,
on the ground that he wanted as cheap milk as possible for the consuming
public, regardless of the cost of producing and distributing it.
It was stated by witnesses during the present enquiry that in 1932 and
1933 other markets throughout the province were experiencing similarly
depressed and demoralized conditions, and finally in the year 1933 the
Milk Producers' Association approached the provincial government and
asked for an act to regulate the fluid milk business, and to bring order out
of the chaotic conditions prevailing.
The situation was not peculiar to Ontario, as apparently at the same time
a similar situation obtained in Manitoba. Alberta and Quebec, where similar
statutes were shortly afterwards enacted.
It is only necessary to read the report on the Reorganization Commission
for Milk under the chairmanship of Sir Edward Grigg to realize that very
similar conditions also obtained in Britain. These conditions were, of
course, the result of a world-wide period of economic depression and
distress. The whole price structure of the industry was in a state of complete
confusion and in the result the first Milk Control Act introduced at the
1934 session of the legislature of the province of Ontario passed, I am advised,
by the unanimous vote of the house.
I have emphasized the conditions which give rise to the first Milk Control
Act, because in my view they have influenced the administration of the
system ever since. One has only to read the provisions of the first Act,
Avhich Avas substantially amended in the years immediately following, to
realize that what was desired was machinery which would permit the industry
ONTARIO ROYAL COMMISSION ON MILK 5
to organize itself on some rational basis including a rational price structure,
bearing a reasonable relation to costs of production and distribution.
The matter was primarily looked at from the viewpoint of the industry itself
which was asked through the agency of the Milk Control Board to establish
itself on a proper basis. In view of the conditions which prevailed at that
time, little thought seems to have been given to the position of the consumer,
who quite naturally was taking advantage of the situation to obtain milk as
cheaply as possible, and who was, in fact, obtaining it at prices at which it
could not possibly be produced and distributed if costs were to be met.
As the present Chairman of the Milk Control Board said to me in his
brief:
"It can be fairly stated that the main object of the first and succeeding
Boards has been to bring about the orderly marketing of milk, that is,
to apply the Act in such a way as to provide conditions under which the
various milk markets of the province will function effectively, economically,
and in the general interests of society. To attain this main objective, the
various Boards, each in their turn, have striven to improve the economic
position of the producers consistent with a fair price to the consumer."
In one sense I think it can be said that the various Chairmen of the Milk
Control Board have represented the public interest in carrying out their
duties, and there is no evidence before me which would suggest that they
have attempted to do anything else. Nevertheless, I think it can be fairly
said ,that both from their composition and by their actions the various Milk
Control Boards since 1934 have primarily devoted their attention to setting
up and maintaining a stabilized and rationalized industry, and that the
special interests of the consumer have not been given the weight later
experience might have suggested was desirable.
Insofar as the efforts of the Board in respect to the industry are concerned
I think it can be said quite fairly that the objectives with which this plan
of regulation commenced have been realized. It was quite apparent on the
hearings before me that the Producer and Distributor associations had
reached an accord and had closed their ranks in the face of a critical public
who wanted milk at prices they deemed unfair and insufficient.
In Appendix 4 and 5 there is set out the original Milk Control Act with
amendments and changes down to the present time.
COMPOSITION OF BOARD AND GENERAL POLICY
While nothing was said in the original Act as to the composition of the
Board in respect of the fluid milk market, the Board has been composed of
a representative of the producers, a representative of the distributors, with
a Chairman appointed by the government of the day, who has generally
been a permanent civil servant.
In administering the Act the various Boards have consistently taken the
stand that the producers and distributors should endeavour to arrive at
prices and trade practices on a voluntary basis. To bring this about the
Board has encouraged and recognized local and provincial industrial asso-
ciations and the Chairman of the Board was able to tell me that this policy
has resulted in practically all the cities and towns in the province having
local producer and distributor organizations affiliated with central organiza-
tions representing their interests.
O ONTARIO ROYAL COMMISSION ON MILK
The organization representing the producers is the Ontario Whole Milk
Producers' League, while the distributors are represented by the Ontario
Milk Distributors' Association.
During the eleven or twelve years in which the Act has been in operation
the industry has for the most part functioned in accordance with this policy
of self-regulation.
Up to a short time before this investigation commenced, the Board pro-
ceeded on the assumption that it had power to fix prices under section 4
of the present Act. and as a result of this belief, up to the fall of 1946. there
were a number of price orders by the Board, the majority of which were
the result of producer and distributor agreements. A record of the orders
issued by the Board is set out in Appendix 6.
In instances where voluntary agreements were impossible the Board arbi-
trated the dispute and issued arbitrary orders on producer and consumer
prices .
As the years have gone on there has been apparently less tendency to
agreement between the producers and the distributors, and as Appendix 6
shows, the number of orders imposed by the Board on producers and
distributors has increased. This was particularly true after the outbreak
of the recent war and reached its height in 1941. It was apparently adjusted
by the year 1942, when the industry had settled down to the conditions under
which it had to operate, and by which time the producers and distributors
had each realized the position of the other in respect of costs.
According to the evidence of the present Chairman of the Board, in addi-
tion to the Board members the staff consists of a general secretary, an office
staff of three, and two groups of field men aggregating ten in all.
The work of the first of these groups consisting of eight men consists of
check testing to see that the regulations under the Act are observed with
respect to weighing, sampling, butter-fat testing and the correctness of
payment for milk supplied by producers.
The second group makes specialized investigation into irregularities of
a major nature reported by the field men in group one or arising from
complaints by either producers or distributors.
Against this should be put the fact that there were licenses issued in the
) ear 1946 to 635 regular distributors, to 346 producer-distributors and to 83
milk peddlers. The possibility of doing even an adequate spot checking
with a staff of this size in a field so large seems to be asking more than can
be reasonably expected.
I think, therefore, it can be fairly said that at no time has the Board had
sufficient staff to enable it to adequately investigate either the cost of pro-
ducing fluid milk on the farm or the cost of distributing the same by the
various dairies, and apart from some spot checking of financial statements
of distributors for the Board by auditors it was not until the year 1946 that
a serious attempt was made by the Board to arrive at any conclusions in
this respect. The previous negotiations and agreements as to price, which
the Board confirmed, and the orders which the Board made as to prices,
were based on representations to them by the producers, who, in my opinion,
at no time have had any adequate knowledge of their costs, and by the
distributors in the markets concerned, who probably had a very good idea
of their costs. The situation as to knowledge of costs will be dealt with
in greater detail later in this report.
In saying this, I do not intend to criticize the administration of the Board
ONTARIO ROYAL COMMISSION ON MILK i
which I think has done the best it could with the facilities afforded it. but
it is amazing that the system has functioned as well as it has.
As I think will be demonstrated later in this report, it is quite obvious
that farmers as a group, or as individuals, do not know their costs of
production, and there is the widest variation in costs as between individual
producers.
As appears by the first report of the Milk Control Board for the year
1934, after the setting up of the Board, producers and distributors in the
various markets of the province began to take advantage of the powers
given to the Board and price agreements in many cases were arrived at.
Even in the early stages of the Board's work, wherever possible the Board
simply approved agreements between producers and distributors and by
1946 as appeared from the evidence submitted before me, it could be fairly
said that most of the principal markets of the province were covered by
agreements in which prices paid to producers and prices paid by consumers
are fixed either by agreements approved by the Board or by Board orders.
While in 1946 some question as to the Board's authority to fix prices
under section 4 of the Act was raised by the law officers of the Crown, prior
to that time, during the twelve years of the Board's existence a fairly sub-
stantial and widespread price network had been built up under its authority
over the entire province.
As the Chairman said in his brief to this Commission:
"It can be seen that the Board's policy on prices has been in the main
to have the industry on a self-regulatory basis but w^hen an impasse has
occurred the Board has used its powers to regulate prices."
ADMINISTRATION OF THE MILK CONTROL ACT
BY THE BOARD
It is not practicable to deal with the year by year administration of the
Board except the work done during that time, which illustrates certain
general tendencies which have developed in the Board's work.
The principal tasks of the Board have been two-fold: Firstly, the exercise
of judicial functions, that is, the dealing with the granting and revoking of
licenses and the policies connected therewith: and, secondly, the general
administrative functions of the Board.
It is proposed to consider these two aspects of the administration of the
Act separately.
Despite this separation it is only fair to comment that the administrative
policy adopted toward the industry and in respect of it has very frequently
coloured the judicial aspect of the Board's work. An example of this is
found in the fact that in the opinion of the Board there were too many
persons in the distributive side of the industry and in consequence of this
it has been the policy of successive boards to refuse new licenses for entry
into the business except in cases of most obvious necessity.
In the report to the Minister by the Board for the year 1939 covering work
done in 1938 under the heading of "Consumer Services Rendered to the
Industry" it was said that the Board had done much to carry out the purpose
for which it was constituted, that is, to do — what the industry itself could
not do — to bring about a rationalized fluid milk distribution in the Province
of Ontario.
One of the results listed under this heading was as follows:
S ONTARIO ROYAL COMMISSION ON MILK
"The consistent use of the Board's authority to refuse to issue new
distributor licenses, or to extend the territory covered by existing Hcenses
unless in the Board's opinion such issuance would be in the public interest
has done more to rationalize the industry than any other action."
This statement reiterates what is set forth as a definite Board policy in
the report to the Minister for the year 1937, where it is stated:
"The general attitude of the Board towards licenses is that there are
already too many licenses in effect in most markets of the province and
that the issuance of more licenses will react ultimately to the disadvantage
of both the producer and the consumer as a result of increased overlapping
and duplication of services."
THE JUDICIAL FUNCTIONS OF THE BOARD
As presently constituted the Milk Control Board is an administrative body
■exercising judicial functions. It must license all persons who directly or
indirectly engage in or carry on the business of distributing, transporting,
processing or selling milk. To refuse or cancel such a license is to refuse
or prohibit the carrying on of business in the industry. The provisions upon
which licenses are granted are set out in section 5 of the Act, as follows:
"No license shall be granted to a milk distributor unless the Board is
satisfied that the applicant is qualified by experience, financial responsi-
bility, and equipment, to properly conduct the proposed business, and
that the issuance of a license is in the public interest."
Section 6 is also of interest, and provides that subject to the provisions
of section 5 the Board may refuse to grant or renew licenses or may suspend
or revoke licenses already granted after due notice and the opportunity of
hearing applications, when the Board is satisfied of three conditions; viz.:
the failure to carry out and perform the provisions of certain public statutes
relating to milk for human consumption, failure to provide for and continue
the proof of financial responsibility, and failure to observe and carry out
regulatory orders of the Board made under the Act.
It is provided by section 9 of the Act that an appeal shall lie by way of
originating notice from any order or decision of the Board made under
section 5 or section 6, to a judge of the Supreme Court, and it is provided
that he may receive evidence and give directions for the conduct of the
proceedings and may make such order as he deems just. There is no further
right of appeal.
The files relating to application to the Board for licenses were made avail-
able to me and an examination of them covering years 1934 to 1946. inclu-
sive, reveals the manner in which this function has actually been exercised.
Generally speaking it can be said that for the first five years the Milk Control
Board was thoroughly engaged in stabilizing the industry and becoming
acquainted with the type of problem to be faced with respect to licensing.
When the Milk Control Act first came into force in 1934 licenses were issued
to all existing distributors and producer-distributors with the exception
perhaps of a few very small operators who may not have come to the
attention of the Board at once.
In the first few years the Board leaned very heavily on local producers
and distributor associations in the matter of licensing existing operators or
in dealing with new applications. Certainly, in the first two years the
ONTARIO ROYAL COMMISSION ON MILK V
Board was extremely reluctant to take advantage of the punitive sections
of the Milk Control Act when infringements of the Act were clearly taking
place. Very considerable eflfort was devoted to securing compliance with
the letter and spirit of the legislation by discussion and correspondence
even when it was clear that milk was being distributed without licenses and
in open defiance of the Act.
By 1939, however, the Board appears to have felt that it was in a position
to consider the industry stabilized and to deal with new applications in what
appears to have been a very rigid manner. In fairness to the Board it
should be said that the prime consideration in dealing with new applications
for licenses seems to have been the adequacy of existing facilities as furnished
by persons already licensed. If, in the Board's opinion, the market was
already adequately served, licenses were refused as a matter of course.
Similarly, if there was any evidence that the applicant was not financially
responsible, or proposed to make raw milk available to an area in which
compulsory pasteurization was enforced, applications were refused on these
grounds.
No criticism is ofifered of the grounds on which the Board purported to
base its decision, but the method of arriving at these decisions cannot in
any sense of the word be said to have been judicious and in some instances
methods were employed to arrive at a decision which can only be considered
as improper.
From the records made available to me, it would appear that no guide
was furnished to the applicant as to the type of evidence which he should
submit to show public necessity or convenience for the granting of a license
to him, with the result that when such evidence was not produced, the
Board without hesitation held that in the absence of such evidence applica-
tions must be refused.
In some cases notices of the refusal of licenses were given to the applicant
without any opportunity being afforded to him to attend and state his case,
although such action is contrary to section 6 of the Milk Control Act.
In other cases, applicants for producer-distributor licenses, who would
operate in a very small way. have been invited to attend a hearing in Toronto
when such was obviously impossible financially for the applicant. This
applies particularly to persons applying from the extreme north-western
section and other distant parts of the province, for whom a trip to Toronto
would involve travelling upwards of 3,000 miles. The failure of the applicant
to appear on a hearing after being notified to attend was invariably used as
a reason for finally refusing his application.
There is strong evidence in the files to substantiate the impression that
where any applicant for a new license was opposed by an existing licensee,
especially if such licensee was an operator in a substantial way, that the new
applicant was certain of refusal.
In one case an application was made by a person who had been in the
distributing business, for a license to commence operations in a substantial
community in Northern Ontario. At the time of the application there was
only one licensee, a subsidiary of a very large company. The original
application was supported by the local authority and the applicant was
advised of the approval of his request. Subsequently and within a very
short time, affidavits were filed in the office of the Board by an officer of
the existing licensed company accusing the applicant of improper practices
in his previous business. As far as the files show, no effort whatever was
made to examine witnesses making these depositions before the Board, and
10 ONTARIO ROYAL COMMISSION ON MILK
the applicant was notified to suspend operations. An employee of the Board
was then despatched to the community, and his report shows that, while the
witnesses were prepared to state their evidence to this employee of the Board,
they did not want to become further mixed up in the matter. His report,
however, says that the applicant was highly spoken of, and from all appear-
ances was a reputable person. This employee of the Board then makes the
astounding recommendation that the applicant be required to furnish financial
responsibility bond in an amount known to be in excess of his capability and
far in excess of the normal requirement in order to avoid any suggestion that
the Board was acceding to the representations of the existing licensee. This
novel suggestion was not adopted by the Board but the application for the
license was forthwith refused and the existing licensee remains the sole
distributor in the community.
The entire procedure with respect to dealing with applications for licenses
should be reviewed and a system instituted which will result in the Board
having all the facts before it and in the applicant knowing at the time of
his application precisely what he must prove in order to receive consideration
for the granting of a license.
In very few cases was any investigation of the local conditions carried
out and refusal of licenses seemed to have been almost a matter of course.
If the applicant were required to fill out an exhaustive questionnaire with
respect to the size of the market, the present facilities and his own financial
responsibility and experience in the industry, with his attention specifically
directed to the question as to whether or not the market was large enough to
support an additional licensee, much of the present unfair method of dealing
with this matter would be eliminated. In addition, when the Board was of
the opinion that in the absence of further evidence it must refuse the
application, then some real opportunity should be provided for the applicant
to state his case orally, and not merely to appear to be given such opportunity
as seems to have been the situation for the last nine years. In respect to
the Board's power to cancel licenses and its power to deal with infractions
of the Milk Control Act regulations and Board orders, an examination of the
files of the Board indicates that throughout the Board has endeavoured to
secure by every possible means short of exercising its full power compliance
and co-operation of licensees with the regulations. In those cases in which
more drastic action has been taken it can be said that such action was
abundantly necessary and appeared to be the only method of enforcing the
orders and regulations.
It should be observed that one of the factors that influenced the Board in
approaching the problem in this way was that a licensee invariably had a
substantial part of his capital and livelihood involved in the business and
every effort was made to protect him from the consequences of his failure
to observe the regulations.
It is, of course, a matter of great difficulty to disassociate policies of
bureaucratic administration from the exercise of judicial functions when
thev are vested in the same persons. It is nevertheless very desirable that
there should be a distinct cleavage between the two. It is perhaps asking
too much that the Milk Control Board, in its judicial functions, should be
able to look with complete detachment on its administrative policies a:vd
practices when it is called upon to deal with the granting or cancelling of
licenses or other disciplinary matters within the industry which it is required
to regulate. Such a confusion of administrative policy with judicial function
is a natural consequence of the practices which have prevailed, but it seems
ONTARIO ROYAL COMMISSION ON MILK . 11
to me to be in the public interest that in future there should be a division of
such functions. One possible solution is to adopt the practice taken under
the Insurance Act which provides for the setting up of what is called an
advisory board. This provides that the Superintendent of Insurance, when
so requested in writing by an applicant or licensee, may nominate an advisory
board which in that case consists of a representative of the Superintendent,
who is Chairman, and a representative of the other interested parties, mainly
the insurers and the agents. If some such similar device could be used by
the Milk Control Board with appropriate changes to suit the conditions of
the dairy industry, I am satisfied that there would be a much more judicial
determination of the problems with which the Board has to deal in this
respect, and the whole problem of disciplining and licensing would be dealt
with in a more impartial and objective manner.
In my view, it is quite impossible to fairly combine powers of bureaucratic
administration with those of a judicial nature in the same person with any
hope of dealing impartially with the subject's rights.
THE ADMINISTRATIVE FUNCTIONS OF THE BOARD
Apart from the oral evidence of the Chairman and other witnesses who
had been members of the Board, much assistance in valuing the accomplish-
ments of the Milk Control Board is obtained by a perusal of the annual
reports of the Board to the Minister of Agriculture. These reports cover
the period from the time of the establishment of the Board down to the
present time and have substantially corroborated the impression I gained
from the other evidence as to the scope and general nature of the Board s
activities.
It must be remembered that the Board was constituted, as I already indi-
cated, in a period of stringency, when the position of the producers for the
fluid milk market was nearly desperate and the industry in general was
completely disorganized. It must also be realized that in all, insofar as
personnel is concerned, there have been nine different boards, and that
while there is a fairly continuous thread of policy through the entire period
of operation, the policies and aims of the Board have undoubtedly been
influenced from time to time, as one would expect, by general government
policy. It should also be noted that, apart from the Chairman, who theoreti-
cally is independent, the Board is composed of individuals actively engaged
in either the production, distribution or processing of milk.
The view taken by the Board in its second full report, which was made
in the year 1936 and covered the year from March 1935 to the succeeding
March, indicates, I think, the basic policy pursued by the Board since that
time and is worth setting out. At that time it was said:
"In all its work the Board has kept in mind the primary purpose of
the legislation creating it, and has worked steadily for improvement of the
position of the milk producers so long as such improvement could be
obtained without undue hardships being placed upon the other two interest-
ed parties, the milk consumers and the milk distributors."
That this was recognized is evidenced by a further quotation in the annual
report of the Chairman of the Ontario Whole Milk Producers' League, given
at the Annual Convention of the members of the League:
"The work of the Milk Control Board of Ontario, with the added
strength given it by the amending of the Act, has tended to stabilize the
12 ONTARIO ROYAL COMMISSION ON MILK
market and has eliminated many of the evil practices which, without it,
would have broken not only the local market but the whole provincial
structure."
The Board was able to report that as a Board of referee or arbitration it
had avoided difficulties in several markets, and from the state of chaos existing
in the industry in 1933 there had been a change to a state where reasonable
order and prices had been established in many markets on a fairly satisfactory
level.
This was accomplished by the Board pursuing its work along four definite
lines:
(1) The licensing of milk distributors.
(2) The bonding of milk distributors, who purchased their supplies of milk
from milk producers.
(3) The approval of agreements arrived at between producers and
distributors.
(4) The handling of certain miscellaneous problems which arose from
the operation of the other three policies.
It was quite obvious that what was being done was to force the industry
to set its own house in order, and even though it was also obvious to the
early Boards that certain economies in the operation of the industry might
improve the situation, even at that time no great pressure was exercised on
the industry to bring this about. As was pointed out in the first report, one
of the most important expenses in milk distribution is the cost resulting
from the loss of bottles, and it was suggested that if bottles were charged
for, much of these bottle losses would disappear. No definite action was
taken, however, to bring this about.
It also appeared at that time that the Act needed certain amendments to
give the Board somewhat larger powers and substantial amendments were
passed at the 1935 session of the legislature. The original Milk Control Act
and the various amendments that have been made are set out in Appendices 4
and 5.
LICENSING FROM THE ADMINISTRATIVE SIDE
Initially it was the view of the Board that there were too many milk
distributors in the business, and in consequence of this belief new licenses
were issued very reluctantly. In the year from March 1935 to March 1936
some 1,624 licenses had been issued to milk distributors.
The view was taken that public interest coincided with the interests of the
industry as a whole, and that if there were too many engaged in the industry
it was considered part of the Board's function to remedy this situation.
It had been provided by an amendment to the Act in 1934 that new licenses
should be granted to milk distributors only if the Board was satisfied that
the applicant was qualified by experience, financial responsibility and equip-
ment, to properly conduct the proposed business and that the issuing of a
license was in the public interest. It is. I think, arguable, whether an over-
crowded industry insofar as distributive outlets are concerned is in the
public interest or not, but for better or for worse, the Board apparently
took the view that it was not and has clung to that point of view ever since
without attempting to force a reduction in the number of distributors. This
is emphasized time and again in the reports of the various Boards and as
the section of this report dealing with the exercise of this function, which is
a judicial one, indicates it has been carried on in a manner which precluded
any real consideration of the merits of individual applications. The
ONTARIO ROYAL COMMISSION ON MILK 13
result has, I think, been actually to improve conditions in the industry.
It has, of course, also substantially reduced the number of competitors
within the industry itself. There are approximately 170 communities with
a single distributor licensed. For the most part these are very small, but
29 communities have populations between 1,000 and 2,000, six have popula-
tions from 2,000 to 3,000, and Copper Cliff with a population of 3,732, and
Sturgeon Falls with a population of 4,576, complete the list of larger
communities where a complete monopoly exists.
In 1936 the licensing of milk distrbutors was done on a basis of a division
into three classes which are known as regular distributors, producer-
distributors and milk peddlers. The terms are reasonably self-explanatory;
the regular distributors being those persons, partnerships and corporations,
selling milk commercially; producer-distributors being those who not only
produce the milk but later on distribute it; the milk peddlers being the small
class of persons who have grown up mostly during the depression years and
who purchased milk as a rule from other processors and distributed it
personally along limited routes.
By March, 1936, the Board was able to say that the licensing of milk
distributors in the province selling more than 20 quarts a day was practically
complete, and that 99' 2 per cent of the distributors had complied with the
bonding requirements under the Act.
Exceptions to this policy were those distributors whose payment to
producers are on a weekly basis or who. at no time, owed producers more
than $100.
The list of licenses issued appears in detail as Appendix 3.
While the Board initially took the position that, under the Act, it had
no authority to actually set milk prices except when called upon to arbitrate
a price dispute, it nevertheless had authority to approve all agreements
between producers and distributors, and by 1936 some seventy markets in the
provinces had agreements which were so approved. This included most of
the larger markets in the province and many of the smaller ones.
Also by 1936 the provisions of the Act relating to consumer representatives
from municipalities concerned in any particular market had come into being,
and the Board seemed to feel that each agreement was considered in the light
of fairness to all persons concerned, including consumers as well as
distributors.
CONSIMER REPRESENTATION
From the evidence before me I would be somewhat dubious as to whether
consumer representations were as effective as these reports would indicate.
Every consumer representative that I heard, including the Mayors of Toronto
and Hamilton, gave me the general impression that as a rule the Board did
not disclose to them sufficient facts to enable them to come to any intelligent
conclusion on the problem with which they were asked to deal. Confidential
information in the possession of the Board as to the position of both producers
and distributors was apparently not disclosed to them, and in my view the
intention of the Act in giving consumer representation has been largely
defeated by the administrative policies adopted, and has in fact been an
empty procedure.
GENERAL PROBLEMS OF ADMINISTRATION
Quite early in its administration, and definitely by 1936. the Board had
established a system of special audits of distributors" books where there
14 ONTARIO ROYAL COMMISSION ON MILK
was some suggestion of error or under-pa) ment to producers, and in that
year, in collaboration with the Ontario Department of Health, a scheme was
devised to create better sanitary conditions in the plants of milk distributors.
Up to this point the achievements of the Board had been concerned chiefly
with the bonding provisions of the regulations under the Act and the auditing
in cases where it seemed indicated, with the result that producer losses from
unpaid accounts were reduced to a minimum, and owing to rationalization
of the principal markets price improvements gained were maintained for the
benefit of producers.
As early as 1936 it was realized apparently that some effort should be
made to find out accurate costs of producing and distributing milk and to
provide for more complete and uniform records in the dairy plants. I will
allude to this later on but I am simply pointing out here that the necessity
of this was realized as early as 1936.
It was also recognized that some steps should be taken to stop uneconomic
practices such as special deliveries, small wagon loads, overlapping of
distributor service and bottle wastage. However, none of these uneconomic
practices were dealt with until the year 1942 under the stress of war condi-
tions, and some of them have not yet been dealt with.
As will appear from the various reports of the Milk Control Board, while
the need for these things was recognized periodically, the industry was
apparently expected to bring them about itself and it failed to do so. No
sufficient pressure was exerted by the Board to establish and maintain
accurate information as to costs or any uniformity of accounting practice
among distributors, and indeed such records are not yet available. In the
same way no special pressure was exerted by the Board to deal with such
matters as overlapping of distributor service, which matter remains to be
dealt with.
I mention these things merely to emphasize the point that the Board
functioned along limited lines and that what it attempted to do was to let
the industry rationalize itself. It did not attempt to step in and force im-
provements before the industry was ready to accept them.
It can be argued that this is a sound policy, and with the experience of the
last twelve years before me I am somewhat hesitant to condemn it entirely.
However, in the future if cheaper milk is to be sold in Ontario, greater
pressure along these lines will have to be exercised by the Board or whatever
governmental agency is regulating the milk industry as a whole.
By 1937 a complete system of licensing and bonding of distributors was
established and there were price agreements in eff^ect in all the larger
markets in the province. The position of the producer, which was the initial
concern of the Board, was now on a much sounder and more substantial
foundation than it had been before the Board commenced its work. It was
said that farmers' losses from unpaid milk accounts had been practically
eliminated, that producers were no longer compelled to purchase stock in a
dairy, and practices which produced disorder in the distributing end of the
business, such as the giving of premiums, had been ended; that increased
overlapping of milk trucking routes had been halted, and when cost increases
arising from changes in the feed situation made the position of certain pro-
ducers untenable, the relief was affected through the mediating agency of
the Board, without a large increase to the consumer.
About 1937 more attention was paid to the situation in respect to the
trucking of milk from the farms to the distributing centres, which is a very
serious item in connection with producer costs, and in the Toronto market
ON'^ARIO ROYAL COMMISSION ON MILK 15
a Milk Transport Committee was set up with the idea of preventing duplica-
tion of service and overlapping.
Apparently in that year some sort of attempt was undertaken to make a
study of the profit and loss statements of a selected list of distributors to
reach conclusions as to costs of operation, but no very significant conclu-
sions were reached. Bottle losses were considered and it was suggested that
legislation preventing the use of one dairy's bottle by another might be
enacted. The economy of a standard bottle had not yet been a matter of
consideration.
The following quotation from the 1937 report may indicate something of
the thinking of the Board in regard to the industry at that time. It was
stated: "that the control of the milk business should not be carried to the
stage where business initiative is prevented, and the question of consumer
prices was considered. It was concluded, however, that the present system
of control had eliminated many of the abuses in the industry and that there
were still many uneconomic practices which could only be corrected by a
fairly rigid control."
In May, 1938, the present Chairman of the Milk Control Board was
appointed and his first report as Chairman of the Board presents one of the
most complete and effective accounts of the Board's work and policy
available. At that time the Board had been in operation for some five years
and its lines of policy were fairly well defined.
There is nothing in the evidence before me, and I heard not only the
present Chairman but others who have been members of the Board from
time to time, to suggest that there has been any great change in policy in the
lines defined at that time and discussed in the report of the Boards for the
years 1937 and 1938. The basic control exercised bv the Board was that of
licensing. In respect of this it was observed, and I do not think the view
is any different today, that:
"The ridiculous extension and consequent overlapping of distributive
services which was so evident prior to 1934 had been halted and some
improvement secured."
It was stated that the Board had refused to issue any new licenses, or to
extend the territory covered by existing licenses unless it could be proved
that the service the applicant intended to give was needed in the public
interest, and in 1938 the number of licenses issued as a result of this policy
was some 223 less than those in effect in the previous year. It was stated that
few licenses had actually been cancelled, but that licenses surrendered
through amalgamation or failure had not been replaced.
It has also been considered that the bonding of milk distributors is one
of the major responsibilities of the Board, and while such a system is not a
complete guarantee to producers against loss under all circumstances, it has
unquestionably helped them. I am advised that since the Milk Control
Board came into being, that as a result of the bonding provisions, producers
have been saved directly a total of S.55,000.00. The chief value of bonding
is said to be that it not only prevents irresponsible operators from commenc-
ing operations as milk distributors, but that in effect the bond makes the
■producer a preferred creditor and often a personal creditor of the dairy
operator, and that in practice it has been found that the dairy operators make
every effort to meet their obligations to their producers rather than to permit
the bond to be called upon. In this respect see Appendix 7.
It is a tribute to the arrangement that while the coverage bv the bond is
limited and covers only one pavment period plus an extra period of approxi-
mately two weeks, the general result has been so satisfactory.
16 ONTARIO ROYAL COMMISSION ON MILK
PRICE FIXING
From 1936 to the latter part of the year 1946 the Board considered that
it had the power to fix prices pursuant to section 4 of the Act. As previously
suggested, serious doubts have been thrown upon this power, but if the
milk industry is to be controlled in any measure it would seem essential
to me that the Board should have such power, although there may be many
times when it should not be exercised. In any event, since the question had
not been raised up to that time, the Board proceeded on the assumption
that it had such power and in consequence milk marketing agreements were
approved in most of the fluid milk markets in the province, and also in most
cases between producers and processors in the concentrated milk field.
At the end of 1937 it was said that the milk produced on about ten
thousand Ontario farms was sold to consumers at regulated prices in all the
important urban centres throughout the province.
At the end of 1938 there were some 60 approved agreements in force and
there were 31 unofficial agreements in force which actually resulted from
the authority which the Board wielded.
The Bf)ard also carried on a system of check-testing, the Department of
Agriculture staff of milk check-testers being under the supervision of the
Board. This was combined with a system of spot auditing with respect to
payments to producers and apparently some attention was being given by
the Board to the rationalization of milk transport.
The Board's general policy towards the industry, upon which I have
commented before, has been. I think, frankly to bring about a rationalized
distribution of fluid milk in the province of Ontario, and wherever
possible this has been left to the industry itself to work out. In doing
so the Board has not brought pressure on the industry to effect im-
jMovements which might drastically improve the efficiency of the industry,
but has merely urged these improvements and changes on the industry with
the hope that those engaged in it would themselves adopt them. The Board's
administration may be fairly summed up bv saying that it has been primarily
concerned with creating a stabilized milk price structure in the major milk
consuming centres of the province, to which end the economic position of the
producers has been a prime consideration. Unquestionably some attention
has been paid to the consumer position in the matter, although it appears
to me that consumer representation has not been a verv effective factor in
the Board's deliberations.
By a system of check-testing of milk and auditing, payments to producers
have been kept at a reasonably accurate level; by the bonding of milk
distributors, producers have been given a further protection. In its attitude
to new entrants to the business the Board has done much to cut down what
appeared to be the overcrowded position among distributors and it appar-
ently has taken a consistent position that it is not in the public interest to
allow fresh entries into the business. The way this policy has operated is
commented upon in a previous section of this report dealing with the judicial
functions of the Board.
This stabilization of the industry has also been effected not only by
fixino the price paid to the producer but bv fixing the retail nrice at which
the distributor can sell to the public. By these means the distributors
have known precisely what their margin was and they have been relieved
of the cost of competing with price-cutting competitors. In respect to the
position of the producers, the fixed price has given them a more stable
position as they now know that the distributor cannot purchase milk more
cheaply from some other produ'i-er. Many other features which miirht
ONTARIO ROYAL COMMISSION ON MILK 17
ordinarily be evidence of competition between distributors, such as the
giving of premiums, cutting of prices and so on, have, as a result of these
policies, been made illegal.
Trade associations have been encouraged and the Board has leaned
heavily upon them, and while it is admitted that neither the producers nor
distributors associations are entirely representative, the Board has apparently
been satisfied to lean on them in the rationalization of the industry as if
they were in that position. The matter is fairly summed up in the 1938
report in the following words:
"In other words, it is the Board's opinion that the principle of the
trade doing everything for itself that it could do is the correct one; and
that the Board's place should, increasingly, be to carry on only those
activities that the trade finds itself impossible.'
In later years, and with the coming of the war. conditions changed some-
what in that there was greater pressure on both producer and distributor
because of the fact that their costs began to rise. By the end of 1941 price
control came into operation on a dominion-wide basis, and it is stated
that the milk industry was then in a position where production costs, plant
costs, and distribution costs had materiallv increased without comparable
increases in the price of the product sold.
ECONOMIES IN TRADE PRACTICES
Under the pressure of this situation and initially at the instance of the
Wartime Prices and Trade Board, certain economies which had been
discussed by the Board since its inception, but which had never been acted
upon by the industry, were adopted, apparently with general consent.
The changes were worked out by consultation with the distributing cjid
of the industry, and the following table sets out exactly what was done:
"July 1,1941:
Special deliveries eliminated.
February 1, 1942:
(a) Cream sales limited to two grades.
(b) Cream containers limited to two sizes.
(c) Store returns eliminated.
(d) Delivery service limited to one per day and to regular whole-
sale accounts.
(e) Special bottle caps eliminated.
July 3. 1942:
(a) Charge milk bottle made universal.
(b) Retail sales established on a cash basis.
(c) Wholesale credit sales reduced."
The Board also found itself in the position, where, as it expressed it in
one report, it had a new field of service, namely, the interpretation to the
Wartime Prices and Trade Board of the opinions and needs of the producers
and distributors, and in turn the interpretation to the industry of the rulings
and opinions of the Wartime Prices and Trade Board.
In 1942 subsidies were paid by the Dominion Government, and this added
greatly to the work of the Board's field staff. This additional work was done
without additional staff.
Possibly one of the best ways of setting out the sort of work the Board
did is to take what they themselves set out in their report for the years
1944 and 1945. These reports show the extensive work of inspection and
payment checking carried on, and are as follows:
18 ONTARIO ROYAL COMMISSION ON MILK
1944 1945
Milk samples tested 29,156 25,397
Errors corrected 408 358
Value of errors corrected $1,922.49
Periodic milk receiving reports: (show-
ing methods used for weighing.
sampling, testing, etc.) 375 388
Periodic milk payment reports: (showing
date and accuracy of payment, state-
ments used, etc.) 876 860
Periodic reports on producer-distributor
operations 353
Miscellaneous visits at farms 175
at plants 919
others 201
Special complaints investigated 202
Mileage travelled 100,532 1^14,828
In addition to the routine inspection work shown above, a great deal of
detailed auditing of producer pavments was completed:
1944 1945
Pavment checks made 772 722
Errors corrected, Number 45 39
Value S4893.25 S1L208.79
Producer subsidy claims checked 905 698
Errors corrected, Number 56 13
Value S428.72 S527.54
Consumer subsidy claims checked 982 569
Errors corrected. Number 72 24
Value S4,284.83 Sl,446.88
GENERAL OPINIONS AND CONCLUSIONS
It is apparent, I think, that the Board set itself certain limited objectives
and that in a fair measure these have been achieved successfuUv. Problems
affecting the economies of distribution and the necessity of ascertaining the
actual costs of distribution were fully recognized by the Board, but even
yet, I think, it may be fairly said that no comprehensive studv has been set
up which affords a basis for accurately and readily determining these
important facts.
Similarly, the position of the producers is equally obscure. Apart from the
studies made by Mr. H. R. Hare, and which were concluded in 1939, the
Board has little information, in mv opinion, as to actual producer costs.
The result of this situation will be gone into more thoroughly in the
( hapters dealing with the position of the producers and the position of the
distributors later in this report. Nevertheless, if controls are to be exercised
or enlarged, it is surely essential to find out, as a basis for any price
determination, what the actual costs involved are.
This statement is not necessarily a criticism of the Board as it piesentlv
exists. It may well be that with the staff and equipment at its command,
effective studies of this sort were not practicable.
It would seem to me. however, very desirable that in future thev should
bo undertaken.
Similarly, if the public are to obtain, as I think they are entitled to obtain
with such a vital product as milk, a good product at the cheapest possible
ONTARIO ROYAL COMMISSION ON MILK 19
price, it is desirable that in an industry in which competition has been
practically eliminated by government regulations, any further steps which
may tend to cheapen the costs of handling the product should not merely be
suggested to the industry but should be demanded of them as part of the
price they pay for the protection they are receiving.
As will appear from the chapter on the position of the distributors, the
accounting practices in the distributing end of the fluid milk industry are
varied and in many cases obscure. If prices are to be fixed to the public,
it is surely desirable that some uniform system of accounting should be
pressed on the industry, which will enable the government agency regulat-
ing the industry to readily understand the position at any time when it is
deemed necessary to have such understanding.
These, however, are matters which possibly the Board should now enlarge
its policies to include. In summarizing its work and administration to date,
I am of the opinion that while a fairly rigid industry has been set up to which
entry by outsiders has been generally denied, the rationalization of prices
which was hoped could be achieved when the Act was passed in 1934 has in
the main been realized. Prices much more satisfactory than those previously
obtaining have been obtained for producers. Steps have been taken which
enable them to be reasonably sure of payment for their product and the
price of the product to the public has been fixed to the distributor so that he
knows with some certainty the spread on which he has to operate.
As I stated before, the number of persons in the business has been
drastically curtailed and for practical purposes new entries have been
eliminated.
As will appear from the subsequent chapter on the regulations affecting
milk, fluid milk as a food product sold to the public has become virtually
irandardi^ed, and in the result I think it can be said that the only field of
competition left within the industry is one concerning the service W'hich
they can render to the public.
These results have been achieved, not by forcing them on the public,
but by a continuous pressure which apparently at no time has become too
insistent, and in the result the present situation has been achieved primarily
by agreement of the larger part of the industry itself.
In view of the present costs of fluid milk, however, it may be questioned
whether this process of letting nature take its course can be pursued with
the same devotion, and it would seem to me that the work and scope of the
Board should now be liberalized and enlarged.
To date the prices arrived at both for producers and distributors have been
candidly guess work. The fact that the guess w^ork has been moderately
successful does not, I think, alter the fundamental nature of the situation.
To illustrate, it became apparent quite early in the enquiry that there is a
very great variation between the costs of various producers. These arise
from many factors, such as crop growing; conditions, fertility of the pro-
ducers' farms, cost and efficiency of labour, weather conditions insofar as
they affect feed grain supplies on the producer's farm, efficiency of herd
management, costs of purchased feed, and the geographic situation in which
I be producer finds himself in relation to his market. It is obvious, I think,
that the best that can be done in the wav of fixins prices for the producer,
is to attain a figure which will give an efficient pro<^;ucer a reasonable reward
for his efforts but \\\\\ still encourage the not -i efficient producer. This is
essential if a continuous and adequate supply of fluid milk is to be obtained
in any market.
What has to be done of necessity is to fix an average price taking costs
20 ONTARIO ROYAL COMMISSION ON MILK
on a wide scale and finding a middle price somewhere which gives a reason-
ably efficient farmer a fair return.
It was quite apparent from the evidence before me that despite the efforts
of producers to assess their costs, in many cases such costs were prepared
under tutelage for the purposes of the enquiry, and that certainly before the
enquiry the farmer in question had no real idea of the cost of producing one
hundred pounds of milk. There is undoubtedly an obligation on a class
of producers whose price is fixed on a basis which will give them a fair
return, to produce their product as economically as possible, if they are
going to receive the continued protection of government authority. It would
be desirable if. as a class, producers knew more accurately what their
costs were.
As will appear, however, in the section of this report dealing with pro-
ducers, the difficulties of dairy farming in the last five or six years have been
enormous. Costs have been constantly fluctuating and on the whole have
been steadily increasing. Nevertheless it is, I think, fair to say that neither
the Milk Control Board nor the individual producers at any time have had
sufficiently accurate information on which to base any opinion as to cost. As
will appear later, certain very valuable studies were conducted up to the
outbreak of war under the auspices of the Dominion Department of Agricul-
ture, by Mr. H. R. Hare, of that department, and his study of four years
milk production in Ontario was constantly referred to by the producers before
me. Nevertheless, I think Mr. Hare would be the first to recognize that the
elements entering into producers' costs are so variable and so fluctuating,
that it is impossible to use a study completed in 1939 as an accurate guide
to the determination of such costs at the present time.
The factors entering into the determination of the producers' costs even as
I have enumerated them, obviously are subject to many changes from year to
year. For example, there may be improvements in methods such as improv-
ing pasturage, improvement in feeds and feeding methods, an increase in the
production per cow and for the whole herd: all these things may change the
relationship of the results found by Mr. Hare in 1939, and some continuous
study of producer's costs would seem to be a primary necessity for anv milk
control board in the future. There are a number of ways in which this
could be done and these will be dealt with later in the chapter relating to
producer costs, but a study, even on a very limited scale, should undoubtedly
be undertaken.
\^Tiile the principle enunciated by the Milk Control Board in its 1939
report of letting the industry regulate itself, was, I think, from their view-
point at that time, a sound one, nevertheless under the conditions I have
found any costs set forth by the producers must have been more or less
guess work.
On the other hand, despite the great variation in cost between the various
distributors, which will be alluded to later, it is fair, I think, to say that as a
class the distributors are in a much better position to know their costs, and
consequently one must observe that the bargaining that took place was very
heavily loaded in favour of the distributors. It is amazing that it has worked
as well as it has.
The only possible basis for determining producers' costs is a continuous
study with a fairly wide sampling of producers' costs from year to year
across the province. It is recognized that as between say, Northern Ontario
and Southern Ontario, there are certain very drastic differences, but no one
year is a safe guide to the determination of such costs which depend on such
ONTARIO ROYAL COMMISSION ON MILK 21
factors as good or bad crops, the freight rates on Western feeds, and the
price of farm labour.
It would, therefore, seem desirable that the Board be permitted to set up
and conduct a comprehensive and continuous study of producers' costs over
a period of vears. A need for this was recognized in the early years of the
Board's operations, but owing to changes of personnel and probably to the
pressure of great demands on a small staff very little appears to have been
done.
In stating this I do not wish to seem to be criticizing the Board adversely.
It has been asked to administer and regulate a very substantial industry
in the province, with a very small staff, and there is a limit to what human
flesh and blood can do. but affairs have now reached a stage where it would
seem most desirable that the work of the Board be enlarged and its own
work, if I may say so, rationalized by setting up a proper basis for the
determination of producers' costs.
The remarks above in respect of producers' costs apply in a somewhat
more limited way to distributors. If the distributors are to continue to enjoy
the benefits of fixed prices, not only for the purchase of their raw product
but for the sale of their product, prices presumably must be fixed on a
basis which allow a reasonably efficient distributor to continue in business
whether his volume be large or small. It should also be based, not on guess
work or a somewhat superficial examination of financial statements, which
frequently I fear conceal more than thev reveal, but should rather be based
on a uniform system of accounting which all distributors should be required
to maintain, and a continuous studv of such accounting from year to year.
If price fixing is to continue, this is the only rational basis on which to
carry it on.
While it is specially important to secure accurate estimates of production
and distribution costs, there are several other types of information which
the Board should undertake to obtain and keep up to date if it is to be in a
position to reach intelligent decisions in respect to prices. Any price establish-
ed is likely to prove satisfactory to the extent that it reflects the supply and
demand conditions which actuallv exist and. better still, the conditions which
are apt to prevail during the period in which the price is expected to be
operative. This suggests that any agency responsible for price determination
should have as complete knowledge as possible of the direction and extent
of the trends of the various factors which go to make up the supply and
demand situation. A few examples may serve to indicate the specific nature
of the information that is required.
ESSENTIAL STATISTICAL DATA
One of the things most needed is a series of indexes showing the latest
developments and the general trends in the conditions of both agriculture
and industry. More specifically the statistical information should show the
general level of prices being paid by farmers for goods purchased by them,
the general level of farm selling prices, the general relationship between the
prices being paid and those being received by farmers, i.e. the situation in
respect of farm purchasing power, the provincial farm income in general and
that of dairv farming in particular, the existing stocks and production of the
various kinds of hay and feed grains, the average prices received bv farmers
for the various home grown feeds, the average prices of the several types
of purchased feeds, the average wages paid to hired farm labour, dairv cow
and heifer numbers, and pasture conditions. In the same way it should
22 ONTARIO ROYAL COMMISSION ON MILK
include an index of the cost of goods bought by wage earners and lower
salaried workers, an index of industrial employment or unemployment, and
one designed to show the size of the industrial pay roll.
Another type of statistical data should relate to the general dairy price
situation. In addition to the official whole milk prices it should show the
average price actually received by whole milk shippers, i.e. the prices
resulting when sales at surplus prices have to be considered along with those
at the regular or quota price, the price of fluid cream, condensery products,
cheese and creamery butter, the average prices received by farmers for milk
sent to the condenseries, cheese factories and creameries and tht differentials
between these prices and those obtained for whole milk. Still aiiother set of
statistics should be provided to give a detailed picture of the situation in
respect of whole milk production and consumption. They would show the
total amount of milk going to all whole milk markets in the province,
the amount going to each of the larger markets, the amount finally consumed
as fluid milk in the province and also in the larger markets, the amount
for which producers were paid surplus prices, the amount sold by distribu-
tors at wholesale and at retail, the degree of regularity of production, the
actual number of producers and any ret changes in the number. It might
also be desirable to maintain maps showing the location and population
of each of the more important markets together with the location and number
of producers who supply these markets.
Information of the various types just indicated would provide a basic
background in the light of which the price-making decisions of the Milk
Control Board could be made with a reasonable degree of confidence.
As in the case of the information relative to cost of production and distri-
bution, it would serve not as a final or sole determinant but as a very useful
guide. In those cases where necessary statistics are already being collected
bv other governmental agencies, steps should be taken to secure and arrange
them in the form best suited to the Board's requirements. Where the statistics
themselves are non-existent, the Board should undertake the responsibility
of securing them. Wliile this sphere of activity might require a considerable
expansion in the number of Board employees and the addition of some
employees with special skill along statistical lines, such a development would
appear to be necessarv if anything in the nature of scientific price determina-
tion is to be undertaken. A good idea of the kind of information required
can be obtained by examining the Compilation of Statistical Material pre-
pared bv the Dairy Division of the Surplus Marketing Administration of the
United States Department of Agriculture. A recent issue of this material as it
relates to the Chicago Marketing Area may be found in Appendix 8 to
this report.
CONSUMER REPRESENTATION
One cannot go through the various reports of the various Milk Control
Boards without realizing that they were very conscious of their obligations
to protect the public, and by and large I think that result has been achieved
by them. It has not, however, arisen out of the provision for consumer
representation as presently provided by the Act.
Almost without exception in the evidence before me the consumer repre-
sentative suggested that at no time w^ere the facts and records in the possession
of the Board revealed to them when they were asked to sit in on the fixing
of prices in the market in which thev represented the consuming public. They
were in practice, it would appear, left on the outside rather than taken into
the Board's confidence in that respect. This proceeding, if consumer repre-
ONTARIO ROYAL COMMISSION ON MILK 23
sentation is to mean anything at all, seems utterly irrational and fantastic,
it was said that a great deal of the information was confidential, but it is
surely quite possible to see that consumer representatives are sworn to secrecy
in the matter and treat them with the responsibility which their position
warrants. There was no actual evidence before me which would suggest
consumer representatives as they existed were unworthy of that trust and
confidence.
Normally in a Board of this kind the Board has been made up of a Chair-
man, presumably independent, a representative of the producers and a repre-
sentative of the distributors as a group. The proper function of the Chairman
of the Board would appear to be that of an independent person whose chief
function was to represent the public interest for which the government
appointing him is responsible.
Suggestions were made particularly by consumer representatives before
me that there should be special consumer representation, and certain of the
trade union representatives thought organized labour, apart from other con-
sumer groups, should receive special toiisiderahon.
Unless the Board is to become completely unwieldly, it would not seem to
me to be possible to differentiate between the various consumer interests in
the community. They all have a common interest, and while it might seem
desirable than an independent person representing the consumer interest be
added to the Board, it would probablv be safer to put that dutv squarely on
the Chairman's shoulders.
The only danger resulting from this is that in the course of time anv
person in his position is apt to become so familiar with the needs of the
industry as such, and so involved in attempting to regulate it. that the special
interests of the public may at times be overlooked. If this is the case, it
might be advisable to appoint a consumer representative who would ideally
be a person capable of reading and understanding not onlv companv's
statements but studies of producer's costs. It was said that a four-man Board
would be unwieldy. I do not know, however, if in practice this would
necessarily be so. and such a Board might find considerable public approval,
and it is very hard to argue strenuouslv against it.
In concluding my observations on the administration of the Milk Control
Board under the Milk Control Act I do not wish at this stage to make any
recommendations, as these will depend to a considerable degree on the
recommendations arrived at after study has been made of the position of
the producers and distributors respectively. I propose, therefore, to make
recommendations in respect to the Milk Control Board as part of the general
conclusions and recommendations at the end of the report.
I would not like to conclude the review of the administration of the Milk
Control Board, however, without paying tribute to the patience and courtesy
of Mr. C. M. Meek, the present Chairman of the Board. No one has been
more obliging and helpful to the Commission under what at times must have
been trving circumstances, than has Mr. Meek. He has loyally endeavoured
to supply all the information asked, and has been most co-operative through-
out the enquiry.
It was impossible not to be impressed by his conscientious regard for his
duties and his desire to do what he deemed best in the somewhat difficult
task for which he is responsible. I would like to express my thanks of those
associated with me for the helpful assistance he has given me.
24 ONTARIO ROYAL COMMISSION OX MILK
CHAPTER IV
Legislation Peculiarly Applicable to the
Dairy Industry in Ontario
Apart from The Milk Control Act ( R.S.O. 1937, Chap. 76), there are
three Dominion Statutes, three Dominion Orders-in-Council, nine Provincial
Statutes, a plethora of municipal by-laws, and extensive regulations appur-
tenant to most of the statutes all directly applicable to the dairy industry in
the Province of Ontario, in one way or another. The Commission was
fortunate in having the evidence of James C. Hay, Esq., Solicitor for the
Department of Agriculture. Ontario, to assist it in considering this mass
of legislation. Mr. Hay also prepared a brief containing the various acts,
regulations and sample municipal by-laws which has been invaluable in
reducing the legislation to a form in which it can be readily considered.
Dominion Legislation :
(a) The Dairy Industry Act, R.S.C. 1927 I Chap. 451 and Regulations-
made thereunder.
This Act is designed to impose a uniform dominion-wide stan-
dard of manufacturing, inspection, grading, marking and packag-
ing for sale of dairy products, but most particularly butter and
cheese.
All cheese factories and creameries are required to register
with the Dairy Products Division of the Dominion Department of
Agriculture and cheese and butter produced by such plants is
inspected and graded by officials appointed under the Act and
Regulations.
The chief purpose of the Act is to control grades, marking and
packaging of butter and cheese. In addition the Act prohibits the
manufacture, importing or selling of oleomargarine or any other
butter substitute.
(b) The Cheese and Cheese Factory Improvement Act, Statutes of
Canada (1939j Chap. 12 and Regulations made thereunder.
There are two objects of this Act. first, to encourage the reduc-
tion in the total number of cheese factories, by authorizing grants
up to 50% of the cost of constructing any cheese factory of proper
design, etc.. which is being built to replace two or more factories,
and secondly to encourage the highest quality of Cheddar cheese
by paying a premium out of consolidated revenue of one cent to
two cents per pound for highest grades.
(c) The Food and Drugs Act (R.S.C. 1927, Chap. 76)
The regulations passed under this Act contain definitions, applic-
able throughout the Dominion of milk products processed for
human consumption, and hence set uniform minimum standards
for such products,
(d) Orders-in-Council.
The various Dominion Orders-in-Council were the product of
wartime emergency and provided for the payment of certain
ONTARIO ROYAL COMMISSION ON MILK 25
subsidies and the elemination of trade practices that tended to be
wasteful of commodities in extremely short supply.
Province of Ontario Legislation
In addition to The Milk Control Act, which is dealt with in detail elsewhere
in this report, Provincial Legislation in this Province has been enacted
under four main heads. These, with the relevant legislation, are as follows:
I. CHEESE MANUFACTURE
(a) The Cheese and Hog Subsidy Act, Statutes of Ontario (1941)
Chap. 11.
This Act authorizes the payment of a two cent per pound
Provincial Producer subsidy for cheese. The Act is for one year's
duration, but has been renewed annually to date, and is supple-
mentary to the Dominion Cheese and Cheese Factory Improvement
Act.
(b) The Consolidated Cheese Factories Act, R.S.O. 1937, Chap. 87.
This Act, like its Dominion counterpart, provides for generous
loans for the construction of cheese factories to replace two or more
old ones and having a very substantial output. It is designed to
assist in the reduction of processing costs in the manufacture of
Cheddar cheese by stimulating mass production to assist the pro-
ducers in getting an adequate return for their milk.
II. PUBLIC HEALTH
(a) The Public Health Act, R.S.O. (1937). Chap. 229.
This Act applies particularly to fluid milk insofar as it deals with
compulsory pasteurization, and the minimum sanitary require-
ments for pasteurizing plants. Compulsory pasteurization is in
force in most areas in Ontario and the regulations dealing with
plants are very elaborate.
The Act also makes general provision for the condemning of
food unfit for human consumption and provides penalties for its
distribution, sale or possession.
(b) The Milk and Cream Act, R.S.O. 1937, Chap. 302.
This Act authorizes all municipalities except counties to pass
by-laws to control the quality of milk and cream offered for sale
within its boundaries and for the licensing of vendors of such
products. The Act provides that municipalities may regulate the
minimum butter-fat and solid content of milk and cream but
prohibits the sale of cream of less than 16 per cent butter-fat and
milk of less than 3.25 per cent butter-fat. This latter provision is
inconsistent with the views of nutritional experts — see particularly
the evidence of Dr. Tisdall and Dr. Pett, Appendix 2 — and should
receive careful consideration with a view to revision.
(c) The Dairy Products Act 1938, St. of Ont. 1938, Chap. 7.
This Act and its regulations control the construction and opera-
tion of cheese-factories, creameries, condenseries, milk concentrating
and milk separating plants. It provides for the licensing of such
plants, and the examining and licensing of cheese-makers, butter-
makers, etc.
The whole Act is under the direction of a Director of Dairying
and is specifically designed to ensure a very high standard of
dairy product in the Province of Ontario.
26 ONTARIO ROYAL COMMISSION 0\ MILK
III. TRANSPORTATION
The Commercial Vehicle Act, R.S.O. 1937, Chap. 290.
This Act and its regulations govern the transportation for hire of
persons and goods, in the Province of Ontario, including raw milk
from producer to processor. A farmer or group of farmers jointly,
owning a truck, do not need a P.C.V. license to haul their own
product, but if a farmer hauls for his neighbour or neighbours, he
comes under the Act.
An applicant for a license to haul milk for hire must appear
before the Municipal Board, prepared to show that the service he
offers is necessary in the community. The Producers' Association,
Milk Control Board, and any local Transport Associations are given
an opportunity to appear also and approve or oppose the application.
If the applicant can establish public necessity and convenience, he
will probably receive his license.
In this connection it is to be noted that in the markets of Toronto,
Hamilton and Guelph there are very strong Milk Transport Asso-
ciations who have entered into agreements for routes and rates
with Producer and Distributor Associations and under the eyes of
the Milk Control Board with a view to bringing some measure of
control by the industry itself with respect to transportation in
these areas.
IV. MARKETING
(a) The Farm Products Grades and Sales Act, R.S.O. (1937) , Chap. 307.
This Provincial Statute is to some extent a duplication of the
Dominion Dairy Industry Act in that it sets up standards for cheese
and butter and makes specific provision for grading, marking,
inspection and enforcement by Provincial personnel. It does not
conflict with the Dominion Act, in that the grades are the same
and arrived at in the same way. The Act is of wider application
than the Dominion legislation, in that it may be extended by
regulation to include every type of farm product. At present the
Regulations only extend to Dairy Products.
(b) The Co-Operative Marketing Loan Act, R.S.O. 1937, Chap. 85.
This Act is designed to provide financial assistance to groups
of producers in erecting facilities for grading, packing, storing,
cleaning, drying, processing and marketing of farm products. For
purposes other than cold-storage plants, the maximum sum that
may be loaned is S15,000, but for cold storage plants the amount
shall be up to 509f of the value of the property and plant up to a
maximum loan of $65,000.00. This is in essence another act to
assist the primary producer to secure the maximum share of the
ultimate consumer's dollar, and of course is applicable in its terms
to virtually every phase of the dairy industry.
(c) The Farm Products Marketing Act, 1946, St. of Ont. Chap. 29.
This Act replaced the Farm Products Control Act of 1938 and
is designed to provide a legal means for farmers to set, under the
authority of Provincial Law, prices for farm products. Each
product, brought under the Act by the adoption of a scheme, is,
thenceforth, a regulated product, and strong powers are provided
to maintain any price structure adopted.
The mechanics of the Act involve first of all an association of
ONTARIO ROYAL COMMISSION ON MILK 27
producers, then a scheme providing for the creation of a local
marketing board, and finally the vesting of appropriate powers in
such board. The whole scheme as propounded must be approved
by the Minister of Agriculture and duly promulgated.
At the present time ten such schemes have been approved, namely,
I. The Ontario Cheese Producers' Marketing Scheme.
II. The Ontario Seed Corn Growers' Marketing Scheme.
III. The Ontario Asparagus Growers' Marketing-for-Processing
Scheme.
IV. The Ontario Bean Growers' Marketing Scheme.
V. The Ontario Berry Growers' Marketing Scheme.
VI. The Ontario Pear, Plum and Cherry Growers' Marketing-for-
Processing Scheme.
VII. The Ontario Vegetable Growers' Marketing-for-Processing
Scheme.
VIII. The Ontario Peach Growers' Marketing - for - Processing
Scheme.
IX. The Ontario Sugar Beet Growers' Marketing-for-Processing
Scheme.
X. The Ontario Hog Producers' Marketing Scheme.
There are others in the process of drafting and consideration, but an
examination of those approved, leads immediately to the observation that
the product regulated, — in all cases — is capable of a certain time of storage
pending marketing. It would appear that products which are susceptible to
regulation by this Act must have this quality in order to give local boards
a little time to negotiate sales and to permit handling.
This essential characteristic, while shared by many dairy products after
processing, is peculiarly not a characteristic of fluid milk in its raw state.
Similarly, the markets for fluid milk in the raw state overlap each other to
a very great degree, particularly in south-central and south-western Ontario,
— with the result that no local board could be appointed that could reasonably
deal with this particular product in any locality. As an illustration of the
problem to be faced, some milk, destined for the fluid milk trade in Toronto,
comes from the shores of Lake Huron every day, — and every county in
between has its quota of shippers to the Toronto Milk Shed.
There has been some suggestion that this particular Act might usefully be
employed in the marketing of raw milk, and therefore the matter has been
discussed at some length, to bring out the important points which in my
view render it inapplicable to this particular product.
Municipal Legislation
Under the Milk and Cream Act, R.S.O. 1937, Chap. 302, authorized
municipalities have passed regulatory by-laws dealing with the marketing
of these products within the municipality. A typical by-law is that of the
City of Brantford, which appears as Appendix 9.
ORGANIZATION OF THE DAIRY INDUSTRY IN ONTARIO
As will be seen from the more detailed discussion of the associations
which have been formed by various groups of persons engaged in the dairy
industry in Ontario, the whole industry has in comparatively recent times
become strongly organized in representative associations. There is no doubt
28 ONTAIUO ROYAL COMMISSION ON MILK
that these associations have contributed much to the progress and develop-
ment of the industry, and there is every reason to expect that in the future
they will continue to exercise their influence for the good, primarily of their
own members, but indirectly and as a consequence for the benefit of the
public at large.
The associations referred to may be listed as follows:
Producers :
(a) The Ontario Whole Milk Producers' League, representing 16.000
producers of whole milk.
(b) The Ontario Concentrated Milk Producers' Association, representing
12,000 producers of milk for condensary purposes.
(c) The Ontario Cheese Producers' Association, representing 25,000
producers of milk for manufacture into Cheddar cheese.
(d) The Ontario Cream Producers' Association, representing upwards of
76,000 producers of cream for manufacture into butter.
Distributors and Manufacturers:
(a) The Ontario Whole Milk Distributors' Association, representing 400
processors and distributors of fluid milk, comprising over 75% of
the total business in the Province.
(b) The Ontario Creamery Association, representing 221 out of 279
manufacturers of creamery butter in Ontario, and producing 88%
of the creamery butter made in the Province.
A more detailed discussion of the organization and operation of these
associations is set out in the chapters relating to producers and distributors
respectively, but for ready reference it was thought desirable to list all the
associations at this point.
ONTARIO ROYAL COMMISSION ON MILK 29
CHAPTER V
Production and the Position
of the Producer
The position of the producers as to the prices paid them for fluid milk was
placed entirely on the ground of cost in the evidence before me. It was not
until the concluding sessions of the enquiry that they apparently took into
consideration the question of consumer demand particularly as it was con-
ditioned by the price charged to the consuming public. What the producer
can get for his milk in the fluid market is, of course, very directly governed
by the consumer demand and by the prices the consumers are willing to pay
for the product. In determining what a fair price to the consumer is, there-
fore, the producer should never lose sight of these hard facts and irrespective
of his cost what he can get for his milk must inevitably be influenced in part
by the other factors I have mentioned.
At the same time the producers as a class should not lose sight of the fact
that these other conditions may from time to time be altered not only by
the general level of income of the consuming public but by education and
propaganda among the consuming public as to the advisability of giving
milk a larger place in its diet. Thev should also never lose sight of the fact
that after all the basic condition of large quantity consumption of milk is
low price.
Until the producers as a class put themselves in the position where they
can eff'ectively make the consuming public understand the full implications
of their position, there is little real hope of convincing the public of the
necessity of paying a retail price for milk corresponding with their reasonable
costs of production. Efforts along these lines have been made through the
establishing of Milk Foundations which have accomplished considerable in
this direction. It would appear that much more must be done, and that the
nature of the operation carried on by the dairy farmer and the conditions
under which he works should be made more plain to the consuming public.
The Organization of the Producers' Part of the Dairy Industry in Ontario
Development, control and regulation of the dairy industry in Ontario
insofar as the application of the Milk Control Act is concerned, has been
very considerablv facilitated bv the existence of strong and representative
associations of some of the major groups involved in milk production.
The Ontario Whole Milk Producers' League is an incorporated body
bavins; approximately 16.000 producers of whole milk in the Province of
Ontario in its membership. In area it is province-wide and all but a negligible
number of the farms producing fluid milk for consumption in the Province
of Ontario are members of this league.
The league functions mainly through seventy-three local associations which
are to a degree independent organizations operating under the general
supervision of the parent body. The authoritv of these locals is particularlv
important with respect to the negotiating of prices, the establi'shment of
quotas and the provision of outlets for the product of the individual members.
The Ontario Concentrated Milk Producers' Association is also incorporated
under the Agricultural Societies Act and has a membership of approximately
30 ONTARIO ROYAL COMMISSION 0.\ MILK
12,000 producers concentrated mainly in the southwestern and southeastern
parts of the province. There are between one and two thousand producers
of milk for concentration who are not members of the association but who
no doubt share in any benefits which the association may bring about. The
members of this association produce fluid milk for delivery to condensaries
where milk is processed into various commodities.
Like the Ontario Whole Milk Producers' League, this association operates
to a large degree through twenty-nine local associations who enjoy a sub-
stantial measure of independence with respect to the negotiating of contracts
and securing of outlets for the product of their members. There may be
some overlapping in membership between the league and this association in
that some members of the league may ship to condensaries surplus milk
during flush seasons.
The Ontario Cheese Producers' Association represents approximately
25,000 producers of milk in the Province of Ontario whose milk is delivered
to cheese factories and manufactured into Cheddar cheese. Very few pro-
ducers of milk for this purpose are not members of the association. The
Provincial Association is divided into five areas which are represented on a
provincial board of directors and each area in turn has a county association
for each county in the area.
Ninety-five per cent of all cheese factories in Ontario are either owned by
producers supplying milk to be processed or are owned and operated by a
qualified cheese maker. There are upwards of 570 cheese factories in these
two categories, and the remaining 30 to 40 cheese factories are owned by large
companies such as the Kraft Company which manufactures in the main
processed cheese as opposed to the Ontario Cheddar cheese.
This association is very largely concerned with the marketing of the
finished product, under the Dominion Dairy Industry Act and the Ontario
Farm Products Marketing Act. So important is this part of the association's
\\ork that it caused a company known as the Ontario Cheese Producers
Limited to be incorporated for the express purpose of acting as a marketing
agency.
The Ontario Cream Producers' Association is an unincorporated associa-
tion which Avas only initially organized in October, 1946. While very new,
it claims to be representative of upwards of 76,000 producers of cream for
the manufacture of butter in the Province of Ontario. One of the chief
objects of this association is the formulation and approval of a marketing
scheme under the Farm Products Marketing Act.
While not directly a part of production, the transporting of fluid milk is of
great importance to the position of the producers. There is no provincial-
wnde association of persons engaged in the transporting of fluid milk from
producer to distributor, but there are three substantial local transport
associations, namely Toronto. Hamilton and Guelph, who have been suffici-
ently successful in organizing to negoti9te contracts which have resulted
in a substantial measure of control over the haulage of milk into these
markets, and so much so that the Milk Control Board and the Department
of Highways and the Municipal Board are able to deal with these local
associations as thoroughly representative of the market.
The Ontario Creamery Association, organized in 1917, is an unincor-
porated trade association representing 221 of the 279 creameries in Ontario.
The members of the association produced, in 1945, 88 j>er cent of the creamery
butter made in the Province of Ontario. This association, therefore, is
clearly qualified to speak for the industry, and it has, on occasion, made
appropriate representations, with respect to prices and marketing, and its
ONTARIO ROYAL COMMISSION ON MILK 31
very existence is of great value in the enforcement of legislation with
respect to manufacture and grading.
The Producers
As appears elsewhere, the producers of whole milk are by and large
chiefly members of an association known as the Ontario Whole Milk Pro-
ducers' League. All producers of fluid milk are not necessarilv members of
this trade association, but it can be fairly said that the greater number of
them are, and it is thoroughly representative of the producer and of the
industry.
The purposes and objects of the league are numerous, but there are three
expressed in its charter which it has pursued rather vigorously. These are:
"(a) To improve and maintain the standard of milk, cream, and all dairy
products.
(b) To co-operate with any other organization or organizations.
(c) To co-operate with any person, firm, corporation or governmental
body in the preparation and carrying out of regulations for the
purposes aforesaid."
It has acted generally for its members in connection with hearings before
the Milk Control Board and submissions to the Wartime Prices and Trade
Board.
In membership it is divided into local associations of which a list is set
out in Appendix 10, and it was stated to me that each local was entitled to
nominate directors to serve on the board of the league. If the membership
of a local association is two hundred or less, one director is nominated. If it
is larger than that the local nominates one director for the first two hundred
and one director for each additional five hundred members or part thereof.
The annual meetings are composed of delegates nominated by the local
association and the actual direction of the league is conducted by eleven
members appointed by the delegates in attendance at the annual meeting.
The local associations are semi-independent organizations functioning on
their own responsibility as to local problems. The general or provincial
association is merely a co-operative association of the various locals and is
concerned with matters of interest to the members as a W'hole.
It was said that the league has been recognized bv the Dominion and
Provincial Governments and the Milk Control Board, and is fully representa-
tive of producers in the fluid milk field. I think it can be fairlv said that the
producers of fluid milk are looked on as being among the most pro-
gressive, well organized and prosperous elements in the farming community
of Ontario. Their lot, however, is not entirely a happy one and they have
many problems and troubles affecting the operation of their business as
well as being under the necessity of a constant and unremitting attention to
their dairy herds. As one of the witnesses appearing before me at London
said, the secret of successful dairy farming is herd management, and this
unquestionably calls for constant and continuous care and attention.
Mr, Douglas Hart, who is looked upon as one of the most successful dairy
farmers and breeders of dairy cattle in the province, and who carries on a
very large and successful operation in Oxford County, stated in evidence
that despite a large number of employees he found itnecessarv himself to
work anywhere from sixteen to eighteen hours a day. As he put it. it was
not that the work was so hard but that it was long and that constant attention
to It was necessary if success was to be assured.
Many producers find that they must not onlv work themselves but must
32 ONTARIO ROYAL COMMISSION ON MILK
call on their wives and children to do a substantial part of the work in
connection with the production of fluid milk. A brief on the trials of a
dairy farmer's wife, which at first blush may seem somewhat of an exaggera-
tion, was presented by a representative of the Women's Institute in Carleton
County in the Ottawa Valley. A sober consideration of the evidence as I have
heard it convinced me that this statement does not exaggerate the true
state of affairs and I am accordingly setting it forth in Appendix 11. I am
convinced from the evidence that there are countless farm wives in Ontario
who would find it a verv truthful statement of the conditions under which
they have to carry on.
The principal problem of the producer has been in essence a financial one,
that is. to obtain a fair return for his product. In its result, however, it is
not so limited but has many general social aspects which must call for con-
sideration if a reasonable standard of life is to be preserved among the milk
producers of the province.
It would appear to me, to put the matter shortly, that the farmer producing
fluid milk for consumption in towns and cities of the province is as much
entitled to a fair return for his work as a consumer who works in a factory
or an office. If up to the present time, through lack of sufficiently effective
organization, he has not been able to make his demands felt, that is not a
reason for asking him to produce milk for the fluid market at prices less than
his cost plus a reasonable profit. He is primarilv entitled to the costs of
producing milk and to a fair profit on that labour.
This is a point of view that must be seriouslv considered and maintained if
the farming population of this province are to have a fair share of the general
income produced and if adequate supplies of milk are to be available for
consumption by urban populations. In saying this I quite recognize the fact
that there is an obligation on the producer to take steps to learn how to
produce milk as cheaply as possible, if he has to have the benefit of
governmental protection and intervention on his behalf. He must recognize
that he is under an obligation to produce high qualitv milk as cheaply as he
can. and it cannot always be said that this obligation has been fully
recoenized.
There is also the other consideration previouslv mentioned that no matter
what the cost of production, there is a maximum price above which milk
consumotion will diminish and if this fact is fullv recognized bv the pro-
ducers it might operate to produce more efficient production methods and
better herd management in the long run. It is unquestionably true that low
cost milk means high consumption, and low cost milk is the goal to which
the prf ducer should be constantly bending his efforts.
Milk production, of course, is not confined to production for the fluid
milk market. As has been stated earlier in this report, milk is also produced
on the farms of Ontario for cheese factories, condensaries. and by far the
greater number of farmers in Ontario selling milk products sell cream to
creameries for the production of butter.
The problems affecting the production of milk for condensaries. creamer-
ies and cheese factories will be considered separately. In this chapter I am
limiting the discussion to the position of those producing milk for the fluid
milk market for consumption by the urban populations of the province. The
word urban, of course, includes villages as well as the towns and cities.
Insofar as the fluid milk producers as a group are concerned, their degree
of specialization varies verv widely. At one end of the scale vou have a
farmer who produces for the fluid milk market with a purebred herd and
who also engages in what is probably more profitable, that is the production
ONTARIO ROYAL COMMISSION ON MILK 33
of animals for breeding purposes. At the the other end of the scale you have
the farmer who probably carries on several farm enterprises, and who
may produce as little as one can of milk per day for the fluid market. There
is the greatest possible range and variation between the producers as such.
As in other aspects of the dairy business, it is unquestionably true that
where there is a variety of enterprises, either the raising of breeding stock
or some other line of farming, there is greater certainty of the average farmer
showing a larger net income from his effort.
As was said by the distributors, however, when this matter was discussed
with them, if a business is to be successful every branch of it should stand
on its own feet and show some profit, even if a small one. It cannot be
said that the producer's business is in a sound position if he cannot show
a reasonable profit on the production of fluid milk as such.
Factors Affecting the Cost of Production
As apears from the chapter dealing with the administration of the Milk
Control Board, sporadic attempts have been made from time to time to
ascertain the cost of producing milk for the fluid market, and for the other
markets into which it flows. The Board itself has never undertaken, as far
as I can ascertain, any very substantial inquirv- but in the late 1930's a joint
survey was undertaken by the Economics Department of the Ontario Agri-
cultural College at Guelph. and the Economics Division of the Dominion
Departure of Agriculture. The study was under the general supervision of
Mr. H. R. Hare of the Dominion Department of Agriculture, and started off
with the co-operation of some 780 farmers who kept records of their business
for the twelve months ending June 30, 1937. It carried on from 1936-37 and
included the year 1939-40. It was not carried on during the war.
The various methods of determining costs of producing fluid milk will
be discussed later in this chapter but the study made under Mr. Hare's
immediate supervision is the onlv serious attempt which has been made in
Ontario, at least in recent times. Whether his calculations are now valid some
eight years after the last cost records were taken is a question which will be
discussed below, but the various factors which affect the cost of producing
fluid milk which he set out still strike me as having considerable validity.
They may be briefly listed as follows: size and fertilitv of farm, size of
milking herd, milk sales per cow, cost of labour and efficiency thereof,
crop yields, feed costs, hauling costs, to mention the most obvious items.
It will readily be seen on any reflection at all that there is a possibilitv
of the greatest variation in these factors as between farm and farm, but
despite this there are certain general considerations which mav throw some
light on the condition of the farmer producing milk for the fluid milk
market. For one thing, it is unquestionably true that the amount of capital
invested by a farmer producing fluid milk is more substantial than that of a
farmer engaging in general farming.
In the case of fluid milk producers, the first part of the capital investment
is represented by the cost of cattle themselves. Over the last six vears this
has increased substantially. Part of this increase is unquestionablv due to
the inflationary conditions existing in the United States where a ready
market for good milk cows has existed. As was stated before me, dairy
cattle exports from Ontario to the United States have greatly increased. In
June, 1946, the number of dairy cattle shipped from this province to the
United States amounted to 4,445 head as comnared with 374 in June of 1939.
During the whole of 1945 exports amounte'd to 26,242 head exported as
agamst 6.537 head in 1939. This increased exportation has increased the
34 ONTARIO ROYAL COMMISSION ON MILK
prices which farmers must pay if they are to obtain good milk cows by way
of purchase. It would also indicate, I think, that selling good milk cows has
in many cases been more profitable than keeping them for the production
of fluid milk at the prices prevailing for that commodity.
The total figures of exports of dairy cattle from Ontario to the United
States for the years 1939 to 1946 are as follows:
1939— 6,537
1940— 8,679
1941 — 14,205 (These figures do not include
1942 — 14,381 cattle from Eastern Ontario
1943 — 19,094 moving through Quebec
1944^19,845 ports.)
1945—26,242
1946—38,292
The evidence before me led me to believe that, en the average, prices had
doubled or even more than doubled during the period under discussion.
It was also quite apparent from the evidence before me that a dairy farmer,
once he commits himself to this type of farming, is committed to it for a
number of years, and that, since a good milk producing herd cannot be built
up in a short time, it is not possible for a dairy farmer to shift readily
to other kinds of farming.
A perusal of the sanitary regulations which farmers producing milk for
the fluid milk market have to comply with and which are indicated in
this report indicate a considerable amount of additional equipment of an
expensive type which the dairy farmer must possess. He unquestionably has
to have more expensive buildings, stables and milk houses than the farmer
who is engaged in general farming. He thus has a much more substantial
amount of fixed capital tied up in his business than farmers pursuing differ-
ent types of farming enterprise. It is true that all farming is essentially a
business involving definite risks such as the vagaries of the weather, pests
and blight and many other uncontrollable factors. In addition to these,
however, the dairy farmer is under the additional risk of losses from the
special dairy cattle diseases which may be, and often are, very serious. It
would appear that the more nearly dairy cows are made to produce to full
capacity the greater is the likelihood of one or other of the diseases develop-
ing among them.
In the brief presented to me by the Hamilton Milk Producers' Association,
which was one of the most thoroughly prepared briefs I received, the follow-
ing statement was made:
"Heavy losses are incurred by dairy farmers due to animal diseases.
These losses comprise a substantial part of the cost of milk production,
and must be met by the price received by producers for whole milk. Dr.
A. L. MacNabb, Principal of the Ontario Veterinary College, an authority
on this subject, has conducted investigational studies on Government
herds to determine the incidence of disease. He estimates the loss to dairy
herds from mastitis infection in Ontario at from ten to fifteen million
dollars and from contagious abortion at twenty million dollars annually.
He states these figures are built on the assumption that there is a five
per cent herd loss annually, and a milk production loss ranging from ten to
fifty per cent. In abortion disease the loss of the calf crop reduces pro-
duction and efficient breeding. The average production life in years of
Ontario dairy cows is six to seven years."
In connection with the average production life in years of a dairy cow in
ONTARIO ROYAL COMMISSION ON MILK 35
Ontario, the general evidence heard by me would make me place it at some-
where less than six or seven years as mentioned above. On the evidence I
heard I would be of the opinion that the effective production life in years of
an average dairy cow, under present day conditions, is closer to four or five
years than to six or seven.
The fluid milk producer is under another obligation which does not
affect farmers producing milk for other markets, and that is the necessity
of maintaining a steady flow of fluid milk. Under natural conditions cows
freshen in the spring and the largest supply of milk is generally available in
the spring and summer months. The fluid milk producer must, however, so
arrange his breeding that he has his cows freshening in all periods of the
year and it is not possible to do this without adding greatly to his expenses
of production.
It may be interesting to note the amount of milk produced from year to
year for the fluid milk market in Ontario. Over the last six or seven years
there has been a most impressive increase in volume. From the evidence
it would appear that this increase has largely resulted from bringing in new
producers rather than from increasing the amount supplied bv each ])ro-
ducer. In this connection the following table may be of some interest:
TOTAL MILK PRODUCED IN ONTARIO FOR FLUID CONSUMPTION
IN LBS.
January 1939 1941 1944 1946
Fluid Sales 100,598.000 131,407,000 144,120,000
Farm Home Consumed . . 41.431.000 36,120,000 41.668,000
May
Fluid Sales 102,924,000 129,576,000 150,081,000
Farm-Home Consumed . . 43,730.000 44.266.000 43,385.000
June
Fluid Sales 100,965,000 128,299,000 144,548.000
Farm-Home Consumed , . 41,284,000 41.155,000 39.904,000
October
Fluid Sales 105,371,000 126,592.000 126,137,000
Farm-Home Consumed . . 40,453,000 41.402.000 43.710,000
Total for year— Fluid Sales. 1,179.675,000 1.223,824,000 1.511,678,000 1,664.338,000
Farm-Home Consumed 492.129,000 489.149,000 498,760,000 506,374,000
Grand Total 1,671,804.090 1.712.973.000 2.010.438.000 2.170.712,000
Figures supplied by D.B.S.
Monthly figures for 1939. not available.
It is interesting to compare these figures with the amount of milk produced
for butter, cheese and concentrated milk in the same period. Tables covering
milk consumed for these purposes and the amount of finished products
recovered are as follows: (in pounds)
1939 1941 1944 194S
Butter
' As Product 102.832,000 100.843,000 82.799.000 76.71 l.COO
As Milk 2.407.304.000 2,360,731,000 1,938.325,000 1.797.339,000
Cheese
As Product 90,130,000 104,174,000 107,684,000 96.106.000
As Milk 1.009.456,000 1,160,436.000 1.206,062,000 1,070,621,000
Concentrated Whole Milk
As Product 100,776,000 119.111.000 126.380,000 128,734,000
As Milk 264,673,000 312,901,000 365,972,000 373,513,000
30 ONTARIO ROYAL COMMISSION ON MILK
It may also be of interest to consider in conjunction with this the total
number of milk cows in Ontario in the years under review. They are as
follows :
1939 1941 1944 1946
1,182,878 1,142,008 1.187,618 1.257.800
A consideration of these two tables discloses not so much an increase in
over-all milk production as a pronounced shift from one product to another
of the milk produced. Of particular significance is the fact that a steadily
increasing percentage of the total has been consumed as fluid milk. It is also
significant that the total amount of milk produced for all purposes over the
period is relatively much greater than the increase in the number of cows.
This clearlv indicates a pronounced increase in productive efficiency on the
part of the farmers.
One cannot peruse the various reports made on the milk industry in Great
Britain without being struck by the similarity between conditions found
there and those in Ontario. I was constantly told by witnesses who should be
in a position to know, that conditions were so dissimilar to ours in Great
Britain that their experience was not a safe guide. Despite this, consideration
of the various reports of committees there establishes a very profound
similarity of essential conditions insofar as producers are concerned.
You are there, of course, dealing particularly since the start of the war
with a condition where there is a scarcitv of fluid milk in relation to the
demand for it existing. That is admittedlv not the case in Ontario today.
Nevertheless, it is obvious that, insofar as fundamentals are concerned, the
problem of the dairy farmer in Great Britain has not been tremendously
diff"erent from that of dairy farmers in Ontario. A very useful guide to
some of the paths along which the producers might develop their section of
the industry can be obtained from a perusal of the various reports prepared
by commissions and committees under the Ministry of Agriculture in Great
Britain during the last ten or twelve vears.
So far in this report I have approached the problem of the producer from
the viewpoint of cost. Cost, however, must be only one of the factors which
enter into the price which may be obtained by the producer for fluid milk.
There is no greater fallacy in industry generally than the naive belief that
price must always be made high enough to cover cost plus a fair profit.
Prices are not and cannot be arrived at in that manner. In the eventual
result they are the outcome of an interaction between supplv and con-
sumer demand for the product in question.
The producer must, of course, try to obtain his cost of production plus
a fair profit. But if he is to obtain this he must continually strive to reduce
his cost. The experience in fluid milk sales since October, while undoubtedly
aff'ected by general increases in the cost of living, would also indicate that.
There appears to be a price limit insofar as the consuming public is
concerned bevond which it will reduce its demand for fluid milk. It mav be
argued that this is unfair, that incomes on the part of the urban population
have increased out of all proportions to those of the agricultural part of the
population, but it is a fact which nevertheless exists and until the producers
can convince the consuming public that they should pay a higher price for
milk there will be the greatest resistance to such a conditio?! of aff^airs. and
the resistance will show in decreased consumption.
The following table shows the amount of fluid milk consumed in Ontario
in the period from January. 1946. to the end of June, 1947, expressed in
quarts:
ONTARIO ROYAL COMIMISSION ON MILK
37
194f
)
1947
January:
38,788,000
January :
36,874.000
February :
36.386,000
February :
34.578,800
March :
40,645,000
March :
37.743,600
April:
39,637,000
April :
36,551.300
May:
41,328,000
May:
37.874.800
June:
39,106,000
June:
36.152.300
July:
41,268,000
August:
40,168.000
September :
38,539,000
October :
37,824,000
November:
37,092,000
December :
36,953,000
Also set out in Appendix 12 is a study furnished me by the Hamilton Milk
Producers' Association which I accept as valid and which shows the increases
in income of urban consumers in the vicinitv of Hamilton and also in Ontario
since 1939. The purpose of this study was. of course, to show that urban
consumers could afford to pay more for milk. Unless they show a greater
willingness to do so than they have in the past, that argument is rather
academic, but it is of assistance in assessing the general position.
Roughly speaking, there was a most impressive increase in the consumption
of fluid milk in Ontario during the war years from 1941 on. With the price
increases in the spring and fall of 1946. that increase was reversed, and
since then there has been a gradual decline. It is quite true that this is
probablv due to the large increase in the general cost of living which has
taken place in that time and milk is only one of several necessary foods all
of which have increased in price to the consumer. Nevertheless, the fact that
this decrease has occurred must indicate very clearly to producers that
there is a limit at the present time, whatever the future niav hold, bevond
which they cannot hope to sell milk in the volume thev have previouslv
sold it.
The following table, which shows the total wholesale and retail commercial
sales of fluid milk in Ontario, expressed in quarts, since 1941. mav be
of interest:
1941 1942 1943 1944 1945 1946
290.089,400 324.948.700 386.734.500 411.963,000 432.857,000 467,736.000
MILK PRODUCTION COSTS, THEIR CALCULATION AND USE
During this enquiry a great deal of consideration has been given to the
cost of producing milk on the farm and matters relating thereto.
There are two main reasons for this. Since one of the chief matters
requiring determination has been the degree of adequacy of the prices
received by producers for their milk, it has been necessary to find some
measuring rod which would enable me to suggest what prices might be con-
sidered necessary and desirable. In searching for such a measure it has
seemed to me that the best and. indeed, the only practicable way of deciding
whether a price was satisfactory or not was to try and discover whether it
was sufficient to cover the costs of production. In saying this I am not
suggesting that prices should always be high enough to cover all costs at all
times. Lender the dynamic conditions which actually prevail and which
result in fairly constant changes in both supply and demand, it is obvious
that prices may be higher or lower than costs at any specific point of time.
38 ONTARIO ROYAL COMMISSION ON MILK
It seems equally obvious, however, that, over any considerable period of time
or in the long run, prices must be at least suflScient to cover all costs of
reasonably efficient producers. Such a cost-price relationship seems necessary
if sufficient milk of desirable quality is to be forthcoming, if the dairy farm
production plant is to be maintained satisfactorily, if dairy farmers and
their families are to enjoy the material standard of living to which they are
entitled, and if a proper economic balance between dairy farmers and other
classes in the population is to be secured and maintained.
These statements will probably suffice to explain why every possible
attempt has been made to obtain reliable cost information and to relate it
to producer prices.
The second reason for studying the producer cost situation is not unrelated
to the first one. It is in the public interest that consumers of milk products
should receive these products at the lowest possible price consistent with the
giving of reasonable remuneration to those who supply them. It is clear
that the possibilities of giving consumers cheaper milk as time goes on must
depend upon the possibilities of reducing costs of production on the farms
as well as the costs of processing and distribution after leaving the farms.
In view of this fact considerable attention has been given to the matter of
production cost trends and, in particular, to policies and programs that might
be expected to produce cost-reducing effects in future.
Because of the extremely widespread tendency to advocate the use of cost
data as a basis for price fixing, as indicated earlier, by far the greater part
of the evidence submitted to me by individual producers and producer
organizations related to costs and the cost-price relationships. Because of
the current consumer interest in producer costs as related to producer prices,
it seems desirable to say something about the problems encountered in
connection with the calculation and use of cost information and also some-
thing about the possibilities of eflfecting further cost reduction.
Methods of Determining Costs
To begin with it is necessary to note that there are several fairly distinct
methods of general procedure that may be used when attempting to secure
the actual cost information. Since the start of the century four main methods
have been developed and employed in both Canada and the United States
as well as elsewhere. The Estimation Method uses data already gathered by
some one else as the basis for the desired cost figures. The sources of data
may include cost studies previously made and federal or provincial publica-
tions containing information on farm expenses and income. Ordinarilv this
method is used when only a rough estimate of costs is required. It has
sometimes been employed, however, because the figures were needed imme-
diately and when, therefore, there was insufficient time to conduct a careful
and accurate study. Its use has tended to decline as the desire for increasing
accuracy has made necessary the employment of more thorough-going
methods.
The Survey Method involves the personal visiting of farmers by an
enumerator who secures answers to a prepared list of questions. The farmer
is asked to give his estimate of each of the various cost items of the dairy
enterprise and usually, also, his estimates, or actual records if he has such,
concerning his entire farm business. The data secured relate to the year
preceding the making of the survey. Except in the case of the relatively
small percentage of farmers who keep regular and detailed farm business
records, the use of the Survey Method makes it necessary to rely on the
ONTARIO ROYAL COMMISSION ON MILK 39
farmer's memory concerning events covering a twelve-month period. This
necessity of depending on the memory rather than the actual record of what
transpired is unquestionably the big weakness of the survey method. While
it has commonly been assumed that errors of memory in one direction will
be offset by other errors in the opposite direction, it has often been found
that, in connection with certain kinds of questions at least, the majority of
errors tend to run in the same direction. In defense of the Survey Method,
however, it should be said that any margin of error in the answers given
is bound to become less pronounced as the percentage of farmers keeping
regular records of their business steadily increases. As that development
occurs the answers become transformed from estimates to records of actual
fact. Speaking generally the special advantages of the Survey Method are
that it gives results that are much more reliable than those obtained from
using the Estimation Method, that it permits information to be obtained
from a much greater number and variety of farms with a given expenditure
of funds than is possible when using more detailed accounting methods, and
that it makes possible the collection of data in a relatively short time.
A method sometimes known as" the Farmer's Record Plan differs from
the Survey Method in that it involves an arrangement whereby a repre-
sentative group of farmers agree to keep more or less complete records of
costs. When this plan is followed the number of farmers keeping records
is usually fairly large and the amount of assistance which farmers receive
from field supervisors is relatively limited. The main advantage of the
method is that data can be obtained from actual records, which avoids the
necessity of depending upon the estimates or memory of the farmer. The
main disadvantage is that records have to be kept for at least one full
production season before the data can be collected and analyzed.
The Detailed Accounting or Route Method is somewhat similar to the
Farmer's Record Plan, but is considerably more elaborate and detailed in
character. Detailed accounts are kept, usually by the farmer himself but
under close or direct supervision of a field man or route man who makes
regular visits to take inventories, check up on entries, etc. In order to be
able to allocate expenses to an individual product such as milk it is necessary
to find out how many hours of labor were spent on the dairy enterprise, how
nuich of each kind of feed w-as consumed by the dairy herd, how much
manure was obtained, etc. This involves the use of an elaborate set of labor,
feed and other records. The strong argument in favor of this method
is that it yields the most accurate and dependable data that can possibly be
obtained. One of its main weaknesses lies in the high expense involved.
Experience indicates that 25 farms are about as many as a route man can
handle. This matter of large expense per farm is likely to mean that the
number of farms from which data can be obtained is not sufficiently large
to provide a representative sample. Furthermore the high degree of farmer
co-operation which this method requires makes it almost certain that the
data will be secured from farmers that are much above the average in
efficiency.
In addition to the methods just mentioned, all of which are well estab-
lished, reference may be made to a plan followed in many areas in recent
years and which is based on the use of a formula. The formula is derixed
from information disclosed by an actual study of costs previously under-
taken in accordance with one of the methods already referred to and
indicates the physical quantities of the various kinds of feed and also the
amount of labor required to produce 100 pounds of milk. The basic
40 ONTARIO ROYAL COMMISSION ON MILK
assumption is that these quantities tend to remain fairly constant from year
to year. To the extent that thev do remain constant it is possible to calculate
the cost of producing milk at any particular time as well as to measure
the changes in costs as between periods by simply multiplying the various
quantities indicated in the formula by the current values of the re-
spective items. In using this plan all costs are reduced to terms of feed
and labor since all past studies have shown that these two items constitute
the major part of total costs.
It is further contended that feed and labor costs together account for
a definite percentage ( usually about 80 per cent ) of the total. In using
feed and labor as the basis for calculating the cost of producing milk, it
is assumed that as feed and labor prices rise or fall the other costs items
and also the credit items will fluctuate more or less in the same proportion.
While the costs of all items probablv never change in exact unison, ex-
perience has shown that thev keep near enough together to permit com-
parisons to be made.
The Formula Plan has the great merit of being simple, inexpensive
and capable of yielding immediate results. Its great weakness lies in
the fact that the kinds and quantities of feed and labour do not remain
constant for any great length of time. Furthermore it must be remembered
that the formula itself can onlv originate if an actual study of costs has
previously been undertaken. Details of formulas developed in various
centres may be found in Appendix 13.
The foregoing discussion mav perhaps serve to indicate the several
types of general procedure that may be employed in obtaining cost in-
formation and also the extent to which particular circumstances either
permit or dictate the use of one procedure rather than another. In addition
and in particular it may help to explain the choice of methods followed
during the present enquiry. From what has been said it will be obvious
that it was not possible for me to adopt any plan of procedure which would
have required a representative sample of producers to keep actual cost
records during a full producing vear. In view of this it was decided
that use of the Survey Method would probably yield the best or most reliable
results under the special circumstances. An independent commission
survey of costs of representative producers in different sections of the
province has therefore been made. The forms used in this survey are
shown in Appendix 14. In addition the evidence relating to costs sub-
mitted by a large number of individual producers as well as that presented
by the provincial and regional producers' organizations has been closely
studied. Some of this evidence was based on actual records kept by
farmers independently, a considerable part was the result of estimates, while
some was calculated with the aid of a formula such as that described above.
The conclusions reached regarding costs after careful study of all the data
secured will be stated later.
Irrespective of the procedure used to obtain cost information it seems
necessary to indicate the nature of several major difficulties which are
connected with the calculation of costs and their use as a basis for price
determination. These difficulties are primarily due to the very nature
of farming and the inherent characteristics of farm-cost data. One matter
which presents considerable difficulty is the question of what all should
be considered as cost items. In this connection the item concerning which
experts seem most inclined to differ is the one ordinarily known as wages
of management. Whether remuneration which a dair\ farmer receives
ONTARIO ROYAL COMMISSION ON MILK 41
for performing the function of management, as distinct from his labour
and capital, is to be included as a cost item must depend on whether
his reward for managing is considered as a profit, that is the difference
between his costs and his selling price, or whether it is regarded as
something which he must be paid in order to induce him to produce.
While there is a real problem of accounting principle and general economic
reasoning in deciding what items are legitimate parts of cost, there is even
greater difficulty when it comes to evaluating many of the items that are
included. Correct values are hard to establish for two reasons. One is that
cost elements are often used jointly by two or more enterprises, which means
that the joint expense has to be divided between the enterprises on an
arbitrary basis. Very few producers who are ordinarily called dairy farmers
produce and sell nothing but milk. While dairying may be their major
enterprise, their products usuallv include several kinds of crops and several
kinds of livestock, other than dairy cattle, or livestock products in addition
to milk. Labour, feed, building space, equipment use and other expense
items are actually spread over all of these products and the resulting joint
cost is incurred in respect of the total farm production. What part of the
joint cost has been incurred because of the production of milk as distinct
from everything else is obviously very difficult to determine with any
accuracy. While this part of the valuation problem may be relatively non-
existent when considering costs of whole milk producers who. as a class,
are more specialized than other dairy farmers, it becomes increasingly
serious as the farms considered are generalized rather than specialized in
character. In the case of creamery patrons, with many of whom the dairy
enterprise is distinctly secondary, it becomes really acute.
The second reason for the valuation problem lies in the fact that many
of the costs incurred do not actually involve an immediate cash outlay.
At what rate should such cost elements be valued? For example, what \alue
should be placed on the farmer's own labor or that of his wife and family,
on home-grown feeds, on manure, or on horse labor? Or again, what
value should be placed on the use of land and buildings owned bv I he
farmer and how is the depreciation on dairy cattle and mechanical equip-
ment to be estimated? Since, in all tvpes of farming, and dairy farming in
particular, a relatively large part of the total cost is composed of these
non-cash elements, it is obvious that reasonably accurate values, while most
desirable, are extremely difficult to obtain.
The difficulties thus far mentioned are connected with the securing of
cost information as distinct from the using of it. Still further difficulties
are encountered whenever an attempt is made to use cost data as a basis
for price determination. Before any price can be based uv^on or even
partially related to cost of production, costs must be expressed in the form
«)l a single summary figure. Such a figure is hard to obtain, however,
because the milk is produced by a very large number of independent
operators and because costs vary widely from farm to farm and region to
region in any one year and from one year to another. The fact that feed
costs ordinarily account for half of the total, and that weather and climatic
conditions by affecting crop yields largely determine home-grown feed
su|)plies and, indirectly, the extent of expenditure on purchased feeds is. in
itself, sufficient to explain why such cost variations exist. Since they do exist
it is necessary to make two kinds of decisions if cost is to be related to
price. First, in order to insure that the cost figure secured will be truly
representative, the sample of producers included in a cost studv must be
42 ONTARIO KOYAL COMMISSION ON MILK
large enough to insure that the effect of abnormal costs will be ironed
out or minimized and varied enough to reflect the differing degrees of
j)roducer efficiency. Similarly the period covered by the study must be long
enough to eliminate the effects of abnormal weather or other producing
conditions and continuous enough to permit cost-raising or lowering effects
of important changes in production methods to be fully registered.
The second kind of decision concerns the choice of an average cost. Since,
in any study, the costs will be found to vary considerably from farm to
farm and since only one cost figure can be used as a price-fixing guide, it
Ijecomes necessary to decide which one of the many individual cost figures or
what average of all of them should be chosen. In other words, it is a
fjuestion of deciding whose costs or what costs to use when trying to arrive at
a figure which is supposed to represent ""the" cost of producing milk. In this
connection I know of no one who has suggested that either the highest or
the lowest cost figures should be selected. A price based on the highest cost
figure would obviously bonus unwanted inefficiency, while one based on
the lowest cost would be entirely unfair and inadequate for the great
majority of producers, and would be certain to cause serious reduction in
milk supplies. On the other hand, a price equal to the simple average of
all costs would be unsatisfactory, since it might result in half the producers
operating at a loss. One commonly-suggested plan is to choose a figure high
enough to cover the costs of the great bulk of producers who produce all
but a small fraction of the milk. While this bulk-line method, as it is called,
is satisfactory in certain respects, it has no real scientific basis and is
somewhat arbitrary in character. Probably the most reasonable answer to
this problem would be to suggest that the figure selected should be one
calculated to give a fair return to all reasonably efficient producers. The
trouble with this answer, however, is that it assumes the existence of some
means whereby one can decide the exact figure beyond which reasonable
efficiency begins or ends. Since there is no scientific way of doing this the
cost figure chosen must admittedly remain somewhat arbitrary.
The foregoing discussion of some of the problems connected with the
calculation and use of cost data is not intended to suggest that it is either
impossible or undesirable to obtain and use cost information. At the same
lime it has seemed necessary to give some indication of what is actually
involved in carrying out such a program. From what has been said it
should be clear that the special nature of dairy farming and farm cost items
make it impossible to secure cost information that is more than approxi-
mately accurate. It should also be obvious that the securing of a summary
figure representing the costs of large numbers of producers, calls for
specialized knowledge, requires a very considerable amount of time and is
relatively expensive. Any program in respect of costs which ignores these
facts is unrealistic and likely to yield very disappointing results.
POSSIBILITIES OF FURTHER COST REDUCTION
The very fact that some producers' costs are considerably and consistently
lower than others suggests the possibility of reducing the general or average
level of costs.
It is clear that such a result would be secured if the costs of all or even a
fair percentage of the producers could be reduced to the level already
reached by the lowest cost group. In considering the chances of fulfilling
such a condition, however, it becomes necessary to discover the reasons for
the present variation in costs. In this connection the first thing to remember
ONTARIO ROYAL COMMISSION ON MILK 43
is that, in order to produce milk, a great many agents or factors of pro-
duction have to be combined. These agents include land, labour, feed,
buildings, mechanical equipment of various kinds, the cow herself and a
miscellaneous list of other things. Since all these agents cost money it follows
that a producer, in endeavouring to produce milk at the lowest possible
cost, must follow two main lines of action. He must try to obtain the
various agents as cheaply as possible. And he must try to combine them
both quantitatively and qualitatively in such a way as to obtain the largest
possible amount of product from his total expenditure. To make progress
along these lines the producer must be able to get and act upon many kinds
of information. Some of this information is physical or technical in charac-
ter while part of it is of an economic or financial nature. The fact that
producers differ greatly in their ability and inclination to become informed
plus the further fact that many of them, because of geographic location,
financial status or other reason, are unable to make practical application
of information gained serves to explain why costs of some producers are
consistently higher than those of others. In this connection the highlv
scientific character of modern dairy farming should be borne in mind.
It is no exaggeration to say that, in order to achieve real efficiency in the
production of milk, a present-day dairy farmer must be nothing less than
a generalized specialist. Those who exhibit this all-round ability in unusual
degree are ordinarily referred to as outstanding farm managers.
What has just been said leads to the conclusion that, in the last analysis,
the main requirement for the production of low cost milk is the possession
of high managerial capacity on the part of the farm operator. It is quite
true that milk cost studies have shown low cost to be associated with rela-
tively large area farms, large-sized herds, high production per cow, high
crop yields, efficiency in the use of labour and capital, and. particularly,
large volume of business or large volume of milk sales per farm per year.
Since, however, the items in this list are themselves generally associated
with, or the product of, superior management, it would seem that the basic
prerequisite for low costs is good farm management. This conclusion is in
line with evidence given by several producer witnesses during this enquiry.
I have been impressed by the extent to which good management was regarded
as the factor most responsible for efficiency in dairy farming.
This relationship between good management and low costs suggests the
desirability of fostering programs which might help develop a higher level
of managing ability. It may well be that the number who are inherently
capable of becoming really outstanding managers is relatively small. This
does not mean, however, that new knowledge and improved methods cannot
find fairly general application. Indeed it is only necessary to list the many
developments that have taken place already to realize that tremendous
increases in knowledge and improvements in methods are being effected
continuously. A good illustration of this is found in the quite pronounced
increase in milk production per cow during the war years, shown earlier
in the chapter.
Generally, the concrete forms which these improvements take are both
numerous and widely varied. They may aim at securing newer and better
feeds and feeding methods, higher crop yields, the development of higher
producing cows, more efficient use of labour, buildings and mechanical
equipment, reduction of cattle diseases or reduction in general overhead
through an increased volume of total business. In every case the general
purpose is to secure efficiency gains in respect of each of the many cost
44 ONTARIO ROYAL COMMISSION ON MILK
items and of costs as a whole. While many such changes and improvements
have taken place, and will continue to take place, there are two general facts
in respect of them which should be remembered. The first is that all such
improvements must of necessity be gradual in character. The second is that,
after a certain amount of improvement has been brought about, it becomes
increasingly difficult to effect still further improvement. In other words
the possibilities of cost reduction tend to be limited by operation of the
principle of diminishing returns.
Variations in cost of the type or class just discussed reflect in a general
way the variations in the knowledge and ability of farmers themselves.
It is precisely because they are, at least to some extent, amenable to human
control, that I have seen fit to discuss them here at some length. They are
the kind of variations which are perhaps susceptible to some reduction over
the long run. There are, however, at least three other general classes of
variations which should be mentioned. The first of these includes the many
variations in cost from farm to farm, county to county and year to year,
which are due to unusual weather conditions plus accidents of various sorts.
L'ontinuous wet weather during the 1947 seeding season, for example, is
Certain to result in an abnormally small crop of spring grains and abnormally
large requirements in the way of purchased grain. A further result is a
serious rise in costs due to the necessity of preparing seed beds several times.
\t the same time the effect is likely to be quite different in different sections
)f the province depending on the type of soil, topography of the land,
amount of drainage, etc. The point to note, however, is that the variations
in cost resulting from such weather conditions are not only bound to occur
but are entirely beyond human control. The same is true in cases where
cattle are killed by lightning or where buildings and feed supplies are
destroyed by fire.
Another class of cost variations are due primarily to major and continuing
differences in producing conditions in different regions or areas within the
province. The result is that these variations tend to continue over the years.
In most of Northern Ontario the short summer growing season, combined
with the long and severe winter feeding season, make for high labour costs
and heavy purchases of feed, the price of which ordinarily includes an
expensive transportation charge. In addition, the relative scarcity of pro-
ducers in some sections results in high cost of transporting milk. In a large
part of the milk-producing area of the Niagara Peninsula, crop yields have
tended, year in and year out, to be considerably below the provincial average.
The particular texture of the soil in much of this area is such that the period
during which satisfactory seeding can take place is particularly short. More-
over, the soil is expensive to work and especially incapable of withstanding
drought conditions. In this area also, the large number of secondary
industries tend to result in higher than average farm wage rates. Another
example of this type of variation is found in the case of those particular
farmers who supply whole milk to the Toronto market and who live in the
outer zones of the Toronto milkshed. Irrespective of the degree of efficiency
in transporting milk, these producers' costs must continue to reflect the
influence of greater distance from market.
Finally there are the cost variations which depend upon the kind of dairy
farming engaged in. Costs of producers who supply the fluid milk market
must normally be considerably higher than those of farmers who ship to
condensaries, cheese factories or creameries. The main reason for this is
that the fluid shipper's produce when consumed is still in the extremely
ONTARIO ROYAL COMMISSION ON MILK 45
perishable form of milk and that consumer demand for it is relatively constant
throughout the year. This means that the fluid shippers must aim to main-
tain a relatively even output at all times. No such requirement exists in the
case of the other three kinds of producers, since the milk which they supply
is not consumed until it is processed into some fairly non-perishable product
such as butter or cheese. The more even production on the part of the fluid
milk producers necessitates much more production during the winter months
which, of course, means higher feed and labour costs. Winter-produced milk
requires feed that has been expensively harvested and stored and special
labour to do the feeding and cleaning. \^Tiere milk is produced in summer
the main feed is harvested by the cows themselves and very little cleaning
of stables or hauling of manure is required. Again, where year-round pro-
duction is necessary, feeding has to be done with special care, special difficul-
ties are often encountered in getting cows to freshen at particular seasons
and the task of finding extra cows becomes both common and expensive.
Other reasons why costs of fluid shippers are higher than those of the other
groups are that the fluid people have to comply with much more rigid
sanitation requirements and that their product often has to be brought a
much greater distance to market or brought in a less transportable form.
In connection with this important matter of cost trends it is necessary to
remember that at the same time that certain influences may be operating to
reduce costs, other influences may be operating to raise them. Such a
situation is extremely common and may, indeed, be pretty much the rule.
Under these circumstances the general level of costs will tend to move up or
down depending upon which set of influences is the stronger. An iUustration
may make this point clearer. As the result of a general herd improvement
program which may involve a more careful selection of sires, artificial
insemination units, regular weighing and testing of milk, and a weeding out
of low producing cows, the average amount of milk produced per cow may
very well be raised somewhat. At the same time that this is happening,
however, the dairy farmer may be finding it necessary to pay more
for the hired man who feeds and milks the cow, for the materials needed
to construct or maintain the buildings or for the various types of
machinery and equipment required to grow the feed and generally operate
the dairy enterprise. In this connection the recent and pronouncd upward
trend in prices of the many things which farmers have to buv is of special
significance. It is also important to note that wages of hired farm labour
were never subject to ceiling levels during the war, and have continued to
rise during the period covered by the present enquiry. Evidence submitted
to me suggests that hired labour is going to be available in future only if
wage rates, housing facilities, working hours and general conditions of
employment are made distinctly more satisfactory than in the past. In view
of the fact that labour costs make up a sizable part of the total cost of
producing milk, it seems advisable to take special note of recent and pros-
pective developments on the labour front. Another significant trend of recent
years is the increasing prevalence of serious dairy cattle diseases. It must
also be realized that the continued drive to improve the average quality of
milk is bound to be accompanied by some additional cost.
What has just been said should be sufficient to indicate that trends in
milk production costs cannot be considered apart from such things as the
general price and wage levels, the general social standards in respect to farm
labor and the general eff'ort to obtain a higher standard product. It should
also make clear why production improvements of a purely technical sort do
not alwavs mean a net cost reduction in terms of dollars and cents.
46 ONTARIO ROYAL COMMISSION ON MILK
USE OF COST INFORMATION IN PRICE DETERMINATION
As already indicated, by far the greater part of the evidence submitted
by producers, both individually and through their organizations, had to do
with the cost of producing milk. The obvious purpose of this evidence was
to show what was considered necessary or reasonable in the way of producer
prices. It was clear that, in the minds of producers, price should be
sufficient to cover the cost of production. Nor was there any tendency on the
part of distributor or consumer interests to disagree with this view.
While it may seem not only fair and right but economically desirable as
well that the price received by producers should be high enough to cover
all their costs, the fact is that, in practice, such a price can be obtained only
when demand conditions are particularly favourable in relation to those of
supply. With a less favourable demand situation a price sufficient to cover
all costs can be obtained only if somewhat less than the total supply available
is actuallv offered for sale. Since October. 1946, for example, producers
liave been able to secure the price which became effective on October 1st last,
but the amount of milk which they could sell at this price has been reduced
considerably as consumer demand has become less effective.
Since all prices, including the so-called fixed ones, are only scientific and
enforceable to the extent that they reflect conditions of demand as well as
those of supply, it follows that in the setting of fluid milk prices something
more than cost of production must be considered. To base these ])rices on
costs alone would, it seems to me, be equivalent to approaching the price
problem from the supply side only. In addition, even if supply and demand
conditions were such as to warrant a price in line with costs, there still
lemains the question as to whether one calculated on some other basis might
not be even more satisfactory. One other basis that has been widely
advocated in recent years in both Canada and the Tnited States is the parity
price plan. This involves selection of a basic period during which the rela-
tionship between the farmers' selling and buving prices is regarded as satis-
factory. Having once established what this relationship should be. the aim
would he to maintain it by seeing that all farm prices in future are set at
the parity level, that is the level which wousld give farmers the same pur-
chasing power as they had in the base period.
While it may not always be either possible or desirable to fix milk prices
at levels corresponding with costs of production, it by no means follows that
cost data cannot be used to advantage when determining prices. In my
opinion they should and can be used as a general guide rather than as the
all-important determinant. It seems prettv obvious that any price arrived
at should reflect the general supply and demand conditions and should
therefore be decided upon only after the various indexes of those conditions
have been carefully examined. In the last analysis, however, it must not be
forgotten that the price received by the producer for milk is also the price
paid b) the distributor. In fact it is very likely to be a price agreed to by
the representatives of the producers and distributors after a period of bar-
gaining. Wherever such bargaining takes place it is generallv agreed that a
distinct advantage lies with the bargainer who has the more complete know-
ledge of his costs. There can be little doubt that in the milk price bargaining
that has gone on producer representatives have been seriouslv handicapped
because of incomplete knowledge of their costs.
Where producer price cannot be arrived at by mutual agreement between
the two groups directly concerned and where, consequently, a price has to
be arranged by arbitration, an arbitrating authoritv such as' the Milk Control
ONTARIO ROYAL COMMISSION ON MILK 47
Board would, I think, be greatly helped by the possessions of reliable
information on both the costs of production and distribution. Any arbi-
trating authority, since it is arranging a price between two parties, must
surely be concerned with seeing that the price arrived at is equally fair to
both of them. One way of deciding whether any price change is equally
fair to both producers and distributors is to see whether the cost-price
relationships of the two groups are likely to be affected in equal degree.
In cases where a price reduction is necessitated by a drop in demand effec-
tiveness, the impact of the price reduction should, in my opinion, be spread
equally between the two groups. In other words prices should be arranged
so that both groups will share in the benefits or burdens of the general market
situation. From the evidence I have received it would appear that the general
practice in past price fixing has been to have any changes in prices charged
consumers reflected in corresponding changes in prices received by producers.
This has meant that distributor price margins have remained substantially
unchanged. This is not true in the case of the last price increases. Whether
this policy has resulted in the gains and losses being anywhere near equally
shared by producers and distributors is difficult, if not impossible, to say.
What does seem probable, however, is that this policy has caused the
extremes between good and bad times to be much greater in the case of
producers than in that of distributors. Whereas variation in distributor
income has been due mainly to changes in volume of business handled rather
than to changes in the unit margin charged, the income of the producer has
been subject to pronounced variations, not only in the volume of milk sold
for liquid consumption but also in the price per hundred pounds at which
it was sold.
GENERAL CONDITIONS UNDER WHICH FLUID MILK IS SOLD
Before discussing the general conclusions of the Commission regarding the
cost of producing milk and the relationship between the cost and the selling
price, it may be desirable to explain briefly one or two important general
conditions under which fluid milk is sold.
Sale on the Bulier-jat Basis
It should be noted that, when producers sell whole milk to the distributors,
the price received varies depending upon the butter-fat content of the milk.
The regular or officially-stated price, when milk is used for fluid consumption,
is paid^for 100 pounds of milk testing 3.4 per cent butter-fat and for each
tenth of one per cent below or above this figure the price is reduced or
increased SVL' cents per hundred pounds. For example, if the milk tests 3.2
per cent the price paid is seven cents less than the official price, whereas, if
it tests 3.6 per cent, the price paid is seven cents more than the official figure.
Where milk prices are mentioned in the ensuing pages they refer to 100
pounds of milk containing 3.4 per cent butter-fat. Milk with this percentage
of fat is known as standard milk.
While milk was originallv sold on a weight or volume basis only, this
became increasingly unsatisfactory for several reasons. To begin with, it
constituted a direct invitation to milk watering on the part of a certain type
of producer. In the second place it resulted in all milk being sold at the
same price per 100 pounds despite the fact that some of it, because it con-
tained more fat, had much greater food value measured in calories, and was
therefore more valuable commercially than the rest. At the same time that
producers shipping milk with high fat content were being discriminated
48 ONTARIO ROYAL COMMISSION ON MILK
against, the distributors who were able to buy this particular milk secured
a distinct advantage over their less fortunate competitors.
The practice of paying the same price for milk regardless of its food value
or fat content, became increasingly unsatisfactory as more and more pro-
ducers selected particular breeds when developing their dairy herds. It
became obvious that milk from Jersey or Guernsey cows which tested up to
five per cent fat or even more was quite different from milk from Holstein
herds testing in the neighbourhood of three per cent. It was also clear to
producers that the cost of producing 100 pounds of the high testing milk
was much greater than that involved in producing an equal amount of the
lower testing article.
In order that the price paid for milk might correspond more closely with
its true value, it was decided many years ago that milk should be sold on
the basis of its butter-fat content. Despite the fact that other constituents
as well as the fat go to determine the full food value of the product, it was
felt that sale on a butter-fat basis would result in a reasonable approximation
to fairness to all concerned. There was the additional fact that a relatively
simple method of determining the fat content had been developed.
While sale on the butter-fat basis cannot be considered entirely satisfactory,
particularly in view of the evidence of the nutritional experts mentioned
at the beginning of this report, it appears to have the general acceptance of
those in the industry, and no reasonably satisfactory substitute for it was
suggested to me during the course of the enquiry. In saying this I am not
overlooking the fact that it was suggested that bacterial tests by the use of
Methylene blue dye and a sediment test might be combined with the butter-fat
method of grading. Under present conditions no practical way of doing this
seemed apparent. Whether it is fallacious or not, there has been a very
general belief on the part of the consuming public that rich milk is the
equivalent of better milk, and this belief has actually been fostered by the
advertising policies of the distributors. Despite this situation one cannot
help feeling that the time has arrived when a more scientific basis of valuing
milk should and could be found. In this connection the following quotation
from a recent bulletin prepared by Dr. E. G. Misner of Cornell University,
a noted authority on dairy marketing, is extremely significant. The bulletin
is entitled "Commercial Value of Milk of Different Fat Tests" and was issued
in July. 1946. The quotation is as follows:
"The method used in paying for fluid milk when all of the constituents
of milk are used in commercial wavs is of considerable financial importance
to producers of milk containing different percentages of milk fat. When
the producer separated the milk, sold the cream and kept the remainder
at home on the farm, it was logical to pay him for the cream on the basis
of the fat which it contained. Under such conditions, he could use the
separated milk at home for feeding hogs, calves, chickens, turkeys, or for
household uses, thereby converting it into income. The income that he
derived from skim milk so utilized depended upon the effectiveness of the
use. For example, if he had valuable purebred cattle or hogs, the feeding
of separated milk to them could result in an extraordinarily high realization
from its use in that manner.
"But to-day, where fluid milk is delivered to a plant or handler, the
method of paying for that milk on the basis of the fat which it contains
is outmoded and. wherever it is now used for any class of milk, should
be replaced by a more scientifically economic method of varying the price
to the producer. The reason whv this should be done is simple. About
one-half of the food value of milk (milk energy value in calories) which
ONTARIO ROYAL COMMISSION ON MILK
49
tests 3.5 per cent is contained in the solids-not-fat, while the other half is
contained in the fat itself. The solids-not-fat do not increase in the milk
proportionately to the increase in fat. While the fat increases 0.1 pound,
the solids-not-fat increase only 0.04 pound, or 40 per cent as much. Because
the one-half of the value of the milk contained in the solids-not-fat increases
only 40 per cent as much as the fat, payment to producers on the basis
of fat deprives the producer of low testing milk of some of the commercial
value of the product and returns to producers of higher testing milk more
than the commercial value of the product. For this reason it is ridiculous
to vary the price to producers for their milk in a manner which is directly
proportional to the fat test of the milk. It would be more scientifically
correct to vary it according to the total food value (milk energy in cal-
ories) of the rnilk."
Until such time as some plan is devised and adopted which will make it
possible for the total food value of milk to be more nearly reflected in the
price paid, the present method of selling on a butter-fat basis will probably
continue. In view of this prospect the actual extent of the price variations
which correspond with the variations in fat content should be carefully
reviewed. At the present time fat in the milk is valued at 35 cents per pound,
and this rate has prevailed for several years. Even if it is assumed that all
fat should be valued on the basis of its value for butter-making as distinct
from its value when disposed of in the form of sweet cream or ice cream,
the adequacy of the prevailing rate of 35 cents per pound would seem to be
open to question. The price of butter at the present time would suggest that
the rate should be considerably higher. If milk is to be sold on a butter-fat
basis the price variations resulting from variations in the fat content should
at least be reasonablv in line with the true commercial value of the fat.
Despite the fact that it may not be feasible to make frequent changes in the
price at which the fat in the milk is valued, there seems no justification for
regarding the rate as something that should remain fixed indefinitely.
Under the Dairy Products Act (Ontario) 1938, Chapter 7, certain regu-
lations were approved. Regulation 14 was as follows:
(1) Milk received at a milk and cream distributing plant shall be
purchased on the differential basis of 3.4 per centum butter-fat as set
forth in subsection 3. provided that milk that tests over 4.5 per centum
butter fat shall be purchased at the same price as milk testing 4.5 per
centum butter fat or at a higher price.
(2) A differential for the price of milk received at a milk and cream
distributing plant shall be allowed for each one-tenth per centum butter
fat above or below a test of 3.4 per centum butter fat and such differential
shall be based on the wholesale price of creamery butter in Montreal and
Toronto during the first ten days of each calendar month as reported
by the Director.
(3) (a) The increased differentials for the price of milk received at
a milk and cream distributing plant testing 3.4 to 4.5 per centum butter
fat inclusivelv. shall be on the following basis:
Increased Differential in Price for
Each One-Tenth Per Centum
Average Price of Butter Butter Fat
Under 25 cents per pound 3 cents per 100 pounds of milk
25 cents and under 30 cents 3V> " " 100 " " "
30 cents and under 35 cents 4 " " 100 " " "
35 cents and under 40 cents 41^ " " 100 " " "
40 cents and over 5 " " 100 " " "
50 ONTARIO ROYAL COMMISSION ON MILK
(b) The decreased differential for the price of milk received at a milk
and cream distributing plant testing below 3.4 per centum butter fat
shall be on the reduced basis set forth in clause (a).
(5) No change in the differential price of milk shall be made for a
period of less than one month.
(6) For the purposes of this Section "milk and cream distributing
plant" shall mean any plant where milk or milk and cream is brought
for the purpose of re-sale for human consumption in its natural state or
pasteurized.
This regulation was rescinded by Order-in-Council on December 7, 1940.
The current regulation which came into effect on the same day is No. 27
of the regulations under the Milk Control Act as prepared and drafted by
the Milk Control Board of Ontario and this regulation is as follows:
"27. Milk supplied to a distributor by a producer and required to be
purchased at the basic price shall be paid for on the following differential
basic price:
(a) milk testing 3.4 percentuni butter-fat shall be paid for at the
basic price;
(b) milk testing more than 3.4 percentuni butter-fat shall be paid for
at the basic price plus three and one-half cents per one hundred pounds
of milk for each one-tenth percentum butter-fat that such milk tests over
3.4 percentum butterfat;
(c) milk testing less than 3.4 percentum butter-fat shall be paid for at
the basic price less three and one-half cents per one hundred pounds of
milk for each one-tenth percentum butter-fat that such milk tests below
3.4 percentum butter-fat ;
(d) where a basic price has been established for a class of milk at an
amount which is higher than the basic price for standard milk such higher
basic price shall be used in connection with the payment for such class
of milk."
In my view the current regulation unreasonabh benefits the owjiers of
Jersey and Guernsey herds producing very high test milk and at the same
time works to the great disadvantage of the farmer whose production comes
from Holstein herds. The bulk of the production of milk in this Province
comes from either pure bred or grade Holstein herds.
I am at a loss to understand the acquiescence of the Ontario Whole Milk
Producers' Association in the regulation made under the Milk Control Act,
and I am equally at a loss to understand the failure of that Association or
in fact of any producer to draw my attention, during the hearings of this
Commission, to the situation set out above.
'I he Quota System
While some producers are fortunate enough to have all their available
pioduction taken by their distributors, this situation does not prevail in
respect of the industry generally except in periods of unusual scarcity and
\ery large consumer demand. Ordinarily the average producer is on what
is called a quota. The quota system is simply a method by which the
K-tal requirement for fluid milk is rationed out among the producers so
that all may get a fair share of the limited market Avhich is available. In
many markets the arrangement of quotas is undertaken by committees
representing the distributors and producers.
When producers are on quota, only the milk taken from them by the
ONTARIO ROYAL COMMISSION ON MILK
51
distributor for distribution as (luid milk is paid for at the agreed price.
Any additional milk purchased by the distributor is treated as surplus milk
and paid for at the surplus price. While the spread between fluid milk prices
and the surplus milk price varies slightly from market to market, it may
be said with reasonable accuracy that at the present time surplus milk is
Aold at SI. 00 per 100 pounds less than the fluid milk price.
The bases on which quotas are set will be discussed later in greater
detail, together with the surplus milk disposal problem. The effectiveness
with which the surplus milk can be disposed of is an important factor in
determining the amount which the producer actually receives for his total
product. In the meantime it may be well to keep in mind the general
explanations given above when attempting to assess producer costs and
income from the fluid milk market.
One other general consideration that may be mentioned in passing is the
fact that all producers serve certain definite )narkets. The areas supplying
each of these markets are popularly spoken of as milk sheds. In the orga-
nization of these milk sheds there is a great deal of overlapping and they
have not been planned with what might be called scientific accuracy, but
have rather grown with the passage of time. A general discussion of them
in a more detailed way will be found in the chapter dealing with transporting
of milk from the producer to the distributor as, logically, the problems
they involve seem to be more closely linked w ith those of transportation.
FINDINGS IN RESPECT OF MILK PRODUCTION COSTS
The steps taken to obtain reliable information regarding the actual cost
of producing milk have been outlined above. Very careful study was given
not only to the considerable volume of evidence relating to costs submitted
by individual producers and producer organizations, but in addition an
independent survev was undertaken on behalf of the Commission to supple-
ment and to \erify this e\ idence. This was undertaken in weather conditions
last winter which added to the difficulties, but by and large a check was
made in all parts of the province.
In the result, putting the evidence and this survey together, I believe that
a reasonable indication of milk production costs has been obtained during
the 194C calendar year. This is, of course, a general average for the
province, and is subject to variations owing to unusual climatic conditions,
variations in soil conditions, and transportation costs which affect certain
specific parts of the province somewhat differently. For example, the cost of
producing milk in the mining areas of Northern Ontario is. for reasons which
are too obvious to mention, a heavier one than the production of the same
product in. say. the long established dairy county such an Oxford.
It is also true that, for reasons which have been discussed above, the
1946 costs may differ from those of any other single year, but this is true
at any given time, and merely underlines the necessity of a continuous cost
study if the producer's position is to be known by them at any one time.
As I have said, a very great number of individual attempts to work out
cost were presented to the Commission in various parts of the countrv. and
there was a wide variation in these, as one would naturally expect.
In the brief of the Ontario Whole Milk Producers' League, a study was
made of costs as they related to the Toronto milk shed, and it was stated
they were of general application in Hamilton and the Niagara Peninsula
markets.
The general survey undertaken by the Commission showed that for the
52 ONTARIO ROYAL COMMISSION OX MILK
most part there was not a very great variation of cost, save in Northern
Ontario and those parts of the Niagara Peninsula comprising what is known
as the Haldimand Clay Belt. In these two areas costs were found to be
somewhat higher. A comparison of the results obtained by the Commission
with those disclosed in the Hare Report, which dealt with costs during 1936
to 1939, would seem to show that these differences are relatively permanent.
The tables furnished the Commission by the Whole Milk Producers'
League are set out below in full from their brief.
Prices of Items Entering Into Cost of Production
Concentrates: Denom. 1943 1946
Oats cwt. )(1) $1.62 $1.78
Barley cwt. | 1.39 1.58
Dairy Cone cwt. (2) 2.85 2.85
Roughage :
Mixed hay ton 9.89 10.22
Silage ton 4.00 4.50
Labour hour (3) .32 .46
Haulage cwt. .28 .28
Note (1) : These prices do not include any charge for chopping. It is
the view that this is 5c to 10c per cwt. and this might be
legitimately included, thus raising the price per cwt.
Note (2) : This is the wholesale price F.O.B. Toronto. It includes no
freight or trucking charges to the farm. These might legiti-
mately be included, thus raising the price per cwt.
Note (3) : This is merely the cost of the actual number of hours of labour
required to produce 100 lbs. of milk. These costs repay the
farmer only on the basis of the manual worker and there is no
allowance made for any managerial or supervision costs. Such
cost might be legitimately added.
Having established, by the foregoing table, the cost of the items entering
into the cost of production the following table gives the net average cost of
producing 100 lbs. of whole milk on a delivered basis, i.e. delivered to
the distributor.
Average Net Cost of Producing 100 lbs. Whole Milk {delivered basis)
1943 1946 Increase
Concentrates (1) $ .65 $ .70 $ .05
Hay (2) 39 .41 .02
Silage (3) 32 .37 .05
Pasture (4) 27 .31 .04
Labour (5) 96 1.38 .42
Depreciation (6) 34 .44 .10
Hauling (7) 28 .28
Breeding (8) 04 .06 .02
Misc. (9) 22 .24 .02
3.47 4.19 .72
Less credits (10) 45 .54 .09
NET COST $3.02 $3.65 $ .63
ONTARIO ROYAL COMMISSION ON MILK 53
Note (1) : This is the cost of 36 lbs. (made up of 21 lbs. of oats, 8 lbs. of
barley and 7 lbs. of dairy concentrates) .
Note .(2) : This is the cost of 80 lbs. of mixed hay.
Note (3) : This is the cost of 160 lbs. of silage.
Note (4) : This is 1/30 of an acre per 100 lbs. of milk on 12 months
average.
All of the foregoing amounts are premised on an annual
production of 8,000 lbs. of milk per cow which is well above
the average. The average would be about 7,500 to 7,600
lbs. only.
Note (5) : This is on the basis of 3 hours. As indicated before this is
actual manual labour only.
Note (6) : There are three items in depreciation, viz:
(a) Buildings at 5%;
(b) Machinery and equipment at 12^^%;
(c) Herd at 20%.
Buildings were valued at S2,400 on basis of requirements
for a herd of 20 cows. The same figure was used for both
1943 and 1946.
Machinery and equipment was valued at S800 in 1943 and
SHOO in 1946. This again was on the basis of requirements
for a herd of 20 cows. The difference between 1943 and 1946
values is accounted for by some increase in prices of machinery
and equipment and to more extensive investment in labour
saving devices.
Herd was that of 20 cows at $120 per cow, viz. S2,400.
This price per cow is low.
Note (7) : This is the figure established by the Milk Control Board and
remains constant. -
Note (8) : This is based on the actual cost of servicing the cow and pre-
supposes only one fee of $5.00 — the cost in 1946. In 1943
it was S3. 50 only.
Note (9) : This miscellaneous item includes bedding, minerals, taxes,
insurance, association fees, insecticides, veterinary services,
telephone, etc., or so much thereof as is attributable to the
dairy. This is admittedly fairly difficult to average between
farmers and must of necessity be an estimate only.
Note (10) : As the foregoing figures in the table are based on gross pro-
duction by the farmer certain credits must be allowed as
follows :
(a) milk utilized on farm — estimated at 10% of gross
production;
(b) one calf per year per cow — valued at $5.00;
(c) manure produced by cow — estimated at 5 tons per cow
per year of the value of $1.25 per ton:
(d) appreciation in value of cow because of present upward
trend of prices. It is extremely doubtful if this should
properly be included. Its exclusion would reduce the
credit.
In the foregoing items of cost of production of 100 lbs. of milk it should
be observed that no account has been taken of
(1) any interest to the producer on his capital investment in buildings,
machinery and equipment, and herd; or
54 ONTARIO ROYAL COMMISSION ON MILK
(2) any interest to the producer on any working capital made necessary
because of the time lag between delivery of and payment for the milk
and due to the fact that feed, etc., must be produced or purchased and
paid for in quantity in advance of use.
The result of the Commission's studies are shown in the following summary
table. It will be noted that there is some variation between the two. Insofar
as the Commissions estimate of costs is concerned, the various elements that
enter into that figure have been set out. It emphasizes also the importance
of each element, the average net cost for the entire province, and the average
total cost, including what is called the administration allowance to cover
interest on investment and to give the farmer some profit from his enterprise.
In this case, as in the tables submitted by the Whole Milk Producers' League,
the figures relate to the cost of producing 100 pounds of milk for the
Avhole milk market.
TABLE SHOWING AVERAGE COST OF PRODUCING WHOLE MILK
IN ONTARIO, 1946
Cost per 100
lbs. Milk
Concentrates 94
Hay ; 50
Silage .31
Pasture 28
Total feed cost S2.03
Dairy herd labour $1.17
Depreciation of dairy buildings and equipment .14
Hauling .22
Miscellaneous .48
Gross cost S4.04
Credits:
Milk used on farm .16
Manure 25
Cattle sales less cattle purchase? and inventory adjustments .44
Total credits .85
Average net cost S8.19
Administration allowance .48
Total cost S3.67
In regard to the abo\e table there are two or three points \\hich seem
worthy of special note. One of these is the extremely large part which the
feed and labour items contribute to the total cost picture. It will be observed
that feed and labour costs combined coincide almost exactly with the average
net cost figure. Another fact which is really a counterpart to the one just
mentioned is that the sum of the costs other than feed and labour, i.e..
depreciation, hauling and miscellaneous, is completely offset by the total
credits. A third point Avhich seems to me to be particularly significant is
the large credit resulting from dairy cattle sales. This credit above amounted
to 44 cents j^er TOO pounds of milk, largelv because the number of dairy
ONTARIO ROYAL COMMISSION ON MILK 55
cattle sold during 1946 was much larger than usual and because the selling
price was relatively high. The mere fact that these sales can and do vary
markedly from >ear to year indicates the necessity of a continuous cost study
if serious attention is to be paid to cost data at any particular time. Had
there been no cattle sales in 1946 the average cost of producing milk would
have been 44 cents a 100 pounds higher than it actually was.
Finall) something should be said in explanation of the item called "Admin-
istration Allowance"". In the reports of many milk cost studies which I have
examined interest on investment in livestock, dairy buildings and equipment
has been included as part of the net cost. This was the method followed in
the Hare stud>. the study undertaken by the Ontario Milk Production Com-
mittee in 1920 and 1921. the ten-) ear study of milk costs in the Montreal
region carried out i)\ the Quebec Department of Agriculture from 1928 lo
1938. and indeed in most studies that have been made in various parts of
Canada and the United States. In these studies the cost on account of
interest ran from about 12 to 15 or more cents per 100 pounds, depending
upon whether the study was made in a high or low value period, the rate of
interest prevailing, etc. In the calculations made by this Commission, how-
ever, it has been thought jireferable to calculate net cost exclusive of interest
and to add the interest cost later. This has been done partly because it is
in line with currenl business practice and partly, also, because most of the
briefs submitted 1)\ indixidual pioducers and producer organizations did not
include an interest item. While opinions mav differ as to the method of
inclusion, there seems no doubt but that interest forms a very definite part
of the cost of ])roducing milk.
In addition to interest, however, it seems to me that the dairy farmer,
like any other business man operating under our free enterprise sxsteni. is
entitled to a reasonable profit on his whole undertaking. Whether the amount
permitted is considered as a special wage of management, a reward for risk,
or a straight profit margin, i.e.. the difference between costs proper and the
selling price, the principle involved is the same. It is at least a social cost,
something Avhich society must expect to pay for getting the job done.
Whether it should be regarded as part of production cost in the strict sense
may be open to debate. In mv opinion, however, it should very definitely
be included in the amount of monev which |)roducers receive for their milk.
To suggest otheru ise would be to discriminate against the farmer as com-
pared with other business men or to claim that nobodv is moralh entitled
to receive any profit. As to the actual amount of the allowance as distinct
from its justification. I feel that the figure here suggested is an extrenieb
leasonable one. A comparison with normal rates of profit in other lines of
business will. I believe, readilv confirm this view.
When the cost figures shown in the above table are compared a\ ith the
prices received bv producers for their milk, certain conclusions become fairl\
obvious. One is that. ])rior to October 1st last, the average producer s returns,
including the producer subsid) of .55 cents per 100 pounds, were considerabl\
less than sufficient to cover his net cost, to say nothing about providing him
with interest on his investment and something by way of a profit. This was
jiarticularh true in respect of producers in North Western Ontario and in the
\iagara Peninsula area where costs were verv considerably above the pro\ -
iiicial average. In the second i)lace it would appear that, even with the
increased prices which became effective after October 1st. 1946. the ]irice
received by producers in the two areas just mentioned was still insufllcient
to cover the net cost of production. 0)i the other hand, so far as producers
HI the balance of the province weie concerned, the higher jirices received
56 ONTARIO ROYAL COMMISSION ON MILK
after October 1st was apparently not only sufficient to cover net cost but was
sufficient to meet a very considerable part of the administration allowance
suggested here as well. This last statement, however, is based on a very
important assumption and one that has become less and less valid with the
passing of the period since last October. That assumption is that whole milk
producers have been able to sell all their milk at the top price. According
to the evidence presented to me, the demand for milk for fluid consumption
during most of 1946 and for a considerable period previous to that, was such
that all available supplies were readily absorbed. Under these circumstances
all whole milk shipments were sold at the regular or official whole milk price.
Since the latter part of 1946, however, a growing surplus above fluid require-
ments has appeared, and this surplus or secondary milk has had to be sold
at the secondary or butter-fat price which, as previously stated, is very much
below the regular whole milk price. What percentage of the milk produced
by whole milk shippers is now being used for surplus purposes and paid for
at surplus prices, I am unable to say, but I am informed that it is considerable
and steadily increasing. That this is so can be readily substantiated by
examining the official figures of retail milk sales.
This fact that a large and increasing part of the milk is being sold at
much less than the regular whole milk price means that the average price
received for all the milk shipped is being steadily reduced, the rate of
reduction depending upon the percentage that has to be sold at the secondary
price. This fact of a drop in the average price received has an obvious effect
on the cost-price relationship. While the average price received falls as
the amount sold at the surplus price increases, cost of production remains
as before. It costs just as much to produce and transport the milk sold as
surplus as it does to produce that sold at the regular market or quota price.
In fact, it seems altogether probable that costs have risen rather than fallen
in recent months. The most recent official figures of farm wage rates would
suggest this to be the case. In light of these circumstances it would appear
that the average price received at the present time is, at best, no more than
sufficient to cover the net cost indicated above. That is, it is not sufficient
to provide any interest on investment, to sav nothing of anv clear profit. In
the light of this situation it is significant that the chief officials of the ^Tiole
Milk Producers' League, in their final appearance before the Commission,
stated very definitely that the producers' organization was interested in main-
taining the existing prices rather than in securing any further price increases.
This stand was taken despite the fact that the existing prices were consider-
ably below the cost figures previously submitted by the League. It was quite
apparent that the League officials recognized that the amount of surplus milk
was steadily increasing and that, consequently, the average price being
received for all milk sold Avas steadily falling. Their recommendations in
respect of the prices desired reflected a recognition that, under the prevailing
conditions of demand as well as supplv. producers were likelv to be worse
rather than better off with higher official selling prices.
The cost figures thus far presented relate to the province as a whole.
Consideration of costs on a regional basis indicates that, during the period
surveved, costs were considerably higher in North Western Ontario and in
the Hamilton and Niagara Peninsula area than elsewhere in the province.
More specificallv our calculations indicate that in the Kenora. Dryden and
North Western Ontario districts the net cost is S3.97 per 100 pounds which,
with an administration allowance of 48 cents would give a total cost of
.'?4.4.5. Similarly, in the Hamihon and Niagara Peninsula district the indi-
cated net cost is S3.47 and the total cost .'!n3.9.5. An explanation as to why
ONTARIO ROYAL COMMISSION ON MILK 57
costs tend to be higher in these two sections of the province than elsewhere
has, I believe, been offered in an earlier section of this report. Aside from
the two areas mentioned, no really pronounced cost variations of a regional
character were found. Because of this the cost data relating to all of the
province except the two areas specified above has been grouped together.
When so grouped, the representative figures resulting show a net cost of
$3.09 or a total cost of $3.57 a hundred pounds. While costs were apparentlv
reasonably uniform throughout this large area in 1946, it does not follow
that a similar situation will continue indefinitely. It may well happen in the
future as, indeed, it has happened in the past, that costs in a particular year
will be higher in the Toronto, the Ottawa or the Windsor district than in the
rest of this large area. The main point to stress, however, is that, whereas
regional cost variations within this area are year to year phenomena, the
higher levels of cost which characterize the North Western and Niagara
Peninsula areas are likely to continue year after year.
In comparing the cost figures submitted by the Whole Milk Producers'
League with the findings arrived at by the Commission after a correlation
of the evidence and its own survey, there are certain substantial differences.
It cannot be said, however, that the general result shows any significant
difference. Part of the differences which do exist may be accounted for
from the fact that the League's statement was based generallv on the Toronto
market conditions while the Commission's study represents the provincial
average. This fact alone would account for a higher hauling charge in the
case of the producers" computation and also for the somewhat heavier feed
cost.
As for the difference in the amount allowed for depreciation, this is partly
explained by the fact that the Commission's figure was based on somewhat
lower depreciation rates for both buildings and equipment, and partlv by the
difference in the method used to calculate the depreciation on dairy cows.
The larger credits allowed for in the case of the Commission's findings are
primarily due to the very extensive sales of dairy cattle at relatively high
prices during the year 1946. This particular factor was not given sufficient
weight in the League's computation.
The remaining major difference may be attributed to the fact that in the
Commission's findings an administration allowance of 48 cents per 100
pounds to cover interest and provide some very moderate reward for man-
agement has been included. No such provision has been made in the case
of the League's presentation.
THE TESTING OF WHOLE MILK
Mention has already been made of the fact that fluid milk is sold on a
butter-fat test basis, and some consideration has been given to the extent to
which that basis may be regarded as satisfactory. For the purposes of the
previous discussion it was assumed that there was no particular problem
connected with the actual taking of the tests and that the tests, when made,
could be absolutely relied upon. At this stage of the report, however, it
seems necessary to discuss some important problems which have arisen in
connection with the performance of the testing operation and. in particular,
to consider the possibilities of eliminating dissatisfaction with the testing
results.
In considering this matter the first point to note is that not only is all
milk sold subject to test, but that the testing is done in the distributors' plants
and by distributor employees. This situation leads inevitably to a two-fold
result. In the first place it is obvious that the producer's returns will varv
58 ONTARIO ROYAL COMMISSION ON MILK
with the accuracy of the test. On the other hand, since the butter-fat test
has economic significance and since the testing is left in the hands of the
distributor, it is only natural that producers should be inclined to wonder
whether the tests received are as high as those to which they are actually
entitled.
The need for preventing or eliminating producer dissatisfaction with the
tests as given by distributors has led to adoption of the system known as
check-testing. As the name implies, arrangements have been made whereby
qualified testers employed by either the producers' organization or the Milk
Control Board make occasional visits to the distributor plants for the purpose
of making tests with which those made by the distributors can be compared.
This testing represents an important part of the work entrusted to the full-
time fieldmen employed by the Milk Control Board. These fieldmen are
divided into two groups. The complete task of the eight men in one group
consists in making occasional checks to see that legal regulations are observed
with respect to weighing, sampling, butter-fat testing and paying for milk
supplied by producers. The two men in the other group undertake special
investigations regarding major irregularities reported by the first group, as
well as complaints made by producer and distributor organizations and
special audits on behalf of the Board itself.
So far as the checking of butter-fat tests is concerned, there can be little
doubt that the work undertaken to date has had a very beneficial effect.
Apart from the actual correction of mistakes and the satisfaction of com-
plaints, the very fact that a check test may be made at any time, and is
actually made at least occasionally, has undoubtedly helped to deter certain
distributors and reassure many producers. At the same time I think it
must be admitted that even an expanded check testing service can nevci
do more than act as a check. It would seem that, at the very best, it can
reduce the number of inaccurate tests but cannot hope to eliminate them
entirely.
During this enquiry the amount and character of producer evidence rela-
tive to the milk testing problem was such as to indicate that a very con-
siderable measure of producer dissatisfaction still exists. In connection with
this matter I am inclined to think that the number of actual complaints
made is far from an adequate measure of the amount of dissatisfaction which
prevails. My impression is that more complaints would be made were all
producers fully conversant with the facilities available and procedure required
for considering them. 1 was also impressed by repeated statements to the
effect that producers have refrained from complaining about the tests
because they feared the results of incurring distributor ill-will. It is clear
to them that, in all but periods of unusual scarcity, a relatively large scale
distributor can readily dispense with the milk of any individual producer.
Moreover it is quite possible to do so since the distributor deals with each
producer individually rather than with the producer organization when
agreeing to take the milk. In other words, the extremely weak bargaining
position in which the individual producer is placed makes him hesitate to
risk weakening it still further by complaining about the butter-fat test.
In considering the possibilities of bringing about improvements in the
testing situation, there are one or two things which it seems necessary to
bear in mind. In the first place it is fairly obvious that it is physically or
technically impossible to have the laboratory analysis made at the producer's
farm, although there appears to be no reason why sampling should not be
done at the farm. In the second place, it is equally clear that, since such
analysis is normally made at the headquarters of the distributor and by
ONTARIO ROYAL COMMISSION ON MILK 59
him or his representative, the actual testing results cannot and do not
represent the combined judgment of the two interested parties.
Since variations in the test represent variations in the price paid to or
received bv producers, it seems onh logical to suggest that producers should
have some direct say in the determination of the tests. In order that they
might have this say it would apparently be necessary for qualified testers
employed by and representing producers to actually participate in the
testing work at the distributor plants. The practical problem is how to
provide for this producer participation without at the same time bringing
about a duplication in the number of testers and therefore in the cost oi
doing the testing job. While this problem is by no means a simple one 1
do not think that it should be regarded as incapable of solution.
In comiection with this important matter I feel that serious consideration
might well be given to adoption in (3ntario of the plan that has been followed
for several years in connection with the milk sold by the Twin City Milk
Producers' Association which operates in the Minneapolis and St. Paul
district. Under this plan all the testing is done in the distributors' plants
but under the direct supervision of the producers' association. No attempt
is made to test every can or ever}' day s shipment of milk. Instead fresh
milk sani|jles of each producers' milk are tested four or five times each
month. This method makes it possible for four producer association
employees to do the entire testing job. While it is recognized that tests
vary from day to day and even from one milking to the next, experience
has shown that the average of a few tests taken during the period of a
month gives a highly reliable figure. In employing men as testers, care is
taken to see that they have had previous experience in testing work and
also to see that they are properly bonded. The bonding company investi-
gates the character of the employee for at least ten years prior to his
employment by the association. After he is employed the company keeps
in touch with him and, should anything develop to indicate that he is not
perfectly honest, the bond is cancelled. During the associations entire
experience there has been no evidence of dishonesty on the part of any
tester. «
According to the officials of liic Twin Cilv Producers' Association, this
method of dealing with the testing problem has been extremely satisfactory.
In fact it is looked upon by them as the real solution to that problem. There
is no doul)t that such a plan, if adopted in this province, would require a
considerably larger number of testers than the number employed by the
Twin City organization. On this point, however, it is well to remember that
several times that number of people are already engaged in check-testing
in the province. An alternative plan might be to have the testing done by
employees of the Milk Control Board rather than by those of the pro-
vincial producers' association. Such a plan would more or less parallel that
employed l)y the Dominion Government in respect to the grading of hogs
in the packing plants. All things considered, however, it would probably
be better to have the testing done by the producers' organization rather than
to entrust it to any government agency. It seems to me that there exists in
this sphere an excellent opportunity for the producer section of the industry
to practise the policy of self help.
SURPLUS MILK
If the Huid milk producer produces more milk than his distributor can
absorb for the fluid milk market, he has a surplus of milk on his hands.
60 ONTARIO ROYAL COMMISSION ON MILK
The price which he ohtains for this surplus milk is always an important
factor in determining the amount he actually receives for his fluid milk.
It costs him as much to produce and transport as the milk he sells at the
standard fluid milk price, and if the market for fluid milk cannot absorb
it he must sell it, if possible, as surplus milk. If he is not able to sell it,
it is a dead loss apart from the use to which he can put it on his own farm.
If he can sell it, he sells it at what is known as the secondary price which, in
the case of the fluid milk market, as has been stated above, is roughly $1.00
less than the prevailing price for fluid milk consumed as such.
Since surplus milk must be sold for much less than milk used for fluid
consumption, it follows that the average price for all milk produced is
reduced according as the surplus portion becomes a larger part of the total.
This means that, when the amount that must be sold at the surplus price
becomes at all significant, the satisfactory determination of that price is
just as important to the producer as the determination of the price which
is paid for that part of the milk which is sold for fluid consumption. While
it is undoubtedlv true that no use to which surplus milk can be put can
justify a price equal to that paid for milk consumed in the fluid form,
it does not follow that nothing can or should be done to eff^ect improvement
in the surplus milk price. On the contrary the very fact that the surplus
must be sold for less than the fluid price plus the other fact that the surplus
seems likely to constitute a very considerable and steadily increasing part
of the total production suggests that every possible effort should be made
to obtain surplus prices that are in line with the full commercial value of
this milk.
If one is to deal with the problem in detail, three kinds of surplus milk may
be mentioned.
The first is the seasonal surplus. Ordinarily a larger amount of milk than
at other seasons is produced in the lush pasture season during the months
of May, June and sometimes part of July. This surplus corresponds with
seasonal variations in farm production.
Secondly, there is a marginal surplus, that is, a surplus which a distributor
must buy to protect himself against day-to-day variations in supply and in
consumer demand. Tnder the present marketing agreements, if this milk is
used for fluid consumption it must be paid for at standard fluid milk prices.
There may also be mentioned a constant surplus, which is the amount of
milk available every month of the year in excess of the average daily con-
sumption by consumers together with the marginal surplus. This results from
over-production by the producer for the fluid milk market, but in practice
it is extremely difficult to control. As has been stated earlier, the fluid milk
producer has to arrange the management of his herd so that he has a
constant supply at all seasons of the year. He must arrange matters so
that he has cows freshening at different periods during the year rather
than the normal time, in the spring.
In addition there is always a large potential surplus. As appears bv the
figures of the Dominion Bureau of Statistics cited to me by the Hamilton
Milk Producers' Association, in the year 1945 fluid milk sales took only
26 per cent of the total of the milk produced in Ontario in that year.
Consequently, if fluid milk prices become profitable and consumer demand
increases, as it did during the war years, there is alwavs a tendencv for
those farmers who have not been previouslv producing for fluid milk con-
sumption to endeavour to enter the fluid producing field. This, of course,
also occurs when the prices realized for cream, milk for cheese factories,
and condensaries, falls sharply behind those paid for milk used for fluid
ONTARIO ROYAL COMMISSION ON MILK 61
consumption. There has always been a distinction between these prices
because by and large production of milk for cheese, butter and the con-
densaries has been a seasonal one in this countr)% but if the returns from
these are low there is always a temptation and an incentive to the farm
producing for these products to change and obtain entry into the fluid milk
market. With the generally increased demand for fluid milk during the
war years this is what occurred. While there has been some increase in
the average production per cow as the table cited above in this report shows,
nevertheless by and large the increasing consumer demand during the war
years was met by the entry of more and more producers in the Huid
milk field.
It is obviously much cheaper to produce milk at certain seasons of the
year than others. When the cows are on pasture the amount of feed and
feeding which has to be undertaken is sharply reduced. Nevertheless if the
producer is to effectively operate in the fluid milk field he must, as I have
said, arrange his production so that he has a constant supply throughout
the whole year, and this costs money. There is a great variation between
individual producers in this respect. The more efficient ones have reached a
stage where their supply is reasonably constant over the years; many others
have not attained this objective.
It is apparent that the problem of surplus is one of the most fundamental
ones to be faced by the fluid milk producer, and it is a cruel fact that the
more efficient a producer becomes and the more he reduces his cost of
production and increases his production per cow, the more likely he is tc
have a surplus on his hands.
Overhanging the fluid milk producer there is also the constant threat from
the greater body of farmers who produce what I have called the potential
surplus. As soon as the fluid milk producer gets himself in the position
where demand increases and he is able to obtain a lucrative price, he is faced
with pressure from other dairy farmers who may seek to enter the field.
The problem has been met in Great Britain by the formation of a marketing
authority, with which I will deal shortly. It is a problem, however, which
constantly overhangs and threatens the Ontario producer in the fluid milk
field. It must, I think, also be said that this threat is likelv to assume
constantly increasing proportions.
The efforts being made to improve dairy herds, of course, are not confined
to those producing for the fluid milk field, and over the years there appears
to be a steady increase in production per cow per farm, and this increase
appears to be more rapid than the increase in consumer demand for fluid
milk.
This problem assumed serious proportions in Ontario during the 1930s.
During the war years, with the amazing increase in consumption of milk by
consumers, it almost disappeared. It has now reasserted itself and is a
problem requiring the liveliest consideration by the producers of fluid milk.
The information reaching me is that during recent months it has steadily
become more serious, and the present situation appears to arise directlv from
the decrease in consumption since the increase in price in October, 1946.
Consequently it would appear that the producers must either take steps to
increase the demand for fluid milk by a decrease in price of standard milk
which would reflect in presumably lower consumer prices, or bv finding other
and more profitable ways of disposing of the surplus. In respect of this
whole matter reference may be made to methods adopted in other jurisdic-
tions. In the Montreal milk market, the Montreal Milk Producers' Co-
operative Agricultural Association some thirteen vears ago undertook to
62 ONTARIO ROYAL COMMISSION ON MILK
process and sell the members' surplus milk, Lp to that tune, like the
Ontario Milk Producers' League, the Association had been a purely protec-
tive group financed by its own members. In January 1935 a plant was
opened by the Montreal Association for the handling of surplus milk, and
it has been stated that in the first year of operation ending in December, 1935,
the plant handled 9,000,000 pounds of milk and that the returns to member-
producers were much better than they had obtained for their surplus under
the old system. In 1941, some 31,000,000 lbs. of milk were handled, and
i:i 1946 a second plant was opened. The Association apparently takes all
s^urplus milk from its member producers. This milk is then handled accord-
iiig to current requirements without competing with distributor dairies. If
the dairies are short of milk, it is sold to them at standard prices, butter is
manufactured and also sold to dairies, and from the skim, milk powder and
casein are produced.
It was stated in a local publication recently that in the twelve-month period
ending December 15, 1946, the Association received 16,855,840 pounds of
milk, and from this manufactured 195.771 pounds of butter, 685,587 pounds
of skim milk powder, and some 174.248 pounds of wet casein. Incidentally,
it may be mentioned that included in the milk handled is milk supplied by
Ontario producers living in the most easterly part of the province supplying
the Montreal market.
Payment to the members, that is the producers supplying the milk, is made
on a basis of butter-fat content, and is made on the 15th of each month for
the preceding calendar month. In 1946 it is said that an average of 62.9
cents per pounds was paid for butter-fat, and during the first month of 1947
this materially increased. Included in this price, of course, are the current
subsidies from the Dominion Government and this fact should be borne in
mind. At the present time I am advised that the Toronto Milk Producers'
Association has initiated steps whereby some similar operation may be
developed. In my view this is a step in the right direction.
The Fraser Valley Milk Producers' vVssociation, which supplies fluid milk
to the Vancouver market, is another organization which has developed an
independent program designed to yield as large returns as possible from the
disposal of surplus milk. This organization has owned and operated a num-
ber of processing plants for a good many years, with the result that the
average returns obtained from the disposal of its surplus has been ver^
materially increased.
Still another example of a long and successful producer attempt to cope
with the surplus problem is found in the case of the Twin City Milk Producers
Organization which operates in the Minneapolis and St. Paul area of the
United States. From the time it was organized some 31 years ago, the Twin
City Milk Producers undertook to handle and dispose of all milk supplied
by its members. In recent \ears considerably more than half of all milk
supplied has been processed by the organization into one or other of several
products. The organization owns and operates a dozen or more processing
plants throughout the producing territory. The list includes several cheese
factories, condensaries and one or more creameries.
The general experience of this organization in the handling of surplus milk
has apparently been extremely satisfactory, particularly in more recent vears.
At the time the British Marketing Scheme was inaugurated in 1933 the
British producers were facing similar conditions. There was and is this
difference, however, between the situation in Britain and that in the Province
of Ontario, nanieb . whereas around 70 per cent of all milk produced in
Britain was consumed in the fluid form, the most recent corresponding figure
ONTARIO ROYAL COMMISSION ON MILK 63
for Ontario is around 26 per cent. Since the advent of the war years the
percentage consumed in the fluid form in Britain has risen to 90 per cent
or better. This difference between the situations in the two countries means
that the fluid milk producer would be called upon to accept a considerably
lower average price in Ontario than has been true in the case of Britain.
The details of the British Marketing Scheme, however, merit the closest
attention.
As I have said before. I think the salvation of the fluid milk producer,
if he is to get a better returji. lies in his own hands. l)ut it does not lie for
the most part in his personal efforts. If. through associations like the
Ontario Whole Milk Producers" League he can co-operatively build up
methods of handling his surplus product, he will unquestionably in the long
run be in a much stronger position and obtain better results. If the producers
as a class do not so further extend their organization, I see little hope for
improvement in their economic position. The\ are always going to be selling
in a buyer's market.
MAINTENANCE OF CONTROLS FOR THE BENEFIT OF THE
PRODUCER
During the course of the enquiry questions were put to most producer
witnesses as to the necessity from their standpoint of maintaining the type
of controls set up in the Milk Control Act. With complete unanimity they
declared themselves in favour of the maintenance of the type of control
exercised by the Milk Control Board in respect of producer prices. Thev
were satisfied that if this backing of their price arrangements were removed,
the chaotic conditions which occurred in the earh 1930s and which led to
the passing of the Milk Control Act and to the setting up of the Milk
Control Board would inevitabh reoccur.
It can be repeated that originally the Milk Control Act was passed for
the benefit of the fluid milk producers who were at the time in a very
depressed condition. It is true that their organization, the Ontario Whole
Milk Producers' League, is now in a much stronger position than it was in
1933 and 1934. Nevertheless the universal opinion of those connected with
the business of producing fluid milk was that the\ were not vet strong enough
to preserve their bargaining position uidess their efforts had the sanction of
government authority and enforcement behind them. With this view I think
1 must agree. One cannot peruse the reports dealing with similar problems
in other jurisdictions without finding almost universal agreement on this
point, and from the nature of the facts in the case the conclusion seems
inescapable.
If there is not a fixed \n'icp to the producer with the sanction of a law
behind it, 16.000 or more individuals, no matter how organized, will always
contain a minority who are prepared to break away and cut prices or give
secret rebates to distributors. It is unquestionably true that the more
reputal)le distributors will not engage in this kind of business, nevertheless
experience in this and other jurisdictions has demonstrated that there are
always some who will do so. In the result, particularl) in periods of
declining demand or expanding supph beyond market requirements, a
situation approaching that which obtained in the early 1930 years will
probably reoccur.
It has been suggested that the control is too elaborate, and that the situation
might be met by the setting up of schemes throughout the province under
the provisions of The Farm Products Marketing Act 1 1946 I. This Act. and
64 ONTARIO ROYAL COMMISSION ON MILK
The Farm Markets Control Act which preceded it, has operated largely in
connection with certain fruit and vegetable crops, such as tomatoes, sweet
and sour cherries, asparagus, etc. It will be noted that these are seasonal
products and do not involve year-round distribution. It has also operated
in connection with cheese, which again is produced on a seasonal basis and
Avhich, if properly kept, can be preserved for a considerable period of time.
There is, I believe, at the present time, a move on foot to establish some
such scheme in connection with the sale of fluid cream to creameries for
butter-making purposes, and it will be interesting to see how this operatet*.
It may be that this will indicate the degree to which this legislation is
applicable to a product such as fluid milk. It should be remembered,
however, that the great part of Ontario butter is produced in the spring and
summer months. There are, of course, a very great number of fluid milk
markets in the Province and in many cases they overlap. Under the stress
of the demand of the war years large markets such as those of Hamilton
and Toronto reached out in all directions for supplies of milk, and in Oxford
and Middlesex Counties it is possible to find farmers side by side who are
shipping to London, Hamilton, Brantford and Toronto. This state of affairs
was, I am advised, present to some degree even prior to the war.
Insofar as fluid milk is concerned, there is a necessity for a constant
supply throughout the year and the maintaining of a uniformly high standard
of quality.
It is in no sense a seasonal product. It is also a highly perishable product
that can be preserved in its original form for very short periods only. The
cost of producing it. particularly when the costs of labour and purchased
feeds such as mineral concentrates is considered, can change drastically from
time to time on very short notice.
There are also a large number of markets for fluid milk in the province.
These considerations would, in my view, make the application of The Farm
Products Marketing Act in its present form a very cumbersome and com-
plicated matter. The type and degree of administration and supervision
which would be called for would be vastly different from anything envisaged
by any of the schemes presently in operation under this act.
It would also appear that the difficulties of enforcing these schemes might
be considerably greater than the agreement under which producers operate
under the authority of the Milk Control Board, and in the final result I
question whether more would have been done than to replace the Milk Control
Board which in its present work is a specialized body dealing with a very
large and important industry by loosely organized Boards under the Farm
Products Marketing Act. While there would be general supervision by the
Farm Products Marketing Board, it would have to consider not only many
delicate and intricate problems of the dairy industry but the problems
associated with the other schemes already set up under The Farm Products
Act. The experience of the Milk Control Board indicates their difficulty in
adequately regulating the fluid milk business alone.
As will appear in the chapter dealing with Milk Consumption and the
Consumer, there is articulate demand for more effective consumer representa-
tion on the Milk Control Board in respect of its price-fixing functions.
The Farm Products Marketing Act makes no provision for the representation
of such an interest. It would appear to me that the problem of enforcement
would be much more difficult. This was certainly the opinion of
the producer witnesses I heard. Generally speaking, the function which
ONTARIO ROYAL COMMISSION ON MILK 65
would have to be performed would be substantially similar to those already
undertaken or which should be undertaken by the Milk Control Board.
And it is open to question whether any saving would be effected in such an
administration when compared with the present arrangements.
Until the producers are organized in a more comprehensive way than thev
are at present, it seems to me that as a class they have neither the bargaining
power to deal on anything like equal terms with distributors generally, nor
the capacity to protect themselves from the operations of unscrupulous
distributors in particular. If, in the final result, as will be suggested later,
they were able to organize themselves into a marketing authority which
would have control of the sale of their products; then obviously many of
the functions now performed by the Milk Control Board might well be
performed by such an authority. In my view this would be a much healthier
position for both the producers and the general economy at large. However,
until the producers as a body are prepared to so organize themselves, my
opinion would be that they need the authority of some such body as the
Milk Control Board to help establish the prices for their raw products and
enforce them after they are established.
At the final hearings in Toronto there was filed a formal expression of
opinion of the Ontario Whole Milk Producers' League in connection with
this and other related matters, and it is set out in Appendix 15.
If circumstances changed and it was decided to try to operate the producer
end of the fluid milk business under the provisions of The Farm Products
Marketing Act, I would suggest that careful attention be given to the pro-
visions governing and the procedure followed in marketing milk in the
State of New York. Many provisions similar to those found in the New
York statute and the regulations might well have to be considered. A brief
summary of the scheme as it operates in New York was filed before me and
from additional investigation I believe presents a brief but accurate picture
of its operation. It was stated to me as follows:
NEW YORK STATE MILK MARKETING SCHEME
"The milk marketing scheme has been in effect in the State of New York
for many years and takes the form of various regional schemes in that they
are known as Milk Marketing Areas. Under the provisions of the State
of New York Agriculture and Markets Law the Commissioner of Agri-
culture and Markets is entitled to issue an official order to regulate the
handling of milk produced for sale in an area defined by the said order
and known as the milk marketing area. The official order so issued
includes detailed regulations for the handling of milk in the area, fixing
of the price to be paid for the various classes of milk produced, the
licensing of producers, marketers, collection co-operatives, milk plants,
distributors, etc. The actual sale of milk is principally handled through
pooling plants which are licensed by the Milk Administrator appointed
under the Act. The Milk Administrator has the duty to fix the price for
all milk produced for sale in the area fixing the same bv the purposes
for which the milk is used and fixing also the haulage costs and other
charges to be made by milk handlers and milk producers. The actual
payment for all milk sold is made individually by each distributor or
processor to the producer but in many areas collecting co-operatives have
been established which collect for all milk sold through them and in
turn make payment to their producers."
66 ONTARIO ROYAL COMMISSION ON MILK
CURRENT PRICE RECOMMENDATIONS
In respect of the prices to producers arrived at under agreement made
between the producers and distributors in September of 1946, which
initiated the present price structure to the consumer, it will be observed that
since this price increase, owing doubtless in part to the increase itself,
to the changing economic conditions arising in the after-war period and
to the pronounced increase in the cost of living generally, the consumption
of milk between May, 1946. and May. 1947, has decreased approximately 10
j)er cent. However, comparing September, 1946, the last month before the
price increase, with May, 1947, there is in May an increase in consumption
of 2.7 per cent. In my view this indicates that under present conditions ol
large volume consumption, any increase in price to the consumer will only
result in a further decline in demand from consumers.
This, I believe, is recognized also by the Whole Milk Producers' League.
In the presentation of their brief at the sittings of this Commission held in
Toronto, they formallv abandoned their request for any higher producer
price at the present time. This was done despite the fact that they had filed
a brief indicating that the price of $3.45 per cwt. for standard milk in
the Toronto markets was not sufficient to meet their average costs of pro-
duction. This position was taken, in my opinion, because decreasing
demands were resulting in substantial increases in the amount of surplus
milk. This could only be expected under the conditions prevailing. After
some years of capacity demands it again brought very forcibly to the
attention of the producers the fact that the price they could obtain for their
product in the long run must be modified in the light of consumer demand
as well as their own costs. As Mr. A. E. Coleman, an accountant employed
by the Toronto Milk Producers' Association said: "Quite a considerable
jjortion of the milk going to distributors was now surplus milk and paid
for at surplus prices." As he observed, speaking of the surplus milk
situation in the vear 1947: "Quite a considerable portion is coming in
much earlier this vear than in previous years."
Mr. R. F. Lick, the Secretary-Manager of the League, was asked by
Commission Counsel Avhether his association and the distributors' associa-
tion were in agreement with prices as they now exist and he said yes, and
he had no further recommendations to make as to the present price paid
producers.
Mr. Fenton Maclntyre, the President of the Whole Milk Producers'
League, was asked by Commission Counsel whether at the present moment
he felt that .S3.45 per cwt. price in the Toronto market was a reasonable
price, and whether, speaking as of that date, that is March 1947, the object
was to hold the line at that price. He stated that it was.
In the result, therefore, I think it must be said that no increase in the
standard price of fluid milk to the producers can be recommended at the
present time. Any further decrease in consumption will inevitably result
in a larger supply of surplus milk in the hands of the producer, with a
corresponding decline in the average price which he receives.
In the result, therefore, it would appear that, despite his apparent cost
position, the producer has reached a maximum price under present con-
ditions. There is an urgent necessity on him to further reduce, if possible,
his cost of production, or to discover, as has been previously indicated, more
lucrative ways of disposing of his surplus milk. His salvation lies sub-
stantially in his own hands, and as I see it, it is only through enlarging the
functions and capacities of the Ontario Whole Milk Producers' League,
ONTARIO ROYAL COMMISSION ON MILK 67
tliat there is any real hope for the producer obtaining better returns.
Producers as individuals can, of course, obtain some relief to the extent
that more efficient production methods can be followed. There are man\
ways of achieving this objective. For example, something substantial has
been done, and more will probably be done in future, in improving the
dairy herds of the province through the introduction of improved Ijlood
strains. One of the avenues of approach to this is the setting up of artificial
insemination stations, which in certain parts of the Province has been
done by groups of farmers co-operatively. Another method of improving the
quality of the herds is that undertaken by the dairy farmers of Essex County
who. in conjunction with the Ontario Department of Agriculture, have
employed an expert to keep production records for a selected list of herds,
and as a result of his over-all experience to suggest better means of improving
both feeding and breeding of dairv animals.
There are countless ways in which the dairy farmer can improve the
efficiency of his production but it is. I think, obvious that in a great man)
cases any improvement jnust come through joint and co-operative efforts
of himself and other dairy farmers. ProbabK the best source of information
in respect of such methods is available through the work of the Ontario
Agricultural College, and through expanded research and assistance generally
to the producer on the part of the Ontario Whole Milk Producers' League.
As I have said before, there is in my opinion a verv definite obligation
on the dairy farmer to pursue these objects. In the public interest he is
not entitled to have the protection of government authority for the prices
paid him unless he, on his part, is prepared at every opportunity to reduce
the cost of his product which, in itself, is a necessity for the consuming
public in the province at large. In any event, increased efficiency in pro-
duction is always in the general interest.
MARKETING SCHEMES
One cannot examine the producer's general position without coming to the
conclusion that the eventual solution of the difficulties facing whole milk
producers, and probably all milk producers in the province, lies in the
setting up of a marketing organization that will control the disposal of all
milk produced by fluid milk producers for the fluid market, and ideally of
all milk produced in the province.
From the evidence that I have heard, this seems to be an inescapable
conclusion. Nevertheless, equally from the evidence, I can only say that at
the present time I question very much whether the farmers in Ontario in
general, or the whole milk producers in particular, are readv for such a
drastic move. However, in my opinion it is the ultimate and onh effective
solution of their marketing difficulties.
It was notable that the criticism directed at this proposal by the distributor
Avitnesses was based chiefly, if I may say so, on sentimental grounds. What
they particularly regretted was the severing of the intimate personal ties
that had grown up between producer and distributor. Nevertheless, I think
the facts of the case render such a divorce desirable, and economicallv speak-
ing almost imperative.
Various schemes have been proposed, and thinking among the whole milk
producers at least has reached a point where some such scheme is being
seriously contemplated and studied. It. undoubtedly, plays a larger part
ni the thinking of those producers supplying the condensaries and cheese
factories. The supplementary brief filed before me on behalf of the Ontario
Concentrated Milk Producers' Association discussed at some lenjrth the milk
68 ONTARIO ROYAL COMMISSION ON MILK
marketing scheme in force in the United Kingdom, and in conclusion the
brief suggested that some scheme of milk marketing was necessary for the
welfare of Ontario milk producers, and stated:
"(1) THAT a marketing scheme for all milk produced in Ontario would
appear to be desirable for the general welfare of the dairying industry.
"(2) THAT in the time available to the Commission it is impracticable to
formulate a scheme which would be suitable to Ontario conditions.
"(3) THAT it would be desirable for the Ontario Department of Agricul-
ture to commence immediately a thorough study of Milk Marketing
with a view to propounding a scheme suitable to Ontario conditions
and in such study the Department should co-operate with the joint
Ontario Committee already established by the different producers'
associations."
I question whether thinking has progressed far enough among the milk
producers of Ontario to justify the establishment of such an all-embracing
scheme as yet. On the other hand, I would suggest that a commencement
might be made by establishing a marketing scheme with the force of law
behind it in selected areas in respect of those producing for the fluid milk
market. Such a scheme might be handled under the direction of the Milk
Control Board or might be more effectively worked out by the Ontario Whole
Milk Producers' League itself with whatever government assistance and back-
ing, particularly in respect to enforcement, which might be found necessary.
It is quite true that in comparing conditions in Ontario with those of the
United Kingdom, one has to remember that in the United Kingdom there is a
serious deficiency of dairy products and that generally speaking the country
is always on an import basis in respect of them. The position in Ontario is
different in that a large amount of cheese and milk manufactured in Ontario
is sold outside of the province, either in the other provinces of the Dominion
or overseas. These differences, however, do not affect the fundamental simi-
larity of the producer problems existing and the basic solution required. Any
differences which exist are primarily matters of degree and affect the tech-
nique of marketing the product rather than the general principles
involved. There are. of course, very elaborate provisions in the English
scheme in respect of the administrative organization, and it may well be
that these would require some modification to meet the special needs of
Ontario conditions, but so far as the basic plan itself is concerned I would
recommend it as a model for studv and possible imitation.
In the five-year review of the milk marketing scheme in the United King-
dom, published by the Milk Marketing Board in 1938, it is stated:
"By 1932 the bargaining strength of producers had weakened consider-
ably. There was under-cutting in the retail market; prices of imported
butter and cheese had declined to such an extent that manufacturers at
home could not compete, and much of the milk normallv used in cream-
eries was sold on the liquid market at very low prices.
"The whole price structure of the industry was rapidly becoming
imstable, and it was eventually realized that recovery could not be achieved
through voluntary efforts."
I think these words might have been said with equal truth of conditions
in Ontario in the years 1933 and 1934. It is quite clear that at that time
in the United Kingdom the sale of milk was unremunerative to a large
number of dairy farmers, and that the increasing pressure of producers on
remunerative markets was becoming a dangerous factor making for even
more serious reduction of prices.
ONTARIO ROYAL COMMISSION ON MILK
69
The result of this situation was an investigation by a Commission under
the Chairmanship of Sir Edward Grigg, which finally resulted in the setting
up of the scheme under the provisions of The Agricultural Marketing Act of
1931. This was preceded by a poll of milk producers in which some 96
per cent voted in favour of the scheme. Quite obviously no such scheme
could be successfully organized in Ontario unless it had the support of a
very large percentage of the producers.
Executive authority under the British scheme is vested in The Milk
Marketing Board, which consists of fifteen producer-representatives with two
independent members who are co-opted after consultation with the market
supply committee. The scheme provides for the election of Board members
by the producers themselves. Twelve are chosen from the regions into which
the country is divided, while three are special members elected by a national
vote of the producers. For purposes of administration the country is divided
into eleven regions and for each region there is allotted a committee consist-
ing of county representatives of milk producers. These regional committees
act in an advisory and consultative capacity to the Board and they are
brought together when matters of major importance arise.
While this scheme has been modified in some respects by war conditions
in the United Kingdom, it still continues to function effectively as an instru-
ment of the producers themselves.
The principal powers of the British Milk Marketing Board are laid down
in detail in the Scheme, and may be summarized briefly as follows: —
(a) To prescribe the description of milk which may be sold, its price, the
persons who may sell it, and the terms on which it may be sold;
(b) To regulate the grading, packing, storing, adapting for sale, insur-
ing, advertising, and transportation of milk on behalf of producers;
(c) To exempt any class of producers from the operation of the Scheme.
(Any producer not so exempted is subject to the regulations of the Board) ;
(d) To impose penalties upon producers contravening the regulations.
The Board also has various other powers, such as the right to buy and
sell milk, and to encourage and promote agricultural co-operation, education
and research, etc.
The Board has regulated the sale of all milk produced in England and
Wales, with the exception, for a period, of the "Certified" and "Tuberculin-
Tested" grades, and supplies from certain small producers.
Regulation is in two main directions: —
Milk sold wholesale by producers to distributors is regulated by means
of an annual contract setting out the prices and the conditions of sale.
Milk sold retail by producers themselves is regulated by means of a
licence issued by the I3oard. The licence sets out the minimum retail
prices below which the milk cannot be sold as well as the conditions to
be observed in the sale.
These have been the two principal channels of control from the outset
and they are the foundation of the whole fabric of organised milk marketing
in England and Wales.
Powers are granted to the Board in the terms of the Scheme for the
determination of the prices of milk. Before prices are prescribed, however,
the Board must consult those who are best qualified to express the views
of the buyers of milk. In practice the consultative body has been the
Central Milk Distributive Committee, a voluntary organisation representative
of all buying interests.
70 ONTARIO ROYAL COMMISSION ON MILK
In luv upinion the recommendations made to the Commission on behalf
of the Concentrated Milk Producers' Association deserve very serious stud)'
and consideration. I question whether all farmers producing milk in
Ontario are readv for the all-over control of the type adopted in 1933 in
(ireat Britain. I would suggest, however, that those farmers producing for
the fluid milk market might well initiate the first stages of such a scheme.
[ would also suggest that the larger aspects of the matter be considered and
worked out without any great delay by the recently formed Joint Committee
representing all four sections of the Dairy Producers.
The producer situation in Ontario has been bettered by the administration
of the Milk Control Board, but it can be improved to a far greater extent
through the adoption of some such scheme as I have indicated. Whether
such a scheme should be operated by the Whole Milk Producers' League or
as a part of the administration of the Milk Control Board, is a question
depending on the direction of overall policy in respect of these matters.
It will be dealt with in this light in the final chapter containing recom-
mendations.
ONTARIO ROYAL COMMISSION ON MILK 71
CHAPTER VI
Transportation of Fluid Milk
( 1 ) General
The transportation of milk for fluid trade from a producer's farm to the
distributor's plant is an important factor in the ultimate cost of milk
delivered to the consumer. In the Province of Ontario at the present time
all but a negligible proportion of milk for the fluid trade is transported by
motor truck and generally by some one whose sole business is the haulage
of fluid milk from producer to distributor. On the average, three-quarters
of a cent out of the price paid by the consumer for each quart of milk has
been devoted to the transporting of that milk from the farm to the dairy.
If this sum represents the cost of bringing an adequate supplv of milk of a
proper quality to the market, avoiding excessive waste and duplication of
effort, then it represents a fair charge to the consuming public, and it is
from this point of view that the problem will be examined.
I 2 ) Legislation and Regulation
The transport of milk by motor vehicle is governed bv the Commercial
Vehicle Act, R.S.O. 1937, Chap. 290. and the regulations passed to implement
this Act. With the exception of a farmer who chooses to haul his own milk
to the dairy, any person or firm desiring to enter such a business is required
to apply to the Minister of Highways for a Class "E" license under this Act.
The applicant is required to specify the route that he proposes to serve and
to produce evidence that the public need for such a service is not being
adequately met by existing licensees. The application is then referred to the
Municipal Board for consideration and the Municipal Board in turn, having
notified any interested producer and distributor and transport organizations
already in the area, refers the application to the Milk Control Board for
approval or otherwise. If the Milk Control Board opposes the application
it is my understanding that such application is invariably refused. The
foregoing limitations a|)ply with ecjual force to a producer who undertakes
to haul, in addition to his own milk, that of his neighbours, and equally to
a co-operative venture by a group of farmers. With the exception of three
organized markets, this is the extent of control now exercised over this
part of the industry.
In addition to The Connnercial Vehicle Act and its regulations, the trans-
porter of milk is subject to the regulations passed pursuant to the Milk
Control Act. R.S.O. 1937, Chap. 76. Each transporter is required to obtain
from the Milk Control Board an "M" license annually. Section 15 of the
regulations under the Milk Control Act provides that "no licensed transporter
shall change his route, add new shippers of milk or transfer shippers from
one plant to another unless the change has been approved by a joint milk
transport committee recognized by the Board for the market, or permission
has been secured from Board."' this regulation, which in effect freezes the
organization of milk routes throughout the province, automatically makes
the haulage of milk a matter of importance to the producer and distributor
as well as the hauler.
72 ONTARIO ROYAL COMMISSION ON MILK
(3) Organized Markets
In the Toronto, Hamilton and Guelph markets agreements have been
entered into which have been approved by the Milk Control Board, setting
up a joint transport board for each of these areas and specifying the rates
to be charged for the haulage of milk to these markets. The Milk Control
Board Order relating to the Toronto market is No. 39-15 effective June 1st,
1939. and is, for easy reference, attached as Appendix 16 to this report.
The Order relating to the Hamilton market is No. 45-12 and that relating
to the City of Guelph is No. 46-6. In each of these areas a joint committee
on milk transportation has been authorized and appointed, consisting of
15 members in the Toronto market and 9 members in each of the Hamilton
and Guelph markets. The Local Milk Producers' Association, The Local
Milk Distributors' Association and The Local Milk Transport Association
each appoint an equal number of members to the joint committee. These
committees operate as boards of arbitration to deal with differences between
the producers and shippers and to deal with the question of variations in
rates as between producers and individual shippers, and generally to bring
such rationalization to the trucking industry as is possible. The evidence
indicates that, generally speaking, these joint committees have worked
satisfactorily and have been of considerable assistance in the organization
of this important department of the milk industry.
(4) Transporter
To understand the problems involved in any administration of milk
transport, it must be realized at the outset that over a period of years each
milk route has become a vested interest, a definite commercial asset of the
owner of such route, having a value in the Toronto milk shed which may
be calculated on the basis of $80 to SlOO per can including equipment.
Routes are readily saleable at such prices.
For convenience the Toronto milk shed will be referred to frequently,
because it is an organized market and also because of the fact that it repre-
sents 31 per cent of the total fluid milk market in the Province of Ontario.
In this market approximately 3,727 producers ship 14,570 cans of milk
by truck every day. In addition, one company receives milk by rail from
time to time. In the month of May, 1947, 1,081 cans, or 35 cans per day
on the average, were shipped by rail from the Woodstock receiving plant
of this company to its Toronto dairy. The amount shipped by rail in this
market is obviously negligible, but for comparative purposes it may be
noted that the baggage and haulage costs are less than twenty cents per
80 pounds, whereas by truck the rate from Woodstock would be thirty cents.
There are some 88 independent operators trucking milk into the City of
Toronto, of which 54 are single truck operators, usually driven by the
owner, and the balance of 34 transporters operate from two to eight trucks,
making a total of approximately 169 vehicles. In addition to the independently
operated transports, there are some 39 vehicles owned and operated by
distributors in the City of Toronto. These 218 vehicles, ranging in size
from under three-ton capacity to over ten-ton capacity, travel daily distances
up to 100 miles from the City of Toronto to transport fluid milk for this
market. In the month of May, 1947, the milk transported by truck into
this market represented the following distances, rates and from the number
of shippers and in the volume shown below.
No. of
No. of
shippers in
cans in
zone rate
zone rate
232
31,070
761
85,938
574
69,712
945
113,109
616
73,933
459
58,774
17
1,937
44
5,737
52
6,237
4
464
ONTARIO ROYAL COMMISSION ON MILK 73
Truck Rate
Distance Per 80-lL. can
15 miles and less 18c per can
For 20 miles and over 15 miles 20c
For 30 miles and over 20 miles . 23c
For 45 miles and over 30 miles 25c
For 65 miles and over 45 miles 28c
For 90 miles and over 65 miles 30c
Over 90 miles at 32c
Over 90 miles at 33c
Over 90 miles at 35c
Over 90 miles at 40c
3,704 446,911
(a) For distances over 90 miles the rate is not fixed, but is subject to
agreement between producer and trucker.
(b) In addition to the foregoing, 23 producers haul their own milk to
the Toronto market to the extent of 4,815 cans daily.
(c) The figures quoted above were from the records of the Toronto Milk
Distributors' Association.
From the foregoing figures it will be seen that, apart from the small
number of producers who truck their own milk to the market, 566 shippers,
or 15.3% of the total send daily 73,149 eighty-pound cans, or 16.3% of the
total daily shipment, and these shippers and this amount of milk come from
distances in excess of 65 miles from the City of Toronto at a cost of 30c
or more per eighty-pound can, which practically speaking is the equivalent
of one cent per quart. This means that a substantial proportion of the
daily milk requirements of the City of Toronto comes frpm farmers
beyond Port Hope, Lindsay, Shelburne, Guelph. Paris and Brantford.
It may be that, were it not for the fact that the producer bears the
initial cost of shipping, and that so long as the producer supplies a steady
volume of milk of suitable quality, the distributor has no interest in the
distance which the milk has to travel before reaching market, producers
would be found considerably closer to the market than is the case at present.
Bulletin No. 417, dated June, 1941, of the Ontario Department of Agri-
culture, is a study of milk transportation in the Toronto milk shed made by
the Economics Department of the Ontario Agricultural College and the Milk
Control Board of Ontario, and represents a detailed studv for the vears
1938-39 of milk transported into this market. I am informed by Counsel for
the Toronto Milk Transport Association that. Avith the exception of the
changes resulting from an increased number of shippers f3,727 in 1947 as
compared with 3,127 in 1939) the volume of milk hauled daily (14,570 cans
in 1947 as compared with 8,972 in 1939) and the general increase in costs,
etc., resulting from wartime conditions, the observations made from that
study with reference to duplication of service, the effect of capacity loads and
concentration of shippers on routes, are as valid to-day as they were in 1939.
At that^time there were 161 milk routes in operation as compared with 208
m 1947, and for the purposes of the studv 89 routes operating in different
zones were examined in detail. The vehicles operating on these routes
travelled daily 3,455 miles. On 1.562 of these miles there was onlv one truck
operating, on 291 miles two trucks, on 162 miles three trucks, on 93 miles
four trucks, on 71 miles 5 trucks, and on 17 miles six trucks. These mileages
74 ONTARIO ROYAL COMMISSION O.N MILK
are the mileages covered from the time of the first pickup of milk to the
last, and do not include what is called "bobtail" mileage or the distance
travelled from the distributor to the first shipper and from the last shipper
back to the distributor. The overlapping pickup mileage amounted to 1.260
miles daily and the overlapping bobtail mileage to 2,064 miles. The
economist studying the matter at that time had this to say of this overlapping
service :
"It will, therefore, be seen that because of overlapping service on about
30% of the roads and because of the use of unnecessarv trucks, a total
unnecessary daily mileage of 3.324 miles is travelled. This estimated
unnecessary mileage amounts to 22% of the total mileage travelled, and
at ten cents a mile puts an extra daily cost of 8332.40 on the cost of milk,
or an extra and unnecessary cost of 8120,326.00 each year."
It may safely be assumed that there has been no diminution of overlapping
service. No over-riding authority has directed the rationalization of milk
hauling routes, and any changes that have been made have been the result
of arrangement between individual truckers, trading shippers for their own
convenience, and represent isolated cases only.
The evidence before me, both from producers and transporters, indicates
that the truck driver himself plays an important part in the human relations
between producer and distributor. In the brief of the Toronto Milk Trans-
port Association, the following appears:
"In the majoritv of cases it would be found that the trucker was respon-
sible for bringing the producer and the distributor together. The dairy
required milk, the trucker searched the country for it; the farmer desired
a market, the trucker found a dairy for him. In many instances the farmer
has never been to the dairy nor met a dairy representative, and similarly
no one from the dairy has been at the farm. If the farmer has a complaint
as to an error in his milk statement, his test, rejected milk, etc. the trucker
is the first to learn of it, and the farmer has expected him to save him a
trip to the city by looking after his difficulties for him. This he gladly
does. In the case of rejected milk he goes to the farm at milking time to
watch and see if he can make any suggestions that would eliminate the
trouble — and generally he can. Additionally, he gladly does many little
personal favours, such as bringing in a broken part, leaving it to be fixed,
and returning it, or picking up some items urgently needed, etc."
The foregoing, in my view, overstates the case to some extent, since the
larger and more progressive distributors maintain a field force which makes
direct contact with the producer. There is no doubt, however, that the
truck driver, as a person, does represent an important human link in the
chain between farmer and consumer. He is in eflfect the only real middle
man in the industry. Lnder the regulations of the Milk Control Act, quoted
above, even in those cases where there is a duplicate service, if a producer
is dissatisfied with his trucker, or a trucker wishes to make an alteration in
bis route, changing shippers, this can only be done on consent of the Milk
Control Board. Consequently, in view of the regulations, the personal
relationship existing between trucker and producer, the vested interest of
the trucker in his route, and the effect of practices establishd over a number
of years, there is little, if any. encouragement to rationalization of trans-
port routes to eliminate waste. Although the cost of the transport of milk for
the m.ost part represents only a fraction of a cent per quart, in the aggregate
it represent a very large sum annuallv which comes out of the consumer's
ONTARIO ROYAL COMMISSION ON MILK 75
pocket. Hence, in my view, action should be taken to overcome the tendency
to preserve the status quo and to eliminate waste and duplication where
possible.
The Toronto Milk Transport Association, in Exhibit "D" to their brief,
submitted an auditor's report covering 20 truckers into the Toronto market,
showing comparative figures for 1939 and 1945. These truckers operated
55 trucks in 1939 and 68 in 1945. representing approximatelv one-third of
the total. The auditor for these truckers reports that "Operating costs have
increased from 20.45 cents per can in 1939 to 22.75 cents in 1945. Profit
per can has dropped from 3.40 cents per can in 1939 to 1.42 cents in 1945.
, . . While in 1945 revenue had increased 47.98 per cent over 1939, certain
expenses had also increased in a much greater proportion, e.g., gasoline, oil
and grease, 70.94 per cent; truck repairs, 178.51 per cent; tires and tire
repairs, 160.32 per cent; and wages, 77.93 per cent." For these twenty
operators a total cartage revenue of .S365.004.21 was received in 1945, as
compared with $246,654.68 in 1939. In 1939 the net profit of these
operators, before income tax, amounted to S35,102.70 or 14.24 per cent of
revenue, and in 1945, to $21,526.48 or 5.90 per cent of revenue. The sig-
nificant fact is that in the face of sharply increased costs, and without any
change in haulage rates, the increase in volume hauled by these truckers
enabled them to continue to show what on their own figures may be con-
sidered a very handsome profit. What additional benefits they might have
derived as the result of a general rationalization of routes and a concentra-
tion of shippers, with resulting elimination of unnecessary and waste mileagi-.
can only be conjectured, but it seems only reasonable to assume that such
changes would have permitted these operators to show an even larger volume
of profit in 1945.
The foregoing figures, as stated, have been taken from the evidence sul)-
mitted bv the 'i'oronlo Milk Transport Association. These figures should be
compared with the report of Mr. John S. Entwistle. attached as Appendix I 7.
The rates fixed for transport haulage, either by agreement approved b\
the Milk Control Board in the case of organized markets, or by direct agree-
ment between producer and trucker in other areas, are collected by the
distributors by means of deductions made from the purchase price of the
milk received by each distributor from each producer, and are paid to the
trucker by the distributor. Thus, where a rate or a price has been fixed
for 100 pounds of fluid milk at, say, $3.60. this represents the gross rate to
the producer, but out of this the trucking rate must be paid. Hence the cost
of trucking is always calculated bv the producer as a part of his cost. There-
fore it may be taken that the transporter is the agent of the producer for
the purpose of carrying the producer's milk to the distributor and. as stated
above, the distributor has no interest in the distance which milk is trans-
ported since the price which he must pav to the producer is fixed for the
market where it is sold without regard to the location of the producers
farm. Similarly the decision as to how much, if any, surplus milk any
producer ships to the dairy is that of the producer alone. In times of lush
production a producer having no other outlet for his surplus milk may use
a substantial part of trucking space for the carrving of milk destined for
other than the fluid market. The trucker is his agent and the farmer can
employ him as he sees fit. It would seem to follow that this factor ma\
tend to cause the employment of more transport service in any particular
market than the fluid trade alone requires.
76 ONTARIO ROYAL COMMISSION ON MILK
(5) The Producer
As will be seen from the foregoing, the producer is vitally concerned in
the transportation problem. He makes the arrangement for transport, selects
his trucker where there is any alternative, pays him for his service and has
daily contact with the distributor through the truck driver. At the annual
meeting of the Ontario Whole Milk Producers' League held in Toronto on
the 19th and 20th of February, 1947, the following resolution was adopted:
"WHEREAS under the Public Commercial Vehicles Act it is virtually
impossible for producers to transport their milk from their farms to the
dairies co-operatively.
"THEREFORE BE IT RESOLVED that we ask the Ontario Provincial
Government to amend the Public Commercial ^'ehicles Act making it
possible where any group of producers decide that it is in their best
interest to transport their milk co-operatively without obtaining a P.C.V.
license."
On this point a considerable volume of evidence by responsible officers
of the Ontario Whole Milk Producers' League indicated that body is of the
opinion that, in the case of organized markets, any group of producers
proposing to truck co-operatively should have to establish their case for the
new service before the Milk Control Board, but that in unorganized markets,
which represent the bulk of the province, the right of producers to truck
co-operatively should become virtually absolute instead of being non-existent
as at present. A further resolution was adopted at this annual meeting
as follows:
"WHEREAS the cost of transporting milk from the farm to the market is
a factor that must be taken into consideration in milk costs to the
producer ;
"AND WHEREAS the volume of milk carried and the mileage travelled
has an important bearing on the cost of transportation;
"AND WHEREAS the milk is the property of the producer until it arrives
at the designated market and accepted bv the distributor:
"THEREFORE BE IT RESOLVED that the Ontario Whole Milk Pro-
ducers' League request the Royal Commission now inquiring into the cost
of producing, processing, distributing, transporting and marketing of
milk, taking into consideration the savings that could be effected by local
producer associations transporting all the milk from the farm to the plant
of the distributor, the number of trucks that could be eliminated, the
saving of miles travelled and the overlapping of trucks, to recommend
amending the Milk Control Act, vesting the Milk Control Board with
authoritv to license all truckers of milk from the farm of the producer to
the distributing plant, and Avith authority to arbitrate and fix charges for
this service."
On this point the Producers' Association indicated that it was their opinion
that the mere granting of power to local producer associations to go into
the milk transporting business as such would, in itself, be a sufficient lever
to bring about what they considered much needed reforms in the trucking
business, with consequent substantial savings to the producer. The Pro-
ducers' Association seemed to assume that any such savings would auto-
matically accrue to the benefit of the producer and not to the consumer who,
of course, ultimately pays all costs.
(6) The Distributor
The distributor's chief interest in the transport problem lies in insuring
regularity of delivery according to the laid-down schedule, and in safe-
ONTARIO ROYAL COMMISSION ON MILK 77
guarding the quality of the milk as it arrives at the dairy. There are some
distributors, however, who have taken over on their own account the owner-
ship of the transports required to haul milk from the farms. The evidence
showed that one substantial dairy in the City of Windsor which was charg-
ing rates the equivalent of or slighth lower than those charged by other
transporters, was showing substantial profit in this department. On the
question of distributor-owned transports under the existing system where the
producer pays the initial cost of transport by deduction from the gross price
of milk, the Toronto Milk Transport Association has this to say:
"Toward the end of 193.3 and through 1934, many dairies seemed
determined to get into the transport field. In some cases, the distributors
did so in a legitimate manner with little disruption of service, purchasing
routes from the men then operating them. However, from a number of
instances, two important objections became apparent. The distributors
would by-pass the Producers' Association and seek to get cheaper milk
with promises of special deals to individual farmers; and secondly, when
starting into the trucking field, it was a practice of some dairies to throw
out shippers who had been shipping to them in order to take on new ones
grouped in an area comenient to their own trucks."
It is, of course, a fact that the Whole Milk Producers' Association is
stronger and better able to protect the legitimate interests of its members
than it was in 1933 and 1934. and. further, the Milk Control Act has come
into force since that time. There are. therefore, deterrants at the present
time to one of the evils referred to in the above quoted passage; in that the
possibility of acquiring cheaper milk bv promises of special deals to indi-
vidual farmers would be much more difficult to accomplish. It is significant,
however, that even under the present system where the producer bears the
initial cost of transport, that on the evidence of the Transport Association
distributors going into the hauling business tended at once to rationalize
and shorten transport hauls. The question immediately arises as to what
would be the situation if the distributor were required to pay the initial
cost of transport and hence had a financial interest in the distance travelled.
(7) The Consumer
The simple interest of the consumer in this problem should be mentioned,
because it is too easily overlooked. The fact of the matter is. that regardless
of who pays the initial cost involved in transporting milk from farm to
distributor, that cost ultimalelv comes out of the price paid by the consumer
for the processed product. It seems to me only fair, therefore, that the
consumer should pay not one fraction of a cent more for this essential food
than is required to cover the cost of reasonably efficient operation, and that
he should certainly not be called upon to pay for the perpetuation of any
system merely because a change would adverselv affect a so-called vested
interest. In my view this aspect of the situation is overlooked in the repre-
sentations made by the Whole Milk Producers' Association.
(8) Equipment and Methods
In the Province of Ontario, as already stated, the first haul of milk is
almost entirely done bv motor transport of various types and sizes. Trans-
ports range from small vehicles of a type that can be used for any general
haulage to very large vehicles refrigerated and capable of carrving loads in
excess of ten tons. In a few instances tank vehicles are used, but these are
rare. It has also been noted that the trucking rates vary in the Toronto
78 ONTARIO ROYAL COMMISSION ON MILK
market from 18 cents per oO-pound can up to 40 cents, depending upon the
distance from market. In New \ork State a rather different system is in
practice which is, no doubt, traceable to the enormous influence of the New
York City market for fluid milk. In that State the great bulk of milk is
transported by motor truck to local depots and then trans-shipped by rail
to New York City. Revised Official Order No. 126, which became eff^ective
October 1st, 1946, of the State of New York Department of Agriculture and
Markets, Division of Milk Control, regulates the handling of milk to be sold
in the New York Metropolitan milk marketing area. At page 19 of this
Order the transport rates for milk to be used for various purposes in the
New York Metropolitan market are set out. The producer who ships by
truck or rail for a distance of 191 to 210 miles from the City of New York
receives the full gross price per hundred pounds of milk. Producers who
ship from distances within this radius receive a premium over the gross
price which ranges up to 15 cents per hundred pounds for distances less
than ten miles. At distances of 500 miles from the New York Metropolitan
area a deduction of 14 cents is made from the gross price per hundred
pounds paid to the producer. From these figures it is evident that a shipper
into the New \ork City market is in a position to transport his milk by
freight for a distance of 500 miles at a cost of 29 cents per hundred pounds
or the equivalent of 24 cents per 80-pound can, whereas a shipper in the
Province of Ontario would pay 24 cents to transport an 80-pound can a
distance of 30 to 45 miles. It should further be noted that, although the
bulk of milk in New York State is transported by rail, the same rates apply
to motor transport.
The milk remains the property of the producer until it has been delivered
at the distributor's plant and accepted as meeting the minimum require-
ments for the purpose for which it is to be used. The can is then weighed
and samples taken to determine butter-fat content which, of course, deter-
mines the price to be paid to the producer. In some small dairies, no doubt,
the workman handling the milk knows whose can of milk he is handling at
the moment, but it is obvious that in anv sizeable dairy the employee who
does the mechanical work of weighing, inspecting and sampling a can of
milk has no knowledge or interest in the source of the milk and only sees
a code number on the can. This point is particularly mentioned since
evidence given by representatives of the Whole Milk Producers' Association
indicated that for some reason, which is not easv to understand, producers
seem to feel that it was to their advantage that the title to the milk should
not pass until such time as it had been accepted, weighed and sampled. In
my view there is no real ground to support this opinion.
( 9 I Summary
From the evidence before me 1 am satisfied that the present system of
hauling milk from producer to distributor is not designed to insure that
milk is not hauled anv greater distance than necessarv and the elimination
of duplication and waste. It seems to me that a chief cause of this situation
is the fact that the price of milk is determined as delivered at the distributor s
plant. There are, no doubt, many individual producers who are prepared to
receive a slightlv lower net return in order to ship milk a great distance
to a market such as Toronto, and while the cost of such lengthy shipment
when deducted from the individual producer's annual earnings may not be
a very large sum, when that cost is multiplied by many producers in the
same position it becomes a very substantial sum. all of which comes out of
the ultimate consumer's pocket. I believe that if the price paid for fluid
ONTARIO ROYAL COMMISSION ON MILK 79
milk were fixed net at the farm, and the distributor was compelled to maice
his own arrangements for transporting such milk, either by contract with
an individual trucker or by transport owned and operated by the distributor,
a number of important alterations would result, all to the ultimate benefit
of the consumer. In the first place, as is indicated by the passage quoted
from the sulimissions of the Toronto Milk Transport Association, the dis-
tributor searching for his milk at a low cost would immediately make an
effort to find a source of supply at the closest possible distance from his
plant. This, it seems to me. is an obviously proper adjustment since the
present system, which results in the most widespread milk sheds, is directly
in the face of all economic principles. In the second place, particularly in
urban markets of which the Toronto milk market is probably the best
example, if substantial distributors were to take over the task of transporting
milk, the amount of capital which such distributors could devote to this
phase of the operation would undoubtedly result in more efficient equipment
being placed on this work than is possible by a small individual trucker
operating a single truck. The figures quoted, showing the maintenance of
profit by transporters in the Toronto milk market area in the face of greatly
increased costs, illustrate the point that maximum loads operated on con-
centrated routes produces a minimum cost per unit transported.
There is no doubt in my mind that payment for milk at a price determined
at the farm and not at the dairy will result in some shippers in outlying
areas losing their present markets, but I am convinced that after a period
of adjustment the product of such shippers will reach the market which
it is economically desirable that it should reach. Without minimizing
the importance of the human relations between producer and the individuals
with whom he is at present dealing, it is asking too much of the consumer
to pay continuous tribute to the maintenance of these relations.
There is a further point to be considered, and that is that, with the
exception of three organized markets, the rates charged for trucking are a
matter of negotiation between individual producer and trucker. In view
of the fact that the producer must get his milk to market, the relative
bargaining position is poor. At the present time, if a producer is dis-
satisfied with his trucking service, he may be faced with the greatest
difficulty in securing an alternative service. If he fails to do so his main
product may never reach the market, with disastrous results to the in-
dividual ])roducer. The question of weighing and sampling the milk,
which no doubt is a serious matter, does not, however, I think, present a
real obstacle to the change which I feel should be made. It surely is not
beyond human ingenuity to provide a workable scheme. In the great
majority of markets the actual mechanics of handling each individual
can of milk would be substantially the same. However, some method
of testing the milk for flavour, and freshness at the time it is picked
up at the farm, would no doubt have to be provided. This does not
seem to be a difficult problem. It should also be possible to take samples
at the same time for butter-fat test. The principle problem is that of
weight, but since the farmer is largely dependent on the integrity of
his distributor, whether means of measuring the quantity by weight or
otherwise at time of pick-up are developed or not, does not put the pro-
ducer in any worse position than he now is. The question of check-
testing, etc., is dealt with elsewhere in this report, and the views I have
expressed there with respect to the protection of the producer and dis-
tributor alike apply with equal force whether the milk changes ownership
at the farm or at the distributing plant.
80 ONTARIO ROYAL COMMISSION ON MILK
It may be argued that, in view of the opposition to the change outlined
above from both producers and transporters, some aUernative method
of protecting the consumer should be sought. It may be suggested that
the whole question of routes and equipment should be reviewed bv some
competent authority, for example the Milk Control Board, and rationalization
enforced. I am of the opinion, however, that this is impractical. The
amount of pressure to which any administrative board would be subjected
when it proposed to cut off shippers from a market to which thev ma\
have been shipping for 20 years or more, can readily be imagined, and
at the best I am satisfied a very imperfect result would be achieved and
one which would be full of compromises. The alternative of permitting
wide opportunity to producer associations to handle their own transporting
co-operatively or otherwise, is not a sufficient solution, because it over-
looks the fundamental fact that the cost of transporting, regardless of
how it is done, is paid by the consumer, and the methods presently em-
ployed, even if this were allowed, are too wasteful. It is possible that
if the Ontario Whole Milk Producers' Association as a whole took over
the co-operative transportation of milk, duplication of service would as a
natural consequence be largely eliminated. I am sure, however, that milk
would continue to be hauled from substantially the same farms as at
present, for greater distances than are justified, and in any event it is
difficult to visualize such a comprehensive co-operative transporting scheme
being introduced into this province. Anything less than such a scheme
would, in my opinion, merely add another competitive trucker and further
duplication of service with its attendant waste and unnecessary expense.
The foregoing is not intended to derogate from a recommendation which
will be made in the final chapter of this report, namely, that as an immediate
step producers be given the right to associate themselves co-operatively for
the transportating of their own and their neighbours' fluid milk withouf
P.C.V. license. This is, admittedly, a palliative and does not solve the
major problem raised in the transporting of milk.
I feel, therefore, that steps should be taken to allow normal economic
principles to govern this aspect of the industry, i.e., the distributor who
supplies the consumer should be required to find his raw product at such
place as provides him with the least expensive source of supply. It may
be argued that the fixation of price of raw product at the farm instead
of at the distributor's plant, while it should quickly bring about the
elimination of unnecessary long hauls, would not in itself eliminate dupli-
cation of service on roads. This may be very true, especially under circum-
stances where distributors are pressed to secure adequate continuous supplies
of suitable raw milk. However, that is a matter ^\hich the controlling
authority must deal with, and from an administrative point of view it
would appear to me that the distributor is much more amenable to regulation
with regard to transport service than either producers or independent
truckers paid by the producers.
In view of the conclusions I have reached on this aspect of the problem.
I have not thought it necessary to go into a detailed examination of the
cost and profit position of transporters under the existing system. Some
study has been made of this aspect by the Commission Accountant, and
his report, as stated above, appears as Appendix 17. I only wish to
comrnent on the estimate of return as related to capital employed. From
the figures available to Mr. Entwistle, it would appear that the return
on capital employed in the transporting of milk may be in excess of 20
per cent. This is a difficult fipjure to determine because of the absence
ONTARIO ROYAL COMMISSION ON MILK 81
of replacement vehicles during war ) ears. There may be some question
as to the true value of "capital employed", but if the estimate is correct
such a return appears to me to be a very generous one and not in keeping
with the necessity of holding consumer prices of milk at the lowest possible
level. The matter is discussed in some detail in Mr. Entwistle's report. I
should also direct attention to Mr. Entwistle's comment on the relatively
high percentage of administrative and office salaries to total revenue, as
compared with other divisions of the milk industry.
In reaching the conclusions stated, I am not unmindful of the fact
that the milk truckers by and large have honestly built up their businesses
and have provided vital services to the industry. It may be that they
should be given an opportunity to themselves rationalize their methods
of delivery before the somewhat drastic changes suggested are undertaken.
But irrespective of the methods used, the consuming public should no
longer be asked to bear the cost of such an inefficient system in the
price to them of a vital food product.
82 ONTARIO ROYAL COMMISSION ON MILK
CHAPTER VII
Distribution and the Position
of the Distributor
The cost and profit position of the milk distributors as a group was the
subject of a most exhaustive enquiry and study by the Accountant furnished
me for the work of the Commission. The results of this work, done under the
direction and supervision of Mr. John Entwistle, C.P.A., is sufficiently
valuable in detail to be set out in full, and I have included it as Appendix 18
of this report. It was not work that was accomplished easily, and indeed it
was not completed until early in July of this year, when the final definite
draft of this report was made available to me. Fortunately, earlier and more
tentative drafts were available by early June.
For the most part the accounting report speaks for itself. It is used here
by way of commentary on the general conditions and tendencies disclosed,
and in order to compare the results obtained with the other evidence pre-
sented during the public enquiry. Where possible, I have endeavoured to
correlate the two and to value the report accordingly.
The distributors are. of course, all licensed by the Milk Control Board,
and in this particular part of the report I am dealing with them for the most
part in their capacity as distributors of fluid milk only. As will be seen,
they comprise all sorts of operations both large and small, and the regula-
tions governing them are such that they must be all-inclusive and must apply
to all kinds of business. This is also true of the price-fixing agreements
which have been entered into between the producers and distributors.
These agreements are necessarilv governed by the needs of the small operators
as well as the larger. In the result this has been to the advantage of the
larger operators who have large volume of sales and in many cases handle
a variety of dairy products.
Licensing
The Milk Control Act provides that no person shall directly or indirectly
engage in or carry on the business of supplying or distributing, transporting,
processing or selling milk, unless such person is the holder of a license
issued by the Board. The distributors of milk licensed by the Board are
divided into three classes, regular distributors, producer distributors and
pedlars. Pedlars are a class who habituallv obtain their milk from the pro-
ducer, or more generallv from a licensed distributor, and sell it on a route
of their own; they do not process the milk and are few in number, and very
little consideration need be given them in describing these distributors, as
they have little or no effect on general conditions.
In the year 1945 there were 76 licensed pedlars, and in the vear 1046 the
number was 83. In the year 1943, 624 regular distributors were licensed,
and 389 producer-distributors. In the vear 1946. the regular distributors
numbered 630, and the producer-distributors 346. The Milk Control Board
was first set up in the vear 1934. and for the years 1934 and 1935. in their
records, the type of licenses granted were not differentiated. The total
number of licenses issued in 1934 to regular distributors, producer-distribu-
tors, pedlars, and milk manufacturers, was 1,335. The same figure for
ONTARIO ROYAL COMMISSION ON MILK 83
1935 was 1,624. For the year 1936, when the classes I have indicated were
established, 647 licenses were issued to regular distributors, 861 licenses
were issued to producer-distributors, and there were 87 pedlars; making
a total of 1,595.
It is obvious that there has been, over the ten year period from 1936 to
1946, a somewhat drastic decline in the number of producer-distributors.
This, I think has been a natural result of the general improvement in
economic conditions, which made it possible for many of these producer-
distributors to confine their attention to production or, in some cases, to
secure more remunerative employment elsewhere. This was particularly true
as the war progressed. As suggested, there has been a tendency for the
producer-distributor to revert to the position of producer and to leave the
distribution of fluid milk to the regular distributors who, generally speaking,
also engage in the distribution of other dairy products.
Position of Distributor in the Industry
The regular distributors are the persons, partnerships and corporations
engaged in the processing and distribution of fluid milk at both retail and
wholesale.
Apart from the wholesale aspect of the business and the distribution of
fluid milk through retail stores, the distributor, in most cases, stands
directly between the consumer and the producer, and unless the trucker of
milk from the producer to the distributor can be called a middle-man, no
other middle-man intervenes.
The average distributor confines himself to the distribution of fluid milk,
chocolate milk, butter-milk and fluid cream. Precise figures are not obtain-
able, but out of the total of 630 distributors licensed in 1946, the number en-
gaging in the sale of creamery butter, ice-cream, and concentrated milk prod-
ucts, does not, I am advised, greatly exceed a hundred. Disregarding the
branch operations of the three largest distributors, of which mention will be
made below, and of some 35 operators who are more properlv classified as
creameries, the number is 55. For the fiscal year preceding October 1st, 1946,
the total value of all dairy products handled by these 55 distributors amounted
to $16,114,722. as against a total sales value for all distributors of approxi-
matelv $90,000,000. being 18 per cent of the total sales. This amount of
business was done by 55 distributors against a total of about 630.
The three largest distributors in the province who also engage in this
blended operation in the same period sold products to the value of $35,-
472.455. making a total, if they are included, of $51,587,177 for the 58
distributors so diversifying their business. The percentage of dollars for
over-all sales by the three largest distributors is 39 per cent of the total
dollar value of sales for the province. When the 58 distributors are con-
sidered the percentage figure is 57 per cent. It thus appears that on a
dollar basis those distributors dealing substantially in fluid milk alone con-
stitute only 43 per cent of the total intake from sales, although in number
they probably constitute about 572. These figures are given without regard to
the producer-distributors who, for the most part, deal only in fluid milk.
When profits are looked at, the results may be expressed as follows:
Profits of all regular distributors $3,294,000
Profits of 55 distributors 533,397
beins; 16 per cent of total
Profits of 3 largest distributors 1.593,263
being 48 per cent of total
34 ONTARIO ROYAL COMMISSION ON MILK
Total Profits of 58 distributors 2,126,660
being 64 per cent of total
Total Profits of balance of regular distributors is 1,167,340
representing only 36 per cent of the total.
The importance of these figures and percentages will be apparent when
the question of price-fixing at the consumer level is discussed. They also
illustrate one of the essential requirements of the industry if a profitable
operation is to result.
The producer-distributor, on the other hand, generally does limit his
operation, and he, of course, fills a very definite need in smaller communities
of the province.
The average regular distributor sells his milk, not only at retail and
wholesale, but also, in many cases, sells it at wholesale to grocery stores
who, in turn, sell milk to the public as one of their regular items in the
course of their business.
Since December, when this inquiry actively commenced, the accountants
attached to the Commission have f)een endeavouring to examine the financial
position of the distributors, and attention was paid in this examination and
investigation to the provisions of Paragraph A of the Order-in-Council, set-
ting up this inquiry, that is, to the distributing and marketing of milk, and to
the costs, prices, price-spreads, trade practices, methods of financing, man-
agement and grading of those distributing fluid milk.
While there appeared to be, in the year 1946, 984 licenses issued to
distributors, our examination disclosed that, in many cases, licenses were
issued to various branches and units of the same enterprises, and it may be
said for practical purposes, that there are approximately 850 distributors
distributing fluid milk to consumers in the Province of Ontario.
The Regular Distributors
Apart from the producer-distributors among the regular distributors,
there is the greatest variation in the size and type of business carried on.
There are distributors doing business with an annual sales volume as small
as S5,000 a vear: and at the other end of the scale, among the so-called
independents, that is apart from the three largest operators, of whom I
^, ill speak later, are firms doing a business in excess of $1,000,000 a year.
The Borden Company Limited, which is one of the three large distributors,
does the largest business in the province and has an annual sales volume
in excess of $13,000,000 a year. Some of these distributors are proprietory
concerns owned by an individual, some are partnerships, and many are
limited companies. I have indicated above the approximate number who deal
only in fluid milk and cream, and even in those cases, I am told, they
frequently act as jobbers in the sale of butter and eggs, which they carry as
a convenience for their customers. In the year 1945, of necessity the year
into the operation of which investigation had to be made, a total of some
432.857,500 quarts of fluid milk were sold in the Province of Ontario,
representing a dollar value of $53,284,758.00. In the year 1946 the quantity
of fluid milk sold was 467,736,000 quarts, representing a dollar value of
$60,488,860. These figures include the consumer subsidy of two cents
paid until May 31st, 1946. As the price increased at that time by the extent
of the subsidy, they are comparable. Similar figures for the sale of fluid
cream, ice-cream, ice-cream mix, chocolate drink, butter, cheese and other
products, including eggs, poultry and sausages, are set out in table 14 in
Mr. Entwistle's report. Appendix 18.
ONTARIO ROYAL COMMISSION ON MILK 85
Developments in Respect of Pricing
Without commenting at this point on the powers of the Milk Control
Board to fix prices, the Board, until October, 1946, had from the year 1985
proceeded on the premise that it possessed such a power. As a result the
distributors have operated in these years since the establishment of ^the
Board in markets in which prices have been fixed either by order of the Milk
(control Board or by agreements with producers, having for the most part
Board approval. This result was attained gradually since 1935. The record
furnished me by the Milk Control Board is set out in Appendix Number 6. A
study of this appendix will show in a general way that during the years 1935
to 1937 there was considerable activity in establishing a price structure across
the Province. This stabilized towards the end of 1937 and from then until
1939 there was not much change, but in the years 1941 and 1942 there was
again pressure towards high prices across the entire province. As has been
remarked before, in 1934 when the Milk Control Act came into operation
there was a chaotic and confused situation in the milk markets of the
province and a study of the minutes of the early meetings of the Board
shows that at that time it was acting generallv in the capacity of an investiga-
tor and was attempting by pressure on producers and distributors to obtain
a more rational organization of the various markets and price agreements.
By 1935, however, when the Act was amended, a number of orders were
issued setting prices for the first time. This process went on through the
years 1936 and 1937. By 1937 there was a movement towards higher
prices in a limited degree and increases amounting to one cent per quart
retail price were given in Northern Ontario cities of North Bay. Sault Ste.
Marie, Sudbury and a number of smaller points in Southern Ontario. In
the Toronto market the price moved up one-half cent a quart and in that
summer moved back to the former price of twelve cents and later rose to
thirteen cents.
The basis of these price arrangements in the early years of control was
what has been called "the recognized price." As far as one can judge from
information furnished me this was the price prevailing in the late 1920's
before the break owing to the depression of the early 1930's. An example
of this can be shown in the following table relative to the Toronto market:
Year Retail Price Per Quart Producer Price Per 100
1929 May $ .1250 " $2.36
September .1333 2.66
November .14 2.81
1930 June .1250 2.20
October .13 2.50
December .12 2.20
1931 May .11 1.85
1932 February .10 1.45
1933 August .11 1.81
1935 October .12 2.10 (By
Agreement, approved
by Board Order).
The recognized price for Toronto at the time of the negotiations in 1934
and 1935 appears to have been 11 cents per quart. Evidently this recognized
price was not satisfactory to producers and the price, reached by agreement,
became 12 cents per quart to consumers and S2.10 per 100 pounds to
producers.
86 ONTARIO ROYAL COMMISSION ON MILK
In the years 1938 to 1939 price stability seems to have been achieved for
a short period, although the Toronto markets again reverted to twelve cents
and price agreements were reached in a few other markets.
By 1940 a few markets moved upwards by one cent a quart, the only one
of any consequence being the City of Ottawa. By 1941 the inflationary
pressures which resulted towards the end of that year in the imposition of
price control became more apparent. An examination of Appendix 6 shows
that there was a substantial upward revision in the year of one cent per
quart. It is stated that many markets applied for a second increase in that
year, but that the Milk Control Board was unable to obtain the concurrence
of the Wartime Prices and Trade Board. At this time the eff"ect of the
rapidly rising increase in production costs began to show in fluid milk
shortages, and at the end of 1941 producer subsidies were paid by the
Federal Government as a wartime measure for the first time. I am also
advised that by the end of 1941 practically every milk market, with the
exception of very small towns and villages, was operating under prices
established by the Milk Control Board administration.
What followed from this point can best be put in the words of a memor-
andum furnished me by the Chairman of the Milk Control Board:
"In 1942 the Wartime Prices and Trade Board established price ceilings
on milk to consumers —
Southern Ontario, 12 cents
Northern Ontario, 13 cents
Principal Markets, Toronto, Hamilton and Niagara Peninsula and
Windsor at existing prices of 13, 121/2, and 13 cents respectively.
A number of markets in Ontario were selling milk to the consumer at
prices lower than the established ceiling prices. A number of these
markets were located in close proximity to other markets at the ceiling
price and, with the increased demand for milk and shortages in some
markets, it was evident we would be required to level prices out and con-
siderable of this was done in 1942.
"A further difiicult situation faced the Board as a result of the W.P.T.B.
subsidy payment ruling. Under this ruling the subsidy was payable only
in markets which were already selling to consumers at the ceiling prices.
This resulted in inequalities to producers and accentuated the demand for
increases in consumer and producer prices. These circumstances brought
a further levelling of prices and by the end of 1942 most of the towns and
smaller cities were at the 12 cent ceiling price.
"It will be noted that the producer prices moved upward in 1942. This
resulted from an Order, 42-84, of the Milk Control Board, following a
ruling from the W.P.T.B.. that producer subsidies were payable only on
certain minimum prices being paid to producers. Therefore, from Septem-
ber 1. 1942. there was a fairlv uniform price structure to producers,
that is. in all markets selling at —
12 cents per quart to consumers — the minimum price to pro-
ducers was $2.35
121'2 cents per quart to consumers — the minimum price to pro-
ducers was $2.50
13 cents per quart to consumers — the minimum price to pro-
ducers was $2.65
(Exceptions — Toronto Consumer Price 13 cents — producer price
$2.50
— Windsor Consumer Price 13 cents — producer price $2.55).
ONTARIO ROYAL COMMISSION ON MILK ii i
1943-1946
"The price structure as established in 1942 carried through until Septem-
ber 30, 1946. A few scattered markets, which were not at the ceiling
price of 12 cents for Southern Ontario, moved up to the ceiling.
Area Prices
"The first move took place in Kent County and in the Niagara Peninsula
in 1936. The move in the Niagara Peninsula was not completed until
1941, when Hamilton and the Niagara Peninsula were placed on a 12^/0
cent consumer price and a S2.35 producer price. In Eastern Ontario the
same price structure became effective in most of the markets in 1941 or
subsequently, except the Towns of Picton. Napanee, Morrisburg, Arnprior
and Hawkesbury, so that bv 1945 area prices were pretty well established
as follows:
13 cents — Toronto. Windsor and Northern Ontario
121/2 cents — Hamilton and Niagara Peninsula
12 cents — The remainder of the Province, with exceptions as above.
JJnifoim Prices
"It will be noted in the earl\ days that a consumer price was accom-
panied by varying producer prices, for example, a 12 cent consumer
price was accompanied by a producer price of S2.10 or S2.1.5 per
hundred. The Board, in trying to bring about uniform prices according
to consumer prices, decided that the distributor margin should be narrowed
and in 1941 a 12 cent consumer price carried with it a S2.25 minimum
producer price. Later in 1942 b; Board Order 42-84, a 12 cent con-
sumer price carried a S2.3.5 minimum producer price and a 13 cent
consumer price became associated with a l'^2.65 minimum producer price
instead of a S2.45 or $2.50 producer price."
The price structure as it exists at the present time is shown on the map
whch has been supplied through the courtesy of the Milk Control Board
and it appears following page 106.
Competition in Industry
Very little competition exists between distributors. As a result of the
growing stringency of health regulations, including pasteurization and the
price fixing agreements in all but the smallest markets of the province, the
only way in which distributors can compete is in respect of service to con-
sumers. For all practical purposes the product is standardized, which
eliminates competition on a quality basis. Price is fixed and trade practices
are uniform. There may be some variation in butter-fat content between
distributors, but there is a fixed and ample minimum in this regard. And
indeed, if attention is paid to nutritional evidence, this is no longer of great
importance from a health viewpoint. The competition remaining is obviously
of the most expensive and least necessary nature.
Distributor's Spread in Fluid Milk Sales
As is apparent, the price of fluid milk when consumed as such, is fixed
under various price agreements, which up to September 1946 were deemed
to have the force of law under the orders of the Milk Control Board. The
spread enjoyed by the distributor is measured by the difference between the
price he pays the producer and the price he gets for his milk when sold either
at wholesale or retail.
88
ONTARIO ROVAL COMMISSION ON MILK
The last order of the Milk Control Board fixmg prices in the Toronto
area, for example, is Order No. 42-2. The price schedule set out in it is as
follows :
Re: Sale of Milk by Distributors
That milk and milk products shall be sold by distributors at the following
prices only:
RETAIL
Customers
By In
Stores Glass
in or
Paper Paper
Con- Con-
STORES
Customers
Add 5c
Deposit
In per
Paper Glass
Con- Con-
WHOLESALE
Customers
Add 5c
Deposit
In per
Paper Glass
Con- Con-
3-CAN
Customers
Add 5c
Deposit
In per
Paper Glass
Con- Con-
tainers tainers tainers tainer tainers tainer tainers tamer
(Mc added) (He added)
STANDARD MILK
gal
qt 13H .13 .12 .IIH
pt 07H .07 .061.^ .05M
Hpt 04H .04 .03% -OSH
CHOCOLATE DRINK
g^t
ql 14H .14 .13 .12H
;^ pt 05H .05 .04 .03H
SPECIAL MILK
gal
qt 15 .141^ .14 .I3H
pt 08H .08 .07H 07
Hpt 05H .05 .04K .03%
IRRADIATED AND HOMOGENIZED
qt 15H .15
pt OBH 08
Mpt 05H .05
VITAMIN D
qt 14H .14 .13 .123^
pt 08K .08 .07 .06H
SKIMMED MILK (not over 1% B.F.)
gal
qt 08H .08 .07 .06^
BUTTERMILK (not over 1^ B.F.)
gal
qt 08H .08 .07 .06^
Hpt 04 .03H
SPECIAL BUTTERMILK
qt lOH 10 .09 .08H
pt 06H .06 .05H 05
Hpt 04 .03H
(He added)
(Hcad.ded)
.44
.11
.06M
.03%
.52
.13
.04
.52
.13
.07H
.04Ji
.13
.07H
.04%
.13
.07
.22
.05H
.22
.05H
.04
.07H
.05H
.04
.42
.lOH
.05%
.03%
.50
.12H
.03U
.50
.12H
.07
.03%
.12H
.07
.0414
12H
.06H
.20
.05
.20
.05
.03H
.07
.05
.03H
10
12
12
.38
.09H
.46
.iiH
.46
.IIH
.063
.20
,20
.06
ONTARIO ROYAL COMMISSION ON MILK
89
RETAIL
Customers
By In
Stores Glass
in or
Paper Paper
Con- Con-
STORES
Customers
Add 5c
Deposit
In per
Paper Glass
Con- Con-
WHOLESALE
Customers
Add 5c
Deposit
In per
Paper Glass
Con- Con-
3-CAN
Customers
Add 5c
Deposit
In per
Paper Glass
Con- Con-
tainers tainers tainers tainer tainers tainer tainers tainer
(1^0 added.) (3^c added) (J^c added) (i^c added)
32% CREAM
gal $2.10 $2.08 ....$1.96
qt 52^ .52 A9H 49
pt 35J^ .35
Hpt 25H .25 .213^ .21
10% CREAM
gal $1.06 $1.04 96
qt 26^ .26 .24^ .24
J^pt lOK 10 .09 .OSH
HOSPITAL MILK— 34c per gallon and 8?4c per quart in 5c deposit bottles.
9c per quart in paper containers.
SCHOOL MILK— .03c per half-pint.
SCHOOL. CHOCOLATE MILK— .03c per half-pint.
PEDDLERS — The independent drivers or peddlers be billed for all dairy products
with the exception of butter at the retail price in accordance with the Toronto
Milk Marketing Agreement in effect at the time and that they be given a discount
of 33H% with no further discount for cash or rebate of any kind given from this
price. Where no retail price is specified for "cream" the 3-can price without any
discount will apply.
RELIEF MILK — Where a voucher system is in effect and handled directly by the
municipality a discount of 10% may be given, but where Relief Milk is on a cash
basis, the prices contained in this agreement are in effect.
In September 1946. when the current price agreements were reached
between the producers and distributors, it was agreed that when the prevailing
price increase went into effect there should be added to the price set forth
under Order 42-2, three cents for quarts, two cents for pints and one cent
for half-])ints, and that these additions should govern the present price
structure in the Toronto market.
It is quite obvious that the return to the distributor is directly governed
by the extent of his wholesale and retail sales. The determination of this
has been a matter of the greatest difficulty. While returns in respect of
these are made to the Statistics Branch of the Department of Agriculture,
I found that they had not been compiled. Fortunately it has been possible
to tabulate a sufficient sample of the 1946 return to give a reasonable indica-
tion of the division between wholesale and retail sales in the province. This
result would indicate: (See Appendix 19)
Retail or Household Sales 73.93%
Wholesale and Store Sales 26.07%
The records for other years have not been dealt with. Owing to the variety
of accounting methods followed by the distributors it is, practically speaking,
impossible to establish any ratio from their accounts.
90 ONTARIO ROYAL COMMISSION ON MILK
Mr. Entwistle's opinion, prior to the recent price increase, put the average
spread between the producer price and the price obtained from the consum-
ers at 5.31 cents. As is pointed out in table 10 of his report, this is for the
fiscal year next preceding October 1. 1946. and it is interesting to note that,
under the recent price increase, the entire benefit of which did not go to
the producers, there is an increase in the spread of at least .36840 cents per
quart to the distributor, or for practical purposes .37 of one cent per quart.
There is a possibility it is slightly larger than this. This figure, however,
can be substantiated in his opinion. This brings the total spread under
which the distributor operates at the present time to 5.68 cents per quart.
It is interesting to note that the difficulties arising from the great variation
in accounting practice maintained by the distributors, which Mr. Entwistle
encountered, is not a new experience. In the preliminary report made from
investigations in the year 1922 by Mr. J. B. Hoodless and Mr. H. W. Clarke,
at that time with the Department of Agricultural Economics at the Ontario
Agricultural College, it was said:
"Difficulty was encountered owing to the various accounting systems
in use and in many cases costs had to be arbitrarily allotted to endeavour
to place them uniformly. The figures given are in all cases weighted
averages of two or more businesses."
These words could be applied with equal truth to conditions 25 years
later in 1947, and underline, if anything, the suggestions that have been
made from time to time in this report and which will be developed later, as
to the necessity of a more uniform system of accounting on the part of
distributors who deal in such a vital product to the public as fluid milk.
That this condition is not confined to the distributors in Ontario is evidenced
by the following words in the report of the Accountants attached to the
Royal Commission investigating milk markets in New Zealand in 1943:
"The books and records kept by these dairymen generally are inadequate,
and it would be of assistance in any future investigations if those engaged
would adopt a uniform method of bookkeeping."
Cost of Processing and Distributing a Quart of Milk
During the course of the inquiry various distributors attempted to Avork
out, insofar as they were concerned, the cost of processing and distributing
a quart of fluid milk. They, like the Accountants advising the Commission,
had to arbitrarily allot costs to the fluid milk distribution end of their
business. This was particularly true in the case of those distributors who
sold other and more profitable lines of dairy products than fluid milk. In
an industry composed of as many small units as is found in the distribution
of fluid milk in the province, there is great variation in profits resulting
after costs have been covered.
Taking the province as a whole, attention may be directed to table 10 in
Mr. Entwistle's study in Appendix 18 where, for the whole province, a net
profit per quart is shown to the distributor of .21 or roughly one-fifth of a
cent. Attention should also be paid to the fact that, in Mr. Entwistle's opinion,
the recent price increase benefited the distributors by as much as .37 cents
per quart and that, therefore, the present profit of the distributor is increased,
subject to losses from lesser volume, to the vicinity of .58 cents per quart.
It must be remembered, of course, that this is an average figure taken over
the whole province.
Most of the distributors who gave evidence before me showed a profit
ONTARIO ROYAL COMMISSION ON MILK 91
closer to one-third than one-half cent per quart, although some were larger.
Taking the Toronto market again as an example, there was filed before me
a study of the average costs and profits of some 27 dairies in the Toronto
market which, it was said, distributed roughly one-half of the fluid milk in
the city. It appeared on cross-examination that these 27 dairies by no means
constituted the most efficient half of the distributors in Toronto. The
statement of their costs, as submitted to me, is as follows:
Sales 100.000%
Sundry Income — Bond Interest Received — Profit on Butter and
Egg Sales and Hauling Income .820
Merchandise Cost — Milk and Cream 54.995
Processing and Bottling Costs:
Wages 5.844
Expenses 6.198
Depreciation . 1.444
13.486
Delivery Costs:
Wages 17.147
Expenses 7.028
Depreciation .551
24.726
Administrative Costs:
Wages— Office, Management, Sales Manager 3.185
Expenses 2.681
Depreciation .038
5.904
Sales : 100.000
Sundry Income .820
100.820
Merchandise Cost 54.996
Processing and Bottling Costs 13.486
Delivery Costs 24.726
Administrative Cost 5.904
Total Cost 99.112
Net Profit ; 1.708
100.820
Income Tax Based on Corporation Tax Rates .893
Net Profit after Income Taxes 815
92 ONTARIO ROYAL COMMISSION ON MILK
I do not think I need set out the other efforts along this line which were
made in other parts of the country, notably in Windsor, Ottawa and Northern
Ontario areas. It is sufficient, I think, to say that in no case have distributors
kept their records in such a way as would enable them to state with complete
accuracy what the costs relating to the distribution of a quart of fluid milk
are. Under the present accounting practices of the distributors, these calcula-
tions necessarily involve an arbitrary allocation of costs to the fluid milk
part of the distributor's business. They also involve equally arbitrary allo-
cation of charges for depreciation and obsolescence. It is a problem about
which no one can speak dogmatically. It is always an arguable question
when one attempts to disintegrate a blended operation, to say how much
of the administration expenses and how much of the charges for depreciation
and obsolescence should be allotted to the sale of fluid milk. Nevertheless,
within certain limits one can speak with fair certainty and, in my opinion,
it has not been demonstrated, either by the Accountants carrying on investi-
gations for the Commission or by any distributors giving evidence before
me, or by the consumer or producer groups, that the profit on the sale of
a quart of milk exceeds one cent per quart. In my view it has been estab-
lished by the evidence that the profit per quart is a fraction of a cent. It is
probably closer to one-half cent than to any other fraction at the present
time.
Necessity of Decreasing Costs and Narroiving Spread
It may be that, because of the profit resulting from a blended operation,
and because of the strong position built up by large volume of business,
certain of the more substantial distributors, including the three larger
distributors and many of the more substantial independent distributors,
would presently sell their milk at prices less than those presently pre-
vailing. If the concept of a fixed price to consumers of fluid milk, which
has obtained under the Milk Control Board, is to be continued, then
obviously a price must be set which is sufficient to cover the cost within
reason of all licensed distributors. A very valuable incentive towards
further narrowing of the spread and further decreasing the cost of distribu-
tion is entirely removed from the industry when the consumer price is fixed.
If some effective competition as to price were allowed to operate in the
industry, I am satisfied that means would speedily be found by the more
efficient distributors to further reduce the cost of supplying fluid milk to the
consuming public. The fixed price has tended to maintain a status quo in
the industry which, it seems to me, is a very unhappy one from the consumer
viewpoint. One might assume that the bonus which results from the fixed
consumer price to the larger and more efficient distributor, might have led
them to try to increase their profits by making cost reductions. The evidence
before me, however, did not bear this out.
As appears in my review of the administration of the Milk Control Board,
suggestions have been made to cheapen the processing and distributing of
milk since 1934. No significant measures appear to have been taken until
the years 1941 and 1942, when certain improvements, reducing the cost,
were brought into effect by the industry itself under the combined pressure
of the Milk Control Board and the Wartime Prices and Trade Board. It is
true that practically all the distributors who appeared before me stated
that they continually tried to improve the efficiency of their operation and
that they were continually on the lookout for better and cheaper methods
of distributing their products. But, apart from these very general statements.
ONTARIO ROYAL COMMISSION ON MILK 93
it was almost impossible to obtain any concrete examples of what was
meant by this evidence apart from the changes already alluded to in 1941-
1942. It is obvious, I think, that there must be a sharper spur behind the
industry if it is to achieve more effective and cheaper methods of distributing
milk than those which exist at the present time. There seems to be an
assumption by the industry generally that cost plus a fair profit results in a
fair and reasonable price. I do not believe that any greater fallacy has
arisen in the conduct of private business. If the privately owned agencies
distributing milk are to justify their existence, they must continually seek
to work out methods of cheapening their processing and delivery costs and
of passing on a fair measure of the savings thus obtained to the consumer.
Indeed, if 1 am right in my assumption that cheap milk results in large
volume consumption of milk, it is most essential in the distributors' interest
that they should do this to a greater degree than they have in the past.
Methods of Decreasing Cost and Narrowing the Spread
It must be apparent to anyone who has followed the course of the inquiry
before me, that the general attitude of the distributors in respect to lessening
cost was that all that could be done was being done, and that if all was not
perfect in the best of all worlds, nevertheless all that could be reasonably
undertaken was being undertaken.
In fairness to the distributor I think it must be said that it is not possible
to reduce the cost of distribution further without much more active co-opera-
tion on the part of the consuming public. There is, I think, no substantial
evidence before me which would indicate that the cost of processing and
administration are unreasonable or can be greatly reduced.
In connection with the general question of spread-narrowing, it is common-
ly believed that distributive spreads should be distinctly narrower in the
smaller than in the larger markets. During the course of the investigation
it appeared to be a common belief that costs of administration and distribu-
tion should be lower in the smaller markets than in the larger. Such,
however, would not seem to be the case. The general purport of the evidence
I heard was to the effect that, while processing costs were lower in the larger
urban markets, costs of delivery were, on the whole, higher. In the smaller
markets this process seems to be reversed and, while delivery costs are on
the whole smaller, processing costs, owing to lesser volume, from the examples
which I examined, generally seem to be higher. This, of course, is a
general tendency and not an absolute rule. In the larger urban markets all
costs do tend to be somewhat higher if only because of the higher wage
rates prevailing. It is, of course, entirely probable that, with the passage
of time, new and more effective methods of processing will be discovered
and doubtless these will be used in the first instance by the more efficient
operators and finally by most of the industry. The key at the present time
to any immediate further economies must lie in some fundamental re-orga-
nization of the distributing process. Without such re-organization possible
savings would be comparatively minor in nature and amount. It is interesting
to note that, in the study made twenty-five years ago by Messrs. Hoodless
and Clarke, the same conclusion was reached. They stated:
"The most careful study of the conditions of city milk supply as outlined
above indicated that measures for such improvement of the business as will
give, on the one hand a lower price to the consumer and on the other
hand a more attractive price to the producer, do not consist in an attack
on, or a lowering of, the distributors net profit. This item in the cost of
94 ONTARIO ROYAL COMMISSION ON MILK
distribution is the smallest item. It now yields no more than a reasonable
remuneration on the property used in the service, and being the smallest
item in the distributing cost it offers less opportunity for tangible reduction
in the costs of distribution.
"To effect tangible reductions in these costs requires the closest co-opera-
tion between the three interests affected, the consumers, the producers and
the distributors. The consumers have considerable responsibility in that
their co-operation with the distributors is necessary to reduce the costs
due to demands for unreasonable service and to their loose regard of the
property of the distributors. The co-operation of the producers with
the distributors is necessary in the cutting down of costs due to unevenness
of volume and quality of supply of the raw product. The distributor,
in addition to the above divided responsibilities has responsibilities
inherent in his business which he alone can discharge, particularly those
associated with the most destructive phases of keen competition."
While in Mr. Entwistle's study the cost of bringing milk from the dairy
to the door of the consumer's residence is set at 2.65 cents out of the total
cost of 12.10 cents per quart, it must be remembered that this is an average
figure. Roughly speaking for a large part of the industry, I think it can
be said with some confidence that the cost of delivering milk from the dairy
to the consumer is closer to 25 per cent of the total price charged.
I was much impressed with a communication received during the course
of the inquiry from a gentleman who has spent his life in the distribution
of fluid milk and who at one time was the head of one of the largest
distributors in the Toronto market. I quote from his letter as follows:
"I am confident you will discover that the excessive cost of milk is
entirely in the duplication of deliveries. All milk delivered in Toronto has
to meet the regulations of the Health Department. Therefore, customers
are assured the same quality as they now receive.
"Our sixty-five wagons had to travel a long way to reach their zone
before making deliveries and then their customers were scattered over
many streets. Similar conditions existed with other dairies which re-
sembled a game of checkers moving about to supply different houses.
If our entire patronage was in one area, only a few wagons would have
been necessary.
"Here is my suggestion that would save at least three cents per quart.
"Have a central dairy plant where all the milk would be received and
bottled, load large trailer vans similar to the largest furniture moving
vans, these trailers to be delivered to different points or stations where
the deliveries will commence. Then a crew of three men would take
over and hitch on to the load and begin deliveries.
"Two trailers would be used for each station, one of these would be
loaded with empties and picked up for return to the dairy when the
loaded one arrives each day. This van would move up a street like a
motor car on an assembly line, one man on each side of the street and a
driver.
"With a big reduction in price the customer would be willing to
co-operate by taking delivery on the front door step. There would be no
calling back for collection. For a convenience, tickets could be obtained
from the corner stores same as postage stamps. The merchant would
welcome this because other sales would be made. A doorstep without
an empty bottle and ticket would indicate no milk was required, yet a
ONTARIO ROYAL COMMISSION ON MILK 95
customer could always secure the same milk at the store on the street, if
she missed the deliver) van.
"This system is similar to the garbage collection whereby a large truck
moves slowly up the street and picks up only the cans that are left in the
proper convenient place for the men to reach. If no can is left out, then
the housekeeper has to wait for the next pick up.
"People are easily educated to new systems especially when reductions
are obtainable. Take for instance the cafeteria, the line up for busses,
the specified hours for shopping, the ready car fare, etc., etc.
"Consider the saving of taxes, buildings, and equipment contained in
the many dairy plants throughout the city. All this could be absorbed
in a central plant. These suggestions, of course, apply only to a municipal
system."
It must, however, be remembered that, if any changes are to be made in the
distributing system, such as zoning, co-operative delivery by one or more
distributors, sales through depots, quantity discounts, etc.. such changes can
only be introduced by the distributors with the full co-operation of
consumers.
It is quite apparent, as previously observed, that the product itself is
almost a uniformly standard one. The consuming public, however, do not
appreciate this and many consumer witnesses before the investigation, when
asked if they would be willing to accept any milk offered for sale in their
particular market without freedom of choice, stated that they would not.
Such would inevitably be the result of a zoned delivery system which would
allot certain areas on some equitable basis to each of the distributors. It
can only be said that if the consumer is not w illing to co-operate in effecting
economies of this sort, he should be prepared to pay the extra costs involved
without complaining about them.
At the present time, as already observed, any competition which exists in
the industry is one of service, based on the sales ability and personality of
the milk salesmen. This is unquestionably a very expensive form of com-
petition. As I have said, if the consuming public demand it they must
expect to pay for it. It is a form of competition, however, in which it is
very hard to detect any social value or any economic value except to the
salesman himself. It is most desirable to have the consuming public realize
that substantially they are purchasing a standard product and there is little,
if any, real difference between the milk sold by" the various distributors.
Depot Deliveries
In 1937 it was stated in a treatise on the subject:
"A really radical reduction of distributive activities would result if
consumers should become willing to take delivery at a store rather than
at the doorstep. Such a move would involve nothing less than the
disappearance of milk distributors as a special class and at the moment
is unthinkable."
My observation would be that, insofar as the wishes of the consuming
public are concerned at the present time, it is still equally unthinkable.
It may be, of course, that there are very substantial objections to depot
deliveries as a universal policy. Under that system the consumers would,
in effect, be making their own milk deliveries, while the present methods
of processing and bottling would continue. The function of the dairy would
end when milk was delivered for sale to the store or milk depot. It would
96 ONTARIO ROYAL COMMISSION ON MILK
cut the present high cost of milk salesmen but the social dislocation and
unemployment resulting from such a process would create another social
cost which in the long run might well equal the saving. Moreover it must
be remembered that the individual consumer would incur some cost in
going to the depot or store. Such a method, while not universal, has been
used in some of the larger United States cities and this fact has frequently
been cited as evidence that the people are willing to adopt such a system if
it is provided for them. It is also said that as a practical measure many
consumers, especially mothers of large families, would be unable to obtain
milk in this way and for many persons it would constitute a real hardship.
It would undoubtedly require the institution of larger refrigeration units
both in stores and in the new depots which would have to be built, and it
would involve a complete loss on the present delivery equipment and the
expenditure of substantial sums of money by the distributors for the erection
of distributing depots.
It is almost impossible in advance to calculate the loss and gain of such
a system. It can only be said that no experimentation in Ontario along these
lines has been conducted by the distributors to any extent, and it may be
that some cautious investigation along these lines would repay the efforts.
In this connection it should be remembered that, while the figure of 26.07
per cent of wholesale sale as against the total volume is a provincial average,
it affects comparatively few of the distributors in number. As Mr. Entwistle
points out, at least one distributor is exclusively in the wholesale business,
and a representative cross-section of successful independent operators shows
an average of 44 per cent wholesale trade. It was argued before me for
the distributors that the loss of profit resulting from larger depot or store
sales at discounts below the retail price to consumers would necessarily
render it essential to charge more for house deliveries because of the reduc-
tion of retail sales to householders by the distributors, and that this practice
would be unfair to those householders unable to take advantage of depot
sales. It is noteworthy that those distributors now engaging in a substantial
wholesale business have not as yet found this step necessary and are able,
even with high percentages of such sales, to still show substantial profits.
From Mr. Entwistle's conclusions, the new price increase has made this
even more possible. In view of this it is difficult to resist the conclusion that
the ultimate consumer should now have some discount for depot or store
purchases or purchases in bulk. In effect, by this method some of the
advantages of the recent price increase would then be passed on to the
ultimate consumer.
Every Other Day Delivery
Delivery costs can also be reduced by adopting less frequent delivery,
such as every other day delivery, or five day or six day delivery. These
would unquestionably result in some saving on equipment and manpower,
and in many markets, notably in the United States, one or the other of these
methods have worked with a fair measure of success. Whether the greater
lack of household refrigeration in Ontario, as compared with parts of the
United States, would be a bar to such a system in Ontario cities, especially
in the summer months, is a practical question that should be considered.
The objections, apart from refrigeration, are all technical in nature. It is
said that the necessity of keeping milk for a longer time before using it
might have adverse effects on its quality and might lead to disease. New
costs would be created in that distributors would have to maintain a somewhat
ONTARIO ROYAL COMMISSION ON MILK 97
larger supply of bottles. The present transportation facilities for use on
alternate days would probably be sufiGcient.
Co-operative Delivery by Distributors
A third plan suggested would not change the essential nature of the work
to be done, but would eliminate duplication in the doing of it. This would
involve the creation of a distributing agency for the various dairies and
would result, if properly done, in a completely rationalized system of
delivery. Such an agency could either be municipally-owned and operated
or owned by the distributors co-operatively. In effect, this is one of the
results of the municipal dairy at Wellington, New Zealand. It has been
stated by some authorities that the savings from such a system might result
in one and one-half to two or one-quarter cents a quart, depending on the
size of the market. In effect, it would call for collective selling and delivery.
In respect of the benefits obtained from such a system it is worth noting
that in the majority report of the Royal Commission in New Zealand in the
year 1943, it was stated that the Wellington Municipal Milk Department
distributed milk in that municipality at least one penny per quart cheaper
than the other privately-owned companies whose cost of distribution were
investigated.
Zoning
Another plan which has been suggested would be that of zoning, which
I have mentioned earlier. This, of course, would completely eliminate over-
lapping in deliveries and competition in selling. The result would be
unquestionably a sizeable reduction in delivery mileage and delivery time
and therefore delivery expenses. The distributors on the whole objected
to such a suggestion when it was put to tliem on the ground that it did not
permit them to choose their own customers or their customers to choose
them. They also objected because the plan tended to eliminate the
opportunity of securing volume from new business. The plan was apparently
tried with success in Melbourne, Australia, in 1938 and has, I understand,
operated there since that time.
In respect of suggestions made to eliminate duplication of delivery, it
should be noted that the extent of this duplication varies very considerablv,
depending on the size of the market and also on the scale of operation of
the distributor. In many of the smaller markets where the number of
distributors is small and where distances are relatively short, the possibilities
of duplication are obviously much less than in large urban markets where
distributors are numerous. In such urban centres the smaller distributors
may have to travel considerable distances in delivering their loads. On the
other hand, the large scale operators in these centres have a much greater
density of delivery, which assists in reducing their costs. In other ^vords.
distance between calls in their case is much less than in that of the small
concerns.
Quantity Discounts
The general attitude of the distributor was to oppose quantity discounts
to householders. It was stated that householders would co-operate by buying
large quantities to obtain reduced prices, and the distributor regarded this
practice with disfavour. It was also stated that there were grave difficulties
in working out a workable system through the men distributing milk for
handling these reduced charges, and generally it was not treated seriously.
98 ONTARIO ROYAL COMMISSION ON MILK
I do not think, however, that any of the witnesses for the distributors wer^
able to deny that it was cheaper to handle a large quantity of milk to one
point than the same quantity to several different points, and in view of the
remarks at the conclusion pf the paragraph relating to depot sales, it would
seem to me that some discount for quantity purchases should be seriously
considered by the distributors. After all, in principle it is identical with
the giving of discounts for wholesale purchases, which is a regularly
established practice and already constitutes more than 25 per cent of the
total milk distribution in the province.
Trade Reaction
The reaction of both the distributors and the consumers to most of these
suggestions was a simple attitude that it could not be done. I do not believe
this attitude is a tenable one. I think in many cases more could be done,
but unquestionably some effective pressure from outside the industry is
necessary to bring it about. This pressure could be in the form of a more
aggressive policy on the part of the Milk Control Board, or preferably by
the creation of real and effective competition within the industry itself.
Unquestionably the existence of this high distribution cost and the apparent
economic waste incurred is one of the strongest grounds on which public
ownership and control of the distribution of fluid milk is urged. I propose
to discuss this problem later but it would appear that milk is such a vital
product that the public are entitled to obtain it in the cheapest possible
manner. It must be remembered, however, that a price is paid for all efforts
of this sort and it may well be that what is gained on one hand is lost
on the other.
It was stated in Chapter 2 of this report that there are approximately
20,000 persons engaged in processing and transporting milk and milk
products. A large proportion of this number is engaged in distributing milk
in small municipalities, and if as a result of economies they are to be deprived
of their occupations as such, the cost of this re-allocation and re-shifting of
a large group must be taken into account. It is entirely desirable that those
distributing milk should be well and adequately paid for the work they do,
and if they can be readily absorbed in other lines of endeavour there is
not the same objection to sudden and drastic changes in methods of distribu-
tion which would otherwise arise. Possibly the key to the problem from the
viewpoint of the distributor lies in the realization of the fact that essentially
he is operating a public utility. This fact involves him in an obligation to be
more adventurous in discovering methods of better serving the public at
cheaper prices. In my view, if some definite efforts along these lines are
not instituted and not pressed with more vigour than in the past, the logical
alternative will be the setting up of publicly-owned utilities to carry on the
functions now performed by the present distributors; and public opinion
may well force this whether the results justifv the change or not.
The Financial Position of the Distributors Generally
The general financial condition of the distributors, on an over-all basis,
is fully discussed in Mr. Entwistle's report in Appendix 18, and I see no
great advantage in repeating what he has said. Nevertheless, there are
certain conclusions that he has reached that are worthy of comment. It
is worthy of note that, as compared with 1944, the proportion of milk used
for fluid consumption, as compared with total production, has increased from
about 26 per cent to an estimated } ; rcentage of 27.67 per cent. If one
ONTARIO ROYAL COMMISSION ON MILK 99
relates this to the discussion earlier in this report dealing with the producer's
surplus milk problem, it will be seen that the process there indicated has
taken place. The tendency for new producers to enter the fluid milk field
because of better prices obtaining, has not yet exhausted itself.
Looking at the over-all examination based on the financial statements of
a substantial number of independent distributors, which is set out in Exhibit
B to Mr. Entwistle's report in Appendix 18, it is interesting to note that
on an average the total percentage of profit as against sales amounts to onl)
3.02 per cent and that the percentage of profit against capital employed is
17.57 per cent before taxes. When a closer examination was made by means
of questionnaires, it was noted that the profit percentage of sales is lower
in the larger markets and the higher percentages are shown in Eastern
Ontario, Northern Ontario and the Niagara Peninsula.
This, of course, is without reference to the earnings of the three large
distributors, which in one sense dominate the industry in Ontario. As Mr.
Entwistle points out, if their earnings were taken into account the per-
centages would be higher. The point which I wish to develop shortly is that
in the distribution end of the dairv industry one of the necessary conditions
to the creation of high profit is large \olume distribution. It is worth
noting that the percentage as against sales of the combined average of the
three larger concerns is 4.49 per cent. These reflect profit not only on the
distribution of fluid milk but on what I have called the combined operation
on the distribution of all products handled. The fact that their net profits
when considered as a percentage of sales are almost 50 per cent higher
than the others, also indicate another condition of the business, that is that
if large profits are to be made other lines such as ice-cream and chocolate
drink should be handled. The three larger distributors are so organized.
Not all the independent distributors are.
Capital Employed
The question of what capital is employed is one which is fundamental in
relating profits to the capital structure and considerable di\ergence oi
opinion was expressed before me as to what constitutes this.
Mr. Entwistle. in his study, in dealing with the independent concerns,
used the methods indicated by the Dominion Income and Excess Profits Tax
Acts. When these were applied to the three larger distributors a somewhat
curious situation revealed itself. In one sense a discussion of this point
is academic because it has not been demonstarted before me that in any
of the price agreements fixing the price of milk and other products to the
consuming public the capital employed has played any large part in deter-
minins; prices reached. The problem has apparently been generally an-
proached from another angle, that of cost. However, it cannot, I think,
be denied that the capital position of the distributor is always a matter which
must, in some degree, be in the background in any discussion of price. It is
a favourite device on the part of those attempting to show that the distri-
bution end of the milk industry is a monopoly to point to the large capital
structures built up by the various corporations engaged in a large wav in that
business. It would, however, seem to be bevond the scope of this Com-
mission, from a practical viewpoint, to determine the extent of capital infla-
tion in the industrv uidess it can be show n that it directlv "and significantlv
relates to the costs charged the consuming public for milk. It cannot. I
think, be said that anv such cause and effect were demonstrated before me
and I do not think any useful purpose is served bv going into what misht
be called the inflated capital position of the industry as it exists beyond
100 ONTARIO ROYAL COMMISSION ON MILK
what has been done by Mr. Entwistle in his study. That there are firms
in the industry in which such a condition exists is probably true, and the
financing which led to this condition may be generally attributed to what
are called the boom years before the depression of the 1930's.
In the report of the parliamentary committees investigating the milk
industry in Canada in 1932 it was said:
"We desire to draw attention to a few of the more outstanding facts as
disclosed by the evidence in respect to capitalization, depreciation charges,
etc., of those engaged in the sale and distribution of whole milk products.
"1. Capitalization. — Over a period of years there is a marked growth
in the capitalization of those companies which have been engaged in the
business for any considerable length of time. While much of this in-
creased capital was added in the ordinary way, because of increased
business, it is very apparent that over-capitalization exists. Some of the
ways in which this has been brought about are —
"(a) By purchasing or absorbing, by merger or consolidation of other
companies in the same line of business. These changes of ownership very
frequently took place at an enhanced valuation which generally involved
an increased stock issue bv the purchasing or parent company.
"(b) Goodwill. — Very substantial values were in many cases placed
upon goodwill. For such goodwill the purchasing or parent company as a
general rule issued common stock. No par value stock was used for this
purpose in the majority of cases. This stock while nominallv of no value,
gradually appreciated in value as time went on. became dividend bearing
and a charge upon the industry.
"(c) By 'splitting' shares. — The too-common practice of splitting or
dividing shares seems to have been indulged in by many of the com-
panies at one time or another during their history.
"2. Depreciation. — There is a very marked difference in the method
of calculating depreciation on buildings, machinery and equipment. The
Committee is of the opinion that depreciation reserves set up by manv of
the distributing companies, were calculated on an unwarrantedly high
basis, and that frequently depreciation reserves cover hidden profits.
"3. Bad Debts. — To a lesser extent the remarks in the preceding para-
graph might well apply to reserves for bad debts.
"4. Salaries. — Committee are of the opinion that salaries paid to some
of the higher officials of the various distributing companies are at this
time, entirelv too high and wliollv unjustifiable.
"5. Profits and Dividends. — Those engaged in the sale and distribution
of whole milk products have during these very difficult times, in a sub-
stantial way at least, been able, unlike most other industries, to maintain
their profits at the same level as in more prosperous times. It is true
that in certain cases dividends have been reduced and in some cases
discontinued. In the most of such companies however, substantial re-
serves continue to be set aside annuallv as in previous years. The Com-
mittee is of the opinion that dividends misht verv well have been declared
by some companies in which uroducer-shareholders are interested. The
failure to pay dividends in such cases has undoubtedly had the effect of
reducins; the value of the stock in the public mind and nossiblv cause
dissatisfied producer-shareholders to sell or dispose of their stock at
le^s than actual value.
"6. Merger. Purchase or Absorption of other Companies or Interests. —
The evidence presented to the Committee clearlv indicates that the sale and
distribution of whole milk products is gradually getting into the hands
ONTARIO ROYAL COMMISSION ON MILK 101
of fewer and larger companies. Economies to the companies interested
may have resulted, but there is no evidence of any benefits accruing from
such mergers to either the producer or the consumer. In many cases there
is evidence that mergers have removed competition and the general effect
is undoubtedly to give the distributors a more definite control of the
situation."
It may be that as a result of this investigation in 1932 some of the
larger distributors proceeded to squeeze what might be called the water out
of their capital structure. This, I think, explains the observations on page
86 of Appendix 18, wherein Mr. Entwistle points out that by the device
of issuing common stock to vendors of dairies, some of the larger
concerns did. in fact, at the time such sales took place, because of the high
market value of their securities, give a bonus for good-will, which Mr.
Entwistle puts in the aggregate at S20.305.360. Apparently only a very
small portion of this is represented in the capital structure of the com-
panies concerned today, and there is nothing to indicate that it is now
playing a part in determining the cost of milk to the consumer . Insofar as
the companies themselves are concerned, it would seem to have been a very
good practice. They, in effect, were asking the vendors of the dairies sold to
them to venture with them in the future prospects of the combined business.
The securities issued in treasury stock did not create fixed charges on the
industrv which might have affected the price of milk. If any returns were to
be obtained from such securities they had to be earned as profits by the
companies and disbursed as dividends, otherwise there was no liability
to pav. The willingness, however, of the vendors of various properties to
participate in this way again accentuates the fundamental condition I have
mentioned, namely, that if profits of any considerable scale are to be earned
by the distributors it must be by means of a large volume distribution. In
one sense I presume this may be called a monopolistic tendency inherent
in the industrv. and these tendencies will be discussed in some detail later.
Apart from that, however, it cannot be said to be anything more than a
recognition of the fact that a successful operation in the distribution end
of the industry, -if large profits are to be accumulated, must be a large
scale one insofar as volume of distribution is concerned.
This is further borne out by the study made by Mr. Entwistle of 390
distributing businesses, two hundred and sixty-two of which were small
enterprises having an annual sales volume not exceeding SIOO.OOO. In fact,
the average annual sales of this group was only S40,313. The combined
sales total of this smaller group represented 23.06 per cent of all sales
made by the distributors studied, while profit contributions of the same
enterprises represented only 19.89 per cent. The facts on which these con-
clusions are based are set out in Appendix "C" of Mr. Entwistle's report,
and it is worthy of note that the profits of the distributors having annual
sales in excess of SIOO.OOO show a tendencv to increase as sales volume
expands. This is true of all three groups. This would further substantiate
the suggestion that when large volume distribution is obtained, increased
profit margins may be expected to bear some fairly constant relationship
to sales expansion. Prior to this point, however, the distributor is in the
position where he has to expand his plant in anticipation of further business
before he gets it so that overhead cuts into his profits to the extent already
indicated in the case of the first group of distributors studied who have
smaller volume.
102 ONTARIO ROYAL COMMISSION ON MILK
Wage and Labour Costs
When wage and labour costs are examined in Mr. Entwistle's report,
the importance of large volume is further emphasized. During the years
1939 to 1945-46 the sales of fluid milk in the group of distributors studied
showed an increase of 109.18 per cent. This is higher than the provincial
average for the same period, which is 87 per cent. During the same period
average weekly ^vage rates increased by 35.01 per cent in the processing end
of the industry, 39.73 per cent in the selling and delivery part of the
industry, and 29.90 per cent in the administrative section. The over-all
average increase was 35.15 per cent. This increase of wage rates is a most
important element in the total cost of distribution. Selling and delivery
wages alone represent approximately 65 per cent of the total selling and
delivery expenses. It is significant, however, that when the labour cost per
quart is worked out as between 1939 and 1945-46, the increased labour
cost per quart advanced from 3.1899 cents per quart in 1939 to only
3.2815 cents per quart in 1945-46. an increase of .0916 cents per quart or
a percentage increase of only 2.87 per cent.
It is important when considering this to remember also that in payroll
disbursements there is an actual dollar value increase of 112.10 per cent in
1945-46 as compared with 1939, that the actual increase for selling and
delivery costs is 112.36 per cent, and the increase of personnel 52.36 per
cent. Large volume sales are undoubtedly responsible for the fact that the
industry has been able to absoxb these increased costs.
Something, however, must also be allowed for in the general increase of
efficiency and the wartime economy measures undertaken by the distributors
in 1942. To put it another way, it would appear that if consumption can be
increased and maintained at high levels it is possible to absorb a very
substantial wage and labour cost increase so long as increased volume of
consumption is maintained. On the other hand, the ability to maintain this
position must become increasinglv difficult as the volume of sales declines.
Conihined operations
At this point attention may be directed to the effect on profits of what
I have called a combined operation, that is, an operation involving the sale
of fluid milk, ice-cream, cream, chocolate drink, butter-milk and cottage
cheese, and sometimes butter, etc. In this regard reference may be made
to page 101 of Mr. Entwistle's report in Appendix 18.
The 58 distributors engaged in the combined operations do a very sub-
stantial portion of the business in the Province, and account for sales of
S51.587.177 out of a total sales of S90.000.000. being 57 per cent of the
total sales of all distributors. Of this the three large distributors account for
39 per cent and 55 independents 18 per cent. The profit position of these
companies accounts for 64 per cent of the total profits of the industry. As
against sales their profits are 4.12 per cent of their sales, which is con-
siderably above the general average. It is important to remember this when
the discussion of milk as a public utility is under consideration. I question
very much whether there would be any substantial prospect of laree profits
from public utilities restricting their operations to the sale of fluid milk
alone. If profits are to be made it would appear that such public utilities
would have to engage in the related and ancillarv operations carried on bv
the 58 distributors I have mentioned. This would be their only hope of
building up a profit position sufficient to justifv reduced charges to the
consuming public for fluid milk.
ONTARIO ROYAL COMMISSION ON MILK
103
Subsidies
As a war measure and as part of the general price control policy, the
Dominion Government paid a consumer subsidy of two cents per quart
effective December 16, 1942. This was continued until May 31st, 1946. The
total amount paid during this period was, I am advised, $29,649,963.97, or
and average of $8,471,418 per annum. The effect of this is discussed at Page
101 of Mr. Entwistle's report in Appendix 18.
Subsidy payments began at a time following the achievement of very sub-
stantial economies in the operation of the industry. These were effected by
the distributors themselves under pressure from the Wartime Prices and
Trade Board and the Milk Control Board. At this point it may be Avorth
repeating what is set out in the earlier part of this report which deals with
the work of the Milk Control Board. The following table shows the changes
which were made and the times they were effected:
July 1st, 1941—
Special Deliveries Eliminated.
February 1st, 1942—
(a) Cream sales limited to 2 grades.
(b) Cream Containers limited to 2 sizes.
(c) Store returns eliminated.
(d) Delivery service limited to one per day and to regular
wholesale accounts.
(e) Special bottle caps eliminated.
July 3rd, 1942—
(a) Charge on bottle made universal.
(b) Retail sales established on a cash basis.
(c) Wholesale credit sales reduced.
If the figures for fluid milk consumption are examined, it is found that
in 1941 there was a total sale of 290.089.000 quarts. In 1942 the corres-
ponding figure was 324.949.000 quarts. By 1943 it had increased to 386,-
645.000 quarts, and by 1946 the all-hisih total of 467.736,000 quarts was
reached. It is interesting to compare the-e figures with the over-all profits
before taxes of the distributors. The following table does not include the
figures relating to the three large distributors:
Statement of estimated overall net profits fhefcre taxes) for the years 1939 to 1946
irclvsive
Increase
over
preccdirg
\ear
%ot
Year Sales
1939 2.40
1940 2.45
1941 2.00
1942 1.60
1943 2.65
1944 2.95
1915 3.02
1946 2.70
TOTAL
Amount
S683.938
768.005
786,528
693.057
1.283.808
1.572.060
1.661.000
1,654,275
S84.C67
18.523
(93.471)
590.751
288.252
88,940
6.725
7r of
increase
12 29
2.41
(11.88)
85.24
22.45
5.66
.40
'< of
1939
100.00
112.29
115.00
101.33
187.71
229.85
242.86
241.87
$9,102,671
AVERAGE.. 2 53
(Note: Figures in brackets
represent decrease.)
$1,137,834
The above table relates to the independent distributors only.
104 ONTARIO ROYAL COMMISSION ON MILK
I am advised that the three large distributors show a proportionate increase
not in strict proportion to the independents, but nevertheless of a substantial
nature.
It is impossible, I think, to say which of the factors I have mentioned,
that is, the economies effected in the distribution end of the industry, the
consumer subsidy or the large increase in volume of sales to consumers, was
responsible for the large increase in profits to the distributors as between
1942 and 1943, a process which continued down to 1946, but I think it is
fair to say that the combined operation of these factors produced the im-
proved profit condition indicated. It would, in my view, and in this I am
confirmed by the Accountant, be impossible to now unscramble the omelette
and to value each of these factors in any accurate way. The lowering of
consumer price and the improved purchasing power of the average consumer
during these vears doubtless also played a part. Of these it is difficult
to avoid the conclusion, however, that the most substantial influence on
the increase in volume of consumption was exerted by the lower price. It is
quite true that the improved purchasing power of a large part of the popula-
tion during the war years must also be recognized.
Other General Considerations
From the financial studies it is quite apparent that the increased volume
of sales over the war years, combined with the consumer subsidy and
operating economies, placed the industry in what may be described as a
very healthy condition. As evidenced from Mr. Entwistle's report, very
substantial amounts have been set aside by the industry on the average
to meet depreciation on plant and equipment which was used to full
capacity through the war years. It can be said also that at the present time
the industry is in a position where it is fully equipped to process fluid milk
in sufficient quantities to ensure adequate supplies to the consumers at the
present or higher levels of consumption. It is a fact that the present plants
of the distributors are geared to an output almost twice that of 1939 and
the maintenance of this large volume consumption must be one of the most
serious concerns of the distributors. It is quite apparent. I think, that any
substantial or continued reduction in volimie would substantially increase
the distributor's costs. One cannot study Mr. Entwistle's report without
realizing that the percentage of profit in relation to sales is a small one.
The distributor of fluid milk works on a very narrow marjjin. This is
simply another way of saying that as the profit on each unit sold is a fraction
of a cent there must be a large volume of such units to create any con-
siderable profit.
It also, of course, emphasizes one of the great dangers of the industry,
that is that if the small profit position is not maintained large and ruinous
losses might speedily occur.
The determination of the price charged the consumer therefore becomes
a auestion of considerable nicety and one which mav very well mean the
difference between a profit and a substantial loss. This raises the general
problem of a fixed price to the consumer in any given market.
Tendencies to Monopoly
Many of the consumer representatives appearing before the Commission
suggested that the distribution of fluid milk was in the hands of a monoply
and in making; this suggestion they pointed to the three larger companies
operating in the Province. In view of the number of licensed distributors,
which is in excess of 850, this is hardly a tenable view. However, it is
unquestionably true that in volume and dollar value a substantial part of
ONTARIO ROYAL COMMISSION ON MILK 105
the dairy business in Ontario lies in the hands of three corporations,
namely, The Borden Company Ltd., Silverwoods Dairy Ltd., and Dominion
Dairies Ltd., (comprising the Acme and Producer Companies in Ontario).
For the purposes of convenient reference these may be referred to as
"The Big Three."' For the year 1945 these three companies marketed 30%
of the total dollar value of all fluid milk marketed in the Province. The
proportion of cream and chocolate drink which they marketed also approxi-
mated 30^/f of the total dollar ^alue of the sales of each product within
the Province, while as regards butter and ice-cream it would appear that the
combined sales of the three concerns was substantially more than 30 per
cent of the total estimated sales of such products by the fluid milk industry
within the Province of Ontario.
It should be clearly understood that the foregoing proportions are
based on the estimate of the fluid milk industry's over-all sales in Ontario
of ninety million dollars, which amount has been developed by Mr.
Entwistle as shown in Table 14 of his report.
These three companies unquestionably exercise a large influence in
the industrv in Ontario, not only because of the efficiency of their methods
and the high quality of their products, but because of the lead which they
give independent concerns which operate in a similar fashi(jn. The
great diversification in their operation which, as will be pointed out
later, has a verv substantial influence on their profit position and theii
earning capacity, is a matter for serious consideration. This will be apparent
when it is realized that, out of an estimated total of S37.000.000. represent-
ing products other than fluid milk itself, sold by fluid milk distributors
during the fiscal year next preceding 1st October, 1946. approximately 53
per cent was sold by these three large companies.
In the result thev are in a position to exercise a powerful influence on
the industry. The most that can be said is that while there is no actual
monopoly, the distribution of fluid milk is a business in which large
profits lie in large volume of distribution, and this fact naturally tend=
towards monopoly. From the consumer viewpoint, as long as this tendency
does not crystalize into actual monopolv control, it may not be a bad
thing. As an example of the tendency, the concentration of the distributing
industry in a few hands may be exemplified by the record set out in
Appendix 20 of the Toronto market in the years since the Milk Control
Board was established. Briefly, starting in 1934 with 95 licenses issued.
1945 saw the number reduced to 53. largely through sale and amalgamation.
This tendency, which is more apparent in the markets with large populations,
is a development to which due weight must be given in determining any
general policy of control and of price fixing.
If the tendency observed is as strongly marked under conditions in
which the price paid the producer and the price charged the consumer
are both fixed by governmental authority, it becomes a very important
matter to determine, from the viewpoint of public policy, which direction
the industry is to take in future. The problem is, of course, closely con-
nected with the practice heretofore obtaining of fixing consumer prices,
and will be discussed in greater detail. At this point it is sufficient to say
that if efficiency alone and a low consumer price is the prime end. then
an acceleration of the process may be desirable. If distributive monopoly
grew, presumably density of delivery should increase accordingly. This
might have profound effects in decreasing the amount of delivery costs.
If, on the other hand, the maintenance of a large number of distributors
is desired, then the process should be discouraged. It should also be
106 ONTARIO ROYAL COMMISSION ON MILK
considered whether, in the event that monopoly, or quasi monopoly: is
reached, the public can then he adequately protected by government
regulation or whether, under that situation, the ultimate remedy in the
public interest may not be an over-all publicly owned utility. The de-
sirability of this solution, which has considerable consumer support, will
be examined later.
Fixation of Consumer Prices
Almost without exception both producer and distributor witnesses
expressed the view that it would be disastrous to the industry as a whole
if the system of fixed prices to consumers for fluid milk was abandoned.
The fear on the part of the producers was that, with the pressure
of competition on the distributors, the objectionable practices which
obtained in 1933 and earlier years of the depression would return, and
that some producers would be induced to sell milk at below the price
fixed by law or would give secret rebates. It was also feared that it
would be impossible to maintain the producer price structure unless
the fixed consumer price was also maintained. The argument for the
distributors was most ably put in writing to me by their Counsel, and
I do not think I can do better than quote it. It was put as follows:
"The Association does wish, however, to again comment brieflv on
one important matter that has been repeatedly raised before thj
Commission, namely Price Control.
"Virtually all those who have appeared before the Commission have
approved of the principle of a fixed price to the milk producer, but
there has been some considerable difference of opinion as to the ad-
visability of permitting or compelling a fixed price to the consumer.
Accepting the wisdom of the control of producers' prices, this Associatioji
submits that such control will, in practice, be ineffective unless it is
accompanied by a controlled consumer price, and that to have the one
without the other will soon result in instability of production prices,
particularly during periods of abundant milk supply. Logically, it
may be argued that a free consumer price makes for true competition
and for efficiency within the industry. Practically, and based. on former
experience, it would seem to be likelv to result in a chaotic condition
harmful to producer, consumer and distributor alike. Apart altogether
from the possibility that some of the less ethical distributors and pro-
ducers may make under-cover deals for rebates and allowances, there
is the fact that in man^' Ontario markets there are producer-distributors,
producing their own milk and marketing it to their own customers, and
it is submitted that it is impossible to enforce, as to these operators,
anv fixed producer price. Thev can comply with any price fixing regu-
lation by crediting themselves with the proper producer price, but it i?
difiicult to see how they can be compelled to observe any such hypi)-
thetical cost when they come to fix their selling price. Any large scale
price cutting by producer-distributors or by any other distributors
would result in a price war, as established distributional concerns would
be compelled to meet competitive prices even if they did so at a loss,
and in the long run the costs of price wars are paid for by the con-
suming public.
"It is significant that the majority of producers and their associations,
in giving evidence before the Commission, favoured both a producer and
consumer fixed price, and it is equally significant that every Province
of Canada has Milk Control legislation not unlike that of Ontario.
107
of both
common
leference
:er price
but it is
ers and
may be
by trade
n States
ixing of
he more
Y, Penn-
fix con-
at there
i of all
ollowing
I should
t should
nit it to
the con-
and the
ion.
troducer-
i quality
ces to a
not im-
ocessing,
i already
omewhat
iw years
s at the
bly with
siderably
;re there
Dervision
le fixing
is would
'r is the
k which
counting
ributors.
at the
icers.
ience, if
ng them
practice,
do away
equisites
asis that
enforced
acticable
ONTARIO ROYAL COMMISSION ON SULK 107
and in every province there is some measure of fixation of both
the buying and the selling prices. It is submitted that the common
experience rather than the theory, furnishes the best guide. Reference
has been made to the fact that in many U.S. markets the producer price
is fixed while the consumer price is free, and this is admitted, but it is
suggested that in most of such markets both the producers and
distributors are particularly well organized, and while there may be
no legal fixing of the selling price, it is in practice stabilized by trade
agreement. It should also be borne in mind that some sixteen States
of the Union have legislation authorizing or permitting the fixing of
both prices, there being included in the list a number of the more
populous states, such as California, Massachusetts, New Jersey, Penn-
sylvania, etc. (See Bartlett 'The Milk Industry,' page 82).
"This association does not ask for the untrammelled right to fix con-
sumer prices by agreement within the trade, but concedes that there
should be s*-'ct and constant supervision by the Milk Board of all
prices, and that the price schedules should only be approved following
careful and complete inquiry by the Board; that the Board should
consider conditions existing in each market area; and that it should
keep running statistics as to costs, profits, etc., so as to permit it to
make revisions from time to time to ensure that at all times the con-
sumer price is such as to give the producer a fair return and the
distributor no more than a fair profit, based on efficient operation.
"It is also submitted that the maintenance of a stable producer-
consumer market price of milk is essential if the present high quality
of the product is to be properly guarded. The cutting of prices to a
point where some dairies will find it difficult to operate will not im-
probably result in a letting down of the care presently taken in processing,
and in a diminution of service to the consumers. Finally, it has already
been pointed out and I beg leave here to repeat, that under a somewhat
rigid system of price control the price of milk over the last few years
advanced less than the price of other food commodities, and is at the
present time in Ontario sold for a price that compares favourably with
that being charged anywhere in North America, and is considerably
under what is being charged in those major U. S. markets, where there
is no consumer price fixing. With proper and constant supervision
and survey by the Milk Control Board, it is submitted that the fixing
of the consumer price will be in the interest of the consumer as would
seem to have been demonstrated over the past few years."
In my opinion the obvious answer to the fears of the producer is the
creation of a marketing authority for the producers of fluid milk which
would deal directly with the distributors, which would handle the accounting
and which in effect would stand between the producers and distributors.
While this may not be a practical solution of the difficulty at the
present time, it is the only satisfactory solution open to the producers.
In my view, which is based on considerable personal experience, if
prices paid to producers are to be fixed, the difficulty of enforcing them
where there is no effective control over the source of supplv. is, in practice,
very great. It may well be that, if it is considered desirable to do away
with a fixed price to the consumer, that one of the essential prerequisites
of such a move is the organization of the producers on such a basis that
they can enforce the price fixed to them, or that it can be readily enforced
by an agency of government. If such an organization is not practicable
108 ONTARIO ROYAL COMMISSION ON MILK
at the moment, consideration should be given to fixing minimum prices
to consumers at a level sufficient to protect the fixed producer price. I
was advised that this was practised in the Montreal market. Insofar as the
distributors themselves are concerned, such a move would immediately
restore a large measure of competition which has now ceased to exist.
It has been pointed out that in the United States, as a result of the
depression in the 1930's, some 26 states enacted legislation to fix prices
which consumers should pay for milk. By the end of 1940 this practice
had been discontinued in eight states and the federal government had also
abandoned it. Apparently the populous states of Indiana and Wisconsin
have since discontinued their control, and of the 18 states New York and
Connecticut do not authorize the fixing of consumer prices. It is worthy
of note, however, that the producers in three of the principal markets in
New York State are organized in a much more substantial way then they
are in Ontario and reference to a discussion of this may be found in
an earlier part of this report dealing with producers.
One of the tendencies which might develop if consumer price fixing were
abandoned in Ontario is the acceleration of a process towards monopoly.
This at least would happen if the removal of the fixed prices resulted
in price competition among distributors. It is quite clear that when
marketing agreements are being reached and consumer prices are fixed
under them with the backing of the Milk Control Board, not only the
larger and more efficient distributors must be kept in mind but the
requirements of all distributors in the particular market under consideration.
If a consumer's price is fixed it must be one which may well result in a
profit to the large volume distributor entirely out of proportion to that
enjoyed by the smaller distributor.
It is a matter of general public policy to decide whether it is desirable
in the distribution of fluid milk to have a few large and efficient dis-
tributors or whether there is sufficient social value in the maintenance of
the 850 or more which at present operate in the province. I am satisfied
that the gradual process towards consolidation, amalgamation and the
purchase by larger units in the distribution end of the industry, would
be greatly accelerated if the practice of maintaining a fixed consumer
price w'ere abandoned. It unquestionably cannot be abandoned without
a cost to the community. This is a matter of policy on which it would
not be proper for me to comment but the problem is a real one and
must be faced. At a time, however, when it is obvious, I think, that the
consumer price of milk is decreasing the consumption, it may well be that
the consumers are entitled to the benefit of large scale operations and a
lower price from those distributors who can afford to offer it. It must, I
think, be recognized from the experience of the years since 1939, and
in other jurisdictions, that cheaper milk means larger consumption of milk.
As will appear in the chapter dealing with the consumer case as pre-
sented to me, the increased price was represented to be a particular
hardship on the lowest income groups. I doubt, however, whether the
evidence produced in support of this view^ substantiates the position taken,
which at times seemed to resemble propaganda rather than any serious
presentation based on the facts of the case.
While there can be little doubt of the desirability of increased milk
consumption on the part of the lowest income group, the evidence that I
have heard raises serious doubt as to whether the members of this group
have ever been substantial consumers of milk. They are probably too close
to subsistence level to afford it. Unquestionably during the war years
ONTARIO ROYAL COMMISSION ON MILK 109
many of them, through their greatly improved incomes resulting from
work in war factories, and because of shortages of alternative beverages,
particularly those utilizing sugar, consumed considerably more milk in one
form or another than they normally did. There were, for example, large
sales of chocolate drink in the factories. In the survey made on behalf
of the Dominion Dairy in Toronto, evidence was given by Mr. Aird which
indicated that in those parts of the market occupied chiefly by persons of
low income, there was not a substantial consumption of milk in the home.
The evidence I received from one representative of the Neighbourhood
Workers Association in Toronto, called by Commission Counsel, indicated,
however, that there had been a very substantial increase in consumption
in what might be called the lower middle income group, that is where
the wage earner earned $30.00 to $40.00 a week. This group had been
reached by the nutritionists in the various Departments of Health and
had become convinced of the necessity of larger milk consumption.
Admittedly members of this group have been very hard hit by the increase
in price of milk to the consumer in October, 1946. This group, of course,
has also been very seriously hurt by the large increase in the cost of
other necessary commodities, which has taken place over the last eighteen
months. Despite this, however, I think it can still be laid down as a general
principle that cheap milk for the most part means very substantial con-
sumption. This has been experienced in other jurisdictions and it is
interesting to see that in England, in the report of the Reorganization
Commission for Milk made in 1933 under the Chairmanship of Sir Edward
Grigg, the following observation is made:
"The retail price for milk in this country since the war has been
maintained at a level which makes it difficult to guage a fair price
based upon consumption over any considerable period, and there is no
ground for assuming that lower prices would not lead to increased
consumption. The fact that retail prices in this country have not fallen
in sympathy with other retail prices may be assumed to have restricted the
sale of milk in some measure. If the demand for milk is to be extended
gradually but steadily iny future years, stimulus which would be given to
this movement through a lower retail price must be constantly borne in
mind."
The findings of numerous milk consumption studies undertaken under
the supervision of Dr. W. C. Hopper, then of the Economics Division of
the Dominion Department of Agriculture, in different parts of Canada,
clearly indicate that the factor mainly responsible for determining the
amount of milk consumed is the economic ability to purchase it. The same
general conclusion has been arrived at in many similar studies made in
various parts of the United States in recent years.
Cheap milk is, therefore, a very desirable end to be obtained, and if
competition as to price results in attaining it, then in my view it is a com-
petition which the consuming public are entitled to have in the industry,
and of which they should obtain the benefit.
The alternative to insuring effective competition in the industry is a
control through the agency of Milk Boards with ample price fixing power,
who would progressively force a narrowing of the distributor's spread.
It would be necessary to establish such boards with sufficient power and
freedom from interference to bring this about. Such a control is obviously
very expensive to the public. It would involve the acquisition of the most
110 ONTARIO ROYAL COMMISSION ON MILK
detailed knowledge of the cost and profit position of each distributor, and
would be necessarily arbitrary and onerous to the industry.
I am satisfied, however, from the evidence before me, that it is only
by some such pressure, either that of competition or of government
control of prices, that the industry can be moved to effect the necessary
economies in the distribution end, which would lower the cost of dis-
tributing milk. In my view this end is essentially desirable. I think
the results would be better if the industry was left to find these means
itself, but unless there is sufficient pressure to bring it about as a matter
of necessity, the experience of the last fifteen years would indicate that
the industry moves with extreme slowness.
If government control is selected, it will logically lead in the end to public
ownership of the means of distributing fluid milk to the consumers. As
will appear in the chapter dealing with the consumer, there was an almost
pathetic belief on the part of consumer representatives who appeared
before me that the creation of such a form of public ownership would
inevitably result in cheaper milk, I see nothing in the experience
in other jurisdictions or in the evidence I heard which would justify this
assumption. It is quite true that if the sale of milk through a public
utility reached large volume, in the eventual result the profits accruing
from such sales, if they were at prices w'hich would permit of a reasonable
profit, would accumulate and might be used to improve the processes
employed or lessen the cost to the consuming public. In any event such
a solution is one which would take a considerable period of time and
offers no immediate reduction in the price of milk to the consuming
public. Probably the most efficient municipal dairv in the world is thai
at Wellington, New Zealand, and it underwent nearly five years of operation
before it was in a position to pass back any of the benefits it obtained from
consolidation in distribution to the consuming public. This indicates in
the initial stages of public utility distribution large capital outlays are
required. This fact alone prevents anv immediate possibility of consumer
price reductions if this method of distribution were adopted.
Public ownership does not necessarilv mean cheaper milk unless it is
a very well managed public owernship. The dairy industry is admittedly
one which requires expert management and long experience.
As I have said, unless some real competitive element is introduced into
the business at the present time, or unless pressures are brought on the
distributors by government control, there is very little hope of the necessary
economies being found or developed. If some means can be found by
which a large number of those in the distributing end of the industry can
put into effect a co-operative effort to lessen costs of distribution, such as co-
operative deliveries, or if, for example, they found it advisable to enter into
co-operative purchasing of supplies or could agree on the maintaining of the
economies effected in 1942 under the pressure of w^artime conditions, there
would seem to be some hope of eventually reducing milk prices to the con-
sumer. It is quite true that probably none of these measures in themselves
would result in any startling savings. However, if a concerted effort were made
by the industry, the adding together of all the small savings which might
be effected would in the end prove substantial. At the moment the possi-
bility of securing such general agreement in the industry seems far removed.
Conclusions on Price
Looking at the matter strictly on a cost basis, I do not think it can be
said that present prices are unreasonable from the viewpoint of the distribu-
ONTARIO ROYAL COMMISSION ON MILK 111
tor. But the distributor should bear in mind that he has an obligation to
the public to furnish his product more cheaply if it can be so furnished. If the
distributors themselves cannot effect a further rationalization of the industry
then it seems to me that one of the pressures which I have mentioned must
be applied in the public interest.
To repeat, the oft repeated belief by consumer groups that public owner-
ship of distribution would immediately result in large scale economies is
not, I think, warranted. Such a result does not arise because ownership is
either public or private, but must arise from lower costs achieved by better
management, by more effective and rational methods of distribution irrespec-
tive of the form of ownership. If privately owned industry cannot obtain
these results in connection with a vital food product, there is very strong
argument for public ownership where these methods can presumably be
given a trial.
One other method of insuring some measure of actual competition would
be to permit the formation of consumer co-operatives which are in effect
prohibited by Section 11 of the Milk Control Act, which was passed to help
maintain the concept of the fixed consumer price. Surely if consumers can
operate under proper sanitary standards they should be allowed to try and
provide themselves with cheaper milk by being allowed to share in the
profits of their operations by receiving patronage dividends. Consideration
might well be given to eliminating Section 11 from the Milk Control Act. It
is absurd to suggest that the distributors cannot face this form of competition.
These matters will be discussed later at greater length, but the industry
must now seriously consider them.
Financial Assistance to Aid Consumption
Under present circumstances, without any of the changes which I have
suggested, I think it can be fairly said that, taking an over-all view, and
disregarding the position of the large distributors, there is no hope at the
present moment of cheaper milk to the consuming public, apart from some
form of government assistance to consumers such as the consumer subsidy
paid by the Dominion Government during the war years. The objections to
such payments, both from the viewpoint of the industry and the public, are"
serious. While they may well have been justified in view of the over-all
price policy under the emergency of war, in my view they are not justified
under peace time conditions.
Subsidies tend to create a false sense of values in the industry, they
perpetuate static condition and, if sufficient, remove the incentive to better
and cheaper methods of distribution. Moreover, they in effect create a false
sense of security for both distributor and consumer as well as the producer,
and any change of policy which suddenly removes them creates serious
dislocations. There is, in addition, the psychological objection that the
payment represented by such subsidies is not something that is truly earned.
In the representations made to me in favour of them no attention was paid
to the source from Avhich they were to come. And there was no clear
realization that they involved a social cost directly out of the taxpayer's
pocket. Any subsidy which would discriminate in favour of those who
might need it because of their low income was rejected as charity or as
creating unnecessary humiliation in the recipient. It would seem to me that
this is a distinction without a difference. Their charitable nature would
seem to persist irrespective of the income of the recipient. If public charity
is humiliating for some it is surely equally so for all who receive it. As to
112 ONTARIO ROYAL COMMISSION ON MILK
the cost of the subsidy, if the experience of the war years is any guide the
amount required to effect even a two cent reduction per quart of milk would
amount to something between eight and nine million dollars a year. Pre-
sumably this money would have to be raised from the public pocket by taxes,
and it might well be said from the viewpoint of many consumers that what
they save at the kitchen door they would lose in the additional taxes they
would have to pay.
If it were deemed socially advisable to reduce the cost of milk by public
assistance so as to make it readily available to those persons in the com-
munity needing it most, the only recommendation I would have to make is
that consideration might be given to supplying school children with milk
free or at low cost irrespective of age or income group. Under the somewhat
different food situation existing in the United Kingdom this policy was
adopted and has met with a very fair measure of success. It would un-
questionably appeal to health authorities. In effect those who can most
benefit from its consumption as an article of diet would be assured of at
least a minimum supply. In a small pamphlet describing the functioning
of the milk marketing scheme in Britain, prepared for ex-service employees
of the scheme, the following paragraphs may be of interest:
"SCHOOL MILK
"A word as to this Milk-in-Schools Scheme, which played such an
important part in increasing consumption. The credit for introducing
this scheme belongs to the National Milk Publicity Council. It received
a great fillip from the introduction of the Milk Marketing Scheme when
the Board and Distributors co-operated with the Ministry of Health and
arranged the extension of the provision of milk at cheap rates in 1934,
so that children received one-third of a pint of milk for 5^d., equivalent
to 1/- per gallon. The loss on this reduced price was borne by the dis-
tributor and the Board together with assistance from the Government.
"Experiments were also carried out in depressed areas such as the
Rhondda Valley, Whitehaven, Jarrow and Walker-on-Tyne in which
young children, nursing and expectant mothers received milk at a reduced
price at the rate of one pint per day. It was seen at once that the average
consumption of milk increased appreciably. The result was that in 1938
it was decided that a scheme of a similar type should be applied through-
out the whole country, but with the introduction of an income limitation.
Controlled by local authorities, the scheme was gradually coming into
operation when the war began and was subsequently replaced by the
National Milk Scheme.
"SPENDING POWER AND MILK
"Consumption began to rise after the out-break of war because of
the increased spending power of the lower income groups. The import-
ance of milk for young people and mothers from a nutritional aspect was
recognised in July, 1940, and the National Milk Scheme was introduced.
This entitled expectant mothers and children up to five years of
age to one pint of milk per day at 2d. per pint. Where the applicants'
income did not reach a certain level it was supplied free.
'The success of this scheme can be seen in that the amount of milk
sold under it amounts to 150 million gallons per annum. Through the
School Milk Scheme consumption is 43 million gallons a year."
ONTARIO ROYAL COMMISSION ON MILK 113
Apart from this somewhat Hmited form of public assistance to greater
milk consumption it would, I believe, be better to pursue methods in re-
organizing the industry itself to achieve cheap milk distribution. Such a
course of action would create a condition justifying cheaper prices as a
result of the actual operation of all phases of the industry and would not
rest on the artificial foundation of gratuitous assistance. To grant such
assistance is equivalent to admitting defeat in obtaining better and more
rational methods of distribution. No such necessity has yet been
demonstrated.
114 ONTARIO ROYAL COMMISSION ON MILK
CHAPTER VIII
Examination of the Fluid Milk Price Increase
October 1st, 1946
I have not dealt, except in a general way, with the specific price increases
for fluid milk which occurred at the end of September, 1946. I asked Mr.
Entwistle if, on the basis of his general over-all figure, he would calculate
the result to the industry if the price increase had been limited to two cents
per quart with the corresponding variations for other items, instead of the
three cents which was arrived at. He has also worked out what the result
would have been if the price increase had been two and a half cents instead
of three cents, and the following table which he has furnished me shows
the results of these calculations:
PROJECTED STATEMENT OF NET PROFITS (BEFORE TAXES)
FOR TWELVE MONTH PERIOD
ALLOWING FOR SALES OF 430 MILLION QUARTS OF FLUID MILK
ON THE BASIS OF 15 CENTS AND IS^/^ CENTS PER QUART TO
THE CONSUMER
Overall On Basis of
15 cents 15^^ cents
Estimated net profits from all products
other than fluid milk $2,382,831 $2,382,831
Add:
Estimated profit from fluid milk
based on 430 million quarts at .21 of
one cent per quart as quoted in report
for 13 cent milk 903,000 903,000
$3,285,831 $3,285,831
Add:
Estimated additional revenue from
advance in price from 13 cents to 15
cents and 151/2 -cents 8,600,000 (a) 10,750,000
$11,885,831 $14,035,831
Deduct :
Amount to be passed back to producer
2.63 cents equal to $1.00 per 100 lbs.
of whole milk 11,309,000 (b) 11,309,000
Adjusted net profits of distributive industry
before provision for profits and taxes . $576,831 $2,726,831
ONTARIO ROYAL COMMISSION ON MILK
Fluid Milk
Profit as above
Add:
Item (a) .
Deduct:
Item (b)
115
On Basis of
15 cents 15i/^ cents
$903,000 $903,000
8,600,000 10,750,000
Profit or (loss)
11,309,000
($1,806,000)
(loss)
),503,000 $11,653,000
11,309,000
$344,000
(profit)
The above projection does not allow for variations in cost due to dififerences in
volume neither does it allow for any increases in costs which may have
occurred since the latter part of 1946.
The effect of a difference of one-half a cent a quart in this calculation is
quite startling and illustrates the point made in the chapter on distributors,
that is, that they operate on a very narrow spread. It is, I think, quite
obvious that a sum as small as half a cent a quart can have a profound effect
on the profit position of the distributors.
I think it should also be recognized thai this calculation speaks after the
event and after some months of its operation, and not in advance, and
indicates the essential undesirability of price-fixing at the consumer level.
It is asking too much of the Milk Control Board, or any other rate-fixing
body, to calculate the consumer price of milk to the point where an abso-
lutely desirable result, insofar as the consumer is concerned, can be guaran-
teed. If fractional rates affect the industry's profit position in such a marked
way. it places a responsibilitv on the price-fixing body beyond what should
be reasonably imposed. In advance of the actual operation of such a price,
the price arrived at must always be essentially a good guess, and therefore
more or less an arbitrary one. It is quite obvious that even a fraction of a
cent too much results in tremendous profit to the large volume distributors.
It is equally obvious that a fraction of a cent too little may result in equally
large losses, not only to the large volume distributors but to all the dis-
tributors.
Looking at all the distributors, it must be remembered that in number
the great majority of them are not large volume distributors. As appears
from Mr. Entwistle's report, there are about 58 who engage in what he
calls a blended operation, that is, who sell substantial quantities of other
dairy products in addition to fluid milk. As I have stated earlier, the total
number of individual distributors in the Province is something in excess of
850. In the opinion of the Accountants, the remarks which I am about to
make would apply to something less than 150 of tlie total number. Looking
at all the distributors in this way, therefore, it cannot be said that the prices
reached at the end of September, 1946, in view of the over-all circumstances
and position of the distributors, were unreasonable. Nevertheless, as Mr.
Entwistle suggests, and I agree, there are unquestionably many large
volume distributors who can afford to sell milk for less than they are doing
at present. The number of these, however, is less than 150 and, in Mr.
Entwistle's opinion, would constitute roughly not more than 12 per cent
116 ONTARIO ROYAL COMMISSION ON MILK
of all distributors. This group, however, apparently sell in excess of 50
per cent of the total of milk sold for fluid consumption in the Province. The
general conclusion to be drawn from this should be obvious to all. Attention
is directed to the concluding observations in Mr. Entwistle's report in
Appendix 18, w^here the matter is also discussed.
This calculation illustrates in a most graphic fashion the essential un-
desirability of fixing prices at the consumer level. It also underlines the
observations made earlier in the report regarding the essential difficulty
of arriving at prices which wall permit the whole industry to operate on a
profitable basis. The profit bonus to the large volume distributor in the
result is generally out of all proportion to his needs. It is obvious from
what has just been said that, if prices are fixed at the consumer level, any
price so fixed sufficient to guarantee the continued existence of the many
smaller distributors, will result in inordinate profits to the larger volume
distributors.
ONTARIO ROYAL COMMISSION ON MILK 117
CHAPTER IX
Consumption and the Position
of the Consumers
General
The case presented by those representing the consumer groups before the
enquiry was based entirely on need. The only criticism of the existing
structure was directed at the distributive end and in the case of certain
witnesses there was an implied assumption that lower prices for milk could
be secured if certain changes in distribution were brought about. No facts
to support this were presented. No concerted effort was made by any
consumer body to consistently follow the course of the Commission's enquiry.
Most valuable assistance was rendered, however, in the early days, by the
presence at the enquiry as Counsel for the consumers of St. Patrick's Riding
of Mr. A. Kelso Roberts, K.C., M.L.A., who represents that Riding for the City
of Toronto. Mr. Roberts' help in cross-examination of the witnesses was
of very great assistance. Apart from this, Commission Counsel, in pursuit
of his duties, tried with considerable success to see that the consumer's
viewpoint was examined and dealt with in the course of the evidence. The
only places where any coherent and concerted effort was made to examine
the consumer position was in the Cities of Ottawa and Windsor. In Ottawa
Mr. Gordon Medcalf, K.C., the City Solicitor, appeared, together with two
ladies of great ability, Mrs. A. S. Whiteley and Mrs. Russell White. In
Windsor a group of housewives who were interested in the problem gave
me the advantage of their opinions and viewpoints and I would like to record
my appreciation of their assistance.
A certain amount of evidence on behalf of consumers was also received
from those representing various labour unions, the C.C.F. party, representa-
tives of the Progressive-Labour party and what is known as the Consumers'
Federated Council of the City of Toronto.
Apart from the brief of the C.C.F. party, which discussed the situation in
many aspects and was most suggestive, the difficulty with most of these
representations as far as the enquiry was concerned, was the fact that beyond
stating that milk was a necessary and essential article of diet, that its
increased consumption was greatly to be desired, that the 1946 price
increases had seriously curtailed its consumption on the part of the lowest
income group, there was very little effort made to examine either the reason-
ableness or unreasonableness of the price increase insofar as the economic
factors relating to it were concerned, nor to indicate practical methods of
bringing about price reductions. This was qualified by three suggestions
made, firstly, that fluid milk should be distributed through publicly owned
utilities; secondly, that government subsidies be renewed to reduce the
consumer price; and thirdly, that the Milk Control Act should be amended
so as to permit the complete functioning of consumer co-operatives.
As I have said, the case was put principally on the basis of need. With
almost complete unanimity, these groups indicated their belief that producers
should certainly receive their cost of production plus a reasonable profit.
118 ONTARIO ROYAL COMMISSION ON MILK
They were also desirous that the deliverymen for the dairies should receive
their present or better scale of wages. In this connection I do not think
I am unfair in saying that there they stopped short. At no time did I
receive any adequate explanation of how these costs were to be met, and
how the obtaining of cheaper milk could be made consistent with present
or increased costs resulting from higher producer prices and higher returns
to deliverymen.
It is perhaps natural that this should be the case. Owing to the dissemina-
tion of knowledge from various nutritionists in respect to milk as an article
of diet, there is no question that a large section of the general public during
the last few years had begun to gain a much fuller appreciation of the value of
milk as a food. Its special desirability from the standpoint of growing
children has become increasingly realized. The consumers are a disorga-
nized and incoherent body. It is natural that they should be such. It
was not to be expected that any concerted and consistent effort would be made
on their behalf before the enquiry.
As previously indicated, three concrete suggestions emerged from the
representations made by these witnesses. The first suggestion was that the
way to get cheaper milk for consumers was to lower prices through the public
ownership, whether municipal or provincial, of the means of distribution,
secondly, legislation permitting consumer co-operatives and patronage divi-
dends, thirdly, it was suggested that, if other means failed, there should
be a subsidy from public funds. In most cases the suggestion was that it
come from the Provincial Treasury in the form of a direct consumer subsidy.
I have discussed the merits of this suggestion in the chapter on the Distribu-
tors. Generally it can be said that the consumer position, despite the various
forms in which it was presented, was that milk was a necessity of life; that
if any means could be found to reduce its cost to those who needed it,
namely, the consuming public and particularly those who had no financial
ability to buy sufficient quantities of it, such means should be found. If
sound methods can be discovered to achieve this result I am in agreement
with this view.
Dealing with the second suggestion first, that is the suggestion that the
consumption of milk should be directly subsidized by the Provincial Govern-
ment, I have already discussed this suggestion in the chapter dealing with
distribution. As far as the various consumer representations were concerned,
thinking had not proceeded beyond the suggestion itself. Very little atten-
tion was paid to the source from which the money was to come. It seemed
to be assumed that it could come from some inexhaustible supply which
could be drawn on without much cost to anyone. Nothing, of course, could
be further from the truth. If the retail consumption of milk is to be sub-
sidized, it is obviously a subsidy which would come from Provincial funds,
and it could only be obtained from the imposition of taxes additional to
those already imposed on the people of the Province. However the tax
to supply these funds might be devised, the consumer would be paying them
out of one pocket and obtaining the benefit of them, in accordance with the
amount of his consumption of milk, in the other. There is, of course, the
inescapable fact that the taxes would presumably fall on those most able to
pay them, although this cannot always be assumed, and the subsidy would
benefit all alike irrespective of income or financial situation. It was sug-
gested that the subsidy might be limited to those whose need was greatest.
As far as the witnesses before me were concerned, they uniformly rejected
this suggestion, chiefly on the ground that any such distinction was humi-
ONTARIO ROYAL COMMISSION ON MILK 119
liating, and that where a necessity such as milk was concerned, a means test
should not be required of those Avho were not fortunate enough to be able
to buy adequate quantities of it.
Insofar as the suggestion that the price increase had deprived the lowest
income groups of their supply of milk, there was no direct evidence of this
before me. The assertions were baldly made without supporting or factual
data. The only factual data received was a survey filed on behalf of one
of the distributors, which recorded the results of a sample taken in the
City of Toronto by the Canadian Facts Limited, an organization whose
reports, I believe, are reliable, and can be accepted. In this survey, which
I am including as Appendix 21, because of its importance, a cross-section
of the Toronto market was taken. Income groups were divided into High,
Second, Third and Low categories, and information was obtained on a
number of points of interest to the enquiry. Of the Low Income group,
26.3 per cent stated they were buying substantially less milk since the price
increase. The Third Income group were also reported buying 25.5 per cent
less, while the High Income group and the Second group showed reduction
in purchases of 14 per cent and 13.3 per cent respectively. It is significant,
I think, that those with children who were buying less constituted 26.1 per
cent of the total interviewed, and those without children constituted 17.3
per cent.
Acme Farmers Dairy also made a survey on 15 routes. The results, I
think, are of sufficient interest to set it out as follows:
No. Purchased Buy less Buy 2 Buy 3 Buy 4 Buy
cus- more than than 1 quarts quarts quarts pints
tomer 1 quart quart or more or more or more
Wealthy 552 31.8% 68. 2% 7 % 5. 4% 1 . 6% 15. 4%
Moderat^plus 676 26.4 73.6 3.9 2.8 1.1 13.8
Moderate .' 601 19.9 80.1 2.1 1.8 .3 14.5
Low Income 501 15.8 84.2 2.6 1.8 .8 30.3
Small apartments
Low Income 527 19.0 81.0 3.1 2.7 .4 21.4
Total 2,857
The results of these surveys would seem to agree in the main with the
conclusions on milk consumption arrived at by Dr. W. C. Hopper in his
milk consumption surveys conducted prior to the War. These are published
by the Dominion Department of Agriculture.
If these surveys are truly representative, it would indicate that, irrespective
of the health requirements of the lowest income groups, a very substantial
amount of further education work must be conducted among this group
before they will fully realize the necessity of larger milk consumption.
Co-operatives
As to the other suggestion, that Co-operatives be permitted to function
in the distribution end of the milk industry. Section 11 of the Milk Control
Act provides:
"Notwithstanding anything in The Companies Act, or in anv letters
patent of incorporation, or supplementary letters patent, or in anv other
general or special Act contained no person, firm or corporation, shall give
or distribute any fund, refund, rebate, interest or dividend to any pur-
chaser of milk therefrom either directly or indirectly in respect of any
such purchases of milk except such interest or dividend as may be earned
on capital invested by such purchaser in such firm or corporation."
120 ONTARIO ROYAL COMMISSION ON MILK
Obviously this prevents the basic operation of a consumer co-operative which
requires that its profits be shared among its members in proportion to the
patronage they supply. The section of the Milk Control Act referred to was
passed as a result of what is known as the milk war in the City of Hamilton.
It was obviously quite necessary under the theory that a uniform price to
consumers should be fixed by force of law. Apart from this, however, it
would seem to have no justification in logic or common sense. As I have
already indicated, if there is to be a fixed price to consumers obviously
co-operatives in the ordinary sense cannot be permitted. In my view, if
a group of the consuming public desire to organize themselves into a
distributing unit for fluid milk on co-operative principles; and if they have
sufficient capital to comply with the health and sanitary regulations, there
is no reason I can see why they should be precluded from doing so in
connection with such a vital food product as milk. Indeed, it would seem
the part of wisdom to encourage them to do so if they are enterprising
enough to undertake such a venture.
Whether such a venture would be successful, in view of the narrow margin
within which the distributing end of the dairy industry has to operate, is,
of course, another question. I was particularly interested in the evidence
of Mayor Lawrence of the City of Hamilton, who has been a director for
some fifteen years of the Hamilton Co-operative Creameries. It was to
curb the activities of this organization that Section 11 of the Milk Control
Act was passed in the year 1935. Since that time this co-operative, not
being able to declare a patronage dividend, has acted substantially in the
manner of any other privately owned distributor. Mayor Lawrence was
asked if there was anything excessive in the profits which that dairy made
and he said none whatever. He also stated that the profit was very small.
As he put it, there was a rigid ceiling fixed and during quite a lengthy
period the floor had been coming up. Nevertheless, Mayor Lawrence was
of the opinion that the section of the Milk Control Act which effectively
prevents the operation of consumer co-operatives should be deleted. Ta
those who are interested, I would direct attention to Mayor Lawrence's
evidence, particularly under cross-examination by Mr. Sedgwick and Mr.
McLean. It may well be that, under the very narrow margins now obtain-
ing, consumer co-operatives distributing milk in any given market would
not make sufficient profit or obtain a sufficiently large volume to effectively
decrease the cost of milk to the consumer. Nevertheless, if there is a chance
of them doing so, that road should not be closed to the consumer.
Milk as a Public Utility
Coming now to the question of the distribution of milk as a public utility,
most consumer representatives seemed to feel that this would solve their
difficulties. Linfortunately, the problem is not as simple as appeared to these
witnesses. Obviously much depends on the efficiency of the publicly managed
milk distributor and the extent to which competition is allowed by private
enterprise. It did not occur to any of those advocating this scheme of things
that such a public enterprise should be subject to taxation. This may or
may not be desirable. Nevertheless, to the extent that such a publicly
owned enterprise is free from taxation there is, in effect, being paid by the
public at large a direct subsidy for its maintenance. The taxes formerly
paid by private enterprise must now be raised elsewhere if the general level
of public income is to be maintained. In discussing this point one must
presume that no more is raised by way of taxation than is strictly necessary..
ONTARIO ROYAL COMMISSION ON MILK 121
One of the most successful municipally owned dairies in the world is located
in Wellington, New Zealand. It is noteworthy that the Milk Department
of the City of Wellington pays all general taxes in the same way as a
private company would, except income and social security taxes. As far
as I am aware there is not a publicly owned milk distributing body on the
North American continent except a small one in the State of North Carolina.
The New Zealand experiment, which has been highly successful, is most
certainly worthy of study. In consequence of this I have set forth in
Appendix 22 a portion of the report of the Royal Commission appointed
in March 1943 in New Zealand which enquired into the existing circum-
stances of the supply of milk to four metropolitan areas of the Dominion.
This report was presented to the Governor General as late as August 1943.
I have set out in the Appendix the observations covering the supply of milk
to the metropolitan area of Wellington during 1943. Through the courtesy
of the offices of the High Conmiissioner for New Zealand in Canada, the
memorandum which I have appended to this statement of the Royal Com-
mission was furnished by the New Zealand Secretary of External Affairs.
I am advised that the present value of the New Zealand pound in terms of
Canadian dollars is $3.26 for practical purposes. In comparing prices for
milk and dairy products generally in New Zealand with those in Ontario
it must be remembered that the general price levels in the two areas are
different. The buying power of a dollar in New Zealand is definitely greater
than that of a dollar in Ontario. The whole relationship between costs,
wages and prices is on a lower level. Therefore, the price of a quart of
milk in New Zealand cannot be simply expressed as the equivalent of the
value of the New Zealand price expressed in the exchange value of that
sum in Canadian currency. It is, of course, therefore, entirely fallacious
to say that, when milk is produced much more cheaply in New Zealand
where production and labour costs are strikingly lower than they are in
Ontario, it can be produced and sold in Ontario at the New Zealand price.
Nothing could be more misleading.
I have also had the privilege of perusing a report from the Manager of
the Municipal Milk Department of Wellington. It would appear that it
was a number of years before sufficient profits were earned to substantially
reduce the cost to consumers in Wellington. This, I think, is almost certain
to be the situation in Ontario. Public or municipal ownership of milk dis-
tribution cannot be regarded as an immediate panacea for the evils of high
cost milk. It must, at the least, be regarded as a long term solution. In
any case, in my view, it may or it may not be a solution, depending sub-
stantially on the skill of management and on the scope of the operation.
A substantial study of this problem has been made in the United States
by Professor W. M. Mortenson, of the University of Wisconsin. To those
interested, reference may be made to this study published by the University
of Chicago Press. His conclusions would seem to indicate that milk can
best be handled as a public utility where the operation is not too large. The
fact that Wellington, New Zealand, is a moderate sized market would seem
to sustain this view. My opinion would be that, if Public Utility Distribution
will result in more efficient distribution and lower priced milk, municipalities
wishing to embark on this experiment might well be permitted to do so.
As I have said, it is impossible to be dogmatic about the matter. It may
or may not be a solution. The only proof as to whether it is or not must
come from actual experiment. I would suggest, therefore, that permissive
legislation be granted to municipalities desiring to embark on such an enter-
122 ONTARIO ROYAL COMMISSION" ON MILK
prise. It would seem to me, however, that if such an enterprise is permitted
to function in competition with private enterprise, it should not be left in a
position to take advantage of concealed subsidies, such as remissions of
taxation, but should be made liable to the same taxes as a private distributor.
Such an enterprise can, surely, only justify itself if it is financially able
to distribute milk to the consuming public at a lower price.
Summary
Apart from these three suggestions, two of which are admittedly long term
solutions, considering the state of the distributors as a whole there would
appear to be no means of giving cheaper milk to the public immediately. If
the operation of competition in the industry does not bring this result from
those able to make some reduction, then the only immediate method would
appear to be a direct consumer subsidy which, for the reasons stated, I do
not recommend.
Despite the reduction in consumption since the price increases of 1946,
it is worth remembering that the total consumption of fluid milk in the
Province in May 1939 was 20,199,300 quarts, as compared with a total
consumption for May 1947 of 37,874,800. In May 1946 the corresponding
figure was 41,327,600. There is, therefore, an increase as compared with
1939, of 87.55 per cent, and a decrease, as compared with a year ago, before
price increases, of 8.35 per cent. While the increased consumption since
1939 is undoubtedly due to a variety of factors, including in particular
increased consumer purchasing poAver, it is, I think, reasonable to assume
that the educational work done by what is now called The Associated Milk
Foundations has had a very considerable eff^ect. The recent tendency of
these foundations to become established in a larger number of markets may
well assist the consumer to greater realization of the nutritional value of
milk. Admittedly there is still a large field for this, particularly in respect
of low income consumers. Milk is probably one of the cheapest foods avail-
able to consumers, even at present prices. As some one suggested, it is
desirable that consumers should be milk-minded as well as price-minded.
ONTARIO ROYAL COMMISSION ON MILK 123^
CHAPTER X
Cheese Production and the Position
of the Cheese Producers
The producers producing milk for manufacture into cheese are, roughly
speaking, situated generally in far Eastern Counties of Ontario, in the
district centering around Belleville, and in Western Ontario in an area
composed chiefly of the Counties of Oxford, Perth, Middlesex and
Elgin, and areas contiguous thereto. The producers are organized in an
association called The Ontario Cheese Producers' Association, and I was
advised that it had a membership of approximately 25,000 members. This
association was organized in 1934 and prior to that time there was little
co-operative effort among those producing for the cheese factories. The
producers who supply milk to the cheese factories are organized in five
general areas as follows:
District Number 1, consisting of the Counties of Peterborough, Hastings,
Prince Edward and Northumberland;
District Number 2, consisting of the Counties of Lennox and Addington,
Frontenac, Leeds and Lanark;
District Number 3, consisting of the Counties of Glenville, Dundas,
Stormont and Glengarry.
District Number 4, consisting of the Counties of Prescott, Russell, Carlton
and Renfrew;
District Number 5, consisting of the County of York and every County
to the west thereof having a cheese factory.
There are County Cheese Producers' Associations for each of these
districts and the Counties represented in District Number 5 give some
clue to where the cheese production in Western Ontario lies. The As-
sociation is financed by a levy of five cents per hundredweight of cheese
produced, of which 75% is retained by the Provincial Association and
25% is sent to the County Associations. Much more cheese is produced
in Ontario than is consumed in Ontario or in Canada, and I was advised
that about two-thirds of the Cheddar cheese produced in Ontario is
exported, and that actually this export from the Ontario cheese factories,
in its turn, constituted about two-thirds of the total of Cheddar cheese ex-
ported from the whole of Canada. It has largely been exported to the
United Kingdom, where over the years a market for this cheese has
been built up, and I was advised that Ontario Cheddar cheese was rated
in the British market as the finest Cheddar cheese imported into Great
Britain.
Cheese Factories
In respect of the number of factories, the Ontario Cheese Producers'
brief put it at about 600. Mr. S. L. Joss, Secretary of the Association, was
inclined to place it closer to 535. These factories may be divided into two
general classes: First, a relatively small number of factories owned by
large companies such as the Kraft, Borden, Canadian Packers and Swifts,,
to cite only a few, who in number constitute about five per cent of the
124 ONTARIO ROYAL COMMISSION ON MILK
cheese factories in the Province. These factories buy milk from pro-
ducers for cash, and the producer has no further interest in the product.
For the most part they produce what are called processed cheeses, and
I am advised that, insofar as the general problem of the cheese producers
in Ontario is concerned, they do not at the moment greatly affect the
situation. There was some evidence that this might not always be true,
as apparently a number of large processing companies have been buying
up privately-owned cheese factories and operating them for their own
purposes or, in some cases, closing them. It cannot be said, however,
that this process has reached a point where in general it affects or
threatens the general control of producers of cheese milk over the manu-
facture of the bulk of the cheese made in Ontario. In the view of the
cheese producers it is simply a tendency that requires watchful attention.
The greater bulk of factories manufacturing cheese are located close
to their source of supply and manufacture cheese for groups of producers.
Some of them are privately-owned, while others are owned by joint stock
companies. Still others are owned co-operatively by the cheese milk
producers in the adjacent areas. I was told that the joint stock con;-
panies were originally incorporated by groups of producers who financed
the erection of the factories. Their practice now is to charge a fee for
the making of cheese, and in some cases the shareholders are given a
return on their invested capital, either by the payment of a small fixed
dividend or a rebate in the amount charged for cheese manufacture.
It was stated that none of the so-called privately-owned factories in this
group were operated with a view to making substantial profits for theii
members. The charges to the producers for the manufacture of cheese
are estimated generally on a basis of obtaining sufficient profit to provide
for repairs and replacements of the factory and its operation, and to
cover dividends paid to the shareholders.
By far the larger group of factories, however, are co-operatively
owned by the producers themsehes. These factories employ a cheese
maker who employs his own labour. The co-operative owning the factory,
however, pays the taxes and maintenance charges and keeps it in repaii.
There is also another type of factory which is wholly owned and operated
by a cheese maker. He manufactures the cheese for the producers who
bring their milk to him and he makes a charge for this service sufficient
to pay his operation and maintenance costs and to give him some return
for his services. In all of these cases, however, the essential method
of manufacture, as far as the producer is concerned, is the same; that
is, whether the cheese factory is owned by a producer-formed joint
stock company or is co-operatively owned, or is owned by a cheese maker,
the cheese produced in the factory remains the property of the milk pro-
ducer until it is sold on what is called a Cheese Board.
Cheese Boards
Cheese Boards have a long history, but for present purposes are part of
the machinery for the sale of cheese set up under what is called the Cheese
Scheme, which has the effect of law under the provisions of the Farm
Products Marketing Act. When the Dominion Natural Products Marketing
Act of 1934 was passed, as a result of an almost unanimous poll of the
cheese producers, a scheme was set up pursuant to this statute for the
jnarketing of Ontario Cheddar cheese, which superseded previous methods
which included sale of a percentage of the cheese through a co-operative
selling agency with headquarters in Montreal. Subsequently, when this
ONTARIO ROYAL COMMISSION ON MILK 125
Act was declared ultra vires, it was replaced in Ontario by the Farm Products
Control Act, and a similar scheme was set up under this Act. The present
statute, passed in 1946, is the Farm Products Marketing Act, and a new
scheme has been approved under this statute. The Board set up under this
scheme is called the Ontario Cheese Producers' Marketing Board. As
ancillary to this Board there was incorporated a private company which is
known as the Ontario Cheese Producers' Association Limited. The directors
and share-holders of this Company are the members of the Ontario Cheese
Producers' Marketing Board, and the idea at the time it was incorporated
in 1938 was to use this Company as a marketing agency. The operation of
this Company will be discussed later, but it has not been notably successful
to date in affecting the general situation. Undoubtedly wartime conditions
have been partly responsible for the lack of progress made.
Apart from wartime controls and special contracts, cheese is generally
marketed through what are called Cheese Boards or local auction markets,
which operate under the Ontario Cheese Producers' Marketing Board. The
officers of these local Cheese Boards are elected by the County Producers'
Associations, and they are constituted where it is most convenient for the
purpose of selling cheese. They are not necessarily confined to one county
or one district. They have no permanent quarters, but meet in whatever
convenient premises may be available. During the cheese-producing season
Board sales are held at convenient intervals, varying from one week to one
)nonth. At the sale, I am advised, the procedure is to mark on a blackboard
the cheese to be sold, giving the quantity, quality, size and type which each
factory is offering for sale. Buyers present then bid by auction for any
part of the cheese by factories, and the price offered is noted on the black-
board. At the end of the bidding the salesman representing the cheese
factory may refuse to accept the highest bid offered, and in that event the
cheese goes back to the factory to be put up for sale at a subsequent
Board. If, however, the salesman acting on behalf of a particular factory
accepts a bid, the sale is noted on the blackboard and this is held to con-
stitute a contract of sale, a record of which is kept by the secretary of that
particular Board. While Cheese Boards operated for many years prior to
1934, the percentage of cheese sold on the Boards declined steadily until
it constituted only about 20 per cent of the total production. It was because
of this situation that the 1935 Cheese Marketing Scheme and the subsequent
schemes were inaugurated and it was made compulsory for the factories to
sell through Cheese Boards. The evidence before me indicates that this
has produced a greater uniformity in prices, and that the system, generally
speaking, is satisfactory to producers.
After the outbreak of war and up to the spring of 1947 the prices for
cheese were controlled as part of the over-all control of the Wartime Prices
and Trade Board, and consequently an artificial price structure was created
which was designed to produce the necessary supply irrespective of the
cost of production, and which was activated by considerations which would
normally not govern tlie price structure of the cheese market. When price
control was made generally applicable in 1941, the first ceiling price
established for Cheddar cheese for the domestic market was 24 cents per
pound for first grade cheese f.o.b. factory shipping point, with appropriate
reduction for lower grades. These prices were subsequently slightly re-
duced. In addition, as part of the war effort, a large amount of cheese was
requisitioned from time to time for export to Great Britain. The price for
export cheese at that time, 1941, was 20 cents per pound, which included
a subsidy from the Ontario Government of two cents per pound paid under
126 ONTARIO ROYAL COMMISSION ON MILK
the provisions of the Ontario Cheese and Hog Subsidy Act of 1941. This
price was very considerably higher than that which apphed in connection
with the first export contracts. The first contract, which ran from May,
1940, to the end of March, 1941, arranged for a price of 14 cents. To this,
however, a Dominion subsidy of .6 cents a pound was added in January,
1941. In May, 1941, this subsidy was increased to 1.6 cents a pound, thus
bringing the total amount received to 16 cents a pound. To this price of
16 cents there was added an Ontario subsidy of two cents a pound and a
Dominion quality premium of two cents a pound for cheese scoring 94
points or better. Thus, the total price on first quality cheese after May,
1941, was 20 cents a pound f.o.b. Montreal basis. This system was main-
tained until October, 1946, and at the time of the hearings before me the
disposition of cheese was still governed by specific orders of the Wartime
Prices and Trade Board, and a large part of cheese held in Ontario was
subject to disposition by the Administrator of Dairy Products. A great
deal of the evidence before me was directed to a demonstartion of the
position taken by the cheese producers that the prices realized by them
under these ceilings were insufficient to pay for their costs of production.
At the present time, however, price ceilings on cheese have been removed,
and the only controls left which in effect still govern the price received
for cheese is the existence of the British contract and the prohibition of
export to areas other than Great Britain and, I believe, the West Indies.
Consequently, at the present time, as a necessary aftermath of the war, any
other export markets are closed to the cheese producers of Ontario. It was
suggested before me that possibly token shipments might be permitted to
maintain the knowledge and reputation of Ontario Cheddar cheese in
American markets, but these to date have not been permitted. It is ob-
viously not within the ambit of the matters referred to me to comment on
this policy, either favourably or adversely.
Insofar as costs of production are concerned, this matter has already been
very thoroughly discussed in the chapter dealing with producers of fluid milk.
In large measure the same considerations apply to those producing milk
for cheese purposes. In the over-all survey made bv the Accountants
attached to the Commission, an attempt was made to calculate the cost
of producing milk for cheese. This is set out as follows:
AVERAGE COST OF PRODUCING 100 POUNDS OF MILK FOR
MANUFACTURING CHEESE IN ONTARIO IN 1946
Concentrates S .65
Hay 46
Silage .23
Pasture .28
TOTAL FEED COSTS SI. 62
Dairy Herd Labour 1.00
Depreciation .11
Hauling .10
Miscellaneous .35
GROSS COST S3. 18
ONTARIO ROYAL COMMISSION ON MILK 127
CREDITS :
Milk used on farm ., $ .21
Manure .24
Cattle sales less cattle purchases
and inventory adjustments .39
TOTAL CREDITS .84
AVERAGE NET COST $2.34
ADMINISTRATION ALLOWANCE .35
TOTAL COST INCLUDING ADMINISTRA-
TION ALLOWANCE $2.69
It will be seen that, apart from any administration allowance, it works out
on the general average to $2.34 per hundredweight of milk. If administra-
tion allowance is made of 35 cents per hundredweight, the cost figure is
$2.69. This, of course, is a general average figure. At the time of the
enquiry before me, the return to the cheese milk producer was estimated
at between $1.95 and $2.10 plus the value, which seemed rather doubtful
in many cases, of whey returned for each 100 pounds of milk. If the average
figure is one of general application, as I believe it is, it would seem to
substantiate the contention brought forward by the Cheese Producers'
Association that the price structure existing at that time did not permit a
return to the farmer sufficient to pay for his cost of production and give
him even a modest profit. As is true of other producers, there is great
variation in the costs as between individuals who produce milk for cheese.
It must be remembered that the figures I have quoted are averages for the
whole Province.
There is also a difference in the way milk is produced for cheese between
Eastern and Western Ontario. In Eastern Ontario, apart from the Cities
of Ottawa and Kingston, there are no large markets for fluid milk, and there
is consequently a much greater production of milk for cheese and con-
densary purposes. In Eastern Ontario this is largely a seasonal production.
The practice is to have cows freshen in the spring and dry up in the fall.
It was stated before me that the annual fluid production per cow on an
efficient farm in Eastern Ontario would probably be about 6,000 pounds.
In Western Ontario production is maintained over the year, including the
winter months. Admittedly this increases costs, but also increases quantity,
and there, I was told, on the average the annual production per cow would
be about 8,000 pounds of milk per year. One witness had cows producing
as much as 12,000 and 13,000 pounds of milk per year. He. however,
would, I believe, be greatly above the average producer in Oxford Countv.
The price ultimately realized for the cheese, of course, is not related to this
distinction. Any additional profit must come out of the additional quantity
of cheese produced.
By and large the producers have not maintained control over their product
beyond the point of manufacture. I am told that the machinerv for exporting
cheese to the British market largely centres in the City of Montreal, and
IS operated by a Canadian firm and a British firm who have built up their
128 ONTARIO ROYAL COMMISSION ON MILK
businesses over a long period of time. Consequently the price realized by
the producer of cheese milk is settled Avhen his cheese is sold at a Cheese
Board. While it was represented to me that Ontario Cheddar cheese was
looked upon in Great Britain as a high grade article and was in effect in
the class of luxury goods, any bonus accruing from this only accrues to a
producer of cheese milk if it is represented in the price he obtains at a
sale at a Cheese Board. As yet he has no effective control over the disposition
of the cheese on the British market. It was, of course, to obtain some such
control that the limited company which operates with the Ontario Cheese
Producers' Marketing Board was set up, that is, the Ontario Cheese Pro-
ducers' Association Limited. Its operations, however, have been on a ver}'
small scale partly, I am advised, through lack of capital. The following
table sets out its purchases and sales from 1938 down to 1947:
ONTARIO CHEESE PRODUCERS' ASSOCIATION,
BELLEVILLE, ONTARIO
VOLUME OF CHEESE PURCHASES AND SALES
1938 to 1946 inclusive
Purchases
Sales
Pounds
1938
1939
$31,000.00
69.000.00
$34,000.00
73.000.00
213,000
485,000
1940
82,000.00
87,500.00
500,000
1941
1942
1943
79,000.00
Not operating
Not operating
94,000.00
525,000
1944
1945
1946
107.000.00
Not operating
Not operating
118.000.00
600.000
1947
950,000.00
900,000.00
4,800,000
(Spring purchasing
season)
(Sales reported
to date)
It is obvious that a much larger operation has been undertaken in 1947
with the revocation of most of the wartime controls. Neverthless, this Com-
pany, while it may occasionally have operated as a competitive factor in the
domestic market, has not operated to an extent which would enable it to
exercise any very effective influence on the price obtained at various Cheese
Boards. I am told that the majority of the cheese producers are not willing
to wait the length of time for their returns which would be required if this
Company were to operate in a more substantial and more direct way on the
British market. If this is the case, then, of course, the producers have very
little ground for complaint. In mv view the remedy lies entirely in their
own hands, and it mav be that until they are prepared to extend the opera-
tion of this marketing company to Great Britain, and, in effect, see if thev
can sell Ontario Cheddar cheese on the British market as a luxury product
at a price commensurate with that sort of goods, the producers of cheese
milk in Ontario have no proper cause for complaint. If they are not willing
to take independent steps to insure that the prices received are truly com-
petitive, they must accept the prices paid by the export firms alrady
handling the business. I am told that the export firms functioning in Canada
do not show any unusual or large scale profits. I have no information,
however, nor have I been able to obtain anv, as to the profits earned by their
principals in Britain, and I do not know whether thev are inordinate or not.
It would seem obvious, however, that until the producers are prepared to
ONTARIO ROYAL COMMISSION ON MILK 129
test the matter out further, very little can be said as to the adequacy of the
prices obtained.
While premiums, which will be discussed later, are paid for high quality
cheese by the Dominion Government pursuant to the Dominion Cheese and
Cheese Factory Improvement Act, it is obvious, I think, that if Ontario
Cheddar cheese is to be sold as a high grade luxury product there must be
a continuous and persistent effort to further improve quality.
It would appear from the evidence and from what I have been advised,
that in many cases cheese factories in Ontario would benefit greatly by
consolidation and modernization. By the Cheese and Cheese Factory Im-
provement Act, Chapter 13, Statutes of Canada, 1939, as amended in 1940,
the Governor-in-Council may grant out of monies appropriated by Parlia-
ment for the purpose a sum not exceeding 50 per cent of the amount
actually spent for new materials, new equipment and labour, utilized in
constructing, reconstructing and equipping cheese factories, subject to cer-
tain further provisions as to cheese ripening rooms, proper insulation and
refrigeration; and provided that such new factories replace two or more
existing cheese factories.
Consolidation of Cheese Factories
In a notable address delivered by Dr. G. S. H. Barton. Deputy Minister
of Agriculture for the Dominion to the Ontario Cheese Producers' As-
sociation in January of this year, he pointed out that from 1939 down to
the beginning of 1947 in the Province of Quebec some 48 new amalga-
mated cheese factories were constructed pursuant to this Act, and that
these new factories replaced 105 original factories. Forty of these
factories were constructed as combined cheese and butter factories at an
average cost of $12,451.88. The average subsidies paid on account of all
amalgamated cheese factories in Quebec was S7, 100.81, and the average cost
worked out to $14,201.62. As I have noted above, Dr. Barton stated
that 48 amalgamations had taken place, and at the time of his address
in January, 1947, four more were under way. As compared with this,
only two amalgamated cheese factories replacing four original cheese
factories were constructed in the Province of Ontario. Neither of these
new factories was constructed or equipped for the manufacture of any
product other than cheese. The average cost of these factories was
$13,173.88, and the average subsidy paid was $6,586.94. He stated
that two amalgamations had been completed in Ontario: that six were
under way at the time of speaking; and that in all only eight had taken
place. It would appear that the cheese milk producers of the Province
of Quebec realize their problem and are much more progressive in their
attitude towards it than those in Ontario. It is recommended that
the Ontario cheese producers should consider their condition and take
advantage of this public assistance, as it undoubtedly assists in pro-
ducing a much better quality of product.
It may be asked why such stress is laid on the necessity of amalga-
mation of cheese factories. While amalgamation of the smaller existing
plants is most desirable from the standpoint of greater uniformity and
improvement in the quality of the product, it should also be noted that
amalgamation is also desirable in that it paves the way to lower cost of
cheese manufacture. A survey of cheese manufacturing conditions in the
Province as they existed in 1933 was made by the Economics Division
of the Dominion Department of Agriculture. The results of this surve\ ,
which would appear to be equally valid to-day, indicated very clearly
130 ONTARIO ROYAL COMMISSION ON MILK
that the cost of hauling milk from the farms to the factory declined with
each increase in size of factory. The more the volume per factory
increased, the more was collective hauling substituted for individual
hauling; ,and the larger was the volume of milk handled by each unit
of hauling equipment. The decrease in cost resulting from more efficient
use of hauling equipment was greater than any increase in cost resulting
from lengthening the milk route. From this it would appear that a very
considerable increase in the average size of factory is required before
real efficiency in the use of hauling equipment can be brought about. By
increasing the volume of milk going to each factory, not only is a re-
duction in the cost of milk hauling effected but there is a reduction in the
cost of manufacturing the milk into cheese. It would appear that the
main cause of high manufacturing cost is insufficient volume of business.
The main hope of making worthwhile cost reductions in the processing
cost lies in making substantial increases in the output per factory. Where
the average volume per factory is relatively small, as in many parts oi
Eastern and Central Ontario, there is very definite room for considerable
amalgamation. Jn these areas the small average volume suggests the need
for amalgamation, while the fact that plants are close together indicates the
possibility of it. To repeat, any possible increases in volume resulting
from amalgamation would reduce the cost, both of milk hauling and of
cheese making.
It is also worth noting that there is a definite connection between
the lowering of manufacturing cost and the lowering of farm production
costs. It is obvious that a larger amount of milk per cow and per farm
probably results in lower production costs. The more farm costs are
reduced in this way, the larger is the volume of milk from a given area.
The larger the volume of milk, the lower will be the cost of transporting
it and manufacturing it into cheese. As more milk is available there will
be full load and full use of plant capacity. By reducing the farm pro-
duction costs, therefore, by increased volume farmers are contributing
to a reduction in the expenses of manufacture.
To the extent that amalgamation of factories actually occurs, the
question as to the length of operating season is likely to become more
important. It is obvious that an up-to-date larger-scale factory involves
considerable in the way of overhead investment, and that efficiency in
processing will require reasonably complete use of the plant over the
whole year. On the other hand, in order that the factories may be
more fully used, it will be necessary to have cheese producers continue
supplying milk for a longer period of the year. As has been previously
noted, this would involve considerable increase in production costs. The
proper balancing of these two sets of costs is a problem which the cheese
producers, particularly those in Eastern and Central Ontario, will have to
most seriously consider in the future as amalgamation proceeds.
The importance of the foregoing will be realized when it is appreciated
that the over-all price for cheese is inevitably determined by the price
obtained for the exportable surplus. No matter what the cost of pro-
duction in Ontario is, what the farmer gets for the milk he produces
for cheese is determined finally by the price paid for cheese by those
exporting it to outside markets. Unless the farmer can improve that
price by improving quality, or can widen the spread between his cost
of production and the price obtained for his cheese when sold for export,
there is no way that I can see by which he can improve his income
from the production of cheese milk. High quality, cheapness of production
ONTARIO ROYAL COMMISSION ON MILK 131
and more efficient marketing must be the goals towards which the cheese
producer's attention are constantly directed.
Summary
I do not think that I should conclude these observations without quoting
a short passage from Dr. Barton's speech to which I have previously
alluded: As he said:
"In the manufacture of cheese we have made substantial improve-
ment in the quality of the product in recent years but we still have
too large a proportion of our cheese which fails to meet requirements.
We have improved the storage facilities in a large number of factories
but we have stagnation, particularly in Ontario, in the character of
the factories themselves. We have too many small factories, too many
of them uneconomic units and inefficiently operated. There is only
one solution for this condition and that is new factories on a consoli-
dated basis wherever that is practicable. That is the logical means to
make economic manufacture possible, to afford opportunity for first-
class service, and to eliminate many of the present weaknesses. I believe,
also that in such consolidation the possibilities of combination factories
should be carefully examined and in many cases provision made in the
plans for facilities through which diversion of milk to other purposes
may be undertaken when such action seems desirable. This would
add to the value of the investment, it would give the business flexibility,
and it would provide security against absorption by any monopoly interest
for a special purpose."
Something w^as made in the evidence before me of the differential in
the cost of production between milk for the fluid milk market and milk
for the manufacture of cheese. In view of what has been stated as to the
conditions under which Ontario Ched^lar cheese is produced and sold,
a discussion of any differential of this sort would appear to lead nowhere
as the factors which determine the return to the cheese milk producer
are not directly related to his cost of production or to those governing
other types of milk producers.
It is obvious that at the present time the return to producers of cheese
milk is influenced to a large degree by the existing contracts with Britain.
It was urged before me that if the producers in Ontario were given a free
hand in the marketing of their product, they might obtain higher prices
than those obtaining under the British contract. It should be remem-
bered, however, that the British market has been the market which over
the years has absorbed most of our surplus Cheddar cheese. If anything
approaching a fair price is now being obtained, and it is I think impossible
to say that the present price is unfair, it would seem to be good business
for the producers of cheese milk in Ontario to take a price which now
will in effect maintain and protect the market established in Britain over
so many years. While it might seem reasonable to permit token shipments
to other markets to keep Ontario Cheddar cheese before the consumers
in those markets, nevertheless it must be the part of wisdom not to
destroy the one substantial market which has already been developed
by demanding at a time of crisis prices which are essentially out of line
with those prices which would be obtained under more normal conditions.
A final word should perhaps be said in regard to the important place
which the production and price of cheese plays in relation to the entire
■dairy structure. Even though the percentage of milk going into cheese
132 ONTARIO ROYAL COMMISSION ON MILK
is but a fifth to a quarter of the total produced, it is the price received
for milk at the cheese factory that tends to determine the whole dairy
price structure. If the cheese price fails, milk tends to be shifted from
the cheese factory to the creamery or condensary. Such supply increases
tend to cause a drop in butter-fat and condensary prices. If and when
this happens, there is sure to be an attempt to break into whole milk
markets. Thus unsatisfactory cheese prices tend to bring about un-
certain dairy prices in general. It would, therefore, seem apparent
that there is a very real responsibility on all those connected with the
production and marketing of cheese in Ontario towards the whole dairy
industry in the Province. This may well be a factor which might lead
other branches of the industry to seriously consider the suggestions
made before me for the pooling and marketing of all milk produced in
the Province through an over-all marketing organization.
Mr. Entwistle has made a studv of the position of the cheese pro-
ducers and cheese factories. Comment has alreadv been made on certain
aspects of this study without direct reference. It is set forth in full in
Appendix 29.
ONTARIO ROYAL COMMISSION ON MILK 133
CHAPTER XI
Cream Producers, Creameries
and Butter Production
Cream Producers
The Ontario Cream Producers' Association, organized in 1946, presented
a brief to this Commission and gave evidence before me. It would appear
that upwards of 76,000 farmers in this Province ship cream to creameries
for manufacture into butter. The flow is not uniform, in that there is no
quota to be met and hence natural variations in production are reflected
in the deliveries of cream.
Wtih very few exceptions cream is a by-product on these farms, in that
the herds of cattle kept are not dairy cattle but beef cattle or dual-purpose
cattle, with low milk production, as compared with cattle used for the fluid
milk supply.
As a matter of fact, the collection and sale of cream in many cases repre-
sents the extra labour of a farmer's wife, by which she receives a cash
income to assist her in managing her home.
Notwithstanding the fact that cream production is essentially a side-line
to other types of farming, Ontario is a very large producer of cream and
butter, in the aggregate, and until rationing during the war years enjoyed
a per capita consumption of 32 pounds of butter per year, which was higher
than any other community in the world.
This enormous consumption could not be supplied by the domestic cream-
eries, although approximately 30 per cent of all milk produced is used for
butter-making, and this Province has been an importer of butter since 1915,
the bulk of our requirements over and above Ontario production coming
from the Prairie Provinces.
Efforts were made by representative cream producers to give an estimate
of the cost of producing milk for skimming and producing cream for butter.
In the brief of the Producers' Association filed, it was estimated that the
cost would be in the vicinity of $2.54 per 100 pounds of milk testing 3.4
per cent butter-fat. This, converted to a price to the producer per pound of
butter-fat, would be 74 cents per pound. As a rule five pounds of butter
are recovered from four pounds of butter-fat, and since the spread to the
creamery under the present price structure, as estimated by Mr. Entwistle,
is approximately l^-ic, a price of 74 cents per pound butter-fat to the
producer means a price of 67 cents per pound of butter to the consumer.
In evidence before me, however, it was admitted that it was a very diffi-
cult matter to estimate cost of production so far as cream was concerned.
It must be obvious that one would have to take into consideration the whole
farm operation and try to allocate a fair proportion of costs and returns
to the cream production. Without a detailed study of many farms over a
period of years it would not, in my opinion, be possible to get any estimate
worthy of consideration.
Generally speaking, I subscribe to the view of the cream producers that
each product should stand on its own feet and that the producer should
receive at least his cost of production where such is the result of efficient
134 ONTARIO ROYAL COMMISSION ON MILK
operation for each necessary product. At the present moment, however,
it is not possible for me to say whether or not, on the average, a producer
is getting his cost of production for cream. Prior to May 1st, 1947, the
producer received 40 to 42 cents per pound butter-fat from the creamery
and 10 cents per pound butter-fat by way of federal subsidy. Since that
date the subsidy has been cancelled, and price ceilings removed, so that he
is now receiving approximately 51 ^^ cents per pound butter-fat all paid by
the consumer.
There are other provinces in Canada with substantial exportable surpluses
and other countries as far away as New Zealand, who are ready and willing
to ship butter into Ontario for this price and some times at a much lower
price. The Ontario cream producer, in my opinion, must be subject to these
factors and cannot expect to receive a higher price than that prevailing in
the export market.
It seems to follow, therefore, that if the cream producer is to improve
his position he must,
(a) Improve the quality of his product to insure the highest prevailing^
price;
(b) Improve his methods of production to reduce cost;
(c) Eliminate waste and duplication in transporting the cream;
(d) Do what he can to eliminate wasteful methods and unused plant
capacity in the creamery; and
(e) Take steps to insure that he gets the maximum competitive price
for his butter-fat.
Before dealing with these five points, it should be drawn to attention that,
regardless of the price of butter-fat, there is bound to be a substantial pro-
duction of cream available for churning. Apart from those farmers essen-
tially engaged in raising cattle for beef, which must of necessity produce
quantities of cream, skim milk is such an essential feed factor in poultry
and hog raising that cream must be produced.
Nevertheless, there is a wide-spread belief held by cream producers that,
prior to recent price increases in butter, the cream producers received pro-
portionately less for each 100 lbs. of milk produced than producers of milk
for fluid consumption, cheese and manufactured milk products. It may be
that this belief, although difficult to justify, has been a factor in the decline
in butter production in Ontario which is shown later in this chapter.
It may be expected that during periods when the price of butter-fat is
depressed, the amount of cream reaching the market for butter may
decline, but if the market for hogs and poultry is at a reasonable level,
this would tend to prevent a reduction in the volume of cream produced
and available.
It should further be remembered that, while Federal tariff-policy may
afford protection to the Ontario cream producer by excluding low-priced
butter from other countries with a large exportable surplus, the Province
of Ontario has no power to exclude the produce of other Provinces of
the Dominion, and there is certainly a limit to what the consumer can
be called on to pay to protect the farmer.
Quality of Product
Cream is graded by Sec. 15 (2) (a) of the Regulations filed under
the Dairy Products Act (Ontario) 1938 Cap. 7. The basic grade is
"First Grade Cream" and of course the price for this grade depends on
ONTARIO ROYAL COMMISSION ON MILK 135
the price received for wholesale creamery butter. '"Special Grade'"
Cream, as defined, provides for a premium of one cent per pound
butter-fat over "First Grade." "Second Grade" Cream is to be paid
for at a rate of three cents or more below "First Grade." No other cream
shall be used for butter-making.
W. J. Wood, Esq., of AUiston, Ontario, President of the newly-formed
Cream Producers' Association, had this to say in evidence before me
(Vol. 38, pp. 5113-5114) :
"I think to-day that cream is being produced in a great many in-
stances which is not really up to the quality it should be, having regard
to the care taken in producing it. To-day during the winter months,
when men are milking four or five cows and they have to separate thai
milk, the separator should be kept in a warm place. Many farmers
have not all the facilities they need, and as a consequence they bring
that separator just as far into the barn as they can, or into the cow-
stable, and some of them even separate it right in the cow stable — even
the separator is stored among the odours of feed and from the cows
— and it cannot be of the best quality. That is one of the things which
is going to help the farmer — that is when we get inspection — to improve
the quality of the butter."
At the present time there are no standards set for cream producers
with respect to sanitary conditions, and apparently the price differential
of four or more cents per pound between Special Grade Cream and Second
Grade has not been a great enough spur to ensure real effort by many
producers to get the top price.
It is encouraging to see the officers of the new Association recognizing
this and taking steps to help their members to improve methods of pro-
duction to get a greater return for their work.
Methods of Production
Since cream production is essentially a side-line business, the same
care and study has not been devoted to production as in the case of many
whole milk producers. It seems beyond doubt that many cream pro-
ducers can so increase their volume of production by improved and
modern methods as to materially lower their present unit cost, and again
the Cream Producers' Association, in conjunction with the Dairy Branch
of the Ontario Department of Agriculture, should be of great assistance
in achieving this end.
Waste in Transportation
On the average, a cream producer in Ontario will ship his product to a
creamery eighty times annually— or once every four or five days, the
producer paying the cost of transportation as one of his production
costs. Cream transportation has always been notoriously wasteful. in
March of 1944, the Services Administration of the W.P.T.B. reported that
m Ontario, on the average six cream collections were being made simul-
taneously in every cream producing township except the far north, and
m one township there were fourteen simultaneous collections and in
another, in addition to trucks operated by a creamery, 29 other cream
collecting trucks were operating.
In 1938, Mr. Alex Stewart, M.A., of the Ontario Agricultural College,
made a survey entitled "Economic Factors in Cream Collection in Ontario,"
and I quote the following passage from his study:
136 ONTARIO ROYAL COMMISSION ON MILK
"Since the cost of collecting cream makes up some 40 per cent of the
total cost of manufacturing butter, any method of reducing this cost
should mean a worthwhile saving to the farmer.
"In the Township of McGillivray (Middlesex County) 11 creameries
were collecting cream in the spring of 1938. After allowing one truck
on each road, there remained an estimated duplicate or waste mileage of
218 miles every time the cream of the Township was collected. On the
basis of 80 collections made per creamery per year, this Township
would show an estimated waste of approximately 17,500 miles per year
due to overlapping in collection."
That the conditions described as existing in 1938 and 1944 are still
unchanged is borne out by the evidence of officers of the Cream Producers'
Association before this Commission. One of them had this to say:
"For a long time there has been quite a feeling that we have had
considerable duplication in the collection of cream. It is felt that through
some intelligent organization and intelligent understanding between the
operators and the producers, perhaps some material savings could be
made. You cannot attend a meeting of cream producers but that they
protest about the number of cream trucks which travel down the road.
They will, also, have to recognize that they are partly to blame since
they patronize different creameries. There will have to be understandings
both ways."
(Quoted from evidence of V. S. Milburn, Vol. 38, pp. 5098-5099.)
The producers individually and collectively must realize that they have
no right to preserve this wasteful and costly duplication in order to satisfy
their uncontrolled preferences and prejudices with respect to the creameries
they choose to patronize, and at the same time claim high transportation
costs as a part of production expense to be recovered from the consumer.
I think the officers of the Association are well aware of their responsibilities,
and it may be that the new Association will be able to accomplish much in
eliminating this evil. Anything they are able to do will tend to correct the
disparity between the price of fluid milk and the price of milk for cream
and butter.
In some markets much of the cream is brought to the creamery by the
producer. This is particularly true where the creamery is located in a
good urban market city, e.g. London. The farmer combines a trip to town
for various purposes, with the delivery of cream, and this of course means
a very modest amount is to be charged to cream transportation. In addition
it has been found that the cream usually arrives in better condition and
consequently secures a higher grading than if it arrived by independent
transport.
The second most satisfactory method of transportation has been by
creamery-owned vehicles. Here there has been definite rationalization of
routes with lowered costs resulting.
The least satisfactory has been by collecting stations where large
creameries such as Swifts, Canada Packers, etc., accumulate large quantities
of cream for uUimate shipment to processing plant. It is clear from studies
made that the quality of the cream deteriorates in direct ratio to the length
of time it is in transit, and hence the cream sent via collecting stations has
the poorest chance of securing a first-grade and little, if any, chance of a
Special Grade. Certain facilities, however, that the large creamery, operating
through a collecting station which is frequently a country store, offer to
the producer, attract producers to this type of transportation.
ONTARIO ROYAL COMMISSION ON MILK 137
Waste Creamery Capacity
This factor will be dealt with in the section headed "Creameries".
Insuring Maximum Competitive Price
The Cream Producers' Association is at the present time taking steps to
formulate a marketing scheme under the Farm Products Marketing Act. 1946
(Ontario!. Under this scheme marketing of cream would be done by a
negotiating committee, whose responsibility would be to settle agreements
for minimum prices, forms of contract, conditions of sale, weighing and
testing, transportation and other related matters. The scheme also contem-
plates local boards being set up in the various cream producing regions
of the Province to assist in implementing the marketing plans. While the
successful operation of such a scheme must yet be demonstrated, I feel
that this organization may be able to do a considerable amount to assist the
farmer in recovering the maximum possible share of the consumer dollar and
perhaps, by exercising a certain amount of discipline over its individual
members and reducing the number of bargaining agents, bring about many
of the needed reforms in the marketing of this product.
It should be pointed out that cream, unlike fluid milk, may be susceptible
to a marketing scheme under the Farm Products Marketing Act, in that it
does not require daily delivery to the processing plant. Ordinarily it may
wait four to five days and still be Special Grade sweet cream, — and even
sour cream will make good butter. Thus local boards are not pressed for
time in the same way that a local board attempting to market extremely
perishable fluid milk would be.
In the interests of the producer, it is my view that the proposed marketing
scheme should be given full support and encouragement, so that the Pro-
ducers' Association itself may find methods of eliminating the waste and
loss resulting from present out-of-date and inefficient methods of production
and marketing.
In addition to possible benefits under this scheme, it is well to remember
that the successful operation of a larger number of co-operative creameries
would do much to ensure recovery of the maximum competitive price.
2. Creameries
The Ontario Creamery Association, organized in 1917, is an unincor-
porated Trade Association, having in its membership 200, or 78.93% of
the 279 creameries licensed to do business in the Province of Ontario in
1945. The members of the Association produced 87.38% of the creamery
butter produced in the Province in 1945. Representatives of this Associa-
tion filed a brief for my assistance and gave oral evidence before the
Commission, and I am satisfied that they were in a position to properly
represent this branch of the dairy industry. In addition, financial state-
ments and detailed questionnaires were received from creameries generally,
and an analysis of their financial positions with respect to cost and profit
has been made by Mr. Entwistle. His full report is attached as Appendix 23.
There are three headings under which I wish to discuss the position of
the creameries:
(al Plant capacity, Volume of Production and Consolidation.
(b) Single and Multiple Operations.
(c) Cost and Profit Position.
While there are other headings which might be of interest, such as
grading, sanitary standards, licensing and checking, 1 feel that there is no-
138 ONTARIO ROYAL COMMISSION ON MILK
major deficiency in the administration of these matters by the Dairy Branch
of the Ontario Department of Agricukure. I had the benefit of a brief and
evidence from Mr. H. E. Lackner, Director of this Branch, and there can
be no doubt that creamery butter produced in Ontario and sold by standard
grades is an excellent product and merits the full confidence of the consumer.
(a) Plant Capacity, Volume of Production and Consolidation
(i) Plant Capacity and Volume of Production
As stated before, the production of creamery butter in Ontario has steadily
declined since 1939. This is significant, not only because of the effect on
the Ontario producer, processor and consumer, but also because the same
trend has not been true of Canada as a whole. The comparative figures
are as follows:
TotM Annual Production of Creamery Butter 1939-1946 Inclusive
Ontario Canada
lbs. lbs.
1939 88.010,276 267.612,546
1940 87.278,149 264.723.669
1941 86.242.850 285.848,196
1942 81.025.298 284,591.372
1943 82,023.800 311,709,476
1944 75.074.100 298,777,300
1945 77,630.000 293,811.000
1946 68,954,000 271,366,000
Thus, while Ontario production in 1946 was only 78.3% of 1939 produc-
tion, Canadian production in 1946 was 101.03% of 1939 production.
In the same period the number of producers of cream for churning in
Ontario declined from a high of 90,000 in 1939 to approximately 76,000 in
1946. and the number of licensed creameries in Ontario declined from 337
to 286. The decline in the number of creameries has been caused by small
marginal plants going out of business, particularly in Eastern Ontario, and
to the extent that the available cream supply has been directed to other
creameries represents a worth-while consolidation. Unfortunately the decline
in the number of creameries has been exceeded proportionately by the decline
in cream production.
Studies made by the Commission Accountant indicate that at present,
Ontario creameries are on the average operating at less than capacity, and
in some cases as much as 50 per cent below full operation. Others, however,
are operating at full capacity. 48 hours a week, all year round. It has not
been possible to estimate the actual loss in capacity of production by plants,
but whatever it is, it represents a dead loss, in overhead, which must be
absorbed in ultimate cost of production.
Similarly, volume of production, as shown by the Accountant's report, is
of the utmost importance in keeping unit cost to the lowest possible level.
How unfavourably Ontario compares with other provinces in this respect,
will be seen from the following figures:
Approximate Average Production, in lbs., per Creamery in 1946
Ontario 240.000 lbs.
Saskatchewan 780.000 lbs.
Alberta 410.000 lbs.
Manitoba 455.000 lbs.
ONTARIO ROYAL COMMISSION ON MILK 139
It must be obvious that Ontario is suflfering from too many small plants,
each duplicating building and administrative overhead costs, and that steps
must be taken to stimulate production to the point of maximum use of plants
and, wherever possible, to encourage consolidation of plants with a view to
substantially increasing the average production per plant.
Attention is directed to the comparison of net profits to creameries, having
regard to the volume of their sales, as set out in Exhibit "B" to the
Accountant's report. It may be thought that the fact that net profit per-
centages appear to decline as volume of sales increase, is evidence against
the economy of large-scale operation. This is not the case, however, since it
is cost of processing per unit that is important. Every study made of this
aspect confirms my view that as volume of production increases cost per
unit decreases.
(ii) Consolidation
Reference has been made to consolidation of plants as being a desirable
policy in order to reduce unit cost of processing. In this connection I have
quoted elsewhere from an address of Dr. G. H. S. Barton, Deputy Minister
of the Dominion Department of Agriculture made to the annual meeting of
the Ontario Cheese Producers' Association in Toronto on the 7th January,
1947. Dr. Barton's remarks apply with equal force to creameries, and it
should be pointed out that not a single application has been made in the
Province of Ontario for financial assistance under the Provincial Consoli-
dated Cheese Factories Act. R.S.O. 1937 Cap. 87. although generous financial
assistance is available to milk producers "who desire to erect a modern dairv
plant to take the place of two or moie smaller ones." It is realized that this
Act is primarily applicable to cheese factories, but it is suggested that without
amendment it is equally applicable to combined cheese factories and cream-
eries, and with minor amendments to creameries only. The initiative should
be taken by the Ontario Cream Producers' Association, either alone or in
conjunction Avith the Ontario Cheese Producers' Association, to take full
advantage of this legislation.
(h) Single and Multiple Operations
Five out of every six creameries in Ontario have a second or more lines
of business which include the followins. in order of importance: esgs.
poultry, fluid milk, whev butter, ice-cream, cheese, condensed or powdered
milk or buttermilk and sweet cream.
Repeated studies of this problem in every major dairv country in the
world have emphasized the importance of diversification of enterprise in
order to reduce unit costs to the lowest level and to take advantage of
fluctuations in market conditions.
The Commission Accountant, whose full report on this matter has already
been referred to. estimates the average rate of profit of those concerns
engaged exclusively in the production and sale of butter, at 1.26% of sales,
and the average rate of profit of concerns with a diversified business at
1.97% of sales. In other Avords. the diversified enterprise is employing
diversification as a substitute for volume, to reduce unit costs of processing
and handling to the lowest level.
(c) Cost and Profit Position
The average cost and net profit realized in the manufacture of creamery
butter for the fiscal year preceding October 1, 1946, is clearly set out in
Table 6 to Mr. Entwistle's report. For convenience that table is set out
below :
140 ONTARIO ROYAL COMMISSION ON MILK
Manufacturing Cost of Creamery Butter
for the Fiscal Year Next Preceding October 1, 1946
Cents per
Sales
%
100.00
pound
35.25
Cost of:
Churning cream and ingredients
Hauling
82.51
1.80
29.09
.63
Containers and packages
1.38
.49
Material cost
85.69
30.21
Cost of:
Processing, labour
Selling, administrative and general salaries
6.05
1.85
2.13
.65
Labour cost
7.90
2.78
Cost of:
Repairs
85
.30
Depreciation
90
.32
Facilities
3.40
1.20
Services cost
5.15
1.82
Total cost ..
98.74
34.81
Net profit before taxes
1.26
.44
I will only comment on two aspects of this table, (a) that over 82% of
the sale price of a pound of butter goes to the producer, and (b) that the net
profit margin before taxes is approximately 1.26%. Thus the processing
margin is a small percentage and any savings made will of necessity be
fractions of one per cent. It follows that the only way to achieve sizeable
savings is by greatly increasing the average volume of production per plant.
Earlier in this chapter 1 drew attention to the Saskatchewan average plant
production as being in excess of three-quarters of a million pounds annually,
as compared with Ontario's quarter million pounds. I would also note the
New Zealand average of over one million one hundred thousand pounds
annually and the fact that in that country the bulk of production of creamery
butter comes from factories which also produce large quantities of cheese.
Mr. Entwistle has analysed the financial position in detail in his report,
and in view" of the fact that there do not appear to be any glaring inequities,
I would direct attention to this report for further observations.
Summary
Briefly, the cream and butter aspect of the dairy industry is largely
dependent for improved financial return to the producer and minimum price
to the consumer on steps that lie within the power of the producers
themselves.
I am of opinion that full support should be given the new Cream Producers'
Association in their eff"orts, and that every opportunity should be taken to
reduce the number of creameries and increase the volume of production
per plant.
ONTARIO ROYAL COMMISSION ON MILK 141
CHAPTER XII
The Concentrated Producers and Manu-
facturers of Concentrated Milk
and Their Position
I was advised during the hearing that there are approximately between
13,000 and 14,000 farmers in Ontario who produce milk for concentrated
milk factories. Representations on their behalf were made through a trade
association known as the Ontario Concentrated Milk Producers' Associa-
tion, which, it was stated, has a membership of approximately 12,000 pro-
ducers located chiefly in Southwestern and Southeastern Ontario. It was
indicated that there were probably between 1,000 and 2,000 other producers
of milk for concentrated purposes who are not members of the Association;
but in view of the large number represented I assumed that the Association
could reasonably speak for all the producers in this field.
The Association is made up of local branches, and the list of those given
me would indicate that the farmers producing milk for this purpose are
concentrated in Western Ontario in the Counties surrounding Oxford and
south thereof: in Eastern Ontario in the Kingston area, and to a certain
extent in the eastern part of the Ottawa Valley. This Association, as in the
case of associations representing other sections of the producers, is main-
tained by fees collected from the farmers by the factories on the weight of
milk sold. The condensaries manufacturing the products of these producers
number something in excess of thirt\ . In addition, some of the larger dis-
tributors of fluid milk, like Bordens and Silverwoods, engage in the con-
densation and evaporation of milk.
Producers and Their Cost Position
Except for a somewhat limited portion of Western Ontario, the most of
the farmers producing milk for the condensaries supply the major part of
the milk during the so-called flush season. There are striking variation*
between the amount available, say, in the month of June, and the amount
available to the same factories in December. This is, of course, a factor
which increases cost of manufacture. On the other hand, it should tend to
reduce the producer's costs, as he does not have to go to the expense involved
in maintaining a level supply of milk over the whole year. I see no object
in repeating the observations made in the general Producers' chapter on
producers' costs. Speaking generally, however, the same economic factors
operate in this field as apply in the fluid milk field. The financial return
to the producer should reflect the demand for the manufactured product and
the prices obtained for it. There was some question in the mind of the
Producers' Association as to whether this was actually the case. That this
doubt has some justification is indicated by Mr. Entwistle's study of the
profit position of some of the principal manufacturers of concentrated milk,
which is attached as Appendix 24 to this report. In the brief filed before
me by the Concentrated Milk Producers' Association, their general cost of
production of milk was estimated at S3.00 per hundredweight. In the
examination of the cost position of the concentrated producers made on
142 ONTARIO ROYAL COMMISSION ON MILK
behalf of the Commission, the general average figure for the whole province
was S2.93 per hundredweight of milk produced. This, of course, includes
an administration allowance, which the Association's figures did not. The
details of it are as follows:
AVERAGE COSTS FOR THE PROVINCE OF PRODUCING MILK FOR
CONCENTRATED MILK PRODUCTS
Concentrates $ .73
Hay .46
Silage 20
Pasture .24
TOTAL FEED COSTS $1.63
Dairy Herd Labour .92
Depreciation 17
Hauling ■. .12
Miscellaneous 29
GROSS COST S3.13
CREDITS:
Milk used on farm $ .09
Manure 20
Cattle sales less cattle purchases and inventory
adjustments .29
.58
AVERAGE NET COST $2.55
ADMINISTRATION ALLOWANCE .38
TOTAL COST INCLUDING ADMINISTRATION ALLOWANCE $2.93
It should be remembered, of course, that this is an average figure for the
whole province. It may well be asked why, if a large part of this production
is on much the same seasonal basis as is production for cheese purposes, the
increased cost? The evidence before me would indicate, however, that by
and large the farmers producing for this market do a greater amount of
special feeding with purchased grains and concentrates than is done by many
of those producing for cheese. It is also partly the result of a growing
tendency on the part of Western Ontario producers to supply this milk in
fairly equal quantities throughout the year. It was stated in the Associa-
tion's brief that the average return at the time of the hearing was about
S2.25 per hundredweight. It must, of course, be realized that at that time
the industry was operating under price ceilings except as to the competitive
export business. These ceilings have since been removed, resulting. I believe,
in an increase in both the price of the finished product and the price paid to
the producers. I am advised that the recent increase to the producers is 12
cents per hundred pounds. If the figures I have quoted are any guide, the
producer is still far from receiving his cost of production.
Essentially the problem confronting the producer of milk for concentration
is very closelv related to the surplus fluid milk problem which has been
discussed in detail in the general Producers' chapter. The Producers for
cheese by and large control the manufacture of their product, but stop short
of marketing it. The Concentrated Producers have by no means reached
that position, and are largely in the hands of their manufacturers at the
ONTARIO ROYAL COMMISSION ON MILK 143
present time. If some of the suggestions made in the general Producers'
chapter leading to the erection of producer-owned concentrating plants are
followed out, the competition thus afforded will, in my opinion, in great
measure solve many of the difficulties facing the producers in this special
group. One has only to look at the submissions made by the Concentrated
Milk Producers' Association to realize that many of the problems with which
thev are confronted are similar to those of the fluid milk producers. They,
like the fluid milk producers, are somewhat dissatisfied with their butter-fat
ratings, and made the very practical suggestion that representatives of the
Association should be allowed to check on the ratings given the individual
producers by the various factories. To cite another example, if considera-
tion is given to the transporting of milk to condensaries, many of the matters
which are dealt with in the general chapter on transportation apply with equal
force to this group of producers.
While the problems of the two groups are in many cases similar, it is, I
think, generally true to say that thus far the problems of the concentrated
producers have not been as effectively dealt with. Obviously, this is the
result of the fact that, as a group, they are not as powerful. By and large,
the condensaries are in a stronger bargaining position with their producers
than are the distributors of fluid milk with theirs. In saying this I do not
criticize the producers. The very nature of the business of condensing milk
is entirelv different from that of distributors, who must have a day-to-day
supply of fluid milk for the consumers. If necessary, the manufacturers can
wait.
The Transportation Problem
One of the chief complaints made by the Concentrated Producers is that
they are charged a flat rate for the transporting of their product irrespective
of their distance from the factories. The answer of the plants to this is that
they think this basis of charge fairer to everyone concerned. From their
viewpoint this practice assists in assuring adequate supplies of milk. While
the cost of transportation is charged to the producer by the factory, the
contracts appear to be made between factory and trucker, and the producer
is thus in a position where he is asked to pav for something over which he
has verv little control. In mv view the general recommendations made in the
Transportation chapter in respect of fluid milk would apply with equal force
to the transporting of milk to the concentrator factories. This view, how-
ever, is not shared by the Producers' Association. It is said that the practical
difficulties of testing and weighing the milk at the farm are too great to be
overcome. I must say I find it difficult to credit this. In my view, as
previously expressed, thought directed towards solving these difficulties
would pay substantial dividends. Insofar as producers for this market are
denied the advantages of co-operative trucking and are subject to the onerous
licensing provisions presently in force. I would make the same recommenda-
tions with respect to them as are made generallv with respect to the trans-
porters of fluid milk. These are contained in the general summary of con-
clusions and recommendations at the end of this report.
Price Fixing to Producers
With respect to the administration of the Manufacturing Milk Board, it
would appear that up to 1942 the price paid the producers was calculated on
the basis of a formula which was used by the Manufacturing Milk Board
from 1935. The formula price as used was a composite value for milk
determined on the basis of the market quotations for butter and cheese plus
144 ONTARIO ROYAL COMMISSION ON MILK
a premium to cover the value of solids-not-fat in the milk. In 1942 this
formula was abandoned, because what had been considered the normal rela-
tionship between butter and cheese was thrown out of balance by price
changes resulting from war conditions.
It is noted that this formula established a minimum price, and in fairness
to most of the manufacturers, I have been advised that the prices paid by
them in many cases were in excess of these. This was particularly true of
the prices paid during 1945 and 1946. With the coming of price control
maximum prices were fixed for the manufactured products. This, of course,
had the effect of indirectly controlling the producer price, although this
price was not specifically dealt with under the dairy orders of the Wartime
Prices & Trade Board. It should be noted, however, that from December,
1941, down to the end of September, 1946, producer subsidies in varying
amounts were provided bv the Dominion Government.
I am told that in 1945 an application was made to the Milk Control Board
to review the minimum prices established for producers, but that after a
somewhat lengthv hearing it was decided not to increase these. As I have
stated above, while there is no formal order in existence at the present time,
the manufacturers of concentrated milk have apparently agreed to increase
the price prevailing to the extent of 12 cents per hundredweight. I believe
this is an arrangement which is to be reviewed from month to month.
By and large it cannot be said that the Milk Control Board, through the
Manufacturing Milk Board, has intervened in this branch of the industry to
anything like the extent which it has in the fluid milk field, and it would
appear that in future the Board should more actively arbitrate between the
producers and manufacturers as to producer prices. If this is to be effective
such arbitration can only be based on a full and continuous knowledge of
producer costs and of manufacturing costs and profits. It has not been
suggested to me in the evidence or in anything I have been able to discover
that the Manufacturing Milk Board has had this information, which in my
opinion is essential to its dealing properly with this important matter.
Marketing Scheme
It is interesting to note that the Concentrated Producers, more than anv
other group, emphasized the value to the producers in Ontario of an over-all
marketing scheme. I have previouslv quoted their resolution in this respect
in the Producers' chapter. Such a scheme would possibly solve the problems
of this group of producers to a greater extent than almost anv other group
in the producing end of the industry. In mv view, however, as I have already
said, when the problem of surplus fluid milk is considered the advantages of
a general marketing scheme to producers as a whole appear to be pro-
nounced. I would suggest that the possibility of working out such a scheme
be investigated without delay.
Consumer Prices, Profits, Etc.
It is significant to note that in any representations made on behalf of the
Concentrated Milk Producers' Association they agreed that it was unwise
and undesirable to fix a price at the consumer level for the manufactured
product resulting from their milk. As will be seen when the situation of
the manufacturers is discussed, milk is concentrated in Canada chiefly in
the Provinces of Ontario and Quebec, and the position of the companies,
insofar as costs are concerned, must be carefully weighed as between the
two provinces if it is desired to retain the advantage of the processing of
concentrated milk within Ontario through existing facilities. While up to
the end of 1946 there has been a very large demand for concentrated milk
ONTARIO ROYAL COMMISSION ON MILK 145
products for export, if the experience of the last war is any guide this may
well now be on the downgrade. This is emphasized in Mr. Entwistle's study
in Appendix 24. and would appear to be already in process. As Mr.
Entwistle points out. it is already some 24 per cent less in the first quarter
of 1947 than for the corresponding period in 1946. It must be remembered
also that in the domestic market very keen competition is brought to bear in
the industry by the co-operative manufacturing carried on in British
Columbia and Alberta: and that freight rates to the Western Provinces are
a considerable factor in determining the prices to be charged in the domestic
market. These are all considerations which must inevitably affect the return
to the producer. It cannot be said, however, that it is in the interests of
the producer or the public at large that the manufacturer of these products
should be allowed in any given period of time to accumulate strikingly high
profits at the expense of the producer. This situation will be discussed
later, but if it occurs, as it appears to have occurred in the ]>eriod under
review, there is a very strong case for producers asking that they be given
a reasonable share of this benefit.
Manufaclurers
Mr. Entwistle's report deals with the situation in respect to the manu-
facture of concentrated milk products. While I propose to deal with certain
general tendencies which he notices, there is no object, in my view, in
repeating what he has said, since it is available in Appendix 24.
Looking at the over-all study made by Mr. Entwistle, it would appear
that the financial position of the industry is not only extremely healthy at the
present time but has been very greatly improved in recent years. It must
be remembered, of course, that this study presents the general average picture.
The financial results differ markedly from firm to firm, not only because
of variations in the scale of operations, but also depending upon the extent
to which the total business is di\ ided between domestic and export sales,
and between one type of concentrated product and another. As appears in
the report, while the domestic price ceilings were in operation most firms
producing evaporated milk incurred considerable loss on the domestic
business. On the other hand, in most cases a substantial profit was made
in the domestic market in respect of the sales of condensed milk. The
general financial result is further affected by the manner in which the
different types of business are divided as between provinces. For example,
in certain cases certain products on which satisfactory profits were available
have been manufactured in the Province of Quebec, whereas other products
designed for the less remunerative domestic market were produced in
Ontario plants of the same companies. This practice makes it extremely
difficult to determine the extent of over-all orofit or loss on the purely
Ontario business of some of these concerns. This is still further complicated
by the fact that some of the firms concerned are branches of parent companies
with headquarters in Great Britain and the United States. Because of the
variations in the type of product manufactured and the markets catered
to. it is fairly obvious that the various members of the industry may in
practice find considerable difficulty in agreeing upon prices which they
can afford to pay producers. This mav have some significance when it is
considered that none of these manufacturers saw fit to make any sub-
missions or voluntarily to give any information to the Commission. It was
necessary to request all the information obtained.
As appears in the report, the various costs incurred by the manufacturers
of condensary products have increased substantially since the year 1939.
146 ONTARIO ROYAL COMMISSION ON MILK
At the same time the increased volume of demand for these products has
apparently made it possible to offset these cost increases, and indeed to
leave the firms concerned in a very much stronger financial position than
they were at the beginning of this period. It should be realized, however,
that if demand diminishes, and particularly export demand, as it seems
to be doing, this situation may not continue. Obvioush anv decrease in
volume of production very materially increases manufacturing costs. It may
well be that after a number of lush years the industry is now facing some-
what more difficult times. This tendency toward pronounced changes in the
situation indicates the necessity for continuous study on the part of the
Milk Control Board, both as to producer costs and manufacturing margins.
In view of Mr. Entwistle's conclusions, it may well be that con-
sideration should now be given by the Manufacturing Milk Board to the
problem of producers' prices. It would appear desirable that the powers of
the Board to arbitrate prices between producers and manufacturers be
clarified and clearlv laid down. It may well be that, in view of the present
financial position of the manufacturers, minimum producer prices approxi-
mating their present cost of production can be established. It is impossible
to say this dogmatically as a result of Mr. Entwistles study. The difficulty
in this connection arises from the fact that many of the principal manu-
facturing concerns in Ontario are branches of larger organizations outside
this jurisdiction and complete consideration could not be given to their
affairs. It would seem desirable that minimum standards of accounting
together with sufficient information as to overall operations, should be
established by the Manufacturing Milk Board and be at all times available
to it. It is equally desirable that there should be a long-term study of
Concentrated Producers" costs in the possession of the Board. At the
moment all I think that can be fairly said is that it would appear from the
examination that has been conducted that the producers are not at the
moment receiving their full share. In saving this due consideration must
be given the possibility of the costs of manufacturing outside Ontario and
of the value of the present industry to the producers and public in this
Province. It may well be, as I have said before, that the salvation of the
Concentrated Producers is in their own hands and that co-operative manu-
facturing by them would carry them a long wav towards solving their basic
problem, which is to obtain their fair cost of production plus reasonable
profits.
ONTARIO ROYAL COMMISSION ON MILK 147
CHAPTER XIII
General Conclusions and Recommendations
The Milk Control Act was originally passed to relieve a state of crisis
which existed in the production and distribution of fluid milk in the Province
in the year 1934. Methods propounded to meet this crisis have grown into
a species of control maintained long after the emergency has ceased to exist.
If it were possible to disregard this development, an arrangement where
the producers of milk in this Province were organized in a marketing
authority with power to direct the disposition and use of milk for whatever
purpose seemed appropriate, would seem the best solution of their diffi-
culties. As I have suggested, this might well be modelled on the present
British scheme, which is in essence an organization of the producers them-
selves. But as I have previously indicated, the producers as a class, apart
from some such comprehensive organization, are not able to protect them-
selves in bargaining with the distributors. If they were, I would be inclined
to the opinion that the full play of competitive forces would reasonably
protect the consumer in respect of distribution and would in the long run
produce a much more economic and better organized system in the industry
as a whole. Practically speaking, however, the producer organizations are
not strong enough at the moment to fend for themselves alone. No over-all
marketing organization of producers exists in the Province of Ontario.
I must deal with the various factors as they exist at the present time.
It would, therefore, seem essential at the present to maintain the existing
controls.
The effect of the operation of the Milk Control Act since 1934 has been
to remove most of those competitive pressures which ordinarily operate in
respect of private business. In doing this, it has not substituted that full
measure of public control which would seem to be the necessary alternative.
In the result, therefore, particularly under inflationary or semi-inflationary
conditions, the consumer has suff^ered. Instead of having the benefits of
the operation of one principle or the other in the industry, the general public,
in my view, have had some of the worst results of both. At the present time
fluid milk as produced and sold in Ontario is, for practical purposes, a
standard article sold at a fixed price. The only real measure of competition
left among the distributors has been that competition in services, which is
probably the most wasteful and extravagant form of competition that exists.
What should be done at the moment would seem to me to be the taking of
necessary measures to re-introduce some real and effective competition in
the distributing end of the industry; and, for the protection of the producers,
to continue the existence of the Milk Control Board. Its powers, however,
should be clarified and enlarged. Under the present circumstances it is not
sufficient to allow the industry to regulate itself at its own free will. There
is an obligation on the Board to bring pressure to reduce waste and duplica-
tion, and to see that the interests of the three groups which are vitally
concerned in the industry, namely, the producers, the distributors and the
consuming public, are each reasonably protected and considered in a more
definite and effective way than in the past twelve years.
148 ONTARIO ROYAL COMMISSION ON MILK
While the earlier period of the Milk Board's operations may be thought
of as an emergency period during which the central objective was to bring
order out of chaos, the time has now arrived when the general objectives of
the Board should be greatly enlarged. The basic reason for its continued
existence must be its success in obtaining increased efficiency in milk
production and marketing.
In respect of the Milk Control Board, therefore, certain specific recom-
mendations are made herewith: others will appear as incidental to recom-
mendations made under other heads.
Before making these recommendations, however, there is one other matter
that should be mentioned: Sections 4 and 13 of the Milk Control Act give
the Board various powers. Some doubt has been raised by the law officers
of the Crown as to the power of the Board to fix prices under these sections.
A perusal of the sections undoubtedly affords a reasonable basis for the
doubts expressed. Without expressing an opinion on the Board's powers
under the present statute, it should be pointed out that it casts a great and,
in some measure, unfair responsibility on government to ask it to fix prices
in a private industry, in the general administration of which it has in effect
no decisive voice. The only justification for such exercise of authority
would appear to be some infringement of the public interest. Insofar as
price fixing is concerned, in the first instance the basic responsibility for
the determination of prices would seem to rest on the industry itself. If,
however, it is impossible for the parts of the industry to agree, then in
dealing with a vital food such as fluid milk it may be desirable that an
administrative authority such as the Milk Control Board should have the
right to arbitrate between the various interests, and to determine an arbitrated
price between the component sections. Similarly, if a price arrived at by
the industry is against the public interest, paying attention to the interests of
the producers, distributors and consumers alike, there may be responsibility
on government to intervene in respect of the interest adversely affected. It
is desirable also that the administrative body dealing with the problem
should be able to advise the final authority on a sure basis of knowledge and
accurate information. To date there has been no consistent effort to study
the costs and profits of either the producers or the distributors. For example,
at the time of this investigation such a fundamental fact as the ratio of whole-
sale to retail sales in the distribution of fluid milk was not available in the
records of the Milk Control Board or the statistics branch of the Department
of Agriculture. A sample study had to be made on behalf of the Commission.
I therefore recommend.
As to Price Fixing:
(a) That the Milk Control Board commence and continue the collection
and study of representative cost data in respect to producers. Detailed
suggestions as to how this might be done are contained in Appendix 28.
( b I That it should also undertake a continuous collection and study of
the cost and profit position of the distributors. It may be that the powers
of the Board under section 15 as at present constituted are sufficient for
this purpose, but if not thev should be reconsidered and clarified.
(c) That such additions to the staff of the Milk Control Board as are
necessary to carry out fa) and (b) be considered.
(d| That sections 4 and 13 of the Milk Control Act be revised to clearlv
give the Board authority to arbitrate a price for fluid milk as between
producers and distributors, and in cases of necessity as between distrib-
utors and consumers.
ONTARIO ROYAL COMMISSION ON MILK 149
(e) Further, that the power of the Board be made clear to enable it to
ultimately determine a price for fluid milk either to the producers or to
the consumers if the prices obtaining are against the public interest, as
determined by the rights and interests of the producers, the distributors
and the consumers, with the result that in practice —
li) The price of fluid milk at the consumer level be not agreed to or
fixed in ordinary circumstances. The power should be a corrective one
only, and
( ii ) That prices paid by distributors to producers be fixed or agreed
upon as heretofore and that such prices be ordinarily fixed on the basis
of delivery at the farm unless other methods are successful in eliminating
duplication and excessive cost in transportation from farm to dairy.
As to Co-operatives —
(f I That section 11 of the Milk Control Act preventing rebates by dis-
tributors to customers, and which in effect prevents the effective operation
of consumer co-operatives, be repealed.
Licensing —
(g) (i) That the administrative and judicial functions of the Board
as to licensing be separated by setting up an Advisory Board somewhat
siniilar to the Insurance Advisorv Board in order that the judicial functions
of the Milk Control Board be exercised as provided by the statute free
from administrative bias.
( ii ) That the conditions entitling applicants to licenses be more explicit-
ly set forth in the Milk Control Act.
Composition of the Board —
( h I At the moment the Board is set up on a representational basis.
Without undul\ criticizing the unselfish service that has already been given
to it by those appointed under this system. I am unable to see much solid
advantage in it. I would recommend that in future when appointments
to the Board are being considered regard should be had to the capacity
and fitness of the person concerned rather than to the interest he or she
represents.
Consumer Representation on Milk Control Board —
(i) In respect of consumer representation on the Milk Control Board,
as I have said I do not think that representation of special interests adds
greatly to the strength of such a body. The present provisions in the
Milk Control Act for consumer representation in special markets, should
be continued, but the administrative practices in respect of them should be
chaneed and the intent of the Act followed more closely. I would recom-
mend that where a consumer representative is accredited to the Board and
enters on his duties, he should be required to take an oath of secrecy and
that all the information available to the Board be completely disclosed to
the consumer representative in respect of the matter under consideration.
Recommendations with Respect to Producers
In respect to the producers, as I have alreadv stated, my view is that the
ultimate solution of their difficulties will be found in the setting up of a
marketing organization for all producers. This may not be immediately
practicable and. if not. T would suggest:
-|^50 ONTARIO ROYAL COMMISSION ON MILK
(a) That a start be made in organizing the fluid milk producers, and
that the further study and consideration of the entire project be initiated
and pursued with as little delay as possible by the existing joint committee
representing the four sections of milk producers. In respect of the form
of such an organization, attention is again specifically directed to the
British scheme, which would seem to provide most of the necessary prin-
ciples upon which to build such an organization.
(b) That the existing producer organizations, particularly the Ontario
Whole Milk Producers' League be encouraged themselves to take steps
to process and dispose of fluid milk not required for the fluid market. In
view of Mr. Entwistle's study of production prices paid producers and
distributor spreads, a substantial increase in the price paid to producers
for secondary milk would appear to be justified at the present lime without
alteration of consumer prices for the resulting products and such increase
might be found to be as much as 10% more than present prices.
(c) That the regulations of the Milk Control Board assure that producer
association employees be permitted to check the accuracy of testing in
distributor and processing plants to remove present suspicion and dis-
satisfaction regarding the accuracy of these tests.
(d) That the practice of paying price premiums or discounts in accord-
ance with variations in butter-fat content of the milk be reviewed to the
end that the amounts paid correspond with current prices for butter-fat.
These particular payments should be subjected to review and, when neces-
sary, revision at monthly intervals.
(e) That in view of the existing conditions of supply and demand no
further increases in fluid milk prices be granted at the present time. This
recommendation is made in view of the demand situation, and despite the
fact that in the view of the Commission existing prices do not cover the
cost of production plus a reasonable profit or even a proper administra-
tion allowance.
(f) That the present eff^orts through the Department of Agriculture be
intensified to assist producers in applying the knowledge gain.^d bv research
and studv to the further improvement of volume and quality of production
and to the further reduction of producers' costs.
Special Recommendations in Respect to Transportation
It is obvious from a perusal of the discussion of Transportation in this
report that I regard the present system as uneconomic and wasteful. Ideally,
I think it would be desirable to fix the price of milk at the farm and allow
normal competitive pressures on the distributors to lead them to rationalize
their methods and costs of collection. This may not be immediately prac-
ticable, but, if it were possible, I would recommend:
(a) That where the price of milk to producers is fixed, it be fixed on
the basis of delivery at the farm.
(b) In default of this I would recommend that the Milk Control Board
be given the power to fix rates for transporting milk and to designate and
license all truckers of milk.
(c) That the licensing of such truckers under the Commercial Vehicle
Act be discontinued.
(d) That the practice of conducting hearings before the Municipal
Board be discontinued, and that the whole power be vested in the Milk
Control Board.
ONTARIO ROYAL COMMISSION ON MILK 151
(e) The regulations under the Milk Control Act, and the Milk Control
Act itself, should also be clarified to give the Board authority to designate
routes for such truckers.
The foregoing observations in respect to the transportation of fluid
milk apply with equal force to the transportation of milk and cream to
condensaries and creameries.
(f) That the regulations be changed and the Commercial Vehicle Act
be amended to permit farmers to haul milk co-operatively through co-opera-
tive associations for themselves and their neighbours, and that such
permission be granted without regard to other existing facilities.
Special Recommendations in Respect to Distribution
In the hope that experiments in further economies, such as quantitv
discount sales, depot sales, every-other-day delivery, five and six-day delivery,
zoning and similar practices will be actively investigated and tried, it is
recommended :
(a) That the retail consumer price should be made open and competi-
tive without fixation by agreement or Milk Control Board order.
(b) That the special distributor economies brought into effect in 1941
and 1942 under wartime conditions be retained by the distributors.
(c) That all distributors be required to maintain a complete and
standardized set of business and financial records.
(d) That returns sufficient to enable the Milk Control Board to
determine their costs and profit margins be required of all distributors,
to be filed not less than three months after the end of their fiscal year,
these records to include details of capitalization, depreciation and financial
policies generally.
Recommendations in Respect to Consumers
It must be apparent from a perusal of Chapter 7 that, looking at the
over-all picture in Ontario, no recommendations as to price reductions from
those presently obtaining can be made when the interests of all the distri-
butors are considered. Mr. Entwistle's report shows that about 12 per cent
in number of the distributors, who apparently distribute more than 50 per
cent of the fluid milk in the Province, could sell milk at cheaper prices.
I suggest that cheaper prices might be brought about by providing for a
free competitive price at the consumer level. If it is done by other means
it may well be that the larger number of the distributors, something in excess
of 750 in all, will not be able to withstand the financial pressure of prices
lower than those presently in effect. So far as volume distribution is
concerned, it would appear that such a price reduction would adversely affect
those who distribute less than half of the volume of fluid milk sold. It would
unquestionably affect many of the distributors in smaller markets.
It is a question whether it is best in the public interest to maintain the
existing large number of small distributors in certain cases at the cost of
milk consumers; or whether through arbitrarily narrowing the distributor's
spread it is better to accelerate the slow process of amalgamation that has
been going on among the distributors since the passing of the Milk Control
Act in 1934. Arbitrary narrowing of the distributor's spread at the present
time would undoubtedly accelerate the process of amalgamation and con-
solidation, and the distribution end of the industrv would end in the hands
152 ONTARIO ROYAL COMMISSION ON MILK
of a few large distributors. As they are presently situated, the smaller
distributors, except in rare instances, could not withstand the financial
pressure resulting from such a policy. Insofar as many of them are con-
cerned, the result might be financial embarrassment, forcing them to amal-
gamate with their competitors to obtain larger volume, or they might be
forced to sell out to the existing large volume distributors. Which state of
affairs is the most desirable is a question of public policy, on which it would
not be proper for me to comment. In my view, however, the abolishing of
the practice of fixing prices for fluid milk to the consumers and the restora-
tion of competition as to price among the distributors, is well worth trying
before other measures are considered.
Nevertheless, despite the apparent costs of production and distribution
at the present time, in view of the fact that cheap milk generally means large
volume of consumption, it might well pay both the producers and the
distributors of fluid milk arbitrarily to cut their prices all along the line
to something approaching the level obtaining before the price increases of
October 1, 1946, or in any event by a substantial amount. The problem
of the producers' surplus, which seriously affects the average price received
bv the producer, might no longer be so pressing. The experience of the
distributors over the war years under conditions of rapidly expanding
volume and low consumer prices might justify them in again trying the
experiment.
It is recommended that the necessarv amendments be made to the
Municipal Act and the Milk Control Act to permit the setting up and operation
of municipally owned distributor plants with power to deal in all dairy
products and that in so doing such distributor operations be made liable
to Municipal and Provincial taxes in like manner as other Distributors.
Finally it is recommended that consideration be given to supplying milk
to school children in primary and secondary schools through public assistance
at cost, or in cases of necessity free of charge; and that in considering the
same, attention be paid to the provisions of the National Milk Scheme in
Great Britain.
Recommendations in Respect to the Cheese Producers
In respect to the cheese producers, discussion of their problems in the
Chapter relating to them does not give rise to any special recommendations,
but it would seem essential:
( a ) That they take steps which should be implemented in any way
possible by the Department of Agriculture to improve the quality of their
product and to extend a further and more eff^ective control over its final
• marketing.
(bl That steps should be taken to familiarize the industry with the
provisions of the legislation, both provincial and dominion, providing
for financial assistance with respect to the erection of amalgamated
factories.
(c) That the cheese milk producers give most serious consideration
to the formation of an over-all marketing scheme.
Recommendations in Respect to the Cream Producers and Creameries
The general recommendations made in respect of Transportation would
apply with equal force to the transportation of fluid cream used for buttei-
making. The recommendations already made in respect of an over-all market-
ing scheme apply with particular force to this large group of producers.
ONTARIO ROYAL COMMISSION ON MILK 153
No doubt any experience gained in the marketing of cream under the
Farm Products Marketing Act should be most valuable and should be
studied carefully.
Specifically the only additional recommendation I wish to make is that
every effort be made by producers, creameries, and through governmental
assistance, to greatly increase the volume of production per plant.
Recommendations in Respect to the Condensaries
Many of the observations made in respect to the distributors of fluid milk
apply to the manufacturers of milk. It is recommended:
(a) That the Manufacturing Milk Board be given clear authoril\ under
the Milk Control Act to require standard methods of accounting, and full
and regular information from the manufacturers in connection with their
operating costs and profits.
(bl That where such operations in the province represent branch
operations of larger concerns with headquarters outside this jurisdiction, a
division be made between the business done within and without tho
province; and to effect this, regulations be made standardizing the
accounting methods of these firms.
(c) That along with the study of producer costs in other branches of
the dairy industry there be included a study by the Milk Control Board
of the costs of producers who produce milk for concentration.
( d I That the producers of milk for concentrated purposes be encouraged
to undertake the formation of co-operative processing plants as a means
of ensuring that these producers receive the full competive price for their
milk and that consideration be given to providing public assistance for
such projects.
(e) That the Milk Control Board investigate the present prices paid
concentrated producers for their milk, and in view of the financial situa-
tion of the manufacturers, consider whether price increases to producers
beyond those already granted should not now be enforced.
In conclusion. I desire to record m) indebtedness to the Statistics Branch
of the Ontario Department of Agriculture for placing at our disposal much
of the information available in their records, and for the ready courtesy
and co-operation shown. The information has been most helpful both to
myself and to Mr. Entwistle.
In connection with the survey of producers' costs, I desire to acknowledge
the courteous assistance of Professor H. K. Leckie of the Economics Depart-
ment and Professor N. J. Thomas of the Soils Department, of the Ontario
Agricultural College. Their advice was helpful and suggestive to those
assisting the Commission when this survey was made.
Sincere thanks are also due to Professor H. A. Smallfield of the Dairy
Department of the Ontario Agricultural College for the information and
assistance he has given to the Commission.
Appreciation of the assistance and co-operation received from Mr. C. M.
Meek, Chairman of the Milk Control Board has already been recorded in
this report.
I also wish to acknowledge the assistance received from producers, dis-
tributors, consumers and many other interested persons and organizations
in submitting evidence, both documentary and verbal. Many troublesome
questions were asked, particularly of the distributors, and for the most part
the Commission received the readiest co-operation from those being
questioned.
154 ONTARIO ROYAL COMMISSION ON MILK
Counsel representing the various interests appearing before the Com-
mission were at all times most helpful.
If I may do so, I would also like to record my appreciation of the very
full and impartial manner in which the Press of the Province covered the
course of the Inquiry.
I find it difficult to adequately express my appreciation of the assistance
rendered to me by Professor W. M. Drummond, who was appointed as
Economic Consultant to the Commission. His encyclopaedic knowledge of
the problems involved has at all times been at the disposal of myself and
all others connected with the Investigation. It is difficult to adequately
measure the extent of the assistance and co-operation Professor Drummond
has rendered, both during the hearings and in the preparation of this
Report. It has been of the highest order. In fairness to Professor Drum-
mond, however, it should be said that I assume full responsibility for any
conclusions reached and recommendations made.
Mr. Beverley Matthews, K.C., Counsel to the Commission, Avas of very
great assistance in the conspicuously able and impartial manner in which he
brought out the evidence bearing on the matters under consideration. His
advice and counsel throughout have been exceedingly helpful.
The extent of the investigation by Mr. John Entwistle, C.P.A., into the
financial aspects of the industry is best measured by an examination of
his reports, which were of such importance that I felt thev should be
included as appendixes to this Report. Much information, which it is hoped
will be of value to the industry and to the public generally, has been
uncovered. It would be gratuitous on my part to say more than that his
reports speak very clearlv for themselves. Mr. Entwistle's services have
been available to me at all times, and to him and to his staff I express
mv sincere thanks.
To Mr. Donald A. Keith. Barrister-at-law. and Secretary to the Commis-
sion, I express my unreserved thanks. The ease with which the whole investi-
gation was managed was largely the result of his work. He has been most
active in assisting in the preparation of the Report. His efficiency and
conscientious assistance has greatly simplified the task given to me.
Finally, I desire to thank Messrs. Svdnev W. Brown, Arthur G. Veitcli
and J. B. McGregor, Chartered Shorthand Reporters, and official reporters
to this Commission, for the painstaking and conscientious manner in which
they and their staff performed their duties. "Dailv copy" Avas furnished with
faithful regularity, despite difficulties at out-of-town sittings. These gentle-
men have also had in hand supervision of the physical production of this
report.
I have the honour to be,
Sir,
Your obedient servant,
DALTON C. WELLS,
Commissioner-
Donald A. Keith,
Secretary.
Toronto, 1st August, 1947.
ONTARIO ROYAL COMMISSION ON MILK
155
Index
PAGE
Artificial Insemination 67
Bartlett, Dr. Roland W 3
Barton. Dr. G. S. H 129-139
Bonding of Distributors 12, 14, 15
Borden Company Ltd., The 84, 105
British Marketing Scheme 62, 68
Butter, Production of 138
Cost and Profit 139
Butter-Fat Test 47
Chaos in Industry 3
Check-Testing 16, 57, 143
Cheese, Price of 125
Subsidies for 125, 126
Costs of Production 126
Cheese and Cheese Factory Improve-
ment Act, The 24, 129
Cheese and Hog Subsidy Act, The. . . 25
Cheese Boards 124
Cheese Factories 123, 124
Amalgamation of 129
Cheese Production 123, 127
Commercial Vehicle Act, The 26
Competition by Distributors 125
Concentrated Milk 141
Cost of Production 141
Manufacturers 145
Marketing Scheme 144
Price to consumers 144
Price to producers 142, 143
Transportation of milk for 143
Consolidated Cheese Factories Act,
The 25, 139
Consolidation of Cheese Factories . . . 129
Consolidation of Creameries 139
Consumer Prices, fixing of. 106
present ievel 114
Consumer representation 13, 22
Consumers, Submissions by 117
Co-operative Delivery 97
Co-operative Marketing Ill, 119
Co-operative Marketing Loan Act,
The 26
Co-operative Transportation 76
Costs of Distribution
Continuous study of 21
Calculation of 82, 91
Capital Employed 99
Methods of reducing 93
Wage and labour costs 102
PAGE
Costs of Production
Administration allowance 55
Calculation and use of 37, 46
Continuous study of 20
Detailed accounting method 39
Estimation Method 38
Factors affecting 19, 33
Farmers' record plan 39
Findings with respect to . . . 51, 52, 54
Formula plan 39
Reduction in 42
Survey method 38
Costs of Transportation 75
Cows, number of milk 36
Cream Production 133
Cost of 133
Economies in 134
Premium for quality 134
Subsidies for 134
Creameries. Capacity 137
Combined operations 139
\'olume of production 138
Dairy Industry Act, The 24
Dairy Products Act, The 25, 134
Depot Deliveries 95
Discounts for quantity purchases. . . 97
Disease, loss of cattle by 34
Distribution
as a public utility 110
Economies in 17, 92
Combined operations 102
Costs of 21. 82, 91
Profits of 83. 90. 103, 114
Distributors
Accounting practices 19
Bonding of 12, 14
Competition by 87, 110
Licensing of 6, 12, 15, 82
Number of 83
Profits of 83, 90, 103
\'oiume of business 83
Dominion Dairies Ltd 105
Economies in Distribution 17, 92
Every other day delivery 96
Evidence of
Douglas Hart 31
S. L. Joss 123
R. F. Lick 66
CM. Meek 6,86
156
ONTARIO ROYAL COMMISSION ON MILK
PAGE
Fenton Maclntyre 66
Mayor Sam Lawrence 120
V. S. Milbum 136
Dr. L. P. Pett 1
Dr. F. F. Tisdall 1
Whole Milk Producers League . . 56, 65
67. 76
W.J. Wood 135
Export of Dairy Cattle 33, 34
Farm Products Control Act. The. ... 26
Farm Products Grades and Sales
Act, The 26
Farm Products Marketing Act, The
26, 63, 124, 137
Food and Drugs Act, The 24
Fraser Valley Milk Producers' As-
sociation 62
Grigg, Sir Edward. British Enquiry
by 4, 69, 109
Hamilton Milk Producers' Association 34
Hare. H. R 18.20,33
Herd Improvement 67
Kennedy. Hon. T. L.. Enquiry by.. . 3
Legislation relative to dairy industry 24
Licenses to distributors 6, 7, 11, 12
Marketing Schemes 27, 67
Cheddar cheese 124, 128
Cream 137
Great Britain 62, 68
Milk for Concentration 144
New York State 65
Melbourne, Australia 97
Meek, CM 6, 23
Milk and Cream Act, The 25
Milk Consumption in Ontario
For fluid trade 35. 36, 37. 103. 108, 117
119, 122
For all other purix)ses 35
Milk Control Act, Origin of 3
Sim.ilar legislation 4
Provisions of 5
as to licensing 8
As to transportation 71
Prohibition of co-operatives.. HI. 119
Milk Contro' Board
Administration by 5, 7, 11, 18
Appeal from 8
Authority to fi.x prices 6, 13 , 16
Composition of 5
Consumer representation 13, 22
General opinions and conclusions. . 18
Judicial Functions 8, 11
Licenses issued by 6, 12, 13
Origin of 4
P.^GE
Orders issued by 6
Policy of 4, 5, 7. 8, 11, 15, 16
Price Fixing by 6, 85, 144
StafT and duties of 6
Statistics required by 21
Milk Foundations 29, 122
Milk, Value of as food 1
Misner, Dr. E. G 48
Monopoly in distribution 104, 108
Montreal Milk Producers Co-opera-
tive 61
Mortenson, Prof. W. M 121
Municipal Legislation 27
New York State Marketing Scheme.. 65
New Zealand Royal Commission 90, 97
121
Niagara Peninsula 44, 51, 56
Northern Ontario 44, 51, 56
Ontario Cheese Producers' Associa-
tion 28, 30. 123
Ontario Cheese Producers' Associa-
tion Ltd 30, 128
Ontario Concentrated Milk Producers'
Association 28, 29, 141
Ontario Cream Producers' Associa-
tion 28,30, 133, 135
Ontario Creamery Association. 28, 30, 137
Ontario Whole Milk Distributors
Association 6
Ontario Whole Milk Producers'
League 6, 11, 28,29,31
Parliamentary Committee, 1932 60
Peddlers 6, 13, 82
Pett, Dr. L. B., Evidence of 1
Price Fixing 6, 16, 85, 88, 116, 143
Procedure of Royal Commission 1
Producer-Distributors 6, 13. 82
Profits of Distributors. . 83. 90, 103, 114
Public Health Act, The 25
Public Hearings 2
Public I'tilitv for Milk Distribution 110
120
Quantity discounts 97
Quebec Dept. of Agriculture 55
Quota System 49
Recommendations as to— -
Milk Control Act and Board 18
Cheese Production 130
Cream and Butter Production .... 140
Fixed Consumer price 106
Milk for Concentration 146
Milk for school children 112
Producer Prices 66
Subsidies HI
ONTARIO ROYAL COMMISSION ON MILK
157
PAGE
Transportation 78
Roberts. A. Kelso, K.C., M.L.A ... 117
School Children, milk for 112
Silverwoods Dairy Ltd 105
Statistical Data 21
Subsidies,
Cheese 125
Cream 134
Fluid Milk 103. 111. 118
Surplus Milk 51. 56, 59
Testing of milk 57
place of 58
Tisdall, Dr. F. F., Evidence of 1
Toronto Milk Transport Association . 75
Toronto Milk Transport Committee
15. 71
Trade Associations 17
Transportation,
Commercial Vehicle Act 26, 71
Co-operative 76
Costs of 75
Cream 135
Milk Control Act, regulations 71
PAGE
Milk for concentration 143
New York State 78
Organized Markets 72
Rates and volume — Toronto milk
shed 73
Routes, value of 72
Study by Ontario Dept. of Agricul-
ture 73
Waste in 73. 135
Twin City Milk Producers' Associa-
tion 59. 62
Uniformity of Accounting 19. 21. 90
U.S. Department of Agriculture. Sta-
tistical Data 22
Value. Ontario Milk Production 1
of milk as food i
Wage levels, urban 37
Wage and Labour Costs 102
Wel.ington, New Zealand 110. 121
Wholesale Sales. Ontario 89
Witnesses. Number and list of 2
Womens' Institute, Carleton County
Zoning 97
APPENDICES
to
ONTARIO ROYAL
COMMISSION ON MILK
[A]
INDEX TO APPENDICES
No 1 — List of witnesses wlio appeared before the Commission and persons and organ-
izations who filed briefs.
No. 2 — Transcript of evidence of Dr. F. F. Tisdall and Dr. L. B. Pett.
No. 3 — Number of licenses issued 1934-46 by Milk Control Board.
No. 4 — Original Milk Control Act and Amendments to 1937.
No. 5— Consolidated Milk Control Act and Amendments to 1947.
No. 6 — Schedule of Price Fixing Orders issued by Milk Control Board 1934 to 1946
No. 7 — Summary of recovery as a result of bonding of distributors.
No. 8 — Statistical material Chicago Marketing Area.
No. 9 — By-law 2990 City of Brantford. to regulate unlicensed production, sale and
distribution of milk.
No. 10 — Local branches of the Ontario Whole Milk Producers' League.
No. 11 — Brief of dairy farmer's wife, Carleton County.
No. 12 — National income and wages in Canada, index of employment Hamilton and
Ontario, and average wage rates in Ontario 1939 and 1946.
No. 13 — Details of formulas developed for calculating producer costs.
No. 14 — Form of dairy cost survey used by Royal Commission on Milk.
No. 15 — Supplementary brief Ontario Whole Milk Producers' League.
No. 16— Milk Control Board Order 39-15, as amended by 39-16, re Toronto market
transport control.
No. 17 — Accountant's report on milk transportation.
No. 18 — Accountant's report on distributors.
No. 19 — Summary of comparison of fluid milk sales, retail and wholesale, Ontario, 1946.
No. 20 — Record of licenses in markets of Toronto, Hamilton, Windsor, Ottawa, Kirk-
land Lake and Timmins.
No. 21 — Survey as to consumption of milk in Toronto by income groups, preferences
and reactiors to price increase.
No. 22 — Extract from report of Royal Commission on Milk, New Zealand. 1946.
No. 23 — Accountant's report on creameries.
No. 24 — Accountant's report on condensaries.
No. 25 — Accountant's report on cost of whole milk production.
No. 26 — Illustration of methods which may be used in calculating certain milk pro-
duction cost items.
No. 27 — Whole milk production costs in Hamilton and Niagara district as submitted
by W. D. Black.
No. 28 — Suggestions toward ascertaining production costs.
No. 29 — Accountant's report, survey of cheese manufacturers.
[B]
APPENDIX 1
LIST OF WITNESSES WHO APPEARED BEFORE THE COMMISSION
AND PERSONS AND ORGANIZATIONS WHO FILED BRIEFS
Witnesses' Distri- Pro- Con- Trans-
Place Name butor ducer sumer porter Expert
Toronto
L Mrs. Lily Phelps x
2. A. Savage x
3. Mrs. E. Sanderson x
4. H. W. Emery x
5. A. A. McLeod x
6. S. Smith x
7. C. Coburn x
8. Mrs. H. Murray x
9. T. A. Sutton x
10. Mrs. F. H. Sanderson x
n. C. Kidd X
12. J. Eldon X
13. Mrs. J. F. Cowan x
14. W. L. McKinnon x
15. R. H. Saunders x
16. Dr. F. F. Tisdall x
17. J. Aird X
18. H. G. Webster x
19. H. T. \^Ti?ht X
20. D. R. MacQuarric x
21. H. Christenson x
22. .T. E. Houck x
23. W. W. Cosbum x
24. E. M. Cockin x
25. A. S. Thurston x
26. C. Rosebrugh x
27. C. Bums x
28. W.Storey x
29. C. Hooper x
30. J. H. Jose X
31. G. Rouse x
32. Dr. L. C. Swan x
33. A. E. Coleman x
34. R. F. Lick x
35. E. H. Clarke x
36. F. Mclntvre x
37. E. Kitchen x
38. V. S. Milbum x
39. W. Wood x
40. J. W. Hanson x
41. W. R. Aird x
42. Miss N. Tcuchbum x
43. M. D. Warner x
44. J. H. Duplan x
45. R. McMaul x
46. J. Goodman x
47. J. C. Hav X
48. C. M. Meek x
49. H. L. Cummings x
50. W. H. Wilmot X
51. J. S. Beck X
52. Ward Hallman x
53. C. E. Lackner x
Fort Arthur
51. D.H. Coghlan x
55. J. D. Gibb x
56. J. E. Ouinn x
57. L. J. Hare x
I 1 !
APPENDIX 1
Witnesses' Distri- Pro- Con-
Place Name butor ducer sumer
Port Arthur — continued
58. W. B. Lowe x
59. Jorgen Brohn x
60. A. T. Oliver x
61. F. N. Carter x
62. Alban Beman x
63. E. J. Edmond x
64. J. McLeod
64. F. Scollie x
65. H. Lovelady x
66. O. Bingham x
67. Grace 0;a x
68. Gertrude Miller x
69. W\ Arthur x
70. W. Klomp x
71. L. H. White x
North Bay
72. Mrs. L. Memaghan x
73. M. Frank x
74. M. E. McLeod x
75. M. Abramson x
76. T. Seguin
77. O. Archer x
78. G. W. Ketter x
79. D. Quarrell x
80. D. Rousseau
81. W. R. Peters
82. A. E. Rigg...
83. A. Helmer
84. R. Beithartz
85. E. Laro:Que
Belleville
86. S. L. Joss
87. C. H. Ketcheson
88. E. E. Finkle
89. E. Masse
90. N. McCoutrey
91. G. Graham x
92. S. Graham x
93. K. D. Moncrieff x
94. J. F. Tranerton
95. L. H. McCaul
96. J. I. Ballantvne
97. W. O. Coon
98. B. Crank
99. B. R. Baxter
Ottawa
100. Mrs. M. Whiteley x
101. Mrs. E. White x
102. W. J. Aheam x
103. Mrs. E. Pritchard x
104. B. H. Pratt x
105. K. Dowler x
106. D. McAllister x
107. Dr. L. B. Rett
108. Dr. E. F. Johnston
109. W. B. Younghusband x
110. H. J. Clark x
111. F. J. Re\Tiolds X
112. H. Maloney x
1 13. J. F. Casselman x
114. A. Smith x
1 15. S. A. Lowrev x
116. H. E. Durant x
117. L. R. Thompson x
Trans-
porter
Expert
APPENDIX 1 ,_ .'
Witnesses' Distri- Pro- Ccn- Trans-
Place Nan:e butor ducer sumer porter Ex[>< 1 1
Ottawa —continued
118. J. M. Arkell x
119. Dr. J. Vanderleck - x
120. S. F. Checkland x
Windsor
121. Mrs. C. W. Beaumont x
122. Mrs. A. Molenko x
123. W. E. Holder x
124. A. Burrell x
125. M. C. Dalton x
126. J. R. Shuel x
127. W. McCormick x
128. J. F. Thomas x
129. Mrs. D. Nolan x
130. A. E. Gignac x
131. L. Cummings x
132. A. Douglas x
133. A. W. Ballentyne x
Hamilton
134. Mrs. M. Berendt x
135. N. A. Fletcher x
136. S. W. Lawrence x x
137. W. H. Mason x
138. G. H. Bethune x
139. .1. Drysler x
140. R. Emslie x
141. W. D. Black x
London
142. G. D. Lang x
143. C. J. Dance x
144. F. Way x
145. F. Revell x
146. D.J. Fletcher x
147. J.C. Robb X
148. L. Robb x
149. Mrs. Lucy Cole x
150. C. R. Shackleton x
151. W. A. Shannon x
152. D. Hart x
153. A. L. Dust x
APPENDIX 1
BRIEFS
-fcJ U^ CJ 1-
5 "^ P 2
ri cj C n.
Place and Name t^ o <= ^ o.
• « u. O v-i X
Toronto G cu O H W
1. The Ontario Milk Distributors' Association x
2. The Ontario Co-operative Union x
3. Valley View Dairy x
4. The Toronto Milk Distributors' Association. ... x
5. The Borden Company Ltd x
6. Dominion Dairies Ltd x
7. The Ontario Concentrated Milk Producers'
Association x
8. The Ontario Cheese Producers' Association x
9. The Ontario Whole Milk Producers' League .... x
10. The Ontario Cream Producers' League x
n. The Ontario Creamery Association x
12. Brief — Rural Housewife —
(Mrs. T. D. Cowan, R.R. 3, Gait) x
13. United Automobile-Aircraft -Agricultural
Implement Workers of America — District
Council 26 x
14. The Co-operative Commonwealth Youth
Movement — Ontario Section x
15. The Co-operative Service of Toronto x
16. The Housewives' Consumer Association
(Toronto) x
17. Ontario Committee of the Labour Progressive
Party x
18. Scarboro Ratepayers Central Executive
Committee x
19. The Co-operative Commonwealth Federation —
Ontario Section x
20. The Consumers' Federated Cx)uncil x
21. The Ontario Federation of Labour x
22. The Council of City of Toronto x
23. The Associated Milk Foundation x
24. Consumers — St. Patrick's Riding —
(Submitted by A. Kelso Roberts, K.C., M.L.A.) x
25. The Toronto Milk Transport Association x
26. Solicitor to Department of Agriculture —
James C. Hay x
27. Dairy Branch — Department of Agriculture x
28. Milk Control Board of Ontario x
29. The Shareholders' Institute
Port Arthur
30. The Lakehead Confectioners' Association x
31. The Kenora and Dryden Districts — Milk
Producers x
32. Producer-Distributors of Thunder Bay x
33. Brief submitted by Mr. D. H. Coghlan of Port
Arthur — a consumer x
34. Port Arthur and Fort William Trades and
Labour Councils x
35. Consumers of Port Arthur x
36 Port Arthur Home and School Association x
North Bay
37. The Workers' Co-operative of New Ontario x
38. The Kirkland Lake Ladies Auxiliary of the
International Union of Mine, Mill and
Smelter Workers' Union, Local 77 x
39. Miss J. Macleod, Consumer, Kirkland Lake .... x
APPENDIX 1
O U w
■^ ^ ^ bi
I i i I r:
Place and Name | "§ c I 1.
North Bay — continued Q 2^ 0 H a
40. Ninety Patrons of the Glanworth Cheese
Factory x
Ottawa
41. The Ottawa Dairies — General Brief x
42. Central Dairies Ltd., Ottawa x
43. Highclere Dairy, Ottawa x
44. Clark Dairy Ltd., Ottawa x
45. Ottawa Dairy Company ; Division of Borden's
Ltd.) X
46. Brief submitted by Rural Housewife — Mrs.
John Pritchard, Ottawa x
47. Cx)nsumers of the City of Ottawa x
48. Brief presented by Veterinarian — E. J. Johnson. x
Windsor
49. The Borden Company Ltd., Walkerside Division x
.50. The Essex Milk Producers' Association x
5L Survey of Costs — Lammermoor Farm —
Courtright, Ontario- W. L. McKinnon x
52. The Housewives' Consumer League of Windsor.. x
53. The Municipal Council — City of Windsor x
Hamilton
54. The Hamilton Co-operative Cream.eries Ltd. ... x
55. Prospect Dairy Limited x
56. City Milk Company Ltd., Hamilton x
57. Silverwoods Diaries Ltd., Hamilton and General x
58. The Hamilton Milk Producers' Association x
59. Milk Production Costs in Hamilton and Niagara
Falls District (W. D. Black, Esq. ) x
60. Dairy Farmers' \\ives of Hamilton District x
6L Municipal Council of City of Hamilton x
62. Submissions by organizations, Niagara Falls, Ont. x
63. Consumers of City of St. Catharines x
64. Brief presented by \eterinarian Dr. L. C. Swan,
St. Catharines >
London
65. The Ex-Service Men's Wives. Mothers and
Guardians Association. London, Ontario x
66. London Citizens Milk Price Protest
Organization x
67. Consumers of the Citv of St. Thomas x
APPENDIX 2
TRANSCRIPT OF EVIDENCE OF DR. F. F. TISDALL AND DR. L. B. PETT
Dr. F. F. Tisdall
VOLUME XXXI
TORONTO, ONTARIO
(SECOND SESSION)
1st February, 1947.
— The Commission resumed at 10:00 o'clock, a.m.
MR. MATTHEWS: As you know, sir, we have only one witness this
morning. Dr. Tisdall, who has been good enough to come.
DR. F. F. TISDALL, Sworn,
EXAMINED BY MR. MATTHEWS:
Q. Dr. Tisdall, you are a medical doctor?
A. Yes, sir.
Q. And a graduate of the University of Toronto.
Q. And you are practising here in Toronto now?
A. Yes.
Q. And I understand you have a very close connection with the Sick
Children's Hospital?
A. I am on the staff of the Sick Children's Hospital.
Q. I also understand you have for some time specialized on the subject
of nutrition?
A. Yes, sir.
Q. And that you are the chairman, or a member of a good many com-
mittees. I can't remember those committees and I wonder if you would
name them for me?
A. Well, I am chairman of the Committee on Nutrition of the Canadian
Medical Association; chairman of the National Committee on Nutrition of
the Canadian Red Cross Society; a member of the Committee on Nutrition
of the Federal Department of Health and Welfare, Ottawa; a member of
the Food and Nutrition Board of the National Research Council of Wash-
ington; and a member of the Advisory Committee on Nutrition of the Food
and Agricultural Organization of the United Nations.
Q. I understand you were quite recently in Copenhagen for the Food
Conference?
A. Yes.
Q. How long ago was that?
A. In September.
O. Doctor, I understand you had the opportunity of reading the evidence
of Dr. Pett, which he gave in Ottawa last December?
A. Yes.
Q. Are you in general agreement with what he said?
A. Yes, sir.
Q. Did you find any part of his evidence with which you disagreed?
A. If I did it was only on very minor points, and I would say in general
I was thoroughly in accord with what he said.
Q. And you also had an opportunity of examining these two charts which
Dr. Pett gave us?
A. Yes.
Q. And you do not disagree, I suppose, with any information disclosed on
these charts?
A. I must say I didn't examine them with the idea of saying I agreed
with everything, because I don't remember. I only examined them in a
general way.
THE COMMISSIONER: Did anything strike you as being out of line, is
that a fair way of putting it?
A. No, there was nothing out of line.
[6]
APPENDIX 2 7
MR. MATTHEWS: Dr. Tisdall, we have had a great many briefs sub-
mitted to this Commission, and almost invariably they start off by speaking
of the vital necessity of milk as part of our diet, and the reason we asked
you to come here this morning, is to give us your opinion on that state-
ment, and give us what you can of the value of milk as a food.
A. To do that, I have to take a moment, with your permission, to tell you
the composition of milk, which you probably know, the composition from
a nutritional standpoint.
THE COMMISSIONER: You just go ahead and say what you feel you
want to.
A. Milk contains approximately 3^ per cent fat, approximately 4 per
cent carbohydrates or milk sugar, and about 31/2 per cent protein. In
addition, it contains a large number of vitamins and practically all the
minerals essential for life with the exception of iron and perhaps iodine,
depending on the pasture. It is the most perfect single food we have today,
there is no other single food that contains as many nutrients essential to
life as does milk.
Now we want to know if all these nutrients can be replaced by other
food sources, because if they can be replaced, and replaced economically,
then milk is not on any pinnacle, because we could simply take perhaps
three or four other foods and replace it, but I would say from our studies,
our respect for milk goes up.
Now, considering the various nutrients, and we must have as a back-
ground the fact that we need between 35 and 40 individual nutrients to
live, and if any one of those is taken out of your diet or mine, first of all
health is impaired, and if it eventually goes on long enough we die.
Now, considering it on that basis, and I am not going to run through the
whole 35 or 40 this morning, I will just pick out a few. We will take first,
fat. The fat in milk can be readily replaced by fat from other sources, and
I will take this opportunity of saying without being asked, that from the
standpomt of setting the value of milk, the economic value of milk on its
fat content is completely wrong. From the standpoint of the desires in
your household and mine, it is all right because we like fats.
MR. MATTHEWS: Like the taste?
A. We like the taste. This morning I had some cream on my cereal. I
would have been a little upset if I had had skim milk. Nutritionally there
was no particular need for me to have that cream, that is what I am
bringing out.
Secondly, the carbohydrate or milk sugar can be replaced very readily
by much cheaper sources, so we are not concerned with milk from its fat
content or carbohydrate content. Its protein content is an entirely different
story because the protein is what is termed animal protein of the very
highest nutritional order.
THE COMMISSIONER: Is it contained in cream?
A. No. there is practically none; the higher the cream content the higher
the fat content; and the lower the protein.
Q. Cream is largely fat?
A. Yes.
Q. What else?
A. We can say this, that cream is milk with a fat content up to 18 per
cent, or whatever the fat content is. There is certainly some milk sugar
in it and protein. You simply have to look at it as milk with fat in it,
and as the fat content goes up, the total of the others goes down.
MR. MATTHEWS: I think Dr. Pett said H ^''as ? ^-ource of Vitamin A?
A. Take the fat out of milk and you take the Vitamin A. I was not
talking about Vitamin A — I was talking about fat, carbohydrates, and now
protein, and protein is a very high quality and very valuable food.
Q. Of course we could get that protein from other foods?
A. We could get protein of equal quality from other foods.
Q. What sort of foods?
A. Taking the more common ones, meat, eggs, poultry and fish.
THE COMMISSIONER: How about cheese?
A. Cheese is milk.
Q. You say it has the same protein content?
A. Yes, cheese is the fat and protein of milk. The only difference has
been to remove the fluid and some of the soluble things as well, such as
some sugars and also some proteins that are soluble that won't be precipi-
8 APPENDIX 2
tated in making the curds. We regard chieese as almost the same as milk,
not quite.
Q. Not quite as good?
A. No, because you remove some of it; roughly one ounce of cheese
is equivalent to 8 ounces of milk in most things — not all things. Now
certainly milk does not have its high position in the nutrition world entirely
on protein content becauss protein of a similar grade can be obtained
elsewhere, although for a young infant and young child it does occupy an
unique position because you cannot feed a month old baby a piece of
beef steak and other things of that nature as readily as you can milk, but
from the standpoint of the older child and adult, the protein in milk,
although it is extremely valuable, and a very important factor in its
nutritional value, it is not indispensable.
Now, when you get down to the next group, the vitamins, you find that
milk is a very good source of Vitamin A, and to repeat again, Vitamin A
is fat soluble, therefore, if you remove the fat you remove the Vitamin A.
Milk is not unique as a source of Vitamin A as you get Vitamin A in many
other things. You can get a precursor of Vitamin A, that is carotene, and
when it is eaten it is acted on in the body and divided into or changed into
Vitamin A chemically — and from a nutritional standpoint, if you eat a sub-
stance rich in carotene, you will never suffer from a Vitamin A deficiency.
Compared with milk, 16 ounces of milk will give you 600 international units
of Vitamin A, Sj/^ ounces of carrots will give you 12,000 units, sweet potatoes
6,000, squash 4,000, and turnips 2,500. I do not need to give you any other
illustrations to show you the unique value of milk is not in its Vitamin A.
Also it is not on account of its thiamine content, which is one of the
members of the B complex, that milk is unique nutritionally.
THE COMMISSIONER: You talk about milk giving 600 units of Vitamin
A? A. 16 ounces of milk.
Q. What fat content is that milk?
A. That could be the whole milk, roughly SVz per cent, and if you cut
your milk down to 2 per cent you have to reduce it by that proportion, and
as you take out the fat, if you get it completely fat free, you have no
Vitamin A left. It is all fat soluble.
MR. MATTHEWS: Is thiamine. Vitamin B, also a fat soluble?
A. No. I suppose I shouldn't correct a statement made — it is Vitamin B-1.
Q. You correct anything there at all.
A. There are 9 or 10 members of the B group and thiamine is one.
Q. As a matter of fact on that chart it is B-1 and I misread it.
A. Yes, because there are nine or ten more subdivisions of the B
group, and thiamine, which is essential to life — and lack of thiamine
incidentally caused more deaths in the world before this war than any
single disease. Beri-beri in the Far East is caused by lack of thiamine.
They polish the rice and take off all the thiamine, or most of it, and that
is the cause of literally hundreds of thousands of deaths in the Far East,
and it is well known in medical literature there are more deaths or were
more deaths before the war due to beri-beri, than any other disease in the
world.
Q. If these people could be given a constant diet that includes milk, this
condition will disappear?
A. One of the recommendations of the Food and Agricultural Committee
of the United Nations is, at the earliest possible moment the milk supply
of those nations should be increased, and if possible the waste of skim
milk in the nations that are rich in milk, waste from the standpoint of
human consumption, that is being used for animal food or other purposes,
should be suitably processed and distributed to those countries.
Q. That is made into powder and shipped over there?
A. Yes. Now milk is a very fair source of thiamine, it isn't a rich
source, it is a very fair source. In our scheme of things it supplies an
appreciable amount of thiamine.
Now you come to the next vitamin we are concerned with and you get
an entirely different story, and that is riboflavin or Vitamin B-2, and I
am going to take you back for a moment to the war years and tell you of
some of our work with the Royal Canadian Air Force on riboflavin.
Q. That is the stuff that affects the eyes?
APPENDIX 2 9
A. The lack of riboflavin can cause the following eye symptoms, and
1 would like you to think if you were a pilot in a plane, defending our
country, over the Atlantic, as our boys did, and your life and the life of
your crew depended on your acuity of vision and so on — the symptoms
that develop are a burning sensation under the eyes, a sandy sensation
under the eye lids, dizziness, headaches and lack of visual acuity.
In examination of our boys down on the east coast, back in the
'early days of the war, our air crew, we found that 75 per cent
of the boys examined had two or more of those symptoms, and their
answer was that "Sure, you cannot go out over the Atlantic for 12 hours
or 18 hours at a lick and not come back without your eyes being tired,
having a bit of headache, a sandy sensation under the eyes and watering
of the eyes, and other symptoms." They took it for granted. Yet, when
we gave those boys additional riboflavin in two months time 95 per cent
had either complete disappearance of these symptoms or marked improve-
ment, compared to only 10 per cent who were given dummy capsules and
thought they were improved.
That evidence was so important from a health standpoint when presented
to the proper authorities the milk ration of the Canadian armed forces
was raised to the highest milk ration of any armed service in the world,
that of 20 ounces per day. That was the milk ration of the Canadian armed
services, which was higher than the United States, which was higher than
Great Britain, and which was higher than any other armed service in the
world. We gave it largely but not entirely for its riboflavin content.
Q. Can we get that Vitamin B-2 from other foods?
A. The answer is yes, technically so, but if you wanted to get the amount
of riboflavin which is contained in a quart of milk you would have to eat
2 pounds of roast beef, you would have to eat 2 pounds of dried beans
which when they are cooked swell up quite a bit, you would have to
eat 2 1/2 pounds of fish, 4 pounds of cauliflower, or a dozen eggs, and those
are the better sources.
Q. All that sounds more difficult than drinking a glass of milk. A. I will
say so.
From a practical standpoint we can say that if under our Canadian
habits of eating we do not include in the diet each day the amount of milk
which we recommend we can assure you that in all probability you are
not receiving an amount of riboflavin which is essential for you to enjoy
the optimal level of health and efficiency. That is, in our opinion, one of
the unique features of our milk. It is essential to have milk in your diet
if you are going to receive an adequate amount of riboflavin, an amount
necessary for good health.
Q. What about calcium? Can we come to calcium at this point?
A. No. We will come to niacin. We have dealt with Vitamin A, and, to
conclude this part of it, milk is a very good source of Vitamin A,
but you can obtain Vitamin A from any coloured vegetable except perhaps
beets. There are many other sources that are richer than milk in Vitamin
A. It is a very fair source of thiamine. It also may be obtained elsewhere.
It is unique as being our best source of riboflavin, but it is not a good
source of niacin.
Q. Is it a vitamin?
A. It is one of the members of the B-complex.
Q. It has not a number?
A. No, it has not got a number.
Q. There is another way of writing it down?
A. No. It was referred to some years ago as the pellagra preventing
vitamin, a disease which we practically never see here in Canada, but
before the war there were over 100,000 pellagras in the southern United
States. The evidences of the disease are skin lesions in which they get a rash
and discoloration of the skin, gastro-intestinal symptoms in which they de-
velop diarrhea and are completely upset from that standpoint, and also they
are affected mentally so that they may go completely insane. When given
niacin the effect is most dramatic in that in 24 to 28 hours those people
who are completely off their heads are normal individuals mentally. But,
that is not a problem for Canada; we do not see pellagra here at all.
One point for your interest is that in the United States in the south their
10
APPENDIX 2
diet is largely corn and very low in milk. Even though milk is not very
high in niacin it is thought that the protein and other factors reduce the
requirement for niacin.
There is one other vitamin, ascorbic acid, or Vitamin C which you get
in our Canadian tomatoes, in our Canadian cabbage, in our Canadian turnips,
and in our Canadian potatoes. You get it in very large quantities in
imported citrus fruits and fruit juices. Milk contains practically none
of it, or a very small amount, so its value as a source of ascorbic acid is
negligible.
We end by riboflavin standing out on a pinnacle, milk being the most
practical source of this vitamin which is essential for good health and life,
itself.
You ask me about minerals. There are no less than 13 minerals which
are known to be essential for life. I will not bother you by going over
them. You know you need calcium, phosphorus for bones, iron for blood,
iodine to prevent goitre, sulphur to go in the hair and all the rest of it.
There are 13 in all. We do not need to worry about these, the whole lot;
we need to worry in our Canadian diet about three, namely, calcium, iron
and iodine.
Q. What is the last one?
A. Iodine. In countries the food of which contains very little iodine,
such as Switzerland, goitre was very prevalent and they put iodine in salt.
That is the reason to-day that so much salt in Canada is iodized, because
you will not develop goitre due to lack of iodine if you are taking iodized
salt. There is very little iodine in milk.
We get iron in manj^ foods. Milk is practically devoid of iron.
The third one with which we are concerned is calcium. I would say if
your diet does not contain an adequate amount of milk you are not getting
the amount of calcium which is essential for the optimal level of health —
not just an average level of health but the optimal. We need approximately
800 milligrams of calcium a day.
Q. What is that in quarts of milk?
A. It is approximately IV2 pints of milk — 30 ounces. 11/2 pints of milk
will supply one gram. Adults need 8/lOths of a gram. Children need more
than a gram, so we believe that from a national standpoint if we take the
per capita requirement of calcium for the nation for optimal health it
should be about a gram a day. 30 ounces of milk will supply this, or four
ounces of cheese will supply this.
Q. In normal everyday conversation I understand you usually speak of
IV2 pints for a child and a pint for an adult?
A. You are quite correct. iy2 pints for a child for calcium and other
requirements which are greater than for an adult. A pint for an adult.
Q- I understand you draw the line at about 21 years between children
and adults for this purpose?
A. We will qualify that by saying "for this purpose."
THE COMMISSIONER: Is the bone growth complete by 21 years
of age?
A. Not 100 per cent, but it is so close to it for the purposes of this discus-
sion of calcium I think we can reasonably set something in that neighbour-
hood as the age at which the calcium requirements are going down. The
highest requirements are with your adolescent children who are shooting
up a couple of inches or more a year.
MR. MATTHEWS: Where did the man, woman, and child 5,000 years
ago get calcium? They did not have dairy herds then.
A. I think we can give you the best answer to that having regard to our
studies of our Canadian Bush Indian who perhaps lived a little bit like our
ancestors did 5,000 years ago.
When they shoot an animal to-day, if it is a small animal they eat the
bones. If it is a large animal they chop the bones up and put them in a pot
and boil them for two or three days and gnaw on them the same as a dog
does. That is, they will chew on it and bite on it and get the marrow out,
and, along with the marrow, the calcium. We are, and dogs are carnivorous
animals. They get their calcium from bones. The Canadian Bush Indian
to-day gets his calcium largely from the bones he eats, and, although I was
not present 5,000 years ago, I think we could infer that our ancestors got
their calcivim the same way.
APPENDIX 2 11
Q. If I chew the bones in the stew do I get some calcium without eating
the bones?
A. You will get some fi'om the stew; but, do not forget, these people cut
those bones up and chew them with their powerfully muscled jaws. I have
seen them actually take a rabbit bone and chew it up the same as we could
chew something which was softer. They will actually eat it.
Q. A rabbit bone to them is like a piece of toast to us?
A. Getting over to where calcium can be obtained elsewhere, you will
note I said that milk is unique as a source of calcium. I say you can get
your gram of calcium elsewhere if you want it. You would have to eat 3
pounds of celery, or 5 pounds of cabbage —
Q. That last prospect is not very pleasant.
A. — or, if you are a good Scotsman and are fond of your oatmeal, you
will take 3 pounds of dry oatmeal, make it into a porridge, into a tubful,
and you will get your gram of calcium.
Q. Which I can get from IV2 pints of milk?
A. Or from 4 ounces of cheese; or, if you are an Englishman and are very
fond of your bread and roast beef you can get it by taking 7 pounds of
bread or 17 pounds of roast beef. You just cannot get an adequate supply
of calcium without including in your diet each day milk or cheese. Our
study since 1919 on this aspect of our work constantly increases our respect
for milk as a source of calcium.
WITNESS (Continuing) : Now, that, I think, has set out in a rather
lengthy form what many nutritionists believe constitutes the unique value
of milk from the standpoint of food intake in Canada. We cannot get an
adequate supply of calcium unless we take milk nor an adequate supply of
riboflavin unless we take milk. Milk contains an excellent source of animal
protein which is particularly well-handled by the young child, and also
contains adequate amounts of the vitamin thiamine, and many of the
minerals.
MR. MATTHEWS: Can you illustrate the importance of milk in our
diet by reference by parity of accomplishment of countries? Have some
countries healthier people and have they accomplished more than others
because they are on a higher milk consuming diet?
A. Yes. If you take a table showing the per capita milk consumption
of countries of the world and opposite that table place the accomplishments
of those countries, the position they occupy in world affairs, and also the
figures of longevity with respect to those countries, you will find a very
distinct correlation, because in the countries that are the higher milk
consumers we have the leaders in the world to-day: Canada, United States,
Great Britain, Norway, Sweden, Denmark, Holland, Germany, New Zealand
and Australia; those are the greatest milk-consuming countries to-day.
Incidentally we have not the figures on Russia.
Now, if you look at the other end you will find that the low milk-consum-
ing countries are such countries as China, India, and other countries that are
not as great factors in world affairs to-day as the ones I have mentioned,
and their longevity figures are very definitely away down. In fact, there
is a very close correlation between the per capita consumption of milk and
the longevity figures of those countries.
Q. Would it be fair to say that the Scottish theory that the British
Empire was built on porridge is mythical?
A. No; because nobody I know of eats porridge without a little milk on
it, even your Scotsman.
Q. I agree that I would not want to eat porridge without milk. Have we
finished with that aspect?
A. Yes.
Q. Apart from taste and flavour, which I presume anybody will agree is
largely a matter of habit, what would you say would be the optimum
butter-fat content of milk for normal every-day use?
A. For adults just the way it comes from the cow plus being pasteurized.
Raw milk is distinctly unsafe even on accredited herds, and I say that with
very personal knowledge because I am a farmer and have 28 head of
Ayrshire cattle; I would not think of allowing my family to drink raw
milk from my herd, although the barns and equipment are perfectly clean,
because pasteurization is essential. For the average adult the milk that
comes from the cow, which is 3V2 per cent fat, is best. If, however, you
12 APPENDIX 2
are not an average individual and are having digestive trouble, fat is the
most difficult element to digest.
Q. You speak of the way it comes from the cow?
A. 3V2 per cent fat.
Q. The way it comes from the cow, is, for all practical purposes, the
same as the way we find it in the bottle? A. Yes.
Q. And so for adult purposes you say the way we are getting our milk
now is about right?
A. The only way you can modify that, I gather, is to take the fat off.
Q. Yes? A. We have already said that the fat content of milk is not of
tremendous value and can be replaced by other sources of fat that are
cheaper, but it has great value because the Vitamin A is in the fat.
Therefore if you skim the milk you take off some of the Vitamin A, but
you can get over 12,000 units from a helping of carrots as compared with
650 units from 16 ounces of milk.
Q. What about children? What would be the optimum fat content for
them?
A. If we run across digestive trouble in children the first thing we look
for is fat as the cause, and nutritionists throughout Canada will not use
whole milk; they use whole milk with some of the fat taken off, say
3 per cent down to 2 per cent, and if you have a baby that is having
digestive upsets very frequently the procedure is to reduce the fat content.
Q. Then it is important that people should be able to get skim milk?
A. Yes, and you can take off the cream for father and give the youngsters
the skim milk; that is the way to get it.
Q. And that is as effective as any other way?
A. Certainly. If you get over into economics I must remind you that
I am a doctor and know nothing about economics, and would not care to
answer questions on the subject of milk from the standpoint of dollars
and cents. I am no authority on that; in fact, I can hardly understand my
auditor's reports, other than the money in the bank.
THE COMMISSIONER: Have you any money in your bank from your
farming operations?
A. I have paid out a great deal of money in connection with my farming
operations, but I have yet to receive any money from the farm to put in
the bank.
Q. That is what I suspected.
A. I gather that you are passing over to an economic problem; would it
not be better to skim off the fat and sell it at the high price it gets for
butter and use the very valuable partly skimmed milk. I am completely
ignorant of economics, because there are one thousand and one things that
are involved therein. I may say that that aspect of it has received study
from various groups who are aware of the economic aspect. It is a most
complex problem, and may change our whole dairy industry.
Q. Along the same line, the way milk is valued at the moment is by the
butter-fat test. Have you any suggestions as to say other tests? I think
the butter-fat test is used because it is handy and simple, and could be
universally applied. Before it was used I understand milk was sold by
volume?
A. I am sorry, sir, that I cannot answer that question; I have not given
any thought to it.
MR. MATTHEWS: Thank you very much indeed. Dr. Tisdall.
MR. SEDGWICK: I represent the dairies, doctor, and desire on their
behalf to express gratitude to you for your very valuable contribution.
I was so impressed by it that I thought my clients might like to have it
printed and give it wide distribution. I do not think the story you have
told us this morning should be confined to the minutes of this Royal
Commission.
THE COMMISSIONER: It may find its way into the report.
MR. SEDGWICK: I hope so.
WITNESS: May I point out to Mr. Sedgwick, and hope that he in turn
v.-ill point out to his clients, that we at the Hospital for Sick Children in
Toronto are the best salesmen they have got. Please remember that when
contemplating donations to the hospital.
MR. SEDGWICK: I shall certainly pass that information on, doctor.
APPENDIX 2 13
THE COMMISSIONER: I would like to express my thanks to you, too,
doctor. Your evidence has been most helpful.
—-Witness withdrew.
DR. LIONEL B. PETT, sworn:
EXAMINED BY MR. MATTHEWS:
Q. Dr. Pett, you are a medical doctor and also a doctor of philosophy?
A. That is correct.
Q. And at the present time you are holding the appointment of Director
of the Division of Nutrition in the Department of National Health and
Welfare here in Ottawa?
A. That is correct.
Q. And you have been kind enough at the Commission's request to
prepare two tables to show the nutritional value of milk, is that right?
A. Yes, sir.
Q. And I would like, Mr. Secretary, to have those filed as two exhibits.
— EXHIBIT NO. 14: A comparison of the nutritive values of skim milk,
whole milk, 3.0% fat, whole milk, 3.5% fat, prepared
by Dr. L. B. Pett.
—EXHIBIT NO. 15: Table prepared by Dr. L. B. Pett showing the amount
of energy units (calories) the consumer of milk gets
for one dollar.
Q. Now copies of these two exhibits have been distributed as far as
they will go, and I would like you to direct your attention first of all,
doctor, to the bigger picture, the one that shows the greater detail, and I
take it that this exhibit deals with all the nutritive values contained in a
quantity of milk, is that right?
A. Yes, not only of milk, since nutrition specialists like myself classify
all foods in terms of these particular subdivisions, and perhaps one or two
others; in other words, this is the common denominator by which all foods
can be judged nutritionally.
Q. And are some of these figures more important than others, that is
to say, would you agree with me that the protein division is perhaps more
important than some of the others?
A. Well, in nutrition we divide foods rather sharply according to whether
they provide energy alone, of which I think a good example would be
sugar, since it contains energy or heat value alone, but no other nutritional
value. On the other hand, all the other subdivisions such as are listed here
have very specific physiological value in the body, of which perhaps protein
is the chief and most valuable. It originally was given the name protein
because that name denoted its meaning, it is the prime substance of
importance to living beings.
Q- And am I right in thinking that the calories are in the category of
providing the energy you speak of?
A. That is right, a calory is a unit of heat, which is a method of measuring
either heat or any other form of energy.
Q. Now comparing the value of skim milk as against the other two types
of milk containing respectively 3 and 3.5 per cent butter-fat, I take it that
in protein the skim milk is just as good as the other two?
A. That is the meaning of this chart.
Q. And of calcium, phosphorus, iron, Vitamin "A", thiamine or Vitamin
"B-1", riboflavin, niacin and ascorbic acid, the same is true?
A. The same is true in all these items.
Q. Now, I see in the case of carbo-hydrate per volume, the skim milk
is better than the other two?
A. Yes. Carbo-hydrate is another term in this case for sugar and there
is a slightly larger amount in a given volume of skim milk. I would hesitate
to say that that is a very significant amount, but it certainly is not less than
milk containing butter-fat.
Q. Then, the three headings under which skim milk doesn't quite
measure up are calories, fat and Vitamin "A"?
A. Yes.
Q. Would you comment on that?
A. As I said, foods have to be distinguished as to whether they supply
calories for energy or whether they supply other nutritional values. Fat
14 APPENDIX 2
primarily contributes calories for energy and nothing more, with the excep-
tion as shown quite clearly in this graph of what is known as Vitamin "A".
However, I might say in passing that Vitamin "A" is not usually nutrition-
ally sought in milk. It is there and it is very useful to be there, but the
protein, riboflavin, calcium, phosphorus in milk are all nutritionally much
more important factors than the Vitamin "A".
THE COMMISSIONER: Are there many other sources of Vitamin "A"?
A. The richest substance, sir, is ordinary carrots and they are common
and prevalently used and are relatively cheap.
MR. MATTHEWS: You do not feed milk to get a supply of Vitamin
"A", in other words?
A. No.
Q. Would I be right in saying that the calories and fat can be quite
readily obtained in other food?
A. Yes, obviously we get energy, that is calories, from almost all other
foods, but some more than others. Particularly in Canada cereals make
our great contribution to calory requirement, not fat requirements but
calory requirements. Fat is an essential part of the diet but it can be
obtained from a number of other products, notably meats.
Q. Then you have attempted to sum that up in the second exhibit?
A. Yes. The second exhibit illustrates the use of two kinds of units that
have been in use in our department for some time, again to reduce all foods
to some common denominator, either energy units on the one hand or what
we call nutrition units on the other. The nutrition units take into account
the minerals, calcium and iron, and all the vitamins. In this particular
chart, in fact in all these cases, we distinguish and we keep these two things
separate, energy and other nutritional values, because you can get, as I
said before, energy from a variety of things and nutritional units from
other things. However if you wish it is possible to get some idea of the
total contribution in return for the consumer dollar by adding these two
together. You can add together the two black lines on this chart and you
get a total of 192, you can add together the white ones for 3% butter-fat
milk and you get a total of 152 and you can add together the barred ones,
3.5 butter-fat milk and you get 157. I would call your attention to those
last two totals, 152 and 157, yet there is only one-half per cent of butter-fat
difference. In other words, most of the nutritional value, energy value,
health value, lies in the solids — not fat — in the milk.
Q. So looking at that exhibit the consumer is getting a lot more for his
or her dollar in skim milk than any other type of milk?
A. Per dollar that is correct.
Q. I take it that milk is considered a very important food product more
because of its content in minerals and protein and other things rather than
its content of calories and fat?
A. I would say that most emphatically, yes. Nutritionally speaking and
from the health standpoint the fat content of milk is not the most important
factor.
Q. Now, doctor, before this Commission we have heard a good deal of
evidence which indicates quite clearly that milk is very often chosen by
the consumer on the basis of the butter-fat content, and, in fact, that has
been carried so far that to-day the price of milk that is paid to the producer
is based on the butter-fat content of the milk rather than on some other
gauge. What comment would you make on that?
A. Nutritionally speaking I would say it is an unfortunate trend.
Q. And have you any thoughts as to how that can be explained?
THE COMMISSIONER: I suppose it is an easy way of measuring.
A. I think that is the basis of it, Mr. Commissioner, it is an easy, con-
venient measurement, and these others are not nearly as convenient.
Q. It would be almost impossible to expect anybody but a chemist to
measure it?
A. That is right but the Babcock test has been the standard test over this
continent for many years.
MR. MATTHEWS: Looking at the fat value of milk would you like
to comment on its value in various age groups?
A. Yes, I wanted to mention one of the reasons, and only one, why I
consider unfortunate this trend to have milk evaluated generally or ex-
clusively on butter-fat content. In medical practice, particularly in the
early ages of children, a good deal of harm may be done by milk of too
APPENDIX 2 15
high a butter-fat content. This can carry through into a fairly old age
group. In other ages of course, that is to say the adolescent who is
vigorous and has plenty of vitality and expends a lot of energy, they need
all the butter-fat content you have in the milk, and they will eat bread
and jam and everything else you can place before them as well for their
energy requirements. Again in older adult groups there is medical experi-
ence to show that the ability to digest fat may materially decrease, and
that a digestive disturbance will result from the larger fat content in the
milk.
Q. Well, I take it from what you have said before that even in these age
groups where the calories and fat are more important, it is not a difficult
problem to find substitutes for these calories and fats in other food
products?
A. No.
Q. So looking at the whole picture, and taking into account all the age
groups, if you were to work out what you considered would be an optimum
butter-fat content, I take it it would be somewhere below 3.4 per cent?
A. I think it might be well below 3.4 per cent butter-fat content, but I
would like to point out that the actual setting of the standard for butter-fat
content of milk is not exclusively a nutritional consideration. There are,
I realize very well, other considerations involved, but there is no health
reason why it should be 3.4 per cent rather than 3.0, no nutritional reason.
Q. One of the other considerations you have in mind would be the matter
of testing, is that right?
A. That is a possibility.
Q. What other considerations did you have in mind?
A. Well. I think there is a generally demonstrated problem involved
which cannot be exclusively decided on the health basis. What it is, I am
not an expert and I cannot say, all I can say is that I do not think the
health value alone, the nutritional value, can be used to set a precise
figure that would be the best butter-fat content of milk at which to set a
standard.
THE COMMISSIONER: If you were setting it from a health stand-
point alone what figure would you put it at?
A. Without a good deal of further study I do not think I could set a
precise figure, I would just say it could be well below 3.4 per cent.
Q. I gather from your general attitude that you wouldn't put it below
3 per cent?
A. It might go below that but I would hesitate to say so.
Q. Somewhere in that range between 3 and 3.4 per cent?
A. The only thing is there is no health reason to put it at 3.4 rather than
at some lower value.
MR. MATTHEWS: In that consideration you are thinking of all age
groups whereas if we are thinking of some junior age groups, it might
very well be you could very well drop the butter-fat content from your
point of view down to a very small percentage?
A. For certain restricted age groups it might very well be below 3
per cent.
THE COMMISSIONER: Skim milk is used in infant feeding?
A. Not skim milk but lower fat content, something below 2 per cent.
MR. MATTHEWS: Is skim milk purchasable in Ottawa at 11 cents a
quart?
A. That is my information, yes.
Q. The result of this second exhibit of yours, doctor, is that a quart of
skim milk at 11 cents, is a better bargain than whole milk at 15 cents?
A. Nutritionally that is right.
Q. That is all?
A. That is all I can discuss.
EXAMINED BY MR. SEDGWICK:
Q. Doctor, isn't it a fact that by Federal law distributors are compelled
to sell milk that is not less than 3.2 per cent butter-fat content?
A. I don't know.
Q. Well, I am so informed and I wouldn't like the impression to get
abroad that we can, if we care to, sell skim milk or almost skim milk, and
it is just as valuable as whole milk.
THE COMMISSIONER: You sell skim milk, do you not?
MR. SEDGWICK: Yes, but we sell it as skim milk. We cannot arbi-
16 APPENDIX 2
trarily reduce the butter-fat content to 3 per cent or 2.5 per cent or any-
thing that suits us.
THE COMMISSIONER: There is nothing to prevent you selling skim
milk as such.
MR. SEDGWICK: Not without any butter-fat content whatever.
Doctor, with regai'd to these percentages, are they constant, is all milk
alike or does milk vary? Would the milk of one farmer have more calcium
and iron and riboflavin than the milk of another farmer?
A. Variation is a fundamental law of biology, and cows are no different
from humans or any other animal in that field. Certainly there is a
variation just as in butter-fat one cow of the same breed can give 3 per
cent and another up to 6 or 7 per cent, as I know in my own experience.
So you can get variation; but these are average figures. I wish to say very
definitely whereas butter-fat content from a given cow or herd may vary
considerably in its average from time to time, the calcium content tends
to be remarkably constant, that is the range of variation is very small,
because that is drawn out of the cow's own bones.
Q. I had in mind phosphorus content?
A. Phosphorus content may vary.
THE COMMISSIONER: But that is not created by the addition of
butter-fat? A. No.
MR. SEDGWICK: No, I wasn't considering that.
A. There is variation but if you skim all the butter-fat from any milk
the resulting analysis is rather remarkable for its consistency rather than
its variation. Milk is therefore one of our best foods, it is something you
can expect to get a certain amount of nutritional value out of.
Q. When you speak of the nutritional value you find, are you speaking
of the Ottawa markets or of all markets?
A. No, I am speaking of all analyses.
Q. Made by you all over Canada?
A. Not made by us personally, they are combined from all the figures
available. These figures are taken from a textbook compiled for Canada
giving the analyses that are most likely to be encountered in Canadian milk.
Q- Would the variable factor be great; for instance taking the phosphorus
which you say would be .42 grams per pound, have you any idea how
low that might fall or how high it might rise?
A. Specifically for phosphorus I don't know the full range but I suspect
that it would be not more than perhaps .38 to .44.
Q. And the iron, would that be variable?
A. No. Iron is rather constant.
Q. The Vitamin "A" I observe is almost absent in skim milk? A. Yes.
Q. And thiamine or Vitamin "B"?
A. That remains remarkably constant although it will vary. That gives
a figure of .16, and it will vary certainly from .14 to .18, perhaps even a
little wider than that.
Q. And riboflavin?
A. Yes, that varies, even more sometimes, but that is more dependent
on the breed, than it is within one breed. I am talking of milk throughout
the country as a whole.
Q. Depending on the breed of cattle, that is it?
A. Yes.
Q. And niacin, is that variable?
A. Not very much. All of them will vary as I have already said.
Q. Yes, I understand. I was wondering if there was any sharp vari-
ability?
A. I don't think any of them will vary, let us say, by 50 per cent or
something dramatic except your Vitamin "A" for obvious reasons as
given here.
Q. Shall we say 20 per cent or something less than that?
A. Yes, that is more the order, 10 to 15 per cent.
Q. Did I understand you to say that doctors prescribe milk with less
than 3 per cent of calory content or butter-fat content?
A. Not calory content, butter-fat yes.
Q. That is pediatricians prescribe it for very young children? A. Yes.
Q. Is that an alternative to homogenized milk or in lieu of homogenized
milk?
A. I don't think it has any relation to homogenization, it is straight
fat content.
APPENDIX 2
17
Q. With young children fat may be indigestible?
A Yes
EXAMINED BY MR. TREPANIER:
Q. To let us understand that, butter-fat being indigestible for children,
in the condensory trade in the preparation of infants food they remove a
large part of the butter-fat? A. Yes.
Q. For instance, Nestle's and some of these other brands of children's
food have the butter-fat purposely removed? A. That is right.
Q. And a child on a balanced diet can get along very well until the age
of three without any fat from milk, is that so?
A. I think that is rather a broad statement. As a matter of fact, gen-
eralizations of that sort are extremely difficult to make in medicine because
medicine is still an art and that means that you have to prescribe for
the individual case.
THE COMMISSIONER: There is a variation?
A. Yes, it varies with individuals. However, it is difficult to answer it in
that way; I am not quite sure.
MR. TREPANIER: You couldn't say up to what age it is preferable
to keep the fat out of the milk?
A. The best method of feeding infants under one year, or under nine
months is breast feeding, let us be clear on that, and even then sometimes
they must be fed some kind of mTlk. In many cases, sometimes as high as
©ne-half, they will do better on 2 per cent, and sometimes others will do
better on 5 per cent, so it is difficult to generalize. In a large percentage
of cases from the age of weaning or before that if they are bottle-fed, a
lower content of fat is a definite advantage. There are many infants, and
pediatricians believe at present they are actually increasing in Canada,
who cannot tolerate as large a fat content in the diet as used to be the case
in medical practice perhaps 30 years ago. Therefore, it is necessary to
reduce the fat content of the milk by some means or other, and there are
cases in my experience, even at 5 years of age, of still having to reduce it,
that is some fat has to be removed, reducing it perhaps to something below
the current market milk. Does that answer your question?
Q. That covers that point. Now, in the preparation of whole milk
powder and skim milk powder, of which there is quite a volume produced,
what have you to say as to the nutritional value of milk powder as opposed
to the value of fluid milk? Is there an appreciable difference between the
nutritional value of milk powder over whole fluid milk of similar fat
content? A. No.
Q. So from a nutritional standpoint we would be as well off if we used
milk powder of the fat content of our choice instead of using fluid milk?
A. Except for one factor, which is just as important in nutrition as any-
thing else, and that is shall I say acceptability, palatability, some one of
those phrases.
THE COMMISSIONER: Nobody has invented powdered milk that tastes
very well.
A. I must disagree Mr. Commissioner, if you will permit me. During the
war, in Canada particularly, for use in the R.C.A.F., there was developed
not so much the powdered milk itself but a method of handling it. It
was different, and I drank it many times in reconstituted form and you
couldn't possibly distinguish it from fresh whole milk. I have, of course,
talked to lots of fliers who have been on stations where it was not properly
handled and in those cases it wasn't the milk, it was the way it was
handled.
MR. McLEAN: Just one or two questions.
EXAMINED BY MR. McLEAN:
Q. In regard to the question of palatability, I think you will agree with
me, taken by and large, skim milk to the general individual is not as palat-
able as milk with average butter-fat content?
A. No, I can't agree, in our experience that is not quite true.
Q. Have you any members of your family? A. Yes.
Q. Were they started on skim milk?
A. Two per cent milk.
Q. And they are not used to anything else but that?
A. No, they have had other kinds of milk.
Q. They were started on two per cent?
18 APPENDIX 2
A. Since nine months anyway.
Q. You won't agree with me that skim milk is less palatable to the
general run of individuals than the larger butter-fat content milk?
A. I would prefer to separate it from the two boys in my family. I have
in my position as Director of Nutrition for the Department of National
Health been responsible for surveys of well over 10,000 different Canadians,
the results of which dietary studies I have, and I prefer to discuss those
statistics from that angle rather than from my boys.
THE COMMISSIONER: I think it is more varied. What did you find
there?
A. I can only record the facts in these cases, not opinions, as to whether
these people like skim milk. We did find across Canada a surprisingly large
use of skim milk. Almost invariably the cream to some extent was poured
off the bottle, and the result must be considered skim milk to some degree
01- other. Offhand I can't say an over-all figure for that because we have
it divided into regions but specifically the most recently tabulated area is
from the Maritimes, and that showed there must have been about one-third
following this habit.
Q. The habit of drinking skim milk or much reduced butter-fat?
A. Yes, much reduced.
Q. One of the things you are concerned with as a nutritionist is to
increase the consumption of the healthful food, milk? A. That is right.
Q. And do you feel that the reduction in butter-fat or the introduction of
skim milk more generally would not affect the quantity used? I want your
view on that.
A. Well, from our observations I don't know any reason why it should
reduce the amount of milk being used if there was a somewhat lower
butter-fat content, or indeed if it would increase the sale of skim milk.
Q. You don't think that children generally who had been accustomed to
drinking milk, or even adults, with butter-fat content, would shy away so
to speak from skim milk?
A. I have no doubt some will.
Q. I am afraid I may be affected by my own reaction to skim milk
compared to homogenized milk with a fairly high butter-fat content.
A. I have no doubt some individuals would shy away from it, but taking
the country as a whole I don't know any reason why any reduction in the
use of milk should result from a reduction in butter-fat standards.
Q. And you don't think its more general introduction would affect the
quantity of milk consumed if it was carried out as a health program and so
to speak sold to the public in that way?
A. No, not from the evidence on these charts which we have to go on
that milk is a most valuable food.
THE COMMISSIONER: It is cheaper and might increase consumption.
MR. McLEAN: It might very well do but I am thinking in terms of
children, and from my own limited experience I think they won't drink
skim milk whereas they will drink homogenized milk.
THE COMMISSIONER: They are just pampered, that is all.
MR. McLEAN: A program of re-education might be necessary, sir.
The minerals in milk come from the food a cow consumes, is that right?
A. Plus her own skeleton.
Q. Which in turn was built by the food she consumed?
A. Yes, but of course cows are shipped around the country and may have
consumed good food at one point and currently may not be as well fed.
Q. Do you know in fact in feeding cows and in growing grain for them,
there is a loss of the mineral content of the soil in growing the necessary
grain?
A. Yes, there is a slight loss.
Q. Which over a period of time must be replenished in oi'der to keep
your feed and grain equally as productive of these minerals, is that correct?
A. Yes, it might take a long time before it would need replenishment.
Q. You are not familiar with the problems in some areas where certain
minerals are missing from the soil, where in consequence your milk or beef
cattle are deficient in certain minerals?
A. I am quite familiar with this problem.
Q. That is a problem that does arise?
A. It is not very common in Canada.
APPENDIX 2 19
Q. Isn't it a fact that there are some areas in Ontario where it is lacking?
A. Iodine is lacking in certain sections. I may say in response to this I
don't know of any area in Ontario in which it has been proved that there
is lack of calcium in milk due to its lack in the soil. I would like to say,
Mr. Commissioner, we conducted an investigation about three years ago in
British Columbia in which there was a definite claim in this respect that
something in the milk was deficient, and the analysis didn't bear it out at
all, there wasn't anything wrong with their milk, and I don't know who
started the rumour, but it was most damaging to the producers at the time
and we were very glad to settle it when we finally got the facts.
EXAMINED BY MR. MEDCALF:
Q. Have you any figures concerning the use of skim milk in the Ottawa
market?
A. No.
Q. Do you know whether it is a fact that one must have a doctor's cer-
tificate in order to get skim milk here?
A. I do not think that can be true.
Q. I have just been informed that it is not true now, but I understand
that it was true at one time. I take it that as a nutritional expert you
would be opposed to any restrictions upon the purchase of skim milk by
the public? You would consider that the public should be able to buy as
much skim milk as they chose to buy?
A. From a nutritional standpoint, yes.
Q. And do you have any explanation of why there has been the trend
towards skim milk in the Maritimes?
A. I do not know whether there has been that trend.
THE COMMISSIONER: It is a very intelligent section of the country!
MR. MEDCALF: I take it that from a nutritional point of view you
are in favour of skim milk as a form of milk for purchase and consumption"'
A. Yes.
EXAMINED BY MR. SEDGWICK:
Q. We have been told that the milk sold in this market has, generally
speaking, 3.5 butter-fat content. Would it be fair to say that your opinion
is that about one half of that would make a good, palatable and nutritional
milk drink, that is, about 1.75 or 1.8 milk?
A. I would not answer that question for the Commissioner, and I will
not set a figure now. I have said there is no reason why it has to be as
high as 3.5 per cent, but to set a definite figure on a health basis is simply
not possible under the existing arrangements for protecting the public in
various respects. I would remind you, Mr. Commissioner, that the purpose
of setting a standard is to assure the public of good wholesome milk that
has not been tampered with in some way, and this is an administrative
detail that enters into the setting of a figure. Therefore the effect cannot
be stated solely on nutritional grounds.
THE COMMISSIONER: Also I suppose knowledge of nutritional
values is something that increases as time goes on, and what may be valid
to-day may not be necessary 10 years from now, is not that true?
A. To some extent, yes, sir.
Q. You cannot make too dogmatic pronouncements, because you may
make other discoveries that will modify your present opinion?
A. That is true.
MR. SEDGWICK: I was only thinking of the case that has been
presented to us here and elsewhere, the case of the mother of a large
family unable to pay 15 cents per quart for milk. It struck me that a
simple solution, and one of which you may approve, is that that mother
might buy a quart of skim milk for 11 cents and a quart of whole milk at
15 cents and mix them together and get a satisfactory milk for her family
and thus the problem might be solved. What do you say about that?
A. Nutritionally, I think it would be a good move.
EXAMINED BY MR. MATTHEWS:
Q. I am going to ask you a final question, although you may not be the
best person to answer it: We have been told here that a bottle of skim
milk at 11 cents is a better bargain than a bottle of whole milk at 15 cents,
and we have also been told that it is not necessary to have a doctor's
certificate to procure skim milk because it is readily available. Why are
the people of Ottawa not buying more skim milk?
A. If I venture an answer it would be a purely personal opinion, because
20 APPENDIX 2
I have no studies in Ottawa on which to base a factual report. My opinion
would be that there are several reasons: First, that the average housewife
is not even aware that she can get skim milk. Second, that there is in fact
some difficulty in procuring it. I have reason to believe that you have to
go directly to a distributing plant for it. There may well be other factors;
for all I know the people of Ottawa have very discriminating palates.
THE COMMISSIONER: Has there not been propaganda, if you like,
for years that people should drink good, rich milk, which meant that it
was creamy, and that these discoveries of medical science take quite a
while to spread in the popular mind?
A. Yes.
Q. There is a lag, and it may take some years to catch up.
A. Yes. The general public, I think, are not familiar with the fact that
by far the best amount of nutritional value of milk does not lie in the
butter-fat.
Q. I would think that is true.
A. Yes.
THE COMMISSIONER: Thank you very much, doctor.
MR. MATTHEWS: Sir, I have received a request that Mrs. Marion
Whiteley should re-enter the witness box and say something on this
particular subject.
THE COMMISSIONER: Certainly.
APPENDIX 2
21
EXHIBIT NO. 14
P C0MPRRI50N OP skiim milw:
TUE WUTPITIVP VQLUCS OC ^"°^^ MiLk:.5 0%FRT
CPL0RIC5
5 O *A FRT
fe
SKIM, 161 CnuOR\E«, PtR POUND
WHOLE. Z75
PROTEIN [ ^o%FRT
CPRBO
SOM. 15^ GeOKA^ PER POUND
\AiUOLE, 15^
WMOLC. IS'S*
SK\M, OS GRRM<> PCK POUND
WHOLE, 15 6
\WWOUE, 15 3
SICIM. 2.5 a &RRMS PER POUND
*,0 7oF«T I WHOLE, Z22
MYDRQTE [^ . 5 v. f.tN\\\\^^ whole, z.iz
S<lM, 0 5A GROMS PER POUND
VWHOLE, 0 54-
WHOLE. 0 54
SKIM , 0 42 GRRMS PEC POUND
WHOLE. 0 4i
WHOLE. 0 4Z
SK.1M, 0 5 MILLIGRRMS PER POUND
WHOLE. 50% FRT, 0 5 -
WHOLE, 5S7oFRT, 0 ? ■•
SKIM. ZO UNITS PE!^ POUND
WHOLE. 610
WHOLE, IZO
SMM. OIG M\UL\GRRMS PER POUND
WHOUE. 5 0 7„FRT. 0 16
WHOLE. 5 5 7»FnT. 0 16
SKIM . 0 8 M\LUGRF»MS PER POUND
WHOLE, ?0%FnT. 0-8
WHOLE. SS'/oFRT 0 8
SKIM , 0 S MILLIGRAMS PER POUND
WHOLE, 5 07oFHT. 0 5 ••
WHOLE, SS-yoFRT 0 5
S,K(M, 6 M\LL\GRRMS PER POUND
WHOLE, 3 0%FnT, 6 •
WHOLE, SS'yoFnT. fe ■■
VITfiMlN P
THlflMlNto«.
vitqmiw^b;
RIBOFLPVIN
NIPCIW
RXORBIC
PCID
?,0
3
s
wwwwwww-^
UUTKITION DWISION, DEPT OF NfiTVONRL HEBLTH RND VWtLFnEC .V'itS
22
APPENDIX 2
EXHIBIT NO. 15
MlLl^
POR ONE DOLLPR , THE CONSUMER
GETS THESE PMOUNTS
OP ENERGY UNITS. (CPLORICS)
WHOLE . 5 0*/c> PRT
WHOLE . ^ S jo PRT l\
40
45
k\\^^\^
50
OF NUTRmON UNITS
(PROTEIN, MINERALS. VITPMINS)
^0 40 60 BO 1D0 120 lAO
SK.l»/\ MILK
WHOLE . 3-0%FnT
WHOLE. 3 5%FttT
^^^^^-
BRSEO ON SkClM MILK RT U^ fi QURRT.
WHOLE MILl<: RT 15 ^ fi QURt^T
NUTKITION DIVISION, DtPT OF NRTIONfiL HERLTH flNO WEUFRRt ,\l'b4Q.
ri LO -* O 30 '^ O M '-' O". — ' :
i2 CO'MOiXG'. MOO — 00^(
■S -v^ 'X) 00 cr. c~~ '^ Lc lo CO -^ ;
X ^ VsD 00 o o 00 c»: ^c <£> 00
P
<d
o
PQ
O
is
o
u
t-- LC o LO '- o :m — •* cr. a.
C^OlMOOCOOOOOoOOOCOin
•— ' M c^ r J CM ^j --I r-H .-- 1 rq CM
- 00 00 o-. in c^i -^ o M r^ t^ X
CO
X!
u
^
a>
^
Q
C/3
W
u
ii ii -^ -r O O :^i O C rj m a. '^D
.T re ^ M L': a-, t- cr. -^ lo — oo -r
■ — • — 00 CT~. 00 lt: LC -^ -^ -^ -^ CO r^
c c
0.22 t=!r:
z:^,
as
t^ c 00 1^ o lo Tf o Lo -"a* in
-t in CT- o — ' n cv) .-1 .-( :m ro
■s> ^- m '^ 'X) CD ^ '^o 'X3 '-0 '£
O
T m ^D c^ oc o~. o '^ c^i 00 Tt lo 'X
CO00rOCOCO0OM'-^'^-:f-*'*rJ-
0*, O'- O^- C'- O^ G^ G- G; Gj G"' G'* G"- G^.
[23]
APPENDIX 4
Short title.
"Milk."
Board
constituted.
Number of
members.
Remunera-
tion, etc.,
of members.
Appoint-
ment of
officers,
clerks, etc.
Expenses
of Board.
License
required.
Exception.
Jurisdiction
of Board.
CHAPTER 30
Original Milk Control Act — Assented to April 3rd, 1934.
and Amendments
(UP TO 1937)
(Note: Original Act in small letters; amendments in capital
letters.)
HIS MAJESTY, by and with the advice and consent of the
Legislative Assembly of the Province of Ontario, enacts as
follows:
1. This Act may be cited as The Milk Control Act, 1934.
la. IN THIS ACT, UNLESS THE CONTEXT OTHERWISE
REQUIRES, "MILK" SHALL INCLUDE WHOLE MILK AND
SUCH PRODUCTS OF MILK AS ARE SUPPLIED, PRO-
CESSED, DISTRIBUTED OR SOLD IN ANY FORM OTHER
THAN BUTTER AND CHEESE. (1935, Cap. 40, Sec. 2).
2. — (1) There shall be a board to be known as "The Milk
Control Board of Ontario," hereinafter called the "board" which
shall be a body corporate and have the powers and duties herein
specified and the administration of this Act and the regulations.
(2) The board shall consist of one or more members to be
appointed by the Lieutenant-Governor in Council to hold office
during pleasure and if more than one member is appointed,
the Lieutenant-Governor in Council shall designate which one
of them shall be the chairman of the board and any vacancies
in the said board shall be filled by the Lieutenant-Governor in
Council.
(3) The member or members of the board shall receive such
remuneration, allowances and expenses as may be determined
by the Lieutenant-Governor in Council.
(4) The board may, with the approval of the Lieutenant-
Governor in Council appoint and employ such officers, clerks
and employees as may be necessary, and the remuneration of
persons so appointed shall be determined by the Lieutenant-
Governor in Council.
(5) All salaries, remuneration and expenses of the board and
of its officers, clerks and servants shall be paid out of the Con-
solidated Revenue Fund upon the certificate of the Minister
of Agriculture or of an officer of his Department designated
by him for the purpose. (REPEALED, 1935, Cap. 40, Sec. 3.)
(5) ALL MONEYS REQUIRED FOR THE PURPOSE OF
THIS ACT SHALL BE PAID OUT OF ANY SUM APPRO-
PRIATED BY THE LEGISLATURE AND VOTED BY THE
ASSEMBLY FOR THAT PURPOSE. (1935, Cap. 40, Sec. 3).
2a.— (1) NO PERSON SHALL, DIRECTLY OR INDIRECTLY,
ENGAGE IN OR CARRY ON THE BUSINESS OF SUPPLY-
ING, DISTRIBUTING, TRANSPORTING, PROCESSING OR
SELLING MILK UNLESS SUCH PERSON IS THE HOLDER
OF A LICENSE ISSUED BY THE BOARD.
(2) THIS SECTION SHALL NOT APPLY TO THOSE PER-
SONS OR CLASSES OF PERSONS DESIGNATED BY THE
BOARD IN REGULATIONS PASSED UNDER THE AUTHOR-
ITY OF THIS ACT. (1935, Cap. 40, Sec. 4).
3. — (1) The board shall have jurisdiction and power upon its
own initiative, or upon complaint or request made to it in
writing, to inquire into any matter relating to the producing,
supplying, processing, handling, distributing or sale of milk
and, subject to the approval of the Lieutenant-Governor, to
make regulations with respect thereto or to any of the said
matters. (REPEALED, 1935, Cap. 40, Sec. 5.)
[24]
APPENDIX 4
25
Regulations.
Application
of
regulations.
Duty and
powers of
board.
Licenses
required.
(2) Without limiting or derogating from the generality of the
foregoing, the board, with the approval of the Lieutenant-
Governor in Council, may make regulations, —
(a) governing and supervising the producing, processing,
handling, storing, hauling, delivering, distributing, keep-
ing or offering for sale and the sale of milk, and all
persons engaged or employed therein, and the reports
and returns to be made by them to the board;
(b) requiring persons or classes of persons engaged or em-
ployed in the processing, handling, storing, hauling, de-
livering, distributing, keeping or offering for sale, or the
sale of milk to be licensed and to fix the term of such,
licenses and the fees to be paid therefor;
(c) governing disputes and the determination of disputes
arising between producers and distributors of milk, or
between any two or more classes or branches of persons
engaged in the milk industry as producers, processors,
handlers, haulers, distributors or vendors of milk, or as
being otherwise engaged in the said industry;
(d) governing agreements which may be entered into be-
tween producers of milk and other persons or classes of
persons engaged in the milk industry. (REPEALED, 1935,
Cap. 40, Sec. 5.)
(3) Any regulations made under the authority of this section
may be general in their application or may be limited to any
locality or localities, or to any persons or classes of persons, or
to any branch of the milk industry mentioned therein. (RE-
PEALED, 1935, Cap. 40, Sec. 5.)
3. IT SHALL BE THE DUTY OF THE BOARD AND IT
SHALL HAVE POWER,—
(a) UPON ITS OWN INITIATIVE OR UPON COMPLAINT
TO INQUIRE INTO ANY MATTER RELATING TO THE
PRODUCTION, TRANSPORTATION, PROCESSING,
DISTRIBUTION OR SALE OF MILK;
(b) TO ARBITRATE, ADJUST AND SETTLE DISPUTES
ARISING BETWEEN PRODUCERS. CONSUMERS, PRO-
CESSORS, DISTRIBUTORS AND TRANSPORTERS OF
MILK OR BETWEEN ANY TWO OR MORE CLASSES
OF SUCH PERSONS ENGAGED IN THE MILK
INDUSTRY;
(c) TO PROHIBIT IN THE PROVINCE ANY SALE OR
DELIVERY OF MILK OR OF CREAM OR OF MILK
AND CREAM ALONE OR IN COMBINATION WITH
ANY OTHER ARTICLE OF TRADE, AT A PRICE
LOWER THAN THE CURRENT PRICE OF MILK OR
CREAM OR OF A COMBINATION OF MILK OR CREAM
WITH ANY OTHER ARTICLE;
(d) TO PROHIBIT MILK DISTRIBUTORS COMPELLING
OR INDUCING PRODUCERS TO INVEST MONEY
EITHER DIRECTLY OR INDIRECTLY IN A DAIRY
PLANT OR OTHER EQUIPMENT IN ORDER THAT
SUCH PRODUCERS MAY OBTAIN OR RETAIN A
MARKET FOR THEIR MILK;
(e) TO PROHIBIT MILK DISTRIBUTORS FROM TERMI-
NATING THE PURCHASE OF MILK FROM A PRO-
DUCER WITHOUT JUST CAUSE (UNLESS FIFTEEN
DAYS' NOTICE IS GIVEN);
AND IN EACH CASE SHALL MAKE SUCH ORDER AS IT
DEEMS JUST, HAVING REGARD TO THE CIRCUMSTANCES.
(1935, Cap. 40, Sec. 5; italicized words deleted 1937, Cap. 42,
Sec. 2.)
4. No person who is required by the regulations to be licensed
under the authority of this Act shall engage or be employed in
any branch of the milk industry without such license. (RE-
PEALED, 1935, Cap. 40, Sec. 6.)
26
APPENDIX 4
When issue
of license
proliibited.
Power of
board to
refuse or
revoke
license.
Compliance
with the
Act.
Settlement
of disputes.
Appeal from
decision of
board.
Promulga-
tion of
regulations.
Rebates
prohibited.
4. NO LICENSE SHALL BE GRANTED TO A MILK DIS-
TRIBUTOR UNLESS THE BOARD IS SATISFIED THAT THE
APPLICANT IS QUALIFIED BY EXPERIENCE, FINANCIAL
RESPONSIBILITY AND EQUIPMENT TO PROPERLY CON-
DUCT THE PROPOSED BUSINESS, AND THAT THE ISSU-
ANCE OF THE LICENSE IS IN THE PUBLIC INTEREST
(1935, Cap. 40, Sec. 6.)
4a. SUBJECT TO THE PROVISIONS OF SECTION 4 OF
THIS ACT THE BOARD MAY REFUSE TO GRANT OR
RENEW A LICENSE OR MAY SUSPEND OR REVOKE A
LICENSE ALREADY GRANTED, AFTER DUE NOTICE AND
OPPORTUNITY OF HEARING TO THE APPLICANT OR
LICENSEE, WHEN THE BOARD IS SATISFIED OF THE
EXISTENCE OF ANY ONE OR MORE OF THE FOLLOWING
CONDITIONS:
(a) FAILURE TO OBSERVE, PERFORM AND CARRY OUT
THE PROVISIONS OF THE MILK CONTROL ACT,
1934, OR OF THE MILK AND CREAM ACT, THE DAIRY
PRODUCTS ACT, THE PUBLIC HEALTH ACT OR ANY
OTHER ACT OF THE LEGISLATURE OF ONTARIO,
OR OF THE DOMINION OF CANADA, OR AMEND-
MENTS THEREOF, OR OF ANY REGULATIONS MADE
UNDER ANY SUCH ACT WHICH IN ANY WAY PER-
TAINS TO AND GOVERNS OR REGULATES THE
SUPPLY OF MILK FOR HUMAN CONSUMPTION;
(b) FAILURE TO PROVIDE FOR AND CONTINUE IN
EFFECT PROOF OF FINANCIAL RESPONSIBILITY AS
REQUIRED BY THIS ACT OR THE REGULATIONS;
(c) FAILURE TO OBSERVE, PERFORM AND CARRY OUT
ANY REGULATION OR ORDER OF THE BOARD
MADE UNDER THIS ACT. (1935, Cap. 40, Sec. 7; under-
lined words added 1937, Cap. 42, Sec. 3.)
5. No person shall engage or be employed in any branch of
the milk industry except as provided by and in accordance
with this Act and the regulations.
6. No action may be brought respecting or for the determina-
tion of any dispute which by the ACT OR regulations is required
to be determined by arbitration, and any such dispute shall be
determined as provided for in the regulations. (Amended 1937,
Cap. 42, Sec. 4.)
6a. AN APPEAL SHALL LIE, BY WAY OF ORIGINATING
NOTICE, FROM ANY ORDER OR DECISION OF THE BOARD
UNDER SECTION 4 OR 4a OF THIS ACT TO A JUDGE OF
THE SUPREME COURT WHO MAY RECEIVE SUCH EVI-
DENCE, GIVE SUCH DIRECTIONS FOR THE CONDUCT OF
THE PROCEEDINGS, AND MAKE SUCH ORDER OR DE-
CISION THEREON AS HE MAY DEEM JUST, AND HIS
DECISION SHALL BE FINAL AND SHALL NOT BE SUBJECT
TO APPEAL. (1935, Cap. 40, Sec. 7.)
7. Every regulation made under this Act shall be published by
the board in two successive issues of the Ontario Gazette and
when so published shall while it remains in force, have the like
effect as if enacted in this Act, and all courts shall take judicial
notice thereof.
7a NOTWITHSTANDING ANYTHING IN THE COMPANIES
ACT OR IN ANY LETTERS PATENT OF INCORPORATION
OR SUPPLEMENTARY LETTERS PATENT OR IN ANY
OTHER GENERAL OR SPECIAL ACT CONTAINED, NO
PERSON, FIRM OR CORPORATION SHALL GIVE OR DIS-
TRIBUTE ANY FUND, REFUND, REBATE, INTEREST OR
DIVIDEND TO ANY PUCHASER OF MILK THEREFROM,
EITHER DIRECTLY OR INDIRECTLY IN RESPECT OF SUCH
APPENDIX 4
27
Powers of
board as to
inquiry and
I'eport.
Board may
approve
agreements.
Representa-
tive of
(-•onsumers.
Effect of
approval.
Rstabli.«h-
nn-nt of
fund and
cliarges.
Regulations.
PURCHASES OF MILK, EXCEPT SUCH INTEREST OR
DIVIDEND AS MAY BE EARNED ON CAPITAL INVESTED
BY SUCH PURCHASER IN SUCH FIRM OR CORPORATION.
(1935, Cap 40, Sec. 7.)
8. The board, or any person authorized by the board to make
inquiry or report, may when it appears expedient, —
(a) enter upon and inspect any land, place, building, works
or other property;
(b) require the attendance of all such persons as it or he
thinks fit to summon and examine and take the testimony
of such persons;
(c) require the production of all books, records, plans, speci-
fications, drawings, writings and documents;
(d) administer oaths, affirmations or declarations and shall
have the like powers to summon witnesses, enforce their
attendance and compel them to give evidence and produce
books, records, plans, specifications, drawings, writings
and documents which it or he may require them to
produce as is vested in the Supreme Court.
8a.— (]) WITHOUT DEROGATING FROM THE GENERALITY
OF THE PROVISIONS OF SECTION 3 THE BOARD" MAyTTF
IT DEEMS IT IN THE PUBLIC INTEREST, (AFTER CONSULT-
ING ANY LOCAL MUNICIPAL OFFICER OR OFFICERS AP-
POINTED TO REPRESENT THE CONSUMERS' INTERESTS
SUBJECT TO^THE PROVISIONS OF^SUBSECTION la. AP-
PROVE ANY AGREEMENT RESPECTING THE PRICE OF
MILK AND FAIR BUSINESS PRACTICES ENTERED INTO
BETWEEN PRODUCERS. PROCESSERS. MILK DEALERS
TRANSPORTERS OF MILK AND DISTRIBUTORS OR ANY OF
THEM, AND WHEN SO APPROVED, SUCH AGREEMENT
SHALL BE BINDING UPON EVERY PERSON PARTNER-
SHIP, ASSOCIATION OR CORPORATION. SELLING DE-
LIVERING OR BUYING MILK WITHIN THE LIMITS OF THE
AREA AFFECTED BY THE AGREEMENT. (1935, Cap. 40,
Sec. 7; italicized words deleted and underlined words added
1937, Cap. 42, Sec. 5(1).)
(la) THE COUNCIL OF ANY MUNICIPALITY MAY
APPOINT A REPRESENTATIVE OF THE MILK CONSUMERS
WITHIN SUCH MUNICIPALITY WHO, UPON NOTICE TO
THE BOARD OF SUCH APPOINTMENT SHALL BE EN-
TITLED TO APPEAR BEFORE THE BOARD OR ANY PERSON
AUTHORIZED BY THE BOARD TO MAKE INQUIRY,
BEFORE ANY AGREEMENT AFFECTING MILK PRICES TO
THE CONSUMERS WITHIN SUCH MUNICIPALITY IS
APPROVED. (1937, Cap. 42, Sec. 5(2).)
(2) WHERE THE BOARD HAS APPROVED AN AGREE-
MENT RESPECTING THE PRICE OF MILK AND FAIR BUSI-
NESS PRACTICES AS PROVIDED IN THIS SECTION.
NON-COMPLIANCE WITH ANY OF THE PROVISIONS OF
SUCH AGREEMENT SHALL BE A VIOLATION OF THIS
ACT. (1935, Cap. 40, Sec. 7.)
8b. FOR THE PURPOSE OF CARRYING OUT ANY SCHEME
OR PLAN FOR THE MARKETING OR REGULATING OF
ANY MILK. THE BOARD MAY ESTABLISH A SEPARATE
FUND AND MAY IMPOSE DIRECT CHARGES OR TOLLS IN
RESPECT OF THE MARKETING OF THE WHOLE OR ANY
PART OF SUCH MILK. WHICH CHARGES AND TOLLS
SHALL BE PAYABLE BY SUCH PERSONS ENGAGED IN
THE PRODUCTION OR MARKETING OF SUCH MILK AS
THE BOARD MAY DETERMINE. (1937, Cap. 42, Sec. 7.)
9. The board, with the approval of the Lieutenant-Governor
in Council, may from time to time make regulations respecting, —
28
APPENDIX 4
(a) the meetings and proceedings of the board;
(b) the respective duties of the staff and of other persons
employed by the board;
(c) the records, books and accounts to be kept by the board;
(d) the practice and procedure in all matters before the
board and the conduct of all persons appearing before
the board. (REPEALED, 1935, Cap. 40, Sec. 8.)
Regulations. ^._(i) THE BOARD MAY MAKE SUCH REGULATIONS,
WITH THE APPROVAL OF THE LIEUTENANT-GOVERNOR
IN COUNCIL, AS IT DEEMS NECESSARY IN THE PUBLIC
INTEREST, AND WITHOUT DEROGATING FROM THE GEN-
ERALITY OF THE FOREGOING MAY BY SUCH REGULA-
TIONS,—
(a) SPECIFY THE TERMS AND CONDITIONS UPON
WHICH A LICENSE MAY BE OBTAINED AND THE
FEES PAYABLE THEREFOR AND THE PERSONS OR
CLASSES OF PERSONS NOT REQUIRED TO BE LI-
CENSED AS PROVIDED BY SECTION 2a OF THIS ACT;
(b) PRESCRIBE THE TERMS AND CONDITIONS UPON
WHICH MILK MAY BE RECEIVED, HANDLED,
TRANSPORTED, STORED, DELIVERED, SUPPLIED,
PROCESSED, KEPT FOR SALE OR SOLD;
(c) CLASSIFY MILK PRODUCERS AND DISTRIBUTORS
OR ANY OTHER PERSONS ENGAGED IN THE MILK
INDUSTRY;
(d) REQUIRE PERSONS WHO SUPPLY, DISTRIBUTE,
TRANSPORT, PROCESS, KEEP FOR SALE OR SELL
MILK TO FURNISH TO THE BOARD SUCH INFORMA-
TION AS THE BOARD MAY FROM TIME TO TIME
REQUIRE;
(e) REQUIRE ANY APPLICANT FOR A LICENSE UNDER
THIS ACT TO FURNISH PROOF OF FINANCIAL
RESPONSIBILITY AND TO REQUIRE A BOND FROM
SUCH APPLICANT IN SUCH AMOUNT AS THE
BOARD MAY DEEM NECESSARY;
(f) PROVIDE FOR THE FORM OF ORDERS AND OTHER
FORMS TO BE USED FOR THE PURPOSE OF THIS
ACT;
(g) PRESCRIBE THE MEETINGS AND PROCEEDINGS OF
THE BOARD;
(h) PRESCRIBE THE RESPECTIVE DUTIES OF THE
STAFF AND OF OTHER PERSONS EMPLOYED BY
THE BOARD;
(i) PRESCRIBE THE RECORDS, BOOKS AND ACCOUNTS
TO BE KEPT BY THE BOARD;
(j) PRESCRIBE THE PRACTICE AND PROCEDURE IN
ALL MATTERS BEFORE THE BOARD AND THE
CONDUCT OF ALL PERSONS APPEARING BEFORE
THE BOARD; (1935, Cap. 40, Sec. 8)
(k) PRESCRIBE MILK PURCHASE PLANS AND THE
DATES OF PAYMENT FOR MILK PURCHASED FROM
PRODUCERS;
(1) PRESCRIBE THE RECORDS TO BE KEPT BY DIS-
TRIBUTORS, PROCESSORS AND TRANSPORTERS.
(1937, Cap. 42, Sec. 6.)
(2) ANY REGULATIONS MADE UNDER THE AUTHORITY
OF THIS SECTION MAY BE GENERAL IN THEIR APPLICA-
TION OR MAY BE LIMITED TO ANY LOCALITY OR LO-
CALITIES, OR TO ANY PERSON OR CLASSES OF PERSONS,
OR TO ANY BRANCH OF THE MILK INDUSTRY MEN-
TIONED THEREIN. (1935. Cap. 40, Sec. 8.)
Regulations
may be
general or
limited.
APPENDIX 4
29
Prohibition
against
using millc
containers.
Annual
Report.
To be laid
before
Assembly.
Injunction
proceedings.
Application
may be
ex parte
or by
originating
notice.
Penalties.
Commence-
ment of Act.
9a. NO PERSON, OTHER THAN THE OWNER THEREOF,
SHALL USE IN THE ORDINARY COURSE OF HIS BUSINESS
ANY MILK BOTTLE, MILK CAN, MILK CASE OR ANY
OTHER EQUIPMENT MARKED WITH THE NAME OF A
MILK DISTRIBUTOR OR DAIRY. (1937, Cap. 42, Sec. 7.)
10. — (1) The Board shall make an annual report in writing
to the Minister of Agriculture not later than the 31st day of
January in every year showing a record of the meetings and
an abstract of its proceedings during the preceding calendar
year and containing such other matters as appear to the board
to be of public interest in connection with matters within
its jurisdiction or which the Lieutenant-Governor in Council
may direct.
(2) Every such report shall be laid before the Assembly
forthwith if then in session, or if not then in session, within
fifteen days after the commencement of the next session.
10a.— (1) WHERE IT IS MADE TO APPEAR FROM THE
MATERIAL FILED OR EVIDENCE ADDUCED THAT ANY
OFFENCE AGAINST THIS ACT OR THE REGULATIONS
HAS BEEN OR IS BEING COMMITTED, THE SUPREME
COURT OR ANY JUDGE THEREOF MAY, UPON THE
APPLICATION OF THE BOARD, ENJOIN—
(a) ANY PURCHASER. PROCESSOR, TRANSPORTER. DIS-
TRIBUTOR OR DEALER IN MILK FROM CARRYING
ON BUSINESS AS SUCH PURCHASER, PROCESSOR,
TRANSPORTER, DISTRIBUTOR OR DEALER, ABSO-
LUTELY, OR FOR SUCH PERIOD AS SHALL SEEM
JUST, AND ANY INJUNCTION SHALL IPSO FACTO
CANCEL THE LICENSE OF ANY SUCH PURCHASER.
PROCESSOR, TRANSPORTER, DISTRIBUTOR OR
DEALER NAMED IN THE ORDER DURING THE SAME
PERIOD.
(2) THE APPLICATION OF THE BOARD UNDER SUB-
SECTION 1 MAY BE MADE WITHOUT ANY ACTION BEING
INSTITUTED EITHER,—
(a) BY AN EX PARTE MOTION FOR AN INTERIM IN-
JUNCTION WHICH SHALL, IF GRANTED, REMAIN IN
FULL FORCE FOR TEN DAYS FROM THE DATE
THEREOF UNLESS THE TIME IS EXTENDED OR THE
ORIGINATING MOTION MENTIONED IN CLAUSE (b)
HEREOF IS SOONER HEARD AND DETERMINED; OR
(b) BY AN ORIGINATING NOTICE OF MOTION WHICH,
IF AN INTERIM INJUNCTION HAS BEEN GRANTED,
SHALL BE SERVED WITHIN FIVE DAYS AND RE-
TURNABLE WITHIN TEN DAYS FROM THE DATE
OF SUCH INTERIM INJUNCTION. (1935, Cap. 40, Sec. 9.)
11. EVERY PERSON WHO VIOLATES ANY OF THE PRO-
or of any regulation, rule or order made under this Act or
of the board shall incur a penalty of not less than $5 for each
offence, recoverable under The Summary Convictions Act.
(REPEALED, 1935, Cap. 40, Sec. 10.)
11. EVERY PERSON WHO VIOLATES ANY OF THE PRO-
VISIONS OF THIS ACT OR THE REGULATIONS, OR ANY
ORDER MADE UNDER THIS ACT SHALL BE LIABLE, FOR
A FIRST OFFENCE, TO A PENALTY OF $50; AND FOR A
SECOND OR SUBSEQUENT OFFENCE TO A PENALTY OF
NOT LESS THAN $100, NOR MORE THAN $500, RECOVER-
ABLE UNDER THE SUMMARY CONVICTIONS ACT. (1935,
Cap. 40, Sec. 10.)
12. This Act shall come into force on a day to be named by
the Lieutenant-Governor by his Proclamation.
APPENDIX 5
••Milk.
Board
constituted.
Xumber of
members.
Quorum.
Remunera-
tion, etc., of
members.
Appoint-
ment of
otticers,
clerks, etc.
Expenses
of Board.
License
required.
Exception.
Duty and
powers of
board.
CONSOLIDATED MILK CONTROL ACT
R.S.O. 1937, Cap. 76
AND AMENDMENTS
(Note: Consolidate Act in small letters; amendments
in capital letters.)
1. In this Act, unless the context otherwise requires, "milk"
shall include whole milk and such products of milk as are
supplied, processed, distributed or sold in any form other than
butter and cheese.
2. — (1) There shall be a board to be known as "The Milk Control
Board of Ontario," hereinafter called the "board" which shall be
a body corporate and have the powers and duties herein specified
and the administration of this Act and the regulations.
(2) The Board shall consist of one or more members to be
appointed by the Lieutenant-Governor in Council to hold office
during pleasure and if more than one member is appointed,
the Lieutenant-Governor in Council shall designate which one
of them shall be the chairman of the board and any vacancies
in the said board shall be filled by the Lieutenant-Governor
in Council.
(2a) WHERE THE BOARD CONSISTS OF FOUR OR MORE
PERSONS THREE MEMBERS SHALL CONSTITUTE A
QUORUM. (1944, Cap. 36, Sec. 1.)
(3) The member or members of the board shall receive such
remuneration, allowances and expenses as may be determined
by the Lieutenant-Governor in Council.
(4) The board may, with the approval of the Lieutenant-
Governor in Council appoint and employ such officers, clerks
and employees as may be necessary, and the remuneration of
persons so appointed shall be determined by the Lieutenant-
Governor in Council.
(5) All moneys required for the purpose of this Act shall be
paid out of any sum appropriated by the Legislature and voted
by the Assembly for that purpose.
3. — (1) No person shall, directly or indirectly, engage in or
carry on the business of supplying, distributing, transporting,
processing or selling milk unless such person is the holder of a
license issued by the board.
(2) This section shall not apply to those persons or classes
of persons designated by the board in regulations passed under
the authority of this Act.
4._(1) It shall be the duty of the board and it shall have
power, —
(a) upon its own initiative or upon complaint to inquire into
any matter relating to the production, transportation,
processing, distribution or sale of milk;
(b) to arbitrate, adjust and settle disputes arising between
producers, consumers, processors, distributors and trans-
porters of milk or between any two or more classes of
such persons engaged in the milk industry;
(c) to prohibit in the Province any sale or delivery of milk
or of cream or of milk and cream alone or in combination
with any other article of trade, at a price lower than the
current price of milk or cream or of a combination of
milk or cream with any other article;
[30]
APPENDIX 5
31
Adminif;-
trative
Duties.
Wlien issii.
of license
prohibited.
Power of
board to
iefu.se or
revoke
license.
Rev. Stat.,
cc. 7(>. 302.
304, 290.
(d) to prohibit milk distributors compelling or inducing pro-
ducers to invest money either directly or indirectly in a
dairy plant or other equipment in order that such pro-
ducers may obtain or retain a market for their milk;
(e) To prohibit milk distributors from terminating the pur-
chase of milk from a producer without just cause;
and in each case shall make such order as it deems just, having
regard to the circumstances.
(2) NOTWITHSTANDING ANY OTHER PROVISION OF
THIS ACT THE CHAIRMAN OF THE BOARD MAY PERFORM
SUCH OF THE DUTIES OF THE BOARD AS THE LIEUTEN-
ANT-GOVERNOR IN COUNCIL MAY PRESCRIBE. (1944,
Cap. 36, Sec. 2.)
5. No license shall be granted to a milk distributor unless the
board is satisfied that the applicant is qualified by experience,
financial responsibility and equipment to properly conduct the
proposed business, and that the issuance of the license is in the
public interest.
6. Subject to the provisions of section 5 the board may refuse
to grant or renew a license or may suspend or revoke a license
already granted, after due notice and opportunity of hearing to
the applicant or licensee, when the board is satisfied of the
existence of any one or more of the following conditions, —
(a) failure to observe, perform and carry out the provisions
of this Act or of The Milk and Cream Act. The
Dairy Products Act, The Public Health Act or
any other Act of this Legislature, or of the Parliament
of Canada, or amendments thereof, or of any regulations
made under any such Act which in any way pertains
to and governs or regulates the supply of milk for
human consumption;
(b) failure to provide for and continue in effect proof of
financial responsibility as required by this Act or the
regulations;
(c) failure to observe, perform and carry out any regulation
or order of the board made under this Act.
Compliance 7. No person shall engage or be employed in any branch of
AcV^ *^*^ the milk industry except as provided by and in accordance
with this Act and the regulations.
8. No action may be brought respecting or for the determina-
tion of any dispute which by the Act or regulations is required
to be determined by arbitration, and any such dispute shall be
determined as provided for in the regulations.
9. An appeal shall lie, by way of originating notice, from any
order or decision of the board under section 5 or 6 to a judge
of the Supreme Court who may receive such evidence, give
such directions for the conduct of the proceedings, and make
such order or decision thereon as he may deem just, and his
decision shall be final and shall not be subject to appeal.
10. Every regulation made under this Act shall be published
by the board in two successive issues of the Ontario Gazette
and when so published shall, while it remains in force, have
the like effect as if enacted in this Act. and all courts shall take
judicial notice thereof.
11. Notwithstanding anything in The Companies Act or in any
letters patent of incorporation or supplementary letters patent
or in any other general or special Act contained, no person, firm
or corporation shall give or distribute any fund, refund, rebate,
interest or dividend to any purchaser of milk therefrom, either
directly or indirectly in respect of such purchases of milk
Settlement
of disputes.
Appeal from
decision
of board.
Promulga-
tion of
regulations.
Rebates
prohibited.
32
APPENDIX 5
Powers of
Board as to
inquiry and
report.
Board may
approve
agreements.
Representa-
tive of
consumers.
Information
to be fur-
nished to
representa-
tive.
Effect of
approval.
Establish-
ment of
fund and
charges.
except such interest or dividend as may be earned on capital
invested by such purchaser in such firm or corporation.
12. The board, or any person authorized by the board to make
inquiry or report, may, when it appears expedient, —
(a) enter upon and inspect any land, place, building, works
or other property;
(b) require the attendance of all such persons as it or he
thinks fit to summon and examine and take the testimony
of such persons;
(c) require the production of all books, records, plans, speci-
fications, drawings, writings and documents;
(d) administer oaths, affirmations or declarations and shall
have the like powers to summon witnesses, enforce their
attendance and compel them to give evidence and produce
books, records, plans, specifications, drawings, writings
and documents which it or he may require them to
produce as is vested in the Supreme Court.
13. — (1) Without derogating from the generality of the pro-
visions of section 4, the board may, if it deems it in the public
interest, subject to the provisions of subsection 2 approve any
agreement respecting the price of milk and fair business prac-
tices entered into between producers, processors, milk dealers,
transporters of milk and distributors or any of them, and when
so approved, such agreement shall be binding upon every person,
partnership, association or corporation, selling, delivering or
buying milk within the limits of the area affected by the agree-
ment.
(2) The council of any municipality may appoint a repre-
sentative of the milk consumers within such municipality who,
upon notice to the board of such appointment, shall be entitled
to appear before the board or any person authorized by the
board to make inquiry, before any agreement affecting milk
prices to the consumers within such municipality is approved.
(REPEALED, 1941, Cap. 31, Sec. 1.)
(2) THE COUNCIL OF ANY LOCAL MUNICIPALITY MAY
BY BY-LAW APPOINT A REPRESENTATIVE OF THE MILK
CONSUMERS WITHIN SUCH MUNICIPALITY AND UPON
THE FILING OF A CERTIFIED COPY OF SUCH BY-LAW
WITH THE BOARD, THE REPRESENTATIVE SHALL,
BEFORE ANY AGREEMENT AFFECTING MILK PRICES
PAYABLE BY THE CONSUMERS WITHIN SUCH MUNICI-
PALITY IS APPROVED, BE ENTITLED TO APPEAR BEFORE
THE BOARD OR ANY PERSON AUTHORIZED BY THE
BOARD TO MAKE INQUIRY.
(2a) THE BOARD SHALL FURNISH TO ANY REPRESEN-
TATIVE APPOINTED UNDER SUBSECTION 2, INFORMA-
TION IN THE POSSESSION OF THE BOARD RESPECTING
THE PRODUCTION, TRANSPORTATION, PROCESSING AND
DISTRIBUTION OF MILK SOLD WITHIN THE MUNICIPAL-
ITY WHEN SO REQUESTED BY THE REPRESENTATIVE.
(1941, Cap. 31, Sec. 1.)
(3) Where the board has approved an agreement respecting
the price of milk and fair business practices as provided in this
section, non-compliance with any of the provisions of such
agreement shall be a violation of this Act.
14. For the purpose of carrying out any scheme or plan for
the marketing or regulating of any milk, the board may estab-
lish a separate fund and may impose direct charges or tolls in
respect of the marketing of the whole or any part of such milk,
which charges and tolls shall be payable by such persons
engaged in the production or marketing of such milk as the
board may determine. (REPEALED, 1944, Cap. 36, Sec. 3.)
APPENDIX 5
33
Establish- 14. WHEN THE MINISTER OF AGRICULTURE RECEIVES
ffis ''for FROM AN ASSOCIATION OF MILK PRODUCERS WHO ARE
producers' ENGAGED IN SUPPLYING MILK TO DISTRIBUTORS OR
associations. PROCESSORS IN ANY AREA A PETITION ASKING THAT
FOR THE PURPOSE OF DEFRAYING THE EXPENSES OF
SUCH ASSOCIATION EVERY PRODUCER ENGAGED IN
SUPPLYING MILK TO DISTRIBUTORS OR PROCESSORS
IN SUCH AREA BE REQUIRED TO PAY LICENSE FEES, THE
MINISTER SUBJECT TO THE APPROVAL OF THE LIEU-
TENANT-GOVERNOR IN COUNCIL MAY, IF HE IS OF THE
OPINION THAT SUCH ASSOCIATION IS FAIRLY REPRE-
SENTATIVE OF THE PRODUCERS SO ENGAGED, MAKE
AN ORDER
(a) REQUIRING EVERY PRODUCER SO ENGAGED TO
PAY TO THE ASSOCIATION LICENSE FEES IN DIF-
FERENT AMOUNTS AND FIXING THE AMOUNTS OF
SUCH FEES PAYABLE IN INSTALMENTS;
(b) REQUIRING EVERY PRODUCER AND DISTRIBUTOR
WHO RECEIVES MILK FROM ANY SUCH PRODUCER
TO DEDUCT THE AMOUNT OF THE LICENSE FEES
OF SUCH PRODUCER FROM MONEYS PAYABLE TO
THE PRODUCER AND TO PAY SUCH AMOUNT TO
THE ASSOCIATION;
(c) PREVENTING THE ASSOCIATION FROM USING ANY
SUCH AMOUNT FOR THE RETAIL OR WHOLESALE
DISTRIBUTION OR PROCESSING OF MILK; AND
(d) REQUIRING THE ASSOCIATION TO FURNISH TO
THE BOARD SUCH INFORMATION AND FINANCIAL
STATEMENTS AS THE BOARD MAY DETERMINE.
(1944, Cap. 36, Sec. 3.)
Regulations 15 — (i) The board may make such regulations, with the
approval of the Lieutenant-Governor in Council, as it deems
necessary in the public interest, and without derogating from
the generality of the foregoing may by such regulations, —
(a) specify the terms and conditions upon which a license
may be obtained and the fees payable therefor and the
persons or classes of persons not required to be licensed
as provided by section 3;
(b) prescribe the terms and conditions upon which milk may
be PURCHASED, received, handled, transported, stored,
delivered, supplied, processed, kept for sale or sold;
(Amended 1940, Cap. 28, Sec. 20.)
(c) classify milk producers and distributors or any other
persons engaged in the milk industry;
(d) require persons who supply, distribute, transport, pro-
cess, keep for sale or sell milk to furnish to the board
such information as the board may from time to time
require;
(e) require any applicant for a license under this Act to
furnish proof of financial responsibility and to require a
bond from such applicant in such amount as the board
may deem necessary;
(f) provide for the form of orders and other forms to be
used for the purpose of this Act;
(g) prescribe the meetings and proceedings of the board;
(h) prescribe the respective duties of the staff and of other
persons employed by the board;
(i) prescribe the records, books and accounts to be kept by
the board;
(j) prescribe the practice and procedure in all matters before
the board and the conduct of all pei'sons appearing before
the board;
(k) prescribe milk purchase plans and the dates of pay-
ment for milk purchased from producers;
(1) prescribe the records to be kept by distributors, pro-
cessors and transporters.
34
APPENDIX 5
Regulations
may be
greneral or
limited.
Prohibition
against
using milk
containers.
Annual
Report.
To be laid
before
Assembly.
Injunction
proceedings.
Application
may be
ex pai'te.
or by origin-
ating notice.
Penalties.
(2) Any regulations made under the authority of this section
may be general in their application or may be limited to any
locality or localities, or to any person or classes of persons, or to
any branch of the milk industry mentioned therein.
16. No person, other than the owner thereof, shall use in the
ordinary course of his business any milk bottle, milk can, milk
case or any other equipment marked with the name of a milk
distributor or dairy. (REPEALED, 1946, Cap. 89, Sec. 29.)
17. — (1) The board shall make an annual report in writing to
the Minister of Agriculture not later than the 31st day of
January in every year showing a record of the meetings and
an abstract of its proceedings during the preceding calendar
year and containing such other matters as appear to the board
to be of public interest in connection with matters within its
jurisdiction or which the Lieutenant-Governor in Council may
direct.
(2) Every such report shall be laid before the Assembly
forthwith if then in session, or if not then in session, within
fifteen days after the commencement of the next session.
18. — (1) Where it is made to appear from the material filed
or evidence adduced that any offence against this Act or the
regulations has been or is being committed, the Supreme Court
or any judge thereof may, upon the application of the board,
enjoin any purchaser, processor, transporter, distributor or
dealer in milk from carrying on business as such purchaser,
processor, transporter, distributor or dealer, absolutely, or for
such period as shall seem just, and any injunction shall ipso
facto cancel the license of any such purchaser, processor, trans-
porter, distributor or dealer named in the order during the
same period.
(2) The application of the board under subsection 1 may be
made without any action being instituted either, —
(a) by an ex parte motion for an interim injunction which
shall, if granted, remain in full force for ten days from
the date thereof unless the time is extended or the
originating motion mentioned in clause (b) hereof is
sooner heard and determined; or
(b) by an originating notice of motion which, if an interim
injunction has been granted, shall be served within five
days and returnable within ten days from the date of
such interim injunction.
19. Every person who violates any of the provisions of this
Act or the regulations, or any order made under this Act shall
be liable, for a first offence, to a penalty of $50; and for a
second or subsequent offence, to a penalty of not less than $100,
nor more than $500, recoverable under The Summary Convic-
tions Act.
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[35]
36
APPENDIX 6
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rvj c-i i^i ^j ^i w' ^^ im' c-i ^) w ^i n' m n m' r-i r' rJ ^i
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^i m' cvi M cm'
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APPENDIX 7
PRODUCER FUNDS RECOVERED BY MILK CONTROL BOARD
Year
1939
1940
1941
1942
1943
1944
1945
1946
Totals .
Calling
Bonds
$12,177.57
1.500.00
3,409.44
1,048.13
15,017.47
1.500.00
4,463.29
669.84
Adjustments
Ordered
S 2,200.00
12.088.03
6,834 69
2,245.91
5.301.25
13.131.28
11.789.94
8,472.75
Total
$14,377.57
13.588.03
10,244.13
3,294.04
20,318.72
14.631.28
16.253.23
9,142.59
$39,785.74 $62,063.85 $101,849.59
The above record does not include the early years of control. There were
some bonds called but the record was not kept separately.
The recovery over the years has amounted to quite an impressive sum of
money. However, the protection to the producer should not be measured
by the actual recovery of producer funds. The real value in the bond
requirements to a license lies in the salutary effect it has. There are
numerous cases where dairies, rather than have their bond called, have
raised money from other sources to meet producer accounts.
39]
APPENDIX 8
STATISTICAL MATERIAL CHICAGO MARKETING AREA
The index only of this summary has been included to demonstrate the
type of statistical material considered essential by the United States
Department of Agriculture when fixing prices. The actual tables which
relate to the Chicago area are not of general value to Ontario readers and
because they are voluminous have not been reproduced. Any persons
interested in the tables themselves may secure a full copy by writing to
the United States Department of Agriculture, Washington, D. C.
COMPILATION OF STATISTICAL MATERIAL
PERTAINING TO THE
PROPOSED AMENDMENTS TO
FEDERAL ORDER 41, ORIGINAL AND AS AMENDED,
FOR THE CHICAGO, ILLINOIS, MARKETING AREA
AND
FEDERAL ORDER 69, ORIGINAL AND AS AMENDED,
FOR THE SUBURBAN CHICAGO, ILLINOIS, MARKETING AREA
March 1947
Prepared by the Dairy Branch Production and Marketing Administration,
United States Department of Agriculture
TABLE OF CONTENTS
SECTION ONE:
Statistics Pertaining to Federal Order 69, as Amended
Table Page
No. No.
Map of Suburban Chicago Milk Marketing Area 1
1 Class Prices per Hundredweight of Milk for Handlers under
Federal Order 69, as Amended, September, 1944 through December,
1946 2
2 Average Uniform Producer Prices for 3.5% Milk — 70-mile Zone,
Federal Order 69 (Original and as Amended), September, 1944
through December, 1946 3
3 Grade "A" Receipts and Classification Showing Percentage of Total
Milk in Each Class, Federal Order 69 — September, 1944 through
December, 1946 4
4 Grade "B" Receipts and Classification Showing Percentage of Total
Milk in Each Class, Federal Order 69 — September, 1944 through
December, 1946 5
5 Grade "A" and "B" Receipts and Classification Showing Percentage
of Total Milk in Each Class, Federal Order 69— September, 1944
through December, 1946 6
6 Receipts of Milk and Cream from All Sources by Handlers under
Federal Order 69, Original and as Amended, September, 1944
through December, 1946 7
[40]
TABLE OF CONTENTS 41
SECTION ONE:
Statistics Pertaining to Federal Order 69, as Amended (Continued)
Table Page
No. No.
7 Average Daily Milk Delivery per Producer, with Monthly Varia-
tions Shown from Low Month of Each Year, and Indexes of Pro-
duction for Grade "A" and "B" Milk, under Federal Order 69
(Original and as Amended) September, 1944 through December,
1946 8
8 Number of Producers by Months, under Federal Order 69 (Original
and as Amended) 9
9 Number of Producers by States, and Receipts of Milk and of
Butterfat in Cream by States for November, 1946 under Order 69,
as Amended 9
10 Butterfat Tests of Milk Delivered by Producers to Handlers and of
Class I Milk under Federal Order 69, Original and as Amended,
September, 1944 - December, 1946 10
11 The Amount of Buttermilk and Chocolate Drink and the Butterfat
in these Products Disposed of by Handlers under Federal Order 69
(Original and as Amended) September, 1944 through December,
1946 11
12 Shrinkage and Overrun Compared with Receipts for Handlers
under Order 69, 12 Months— July, 1945 through June, 1946 12
SECTION TWO:
Statistics Pertaining to Federal Order 41, as Amended
Map of Counties Proposed to be Added to Surplus Milk Manu-
facturing Area under Order 41, as Amended 13
13 Producer Milk Receipts and Classification and Percentage of Total
in Each Class and Used in Computation of the Blended Prices,
January, 1940 through December, 1946, Chicago, Illinois Marketing
Area under Order 41, Original and as Amended 14
Table 13, continued 15
14 Chicago Milk Prices, under Federal Order 41, Original and as
Amended, January, 1940 through December, 1946 16
Table 14, continued 17
15 Total Deliveries of Milk from Producers to Handlers, by Zones and
Zone Groups, by Months, 1940-1946 under Order 41, Original and
as Amended 18
Table 15, continued 19
16 Amounts of Money Allowed Handlers for Location Adjustments by
Zone Groupings under Order 41, as Amended, January, 1944
through December, 1946 20
17 Location Adjustments to Producers in Total Dollars, by Zones and
Zone Groups, by Months, 1944-1946 under Order 41, as Amended 21
18 The Amount of Fluid Milk Shipped to the 70-mile Zone by
Handlers from Plants Located in Zones 2 to 21, inclusive, under
Order 41, as Amended, January, 1944-December, 1944 and January,
1946-August, 1946 22
19 The Amount of Milk on Which Class I Location Adjustment was
Allowed Handlers under Order 41, as Amended, January, 1944-
December, 1944 and January, 1946-August, 1946 23
20 The Amount of Butterfat in Cream Shipped to the 70-mile Zone by
Handlers from Plants Located in Zones 2 to 21, inclusive, under
Order 41, as Amended, January, 1944-December, 1944 and January,
1946-August, 1946 24
21 The Amount of 3.5% Milk Equivalent of Butterfat on Which Class
II Location Adjustment was Allowed under Order 41, as Amended,
January, 1944-December, 1944 and January, 1946-August, 1946 25
41a TABLE OF CONTENTS
SECTION TWO:
Statistics Pertaining to Federal Order 41, as Amended (Continued)
Table Page
No. No.
22 Fluid Milk, Fluid Skim Milk and Fluid Cream on Which Location
Adjustments were Allowed to Handlers under Order 41, as
Amended, September, 1946-December, 1946 26
23 Annual Milk Receipts from Producers, and Number of Producers
by States, and Entire Milkshed, Chicago Market under Federal
Milk Order 41, (Original and as Amended) 1940 through October,
1946 27
24 Average Daily Producer Deliveries of Milk, with Variations in
Actual Pounds from Low Month Each Year, and Seasonal Indexes
by Zone Groups and Entire Market, by Months, 1940-1946 under
Order 41, Original and as Amended 28
Table 24, continued 29
25 Butterfat Tests of Producer Milk Deliveries by Zone Groups and by
Months, 1940-1946 and Butterfat Tests of Class I Milk by Months
1942-1946 under Order 41, Original and as Amended 30
Table 25, continued 31
26 Number of Producers by Zone Groups under Order 41, Original and
as Amended, January, 1940-December, 1946 32
Table 26, continued 33
27 The Amount of Buttermilk and Chocolate Drink and the Butterfat
in These Products Disposed of by Handlers under Federal Order 41,
as Amended, January, 1945 through December, 1946 34
28a Butterfat in Frozen Cream Stored in an Approved Warehouse
under Order 41, as Amended, January, 1942-December, 1946 35
28b Butterfat in Frozen Cream Stored in an Unapproved Warehouse
under Order 41, as Amended, January, 1942-December, 1946 35
29 Summary of Pounds of Butterfat Used in Ice Cream Mix under
Order 41, as Amended, January, 1942-December, 1946 36
30 The Total Butterfat Shrinkage for Handlers under Order 41, as
Amended, Shown as a Percent of Total Butterfat in Producer
Receipts plus Butterfat Overrun by Months, January, 1943-
December, 1945 37
31 Variations in Butterfat Content Based on Mojonnier Tests of Skim
Milk Used in Manufactured Dairy Products by Handlers under
Order 41, as Amended 38
32 Reproduction of Tables Showing Yields of Solids-not-fat Related
to Butterfat Tests of Milk, from Wisconsin Research Bulletin 143,
by Froker and Hardin, published February, 1942 39
33 Variations in Yields of Nonfat Dry Milk Solids per Hundredweight
of Skim Milk at Certain Handlers' Plants 40
34 Average of Condensary Prices per Hundredweight of 3.5% Milk:
18 Plant Prices Used under Order 41, as Amended, Compared with
23 Plant Prices as Pi'oposed 41
35 Averages of Prices for Roller and Spray Process Nonfat Dry Milk
Solids for Human Consumption f.o.b. Chicago and f.o.b. Plants in
Chicago Area, July, 1943 through December, 1946 42
36 Results of Butterfat Tests of Chocolate Drinks as Prepared and
Sold by 26 Handlers in the Chicago Market before and after Adding
the Chocolate Flavor during October, November and December,
1946 under Order 41, as Amended 43
37 Handlers Who Operate Country Plants Grouped According to
Butterfat Receipts Disposed of to Distributing Handlers in Market-
ing Area under Order 41, as Amended 44
38 Handlers under Order 41 with Suburban Health Permits Only,
Grouped According to the Percentage of Class I Sales in Order
Marketing Area, and Showing the Total Class I Sales in Both
Marketing Areas under Orders 41 and 69 and the Number of
Handlers in Each Group, September, 1943 through August, 1944 45
TABLE OF CONTENTS 41b
SECTION THREE:
Statistics Showing General Industrial, Agricultural, and Dairy Price
Information
Table Page
No. No.
1 Index Numbers of Prices Paid by Farmers for Commodities Bought 1
2 Index Numbers of Cost of Goods Purchased by Wage Earners and
Lower Salaried Workers, Chicago, Illinois, 1935-1946 2
3 Average Monthly Wages (with board) Paid to Hired Farm Labor
in Illinois, Indiana, Michigan, and Wisconsin, with Index Numbers
for the Years 1935-1946, and Quarterly, 1943-1947 3
4 Number of Cows and Heifers Two Years Old and Over Kept for
Milk on Farms in the United States, Illinois, Indiana, Michigan,
and Wisconsin, as of January 1, and Index Numbers, 1935-1946 4
5 Pasture Conditions the First of the Month in Illinois, Indiana, Wis-
consin, and Michigan, 1936-1946 5
6 Precipitation and Departure from Normal in Chicago, Illinois,
1941-1947 6
7 Farm Stocks on Farms and Production of Wheat, Corn, Oats, and
all Hay in the United States, Illinois, Indiana, Wisconsin, and
Michigan, 1942-1946 7
Table 7, continued 8
8 Prices Paid by Farmers for Middlings, per Hundredweight in the
United States, Illinois, Indiana, Michigan, and Wisconsin, 1941-1947 9
8a Prices Paid by Farmers for Bran, per Hundredweight in the United
States, Illinois, Indiana, Michigan, and Wisconsin, 1941-1947 10
8b Prices Paid by Farmers for Cottonseed Meal per Hundredweight
in the United States, Illinois, Indiana, Michigan, and Wisconsin,
1941-1947 11
9 Prices Received by Farmers for Milk per Hundredweight in the
United States, Illinois. Indiana, Wisconsin, and Michigan, with
Index Numbers, 1940-1947 12
Table 9, continued 13
10 Index Numbers of Production Worker Employment in Manufac-
turing Industries by Metropolitan Area, Chicago Metropolitan
Area, 1937-1946 14
10a Index Numbers of Production Worker Employment in Manufac-
turing Industries by Metropolitan Area, Chicago, Illinois, 1937-1946 15
10b Index Numbers of Production Worker Employment in Manufac-
turing Industries by Metropolitan Area, Gary, Indiana, 1937-1946 16
11 Index Numbers of Production Worker Employment in Manufac-
turing Industries in the Chicago Metropolitan Area, Chicago,
Illinois, and Gary, Indiana, 1940-1946 17
12 Dealers' Retail Selling Prices per Quart of Milk Delivered to
Homes, Chicago, Illinois, 1919-1947 18
13 Retail Selling Prices per Quart of Milk at Stores, Chicago, Illinois,
1919-1947 19
14 Wholesale Prices of 40 Percent Cream in 40 Quart Cans, at Boston,
Massachusetts, 1942-1947 20
15 Range in Average Wholesale Prices per 40 Quart Can of New
York City Inspected 40 Percent Cream in New York, 1940-1947 21
16 Range in Average Wholesale Prices per 40 Quart Can of 40 Percent
Cream in Pennsylvania, Newark and Lower Merion Township,
1942-1947 22
17 Average Wholesale Prices per Pound of 92-Score Creamery Butter
at Chicago, 1919-1947 23
18 Average Wholesale Price of Cheese "Twins", per Pound on the
Wisconsin Cheese Exchange, 1919-1947 24
41c TABLE OF CONTENTS
SECTION THREE:
Statistics Showing General Industrial, Agricultural, and Dairy Price
Information (Continued)
Table Page
No. No.
19 Monthly Carlot Price per Pound of Spray and Roller Process Non-
fat Dry Milk Solids for Human Consumption, f.o.b. Chicago, July,
1941-1947 25
Table 19, continued 26
20 Carlot Prices per Pound of Spray and Roller Process Non-fat Dry
Milk Solids for Human Consumption, f.o.b. Manufacturing Plants
in Chicago Area, July, 1943-1947 27
21 Average Prices for Dry Skim Milk, 1932-1946 28
22 Average Price per Cwt. Paid by Evaporated Milk Plants in the
North Central States for 3.5 Percent Milk Compared with the
Calculated "Formula Code Prices" as Set Forth in the Evaporated
Milk Agreement 29
23 Annual Receipts of Fluid Cream at New York and Metropolitan
Area, by States of Origin, 1942-1946 30
24 Parity Prices and Average Prices Received by Farmers for Milk
per Hundredweight in the United States and Chicago, Illinois,
November and December, 1945, with Comparison for November
and December, 1944 31
24a Parity Prices and Average Prices Received by Farmers for Milk
per Hundredweight in the United States and Chicago, Illinois,
December, 1946 and January 1947, with Comparison for December,
1945 and January, 1946 31
25 Parity Prices and Average Prices Received by Farmers for Milk
per Hundredweight in the United States and Suburban Chicago,
Illinois, Grade A, IsTovember and December, 1945, with Comparison
for November and December, 1944 32
25a Parity Prices and Average Prices Received by Farmers for Milk
per Hundredweight in the United States and Suburban Chicago,
Illinois, Grade A, December, 1946 and January, 1947, with Com-
parison for December, 1945 and January, 1946 32
26 Parity Prices and Average Prices Received by Farmers for Milk
per Hundredweight in the United States and Suburban Chicago,
Illinois, Grade B, December, 1946 and January, 1947, with Com-
parisons for December, 1945 and January, 1946 33
27 Average Price per Ton of 16 Percent Mixed Dairy Feed, United
States, 1940-1947 34
28 Estimated Total Milk Production on Farms in the United States,
Illinois, Indiana, Michigan, and Wisconsin, with Percentage Change
from Previous Year, 1940-1947 35
Table 28, continued 36
29 Estimated Total Milk Production on Farms in the United States,
Illinois, Indiana, Michigan, and Wisconsin with Index Numbers,
1935-1946 3^
30 Estimated Milk Production per Cow in the United States, Illinois,
Indiana, Michigan, and Wisconsin with Index Numbers, 1935-1946 J»
31 Estimated Number of Milk Cows on Farms in the United States,
minois, Indiana, Michigan, and Wisconsin, with Index Numbers,
1935-1946 ^^
32 Average Retail Prices of Evaporated Milk, 14 Va -ounce Can, with
Index Numbers, Chicago, Illinois, 1935-1947 4U
33 Prices Received by Farmers for Butterfat per Pound in the United
States, Illinois, Indiana, Michigan, and Wisconsin, with Index
Numbers, 1940-1947 ^^
Table 33, continued ^^
TABLE OF CONTENTS 41d
SECTION THREE:
Statistics Showing General Industrial, Agricultural, and Dairy Price
Information (Continued)
Table Page
No. No.
34 Prices Received by Farmers for Corn per Bushel in the United
States, Illinois, Indiana, Michigan, and Wisconsin, with Index
Numbers, 1940-1947 43
Table 34, continued 44
35 Prices Received by Farmers for Oats per Bushel in the United
States, Illinois, Indiana, Michigan, and Wisconsin, with Index
Numbers, 1940-1947 45
Table 35, continued 46
36 Prices Received by Farmers for Hogs per Hundredweight in the
United States, Illinois, Indiana, Michigan, and Wisconsin, with
Index Numbers, 1940-1947 47
Table 36, continued 48
37 Prices Received by Farmers for Beef Cattle per Hundredweight in
the United States, Illinois, Indiana, Michigan, and Wisconsin, with
Index Numbers, 1940-1947 49
Table 37, continued 50
38 Prices Received by Farmers for Alfalfa Hay per Ton in the United
States, Illinois, Indiana, Michigan, and Wisconsin, with Index
Numbers, 1940-1947 51
Table 38, continued 52
39 Prices Received by Farmers for Clover and Timothy Hay Mixed
per Ton, in the United States, Illinois, Indiana, Michigan, and
Wisconsin, with Index Numbers, 1940-1947 53
Table 39, continued 54
40 Prices Received by Farmers for Milk Cows per Head in the United
States, Illinois, Indiana, Michigan, and Wisconsin, with Index
Numbers, 1940-1947 55
Table 40, continued 56
41 Cash Income from Dairy Products Sold from Farms in the United
States, Illinois, Indiana, Michigan, and Wisconsin, with Index
Numbers, 1935-1945 57
42 Cash Receipts from all Farm Marketings Including Government
Payments and Percentage Cash Income from Dairy Products was
of Cash Receipts from all Farm Marketings in the United States,
Illinois, Indiana, Michigan, and Wisconsin, 1935-1945 58
43 Gross Income from Dairy Products on Farms in the United States,
Illinois, Indiana, Michigan, and Wisconsin, with Index Numbers,
1935-1945 59
APPENDIX 9
BY-LAW No. 2990
A BY-LAW TO REGULATE AND LICENSE THE PRODUCTION, SALE
AND DISTRIBUTION OF MILK, CREAM AND MILK PRODUCTS.
INTERPRETATION
1. In this By-Law:
(a) "License" shall mean a license to sell milk or cream or milk products
for human consumption;
(b) "Council" shall mean the Municipal Council of the City of Brantford;
(c) "Medical Officer of Health" shall mean a medical officer of health for
the county of Brant;
(d) "Sanitary Inspector" shall mean a sanitary inspector for the County
of Brant;
(e) "Pasteurized" shall mean milk or cream which has undergone the
process of pasteurization;
(f) "Pasteurization" shall mean the process of heating every particle of
milk to a temperature of not less than 143 degrees Fahrenheit, of
holding it at such temperature for not less than 30 minutes, or such
other temperature and time as may be set by Lieutenant-Governor
in Council and of cooling it immediately thereafter to 50 degrees
Fahrenheit or lower. Public Health Act, R.S.O. 1937, Chapter 299,
sec. 1(00).)
LICENSE REGULATIONS
2. No person shall sell or offer for sale, milk or cream for human consump-
tion in the City of Brantford or directly to the consumer or shops or stores
or in wholesale quantities to any person to be afterwards sold or delivered
by such person to the consumer without first obtaining a license under the
provisions of this By-Law.
3. Evei'y person proposing to apply for such license shall apply to the
Clerk of the municipality of the City of Brantford. Before issuing such
license it shall be the duty of the Clerk to give the Medical Officer of
Health the name of the applicant and his address in order that inspection
may be made of the premises and equipment for the purpose of ascertaining
whether they conform to the requirements of the Milk and Cream Act, this
By-Law and other statutes applicable to dairies, the production or sale
of milk or cream or milk products.
4. No license shall therefore be granted or issued until the Clerk shall
have first obtained the signed approval from the Medical Officer of Health.
Similarly the Medical Officer of Health shall be notified of any transfers
of licenses.
5. It shall be the duty of the Medical Officer of Health:
(a) To ascertain the truth of all particulars accompanying such applica-
tions;
(b) To cause an inspection to be made of all premises in connection with
which any license is applied for;
(c) To satisfy himself as to the character of all applicants for licenses;
(d) To keep full particulars of every application and transfer issued;
(e) To furnish all necessary forms and to make out and sign all applica-
tions and transfers;
(f) To inspect all premises, the owners or occupants of which are
licensed under this By-Law;
(g) To cause all persons who offend against any of the provisions of the
Milk and Cream Act or of this By-Law or of any amendments thereof
to be prosecuted whenever information to that end shall come to his
knowledge;
6. A separate license shall be taken out for each place or premises at
which the applicant carries on his business or a part thereof.
[42]
APPENDIX 9
43
7. Every license, unless it is expressed to be issued for a shorter period, or
unless it shall become sooner forfeited, shall be for the year current at the
date thereof, and shall expire on the last day of December after the date
thereof, and in this By-Law for the year current shall mean a period
commencing on the first day of January, 1947, and ending on the 31st day
of December, 1947.
8. Every person possessing a license and his servant or employee employed
in selling milk or cream shall produce and exhibit the license thereof
whenever required by the Medical Officer of Health, or other officials of
the Brant County Health Unit, or by any police constable.
9. The Medical Officer of Health may, in his discretion, refuse or suspend
any license, subject however to review by the Council.
10. Except so far as authorized by Sec. 4, a license shall not be trans-
ferable.
11. The Medical Officer of Health may grant a license to the representa-
tive of a license holder who dies or makes an assignment for the benefit
of creditors during the currency of the license, to continue the business
until expiration of his license.
REGULATIONS REGARDING THE PRODUCTION OF MILK
12. (a) Care of Milk Cows: Milk cows must be kept clean and shall not be
abused in any way. Udders and flanks shall be clipped twice yearly.
The teats and udders of such cows are to be wiped with a damp cloth
before each milking so as to remove thoroughly from them all
manure and foreign substance which may contaminate the milk.
(b) Health of Cows: No milk shall be sold, held for sale or offered for
sale from any milk cow that has any ailment that would affect the
quality or wholesomeness of the milk and any cow subject to such
ailment shall be removed and kept separated from the milking herd.
(c) Food for Cows: Only clean wholesome food shall be given to milk
cows. No strong flavoured food which shall affect the odor or taste
of the milk shall be fed to milk cows at any time.
(d) Water for Cows: All water supplied or available to milk cows for
drinking and all water used in cleansing utensils, must be clean, pure
and protected from any danger of pollution.
(e) Sanitary Conditions of Stahles: The stable in which milk cows are
kept or in which they arc milked must be kept clean and in a
sanitary condition. It must be provided with an adequate supply of
light; it must be well ventilated, and free from dust and cobwebs;
it must be provided with an efficient manure gutter, which must be
kept properly cleaned night and morning, the floor made tight and
be provided with proper slope for drainings, no pigs kept in the
stable, the walls and ceilings of the stable shall be whitewashed each
spring and autumn.
(f) Milk House: A milk room separate from the other rooms must be
provided which shall be used only for the purpose of storing milk
and milk utensils. It shall be so constructed as to be kept clean, cool
and sanitary at all times. Cement floors shall be used and shall be
properly drained towards an outlet. Milk coolers shall likewise be
made of cement, shall be so constructed as to be kept clean and in
a sanitary condition and in a good state of repair. Where water is
used to cool the milk it shall be clean, pure and protected from any
danger of pollution. Windows and doors shall be suitably constructed
and screened during the fly season. There must be no direct com-
munication between it and the stable, or any living room, or where
manure is piled.
(g) Excluded Milk: No milk shall be forwarded to the municipality of
the City of Brantford for sale obtained from any cow within six
weeks before and 10 days after parturition. Likewise, no milk shall
be allowed to enter the municipality of the City of Brantford which
is ropey, has an off-flavour or a bitter flavour, is dirty or adulterated,
or which has any other abnormality.
(h) Small Animals: Cats and dogs must be excluded from milk houses
and cow stables during milking hours,
(i) Persons engaged in milking: Every person engaged in milking cows
must be in good health, be free from contagion of any kind, must
44 APPENDIX 9
be cleanly dressed, and must be personally clean at the time of
milking and of handling the milk in the milk house.
Any person milking cows, and in whose family any contagious
disease occurs, must absent himself or herself at once from the dairy
and stable until the Medical Officer of Health certifies that it is safe
for him or her to return.
(j) Utensils and Cooling: All milk utensils must be kept thoroughly
clean and sterilized before use, and the process of milking and of
handling milk in stable and milk house be such as will ensure a
supply of clean, fresh milk.
(k) Premises: All yards and premises adjoining cow stables and milk
houses shall be maintained in a sanitary condition. No manure dirt,
nor decayed matter shall be allowed to accumulate in such yards or
premises or milk houses, or within fifty feet of the same, and shall
be removed at frequent intervals.
Milk shall not be allowed to stand in the stable but shall at once be
removed to the milk house, strained through a sterilized gauze and
cooled to a temperature of fifty degrees Fahrenheit and kept at or
below that temperature until shipped.
13. All persons selling, holding for sale or offering for sale, cream or
milk within the City of Brantford or owning or operating dairies within
the limits of the City of Brantford shall comply with and observe and
perform the regulations as set down by the Ontario Department of Health,
on Regulations of Milk Pasteurization Plants.
14. The Medical Officer of Health shall be the person to enforce the pro-
visions of the Milk and Cream Act and this By-Law and of any regulations
enacted by the Council under the authority of the said Act, and for such
purposes he shall have and may exercise all the powers conferred by the
Milk and Cream Act and any amendment thereof.
If upon examination and inspection any milk or cream appears to the
Medical Officer of Health to be dirty, adulterated or in any way unfit for
human consumption, he shall treat, destroy or cause to be destroyed, as he
may see fit, all such milk so as to prevent it from being exposed for sale
or used for human consumption.
Cream shall contain 18% butter fat and no milk shall be sold as cream
containing lesser per cent of butter fat unless such lesser per cent is clearly
shown upon the vessel from which such cream is supplied.
15. All dairymen and vendors of milk, cream, and all drivers of milk
wagons and vehicles having milk or cream in their possession at the
time, shall furnish the Medical Officer of Health with such samples as he
may require from time to time and at such places as the samples may be
demanded. All milk wagons and motor vehicles used to transport milk
either to the dairy, or in the delivery to the consumer or vendor, shall be so
constructed and maintained so as at all times to be in a sanitary condition.
16. The Medical Officer of Health shall properly identify all such samples
of milk and cream for laboratory examinations.
17. On receipt of the laboratory report the Medical Officer of Health
shall notify the dairy and he shall take such action as to him seems
necessary through information gained from the report.
18. Every person vending or offering milk or cream for sale in the City
of Brantford shall give full information to the Medical Officer of Health as
to the source of his supply and shall not sell milk or cream from any source
condemned by the Medical Officer of Health and shall notify the Medical
Officer of Health within 24 hours upon taking on or discontinuing any
supply of milk or cream.
19. The onus of proof that milk seized under this By-Law was not in-
tended for sale in the City of Brantford shall be upon the party charged.
PENALTIES
Any person contravening any of the provisions of this By-Law shall
incur a penalty of not less than $1 nor more than $50 recoverable under
The Summary Convictions Act.
Passed this Twenty-third day of September, 1946.
Sgd. E. J. Campbell, Sgd. J. H. Matthews.
City Clerk. Mayor.
APPENDIX 9 45
I hereby certify that the foregoing is a true, accurate and correct copy
of By-Law No. 2990 of the City of Brantford, passed on the Twenty-third
day of September, 1946.
Sgd. E. J. Campbell,
City Clerk.
The provisions of By-Law No. 2990 of the City of Brantford which have
been passed under section 2 of The Milk and Cream Act are hereby
approved. Dated at Toronto this Twenty-first day of October, 1946.
Sgd. Thomas L. Kennedy,
Minister of Agriculture.
APPENDIX 10
THE LOCAL BRANCHES OF THE ONTARIO MILK PRODUCERS'
LEAGUE
The membership of the League is divided into districts or markets
known as "locals" as follows:
Algoma
Acton
Aylmer
Barrie
Brantford
Blenheim
Belleville
Bracebridge
Brampton
Brockville
Bowmanville
Campbellford
Chatham
Cobourg
Collingwood
Cornwall
Durham.
Delhi
Elmira
Essex
Fort Frances
Gait
Gananoque
Georgetown
Guelph
Gravenhurst
Hamilton
Hanover
IngersoU
Kenora
Kingston
Lindsay
Lincoln
London
Midland-Penetang
Niagara Falls
North Bay
North Muskoka
Orillia
Oshawa
Ottawa
Oakville
Owen Sound
Paris
Peterboro
Pickering
Picton
Port Elgin and Southampton
Port Hope
Port Colborne
Prescott
Renfrew
Ridgetown
St. Marys
St. Thomas
Sarnia
Simcoe-Waterford
Smiths Falls
Stratford
Thunder Bay (Port Ai'thur and
Fort William)
Tillsonburg
Temiskaming
Thorold-Merritton
Toronto
Trenton
Twin Cities
Walkerton
Wallaceburg
Woodstock
Wiarton
Welland
Whitby
(Kitchener and
Waterloo)
[46
APPENDIX 11
PROBLEMS OF THE DAIRY FARMER'S WIFE AS PRESENTED
TO THE ROYAL COMMISSION
December 16, 1946
The dairy farmer's wife is an "Active" partner with her husband and
family in carrying on the work of a dairy farm, and therefore I feel has
a right to make representation to you. Sir. She is up and on the job early
in the morning. She takes charge of her kitchen range and the furnace in
the basement. She often finds it necessary to go to th^ stable to assist in
milking the cows, taking with her one or two young children, whom she
cannot leave alone, and placing them in a box or cage, where she can keep
an eye on them while she works. She hurries back to her kitchen when
milking is completed to prepare breakfast for her husband and his hired
men, as the majority of the milk for Ottawa leaves the farm by truck after
being cooled before 7.00 a.m.
Her morning's work has just begun. She now tackles the job of cleaning
and sterilizing dishes, pails, cans, milking machine, etc., before she can turn
to the task of setting her house in order. This task in itself is not an easy
one. Her scrubbing and sweeping and dusting and making beds must be
done before she can turn to the task of preparing dinner for her family and
hired men whom of necessity she must board, house and, worst of all, do
their laundry.
Early afternoon may be free from the mad rush of the morning's work.
This part of the day is devoted to catching up with the million odds and
ends that have been neglected, besides the ironing and sewing and mending
that are a necessary part of her day's work.
Late afternoon, however, finds her often again in the stable. Dressed
in overalls and smock, and keeping a watchful eye on her babies in their
cage, she spends a couple of hours milking cows and cleaning dairy utensils.
She then prepares and serves supper to her family and hired men. More
dishes are to be washed; and many neglected odd jobs occupy most of her
evenings. This does not allow Saturday afternoon free, the cows are a
seven day care.
The life of a dairy farmer's wife is hard. Her hours are long; her work
arduous and often distasteful. Necessity drives her beyond her strength
to her humdrum tasks 365 days in the year. There is no let-up — little
diversion. She cheerfully gives her life that others may be fed. She
occasionally goes to town — sees men and women and boys and girls lined
up at the beer store. She wonders why they complain so much about
paying fifteen cents for a quart of milk when they so gladly pay thirty-five
cents for a quart of beer or similar amounts for soft drinks, etc.
She is not paid commensurate with this work. Income tax officials will
not allow it as an expense against income. Yet it enters directly into the
cost of producing milk.
The dairy farmer's wife has a real problem in the matter of housing
labourers. Sometimes he is a fine agreeable fellow; often he is quite the
reverse. No matter what he is, she sees him by force of circumstances
admitted to the intimacies of her children's conversation at meal-time and
in the evenings. She hesitates to leave them alone in his company. She
smarts under the injustice of having him monopolize the living room and
the radio, yet she feels she cannot protest. Her husband needs him, and
the work must be done.
The necessity of living and working under ^ii'cumstances that are not
pleasant when compared with those oi fier sisters who have married
professional men, business men, mechanics, or labourers has a psychological
effect on the dairy farmer's wife. Few seem to understand. No one seems
capable of evolving a solution. In bitterness of heart, she resolves that
her daughter will not be as she. She encourages her to leave the farm, to
[47]
48 APPENDIX 11
seek a career in the city. And thus the drift from farm to town goes on
from decade to decade, and it will continue until the farmer receives a
price for his produce that will enable him to pay wages that will attract
labour to the farm and will enable him to provide separate and comfortable
living quarters for married help.
The lowest paid labourer's wife in the city has more conveniences than
many or most of the dairy farmer's wives. The conveniences were denied
many farmer's wives not for lack of desire of her loving husband but
because of lack of finances.
I am a farmer's wife by choice. There are many things I like about it and
all I ask is that a fair price or return for our labour be assured us and I
will be happy to see my children follow their father's business, but one
hesitates to persuade them when you can promise them so little except
fresh air and a good night's sleep.
One thing that seldom has been considered in farming is holidays. City
people feel because they holiday in the country the farmers are always
so privileged. Help on the farm is seldom provided to allow for a spare.
Urban industries find it necessary to do so and charge this cost to overhead.
If one leaves the farm or is ill the remaining help must do his work. This
is generally passed on to Mrs. Farmer. Few farmers' wives can allow
themselves holidays either for lack of help or money to enjoy such.
Sir, in conclusion may I ask you to study this matter in your wisdom, but
particularly blend your findings with the facts that farm women should
have and would like the possibility of a little nail polish, an occasional
permanent, and perhaps a tiled bathroom. This, Sir, can never be ours if
milk goes back to former prices, and if my daughter refuses to marry a
farmer for fear of lack of those things every lady loves, it is going to be
bad for the future of Ottawa and Canada. The lack of ability to live with
conveniences on a farm has made many a girl break a romance and left
farms deserted while the boy turned to city employment. We only want
our share of the nation's wealth, no more — no less.
APPENDIX 12
FARM EXPENSES HAVE RISEN SHARPLY SINCE 1939
The dairy farmer has many items of expenditure, both for commodities
used in farm production and also for articles needed for the maintenance
of his household.
The Dominion Bureau of Statistics publishes two valuable indexes which
show the changes in prices for these two groups of expenditures. One
index showing the prices of commodities used in farm production in eastern
Canada indicates a rise from 98.9 for the year 1939 to 150.2 in August 1946.
This index comprises implements, fertilizers, seed, feed, gasoline and oil,
building materials, hardware, binder twine, taxes, interest on mortgages,
and farm wages.
It is common knowledge that prices of food, clothing, fuel, furniture, and
other household items have advanced greatly, and the farmers' income
has definitely much less purchasing capacity in respect to purchases of this
type than in 1939. Clothing in general has risen 38.3% since 1939, fuel is up
19% notwithstanding the fact that it is still subsidized, and household
equipment 36%. Wages of industrial employees have been progressively
raised to cope with the increase in the prices of these commodities, and it
is just as necessary that dairy farmers also obtain corresponding improve-
ment in their income.
49]
50
APPENDIX 12
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APPENDIX 12
51
AVERAGE RETAIL PRICES IN ONTARIO OF COMMODITIES
USED BY FARMERS
AUGUST, 1939, AUGUST, 1945 and AUGUST, 1946
Average wages of farm help, with board
Motor Supply
Gasoline per gallon
Motor Oil per gallon
Building Materials
Spruce scantling M
Shingles (cedar) bundle
Brick M
Portland cement bag
Window glass sq. foot
Roofing paper roll
Feed
Oats bushels
Barley bushels
Com bushels
Wheat bushels
Bran cwt.
Middlings cwt.
Hay ton
(A) 1. Linseed Oil Cake Meal. . . cwt.
2. 24 'Jo Dairy Ration cwt.
3. 16% Dairy Ration cwt.
(A) Fertilizers
2-12-6 •
0-12-6
Hardware
Milk Can 8 gallons
Dairy Pail
Wire fencing per rd.
Implements
Tractor, 4 cylinder, 9-38', 4-ply
tires
Plow
Binder
Drill
Rake
Drag Harrow
Disc Harrow
August
1939
824.00
August
1945
$64.34
August
1946
$68.40
.28
.345
.345
1.26
1.34
1.34
41.19
64.83
65.00
1.20
1.80
1.78
24.93
33.33
35.00
.67
.73
.73
.11
.15
.16
2.57
2.95
2.97
.42
.65
.65
.59
.84
.83
.85
1.37
1.46
.73
1.10
1.12
1.20
1.45
1.45
1.35
1.66
1.66
11.79
20.50
19.81
2.00
—
2.25
2.45
—
2.70
2.30
—
2.35
29.25
29.00
31.20
25.75(0-14
7) 27.75(0-14-7) 30.35
6.53
8.43
8.52
.74
.83
.88
.50
.51
.57
974.00
1,048.00
Prices
21.00
23.00
were
256.00
300.00
advanced
168.00
187.00
generally
57.00
63.00
12^%
26.00
28.00
in 1946
56.00
62.00
(A)— U.F.O prices
Agricultural Division. Dominion Bureau of Statistics, Ottawa.
7-,2 APPENDIX 12
CONSUMERS HAVE HIGHER INCOMES AND CAN AFFORD
TO PAY SUFFICIENT FOR MILK
TO ASSURE FARMERS COST OF PRODUCTION
Urban residents have considerably more money to-day than in 1939, and
have benefited greatly from improved economic conditions. The index of
employment compiled by the Dominion Bureau of Statistics, Ottawa, indi-
cates the higher level of industrial activity prevailing to-day. In the city
of Hamilton the index of employment, base 1926=100, has risen from 103.7
in 1939 to 175.9 in July 1946.
The Dominion Bureau of Statistics, Ottawa, also compiles data on average
hourly wage rates for various occupations in Ontario industries. The
following table indicates the very substantial gains recorded since 1939 by
workers in rubber industry, steel mills, and electrical machinery. Hamilton
is an industrial city and has factories of these types located there. The
percentage change from 1939 to October 1946 ranged from 54.7% to 113.7%
according to the figures below, with the average of all increases amounting
to 74.7%.
Another indicator of the improved purchasing power of consumers is
contained in the figures of the net national income of Canada, which rose
from $4,221,000,000 to $9,627,000,000 in 1945, a gain of 128.1%.
The amount of Children's Allowances paid in Ontario during the twelve
months ending June 30, 1946 totalled $66,411,180. This has added greatly
to the consumers' ability to pay a reasonable retail price for fluid milk.
Total sales of milk in Ontario during the twelve month period ending
August 1946, was 468,000,000 quarts. A three-cent per quart increase in
the price for milk amounts to $14,040,000, which is less than 25% of the
amount currently being received from Children's Allowances.
Still further indications of the greater spending capacity of the general
public are very clearly brought out by the figures in the table below
showing expenditures on luxury and amusement items. Beer sales in
Ontario increased by 142% between the fiscal year 1938-39 and the fiscal
year 1944-45. Amounts wagered at race-tracks in Ontario rose 101%
between 1939 and 1945, with a further increase anticipated for 1946. Theatre
admissions in Ontario for the same comparison increased 53.8% and the
production of cigarettes in Canada has more than doubled since 1939.
APPENDIX 12
53
AVERAGE HOURLY WAGE RATES FOR SELECTED OCCUPATIONS
IN CERTAIN ONTARIO INDUSTRIES
Years 1939. 1945, and 1946
(Male Workers Only)
Occupations
Rubber Products
Cutters
Millmen
Curers
Shoe Makers
Tire Builders
Crude Rolled and Forged Products
Electricians
Labourers
Machinists
Millwrights
Welders
Electrical Machinery, Etc.
Sheet Metal Workers
Coil Winders
Platers
Inspectors
Labourers
Average of above percentage increases .
939
1945
October
% Change
$
$
1946 October 1946
.809
$
from 1939
484
.939
+
94.0%
554
.775
.905
+
63.4%
614
.891
1.021
+
66.3%
484
.707
.837
+
72.9%
714
.997
1.127
+
57.8%
656
.886
1.016
+
54.9%
434
.641
.771
+
77.6%
595
.869
.999
+
67.9%
620
.829
.959
+
54.7%
604
.845
.975
+
61.4%
408
.742
.872
+
113. 77o
523
.814
.944
+
79.8%
458
.734
.864
+
88.6%,
504
.816
.946
+
87.7%
419
.623
.753
+
79.7%
+ 74.7%
Figures for 1946 obtained by adding 13 cents per hour to 1945 figures to allow
for recent increases.
Figures for 1939 and 1945 supplied by Research and Statistics Branch, Dominion
Department of Labour, Ottawa.
APPENDIX 12
INDEX OF EMPLOYMENT
1926 =
= 100
Canada
Ontario
Hamilton
1939
113.9
114.3
103.7
1940
124.2
129.2
124.4
1941
152.3
160.0
159.5
1942
173.7
179.4
186.6
1943
184.1
185.8
186.7
1944
183.0
184.7
180.8
1945
175.1
178.4
176.4
January
1946
168.2
172.2
169.1
February
1946
167.2
173.9
170.2
March
1946
167.0
173.6
168.9
April
1946
168.9
175.5
172.3
May
1946
169.3
176.7
172.8
June
1946
169.9
178.4
173.0
July
1946
173.6
179.6
175.9
Business Statistics Branch, Dominion Bureau of Statistics, Ottawa.
APPENDIX 12
55
SALARIES, WAGES, AND SUPPLEMENTARY LABOUR INCOME
CANADA
Total
(Millions
of Dollars)
ONTARIO
Per Total Population Per
Capita (Millions (OOO's) Capita
$ c of Dollars) $ c
1938 2,449 219.60
1939 2,540 225.44
1940 2,860 251.30
1941 3,529 306.68
1942 4,233 363.22
1943 4,790 405.52
1944 4,969 414.95
J945 5,037 (a) 415.63
(a) Preliminary
1,036
1,073
1,227
1,526
1,807
2,017
3,672
3.708
3,747
3,788
3,884
3,917
3,965
4,004
282.14
289.37
327.46
402.85
465.24
514.93
CANADA
Net National
Income at
Factor Cost
(Millions of
Dollars)
1938
1939
1940
1941
1942
1943
1944
1945
(a) Preliminary
Population
(OOO's)
3,940
4.221
5,112
6,514
8,277
9,069
9,685
9.627 (a)
11,152
11,267
11,381
11,507
11,654
11,812
11,975
12,119
National
Income
per Capita
$ c
353.60
374 63
449.17
566.09
710.23
767.78
808.77
794.37
Business Statistics Branch, Dominion Bureau of Statistics, Ottawa, Canada.
56 APPENDIX 12
CHILDREN'S ALLOWANCES
(a) Total amount paid in Ontario from July 1, 1945 to June 30, 1946 $66,411,180
(b) No. of children registered as at June 30, 1946 941,533
(c) Average payment per child for June 1946 S6.02
LUXURIES AND AMUSEMENTS
Beer Sales in Ontario Fiscal Year 1938-39— S26.200.053
Fiscal Year 1944-45— 863,502,830
% Increase 142.4%
All Alcoholic Beverages Sales in Ontario Fiscal Year 1938-39— $49,637,986
Fiscal Year 1944-45— $102,885,847
% Increase 107.3%
Amount Wagered at Race-tracks in Ontario Year 1939— $12,858,640
Year 1945— $25,907,764
% Increase 101.5%
Theatre Receipts m Ontario .' Year 1939— $15,247,941
Year 1945— $23,740,871
% Increase 55.7%
No. of Paid Theatre Admissions'in Ontario Year 1939— 59,686,373
Year 1945— 91,817,463
% Increase 53 . 8%
Production of Cigarettes in Canada Year 1939— 7,163,433,000
Year 1944— 15,484,605,000
% Increase 116.2%
Dominion Bureau of Statistics, Ottawa
APPENDIX 12
Ctnti
Hour
Averag* Hourly W»g« Ratai in Ontario
Yean 1939 and 1946
Cents
per
Year 1939 L;.' . ■ ' . ^^T^
Y..r 1946 v////i/inm\
p =
3 LvH rB [fl liH F H la Lfl — [^
r.=
r:
■.=
p:
a Kfl
/- ,»-- ^^ /
*-~-
notes prcDurrs
ELCCTRICAL MAClilNCnr
58
APPENDIX 12
200
Index of Employment
1926—100
200
Hamilton
180
160
140
120
100
<-> . Ontario
3"
180
160
140
120
i I
100
APPENDIX 12
59
National Income and Wages of Canada
Billion
Dollars
10
- 8
- 4
~ 2
APPENDIX 13
LIST OF FORMULAE USED IN CALCULATING COST OF
PRODUCING 100 POUNDS OF MILK
L The Misner Formula
Professor E. G. Misner of Cornell University states that, as a result of
a large number of studies made by Agricultural Experiment Stations in
different parts of the United States, the cost of producing 100 pounds of
3.5 test milk appears to be about 30 pounds of grain and other concentrates,
100 pounds of silage and other succulent feed, 60 pounds of hay and other
dry forage, and 2.5 hours of labour. The cost of these quantities of feed
and labour represents about 80 per cent of the total cost of production after
credits for manure and calves are deducted.
The Misner formula, therefore, reads as follows:
30 pounds of grain @ per ton =
100 pounds of silage @ per ton =
60 pounds of hay @ per ton =
2.5 hours of labour @ c per hr. =
The total feed and labour cost thus calculated = 80 per cent of the total
cost of producing 100 pounds of 3.5% milk.
2, The Hare Formula
In connection with the milk cost study carried on in Ontario during the
four years from 1936-37 to 1939-40 inclusive, Mr. H. R. Hare found that
the quantities of the various items entering into the cost of producing milk
tended to be fairly constant from year to year. This fact suggested that a
formula based upon quantitative data associated with current values might
serve as a means of determining changes in production costs as between
periods. To this end the following quantitative data was presented as
being applicable to the Toronto Whole Milk Zone.
Calculated basic quantities of Feed and Labour required to produce 100
pounds of milk for sale in the Toronto Whole Milk Zone:
Oats 21 lbs.
Barley 8 lbs.
Linseed Oil Meal 7 lbs.
Mixed Hay 80 lbs.
Silage 160 lbs.
Labour 3 hours
Hauling 29.9 cents'
By using the quantitative data presented above the cost of producing 100
pounds of market milk may be determined by applying values to the
several items as follows:
Oats The farm price of oats as presented in the Ontario
Monthly Crop Report, Toronto.
Barley Same as for oats.
Linseed Oil Meal The wholesale price of Linseed Oil Meal as quoted
Montreal wholesale F.O.F. ton lots.
Mixed Hay The average values of the two classes of hay (1) hay
and clover and (2) alfalfa as quoted in the Ontario
Monthly Crop Report.
Silage The value of silage may range from $3 to $5 per ton
depending upon the average yield as shown by the
Ontario Monthly Crop Report, Toronto. For an 8 ton
yield the value should be set at $5 whereas it should
be set at $3 for a yield of 11 tons. For each additional
ton per acre above 8 tons the value per ton should be
reduced by 66 cents.
Labour The value of labour should be set at 16.5 cents per
hour weighted by current farm wage rates as follows:
16.5 X (average wage of males per month, incl. board)
36 7""
The wages of male help to be used is that determined
by the Bureau of Statistics, Ottawa.
[60]
APPENDIX 13 Ql
To the sum of the costs thus calculated, add 29.9 cents to cover delivery
charges from the farm to the distributing plants in Toronto The total
arrived at represents approximately 75 per cent of the gross cost of pro-
ducing whole milk. Other costs to be considered include pasture, use of
dairy buildings and equipment, interest on dairy livestock at 4 per cent
depreciation of dairy livestock, a proportion of the farm expenses for taxes'
insurance, telephone and electricity chargeable to the dairy enterprise, and
general dairy expenses incurred for dairy equipment repairs, fly spray
pedigree registration of cattle, disinfectants and other incidentals These
items represent 25 per cent of the gross cost of producing milk.
Appreciation of dairy livestock and the value of milk used by other live-
stock represent a credit approximating 13 per cent of the gross cost There
remains 12 per cent of the cost (25 - 13 = 12) to be added to the cost thus
far determined To the sum of the items already calculated, add 12 per
cent. The total will represent the cost of production for the period repre-
sented by the prices used in the calculation.
^. Cunningham Formula
Estimated cost of Producing Milk by Formula*— The cost of producing
milk may be calculated by formula by applying current prices to the
physical quantities of feed and labour required to produce a given amount
of milk. In table 7 you are shown the approximate amounts of grain hay
silage pasture and labour required in the production of 100 pounds of
milk, based on cost-of-production studies in the period 1930 to 1936 These
items made up 90 per cent of the net cost of milk. Feed prices and wage
rates for any particular period may be used to calculate the values of these
Items. The total of the values divided by 90 and multiplied by 100 gives
the calculated net cost of producing 100 pounds of milk.
No^T^ "Costs in Dairy Farming" by L. C. Cunningham, Cornell Extension Bulletin
Table 7— ESTIMATED COST OF MILK BY FORMULA
Items Formula
Approximate amounts required to Cost to Produce
produce 100 pounds of milk. Prices 100 pounds of milk.
g*^'" 33 pounds x per pound =
"fy 70 pounds X per pound=
silage 100 pounds X perpound=
Pasture 2. 3 days x per dav =...
Labour 2.6 hours x per hoiir = ;.;;:;;;;;;:;.'
Total for feed and labour (90 per cent of net cost)
Yearly average cost (100 per cent) '.'.'.'.'.'.'.'.'.'.'.'.'.".""
Formulas as summarized by Morrison
nf^y/^"^ simple formulas have been worked out for estimating the cost
of fTi?.?H°^"K^'°''- r^u *^r^ formulas all the costs are reduced to terms
labmfr ^^ .^''"''i therefore, by taking the current prices for feeds and
can rp;,H,-w vf o^' j^^s approximate estimate of the cost of producing milk
can readily be made at any time.
In using these items as a basis for calculating the cost of producing milk
t is assumed that as the prices of feeds and labour rise or fall the other
Items of expense and the credit items will fluctuate more or less in the
same proportion. Though the costs of all the factors probably never changi
of compar'isom''' "" ''''''"'^ ^""^ '^°'^^^ "^°"^^ ^"^^^^^^ for purposS
of^v^f ^T the formulas which has been used most widely is that of Warren
o prodS7rnn''.P'r^^^ ^^f^°". According to this formula, the cos"
Sst totpfw r ^''"^'^^''Jo'?' t '^'"'^^^ ^^^ York conditions is found by
urst totalling the cost of 33.8 lbs. concentrates, 43.3 lbs. hay, 10.8 lbs. of
62 APPENDIX 13
other dry roughage (corn stover, corn fodder, straw, etc.), 100.5 lbs. silage,
and 3.02 hours of man labour. This total represents 80 per cent of the
entire cost. Therefore it must be increased by one-fourth to determine the
approximate total cost of 100 lbs. of milk, according to the formula. The
Warren formula has been simplified by Misner, as shown in the following
table. This presents some of the formulas that have been proposed to meet
conditions in various districts.
COMPARISON OF FORMULAS FOR COST OF MILK PRODUCTION
Warren
Factors in Formula (N.Y.)
Concentrates lbs. 33 . 80
Hay lbs. 43.30
Other drv roughage . . lbs. 10 . 80
Silage lbs. 100.50
Labour hours 3 . 02
Corrective factor % 25
To illustrate the method of estimating the cost of milk production accord-
ing to a formula, let us estimate the cost, using the Misner formula. We
will assume that the cost of a good concentrate mixture is $26 a ton; of
hay $12 a ton; of silage, $4 a ton; and of farm labour 25c an hour, including
board. At these prices the total cost of 30 lbs. concentrates, 60 lbs. hay,
100 lbs. silage, and 2.5 hours man labour will be $1,575. Increasing this
total by 25 per cent to cover the other costs will give us $1.97 as the
estimated total cost of producing 100 lbs. of milk.**
Misner
Pearson Food Admin-
(N.Y.)
(111.)
istration
Indiana
Michigan
30
44
33.50
28.9
23.50
60
50
45.30
38.1
34.90
39
11.50
9.9
15.20
100
188
102.60
104.8
110.40
2.5
2.42
2.88
2.4
2.11
25
0
23.7
45.8
**The above table and accompanying explanation Is found in "Feeds and Feeding"
by F. B. Morrison, Twentieth Edition, The Morrison Publishing Company, Ithaca, New
York. 1944, pages 579 and 580.
APPENDIX 14
DAIRY COST SURVEY
Name of Operator County
P.O. Address Type of milk shipper
Acres Operated Owned or Rented Breed of Cattle Kept. . .
Estimated proportion of total farm income from dairying %
Beef cattle % Hogs % Poultry % Cash Crops %
Other %
Enumerator
Section 1 — Dairy Herd Inventory, 1946
Jan. 1,
1946
Purchased
1946
Sold
1946
Died
1946
Dec. 31.
1946
Herd buh, pure bred . . .
No.
Value
No.
Value
No.
Value
No.
Value
No.
Value
Herd bull, grade
Cows, pure bred
Cows, grade
Heifers, over 1 yr. p.b.. .
Heifers, over 1 yr. grade
Heifer calves, p.b
Heifer calves, grade ....
Calves, veal*
Calves, bull
i
* Includes calves sold at birth
[63]
64
APPENDIX 14
Section 2 — Inventory of Dairy Buildings and Equipment
Total
Value
Amount
Chargeable
to Dairy
Business
Total
Value
Amount
Chargeable
to Dairy
Busiuess
Dairy Bam & Silo
Milking Machine
Milk House
Milk Cooler ....
Litter carrier
Cans, pails, strainer, etc.
Feed carrier or cart
Cream separator
Power & Pumping
Equipment
Milk scales
Feed grinder
Milk hauling equipm't .
Root pulper
Misc. stable tools &
equipment
Oat roller
Other (specify)
Total
Total
GRAND TOTAL ..
APPENDIX 14
65
Section 3 — Home Grown Feed Summary
On Hand
Jan. 1,1946
1946
Crop
On Hand
Dec. 31, 46
Fed to Dairy
Herd. 1946
Amt. Value
1
Oats
Barley
Wheat
Mixed Grain
Com (Grain)
Com Silage
Com fodder
Soybeans
Roots
Hay (state kind)
Straw (feed or bedding). . .
Other
Note — First three columns in Section 3 need not be filled in if amount of home-
growTi feed fed to dairy herd can be determined more accurately, such as on the basis
of daily consumption or otherwise.
66
APPENDIX 14
Section 4— Purchased Feed fed to Dairy Herd, 1946
Amt.
Value
Amt.
Value
Oats
Soybean meal
Barley
Dairy Concentrate (state
kind & protein content)
Wheat
Calf meal
Mixed Grain
Beet pulp
Com
Silage
Bran
Roots
Shorts
Hay (state kind)
MiddUngs
Glutin feed
Brewer's grains
Straw
Distiller's grains
Mineral
Linseed oil meal. . . .
Salt
Cottonseed meal . . .
Other
Total
Total
1
1
GRAND TOTAL 1
1 1
APPENDIX 14
67
Section 5 — Summary of Dairy Pasture,
1946
Acres i Type of Pasture*
Period Used | Value
*Indicate whether short or long term pasture, type of mixture used, etc. If rented, specify.
Hired Labour
Section 6 — Farm Labour Summary
Months Hired
Cash Wage
per mo.
Value of Board
or Perquisites
Total Cost
of labour
Family Labour
Months Worked
Rate Paid
Total Value
Operator
Sons
Women
Other
68
APPENDIX 14
Section 7 — Summary of Dairy Herd Labour
Month
Days
Ave. time per
day hrs.
Total Dairy
Labour for
Month hrs.
Rate per
hour
Monthly Labour
Cost
January. . .
31
February. .
28
March....
31
April
30
May
31
June
30
July
31
August. . . .
31
September
30
October . . .
31
November
30
December .
31
Total, Ye
ar
Note; — First column only in Section 7 need be completed in field.
Section 8 — Farm Perquisites Used in House
Amount
Price
Milk Exiuiv.
Value
Whole Milk
Cream
Skim M.Ik
Dairy Butter
Home-made Cheese. . . .
Note: — Only columns for amount and price need be completed in field. Price
should be a farm price, not city retail price.
APPENDIX 14
69
Section 9—
Sales of Dairy Products
J.
F.
M.
A.
M.
J.
J.
A.
S.
0.
N.
D.
Total
Fluid milk lb.
Total Value
Cheese milk lb. .
Total Value. . . .
Manufactured
milk lb
Total Value
Cream lb
Total Value
Note: — If possible, total value of Diary Product Sales should be the value before
any deductions for hauling, association fees, etc. These will then be shown as expenses
n Section 11.
Section 10 — Credits to Dairy Live Stock
Amount
Value at farm
Whole milk fed to farm livestock & poultry .
Skim milk fed to farm livestock & poultry . .
Buttermilk fed to farm livestock & poultry. .
Whey fed to farm livestock & poultry
Manure
Prizes, etc
Other
70
APPENDIX 14
Section 11 — Current Dairy Expenses, 1946
Total Year
Dairv Share *^
Repairs, dairy buildings
Repairs, dairy equipment
Insurance
Taxes
Veterinary & medicine
Hauling and trucking*
Feed grinding
Electric light & telephone
Ice
Registration Fees
Breeding fees
Association fees
Milk testing expense
Spray material, whitewash, disinfectants, etc. . . .
Milk strainer discs
Advertising, stationery
Grease and Oil
Misc. hardware & supplies
Other ( specify )
*Include milk or cream hauling unless deducted from value of sales in Sect. 9.
**Experses such as taxes, irsurance. electricity, etc. which are jointly chargeahlt-
to dairy and some other enterprise should be apportioned on as reasonable a basis as
possible. One method mi^ht be on the basis of income contributed by each enterprise
APPENDIX 15
SUPPLEMENTARY BFvIEF ONTARIO WHOLE MILK PRODUCERS'
LEAGUE
The following minutes were duly moved and seconded at the annual
Meeting of the Ontario Whole Milk Producers' League, 19th and 20th
February, 1947:
WHEREAS the Provincial cabinet has seen fit to announce that the Milk
Control Board has no power to issue orders establishing fair prices to
producers and to consumers, and;
WHEREAS the Ontario Milk Producers have every confidence in the Hon.
T. L. Kennedy, who was responsible for the Milk Control Act in 1934,
and as it has so effectively regulated the fluid milk industry for the
past twelve years.
THEREFORE BE IT RESOLVED that we, the Board of Directors of the
Ontario Whole Milk Producers' League, representing approximately
16,000 dairy farmers, urge the Premier of Ontario to not only have
the Milk Control Board of Ontario sustained, but to amend the Act, if
necessary, giving the Board the power to issue orders dealing with
production, transportation, distribution, and the setting of fair prices, in
the interest of the fluid milk mdustry.
RESOLVED THAT the Ontario Whole Milk Producers' League do every-
thing in their power, within their power, to support the Concentrated
Milk Producers, Cheese Producers and Cream Producers in their cam-
paign to get cost of production and anything else in the interest of the
dairy industry.
WHEREAS it is a recognized fact that quite a large percentage of the
cost in producing milk for the fluid milk market is involved in keeping
up a level supply and in many cases catering to fluctuating markets:
AND WHEREAS we have been able through our organization to establish
the principle of cost of pioduction as a fail' price of milk for our
producer.-:
THEREFORE BE IT RESOLVED that we recommend to all our local
markets and members to sludy the need of these markets in the light
of past experience and endeavour to regulate their supply by setting
a proper quota system to meet, as near as possible, the needs of the
consumer.
We furthei- recommend that quota committees show no mercy when
setting or adjusting quotas to the producer who persistently ignores his
obligations to his market and his fellow producer.
We believe that if we hope to maintain a level price thi'oughout the
year it will be necessary for all producers to keep seasonal surpluses off
the market and make every effort to keep up their production when milk
is normally in short supply.
BE IT RESOLVED THAT the Lincoln County Milk Producers' Association
assembled in Annual Meeting wish to express our appreciation of the
untiring efforts of the Honourable T. L. Kennedy, Minister of Agri-
culture, on our behalf.
We also wish to point out the desirability for the early reinstatement
of the Ontario Milk Control Board with full authority to control the sales
and fix prices of milk from producer to consumer and to fix a reasonable
and satisfactory rate for the distributor for services rendered in dis-
tributing our products and furthermore, to control and direct the trucking
of milk and charges for this service in order that we may have orderly
marketing in the fullest extent.
BE IT RESOLVED THAT the Lincoln County Milk Producers in Annual
Meeting assembled do extend their unqualified support to the Ontario
[711
72 APPENDIX 15
Milk Producers' League in their efforts to negotiate an agreement of sale
of our milk at a fair and equitable price which assures the producer cost
of production.
WHEREAS under the Public Commercial Vehicles Act it is virtually
impossible for producers to transport their milk from their farms to
the dairies cooperatively.
THEREFORE BE IT RESOLVED that we ask the Ontario Provincial
Government to amend the Public Commercial Vehicles Act making it
possible where any group of producers decide that it is in their best
interest to transport their milk cooperatively without obtaining a P.C.V.
license.
WHEREAS the cost of transporting milk from the farm to the market
is a factor that must be taken into consideration in milk costs to the
producer;
AND WHEREAS the volume of milk carried and the mileage travelled
has an important bearing on the cost of transportation;
AND WHEREAS the milk is the property of the producer until it arrives
at the designated market and accepted by the distributor;
THEREFORE BE IT RESOLVED that the Ontario Whole Milk Producers'
League requesi; the Royal Commission now inquiring into the cost of
producing, processing, distributing, transporting and marketing of milk,
taking into consideration the savings that could be effected by local
producer associations transporting all the milk from the farm to the
plant of the distributor, the number of trucks that could be eliminated,
the saving of miles travelled and the overlapping of trucks, to recommend
amending the Milk Control Act, vesting the Milk Control Board with
authority to license all truckers of milk from the farm of the producer
to the distributing plant, and with authority to arbitrate and fix charges
for thie service.
THAT we, the Milk Section of the Dairy Farmers of Canada, affirm the
principle of cost of production as one of the main factors in determining
the price of dairy products on any market and give all assistance possible
to achieve this.
THAT we commend the Milk Foundation for the excellent work they have
already done and that we urge the expansion of their program because
we fesl that they are making a real contribution to the dairy industry
and are in a position to contribute greatly, by their interest, to our
national health.
Note: — The last two resolutions were passed by the Dairy Farmers of
Canada and are presented here for the approval of the League.
APPENDIX 16
ORDER NUMBER 39-15
TORONTO MILK TRANSPORT
Effective June 1, 1939.
ORDER NUMBER 39-15
Respecting the Transportation of Milk from the Farms of Producers to the
Plants of Distributors Located in the Toronto and District Market.
WHEREAS it is provided in the Milk Control Act that it shall be the duty
of the Board and it shall have power to inquire into any matter relating
to the transportation of milk and to adjust and settle disputes arising
between producers, distributors and transporters of milk and in each case
to make such order as it deems just, having regard to the circumstances,
and
WHEREAS the regulations made pursuant to the Milk Control Act provide
for the recognition of a Milk Transport Committee, and
WHEREAS a special committee "The Toronto Joint Committee on Milk
Transportation," have made certain recommendations to the Board
respecting the rates for transporting milk from the farms of producers
to the plants of distributors located in the Toronto and District Market
and for the settling of disputes respecting such transporting of milk and
have requested the Board to approve the recommendations and to make
an order declaring the recommendation in force, and
WHEREAS the Board having considered the recommendation and having
made due enquiries have agreed to make an order to —
(a) Recognize the Toronto Joint Committee on Milk Transportation,
(b) Define the duties and responsibilities of the said Toronto Joint
Committee on Milk Transportation, and
(c) Establish a maximum rate that may be charged for transporting of
milk from the farms of producers to the plants of distributors located
in the Toronto and District market.
IT IS HEREBY ORDERED THAT—
1. For the purpose of this order the "Toronto and District Market" shall
mean the Toronto and district area included in Section 1 of the agreement
made between the Toronto Milk Producers and the Toronto Milk Distribu-
tors, dated the 5th day of February, 1937, which agreement was approved
and ordered in effect by the Board on the 6th day of February, 1937, being
Board Order number 37-5.
2. It is ordered that a Committee which shall be known as the "Toronto
Joint Committee on Milk Transportation" is hereby established and recog-
nized by the Board in accordance with the further provisions of this order.
3. The Toronto Joint Committee on Milk Transportation shall consist of
fifteen members which shall be annually appointed in the following
manner:
(a) The Toronto Milk Producers' Association shall annually appoint
five members to the Toronto Joint Committee on Milk Transportation.
(b) The Toronto Milk Distributors' Association shall annually appoint
five members to the Toronto Joint Committee on Milk Trans-
portation, and
(c) The Toronto Milk Transport Association shall annually appoint
five members to the Toronto Joint Committee on Milk Transporta-
tion,
provided that in the event of a vacancy on the said Committee, the Associa-
tion that appointed the member that has caused the vacancy shall forthwith
appoint a member to fill such vacancy.
It shall be the duty and responsibility of the Toronto Joint Committee
on Milk Transportation to supervise the transportation of milk from the
farms of producers to the plants of distributors located in the Toronto
and District market and to forward recommendations to the Board pro-
[73]
74 _ APPENDIX 16
vided that in the event the Department of Highways have jurisdiction,
the recommendations shall be made to the said Department of Highways.
In the case of a dispute between a milk transporter and any of the other
milk transporters such dispute shall be referred to the Toronto Milk
Transport Association and if no satisfactory settlement of the dispute is
made it shall be referred to the Toronto Joint Committee on Milk Trans-
portation and if such Committee makes no satisfactory settlement of the
dispute it shall be referred to the Milk Control Board of Ontario for final
settlement.
In the event a revision of the rates for transporting milk is requested
by either the producers or the transporters, or any of them, and no satis-
factory settlement is agreed upon by such producers and transporters
the matter shall be referred to the Toronto Joint Committee on Milk
Transportation, and, in the event such Committee makes no satisfactory
settlement of the matter, it shall be referred to the Milk Control Board of
Ontario for final settlement.
No producer or transporter shall ship or transport milk to a distributor
in a can that belongs to any other distributor and no distributor shall re-
ceive milk at the plant of such distributor in a can that belongs to any
other distributor provided that in the event a distributor delivers a milk
can to a transporter that belongs to any other distributor such transporter
shall report the same to the owner of the milk can.
Every milk transporter operating under a P.C.V. license issued by the
Department of Highways shall, when transporting milk, act in the capacity
of "'common carrier" only and shall not purchase milk from any producer
for resale to any distributor.
The maximum rate that may be charged by a transporter for trans-
porting milk from the farm of a prodvicer to the plant of a distributor
located in the Toronto and District market shall be as follows:
For 15 miles and less — 15 cents per eight gallon milk can
For 20 miles and over 15 miles — 20 cents per eight gallon milk can
For 30 miles and over 20 miles — 23 cents per eight gallon milk can
For 45 miles and over 30 miles — 25 cents per eigth gallon milk can
For 65 miles and over 45 miles — 28 cents per eight gallon milk can
For 90 miles and over 65 miles — 30 cents per eight gallon milk can
For over 90 miles — at such price as the prodvicer and transporter
may agree upon.
(a) These maximum rates shall apply for the same service rendered by
the milk transporters, or any of them, previous to the effective date
of this order.
(b) In any case where rates in effect previous to the effective date of
this order are lower than the maximum rates provided above, the
previous rates shall remain in effect unless justifiable reason for an
adjustment can be shown.
(c) The mileages mentioned in this section shall be the shortest improved
road mileage from the producer's farm to the corner of King and
Yonge Streets. Toronto, as defined in the road chart filed with the
Milk Control Board by the special Committee of the Toronto Joint
Committee on Milk Transportation.
The provisions of this order shall apply to the transportation of milk
from the farms of pi'oducers to the plants of distributors located in the
Toronto and District Market.
The provisions of this order shall have effect from the first day of
June. 1939.
This order is made, signed and sealed, this ninth day of May, Nineteen
Hundred and Thirty-nine.
(sgd.) C. M. Meek, Chairman,
(sgd.) J. B. Nelson, Secretary.
Certified a true copy of Order number 39-15 of the Milk Control Board
of Ontario.
(sgd.) J. B. Nelson.
APPENDIX 16 '"^
ORDER NUMBER 39-16
TORONTO MILK TRANSPORT
Effective June 16, 1939.
Amendivg Order No. 39-15
ORDER NUMBER 39-16
Respecting the Transportation of Milk in the Toronto and District Market.
WHEREAS it is necessary to correct a typographical error made in clause
nine of Order number 39-15,
IT IS HEREBY ORDERED that the said clause nine of Order number
39-15 be amended to read:
For 15 m
les and less — 18 cents per eight gallon milk can
For 20 miles and over 15 miles — 20 cents per eight gallon milk can
For 30 miles and over 20 miles — 23 cents per eight gallon milk can
For 45 miles and over 30 miles — 25 cents per eigth gallon milk can
For 65 miles and over 45 miles — 28 cents per eight gallon milk can
For 90 miles and over 65 miles — 30 cents per eigth gallon milk~can
For over 90 miles — at such price as the producer and transporter
may agree upon.
This Order is made, signed and sealed, this Sixteenth day of June,
Nineteen hundred and Thirty-nine.
(sgd.) C. M. Meek. Chairman,
(sgd.) J. B. Nelson. Secretary.
Certified a true copy of Order Number 39-16 of the Milk Control Board
of Ontario.
(sgd.) J. B. Nelson.
APPENDIX 17
The Honourable Justice Dalton Wells,
Commissioner,
Royal Commission on Milk.
ACCOUNTANT'S REPORT
MILK TRANSPORTATION
Sir:
We have reviewed a number of financial statements of concerns engaged
in the transportation of milk and have studied the brief prepared by tho
Toronto Milk Transport Association dated January 20, 1947, in which is
included the combined operating results of twenty transportation businesses
operating in Toronto, Gait, Newmarket and other centres and which serve
the Toronto milk shed.
The statements received by us were in each case prepared by public
accountants and relate to the year 1945. That of the Toronto Milk Transport
Association covers the operations of 68 vehicles of various types and
capacities and is considered to provide a fair indication of the operations
of the industry as a whole and in particular a representative cross section
of that portion serving the Toronto area.
Operating results for 1945 for a representative group
of twenty operators
The submissions indicate that the combined earnings of the group before
provision for profits taxes, were $21,526 or 5.90% of haulage revenue for
1945 as compared with $35,103 or 14.24% for 1939. This indicates a contrac-
tion in dollar profits of 31% although the haulage revenue in 1945 was
$365,004 and in 1939 $246,655.
While revenues have advanced due to increased volume of milk loads
and a slight increase in the average haulage rate, operating costs have
also increased and below we give a tabulation showing the actual costs
of the chief elements for 1945 as compared with what they would have
been had the relationship to sales in 1939 remained unchanged. The
summary provides an accounting of the change in revenues and earnings.
Sales revenue
Cost of:
Wages . . .
1945
Actual
cost
$365,004
102,622
84.425
76,104
16,567
f7of
sales
100.00
28.12
23.13
20.85
4.54
1945
Theoretical
cost on
basis of
1939
$365,004
85,374
73,110
41,282
29,857
%of
sales
100.00
23.39
20.03
11 31
8.18
Excess
of actual
over
theoretical
817,248
Gas, oil and grease
Repairs and tires. .
Depreciation
11.315
34,822
(13,291))
Administrative and
ofifice salaries and
general expenses.
$279,718
63,760
76.64 $229,623
62.91
$50,095
17.46
83,404
22.85 (19,644)
Total cost.
$343,478
94.10 $313,027
85.76
$30,451
Net profit (before
taxes)
$21,526
5.90
$51,977
14.24
($30,451)
It will be noted that 1945 costs have benefited considerably frorn reduced
depreciation provision indicating that a number of the vehicles in service
in 1945 were fully depreciated also that a number were experiencing their
first years service in 1939 whereby the income tax regulations would
permit a 25% depreciation charge against profits for that year as compared
with 20% in subsequent years.
76
APPENDIX 17 77
Offsetting the saving in depreciation provision is the greatly increased
cost of repairs to vehicles also tire repairs and replacements. These
averaged $509 per annum for each vehicle in 1939 as against $1,119 in 1945
indicating that the vehicles were requiring more frequent servicing and
had become more costly to operate.
The apparent saving in administrative and office salaries and general
expenses is chiefly brought about by the payrolls of both administrative and
office salaries being held at almost the same level in 1945 as in 1939. In
the last mentioned year they totalled $23,188 representing 9.41% of revenue
while in 1945 the total was $24,207 equal to 6.63%. The cost strikes us as
being adequate, nevertheless the expenditure has been satisfactorily
controlled.
Under emergency wartime controls many restrictions were applied to
the automotive transport industry such as mileage and territorial limitations,
elimination of certain discounts from garages for repair parts, changes in
the terms of guarantee relating to tire purchases. Operating costs were
also advanced appreciably by increased costs of gasoline and oil and the
reduced mileage from tires manufactured under wartime standards and
specifications. To compensate for these advexse factors rate increases
were authorized where essentiality of service and financial necessity could
be proven, and this combined with the substantial increase in fluid milk
consumption, was of considerable assistance to the milk transport industry
in overcoming what may have otherwise been a critical period.
Financial position
The balance sheet position of the industry is not particularly strong,
there being many small transport businesses operating with limited financial
resources and on borrowed funds. The interest on such monies has been
allowed as a charge against profits in the results herein reported.
Under such conditions it is conceivable that difficulties may be encoun-
tered by some concerns in the acquisition of new vehicles to replace the
old which would no doubt result in savings in repair and operating costs.
Operating data
While it appears that for 1945 earnings (before taxes) average 5.90% of
revenues for the milk transportation industry individual results vary
considerably. The statements in our possession show profits ranging from
3% to 13% of revenues for some businesses, others either breaking even
or showing a loss.
Dollar revenues per vehicle also reveal sharp contrasts ranging from
$4,000 per annum to over $7,000 for an average of $5,400 per year.
The average original cost per vehicle appears to approximate $2,000 but
at the close of 1945 some concerns had depreciated the vehicles down to
an average book value of less than $300.
Taking the group of twenty concerns as a whole it was found that in
1939 the average number of eight gallon cans transported by each vehicle
was 18,804 as compared with 22,205 for 1945, an increase of 18%. In 1939
the haulage revenue per can was 23.85 cents whereas in 1945 the average
was 24.17 cents, showing an increase of only .32 of one cent per can,
according to the brief of the Toronto Milk Transport Association.
Observations and conclusions
Approximately 30% of the total fluid milk consumption of the Province
is accounted for in the Toronto milk shed. This represents approximately
129 million quarts or 332,820,000 lbs. of whole milk per annum.
In terms of eight gallon cans the foregoing approximates 4 million units
so that taking an average haulage rate of 24.17 cents per can as shown for
1945. a total annual haulage cost for the Toronto milk shed of $966,800 is
arrived at equal to .76 of one cent per quart.
As the average load per vehicle is 22,205 cans per annum it appears that
over 200 vehicles may be serving the Toronto market alone.
The financial statements we have examined show a return of 5.90% of
revenue for 1945. It is estimated that the capital employed for these
concerns as calculated substantially in accordance with the provisions of
the Dominion excess profit tax act may approximate $90,000. It should
be pointed out, however, that capital employed is not an important factor
in this business. The earnings return in relation thereto is approximately
24%.
78 APPENDIX 17
Based on the foregoing it could well be that more than 600 vehicles are
engaged in milk transportation throughout the Province and that the
capital employed may approach $800,000. On the basis of revenues approxi-
mating $3,000,000 for 1946 the return on capital employed for the whole
industry may exceed 20%.
The control of this very appreciable cost factor in the price of milk is
in the hands of the Toronto Joint Committee on Milk Transportation, a
body formed by the Milk Control Board in 1939, comprising fifteen members,
five from each of the Producers' and Distributors' Associations, and five
from the Toronto Milk Transport Association.
We presume that this body is furnished with adequate statistical data
at regular intervals to ensure satisfactory control over rates and services,
as such cost currently represents about 4''^ 2% of the consumer price per
quart of fluid milk.
There is some overlapping of territories which might be eliminated by
closer co-ordination amongst individual operators as well as between the
producers and distributors.
The industry may have annual revenues in excess of $3,000,000 and if
a determined effort is initiated by the Toronto Joint Committee there seems
a reasonable prospect that some economies helpful to the industry may be
eflfected and improved standards of service to producers and distributors
attained with resultant benefit to the consuming public.
Respectfully submitted,
JOHN S. ENTWISTLE,
Accountant. Royal Commission on Milk,
Province of Oritario.
July 26th, 1947.
APPENDIX 18
ROYAL COMMISSION ON MILK
INDEX TO ACCOUNTANTS' REPORT
SURVEY OF FLUID MILK DISTRIBUTORS
LOCATED IN THE PROVINCE OF ONTARIO
Related Related Page
exhibit table Description Number
Index to exhibits 80
A Assignment, approach and procedure 81
1 Industry background 81
Approach and procedure 82
Review and tabulation of financial statements showing
overall operating results by zones 82
Classification of businesses by sales volume 83
Review and tabulation of questionnaires and general
observations 83
B Overall operating results for the fiscal year next preceding
October 1st, 1946 84
Overall operating results 387 independent concerns by
zones 84
Overall operating results of the three large concerns 85
2 Overall operating results of 390 concerns (including the
three large companies ) 86
C Classification of indei-)endent businesses by sales volume
and by zones 87
3 Losses bv independent businesses 87
D and E 4 Analysis of oix-rating statements of representative cross-
section of industry 88
Financial ix)sition of industry 89
5-8 Wage rates and labour costs 90
Selling and delivery expenses 92
Administrative and general expenses 93
Contrasts in operating results 93
9-10 Costs and profit margins by products 93
Selling prices — fluid milk 96
Consumer prices 96
1 1 Wholesale prices 96
Prices of plant or surplus sales 98
12 Price spread — fluid milk 98
Purchases of whole milk at secondary prices 99
Consumer subsidy 101
13 Diversification of product and effect on earnings 101
Productive capacity 102
14 BreakdowTi of overall sales and net profits (before taxes) for
the fiscal year next preceding October 1st, 1946 102
Estimated overall net profits for the year 1946 103
Outlook for 1947 103
Income and excess profits taxation as applied to the industry 103
Observations and conclusions 104
Financial position and overall operating results 104
Net profits from saies of fluid milk 105
Possible increases in sales revenues 105
Possibie savings and economies 105
Records and statistics 106
Export sales 107
Amalgamations and absorptions 108
Overall operating results three large concerns 108
15 Increase in the price of fluid milk authorized in October,
1946 108
I . -* [ 79 ] .
80 APPENDIX 18
ROYAL COMMISSION ON MILK
INDEX TO EXHIBITS
FORMING PART OF ACCOUNTANTS' REPORT
SURVEY OF FLUID MILK DISTRIBUTORS
LOCATED IN THE PROVINCE OF ONTARIO
EXHIBIT
A. Index of counties comprised in each of the eight zones, or milk
sheds, showing the number and type of independent fluid milk
distributive businesses located in each, and the number and type
from whom financial statements and other data was received and
included in our survey.
B. Recapitulation by zones of data extracted from financial statements
submitted by 387 independent fluid milk distributors.
C. Tabulation by zones of sales groupings of 387 independent fluid milk
distributors.
D. Tabulation by zones showing the materials, processing, distributing,
and administrative costs of 41 representative independent fluid milk
distributors combined.
E. Tabulation by zones showing the material, labour and facilities costs
of 41 representative independent fluid milk distributors combined.
Note: The above exhibits do not include any figures relating to the three
largest concerns as they are dealt with separately in the report.
APPENDIX 18 81
The Honourable Justice Dalton Wells,
Commissioner,
Royal Commission on Milk.
Accountants' Report
Survey of fluid milk distributors
Located in the Province oj Ontario
Sir:
We have completed our survey on the above subject and now have the
pleasure to submit our report thereon.
Assignment, approach and procedure
We were required to investigate and report on the operations of fluid
milk distributors located in the Province of Ontario with particular regard
to costs, prices, price spreads, methods of financing, and methods of
management.
These matters are dealt with in the report which follows and which
includes the exhibits listed on Page 80.
Before proceeding to deal with the various points in detail, it is considered
that a brief reference to certain of the more important matters relating to
the industry as a whole would be of advantage.
Industry background:
According to the Milk Control Board there were 630 regular distributors,
and 346 producer-distributors licensed to operate in the Province of
Ontario in 1946. Of these, 416 were members of the trade organization
known as the Ontario Milk Distributors' Association.
The industry within the Province comprises three large companies, whose
combined dollar sales approximate one-third of the total, one hundred or
more independent incorporated companies, the remainder being proprietory
or partnership businesses with annual sales ranging from $5,000 per annum
to over $1,000,000. There are also a few co-operative organizations.
Based on information coming to our notice, there have been a number
of absorptions and amalgamations in recent years which may have tended
to increase the influence of the larger concerns within the industry, while
at the same time, perhaps, contributing to its overall efficiency.
The amount of capital employed is not high in relation to sales volume.
Practically all of the concerns carry fixed assets on the books at original
cost less depreciation, but certain absorptions and amalgamations have
resulted in appraised values being employed in a few instances.
Besides processing and distributing fluid milk and cream, chocolate drink,
and buttermilk, the industry produces large quantities of ice cream, butter,
cheese, and concentrated milk products. It also trades in eggs and poultry.
With the exception of one company, operations are restricted to the
domestic market, but not necessarily the Province of Ontario, as some dairy
produce is shipped into Ontario, while some, which is processed within
the provincial boundaries, is shipped to other provinces. This movement
is, no doubt, governed by price and supply factors.
The overall sales volume of the fluid milk distributive industry in
Ontario is estimated at $90,000,000 for 1946, of which approximately 65%
relates to fluid milk and cream. 8% to butter, and 7% to ice cream; the
balance comprising chocolate drink, cheese, and sundry produce. The
table, which follows, shows the allocation of the estimated whole milk
production for that year:
TABLE 1
Allocation of estimated whole milk production
in the Province of Ontario
for the year 1946
1946 1945
^_ Estimated pounds % of % of
Production of whole milk total total
Creamery Butter 68,785.800 lbs. 1,610.275,000 36.92 38.47
Factory Cheese 91 ,978.000 lbs. 1 ,030, 153,600 23 .62 26 . 94
Fluid Milk 467.736,000 qts. 1,206.758.900 27 .67 23 . 69
Fluid Cream 13.519,000 qts. 148.709,000 3.41 2.89
Condensed Whole Milk 14,765,700 lbs. 33,665,800 .77 .77
Evaporated Milk 98,063,700 lbs. 215.740,100 4.95 4.83
Powdered Whole MUk 14,535,200 lbs. 116,281,600 2.66 2.41
4,361,584,000 100.00 100.00
82 APPENDIX 18
Geogi-aphicallj', the industry is spread throughout the Province, the
smaller independents in the main serving the rural districts and the larger
ones, including the three big concerns, the urban and metropolitan centres.
The number of personnel directly in the employ of the industry in the
Province is approximately 8,000.
Approach and procedure:
The procedure adopted in the procurement of the data necessai'y for the
proper completion of the assignment was as follows:
On December 7th, 1946, a circular letter was addressed to 595 distributors
of dairy products and a number of producer-distributors located in the
Province of Ontario, requesting that they submit to the Commission a
copy of their auditor's unabridged report with certified financial state-
ments, including assets and liabilities, trading or operating, and profit and
loss statements for the fiscal year next preceding October 1st, 1946. In the
event that no regular audit was conducted, the concerns were requested
to furnish their own statements.
In additon, the distributors were requested to submit an estimate of net
profit for their current fiscal year, before provision for income and excess
profit taxes.
Although the foregoing information was requested to be lodged with the
Commission not later than December 17th, 1946, it was not until toward
the close of January, 1947, that a sufficiently satisfactory response was
recorded enabling us to proceed with an analysis of financial data and
tabulations.
Of the 595 requests, only a few unimportant businesses failed to respond.
We were, however, only able to include in our tabulations the submissions
of 390 concerns, due to a large number of the returns from the producer-
distributors and smaller enterprises being incomplete or inaccurate and,
therefore, of no value to the survey.
As regards producer-distributors we should emphasize the need for
improved accounting standards particularly in regard to the proper
division of revenues and expenses between farm and fluid milk distributing
operations. We found these to be generally merged, and this in conjunction
with insufficient data, has prevented us from submitting a separate analysis
of a representative character so far as they are concerned.
We should mention that the 390 concerns tabulated account for approxi-
mately 90'7r of the total domestic sales volume of the industry in the
Province.
Our tabulations are also comprehensive geographically, inasmuch as the
majority of the communities and counties in the Province are represented.
Furthermore, virtually all types and sizes of operation are included. It was
from this tabulation of overall operations that a selection was made lor the
purposes of submitting a form of questionnaire which was primarily design-
ed to provide us with sufficient operating and financial data to permit of
more detailed analysis. This questionnaii'e is referred to later in this report.
ReV'iew and tabulation of financial stateinents showing overall operating
results by zones:
In the recording of the submissions, code numbers were employed to
ensure privacy, as well as to facilitate handling.
The returns were first sorted into geographical zones covering the whole
Province, and record made of the location of the business, its fiscal year
end, the amount of annual sales, overall net profits (before provision for
income and excess profits taxes), the net book value of fixed assets, and
the amounts comprised in loan capital, investments, capital and surplus. In
addition, the estimated amount of net profit for the curi-ent fiscal year was
also recorded.
With regard to the net profits of proprietory businesses, as distinct from
incorporated companies, it was found necessary to make many adjustments
in respect of proprietors' or partners' salaries in order to ensure proper
comparison and a more accurate assessment of each enterprise. In many
instances we found that no provision had been made for remuneration to
proprietors. In other instances the charge was entirely out of proportion
to the size of operation. A scale of remuneration to proprietors and partners
was accordingly prepared and applied throughout our calculations, thus
placing proprietory businesses on a uniform basis so far as this item of
APPENDIX 18 83
expense is concerned and permitting a comparison with incorporated
companies of similar size.
The Province was first divided into three geographical divisions; namely,
western, central, and eastern. (Northern Ontario is included in the central
geographical division.) Then the western and central areas were each
sub-divided into three sections and the eastern into two, making eight
zones, substantially in accord with the "milk-sheds" adopted for price
control purposes.
Exhibit "A" attached, shows the counties or districts comprised in each
zone and the number of distributors and producer-distributors located in
each zone, county or district of the Province, divided as between proprie-
tory concerns and incorporated companies. In the last three columns is
shown the number of each type of concern from whom financial statements
were received, reviewed, and incorporated in our tabulation. The figures
do not include the branch establishments of the three large distributive
concerns.
It will be noted that a substantial proportion of the limited liability
companies responded with sufficiently complete returns to permit their
inclusion in our tabulations; the standard of the returns from the smaller
proprietory businesses, however, was such that many of them were
unacceptable.
Classification of businesses hy sales volume:
As regards the three major distributive concerns, each of them conduct
operations in one or more provinces of the Dominion in addition to Ontario,
the largest also engaging in export business on a substantial scale. Two of
the three companies conduct branch operations throughout the Province,
the third confining its activities largely to the Ottawa and Toronto areas.
The great majority of the independent distributors, however, have one
place of business and serve the community in its immediate vicinity.
The variation in the individual sales volume of these independent con-
cerns is considerable, and having regard to the influence of volume on net
profits, it was decided to tabulate the returns by sales ranges. Six classifi-
cations, or groupings, were made, ranging from businesses with a sales
volume of less than $20,000 per annum, to those with annual sales in excess
of $500,000 per annum.
Review and Tabulation of Questionnaires:
Of the 387 independent concerns whose financial statements weie tabu-
lated, it was decided to request a fair proportion of them to complete a
form of questionnaire. In making this selection consideration was given to
the standard of financial statement submitted, geographical location, charac-
ter and size of operation, type of business, as well as other factors, so as
to ensure a fully representative cross-section of the industry from all
viewpoints.
The questionnaire itself included two exhibits, relating to the financial
position and operating results, and ten schedules designed to provide
operating and statistical data regarding sales and selling prices, costs of
raw materials and ingredients, cost of processing, selling and delivery
expenses, administrative and general expenses, as well as wage rate
and labour data. Instructions regarding completion were appended so as
to avoid misinterpretation as far as possible and ensure uniformity of
answer. In designing the questionnaire, consideration was given to our
minimum requirements, also the facility with which it might be completed
by the majority of distributors selected.
General:
We believe that the foregoing broadly covers our approach to the prob-
lem and the procedures followed, but reference should be made to the
difficulties experienced in obtaining the required information, necessitating
in a number of cases personal visitation and discussions either with the
distributing concerns or their auditors.
As regards the submission of financial statements, it became necessary to
send many follow-up letters due to dilatoriness on the part of many
concerns and in a number of instances, to lack of the most elementary
financial data, in which case, copies of income tax returns were requested.
84 APPENDIX 18
Before the statements were passed for tabulation, each one required
to be scrutinized for any extraordinary features requiring explanation,
such as, disparities between actual operating results and forecasts, wide
fluctuations in earnings from year to year; reasons and particulars of
consideration involved in change of ownership, to mention but a few of the
numerous points entailing correspondence.
As regards the questionnaires, even though the utmost care was taken in
making our selection, substitutions became necessary due to change in
ownership, lack of sufficiently detailed records or years of operation, all
of which involved communications through one medium or another.
Finnally, as with the financial statements, each questionnaire was carefully
reviewed for any omissions, irregularities, variations with financial state-
ments already lodged, and many other points.
In all, over five hundred special letters were sent to fiuid milk distribu-
tors alone and considerably more were received requiring individual
attention, in addition to telegrams and telephone calls, which were quite
numerous in themselves.
The selection of concerns for questionnaire purposes could not be pro-
ceeded with until the tabulations of the financial statements were com-
pleted. Although the questionnaires should have been returned by Febru-
ary 12th, 1947, it was not until March that sufficient information had been
received to enable us to conduct our analysis on any worth while scale.
In fairness to the operators, however, we are bound to say that the
time of the enquiry was very inconvenient inasmuch as the first request
reached the distributors when, in many cases, they were preoccupied with
the closing of their accounts for the fiscal year, while the questionnaire
was received when taxation returns were required to be prepared and
filed. Christmas and other holidays also intervened.
Overall operating results
for the fiscal year next preceding
October 1st, 1946
Overall operating results
387 independent concerns, by zones:
Exhibit B attached, summarizes the overall net profits, before provision
for Dominion income and excess profits taxes, sales and certain other data
extracted by us from the financial returns submitted by the 387 independent
distributors. This exhibit does not include the corresponding figures of
the three large concerns, as in their case a breakdown by zones or milk-
sheds is not practical. We have, however, included the combined figures
of the three concerns in table 2 which follows later in this report.
Commenting on exhibit B we should point out that the sales and net
profits shown are the overall figures and include revenues from ice cream,
butter, chocolate drink, and other products in addition to fluid milk and
cream. As few concerns maintain departmentalized accounts, there was
no alternative. Cost and profit margins by product are dealt with later
in this report.
Of the 387 financial statements tabulated, 242 were certified by public
accountants or other independent persons.
In considering the overall average net profit (before taxes) of 3.02% of
sales, we should point out that there are included in our tabulations a few
concerns showing operating losses. The great majority, however, show net
profits ranging from less than 1% of sales to more than 5%, in a few
instances the latter rate being comparable to that of the three largest
concerns.
As regards the percentages of net profits between zones as well as in
total, we should mention that they closely approximate the results shown
by the questionnaires, with the exception of zone 4 which includes the
Toronto area. In this connection the questionnaires indicate that the
overall net profits, before taxes, for the Toronto area represents 1.77%
of sales and not 1.37% as shown in exhibit B. The former percentage
being based on a representative cross-section of the area is, of course, rnore
accurate than the latter which simply reflects the result of a straight
tabulation of financial statements received and recorded.
Apart from this, exhibit B provides a reliable comparison of the rates
of overall earnings between the different zones. The St. Lawrence sector,
the northern districts, and the Niagara peninsular sector showing the
APPENDIX 18
85
highest margins and York County and the Ottawa Valley area showing
the lowest. It will be noted that the percentages of net profit to capital
employed show much the same comparison.
In terms of dollar contribution to overall profits for the entire industry,
the position is of course totally different. Toronto, Hamilton, and Windsor
areas, with their much greater sales volumes, contribute more dollars to
the total overall profits of the industry than other areas enjoying higher
rates of earnings.
Other tabulations made by us indicate that the independent distributors
of the Province hold investments in Dominion of Canada bonds and other
securities in excess of $1,500,000; that the bonded indebtedness, mortgages,
and other long term borrowings exceed $2,500,000 and that the depreciated
value of fixed assets approximates $8,500,000.
Before concluding our observations on exhibit B, we should mention
that, had it been possible for us to include the corresponding figures of the
three large concerns, the rates of earnings in relation to sales in probably all
the zones would have been higher.
Overall operating results
of the three large concerns:
After eliminating the export sales and related profits of the one company
engaging in foreign trade on any substantial scale, the combined position
may be summarized as follows:
Sales $35,472,455
Overall net profits (before taxes) 1,593,263
Net profit % of sales 4.49%
The above relates to the sales and net profits realized from production of
fluid milk and all other dairy products processed within the Province of
Ontario by the three concerns.
The net profit figure of $1,593,263 is after deducting bond interest,
provision for employees pension fund, as well as certain other charges and
write offs. Some of these charges are substantial in amount and may or
may not be allowed as deductions by the income tax authorities. However,
in accordance with the principle followed by us throughout the survey we
have accepted the figures as submitted.
As regards net profits the combined percentage of sales of 4.49% is almost
50% higher than the overall average of all independents shown at 3.02% of
sales. Individually the earnings range from 3.46% of sales to 5.66%.
There are, however, a number of the more successful independent opera-
tors whose rates of earnings in relation to sales, exceed those of the three
large concerns. They are amongst those establishments engaged in
combined operations.
In general we believe that the favourable overall earnings rate of the
three major companies may be attributed to diversification of product in
conjunction with a relatively high standard of operating efficiency. They
maintain branch establishments throughout the Province, in the larger
centres, where volume business is assured, and engage in wholesale trade
on an appreciable scale.
Each of the three companies conduct large and successful operations
outside the Province of Ontario. The profits arising therefrom have been
excluded by us, as this report is confined to operations within the Province.
The financial position of the group is inherently strong. Substantial
reserves are reflected in the respective balance sheets. Fixed assets have
been very considerably depreciated or otherwise written down. Our impres-
sion is that the balance sheet valuations are in each case conservatively
stated.
With regard to the return of earnings on capital employed, each of the
three companies presented a different problem, for just as profits relating
to operations in the Province of Ontario only were required to be deter-
mined, so capital employed in the Province was similarly required to be
ascertained.
In dealing with the 387 independents, our determination of capital
employed was substantially in accordance with the provisions of the
o6 APPEIJDIX 18
Dominion excess profits tax act. It was, therefore, considered that the same
principle should be applied in dealing with the three largest concerns, so
that a comparable basis would result.
However, as we have already mentioned, each of the three concerns has
acquired other businesses in past years on different bases, either by
exchange of shares, outright purchase of shares, purchase of assets or by
some other method.
These transactions have necessarily complicated the balance sheet posi-
tions, so that each of the three companies consider that the amount of
capital employed as determined under the provisions of the Dominion
excess profits tax act does not fully reflect the actual amount of capital
employed in the business.
Having regard to the foregoing, it was thought advisable to obtain more
information from each of the three companies, and in particular, separate
figures showing, firstly, the amount of capital employed as computed
under the provisions of the Dominion excess profits tax act and the
proportion thereof applicable to Ontario operations and secondly, an
alternative amount which, in the opinion of the officers of the companies,
more accurately represented the actual amount of capital employed in the
Province of Ontario.
Below we give the amounts reported to us by the companies in respect
of each:
Three large companies comhined
Capital employed in the Province oj Ontario
relating to the fiscal year next preceding October 1st. 1946
^cOf
Capital Net profit capital
employed before taxes employed
(a) .•\mount submitted by the companies as
representing the actual amount of capital
employed 826.190.355 $1,593,263 6.08
(b ) .Amount as computed under the provisions
of the Dominion e-xcess profits tax act .. . 9,250,546 1,593,263 17.22
Difference §16.939.809
With respect to item (a) it should be pointed out that a total sum of
$20,300,560, representing goodwill is included therein, whereas item (b)
mcludes but $3,360,751 for goodwill of which only $389,585 is incorporated
in the financial statements.
The amount of $20,300,560 is substantially comprised of the excess of the
market value of the shares, (as stated by the three companies) issued to
the vendors of the various businesses, over the nominal or par value of
such shares.
Inasmuch as it constituted additional consideration to the vendors, over
and above the amounts paid them for net tangible assets, it affords a good
indication of the value placed by the three large companies on the acquisi-
tion of the various businesses as going concerns.
It should also be pointed out that item (a), i.e., amount submitted by the
companies as representing the actual amount of capital employed of
$26,190,355, does not include the sum of $3,795,228 which one of the com-
panies reports "represents the write off to capital of certain idle equip-
ment and a write down during the depression in the early 1930's of excessive
values of certain operating equipment to bring the book value in line with
what was then considered the current market values."
Overall operating residts of 390 coricerns (including the three large com-
panies) :
In table 2 following is given the combined figures of the 390 concerns in-
cluded in our tabulations:
APPENDIX 18
87
TABLE 2
Summary of overall operating restdts of 390 dairy distributing businesses
located in the Province of Ontario for the fiscal year next preceding
October 1st, 1946.
(Export sales and profits thereon are not included)
Net profits
Sales (before taxes) Capital employed
'cof
Amount Sales Amount Profit ' ,
Western $31,256,686 .Sl,195.315 3.82 §6,987,396 17. 11
Central and northern... 37,177.477 1.244.439 3 35 7.338,370 16.96
Eastern 12,848,691 537,696 4.18 2,802.255 19.19
$81,282,854 $2,977,450 3.66 $17,128,021 17.38
For the purposes of the above table capital employed has been calculated
substantially in accordance with the provisions of the Dominion excess
profits tax act for all concerns including the three large companies. In
their case the total amount has been apportioned over the three geographi-
cal divisions on the basis of sales.
Classification of indepe^ident businesses by sales vohime and by zones:
We give below a summary of the number of concerns in each of the
six sales groups as shown on exhibit C:
Group No. Number of concerns
1 65
2 118
3 79
262
4
69
5
39
6
17
Total 387
The above discloses that, of the 387 independent concerns tabulated, 262
are relatively small enterprises having an annual sales volume not exceed-
ing $100,000. The average annual sales volume for this group is $40,313.
The combined sales total is $10,561,938, representing 23.06% of all sales
recorded in the exhibit, whereas the profit contribution of $275,430 to the
total earnings of $1,384,187 represents 19.90% showing that, proportionately,
the profit contribution of the smaller enterprises is less than their con-
tribution to total sales.
Losses hy independent businesses:
Out of 387 independent concerns included in our survey, 45 opex-ated at
a loss during the fiscal year next preceding October 1st, 1946. The losses
ranged from $14 to $10,578 and aggregated $61,379, which amount has been
allowed for in arriving at the overall profit figure of $1,384,187 per
exhibit B.
Out of the 45 concerns only 14 have indicated that they anticipated
another year of loss on about the same scale. The majority expected
substantial improvement and a fair profit margin.
To this extent these particular 45 concerns cannot be considered as
providing any index to the earnings potential of the industry, neverthe-
less, it has been thought advisable to include them in our tabulations so
that the fullest representation is accorded in this report.
Of the concerns incurring losses two are located in each of the cities
of Hamilton, Brantford, and St. Catharines. Nine are located in Toronto,
and their losses combined aggregate $27,761, or 45.23% of total. Below in
table 3 is given a breakdown by zones:
S8 APPENDIX 18
TABLE 3
Summary of independent concerns showing losses
for the fiscal year next preceding October 1st, 1946
No. of
Zone Concerns Total
1 -
. 2 8 $11,260
3 5 3,470
4 13 31,257
5 8 5,640
6 5 4,300
7 3 1,325
8 3 4,127
Total 45 $61,379
Twenty-nine of the concerns are in the three groups having annual
sales volume of less than $100,000.
The total sales of the 45 concerns for the twelve month period was
$4,370,330 or 8% of the total of all independents. The loss of $61,379
represents slightly more than 1% of sales.
Analysis of operating statements
of representative cross-section of industry:
From amongst the questionnaires returned to us, an analysis of operating
costs was made of 41 concerns located in thirty different counties throughout
the Province, each of the eight zones being represented. The group
comprised proprietory businesses and partnerships as well as incorporated
companies, and each of the six sales groupings are included. Accordingly.
it is submitted that the concerns combined present a fairly representative
cross-section of the industry excluding the three largest concerns.
Of the 41 concerns, five incurred losses, the remainder showing net profits,
before taxes, ranging from less than 1% to more than 6% of sales.
Exhibit D, attached, provides a breakdown of operating costs under the
four standard headings, while exhibit E gives a breakdown by elements of
cost, i.e., materials, labour, and cost of facilities.
It will be noted that the combined overall net p'rofits of these 41 concerns
was 3.07% of sales as compared with 3.02% shown in the tabulation of 387
independents per exhibit B. A comparison Tay zones reveals the following:
TABLE 4
Comparison of net profit margins by zones
Exhibit B Zone Exhibit D
/c - /c
3.64 1 3.34
2.54 2 2.63
4.08 3 4.49
1.37 4 1.77
4.16 5 4.16
4.19 6 4.58
3.02 Overall
The three main divisions of the Province compare as fouows:
3.41 Western 3.51
2 . 66 Central and Northern 2 . 87
3.17 Eastern 3.01
3.02 Overall 3.07
APPENDIX 18 89
Having regard to the similarity of the figures which were arrived at
separately by two entirely different methods, we consider that the foregoing
tabulation and related exhibits indicate, with reasonable accuracy, the
overall profit margins of independent fluid milk distributors by zones
as well as for the Province as a whole.
Commenting on the cost breakdown given in exhibit D, it would appear
that the explanation for the low rates of earnings in both zones 4 and 7
is due to relatively high material costs and excessive selling and delivery
expenses. The low material costs in zones 3 and 8 would seem to account
for the more favourable profit margins in those areas, while as regards zones
5 and 6, economic selling and delivery expenses appear to be largely
responsible for the satisfactoi^y rates of earnings.
Processing costs in both the Toronto and Windsor areas compare
favourably with the other areas, but zone 7 shows an especially low cost.
As regards exhibit E we would direct your attention to the repair costs
and provision for depreciation. Collectively they account for almost 4% of
total sales revenue and approximate 13% of the total depreciated book value
of buildings, machinery and equipment for the group.
Selling and delivery wages are a most important element of cost
and there appears to be considerable variation in this item between the
different zones.
Financial position of industry
A review of the comparative balance sheets for the two years ended in
1939 and 1945/6 forming part of the questionnaire, clearly indicated that
the financial position of fluid milk distributors has improved appreciably
since 1939. In evidence of this statement we give below certain data
relating to a representative group of independent operators. The position
of the three large concerns has already been referred to.
Each of the concerns showed an improved financial position, although
there exists considerable variance in their individual achievements over
the period of six or seven years.
Net profits for the concerns aggregated $874,573. During the period of
six years a net total of $370,755 was added to the reserves for depreciation
giving a total to be accounted for of $1,245,328. This amount was applied
as follows:
Expended on:
Additions to fixed assets (land, buildings, machin-
ery and equipment) $ 706,259
Additions to current assets (principally Domin-
ion of Canada Bonds) 467,447
$1,173,706
Income and excess profits taxes $ 311,787
Drawings, dividends, and surplus adjustments .... 264,377 576,164
$1,749,870
Deduct:
Increase in current liabilities $ 296,411
Increase in capital and funded debt 208,131 504.542
$1,245,328
The total withdrawals for dividends, drawings, taxes, etc., of $576,164
represents 65.88% of total earnings of $874,573. Inasmuch as current lia-
bilities have increased by $296,411 and current assets by $467,447, the work-
ing capital position has improved by $171,036. In this regard it should be
rnentioned that due to the elimination of charge accounts and the introduc-
tion of the ticket system the working capital requirements are less today
than in 1939, despite the increased sales volume which, together with better
profits, explains why the industry has been able to make such substantial
investments in Dominion of Canada bonds and other securities during
recent years.
The capital and surplus accounts for the concerns combined, totalled
$532,683 at the close of 1939. From that time to the close of 1945/6 net
90 APPENDIX 18
profits (before taxes) aggregated $874,573. Thus, the earnings over the
period, before taxes, represents 164.187c of the total capital and surplus as
at the commencement of the period, i.e., 1939 and, after taxes, 105.65%.
The net additions to reserves for depreciation after adjusting retirements
and write-offs for the years 1940 to 1945/6 total $370,755. Over and above
this are the charges in respect of repairs and maintenance, which approxi-
mate 2% of sales for a total of about $420,000. Thus, we find that deprecia-
tion charges, repair costs, and other adjustments combined, for the period
1940 to 1945/6 inclusive, approximate $900,000.
In relation to this it should be mentioned that the net depreciated value
of land, buildings, machinery, and equipment at December 31st, 1939, for
the combined concerns totalled $551,922. Since that date the sum of
$706,259 has been expended on fixed assets.
In reviewing the questionnaires, it was found that only two concerns
out of the group were carrying fixed assets at appraised values.
Before leaving the matter of fixed assets, it should be mentioned that
the output of the group has more than doubled since 1939 and, therefore,
increased cost of wear and tear might be expected, although the equip-
ment has, in the main, only been subject to single shift operation. On
comparing 1939 figures with those of 1945/6 we find the following:
% of
1939 1945/6 Increase Increase
Provision for depreciation $55,214 $ 94,997 $39,783 72.05
Repairs and maintenance 44,836 104,920 60,084 134.00
$100,050 $199,917 $99,867 99.82
While there may be a certain amount of automotive equipment used in
delivery service which has passed the stage where it can be operated
economically, it would seem that ample provision has been made for its
maintenance and retirement as new replacement vehicles become available.
As regards plant and processing equipment it would seem reasonable
to assume that it has been maintained in a thorough manner and replace-
ments, improvements, and additions made as and when deemed appropriate
by the respective managements. As the result of the improvement in
the liquid position during recent years future purchases of equipment can
be made on a substantial scale without dislocation of finances.
Wage Rates and Labour Costs
From amongst the questionnaires submitted by the independent dis-
tributors throughout the Province, a number were selected for detailed
analysis. The group comprised incorporated companies and proprietory
businesses. All of the eight zones were represented, and the concerns
have annual sales volumes ranging from $35,000 per annum to more than
$1,500,000. To this extent the group may be considered as providing a
representative cross-section of the independent distributors of the Province.
Our tabulations for the group covered the processing and distribution
of 14,534,547 quarts of fluid milk, cream, chocolate drink, and buttermilk
in 1939 and 29,967.573 quarts in 1945/6. This indicates an increase in sales
volume of 106.18% since 1939 which is much the same as the increased
consumption of such fluid products for the entire Province.
Such increased production necessitated additional help and the personnel
of the processing, distributing and administrative departments were supple-
mented as follows:
TABLE 5
Number of Employees
%cOf
1939 total 1945/6
Processing 87 27.02 149
Selling and delivery 191 59.32 291
Administrative 44 13.66 66
322 100.00 506 100.00 184 57.14
% of
%of
total
Increase
increase
29.45
62
71.26
57.51
100
52.36
13.04
22
50.00
APPENDIX 18 91
The foregoing indicates that an increase in quantitative sales volume of
106% necessitated an increase of only 57.14% in personnel.
In addition to increased personnel such expansion necessarily entailed
extensions and improvements to existing plant and equipment. In the
main, the required funds were obtained from the respective treasuries
without the necessity of borrowing or raising additional capital.
As with virtually every industry, wage rates increased substantially
during the war years, and this, combined with the additional personnel,
entailed greatly increased payroll disbursements. Our tabulations show
the following comparison for the group as a whole, which as we have
stated, provides a fairly representative cross-section of the Province.
TABLE 6
Total Payroll Disbursements
% of % of
1939 Total 1945/6 Total Increase
Processing $108,804 23.47 $251,598 25.59 $142,794
Selling and delivery 280,669 60.54 596.016 60.61 315,347
Administrative and general 74,154 15.99 135.741 13.80 61,587
Total $463,627 100.00 $983,355 100.00 $519,728
Comparison with table 5 shows that whereas the number of personnel
engaged in selling and delivery in 1945/6 was 52.36% greater than in 1939,
payroll requirements were considerably higher, indicating that there must
be a substantial element of wage rate increases. In this regard, we submit
the following:
TABLE 7
Comparison of Average Weekly Wage Rates
% of
1939 1945/6 Increase Increase
Processing $24.05 $32.47 $ 8.42 35.01
Selling and delivery 28.19 39.39 11.20 39.73
Administrative and general .... 31.63 39.03 7.40 23.40
Combined $27.54 $37.31 $ 9.77 35.48
It will be noted that the weekly wage rates of the selling and delivery
division have advanced the most, and as 57.51% of the total personnel are
engaged in this phase of the business, it constitutes the major part of the
burden. It is. in fact, a most important element of cost so far as the
distributive industry is concerned, as selling and delivery wages and com-
missions represent approximately 65% of total selling and delivery expenses.
To what extent female labour may have been employed to offset in-
creased male rates is not known, but we believe table 7 above affords a
reasonably accurate indication of the increased wage rates of the inde-
pendent distributors from 1939 to the early part of 1946.
Turning to the effect of the foregoing on the costs of production and
distribution, it was found that the greatly increased output combined with
improved standards of efficiency, also wartime economy measures, enabled
the group of concerns under review to absorb the greater part of the
increased wage disbursements. It appears that the benefits resulting from
these factors virtually offset the entire amount of the increased wages.
By dividing the total number of quarts of fluid milk, cream, chocolate
drink, and buttermilk sold by the group in 1939. totalling 14,534,547 quarts
into the total payroll disbursements, we find that the total labour content
in 1939 was 3.1899 cents per quart, whereas in 1945/6. largely as a result of
the increased sales volume, the labour content had advanced to only 3.2815
cents per quart as follows:
92 APPENDIX 18
TABLE 8
Labour Cost Per Quart
1939 1945/6
Cents Cents
Processing 7487 .8396
Selling and delivery 1.9310 1.9889
Administrative and general 5102 .4530
Increase
%of
Cents
Increase
.0909
12.14
.0579
2.80
(.0572;
(11.21)
3.1899 3.2815 .0916 2.87
It will be noted that the saving in administrative and general office
salaries and bonuses calculated on a unit basis, practically offset the
increase in selling and delivery wages, due to the number of personnel in
the administrative and office section of the total payroll, advancing only
50% numerically and only 29.90% as regards average weekly wages as
against a quantitative volume increase of 106%.
In support of the foregoing we should say that, although the information
which we have on man hours is limited, we have, nevertheless, made cer-
tain calculations regarding 1939 and 1945 which indicate a saving in the
latter year of approximately 24% in elapsed time in the processing and
distribution of fluid milk.
In considering the foregoing matter of labour costs it should not be
overlooked that the standard of industrial relations within the industry
has improved considerably since 1939, according to the questionnaires.
Working hours have been reduced and many concerns grant statutory
holidays and a minimum of one week's vacation with pay plus time and
one-half for overtime. It was noted that a number of the larger companies
have agreements w^th recognized trades union organizations.
Only very few of the distributors appear to provide for pensions to
employees either on a contributory or non-contributory basis.
The foregoing serves to demonstrate the ability of the industry to absorb
increased wage rates within certain limits when a progressively improving
market for its products prevails.
Selling and Delivery Expenses
Taking the same representative group of concerns, it was found that in
1939 the combined selling and delivery expenses were $433,459 of which
$280,669, or 64.75%, was represented in wages and commissions. As the
result of increased sales, requiring additional personnel, also advances in
wage rates, as well as other expenses, the total in 1945/6 was $868,998, or
100.48% greater, of which wages and commissions aggregated $596,016, or
68.59%. Other expenses, including advertising, depreciation, repairs, gas,
oil, feed, insurance, etc., had, therefore, risen from $152,790 in 1939 to
$272,982 in 1945/6 an increase of 79%.
To provide adequate delivery service, 101 additional vehicles were
employed making a total of 260 in 1945 as against 159 in 1939. Of the new
vehicles acquired, 53 were horse-drawn and 48 automotive. This additional
equipment in itself was insufficient to take care of the increased volume,
but means were found whereby the vehicles carried about 25% more quarts
of fluid product in 1945/6 than in 1939.
Overall it seems that the ratio of horse-drawn vehicles to total was about
fhe same in 1945 as in 1939. Local conditions, routes, and deliveries, no
ioubt, have some bearing on the matter, but whether the relative operating
jost of horse-drawn vehicles as opposed to automotive is fully considered,
we are unable to say. From such figures as are available, it appears that
in urban centres at least the horse-drawn vehicles are more economical
from the viewpoint of capital outlay, as well as operation cost, but, of
course, individual cases require to be separately considered.
As with most other purchases, the larger concerns probably enjoy better
terms 'in both the original purchase and the subsequent repair cost of
delivery equipment, than the smaller enterprises. When it is considered
that the initial outlay for delivery equipment of the group in question
approximated $350,000. it is an important item.
Advertising expense for the group increased from $16,239 in 1939 to
$26,140 in 1945/6 or 61%, although in relation to sales it bears a lesser
percentage in 1945/6 than in 1939 when it equalled less than one percent.
APPENDIX 18
93
Although it is not an important item from an expense viewpoint, the
necessity of it might be questioned as such expenditures are frequently
lost sight of. ■■ •, V u J 1
Most of the group are operatmg on a seven day delivery schedule.
Tests made of the quantities of fluid milk sold per route indicate that
deliveries have increased approximately 35% per route since 1939.
As a further test of the relative economy in operation between 1939 and
1945/6 it has been estimated that the quantity of milk delivered in 1945/6
per employee is 30% higher than in 1939.
The m.atter of routes, deliveries, and related costs is a potent factor in
the operations of the distributive industry and should, we believe, be the
subject of further study, as the response to our questionnaire suggests a
lack of basic information on the part of many distributors on this most
important matter.
The cost of delivery and selling expense per quart of milk is influenced
considerably by the proportion of wholesale volume to total, but due to
lack of information we have not been able to determine the extent.
Administrative and General Expenses
For the same group of concerns this overhead item might be broken down
as follows:
1939 1945/6 Increase
Salaries $ 74.154 $135,741 $ 61,587
Sundries 54,271 97,185 42,914
$128,425 $232,928 $104,501
The salaries item has already been dealt with under the heading of
"Wage rates and labour costs". Despite the appreciable dollar increase,
this item represents only 3.01% of sales for 1945/6 as against 3.31% in 1939.
The sundries item comprises depreciation on office equipment, telephone,
stationery, postage, and similar items of expense.
Considering the amount of increase, and having regard to the business
developments of recent years, requiring more clerical helo than previously,
as well as the low ratio to total sales, the expenditure does not seem
unreasonable.
Contrasts in operating results
Our survey brought to light many contrasting results between reasonably
comparable concerns operating in the same area, which on analysis were
in most instances found to be attributable to one or more of the following
factors:
(a) variations in average unit selling prices due to different proportions
of wholesale or retail trade to total sales;
(b) variations in the sales volume of the different products;
(c) differences in the average cost of whole milk and other materials
and supplies;
(d) variations in the operating costs of vehicles, excluding wages;
(e) wide disparities in the dollar sales per vehicle and per employee;
(f) variations in efficiency of manpower;
(g) differences in repair and maintenance costs.
In regard to variations in efficiency of manpower (item f) we would cite
a comparison between two concerns in the same city where the wage
rates of one were found to be 20% higher than the other, the hours 6%
less, yet a lower labour cost per unit was indicated. The same company
showed substantially more dollar sales per employee and per vehicle than
ths other, all contributing to a much higher rate of earnings. This particular
comoarison provided an informative analysis of the various factors con-
tributing to successful operation and attractive profit margins, as opposed
to the less profitable.
Items (d) and (e) are, of course, influenced by the volume of wholesale
sales in relation to retail sales.
Costs and Profit Margins by prodiicts
As we have mentioned, it would appear that relatively few concerns
maintain records showing the cost of the various products dealt in, while
those that do, provide contrasting figures which were difficult to reconcile
in many cases.
94 APPENDIX 18
Even amongsl the three large concerns the total costs reported to us
show wide disparities. For instance, as regards fluid milk, total costs in
1945 were reported ai 12.61 cents by one concern, 11.75 cents by another,
and 11. S8 cents per quart by the third. Butter costs were reported by one
company at 32.08 cents per pjund and by another at 37.85 cents, yet both
companies showed lo-scs on the product.
A representative group of independents showed the cost of fluid milk
at 11.93 cents per quart and cream at 42.85, as against 39.04 per quart for
one of the three large concerns. Ice cream for the group of independents
was costed at $1.09 per gallon and by one of the three large companies at
95.85 cents. Chocolate drink seemed to be fairly uniform at 12.41 cents
per quart.
The quality of the product has considerable influence on the cost but
what is perhaps the most important factor is the apportionment of over-
head and indirect expenses between the difl'erent products. In this regard
the introduction of some standard accounting practice is essential if
reasonably accurate unit costs and profit margins are to be determined
and proper comparisons made possible as they should be. From the cost
data submitted it was found that some concerns were apportioning indirect
charges on the basis of dollar sales of each product, others on the material
cost, while in one instance product costs were arrived at by deduction,
on the assumption that all products carried the same profit margin,
demonstrating a lack of appreciation of accounting principles.
With the substantial volume involved on all the products mentioned,
a discrepancy of a fraction of a cent in the unit cost totals a considerable
amount over the neriod of a year and may make the difference between
a profit or a loss being indicated on the particular product.
The determination of profit margins by products is not only dependent
on accurate costs but also on the proper breakdown of selling prices by
the diflferent types of sales outlets and here again we find that relatively
few concerns maintain adeauate records. It appears that the majority do
not record the units sold and the sales value of each product according
to sales outlet.
Many distributors engage in wholesale trade as well as retail and in
the case of fluid mi^k the wholesale selling prices carry an average
discount of about 12 Mi Of off retail equal to 2 cents per quart at present
orice levels according to the ouestionnaire submitted. Part of this discount
is no doubt offset by savings in delivery and selling expenses on whole-
.■^ale deliveries as compared with retail but the extent we have been unable
to determine due to lack of sufficient data.
Where the wholesale volume is substantial the effect on the overall
average selling price per ouart is considerable and if the figures are
accepted without enauirv. the impression mav be left that the margin of
profit on all fluid milk is extremelv narrow, whereas through analysis,
it might be determined that, in some instances at least, an actual loss is
being incurred on wholesale sales and a fair, or perhaps appreciable,
margin of profit on retail. Under such circumstances, the consumer would
be virtually subsidizing the wholesaler.
The matter of wholesale prices is dealt with later in this report, but
in considering profit margins by products the subject has an important
bearing.
Based on the information available to us and such analysis as we have
made of financial statements and Questionnaires, we believe that the
figures given in tables 9 and 10 which follow, mav be used as a basis of
comparison or as a standard '^f mp^surement for the distributors of dairy
products in the Province of Ontario.
The figures themselves relate to the fiscal year immediatelv preceding
October 1st. 1946. but based on examination of financial statements and
questionnaires relating to the year ended December 31st, 1946, we also
believe thev are indicative of the costs and profit margins by products
for that year.
The selling prices shown represent the overall average for retail, whole-
sale, and surplus sales combined:
.APPENDIX 18 95
TABLE 9
Selling prices, costs, and profit margins by product for the fiscal year
next preceding October 1st. 1946
Selling
Price Cost Profit '/^ Profit
Unit (Cents) (Cents) (Cents) of Sales
Fluid Milk quarts 12.31 12.10 .21 1.71
Fluid Cream quarts 44.00 41.36 2.64 6.00
Chocolate Drink quarts 13.79 12.41 1.38 10.00
Ice Cream gals. 117.00 99.45 17.55 15.00
Butter pounds 38.00 38.76 (.76) (2.0U)
Cheese pounds 20.00 19.25 .75 3.50
Were all sales made at the maximum retail prices profit margins would
of course be improved.
For the year 1945 the average retail selling value, including consumer
subsidy of 2 cents per quart of fluid milk was slightly less than 13 cents
per quart. For 1946 the average retail or household price was 13.46 cents
per quart due to the incidence of the three cent advance effective from
October 1st, 1946.
An analysis of sales, as reported by the distributors, was undertaken by
the Royal Commission which disclosed that the volume of household sales
represented 73.937f of total and wholesale and storekeeper sales combined
26.07%. The latter averaged 11.43 cents per quart or 2.03 cents below retail
and had the effect of reducing the overall average price by .53 of one
cent per quart to an average of 12.93 cents.
Our examination indicated that the margin of profit on fluid milk, as
well as other products, varies appreciably between different areas and
localities.
For the fiscal year immediately preceding October 1st. 1946. it is estimated
that for the entire province the cost of whole milk to the distributor, for
resale as fluid milk, averaged 7.00 cents per quart and other costs, deprecia-
tion included, were as follows:
TABLE 10
Breakdown of fluid milk costs — per quart for the fiscal year
next preceding October 1st. 1946
% of
Cost of: Per quart Sales
Whole milk 7.00 56.86
Processing including bottles, and supplies 1.77 14.37
Distributing and selling 2.65 21.53
Administrative and general expenses .68 5.53
Total Cost 12.10 98.29
Average selling price — inclusive of subsidy
(retail and wholesale combined) 12.31 100.00
Net Profit per quart .21 1.71
The above indicates that for the year under review an average spread
existed between the cost of whole milk, per quart of fluid, and the average
selling price of the distributor of 5.31 cents per quart, of which all but
■21 of one cent was expended on costs of processing, distribution, and
administration.
As will be seen later in this report, this profit margin of .21 of one cent
has been increased as the result of the increase in consumer price effected
October 1st, 1946.
The figures shown in table 10 above are ba^ed on data furnished by
distributors. The cost of wholemilk, shown at seven cents per quart is.
however, appreciably higher than that indicated by oflficial statistics for
the year under review. This difference may be partially due to a combina-
tion of several factors, including lack of information in allocation of material
costs, shrinkage, premiums paid for high test milk, etc.
96
APPENDIX 18
Selling Prices — Fluid Milk
Consumer prices:
We believe that complete data regarding past and present selling prices
is in the possession of the Commission either in the form of evidence,
briefs, or correspondence, so that we see no useful purpose in embodying
such data in this report.
As an overall indication, the consumer price has advanced approximately
from 12c per quart in 1939 to 16c as at the date of this report, an increase
of 33 1/3%, Again as a general statement, producer prices, delivered at
plant, have advanced from $2.10 per 100 lbs. of whole milk to $3.42 over
the same period (1939-1947), an increase of approximately 65%. Different
areas and centres, of course, show varying increases.
In 1941 federal price control was introduced, followed by subsidies in
1942. The extent to which these measures may have benefited the industry
would be most difficult to determine. However, a very substantial increase
in volume occurred during the war years, particularly in the metropolitan
centres and urban districts, and this is probably the chief factor in provid-
ing the industry with perhaps the most profitable years in its history. As
the larger concerns serve the more populated areas, it seems reasonable
that they benefited to a greater degree than the smaller enterprises operat-
ing in the rural districts.
The termination of the producer and consumer subsidies in 1946 and
the lifting of ceiling prices on certain products, made necessary a review
of all operating costs as well as the purchase and selling prices of both
the producers and distributors. Negotiations took place, as a result of
which, effective October 1st, 1946, the Milk Control Board approved of an
increase in the consumer price of three cents per quart of fluid milk and
an increase in the producer selling price of $1.00 per 100 lbs. of whole
milk, equal to 2.63158 cents per quart of fluid milk.
It would appear that the distributor benefited by the difference of .36842
of one cent per quart. Thus, on an annual consumption of 430 million
quarts the additional gross revenue would be $1,584,206 over a twelve month
period.
Our survey shows that the financial position of the industry as a whole
in the Province of Ontario is the strongest since 1939, and that the overall
earnings for 1946 were not materially different from those of 1945 which
was a record year up to that time. It is also apparent that the greatly
increased sales volume of fluid milk and other products since 1939, com-
bined with improved efficiency and the continuance of certain economy
measures introduced during the war years, have not only enabled the
industry to absorb all increased costs, but also improve its financial position
and earnings on an appreciable scale.
Wholesale prices:
Under present regulations there is no distinction made by the Milk
Control Board between wholesale and retail types of businesses; the license
permitting the licensee to engage in either, and develop his own sales
policy as he chooses. Furthermore, there does not appear to exist any
specific definition of what constitutes a wholesale sale as distinct from a
retail transaction or other sale. For instance, in the Toronto area, which is
one of a number of areas in the Province where the distinction is officially
recognized, a wholesale sale is described as "any accounts except retail
accounts, storekeeper accounts and hospital accounts". (See M.C.B. Order
No. 42-2 dated January 27th, 1942.)
From information obtained it would appear that, as regards fluid milk
and cream at least, a retail sale is considered as such by the industry when
delivery is made by the distributor at the residence of the customer or sold
over the counter at the established retail prices.
Where the product is sold to a store for resale to the consumer it is
considered as a storekeeper sale, while the term "hospital accounts" would
appear self-explanatory. Thus, it would seem that any sale not conform-
ing with the terms of these three headings would be classified as a whole-
APPENDIX 18 97
sale sale, regardless of the status of the buyer or the ultimate disposition
of the product.
We understand that sales to chain and departmental stores are classified
both as storekeeper sales, and as wholesale sales depending on the pro-
visions of the related Milk Control Board Order for the locality in which
the sale is made. Where no related order exists, such sales would probably
be classified as wholesale sales.
In the aforementioned Order No. 42-2 relating to the Toronto area,
wholesale prices are set out and we understand that similar orders embody-
ing price schedules exist for certain other areas, the procedure apparently
being, in some cases at least, for the local members of the Distributors'
Association to prepare a schedule of prices for submission to the Ontario
Milk Distributors' Association and the ultimate approval of the Milk Control
Board.
In the main, the bulk of the wholesale business is done by the larger
distributors, and, as a result of our enquiries, we were advised that twenty-
five concerns might account for perhaps 60% of the entire wholesale
volume.
A tabulation of the questionnaires returned to us indicated that eleven
concerns were selling no less than 44% of their total fluid milk at whole-
sale prices ranging from one cent to two and one-half cents per quart less
than the household price, whereas, in the absence of official statistics, we
have been advised that wholesale sales might approximate 17% of volume.
Accordingly the Royal Commission decided to make an independent in-
vestigation of the monthly returns of distributors to the Statistics Branch
of the Ontario Department of Agriculture.
The analysis revealed that for the year 1946 wholesale sales represented
26.07% of total volume as shown hereunder:
Quarts
Household sales 345,796,207
Wholesale and storekeeper sales 121,939,793
%of
Total
73.93
26.07
Cents
Per Quart
13.46
11.43
Value
$46,549,915
13,938,945
Total 467,736,000 100.00 12.93 $60,488,860
We attach considerable importance to the proper recording and control
of these wholesale sales and would emphasize the need for official statistics
regarding them.
Mention might also be made of the prices announced by the trade follow-
ing the price increase of October 1st, 1946. The Windsor and district trade
advanced the prices of pints and half pints of milk, chocolate drink, and
buttermilk by the equivalent of four cents per quart, the prices of quarts
and gallons only being increased by the three cents authorized.
Under the heading of "Costs and Profit Margins by Products", (table 9),
we have given the overall average selling prices of certain products for the
fiscal year next preceding October 1st, 1946. Below in table 11 we give a
few selections of the average wholesale and retail prices prevailing in
certain counties.
TABLE 11
Comparison of Wholesale and Retail Prices for the Fiscal Year next
Preceding October 1st, 1946
Average Average %
Retail Price Wholesale Price Wholesale
(Cents) (Cents) Discount
Essex County
Fluid Milk 13.33 qt. 11.14 qt. 16.43
Fluid Cream 41.00 qt. 31.39 qt. 23.44
Chocolate Drink 16.08 qt. 12.71 qt. 20.96
Buttermilk 10.10 qt. 8.31 qt. 17.73
Butter 40.17 lb. 38.24 lb. 4.80
York County
Fluid Milk 13.67 qt. 11.00 qt. 19.54
Fluid Cream 41.00 qt. 37.10 qt. 9.52
Chocolate Drink 15.00 qt. 13.33 qt. 11.14
98 APPENDIX 18
Buttermilk 9.00 qt. 6.00 qt. 35.00
Butter 45.00 lb. 42.00 lb. 6.67
Frontenac County
Fluid Milk 12.56 qt. 10.27 qt. 18.24
Fluid Cream 59.25 qt. 46.56 qt. 21.42
Chocolate Drink 13.10 qt. 12.41 qt. 5.27
Buttermilk 5.00 qt. 4.01 qt. 19.80
It will be noted that there is no uniformity between the average prices of
the various products in the different counties or in the wholesale discount
rate.
As regards the Toronto area. Milk Control Board Order No. 42-2 pro-
vider "'inter alia" for the following wholesale discounts:
Standard Milk 2^2 cents per quart
Chocolate Drink 1^2 cents per quart
Buttermilk 3 cents per quart
Hospital Milk 4^2 cents per quart
Having regard to the profit margins on the fluid products referred to
and the fact that the related Board Order is dated 1942, the above scale
of discounts might well be reviewed.
In discussing wholesale and other special prices with the Milk Control
Board, we understand there is no systematic check made by board
officials regarding so-called wholesale transactions. According to the
Board only occasional complaints of price cutting have been received from
distributors.
Prices of Plant or Surplus Sales:
In the form of questionnaire under the classification cf sales by type of
outlet, provision w^as made for reporting particulars of retail, wholesale,
and plant or surplus sales.
Four concerns in different cities reported sales under the latter heading
at prices ranging from 3.16 cents per quart to 7.95 cents per quart, the
individual volume ranging from less than 1% of total sales to over llTr.
Taking the four concerns combined the fluid milk sales aggregated 5,094.578
quarts of which 269.570 quarts or slightly more than 5% were classified
as plant or surplus sales, the average price of which was 6.88 cents per
quart or practically half the then prevailing retail price.
The prices repoi'ted to us and the discounts off retail prices are as
undernoted:
Price Discount off
per quart retail price
Fluid Milk 6.88 cents 45.23%
Fluid Cream 40.01 cents 32.48%
Chocolate Drink 10.63 cents 18.86%
Buttermilk 2.97 cents 40.60%
We are of the opinion that such sales should be fully enquired into by
the Milk Control Board and, if necessary, provision made for them to be
reported each month to the Statistics Branch of The Ontario Department
of Agriculture as such prices would necessarily have the effect of reducing
the overall average price of fluid milk sales and the other products involved,
if in sufficient volume.
Price Spread — Fluid Milk
Complete information regarding the purchase prices of whole milk is.
w-e believe, in the possession of the Commission either in the forrn of
evidence, briefs or correspondence. Accordingly, w^e propose limiting
our comments under this heading to certain general observations.
In the consideration of price spreads, as with selling prices, allowance
should be made for that volume of production sold at wholesale and other
special prices, but as we have indicated, there is no statistical mformation
available to show the proportion of wholesale volume to total sales either
currently or for past years.
APPENDIX 18 99
Based on the monthly dah-y reports issued by the Ontario Department
(if Agriculture, the overall average selling price realized by distributors for
fluid milk sales in 1946 was 12.09 per quart, exclusive of the consumer
subsidy which was terminated in May of that year. In 1945 the average
was 10.31 cents and in 1944 10.37 cents per quart on the same basis.
From the same source we find that the average cost of whole milk
purchases for fluid consumption in 1946 was $2.66 per 100 lbs. or 7 cents
per quart on the basis of 38 quarts per 100 lbs. This indicates a gross
spread of 5.09 cents per quart giving a gross margin of 72.71% on raw
material cost exclusive of subsidy.
The overall average revenue per quart for the year 1946 was 12.93 cents.
With a raw material cost equivalent to 7 cents, the spread becomes 5.93
cents showing a gross margin of 84.71%.
For the first four months of 1947 the overall average selling price per
quart is reported at 15.20 cents. Thus, over the period 1944 to 1947 the
revenue per quart, inclusive of .subsidy, where applicable, has been as
follows:
1944 12.37 cents
1945 12.31 cents
1946 12.93 cents
1947 15.20 cents
During the first three months of 1947 the cost of whole milk purchases
has averaged $3.42 per cwt. delivered at plant, which on the basis of 38
quarts per 100 lbs. is equivalent to 9 cents per quart leaving a spread of
6.20 cents or 68.89% gross margin.
Regarding 1939 the average cost of whole milk for fluid purposes to the
distributor approximated $2.10 per cwt. equal to 5.53 cents per quart on a
38 qt. basis. Against this the overall average selling price approximated
11.50 cents per quart giving a spread of 5.97 cents per quart equal to 108%
gross margin. Thus, the following trend is indicated:
TABLE 12
Trend in Selling Prices and Gross Margins
Overall Average
Average Cost to
Selling Price Distributor Gross
Per Quart Per Quart Spread
(cents) (cents) (cents)
1939 11.50 5.53 5.97
1946 12.93 7.00 5.93
1947 (to April 30) 15.20 9.00 6.20
It will be noted that on the basis of fluid milk quarts, the whole milk
purchase price has increased by 3.47 cents since 1939, while the overall
average selling price has advanced 3.70 cents so that the distributive
industry today would seem to be better off by 23 cents per 100 quarts than
in 1939. Taken in conjunction with the increased volume this constitutes
an appreciable advantage.
This observation is predicated on the accuracy of official statistics which
as we have pointed out on page 45, appear to show an appreciable differ-
ence. (55c per 100 quarts), from the costs reported by the distributors.
Producers' subsidies hav^e quite properly not been taken into account in
either calculation.
Purchases oj Whole Milk at Secondary Prices
Distributors have always been required to pay the basic price for fluid
milk sales but a change in the determination of quotas has occurred since
1942 which has some bearing on the subject.
Prior to that time secondary milk purchases for the different areas were
covered by separate Board orders, although in principle they were much
the same, whereas at present such purchases are covered by one provincial
wide order. When this change occurred, in 1942, quotas were required to
approximate sales, whereas before, the quotas were set in excess of esti-
mated sales.
Under this latter arrangement distributors were required to pay at least
85% of the quota at the basic price, even though such portion might exceed
100
APPENDIX 18
actual fluid milk sales, no more than 159^ of the quota being eligible for
purchase at the secondary price and then only for purposes other than
fluid milk sales.
The regulations now in force require the distributor to pay the basic
price for either the quota or sales quantity whichever is the higher, there
being no obligation on the producer to deliver in excess of such quantity.
If, however, with the consent of the distributor, he elects to do so,
secondary price can apply on any quantity they may agree upon, provided
of course the milk is used for other than fluid purposes.
Official statistics indicate that in each of the years 1945 and 1946 whole
milk purchases by commercial dairies exceeded fluid milk sales by about
160 million pounds, but there are no records to show the products, or
quantities of each, into which such purchases have been converted, neither
are there statistics to show the quantity which was paid for at the second-
ary price.
In discussing the matter with the Milk Control Board we were assured
that only a very small proportion, if any, would be processed into fluid
milk. Virtually all would be converted into products for which the
secondary price is applicable, such as cream and packaged cheese, chocolate
drink, buttermilk, etc.
In support of this statement we were informed that inspectors and
auditors of the Board make test checks of the records of distributors about
twice a year and complete form number E1998 at the completion of each
inspection. This applies to markets other than those where the producers,
by arrangement with the distributors, have their own auditors conduct
such examination, as in Toronto and certain other markets. Our enquiries
also elicited that there occasionally occurred instances where whole milk,
purchased at the secondary price had been processed into fluid milk and
sold at the retail price, but the quantities involved were said to be insig-
nificant and remedial measures, satisfactory to the Milk Control Board,
had been taken in every case.
As regards the supply of whole milk at the secondary price the position
is equally obscure. We are informed that the distributors draw from the
regular producers as well as the cheese factories, creameries and condens-
aries, but the quantities drawn from each source and the prices paid are
not known. In this connection we made certain comparisons between the
average prices paid for whole milk and the basic prices applicable to certain
markets. These indicate that purchases are made at the secondary price
in most markets throughout the Province and that the quantity purchased
may be quite substantial in the aggregate although varying considerably
between different markets.
The spread between the basic price and the secondary price varies
between districts (the butter-fat premium is also slightly different), but
as a general indication the secondary price approximates $1.00 less per 100
lbs. than the basic, a considerable reduction and sacrifice from the pro-
ducer's viewpoint, but one which they were evidently prepared to make,
provided the distributors used such secondary purchases in products other
than fluid milk.
In this connection we have the assurance of the Milk Control Board that
reasonable precautions are taken and the necessary procedures are in effect
to keep any abuse to a minimum, but having regard to the lack of basic
statistical data, without which the proportions and complexities of the
problem cannot be properly assessed, we find it difficult to understand how
such an important matter can be fully and satisfactorily controlled.
We believe that this subject should be discussed with the Statistics
Branch and the producers' and distributors' associations without delay, as
some clarification seems desirable so far as the monthly dairy report itself
is concerned. As we have indicated the Milk Control Board claims that
little, if any, of the secondary milk is converted into fluid and sold at the
established prices, yet the quantity, whatever it might be, is included in
the dairy report under the heading of '"Total purchases of milk and cream
by commercial dairies for fluid sales in Ontario."
APPENDIX 18 101
Consumer Subsidy
A consumer milk subsidy of two cents per quart v/as introduced by the
Dominion Government effective December 16th, 1942, and continued until
May 31st, 1946, when it was terminated. During this period of approxi-
mately 31/2 years the sum of $29,649,963.97 was disbursed by the Dominion
Government agency and paid to the fluid milk distributors in the Province
of Ontario. This amount averages $8,471,418 per annum and may be appor-
tioned as follows:
1942— December 16th to the end of 1943 $ 8,856,010
1944 8,199,280
1945 8,658,814
1946— January Ist-May 31st 3,935,860
$29,649,964
The subsidy was paid as part of the Dominion Government's overall price
control and supply policy as applied to essential foods, materials, and com-
modities, and accordingly the consumer price was "rolled back" by 2c per
quart and subsidy for a like amount paid to the distributors.
The arrangement was beneficial to the consumer as well as the dis-
tributor and producer, inasmuch as consumption was no doubt stimulated
and volume production and supply thereby promoted. The effect being to
place the consumer price on a par with that prevailing in 1934, a year of
depression.
In this connection it is interesting to note that the overall profits of
Ontario distributors in 1943, the first full year of subsidies showed a marked
increase over those of 1942. There is in fact no evidence that the industry
took any "squeeze" as the result of increased labour and other costs.
Individual overall operating results, as well as for representative groups
of concerns, all show a progressive improvement in earnings both in terms
of dollars as well as percentagewise, from the time subsidies commenced
up to the close of 1945 at least.
Subsidy payments are, of course, subject to the application of standard
profits and taxes as determined under the provisions of the Dominion
Excess Profits Tax Act so that where overpayments to individual concerns
have occurred, recovery would be made by the Federal government if it
has not already been effected. In this connection we should point out that
based on the data furnished in the questionnaires, there would appear to
be a number of assessments under appeal in respect of both the large and
medium sized concerns.
The foregoing observations relate to the subsidy known as the "con-
sumer" subsidy. That which was paid the producers and which at the
same time served to protect the distributors' costs and supply of whole
milk as well as the consumer price is another matter, which is moi'e
properly related to the operations of the producers. This subsidy was
latterly the equivalent of 1^/2 cents per quart of fluid milk.
Diversification of Product and Effect on Earnings
Amongst the several hundred independent distributors of fluid milk
in Ontario are eighty-five concerns (of which 45 are incorporated com-
panies) who process and distribute ice cream, butter, cheese, etc., in addition
to fluid milk, fluid cream, chocolate drink, and buttermilk, as do the three
largest distributors.
Some of these 85 concerns, although regarded as distributors of fluid
milk, would, in our opinion, be more properly classified as creameries or
condensaries. Of the total, we have taken 55 as being fluid milk distributors.
Our tabulations indicate that the total sales of these 55 independent
concerns engaging in combined operations amounted to $16,114,722 for the
fiscal year next preceding October 1st, 1946, with net profits (before taxes)
of $533,397, representing 3.31% thereof. In this regard the following table
may be of interest:
102 APPENDIX 18
TABLE 13
Statement of ovei'all sales and net profits for the fiscal year next preceding
October 1st, 1946 showing operating results of fluid milk distributors
engaged in combined operations in relation to totals for industry
% of Net Profits % of % of
Sales total (before taxes) total Sales
55 Independents S16,114.722 18 $ 533.397 16 3.31
Three largest concerns 35,472,455 39 1,593,263 48 4.49
Totals for combined operations. .. $51,587,177 57 $2,126,660 64 4.12
Regular fluid milk distributors
not engaged in combined
operations 38,412,823 43 1,167,340 36 3.04
Total for industry $90,000,000 100 $3,294,000 100 3 . 66
The foregoing shows the improved rate of earnings resulting from
diversified production. At the same time it affords an indication of the
important contribution to industry sales and profits of the 58 separate
organizations engaging in combined operations.
Productive Capacity
Our survey shows that in 1946, at least, the great majority of dairies
were operating their fluid milk processing plants at full capacity the
year round, on a single shift basis of 48 hours per week although sharp
seasonal fluctuations were noted in a few instances principally amongst
the smaller proprietory concerns operating in rural districts catermg to
summer trade.
Two instances came to our notice where the productive capacity on a
single shift basis was considerably greater than the sales volume and in
each case the concerns showed operating losses.
Generally speaking, however, the fluid milk processing plants them-
selves have a capacity which on a single shift basis of 48 hours per week
is rather more than sufficient to take care of daily requirements, a margm
being provided to enable processors to meet emergency situations resultmg
from delays in deliveries due to inclement weather conditions and peak
periods of production.
Overall it would appear that the independent operators, at least, are
fully equipped to process fluid milk at a rate per day of eight hours for six
days per week — sufficient to ensure the prompt processing of whole milk
delivery from the producer on the one hand, and adequate supplies of
fluid milk to the consumer on the other.
Any appreciable contraction in the sale of fluid milk to consumers would,
therefore, affect costs of production, since present fluid milk plant capacities
are geared to an output of almost twice that of 1939.
Breakdown of Overall Sales and Net Profits (before taxes) for the
Fiscal Year Next Preceding October 1st, 1946
So far as we are aware, a breakdown of the overall sales and net profits
of the fluid milk distributive industry has not previously been attempted
due to lack of statistical data, yet, having regard to the interdependence
of one product on another where combined operations are engaged m, n
seemed important that a condensed, yet comprehensive, statement be
prepared.
We believe the information furnished in table 14 below affords a reason-
ably accurate indication of the relative importance of the products men-
tioned from the viewpoint of both sales volume and net profits for the
fiscal year next preceding October 1st, 1946.
If similar data was assembled for future years, on a quarterly basis,
those connected with the administration of the industry would be better
informed regarding overall earnings and seasonal trends.
APPENDIX 18
103
TABLE 14
Breakdown of overall sales and net profits (before taxes) by products for
the fiscal year next preceding October 1st, 1946 (as estimated)
Units
Fluid Milk, . .432,857,500 qts.
Fluid Cream 12,366,900 qts.
Chocolate
Drink 16,322,700 qts.
Ice Cream 5,600,000 gals.
Butter 20,000,000 lbs.
Cheese 1,500,000 lbs.
All other —
lies
Amount
per
Unit
(cents)
Net Profits
Amount %
per
Unit
(cents)
$53,284,758
5,441,436
2,250,900
6,552,000
7,600,000
300,000
14,570,906
12.31
44.00
13.79
117.00
38.00
20.00
$911,169
326,486
225,090
982,800
(152.000)
10,500
989,955
1.71
6.00
10.00
15.00
(2.00)
3.50
6 80
.21
2.64
1.38
17.55
(.76)
.75
$90,000,000
$3,294,000
3
3.66
The above table indicates that whereas for the fiscal period referred
to, fluid milk sales approximated 60% of total volume, it contributed only
28% of overall profits, a lesser sum than ice cream sales which represented
7% of total, whereas the related profits equal 30% of overall earnings.
The items included under the heading "all other" comprise substantial
amounts in respect of concentrated milk products and eggs, also lesser
sums for poultry and frozen confections as well as revenues from storage
rentals and the sale of ice.
. Estimated Overall Net Projits for the year 1946
The estimates of overall net profits, before provision for Dominion
income and excess profits taxes, which were received in response to our
circular letter of December 7th, 1946, were compared with the actual
earnings for the fiscal year next preceding October 1st, 1946, and some
correspondence engaged in where there appeared to be unaccountable dis-
parities. In certain cases the actual results for 1946 were obtained before
completing our tabulation.
Our final figures, which were assembled by zones or milk sheds, led to
the conclusion that the overall net profits of the industry from domestic
sales for the year 1946, before provision for Dominion income and excess
profits taxes would, in terms of dollars, closely approximate those of the
previous fiscal year.
Outlook for 1947
As regards the current year, the present indications are that there may be
a contraction in fluid milk sales and possibly other products which carry
wider profit margins than fluid milk, but it is exceedingly difficult, if not
impossible, to predict with any degree of accuracy, the extent to which the
overall earnings of the industry may be influenced.
There is not only the matter of considering the extent of any fluctuation
in the sales volume of each product, and gauging the effect of each on
combined earnings, but also the extent to which costs might be influenced
as a result of the volume variation, aside from possible increases or
decreases in the costs of labour, operating supplies and expenses.
Counter to the foregoing are the increased earnings which may be
expected from the recent increases in butter and cheese prices also the
effect, over a twelve month period, of the recent increase in the consumer
price of fluid milk.
Considering all aspects there seems a likelihood that the earnings of the
industry for 1947 will at least approximate those of 1945 and 1946 which,
as we have stated, were record years.
Income and excess profits taxation as applied to the industry
The tabulations include 118 incorporated companies in the fluid milk
distributive industry including the three large concerns. With the exception
'104 APPENDIX 18
of a few co-operative organizations, practically all of the remainder of
the industry is composed of proprietory or partnership businesses.
The profits of the latter type of business are included in the personal
income tax returns of the owners and only in a few instances is the amount
of such tax disclosed in the financial statements relating to the business.
With regard to the three large concerns, calculations indicate that, for
the year next preceding October 1st, 1946, they have, collectively, paid
income and excess profits taxes to the extent of 58.5% of earnings, after
taking into consideration the refundable portion. The combined net profits
from operations in the Province of Ontario are stated at $1,593,263 on
which income and excess profits taxes of approximately $932,059 would
be provided for on the foregoing basis.
As regards the independent companies, their ratio of taxation to operating
profits is less. For the fiscal year next preceding October 1st, 1946, their
income and excess profits taxes are estimated at 49.3% of total earnings,
after taking into consideration the refundable portion. The combined profits
of the 115 independent incorporated companies are estimated at $850,000
on which income and excess profits taxes of approximately $419,050 would
be provided for on the foregoing basis.
Thus, for 118 incorporated companies in the industry, including the three
largest concerns, earnings of $2,443,263 are estimated in respect of the
fiscal year next preceding October 1st, 1946, and on the above mentioned
basis income and excess profits taxes would be $1,351,109, equal to 55.3%
thereof.
The 1946 and 1947 Budgets of the Dominion Government provided for
appreciable reductions in the scale of taxes. Allowing for these, and
assuming that overall earnings will be maintained at about the same
level, it is estimated that the total Dominion and Provincial profits taxes
to be provided for in respect of 1947 operations of all incorporated com-
panies in the industry, located in the Province of Ontario, will not exceed
$1,058,161. This indicates an estimated saving of $292,948 as compared with
the fiscal year next preceding October 1st, 1946.
Taking the entire fluid milk distributing industry of the Province,
including proprietory and partnership businesses, it might well be that
as a result of the net reductions in taxation applicable to 1946 and 1947,
the industry may benefit to the extent of more than $400,000 in 1947 as
compared with 1945.
Observations and conclusions
Financial position and overall operating results:
The investigation clearly shows that the financial position of the mde-
pendent distributors, as well as the three largest concerns, has materially
improved since 1939 as the result of increased sales volume and operating
profits and the general financial policy followed by the majority of
concerns of re-investing earnings in their business by improvements and
additions to plant and equipment and improving the working capital
position.
In 1939 fluid milk sales in the Province of Ontario were 250,405,000
quarts; in 1946 they were 467,736,000 quarts, an increase of 87%.
Our tabulations of questionnaires, combined with other data, indicate that
the overall domestic dollar sales of the industry have doubled since 1939
and that the overall net profits (before taxes) from domestic sales have
also doubled during the years 1939 to 1946 inclusive, each year showing
a progressive improvement.
The scale of overall earnings in relation to both sales and capital
employed can only be regarded as being satisfactory from the industry
viewpoint.
As regards 1947, although conditions have changed since 1945 and 1946,
there appears to be little ground for anticipating a contraction in overall
earnings. Although the present indications are that fluid milk sales may
not equal those of 1946, we have indicated that there are some important
compensating factors.
APPENDIX 18
105
Net profits jrom sales oj fluid milk:
It appears that the profit margin on sales of fluid milk approximated .21
of one cent per quart during the fiscal year next preceding October 1st,
1946. We should, however, emphasize that such margin represents the
average profit on all fluid milk sales, including sales to storekeepers,
wholesalers, and others, which we have indicated were substantial and
carried an overall average discount of 2 cents per quart during the
period referred to.
Were all sales made at the regular consumer prices, the profit margin
per quart for the fiscal period referred to would be increased by approxi-
mately one-half cent, less whatever the increased cost of selling and
delivery expenses for retail deliveries might be, as compard with the
cost of wholesale deliveries.
The proportion of wholesale sales to total volume and the discounts given
on such sales are matters of extreme importance in the consideration of
consumer prices. Yet, as we have stated, the authorities have presently
no statistical data on either.
It could well be that a thorough investigation of wholesale sales on an
industry wide basis would indicate that a reduction in the volume of so
called "wholesale business" and the discounts of such sales could be
effected resulting in an appreciable contribution to overall profits.
Reference should also be made to purchases of whole milk at secondary
prices, an important factor from the producers' viewpoint, as well as that of
the distributor and consumer.
On account of the substantial quantity involved it may have considerable
bearing on the profit margins of fluid milk.
The foregoing relates to the period prior to October 1st, 1946. On this
date the consumer price was advanced by 3 cents per quart, mainly to
compensate the producers for loss of subsidy and to offset, to an extent,
increased costs.
Official statistics show that the average overall price received by the
distributors since October, 1946 has been 15.2 cents per quart and, of
the increase of 3 cents, 2.63 cents goes to the producer to replace the
producer subsidy of 55 cents per 100 lbs. and provide for an additional
45 cents per 100 lbs. to cover increased farm costs, the balance of .37 of
one cent per quart being retained by the distributors.
Thus the distributors are now averaging a net profit (before taxes) of
.58 of one cent per quart as compared with .21 of one cent being the net
profit as reported for 1945 and 1946. They may in fact be averaging
slightly more as the selling prices of pints and half pints were adjusted on
October 1st, 1946 on the basis of four cents per quart in some areas.
This additional revenue may be offset to some extent by increased costs
of processing and distribution over the 1946 level, but at the time of this
report there is not sufficient data available on which to base an estimate
for the industry as a whole.
Undoubtedly the profit margin on fluid milk sales will show considerable
improvement in 1947 over the past.
Possible increases in sales revenues:
(a) As the result of the recent increases in the retail prices of cheese
and butter, some benefit should accrue to the distributors in 1947.
So far as the distributive industry is concerned butter has made little,
if any, contribution to overall profits in recent years. In some instances
it appears to have been employed as a loss leader by certain distributors
and if this condition were remedied, some improvement in earnings should
result.
(b) The present spread between so-called wholesale prices and consumer
prices might be narrowed and a closer control exercised on all sales made
at less than the retail prices. Under existing conditions it could well be
that the consumer is subsidizing the wholesale trade to some extent at least.
(c) Before adjustment of any prices, careful consideration should be
given to probable effects on volume. In the fluid milk industry the
importance of volume can hardly be over emphasized.
Possible Savings and Economies:
In a recent letter from Professor Spencer, of Cornell University, x-ecog-
nized authority on marketing of milk, he comments on every-other-day
delivery as follows:
106 APPENDIX 18
"Practically everyone is very well pleased with the e.o.d. plan of
operation. The milk companies have lower costs and more profit,
the drivers get more pay for fewer hours of work, and the farmers'
milk reaches the consumers at lower prices than would have to
be charged if deliveries were made every day. So far as I know
the e.o.d. plan of retail delivery still is practically universal in
the United States."
(a) The matter of pooling delivery service has been the subject of con-
siderable discussion from time to time, but there still seems to be variance
of opinion regarding its practicability.
(b) Store deliveries, alternate daily deliveries, overlapping of routes,
territorial limits as well as elimination of Sunday deliveries are also
matters which should be given immediate consideration having regard to
the savings that could be effected.
As regards store deliveries we have found that if conducted in conjunc-
tion with milk or dairy bar operations, satisfactory trading results are
frequently attained, net revenues providing an appreciable contribution
to overall earnings. Much depends of course on the location, sales volume
by products, management, control, and other factors.
(c) It is estimated that the annual cost of vehicle operation for the
industry, including depreciation, repairs, insurance and operating supplies,
but excluding drivers* or salesmen's wages, approximates $5,000,000, repre-
senting about 5V2% of total sales revenue or approximately .80 of one cent
per quart.
Comparisons between different concerns of comparable size and type
show marked contrasts in the matter of delivery expense and we hold the
view that careful study of store and vehicle operations on a comprehensive
basis would be productive.
Delivery costs are one of the most important factors in the ultimate cost
to the consumer, yet the standard of the replies to our questionnaire showed
room for much improvement in the matter of suitable records essential to
proper control.
(d) The fluid milk distributive trade in the Province of Ontario requires
the use of a great many vehicles, both automotive and of the horse-drawn
type; it is estimated that in a normal year annual purchases exceed
$1,200,000 per annum.
The collective purchasing of replacement equipment might be a practical
and economical proposition, and is worth considering by the independents.
(e) Our survey disclosed that the majority of distributors are availing
themselves of the maximum depreciation rates allowed under the Dominion
income tax regulations. The application of these rates results in substantial
charges against operations in addition to appreciable repair and maintenance
costs and we are inclined to the view that, taking the industry as a whole
the present rates may be higher than are actually warranted.
Records and Statistics:
It is our opinion that opportunities for the correction of uneconomic
practices within the industry would reveal themselves were steps taken
to improve the statistical and accounting standards of the industry.
The problem of obtaining accurate and informative data with reasonable
promptitude from such a heterogeneous industry as the milk distributing
trade is most difficult. This is amply borne out by the difficulties we
ourselves encountered in obtaining financial statements and other data
essential to the survey, and our endeavours to secure completion of the
questionnaires.
It is apparent that the great majority of small and medium sized
enterprises, as well as some of the larger concerns, do not maintain adequate
statistical data; while their accounting standards and records leave much
to be desired.
While recognizing these difficulties, we are of the opinion that, having
regard to the public interest in such an essential food industry, it is most
urgent that it be made fully aware of the advantages of maintaining
adequate records, and indeed its obligation to do so, in order that those
governmental authorities or persons who are charged with safeguarding
the interests of the public and affiliated industries in such a vital food
APPENDIX 18 107
product are in possession of accurate and informative data both as to past
experience and future trends.
We suggest that the entire problem be carefully studied and consultations
held with all interested parties, including the related trades associations,
with a view to deciding first upon the minimum requirements and then
the "modus operandi".
It is also suggested that consideration be given as to the advisability of
the Ontario Department of Agriculture (Statistics Branch) obtaining more
complete information regarding the breakdown of the overall volume of
the industry. For example, the provincial authorities are presently de-
pendent on the Dominion Bureau of Statistics regarding sales volume of
ice cream, yet this product is one of the most important factors in the
overall profit position of the industry.
If, in the establishment of selling prices of fluid milk and cream, regard
is to be given to the profits or losses relating to other products, the volume,
prices and profit margins of such other products should be known to those
provincial authorities responsible for the observance of fluid milk and
cream regulations.
Purchases of whole milk at secondary prices and the products into which
such milk is converted are important matters not only to the distributors
but also to the producers and the consuming public. The statistical data
presently available is in our opinion inadequate to ensure a proper degree
of control on such a vital matter.
We should mention the desirability of the trade associations, the Milk
Control Board, as well as the Department of Agriculture, reaching a clear
understanding as to the proper classification of individual enterprises.
In connection with the survey we have required certain listings of
individual concerns by category, i.e., fluid milk distributors, creameries,
cheese factories, and condensaries. These lists revealed duplications, also
apparently incorrect classifications; viz., creameries being listed as dairies
and the reverse.
With combined operations, or diversified production, there may be some
difficulty in effecting a proper classification under existing headings, but
on account of the considerable spread in profit margins between the four
groups, incorrect allocation can result in misleading conclusions. For
instance, the inclusion of a number of creameries in a tabulation of dairies
would result in the overall profit being understated under price ceilings
that were in effect prior to April 30th, last. Conversely, the inclusion of
dairy returns with those relating to creameries would result in the profit
position of creameries being overstated.
We are not aware of the existence of any records regarding capacities
of fluid milk plants by areas, which would serve to show the degree of
balance between the producers of whole milk, the capacity of fluid milk
plants, and the consumer demand, on a year round basis as well as for
peak periods.
If the industry continues on the present basis of independent competition
with local supply and demand factors more or less determining its policy,
such statistical data would be of value to those responsible for protecting
the public interest and public policy, and would be of value to the industry.
In the light of our experience, we believe that if any of the suggestions
made in this report regarding the introduction of improved accounting
standards and statistical data are adopted, the quickest and best results
would be attained through initially arranging for personal visitations to a
few selected concerns that would provide a representative cross-section of
the industry, this to be followed up by the preparation of the requisite
forms and instructions for the entire industry. Such procedure would,
amongst other things, ensure elimination of superfluous matter and reduce
the risks of misinterpretation.
These and many other points should, we believe, receive the most
careful study in the interests of the industry itself, its affiliates, as well as
that of the producers and the consuming public.
Export Sales:
The profits derived from export sales by the concern included in our
tabulations were substantial, both in terms of dollars and on a percentage
108 APPENDIX 18
basis. As already mentioned, expoi't sales and profits thereon have been
excluded for the purposes of this report.
It should be noted that the producer receives considerably less for milk
used for manufacturing purposes than for fluid sales whereas the manu-
facturer retains in full, any advantage which may exist between export
selling prices and domestic. Consideration m.ight, therefore, be given to
adjustment of milk prices to the producer or alternatively a division made
of the profit realized on export sales.
Amalgamations and Absorptions:
It is suggested that present procedures and regulations which may relate
to, or have a bearing on, the amalgamation or absorption of fluid milk
distributive businesses within the Province be reviewed with particular
regard to their adequacy from the viewpoint of the public interest and
that of the industry at large.
In the course of our survey we enquired into a few of the more recent
absorptions and found that the ultimate objective of such transactions
may not always be apparent. It would seem, therefore, that in such a vital
and basic industry sufficiently comprehensive regulations are desirable.
Overall Operating Results
Three Large Concerns:
The report shows that the combined rate of earnings in relation to sales
is considerably more than the rate applicable to the independent operators,
whereas the return on capital employed, as computed substantially in
accordance with the provisions of the Dominion excess profits tax act, is
approximately the same.
As regards sales the three large concerns account for 39% of the estimated
total for the whole Province, while their related earnings represent 48%
of the total net profits.
It must, therefore, be granted that, combined, they constitute a dominant
factor within the fluid milk distributive industry in the Province of Ontario.
This position has been attained over the years since 1928, largely by the
acquisition of other businesses on terms which were no doubt attractive
to both the purchasers and the vendors.
This report shows that, according to the latest available figures, the three
large concerns combined placed a goodwill valuation on these acquisitions
of $20,300,560 more than the depreciated or net book value of the tangible
assets taken over.
Whether such sum was partially paid in cash or was mainly represented
by the excess of the stated market value of the shares involved over the
nominal or par value, or a combination of both, is immaterial from the
viewpoint of this report. Neither is it of great importance whether such
sum was recorded on the books or not, or since written off, (only $389,585
is presently reflected in the balance sheets). The fact remains that it
reflects the purchasers assessment of the goodwill value of the businesses
acquired as going concerns.
Having regard to the satisfactory rate of earnings of the three large
companies and their strong overall financial position it is evident that
the acquisitions of the various businesses as going concerns had considerable
financial merit.
There is also the inference that for many years past the large operators
have had a high degree of confidence in the potential earnings of the fluid
milk distributive industry and its ability to provide a satisfactory return
on both sales and capital employed under efficient management.
Increase in the Price of Fluid Milk
Authorized in October, 1946:
We are aware of the extent and nature of the negotiations and enquiries
which were made by the Milk Control Board and the amount of data which
was submitted to it before the increase of three cents per quart was
authorized last October. There are, however, some points which have an
APPENDIX 18
109
important bearing on the matter, concerning which there seems a likelihood
that the Board may not have had all pertinent data.
Firstly, there is the matter of wholesale sales. There were no official
statistics showing the volume of milk sold at reduced prices to wholesalers,
storekeepers, hospitals, etc., yet such sales in terms of quarts have just
been found, by special investigation to represent 26.07% of the total for the
year 1946 as compared with a lower estimate furnished by the Milk Control
Board.
The discount on such sales ranges from one to four and one-half cents
per quart and our calculations show that the total wholesale sales provide
an average overall reduction from the consumer price of 2 cents per quart.
This amount, in conjunction with the volume, has the effect of reducing the
overall average selling price of all fluid milk sales by one-half cent per
quart, thereby reducing the apparent profit margin.
Secondly, we would refer to the costs and profit margins by products
which we have obtained in the course of our survey.
Wide disparities exist in the profit margins of almost every product,
including fluid milk, not only between the different zones but also between
individual concerns, operating in the same area, which can only be
accounted for by one or more of the following factors:
1. Variations in the average selling price realized due to differing propor-
tions of wholesale, store and other classes of business carrying discounts
off the consumer price. For instance, if a concern specialized in wholesale
trade to the exclusion of retail the selling price realized on fluid milk would
average 2 cents per quart less than if engaged in exclusive retail trade.
2. Lack of uniformity in accounting practice and in particular the
apportionment of overhead and indirect expenses.
As we have stated in the report few concerns maintain production cost
records and those that do use different methods of applying overhead.
Some use dollar sales, others unit quantities, material costs or some other
basis.
3. Variations in the efficiency of manpower and machines, including
delivery vehicles.
4. Variations in the degree of management and accounting standards and
control affecting economy of operations.
5. Variations in intere-st charges due to differences in amount of borrowed
capital.
6. Variations in proprietors' and partners' salaries or drawings. (In our
survey this has been countered by the application of a pre-determined
scale based on sales volume.)
The extent to which the foregoing were enquired into and considered
before deciding to increase the consumer price by three cents per quart
is not known, but their effect is clearly demonstrated by the following
tabulations of the Royal Commission:
Cents per quart of fluid milk
Three largest concerns :
(Average on all sales of fluid milk)
Independents located in :
Windsor
Windsor
Toronto
Toronto
Profit
Cost Selling price (before taxes)
12.6152 12.7067 .0915
11.7500 12.0600 .3100
11.9900 12.1500 .1600
12.3310 12.6460 .3150
(One of the three large concerns
shows a cost of 12.3400 per quart
and a profit of .3900 for the
Windsor area)
10.9233 11.0373 .1140
12.4590 12.8130 .3540
There are many other instances which could be cited but the foregoing
demonstrates the point in question. It will be noted that the average
110 APPENDIX 18
selling prices for two companies located in Toronto differs by 1.7757 cents
per quart and the profit of one is more than three times that of the other
yet the cost per quart is 1.5357 cents higher. Marked contrasts also occur
even amongst the three largest concerns. These differences may appear
trifling on a unit basis but it should be remembered that on a volume of
400 million quarts per annum a tenth of a cent error results in a discrepancy
of $400,000. Thus in such a volume business as the fluid milk industry the
seemingly trifling sum reaches tremendous proportions. By the same token
the smallest economy can have the most significant effect on earnings.
The third point we would refer to is the degree of diversification of
product.
Our survey shows that, according to the information submitted by the
industry, the return on fluid milk sales, for the fiscal year next preceding
October 1st, 1946, was only 1.71% based on various combinations and
tabulations made by us from the data in our possession.
It is not clear to us whether the price increase of October last was
intended to make the fluid milk business self-supporting. If it was, then
we are of the opinion that the price increase has achieved that objective.
However, it would seem that the industry has not operated on that basis
in recent years at least. Information submitted leads to the conclusion
that the trend has been toward the development and expansion of sales of
other milk products, including ice cream, which undoubtedly carry more
attractive profit margins.
Admittedly these indications largely relate to the war years, the survey
covering the years from 1939 to 1947, and it may be that the industry
considers such policy to be unsound in the post-war era and for the future.
As a result of the price increase the position of the several hundred
smaller distributors throughout the Province who do not engage in diversi-
fied production on any scale will be considerably improved and the increase
in so far as they are concerned may be justified. However, there are almost
one hundred larger concerns operating principally in the metropolitan and
urban centres throughout the Province which engage in diversified opera-
tions on an appreciable scale and whose overall earnings as a result were
already attractive before the price increase was authorized.
The majority of these concerns have paid substantial excess profits taxes
in recent years and their overall earnings are such that any price fixing
body would have found it most difficult, if not impossible, to justify any
further increase in revenues to such concerns as a group. The increase
actually realized by the distributors according to their brief is .37 of one
cent per quart of fluid milk which widens the spread between prime costs
and selling prices by approximately $1,591,000 based on annual sales of
430,000,000 quarts.
Taking the distributive trade as a whole the increased dollar revenue
would seem difficult to justify in its entirety if the earnings from other
products are to be considered in determining the consumer price of fluid
milk.
From our survey of producers' costs it would appear that the proportion
of the three cent increase passed back to the producers, viz., 2.63 cents per
quart was justified. This amount represents $1.00 per 100 lbs. of whole
milk of which 55 cents served to replace the subsidy terminated at Sep-
tember 30th, 1946 and 45 cents to offset increased farm costs. Based on
sales of 430 million quarts of fluid milk, wholemilk requirements would
aggregate 1,109 million pounds which at 45 cents per 100 lbs. would amount
to $4,990,500. This amount represents the maximum, as some allowance
should be made in respect of secondary milk purchases.
To conclude our observations on the price increase of fluid milk in
October last we give below a summarized statement showing what the
effect would have been, as closely as can be projected, had the consumer
price been advanced by 2 ¥2 cents per quart, to give a list price of 15 ¥2 cents
instead of 16 cents (where applicable throughout the Province). In the
statement we have assumed that profits from products other than fluid
milk will approximate those of 1946. No allowance has been made for any
increases in costs which may have occurred since the latter part of 1946.
APPENDIX 18
111
TABLE 15
Projected statement of net profits (before taxes) for twelve month period
allowmg for sales of 430 million quarts of fluid milk
„ , . , , o" the basis of a ISVz cent consumer price
Add^ "^t profits from all products other than fluid milk .... $ 2,382,831
Estimated profit from fluid milk based on 430 million quarts
at .21 of one cent per quart, as quoted in report, for 13
^^"^ "^llk 903 QQQ
Add: $3,285,831
Estimated additional revenue from advance in consumer price
of 21/2 cents per quart, from 13 cents to 151/^ cents
430,000,000 quarts @ 2.50 cents per quart (b) 10,750,000
Deduct: $14,035,831
Amount to be passed back to producer 2.63 cents per quart
equal to $1.00 per 100 lbs. of whole milk
430,000,000 quarts @ 2.63 cents per quart (a) 11,309,000
Adjusted net profits of distributive industry before provision
for profits taxes $ 2,726,831
It will be noted that the distributors, after paying the producers their
mcreased price, would lose $559,000 (the excess of (a) over (b) ) therebv
reducmg the profit on fluid milk from $903,000 to $344,000 This latter
would then represent but .53 of one percent of sales equal to 08 of one
cent per quart.
The adjusted net profit (before taxes) of $2,726,831 might still be con-
sidered as showmg a satisfactory return in relation to both sales and capital
employed. ^
In our opinion many concerns could well afford to reduce the present
selling price of milk by one-half cent per quart while others might lose
money and eventually be forced out of business unless there were other
compensating factors such as the industry giving effect to economies recom-
mended or outlined m this report and those embodied in the official report
of the Royal Commission on Milk. ^
Respectfully submitted,
JOHN S. ENTWISTLE
Accountant, Royal Commission on Milk,
July 26th, 1947. Province of Ontario.
112
APPENDIX 18
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APPENDIX 20
RECORD OF LICENSES IN THE MARKETS OF TORONTO, HAMILTON,
WINDSOR, OTTAWA, KIRKLAND LAKE, TIMMINS
and comments thereon
TORONTO
This record will differ from that shown in Mr. Houck's brief and from
the record given when you were in the office on January 30th. This record
covers the entire Toronto area, which is described on the record, whereas
the former record was for the area prior to the inclusion of Port Credit
and Cooksville.
A number of dairies are shown as being "taken over by" other dairies.
While our files do not give reasons or particulars we know from our
personal knowledge that in the majority of cases the dairies were in
financial difficulties. The same may be said of the term "amalgamated" —
no doubt, in most cases there was a sale of some kind made.
The dairies which disappeared were small or medium sized businesses,
except Caulfields. The dairies which took others over were small or
medium sized, except Silverwood Dairies Limited, which took over two.
There is no indication of any movement toward a monopoly situation
here by large chain dairies.
HAMILTON
There were three chain dairies — Bordens, Silverwoods and Eastern until
the year 1940 when Acme Farmers (Eastern) sold to Silverwoods. Silver-
woods also acquired during the years two other small businesses and
Bordens, one.
The other changes were between small dairies.
WINDSOR
This market has two chain dairies — Bordens and Silverwoods and in
the twelve years of control, no dairies were taken over by these two chains.
Purity Dairy is a large independent organization and took over one
small dairy.
OTTAWA
This market is peculiar for the number of producer-distributors who
have operated over the years. The explanation for this situation is, that
because of the chaotic conditions that prevailed in the early thirties, a
number of farmers living close to the City, decided to sell direct to
consumers in order to improve their financial returns and in a number of
cases gave employment to members of their families who returned to the
home farm on losing their jobs in industry.
It will be noted that with the stability of prices, as the result of control,
a number of producer-distributors discontinued the retailing of their busi-
ness and confined their business to production only. The labor difficulties
on the farms during the war also resulted in a number discontinuing,
specially in 1941, 1942 and 1943.
The two large chain dairies — Bordens and Producers (Dominion) have
not, according to this record, made any particular drive to take over other
dairies — none of the larger plants — Bordens, Producers. Clark's and Central
— have been particularly active in absorbing the smaller dairies — be they
producer-distributor or distributor.
TIMMINS
This market has never been burdened with a lot of distributors. I think
the main reason for this is that the distributors have always worked on
a comparatively narrow margin. For years the price to the producer was
$3.24 per hundred pounds on a selling price of 14c per quart to the
consumer. This is a fairly narrow spread for a northern town.
A large chain organization. Palm Dairies, operated in the market for
a few years but were unable to operate at any profit and decided to with-
draw from business. A co-operative organization, both consumer and
producer, also found difficulty in operating under the spread allowed and
[ 121 ]
122 APPENDIX 20
finally, because of financial difficulties, sold out to Northland Producers
Dairy, who within two years found themseves in a similar position and
had to sell.
The Board was requested to increase the spread allowed distributors
but in view of very efficient operation and favourable profit position of
the largest dairy in Timmins, could not justify any increase in operating
spreads.
KIRKLAND LAKE
The history of this market is somewhat similar to that of Timmins,
except that the distributors here always had a wider operating spread
than Timmins; even under this wide spread the Palm Dairies could not
make any profit and sold out.
Another organization, Eplett & Sons, who are in the Ice Cream business
in the north in a fairly large way, could not make any money in the
fluid end of its business and decided to sell out.
APPENDIX 20 123
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3 i! 3p^^ a-c >
O u O C/J
.oj.S 03^ ^ ^^t;Oo
O C 03 C ^iS-^S— (u
J-o I 1,1 ^c-are.2S«.S^2
^Q
.2 ^bioO^-3 ?^-!;i S-2-e c y
130
APPENDIX 20
CREAM ONLY
Total
Licenses
Year Issued
1934
1935
1936
1937
1938
1939
1940
,941
{942
^943
J944
I945
I946
MILK DISTRIBUTOR LICENSES— OTTAWA MARKET
and comments on those who have discontinued
60
93
95
84
70
49
43
Total
Licenses
Discon-
tinued
9
11
14
22
6
Total
Additional
Licenses Comments
33
11
40
3
36
4
30
6
26
4
22
4
21
1
Out of Business — 9
Out of Business 9
Granted extension to cover milk as we]!
as cream — transferred to regular license
holders — 2
Out of Business — 14
Out of Business — 22
Out of Business — 5
Refused — 1 — City Health authorities
cancelled local license — M.C.B. refused
issuance because dairy did not comply
with local requirements.
Out of Business — 3
Out of Business — 4
Out of Business — 6
Out of Business — 4
Out of Business — 4
Out of Business — 1
Note — Out of Business — (reasons) selling on market only; selling directly to dair>';
No cream — only license holder sold out to an existing dairv' — if so, no knowledge; All
cream only license holders were licensed as "PD".
APPENDIX 20
131
MILK DISTRIBUTOR LICENSES— TIMMINS MARKET
Year
1 C\0 A
Licenses Issued
D PD Total
1 T
Licenses
Discontinued
D PD Total Comments
Additional
Licenses
D PD Total
19^4
1935
1936
1937
1938
1939
1940
1
2 3
3 3
4 2
4 2
4 2
4 ..
i
5
6
6
6
6
4
1 PD changed to D
2 Out of Business— D.
1 3 (4) new
licenses
1 new
Nora; Korman's Dairy
1941
1942 3 .
1943 2 .
. 3
. 2
1944 2 .
1945 2 .
1946 2 .
2
2
[ 2
Definition:
took over Peter Sadino.
Palm Dairies & Workers Co-Operative of
New Ontario taken over by producers
operating under Northland Producers
Dairy.
Korman's Dairy took over Northland Producers
Dairy (under Bulk Sales Act)
Timmins Milk Marketing Area
(a) Town of Timmins
(b) Township of Tisdale
(c) Township of Deloro
(d) TowTiship of Mountjoy
132
APPENDIX 20
MILK DISTRIBUTOR LICENSES— KIRKLAND LAKE
Comments
Model Dairy taken over by Lindfors Dairy
Palm Dairies taken over by Lindfors Dairy
D. Eplett & Sons taken over by Lindfors Dairy and
Producers Dairv
Definition:
Kirkland Lake Milk Marketing A rea
The Townships of Grenfell. Eby, Teck, Otto, Lebel, Boston, Gauthier, McElroy,
McVittie, Hearst, McGarry, McFadden, which townships include among others, the
places known as: Kirkland Lake, Swastika, Larder Lake, Virgin iatown.
Total
Total
Licenses Licenses
Year
Issued
Discontinued
(all D licenses)
1934
5
1935
5
1936
4
1 M
1937
4
1938
4
1939
4
1940
3
1 P<
1941
3
1942
3
1943
2
1 S.
1944
2
1945
2
1946
2
APPENDIX 21
THE DELIVERY OF MILK IN TORONTO
Introduction
This report gives the results of a survey among Toronto housewives to
ascertain their practices and preferences in the delivery of milk. In all,
503 women were interviewed in nine wards and also in the districts of
Kingsway, Swansea, Forest Hill and Leaside. By income groups they
were divided as follows:
High income group 51
Second income group 150
Third income group 239
Low income group 63
503
Of the total number interviewed 258 had adults only (i.e. over 16 years
of age) in the family, and 245 had children. The actual interviews were
carried out by Canadian Facts Limited, whose letter is reproduced on
page 9.
The number of people in these families followed a typical distribution:
Without With
children children
No. in family
1 19
2 89
3 62 54
4 56 71
5 16 57
6 8 32
7 15
8 1 7
9 1 4
10 2 2
More than 10 3 3
Information refused 1 1
258 245
Do you have your milk delivered to your home by a dairy?
Of the 503 housewives interviewed, as many as 486 (96.6%) have their
milk delivered to their home; only 17 (3.4%) obtain their milk from a
retail store instead of from the dairy wagon. One of these was in the high
income group, 10 in the third, and 6 in the low group. The answers of
these 17 have been shown separately because many of the questions did
not apply to them. Thev follow the analysis of the answers of those who
have milk delivered to their homes.
Would you like to see home delivery discontiriued?
Of the 486, 480 said they v/ould not like home delivery discontinued.
We have taken the answers as given, but it appears that of these six who
stated they would not mind discontinuance of home delivery, only one
answered correctly; the other five showed by their other answers that they
appreciate home delivery. The one exception was a woman who said that
it was awkward to have delivery at her home as she is working during
the daytime.
Do you ever buy milk from a retail store?
Of those who normally have milk delivered to their home, 320 (65.8%)
never buy in any other way. Supplementary purchases are made at a
store by only 166. More families with children also buy at stores (40.8%)
[133]
134 APPENDIX 21
than those without children (27.87f). Only 8 make store purchases every
day. and most buy once a week or less, as the following table shows:
Frequency of huying No. vientioning
every day 8
2 or 3 times a week 23
once or twice a week 7
once a week 33
twice a month 18
once a month 34
once every two months 7
every three months , 9
twice a year 7
once a year 1
frequently 1
seldom 15
The reason most frequently given for buying at a store is that they run
short. This was mentioned by 104 women. Other reasons were:
unexpected guests 18
for special cooking 15
if miss the milkman 8
if they need more 8
get it fresh from store 4
if driver late . 2
after returning from week-end 2
Would it he possible for you to go to the store every clay for your milk?
More than half of the women said that it would be impossible for them
to go to the store every day for milk if they had to do so. As the income
group increases, the percentage saying they could not go also increases, i.e.
could not go every day
high income group
second income group
third income group
low income group
families without children
families with children
Total
The women who said they could not go to a
gave the following reasons:
Have babies or young children.
Too busy
Health reasons
Can't go out every day
Inconvenient
Can"t carry
Too old
Too far to go
Goes to work
Weather sometimes bad
Buys too much milk to carry. .
Can't walk
Unwilling
Telephones for all groceries. . . .
30
60.0
88
58.7
109
47.6
20
35.1
136
54.8
111
46.6
247
50.8
tore every day for
milk
Without
With
Children
Children
Total
49
49
21
16
37
16
9
25
14
7
21
14
7
21
9
7
16
15
1
16
7
4
11
9
9
11
7
2
9
6
2
8
6
—
6
6
6
2
—
2
APPENDIX 21 135
Without With
Children Children Total
Too "primitive" — - '^
Takes care of invalid 2 — 2
Too lazy 1 — 1
Store milk not fresh — 1 1
Wants it early in the morning — 1 1
Woiiki you have any objection to delivery of milk to your
home every second day only?
The suggestion that milk might be delivered every second day only was
objected to by 213 (43.8'7f). The number who have objections is larger
m the two lower income groups than in the two higher, and is also larger
among families with children than among those without children, i.e.
have objections: %
high income 38.0
second income 38.7
third income 45.0
low income 57.9
without children 34.5
with children 52.5
Do you consider the milk you buy better tJian that sold by other dairies?
A majority of the women think the milk they buy is better than that sold
by other dairies (251 out of 486. or 51.6%). Only in the low income group
is the percentage low, i.e.
high income 62.0
second income 51.3
third income 52.8
low income 38.6
without children 54.4
with children 48.7
Would you be content if you were compelled to buy from a single dairy,
not of your own choosing, which is gii^en the sole right
to deliver milk to your house?
More than half the women would not be content to buy from a single
dairy, not of their own choosing, if it were given the sole right to deliver
to their homes (253 out of 486, or 52.1'^r). Again, the low income group
appears to be the most particular, i.e.
would not be content: %
high income 52.0
second income 39.3
third income 55.0
low income 73.7
without children 52.8
with children 51.3
Are you buying less milk for your family since the price went up?
About one out of five families are apparently buying less milk since the
price went up: these are almost equally divided between those who ai'e
buying substantially less, and those buying slightly less. Naturally, a
larger proportion of those with lower incomes are buying less than those
with higher incomes, i.e.
are buying less rnifk: no. %
high income 7 14.0
second income 20 13.3
third income 63 27.5
low income 15 26.3
without children 43 17.3
with children 62 26.1
Total 105 21.6
136
APPENDIX 21
The answers of those buying less were as follows:
Substantially less Slightly less Not given
High income 1 4 2
Second income 9 11
Third income 28 34 1
Low income 10 4 1
Without children 16 25 2
With children 32 28 2
At What Hour of the Day Do You Like to Receive Your Milk?
Eight o'clock is the most popular hour at which those interviewed like
to receive their milk. The detailed answers were as follows:
10 a.m 39
10.30 2
11.00 28
11.30 2
Noon 16
1 p.m 2
3-4 p.m 1
6 p.m 1
Morning 19
Any time 7
No answer 7
Before
7 a.m
1
Before
8 a.m
4
Before
9 a.m
2
Before
Before
7 a.m. .
10 a.m. ...
11 a.m. ...
3
1
52
7.30
56
8.00
130
8.30 . ...
29
9.00
73
9.30
11
(answers like "between 8 and 9" have been shown as 8.30)
Answers of Those Buying Only from Stores
Of the 17 women who buy their milk only from retail stores, one buys
twice a day, 8 buy every day, and 3 every second day. Five did not say
how often they buy.
The reasons given for using a store were:
more convenient 3
avoid trouble with tickets 2
don't like people at door 1
get milk when need it 1
lives near dairy 1
prefer from store 1
milkman won't climb stairs 1
doesn't buy much 1
prefer grocer to deliver 1
Five gave no reasons.
Only 3 out of the 17 thought that their brand of milk was better than
other brands. Three also said that they were buying less milk since the
price went up; all three said "slightly less".
HOUSEWIVES— HOME INTERVIEWS
1. (a) Do you have your milk delivered to your home by a dairy?
Yes No
(b) (If YES) Would you like to see home delivery discontinued?
Yes No
2. (a) Do you ever buy milk from a retail store? Yes No
(b) (If YES) How often would you say you do this?
(c) Could you tell me why? ••••••
3. (a) Would it be possible for you to go to the store every day for
your milk? Yes No
(b) (If NO) Would you mind telling me why it isn't possible?
4. Would you have any objection to delivery of milk to your home every
second day only? Yes No
5. Do you consider the milk you buy better than that sold by other
dairies? Yes No
APPENDIX 21
137
6. Would you be content if you were compelled to buy from a single dairy,
not of your own choosing, which is given the sole right to deliver
milk to your house? Yes No
7. (a) Are you buying less milk for your family since the price went up?
Yes No
(b) (IF YES) Would you say substantially less or just slightly less?
Substantially less Slightly less
8. At what hour of the day do you like to receive your milk?
BASIC DATA: Ward or District:
Occupation of head of house:
Name: ;
Address:
City: Telephone Number:
No. in Household Income Group
Adults (over 16) A
Children: B
CANADIAN FACTS LTD.
Toronto, Ontario,
February 4, 1947.
Cockfield, Brown & Co. Ltd.,
Canada Cement Building,
Montreal, P.Q.
Attention: Mr. Henry King
Dear Mr. King:
We are very glad to outline for you the basis on which we conducted the
poll of Toronto opinion on milk distribution for you.
In the first place, the questions asked were supplied by you. We had no
part in their development, nor any knowledge of their purpose or who
among your clients might be interested in the facts and opinions gathered.
The collection of the information was our responsibility. In this part of
the project we worked entirely independently, turning over to you the
questionnaires as they were completed by our field representatives.
Each questionnaire was completed by means of a personal interview with
a housewife in her own home. The corps of representatives assigned to
conduct the interviews were selected for their experience in this particular
type of work. They, of course, had no knowledge of the clienl for whom the
work was being done.
The 500 housewives interviewed are a good cross section sample of all
Toronto housewives. This was assured by two means.
First, the 500 interviews were apportioned between the nine wards and
four contiguous municipalities in proportion to their populations. This
assured coverage of all sections of the city, each section in proper proportion
to the others.
Second, interviews were randomized to cover representative homes in
all sections of each ward or municipality.
With a smaller sampling of the city we ordinarily select homes in four
or five sections of the city in accordance with pre-determined quotas that
assure a representative coverage of the various age groups and economic
levels.
With the 500 interviews called for in this study we were able to achieve
a more widely representative cross section by the method outlined above.
However, the proportions of the actual sample do match closely the econo-
mic level quotas which we have found from long experience are typical
of Toronto.
In our opinion, therefore, you are justified in assuming that the 500
or more housewives interviewed are a reasonably representative cross
section of the community.
Yours very truly,
John F. Graydon,
President.
APPENDIX 22
COPY OF MEMORANDUM
FURNISHED COMMISSION AND DISTRIBUTORS" ASSOCIATION
BY GOVERNMENT OF NEW ZEALAND
In respect of the Wellington Area
Department of External Affairs,
Wellington, N.Z.
2nd December. 1946.
MEMORANDUM for: —
R. M. Firth, Esq.,
Official Secretary,
High Commissioner for New Zealand,
Ottawa,
CANADA.
In response to the request of the Ontario Milk Distributors' Association
for information concerning the Wellington City Milk Corporation for-
warded by you, the following data is supplied:
1. Taking one (only) recent month, the weekly average number of quarts
of milk sold equalled 414,700. Sales ai'e on the increase.
(Not including milk for cream sales.)
2. Cost of milk delivered at receiving stage of depot.
Per Gallon Per Gallon .Average B.F. Te«;t
Summer 12. 47d
( 5'^4 months > Plus cartage 1 . 46d = 13, 9,3d 4 3',
Autumn
(21/2 months; Plus cartage lo.60d
1 46d = 17 06d 4 7',
\\'inter
(4 months) Plus cartage 23.33d
1 46d = 21 79d -19',
Milk prices are fixed by the Government and the above prices are expected
to be increased by .78d. per gallon very shortly.
Note: —
(a) The foregoing producer prices includes a Government Subsidy of
2.409d. per gallon.
(b) Producer prices vary according to the butterfat content of milk.
(c) Milk is purchased on a butterfat basis together with a price per
gallon termed added value.
(d) A gallon of milk weighs 10.31 lbs.
(e) Milk is not purchased in New Zealand at a price per cwt.
S. Cost of milk for manufacturing purposes, e.g., surplus to liquid milk
requirements.
17.75d. per lb. butterfat.
plus 0.65d. per gallon of milk
plus 3.904d. per lb. butterfat Government subsidy.
Average butterfat test for year, 4.69f .
4. Wages:
Dairy (plant) employees: —
General hands, £5 13s. 2d. + 5s. extra p.m. shift.
Leading hands, £5 18s. 2d. + 5s. extra p.m. shift.
Half time extra Saturday afternoon, double time on Sunday, treble time
on Statutory holidays
Plus: —
(a) Overalls and aprons provided free.
(b) Gum boots supplied free.
[138]
i
s.
d.
6
15
3
6
14
8
6
8
11
6
17
0
7
2
10
APPENDIX 22 139
(c) Subsidy provided by City Council to employees Insurance Scheme,
also to Sick Benefit Scheme.
Under the terms of a new Award likely to be ratified by the Arbitration
Court very soon, the above rates may be increased by an average of
approximately 5s. 6d. weekly.
All employees work a 5 day week of 40 hours.
Wages:
Deli very men: —
Wages vary considerably as many different classes are at work through-
out the organization. Those engaged on distribution also vary according
to whether he is a motor driver, a cart roundsman, a motor roundsman, or
a relieving roundsman.
The gross basic rates are: —
Motor Driver
Motor Roundsman
Cart Roundsman
Relieving Roundsman 6
Relieving Motor Roundsman
Under the terms of a new Award likely to be ratified by the Abritration
Court very soon, the above rates may be increased by an average of
approximately 5s. 6d. weekly.
Overtime is paid at 1 '/o times first four hours and double time thereafter.
All employees work a 5 day week of 40 hours.
5 & 6. The Milk Department pays all general taxation in the same way as
a private Company would, except Income and Social Security Taxes, local
bodies being exempted from payments under the latter heading.
7 k 8. Depreciation:
Concrete buildings 2%
Wooden buildings 3%
Plant, depending on type of unit 2'^k% to 10%
Motor vehicle?, depending on size 10% to 20%
Carts 5%
Harness 20%
Milk cans and crates 10%
9. Cost of fuel at plant: Coal, £1 19s. per ton; Gasoline (wholesale), 2/3l2d.
per gallon.
10. Cost of carts (wagons). None have been purchased for 10 years but
the estimated cost per cart today is £140.
No V2 or 1 ton trucks are used.
This Department recently purchased a IV2 ton truck (K3 Intel-national)
for £740 plus tray £60, total £800.
11. Re personal income tax. Under present day labour shortages a good
deal of overtime is worked. Taking a large number of employees, the
average income during the latest Income Tax year was £466.
£ £ s. d;
Income Ta.x on 466
Less exemptions 400
Balance 66 at 2 6 in £ = 8. 5. 0
+ 1 5' V. (reduced from 33.1 Ij") = 1. 4. 9
9. 9. 9
Social Security Tax. £466 at 2s = 46. 12. 0
Income Tax and Social Security on
£466 for married man and two children = 56.
12. (a) White bread: S^d. for 2 lb. loaf.
(b) Sugar: 4d. a lb.
(c) Potatoes: old 2d.~2'/9d. lb.
new 3J^d.— 7d. lb.
(d) Cheese: Is. lb.
(e) Butter: Is. 6d. lb.
(fl White flour: 4s. 4d. per 25 lb. bag.
(g) Eggs: Grade .-X. ... Is. lOJ^d.— 3s. 4d. dozen.
140
APPENDIX 22
(h) Blade beef: 8d. 83^ lb.
(i) Sirloin beef: plain lOd. — lOJ^d. lb., rolled & boneless Is
(j) Bacon: Is. 6Kd. lb.
Ck) Mutton: leg lOd. lb., shoulder 7d. lb.
(1) Milk:
Id.— Is. li^d lb.
Summer Selling Period
Bottled Retail Loose Retail
Supplied by Supplied by
Department for Milk-shops
Tokens for cash only
Per quart 63^d 63^d
Per pint S^d 3Hd
Per Yi pint 2 d
Bulk Retail per gallon
3 gallons and under 10 gallons 1 /lid per gallon
10 gallons and over daily , 1 lOd per gaaon
To dairy-shops for re-sale 1 lOd per gailon
Cream; (40% Butterfat Test)
Per Pint 2/-d 2 -d
Per K Pint l/-d 1 -d
Per ]4 Pint 6d 6d
Per 4 Pints and over f per gallon) 15 -d
To Dairy-shops for re-sale 14, -gallon
Milk
Per quart
Per pint
Per l^ pint
Bulk retail prices per gallon;
3 gallons and under 10 gallons daily.
10 gallons and over daily
To Licensed Milk-shops for re-sale . . .
Crean:; (40% Butterfat Test)
Per 4 pints and over
Per Pirt
Per MFirt
Per U Pint
inter Selling Period
Bottled retail
Supplied by
Department for
Tokens
Loose retail
Supplied by
Milk-shops
for cash only
7 d
3>^d
7 d
3Hd
2 d
2/ Id
2/-d
1 lid
Bottled retail
Supplied by
Department
for coupons
15s oer gall.
2s.2d
Is.ld.
7d.
Loose Retail
Supplied by
Milk-shops
for cash
los per gall.
2s.2d.
Is.ld.
7d.
Although not requested, I give the following information: —
(a) Pasteurising costs, 2d. per gallon.
Bottling costs, 2d. per gallon.
Distribution costs (retail), 7%d. per gallon.
Distribution costs (wholesale), SV^d. per gallon.
(b) The City Council thi'ough its Milk Department has absolute control
from farm to consumer of the city milk supply. The Government
controls prices only.
(c) The Revenue of the Department is now approaching £700,000
annually.
(d) 30,000 customers are served daily.
APPENDIX 22 141
(e) The token system of payment has been in use for 24 years. Under
this system no debts are incurred. A clean sheet is shown in this
respect.
I trust the foregoing will serve a useful purpose to the Association
concerned.
Secretary of External Affairs.
Excerpt from New Zealand Royal Milk Commission — 1943 in respect of the
Wellington Area.
Present Circumstances of the Supply of Milk to the Metropolitan Area
of Wellington.
The Wellington Metropolitan Area comprises Wellington City, Lower
Hutt City, Petone Borough, Eastbourne Borovigh, Johnsonville Town
District, and some adjoining and closely-related areas. The whole area is
divided into two sub-areas, one comprising the City of Wellington and its
immediate environs from Seatoun up to Johnsonville, and the other the
flat land and surrounding hills in the Hutt Valley and the bays on the
eastern shore of the harbour. Both sub-areas are fairly widely spread.
That comprising Wellington City and its immediate environs is for the
most part hilly and is not convenient for the purposes of distribution. The
Hutt sub-area is for the most part flat and, apart from the limited popula-
tion on the hills fringing the valley and the bays, presents conditions
favourable to expeditious distribution.
Demand
Population
According to estimates published in the 1942 issue of the Year-Book the
total population of the metropolitan area on 1st April, 1941, was 160,500,
of which 36,020 persons were living in the Lower Hutt City and the
Boroughs of Petone and Eastbourne. In addition to this population the
liquid-milk industry in this centre has to supply the needs of shipping, of
men of the Armed Forces, and of children in schools outside the area which
draw milk from the area. The quantities required for shipping are con-
siderable, but neither these quantities nor those for the Armed Forces can
be exactly computed. The number of children in outside schools for
whom provision is expected is 2,907 and half a pint of milk is required
for each child on each school day.
The following figures for the whole metropolitan area taken from the
Year-Book mdicate the growth of the population: —
1911 82,800 1926 121,527
1916 95,235 1936 149,382
1921 107,488 1941 160,500
These figures show a ip.h'ly u. "form increase of approximately ^,500 per
annum over the thirty-year period. Some variation may be due t'> the
irregular development during some periods of districts just outside the
urban area and to the inclusion at other times of such districts in the area.
In estimating future requirements the continuance of this growth, with
a corresponding increase in attendance at outside schools and an increase
in shipping requirements, must be taken into consideration. The require-
ments of the Forces will ultimately drop rapidly, but against this must
be set the demand of a large body of our own Forces returning to civilian
life. And, perhaps more important than these movements, may be the
stimulus to increased consumption per head of the population imparted by
the teachings of nutritionists and the appeals of health authorities.
Present Consumption
The milk Department of the Wellington City Council has supplied a
return of milk sold by the Department year by year during the five years
ending 31st March, 1943. This return is as follows:
Year ended 31st March Milk, in Gallons Cream, in Pints
1939 2,628,953 419,257
1940 2,917,437 474,664
1941 3,063,021 481,992
1942 3,107,306 530,872
1943 3,883,638 665,145
142 APPENDIX 22
The nearby farmers have not kept accurate records of their sales, but
they supplied an estimate of the daily gallonage sold during the month of
August, 1942, at 2.986^2 gallons. This is an estimate only. Probably a
general statement that the sales average between 2,500 and 3,000 gallons
per day or between 900.000 and 1.000,000 gallons per year is the only one
that can be made with any justification. The Milk Department, however,
supplied 74.190 gallons of milk and 91.981 pints of cream to nearby farmers
during the twelve months ending 31st March, 1943, and as this is included
in the total sales of the Department only the balance of the nearby farmers'
sales is to be added to the Department's figures in arriving at the total
sales. Computing the daily sales by the Department and adding those by
the nearby farmers we have as the total average daily sales during the
twelve months under review of something over 13,000 gallons of milk
and about 2.000 pints of cream. The Hutt Valley and Bays' consumption is
distributed by vendors, producer-vendors, and the Wellington Dairy
Farmers' Association. The daily output, in gallons, by members of the
Hutt Valley and Bays' Milk Vendors Association has been returned to the
Commission as 3,371% gallons, or 1,230,688 gallons per annum. The
greater part of this is supplied by the Wellington Dairy Farmers' Co-
operative Association, Ltd., who, in addition, supply 800 gallons per day,
or 292,000 gallons per year, to shops for resale and further quantities to
camps and shipping. During the year ended 31st March. 1943, the associa-
tion supplied to the last-named two groups a total of 223,173 gallons.
Adding the quantities sold by the association to shops, shipping, and
camps to the quantities sold by the vendor members of the association,
we have the total of the sales during the year ended 31st March, 1943, of
1,745,861. or 4,783 gallons per day. The grand total for the metropolitan
area — that is, of the Wellington and Hutt Valley sub-areas combined —
when cream is computed as gallons of milk works out at over 7,500.000
gallons per annum, or over 20,548 gallons per day.
Prospective Expansion of Demand
Though complete figures showing the expansion of demand during
recent years are not available the returns from the Milk Department of the
Wellington City Council for five years and those from the Wellington Dairy
Farmers' Association for three years give an indication of the expansion of
consumption. The Department's figures are quoted above. The totals from
the Wellington Dairy Farmers' Association for the three veai's ending
31st March. 1943, are as follows: —
Year ending 31st March. 1941 1,073,567
Year ending 31st March, 1942 1.171,019
Year ending 31st March, 1943 1.365.814
As these figures, as well as those of the City Council, include the very
irregular supplies to camps the inference to be drawn from the figures
must be guarded. But, so far as the Dairy Farm^ers' Association's figures
are concerned, if the supply to shipping and camps were entirely elimi-
nated, the increases between 1941 and 1942 would be 48,260 gallons and
that between 1942 and 1943 would be 159,424. But even in this respect
the special demands of milk-bars and institutions qualifies the result.
A better guide is probably to be found in the increase in population,
both in towns and in schools, with its reaction on other mattei's such as
shipping and visitors. In this connection three factors have to be noted.
One is the dispersal of the Armed Forces at the end of the war; another
is the return to civilian life of something like 10 per cent of the population:
while the third is the stimulus to increased consumption per head of the
population. If all these factors are taken into consideration any long-term
policy must anticipate and provide for a considerable increase in the daily
demand disturbed, perhaps som.ewhat violently, during the period of
repatriation.
Organization
Features of Present Organization
The organization of the Milk-supply to Wellington is unique in several
important features.
APPENDIX 22
143
Municipal Milk Department and Wellington Dairy Farmers' Association. —
The first feature is the co-existence of and co-operation between a Muni-
cipal Milk Department and a strong organization of suppliers. Among
treating and vending houses in New Zealand the Milk Department of the
Wellington City Council is conspicuous in respect of volume of business,
the standard of production, and completeness of organization. Among
organizations of suppliers the Wellington Dairy Farmers' Co-operative
Association, Ltd., is conspicuous in its comprehensiveness of scope, its
persistent and successful endeavour to maintain a high standard, and
its capacity to conduct successfully the affairs of a large group of suppliers.
In co-operation the Milk Department and the Farmers' Association have
controlled the major part of the liquid-milk industry of the metropolitan
area of Wellington for nearly a quarter of a century. Their ability to meet
and negotiate has ensured the smooth and efficient working of the industry
during that period. By processes of negotiation and arbitration a higher
price per gallon has been secured for the producer than has been secured
in any other area and a higher-quality milk has been delivered. The
growth of the population and the increasing pressure on the sources of
supply, is developing a new situation, but it is reasonable to hope that, with
certain necessary modifications in organization and relationship, the co-
operation hitherto displayed will continue to exercise a guiding and control-
ling influence over the developing industry to the advantage of all con-
cerned.
Contracts for the supply of milk have been made from time to time
between the Wellington City Council and the Wellington Dairy Farmers'
Association, Ltd. Features of these contracts that have endured for some
time are:
(1) Subject to certain qualifications, the association has a right to supply
50,000 lb. of milk per day from the 30-mile area;
(2) If during the summer and autumn periods the association cannot
supply the specified quantity from the 30-mile area, the Council
has the right to obtain the shortage from its Rahui Factory, but if
it cannot do this the association has the right to supply it from
outside the 30-mile area;
(3) If during the winter period the Council requires more than 50.000 lb.
of milk per day, it is to give the association the opportunity to
supply from the area extending beyond the 30-mile limit
up to Levin one-half of its requirements up to 1,700 gallons
per day, and two-thirds of its requirements in excess of an additional
3,400 gallons per day.
The specified 50,000 lb. of milk per day has been included in successive
contracts for a number of years, though it is- understood that an increase
to 60,000 lb. in the next contract is contemplated. The continuance of this
fixed amount during a period of continuous growth in the population has
meant that the contractual rights of the association has affected a decreasing
proportion of the city's total consumption. This has not in practice greatly
affected the Dairy Farmers' Association, since the orders have exceeded
the prescribed amount and the increasing consumption in the Hutt Valley
has absorbed a considerable portion of the production of the members
of the association. Disputed matters, such as price, are settled by arbitration.
Relation of Vendors in Hutt Valley to Wellington Dairy Farmers' Associa-
tion.— The second feature of the organization of the supply to the metro-
politan area is the relation of the Dairy Farmers' Association to the vendors
in the Hutt Valley and the cordial co-operation of these two bodies. This
has had a double effect. It has given the Hutt Valley Vendors and their
consumers a supply assured by a powerful producers' association, and it
has given to the members of the association an assured and growing market
for which they were able to organize their resources.
Limit of Contracts. — The policy of the Milk Department of the Wellington
City Council appears to be to contract for quantities considerably less than
its anticipated requirements and to arrange for additional supplies in the
period of the year in which they are called for. It is not suggested that
it does not estimate its requirements or that such estimates have been
faulty. Nor is it suggested that it overlooks the question of the extent of
144 APPENDIX 22
the resources on which it can rely. The feature is that provision by forward
contract is made for part only of its needs and that for the remaining part
reliance is placed on its ability to call upon other resources as the need
arises. Complaints were made by farmers that the Council would not enter
into contracts for a term sufficiently long to justify them in organizing
their farm economy for the supply of liquid milk to the area. It certainly
appears that many farmers who could undertake city supply have been
unwilling to do so because of the uncertainty attaching to the continuance
of the demand. It is understood that the Department on one occasion
suffered by over-commitment and that it has been careful to avoid a
repetition of that experience. It has been urged that a body such as a
City Council cannot commit itself with the freedom of a proprietary concern.
If this means that a municipality cannot fairly estimate its requirements in
respect of so vital a commodity as liquid milk and make contractual agree-
ments for ensuring adequate supplies for the community, then it would
be at a serious disadvantage in competition with private enterprise. But
the Commission is not satisfied that any such limitation necessarily attaches
to a public service of this nature.
When the Milk Department of the City Council commenced its operations
in 1919 the liquid-milk supply to Wellington had sunk to a very low level.
The Department rapidy improved the position and after taking over
retail delivery in 1922 it raised the service to a standard unexcelled in New
Zealand and that challenges comparison by any other system in any part
of the world. But it is impossible to contemplate with equanimity the
introduction of large supplies from outside souixes. And it was profoundly
disturbing to hear resort to such supplies approved as a permanent feature
of the supply policy of the Council. There does not seem to be any valid
reason why the Council should not fairly estimate the whole of its require-
ments with a reasonable degree of accuracy. The present daily demand
is known to be approximately 12,700 gallons. Yet the Milk Department
has made forward contracts for next winter's supply amounting to 9,000
gallons per day only. To make contracts that would bind an organization
or organizations of supply to have the estimated quantities with a surplus
of, say, 10 per cent., available at all times is surely reasonable. With such
contracts the supply organization or organizations could organize its or
their resources and make its or their plans in such a way as to protect
producer members and give reasonable stability to the industry and
assurance to the consumers. Any treating and vending body that proceeded
on these lines would be entitled to protection in respect of violent fluctua-
tions occasioned by the prosecution of public policy, such as the movement
of Armed Forces, and there seems no reason why that protection should
not be afforded. In Parts II and III of this report the Commission has
made recommendations that it hopes, if adopted, will assist in overcoming
the difficulties and ensuring adequate supplies of milk of high standard
at reasonable prices. These difficulties must be overcome or the risk
of more severe shortage and more extensive reliance upon unsatisfactory
supplies must sooner or later be the outcome.
Supply — Natural Conditions
The source of supply for the metropolitan area is unique. It is divisible
into several supply areas. First, there is the area within two miles of the
city's boundary. This is occupied by the farms of producer-vendor whose
function and right is recognized by the Wellington City Milk Supply Act,
1919, and its amendments. This area is very broken and the soil is mostly
of poor quality. It has the advantage of immediate proximity to the
area of distribution, and this advantage is of importance to the small man
who both produces and vends his own milk and is able to eliminate most of
the cost incident to collection from a distance. This area produced some-
thing in the vicinity of 900,000 gallons of milk last year, or a daily average
approaching 2,500 gallons. The next area is that outside the 2-mile area
but within a radius of 30 miles of the city and comprises mainly the land in
the Hutt Valley and adjacent valleys, the slopes surrounding these valleys
and those adjoining the 2-mile area, and land extending up the west coast
as far as Paraparaumu. The milk drawn from this area for the City of
Wellington and its immediate environs is drawn through the Wellington
Dairy Farmers' Co-operative Milk Supply Association, Ltd., while that
supplied to the Hutt Valley and associated district is drawn from the
APPENDIX 22 145
same association and from producer-vendors. Though the land in this
area cannot be classed as high-class dairying country it includes pockets
of good land and produced during the year ending 31st March, 1943, some
1,851,313 gallons, or an average of 5,072 gallons per day. The third area
extends up the west coast as far north as Levin, which is 59 miles distant
from Wellington, and includes, in addition to Levin, the districts of Packa-
kariki, Paraparaumu, Waikanae, Te Horo, Manakau, Obau, and Otaki.
The portion of this area that lies nearest to Wellington is hilly and generally
of poor quality. As the area extends farther north it includes increasing
quantities of flat land of good quality. Outside these normal areas of supply
are other territories stretching to Bunnythorpe on the one hand and
Pahiatua on the other, from which the metropolitan area has drawn
emergency supplies.
Cows
Within the three areas described there were, when the 1940-41 statistics
were compiled, 47,534 cows. But the number of dairies registered within
the territory for town milk-supply in the five years from 1939 to 1943
inclusive, which includes the farm dairies from which the Hutt Valley
supply is drawn, is given by the Department of Agriculture as follows:
Year Registered Dairies. Number of Cows Milked.
1939 459 16,956
1940 494 17,312
1941 500 18,445
1942 509 19,554
1943 502 19,086
A comment on the return conveys the information that not all the
registered dairies supply milk to the Wellington City Council, but that fully
75 per cent, of the total are constant suppliers to the city. During the
year ended 31st March, 1943, 13,922 gallons of milk were purchased from
Shannon, and during the present winter season considerable Quantities have
been drawn from suppliers holding temporary licenses only. These licensees
were scattered over a wide area. There were twenty-six at Levin, fifteen at
Shannon, five at Tokomaru, seven at Linton, forty-eight at Bunnythorpe,
and, as commented in the official return made to the Commission, in addi-
tion to these, Glaxo Laboratories have been receiving for transport to
Wellington a considerable quantity of milk from unregistered suppliers.
It is not possible in the case of Wellington to show the monthly variations
in the total supplies to the whole metropolitan area as, with the assistance
of the returns kept by the Metropolitan Milk Council, it was possible in
the case of Auckland. A reliable guide to the position may be obtained
from the fact that in 1942. while in the summer supplies from the 30-mile
area were sufficient, in the winter months of May, June, and July the
Milk Department obtained from the 30-mile area a daily average of 3,278
gallons and from outside that area a daily average of 7,073 gallons per
day. A further indication of the trend may be found in the very large
quantities of milk that since 31st March last have been obtained from
factories outside the three areas of supply.
Balancing-station
A third feature of the organization has been the control and operation by
the City Council of a factory at Rahui as a balancing station. This is
owned and operated in accordance with an agreement made between the
City Council and the Rahui Suppliers Society, Incorporated. Agreements
pursuant to this agreement are made with the individual suppliers. Under
this agreement the Council augments its supplies and uses any excess for
manufacturing purposes.
Seasonal or Level Supply
It is questionable whether an attempt to maintain an all-the-year-round
level supply in any of the supply areas would at present be successful, or.
if successful, would be economical. As already indicated, the greater part
of the land in the 30-mile area is not of high fertility and winter feed is
expensive. Much of the land running northward from the 30-mile limit
up to Levin and Shannon is of greater productive capacity. But Levin is
146 APPENDIX 22
59 miles from Wellington and it is doubtful whether a well-adjusted summer
price would be an incentive to the farmers to send milk to the city in the
summertime rather than deliver it to the factory. The winter price,
however, may well prove an incentive to many farmers in that area to
develop winter production and so meet a real need of the city with appre-
ciable advantage to themselves. In this way summer production in the
30-mile area and winter production farther north by farmers with dairies
that qualify them to hold permanent licenses for town milk-supply would
together supply all-the-year-round wholesome milk that could be subject
to the highest recognized degree of control designed to safeguard quality
and standard. But such a supply requires organization and suitable
contracts.
Shortage of Supply
The supply to schools was suspended for three weeks last winter. This
year the Milk Department imported from factory suppliers outside the
normal areas of supply quantities in excess of 2,700 gallons a day, and
there was still a daily shortage of 2,500 gallons. As a result of this shortage
milk-supplies to school-children were rationed in February and March
and. except for a partial supply to children at kindergarten, have since been
entirely cut off. Supplies to the Armed Forces and to milk-shops and milk-
bars have also been rationed. The milk from outside suppliers has been
brought from factories as far afield as Bunnythorpe and Pahiatua.
As in other areas, so in Wellington war conditions have created special
difficulties. It has increased the demand, and the increase has been irregular
and has fluctuated severely. It has added to the difficulties of production
by causing a reduction in the fertilizer available and a serious shortage of
labour. Wellington has not suffered as Auckland has suffered from a
prolonged drought. The difficulties are real. But in the opinion of the
Commission they are not due solely to war condition,s. The population
has been increasing steadily. A scheme to supply milk for school-children
has been developed and put into operation. The value of milk as an article
of diet has been urged and is likely to have appreciable effect. Even had
there not been an outbreak of war a crisis in the milk industry seems to
have been likely. In any case, these difficulties for the current year ought
to have been foreseen. The increased demand and the greater difficulty
in production have been growing for several years and are still pi-esent.
Their continuance must be expected and provision made accordingly. In
the opinion of the Commission the policy of the Milk Department of the
City Council is responsible in no small degree for the shortage. The cows
are in the fields and a source of supply more than sufficient to meet all
the needs of the area is available within reasonable distance of Wellington.
But it cannot be expected that it will be forthcoming unless the dairy-
farmer has the assurance that can come only from contracts covering
aopropriate periods. The regular suppliers at Rahui complain that the
City Council persists in refusing to make contracts covering its real
recuirements.
The worst feature of the situation, in the opinion of the Commission, is not
the shortage, though that is serious enough, but the resort to sources of
supply bevond the areas in which standards for citv milk-production have
been established.
Methods of Production
In the_ WeUington supply areas Jersey and Jersey crossbreds predomi-
nate. This is due no doubt to the fact that milk is purchased on the basis
of its butterfat content.
There is no .systematic attention to the elimination of T.B. and other
bovine diseases. A limited test was made when it was required that the
raw milk supplied in a military camp should be drawn only from T.B.
tested herds, and, as noted later, this showed a percentage of reaction of
5.4 per cent.
The problem of replacement of stock is as urgent in this as in other
areas. As elsewhere, the mischief consequent upon purchase from sale-
yards is recognized, but the urge to keep on the farm only cows that are
in or about to come into profit checks the development of breeding one's own
replacements, or of limiting purchases to those from well-known and high-
standard herds.
APPENDIX 22 147
The problem of winter feeding is more acute in this area than it is in
Auckland and Christchurch, owing to the low fertility of much of the soil.
Winter feed must be purchased at considerable expense, and this inevitably
checks winter milking.
Farm Dairies
The Commission did not obtain adequate fii'st-hand information of the
condition of the farm dairies in the area. One difficulty mentioned in
evidence that has to be faced is that of providing satisfactory cooling
arrangements. In the summer period the water available is not of a
low-enough temperature, and the provision of refrigerating-plant and cool
storage must ultimately be insisted upon as a necessary part of the
equipment of every dairy used for town milk-supply in this area.
Standard of Supply
In spite of difficulties that have had to be overcome, the milk supplied
to the Milk Department of the Wellington City Council is of a uniformly
high standard. Tests made by the Milk Department for the year ending
30th June, 1942, on samples taken day by day on all milk brought in fi-om
farm dairies show the following results: —
Percentage of non-compliance —
Reductase test 1.422 per cent.
Sediment 0.12 percent.
Added water 0.002 per cent.
Tests for other abnormal conditions .... 0.011 per cent.
Plate count average 92,000
These results compare favourably with comparable tests made on
samples of milk in all the other areas. The system of tests and grading and
of payment according to standard adopted by the City Council and the
full co-operation of the Wellington Dairy Farmers' Co-operative Associa-
tion. Ltd., have contributed to this result.
The Commission has been informed that the emergency supplies brought
from the factory suppliers in outside districts have proved to be reasonably
good. In general this appears to be true; but it is also true that a bulk
supply from Bunnythorpe comprising the produce of a considerable
number of dairy-farms was subject to the reductase test and that it stood
under the test for five hours only. This must be regarded as very far from
satisfactory for a bulk supply in mid-winter.
Price to Producers
The price to be paid to the Wellington Dairy Farmers' Co-operative
Association, Ltd., and the price to be paid to the Rahui suppliers is based
mainly on the butterfat content of the milk, and the effect" of the agree-
ments entered into in each case is to adopt an adjusted average for the
guaranteed price for butter and cheese and to increase that by an amount
designated the "added value." This added value is obviously intended to
compensate the producer for the extra cost incurred by him over that that
he would incur in ordinary seasonal factory production. The prices paid
to the producer are indicated in the following table supplied by the Milk
Department of the Council. Butterfat rates are calculated at 17.25d. per
pound butterfat for the summer and autumn periods, but at ]7.25d. plus
85 per cent for the winter period: —
Period
16th .^.ugust to 31st January ...
1st February to 15th April
16th April to 15th August
Weighted averages 4.59 10.53 3.33 13 86
Collection
The milk sold by the nearby fai'mers is brought into town and vended
by the farmers themselves. The milk drawn by the Milk Department from
Average
Butterfat
Butterfat
Value per
Added
Test
Gallon
\'alue
Total
Per Cent.
d.
d.
d.
4.32
7.67
2.87
10.54
4.74
8.42
4.50
12.92
4.89
16.06
3.25
19.31
148 APPENLIX 22
the 30-mile ai'ea is brought in by the Department, which lets contracts for
the purpose. The milk is picked up generally at the farm-gate, but in cases
in which the dairy-farm is off the main road the milk is brought by the
farmer to a point of collection. The milk is placed on stands at the farm-
gate or roadside, and these stands are supposed to be covered, but this
provision appears to be neglected in many, if not in most, cases. The
collecting vehicles are required to have suitable covering from the 1st
October to the 30th April in each annual period so as to protect the milk
from injury by the sun's rays. When miik is required from outside the
■30-mile area it is carted to the station by the suppliers and brought into
the city by train. Under their contract either party — that is, the producer
or the Milk Department — may call for double daily delivery for the period
from 1st November to 30th April, but the producer's right to call for
delivery twice a day is contingent on evidence being available that the
standard of the milk is suffering by the delay.
In the Hutt Valley the producer-vendors convey the milk they vend
into the zoned area and the quantities supplied by the Wellington Dairy
Farmers' Co-operative Association, Ltd., are collected by the Association
from the individual farmers and delivered at the vendor's premises. The
quantities supplied to milk-shops and camps is also collected and delivered
by the association. The milk is collected once daily after the evening's
milking. This milk is delivered in cans, but the separation and identity of
supplies from different farms is not maintained in all cases, and the
Department of Health states that in many instances it is unable to trace the
supply back to its source.
The cost of collection by the Municipal Milk Department is 1.46d. per
gallon, and the comparable cost throughout the other areas varies from
0.75d. to 1.126d. The cost to vendors of raw milk and the relevant share of
the cost of producer-vendors must vary considerably.
Treatment
The most distinctive feature of the supply of milk to the Metropolitan
Area of Wellington is that approximately 80 per cent of the milk supplied
to Wellington — that is, to that portion of the metropolitan area excluding
the Hutt — is handled by the Milk Department of the City Coimcil. Of this
amount, a quantity comprising between 74,000 and 75,000 gallons of milk and
between 11,000 and 12,000 gallons of cream are supplied by the Department
to forty-eight nearby farmers in the period of shortage. Three of these
nearby farmers received in the year ending 31st March. 1943, 6,487 gallons
of raw milk and the other forty-five received 67,703 gallons of pasteurized
milk. As all the milk that the Department vends is pasteurized, very little
short of 80 per cent of the liquid milk and cream passing into use in the
Wellington City area is pasteurized. All the milk that is retailed by the
Department and all that that is supplied to the schools is bottled, while
the wholesale supplies and the supplies to the Armed Forces are delivered
loose. The testing, pasteurizing, and bottling at the milk depot is excellent,
and the system adopted has undoubtedly attained the best results in New
Zealand.
The Milk Department of the City Council maintains a laboratory that
is under the control of an analyst whose appointment was approved by
the Health Department. Each day every supplier's milk is weighed on
arrival at the depot and a sample is taken for testing. Part of every
sample is subject to the reductase test, and for the year ending 30th June,
1942, 27,444 such tests were made and non-compliance with the statutory
standard was established in only 1.422 per cent of cases. Altogether, 9,914
tests were made for butterfat content in milk and 1,398 for butterfat
content in cream and 97 for total solids, and each of these tests was made
on a composite sample of separate samples taken each day for ten days.
The average butterfat content for the year was 4.486 per cent and of
solids not fat 8.84 per cent. In the same period 4.942 tests were made
for sediment and 1,716 for added water. There were 66 micro examinations,
6,038 agar plate counts, and 1,507 for B. Coli, 2,105 for fermentations,
448 for pH. values, and 202 phosphatase tests. Sediment was found in
0.12 per cent of the tests and added water in 0.002 per cent. Other
abnormal conditions were found to exist in 0.011 per cent. An important
feature of the tests applied to the suppliers' milk is that a financial loss
is immediately attached to any milk found to be below standard. If the
APPENDIX 22 149
milk falls below the standard of four hours under the reductase test it is
graded as second class. Once the milk of a supplier has been graded as
second class succeeding supplies are not again bulked until after the
result of the test has been ascertained. Then if it proves still to be second
grade it is separated and the supplier is paid for it at Id. below the rate
allowed by the Council in respect of butterfat content. If the milk con-
tinues second grade until it has been separated on three days in succession,
further supplies are condemned until the trouble is remedied, and the
supplier receives no payment but is charged for cartage from the farm to
the depot. If a supply does not stand up to the test for more than fifty
minutes it is condemned at once and the supplier receives no payment but
is charged for cartage until the standard of four hours is restored. This
system of testing, grading, and payment has an immediate and direct effect
on the quality of the supply.
Both pasteurizing and bottling are carried through under good conditions.
After weighing, the milk is cooled to 38° F. It then flows into glass-lined
insulated storage tanks. It is then pasteurized, filtered, and chilled in a
unified milk-treatment machine. The bottles are machine cleansed, steri-
lized, filled, and capped. Every care is taken to avoid danger of con-
tamination of the milk after pasteurizing and the bottles after sterilizing.
There is no exposure to the air after the treatment of the milk or the
sterilizing of the bottles until the point at which the milk enters the
bottles; and filling and capping are carried out automatically by the same
machine and as part of one process. All milk after pasteurizing and
bottling is held in a refrigerated room until loaded for delivery. It should
be stated that tests taken by the Health Department confirm the results
found by the Milk Department and, further, that of the 2,215 samples taken
in 1942 from all vendors only 75, or 3.5 per cent, failed to comply with the
standards set by the Food and Drugs Act, while none of the samples taken
from the Council's delivery carts were found to be at fault.
Milk distributed in the Hutt Valley is not pasteurized and none is
bottled. This applies to the milk distributed to householders and to that
sold in wholesale quantities and also to that supplied to the Armed Forces
and to shipping. All the milk supplied to the Armed Forces is drawn
from cows in T.B. tested herds. When the test was carried out it showed
5.4 per cent of reactors. This is very low compared with overseas ex-
perience, but it is still appreciable and gives emphasis to the recommenda-
tion that milk ought not to be distributed raw unless it is drawn from T.B.
tested cows. Generally, the tests taken by the Health Department show
that the butterfat content of the milk is satisfactory. Tests taken by the
Wellington Dairy Farmers' Co-operative Association, Ltd., of their own
milk shows 4.6 per cent butterfat. The standard in other respects is also
high. The average tests of samples taken by the Health Department
throughout the three central health districts other than Wellington showed
failure to comply with statutory standards in 11.4 per cent of samples,
while the percentage taken on the rounds in the Hutt Valley was 8.6 per
cent only. The Wellington Dairy Farmers' Co-operative Association, Ltd.,
carry out daily tests on the milk collected by it, and this gives effective
control over the standard of the milk. A recent communication from the
Health Department directed attention to unsatisfactory features at the
Wellington Dairy Farmers' Co-operative Association, Ltd.'s depot at the
Lower Hutt and recommended that certain improvements in respect of
sterilization and other matters be effected. The Commission was assured
that the recommendations of the Department in respect of sterilization were
receiving immediate attention.
It is necessary to refer again to the influence of the purchase of large
quantities of milk from suppliers to butter and cheese factories outside the
regular supply area. Under the administration of the Department of
Agriculture and of the Department of Health control over the conditions
under which town milk is produced has been effectively exercised and
progressive improvement in these conditions has been secured. Use of
emergency supplies as a common feature of town supply tends to break
down that control and to lower the standard attained. It appears to be
the case that the supplies purchased from outside sources in the winter
of 1943 by the Wellington City Council was of a fairly good standard for
milk so derived, but it was not up to the controlled standards, and the
ultimate effect of dependence on such supplies must be such as to break
down control and generally to lower the standard. In the opinion of the
150 APPENDIX 22
Commission, such dependence must be regarded as a proof of failure to
organize the city milk-supply effectively and ought not to be tolerated.
The cost of the Municipal Milk Department for pasteurization is 2.16d. per
gallon and for bottling 2.07d. per gallon. The comparable cost in other
areas ranges from 0.99d. to 1.87d. per gallon for treatment and from 2.25d.
to 3.32d. for bottling.
Distrihution
Distributors
In Wellington milk and cream are distributed by the Milk Department
of the Wellington City Council and by the nearby farmers. There are
ninety-one shop dairies in the city. In the Hutt Valley and eastern bays
it is distributed by vendors and producer-vendors and by shop dairies. In
Wellington there are forty-five producer-vendors and in the Hutt Valley
and bays district there are twelve producer-vendors and twenty vendors.
The quantities of milk delivered by these distributors is indicated by the
following returns for the year ending 31st March, 1943:
Milk Department 3,883,638 gallons milk, 665,145 pints
cream.
Nearby farmers Total sales approximately 950,000
gallons, including 74,190 gallons milk
and 91.981 pints cream purchased
from the Wellington City Council.
Hutt Valley vendors and
producer-vendors 1,230,688 gallons.
Wellington Dairy Farmers'
Co-operative Association, Ltd To milk-shops, shipping, and Armed
Forces, 515,173 gallons.
Classes of Purchasers
As is the case in other areas, the milk supplied in Wellington is divided
up between various classes, including retail purchasers such as house-
holders; wholeale purchasers, including restaurants, hotels, milk-bars, milk-
shops, &c,; purchasers under special contract, including hospitals and other
institutions, shipping companies, and Armed Forces. Sufficient information
is not available to enable us to give particulars of the amounts distributed
to each of the constituent groups, but the following return from the Milk
Department of the City Council indicates the general grouping and the
prices charged so far as their supplies are concerned:
Bottled milk (retail 1
1940-41
1.994,141
808.908
259,972
481,992
90,456
1941-42
2.068.475
788,025
250,806
530,872
99,969
1942-43
2,277,369
Bulk milk ...
1.345,788
School milk
186.291
Pints of cream
Ice-cream mix ( 1 gallon milk for 3
gallons mixture i
665.145
108.452
Prices
The prices charged were as follows:
Retail (bottled), average for 1943 27.796d. per gallon
Wholesale 5d. per gallon below retail
To regular purchasers of 250 gallons or more per month a rebate of IVzd
per gallon is allowed
Hospitals )
School milk ) Special contract prices.
Armed Forces )
Zoning
Owing to the fact that so large a proportion of the milk is distributed by
the one large vendor the Wellington area was fairly effectively zoned betoie
the system of zoning was officially adopted. The nearby farmers were
zoned in 1942 and the Hutt Valley vendors in 1940. A certain amount ot
duplication of travel between the Milk Department and individual venaois
APPENDIX 22 151
is allowed so as to ensure to purchasers an opportunity to purchase either
raw or pasteurized milk. As in other areas, considerable economies have
been effected by the adoption of zoning.
Methods of Delivery
The Wellington City Council employs forty-three horsedrawn and eleven
motor-driven vehicles on retail delivery rounds. It has four motor-vans
employed on wholesale delivery and twenty-one other motor-vehicles used
for feeder services, delivery to schools, and for collection from trains, &c.
Of the forty-eight producer-vendors some use light vans on delivery. A
number of them use private cars adapted for the purpose. In the Hutt Valley
delivery motor-vehicles are used by twenty-two distributors, horse and
cart transport by four, and other methods by six. It may be said that
generally the vehicles and method are well up to the standard of delivery
established in New Zealand, but no person watching the delivery in very
hot and dusty or in very wet weather and noticing the uncovered condition
of the vehicles would be inclined to approve it as ideal.
The roundsmen employed by the Wellington City Council now work
46i'2 hours per week; they start at 3 a.m. in summer and at 6 a.m. in
winter; they travel on their rounds an average of twelve miles; they occupy
seven hours on a round; and they deliver on an average 120 gallons per
day per round. This high gallonage per day may be contrasted with the
delivery at Auckland where the roundsmen deliver milk for 41/2 hours per
day only and where each roundsman has to handle both bottled and loose
milk. The computed cost of distribution by the Milk Department is 6.43d.
per gallon, as compared with from 7.65d. to 10.42d. by companies in other
areas.
The forty-eight nearby farmers live close to the city and transport the
milk they produce straight on to the round. As their average daily delivery
is over 60 gallons it is doubtful whether any appreciable economy could
be effected by any further rationalization.
In the Hutt Valley there are twelve producer-vendors. Some of them
travel considerable distances to and from their rounds. The following
examples illustrate the position:
One producer-vendor travels 40 miles to deliver 62 gallons. A second
producer-vendor travels 30 miles to deliver 69^2 gallons. A third producer
vendor travels 20 miles to deliver 54 gallons.
These producer- vendors do not produce all the milk they deliver, but
purchase portion of their milk from the Wellington Dairy Farmers'
Co-operative Association. Ltd.
The twenty-raw-milk vendors — that is, vendors other than producer-
vendors — in the Hutt Valley purchase the milk they distribute from the
Wellington Dairy Farmers' Co-operative Association, Ltd., and as it is
delivered to their premises there is no wastage in collection. Some of the
premises however, are situated at considerable distances from the rounds.
One vendor travels 15 miles to deliver 86^2 gallons, while another travels
43 miles to deliver 150 galons.
Two features of the Wellington system of distribution are unique. Con-
sumers are required to pay for their own bottles and payment for bottled
milk is made by tokens. The wastage of bottles is still heavy, but the
liability on the consumer acts as an incentive to the exercise of care and
saves the vendor considerable expense. It has the merit that the careless
bear the whole loss consequent on their carelessness and the careful
consumer is not called upon to share that loss. Payment by tokens saves
the time of the roundsman, both on his rounds and when making his returns.
It also saves a considerable amount of labour in the office, enabling the
staff to be much smaller than is customary in businesses of a comparable
size, and it eliminates bad debts. The tokens are sold by retail agencies,
to whom the generous allowance of 2^ per cent, on all tokens sold is
allowed.
APPENDIX 23
ROYAL COMMISSION ON MILK
INDEX TO ACCOUNTANTS' REPORT
SURVEY OF CREAMERY OPERATIONS
LOCATED IN THE PROVINCE OF ONTARIO
Related Related
exhibit table Description Page number
Assignment, approach and procedure 153
1 Industry background 153
Approach and procedure 154
Review and tabulation of financial statements showing
overall operating results 154
Observations regarding financial statements and ques-
tionnaires 155
A 2 Overall operating results for the fiscal year next preceding
October 1st. 1946 155
B Classification of businesses by sales volume 156
3 Operating losses of individual businesses 156
4-5 BreakdowTi of sales revenue 157
6 Costs and profit margins — creamery butter for the fiscal
year next preceding October 1st, 1946 158
Financial position 159
Selling prices — creamery butter 160
Diversification of product 161
Price spreads — creamery butter 161
Sales outlets ^ 161
Wage rates and labour costs 162
Production capacity 162
Trend of sales and net profits 1940-1945 inclusive 162
Overall earnings 1946 162
Outlook for 1947 163
Observations and conclusions 163
Possible increases in sales revenue 163
Possible savings and economies 163
Statistical data ....'. 164
Classification as creameries 164
Changes in ownership 165
Marketing and merchandising 165
General 195
INDEX TO EXHIBITS
A Recapitulation by areas of data extracted from financial
statements submitted by 142 creameries
B Tabulation by areas of sales groupings of 142 creameries
(The above exhibits relate to the fiscal vear next preceding
October 1st, 1946)
The Honourable Justice Dalton Wells,
Commissioner,
Royal Commission on Milk.
Accountants' Report
Survey of creamery operations
Located in the Province of Ontario
Sir:
We have completed our survey on the above subject and now have the
pleasure to submit our report thereon.
During the time this survey was in progress certain price control measures
were relaxed, certain subsidies terminated and appreciable price increases
authorized, all affecting the relative positions of the producers and process-
[152]
APPENDIX 23
153
ors as well as the profit margins of various products, particularly creamery
butter, cheese and evaporated milk.
The effect of these measures on the operating results of the creamery
industry should be favourable but it cannot be accurately determined until
a sufficient period of time has elapsed to permit of reliable data being
assembled.
Assignment, approach and procedure
Having regard to the provisions of the Order-in-Council dated October
1st, 1946, and in accordance with your subsequent instructions, we were
required to investigate and report on the operations of creameries located
in the Province of Ontario with particular regard to costs, prices, price
spreads, methods of financing, and methods of management.
Such a comprehensive survey required preliminary planning, and it is
thought that reference to a few of the more important points, which came
to our notice, relating to the creamery industry as a whole, might be of
assistance in arriving at a proper assessment of this report, and facilitate
your final conclusions.
Industry background:
According to information furnished us by the Ontario Creamery Associa-
tion, there are approximately 279 licensed creameries operating in the
Province of Ontario of which 220 are members of the trade organization
known as the Ontario Creamery Association. Of these, only 47 concentrate
on the production of creamery butter, the remaining 232 concerns engaging
in the processing and distribution of fluid milk and cream, cheese, ice
cream, powdered milk and other milk products. Some also trade in poultry,
eggs, and other produce.
A number of creameries are operated as cooperative businesses, while
others are controlled or owned by ice cream and chocolate manufacturers,
distributors of fluid milk and dairy products, packing houses, and pro-
cessors of canned foods but the majority are operated either as proprietory
businesses or partnerships, primarily for the processing and sale of creamery
butter to meet domestic consumer requirements.
The peak in creamery butter production was reached in 1939 when 88
million pounds were produced in Ontario. Since then there has been a
progressive decline, 1946 production representing but 79% of that for 1939.
Production of creamery butter in the year 1946 totalled 68,785,800 pounds,
a reduction of 11.2% from 1945, and accounted for 36.92% of the total
estimated whole milk production of the Province, aggregating 4,361,584,600
pounds. In this regard, the particulars shown in table 1, which follows,
may be of interest:
TABLE I
Summary of allocation of estimated whole milk
Production in the province of Ontario
for the year 1946
1946
Estimated 1945
pounds of % of % of
Production whole milk total total
Creamery Butter 68,785.800 lbs. 1.610.275,600 36.92 38.47
Factory Cheese 91,978,000 lbs. 1,030,153,600 23.62 26.94
Fluid Milk 467,736,000 qts. 1 ,206,758,900 27 .67 23 . 69
Fluid Cream 13,519,000 qts. 148,709.000 3.41 2.89
Condensed Whole Milk 14,765,700 lbs. 33,665,800 .77 .77
Evaporated Milk 98,063,700 lbs. 215.740,100 4.95 4.83
Powdered Whole Milk 14,535,200 lbs. 116,281,600 2.66 2.41
4,361,584,600 100.00 100.00
Taking an average wholesale price of 39c per pound, a total dollar volume
for 1946 of approximately twenty-seven million dollars is arrived at for
creamery butter alone. Statistics show that for the year 1946, 4,500,400
pounds of butter were exported from Canada at an average price of 44.51
154 APPENDIX 23
cents per pound for a total of $2,003,302 as against 5.497,900 pounds in 1945
but there are no official statistics maintained by either the Dominion or
Provincial authorities which show the proportion of such exports produced
in the Province of Ontario. The figures shown in this report therefore
relate to both domestic and export sales.
For the year 1946 creamery butter production for Ontario approximated
25% of the total for the entire Dominion.
Geographically, the bulk of the creamery industry is located in that
section of the Province west of Toronto. A number are located in the
eastern portion of the Province, in the Ottawa Valley and St. Lawrence
River sectors, and a few in the central and northern parts of the Province.
The exact number of personnel employed by, or connected with, the
industry may approximate 2,500.
Unlike the fluid milk distributing trade, there does not appear to exist
any establishments of sufficient magnitude, in relation to others, to occupy
a dominant position or have a leading influence within the industry.
In considering the operations of creameries regard should be given to the
relatively low proportion of controllable expenses entering into the total
cost, and the high proportion of material cost.
Approach and procedure:
Under date of December 7, 1946, a circular letter was mailed to 197
selected creameries throughout the Province, requesting them to submit
a copy of their auditor's unabridged report, with certified financial state-
ment, including assets and liabilities, trading or operating and profit and
loss statement, for the fiscal year next preceding October 1. 1946. In the
event that auditors were not engaged, the operators were asked to submit
their own statements. In addition, they were asked to forward an estimate
of net profit for their current fiscal year, before provision for income and
excess profits taxes, the information to be lodged with the Commission not
later than December 17, 1946.
Unfortunately, some concerns were under the impression that the
Commission's enquiry did not embrace creamery operations. The Ontario
Creamery Association was contacted, and it undertook to circularize the
industry so that finally, by February. 1947. a sufficiently satisfactory
response was recorded enabling us to proceed with our tabulations. In
registering the submissions code numbers were employed to ensure privacy
and facilitate handling.
The financial statements were first sorted into three geographical areas,
viz.. the western and southern section of the Province, the central and
northern area, and then the eastern. The returns were then tabulated as
to type of business, i.e.. proprietory or incorporated company, sales volume,
net profits (before provision for income and excess profits taxes), capital
employed, fixed assets, investments, etc. A further listing was made
according to sales ranges of the individual concerns. The estimates of
net profits for the current fiscal year were also tabulated.
It was following a review of these financial statements and our analyses
and tabulations that a decision was made to send a form of questionnaire to
a representive cross-section of the industry with a view to obtaining more
detailed accounting and statistical data for the pui-poses of this report.
The questionnaire was the same as was used for the survey of fluid milk
distributors, since the time element was important and it was considered
the various schedules were conviently adaptable to the creamery trade.
Following are our observations and findings on both the financial state-
ments and questionnaires submitted to us.
Review and tabulation of financial statements showing
overall operating residts:
Of the 197 concerns from whom financial data was requested, 142 sub-
mitted statements which we were able to include in our tabulations. The
remaining 55 were excluded for various reasons, chiefly on account of
insufficient detail.
Of the 142 recorded, 41 are incorporated companies. Geographically 71
relate to the western and southern portion of the Province, 50 to the
central and northern area, and 21 to the eastern area, 44 counties and
districts being represented.
APPENDIX 23
Our review of the financial statements, relating to proprietory concerns
in particular disclosed wide variance between individual businesses in
the matter of proprietors' and partners' salaries. In order to properly
determine the earnings of individual concerns and establish a comparable
basis in this regard, it was necessary for us to adjust the reported profits
in many instances, and apply a salary charge in accordance with a pre-
determined scale developed by us. Thus, so far as this item of expense is
concerned, all proprietory and partnership businesses were placed on a
uniform basis. No other adjustments were made by us to the reported net
profits, which were after charging interest on borrowed monies.
We have not included in our tabulations the operating results of cream-
eries owned or controlled by chocolate and ice cream manufacturers, pack-
ers and canned food processors, it being considered that the Royal Com-
mission was primarily interested in the operations of independents. The
majority show earnings ranging from less than 1% of sales to more than
6^c while some show operating losses.
Observations regarding financial statements and questionnaires:
The financial statements submitted disclosed a lack of uniformity in
accounting practice and suggested a tendency on the part of the smaller
businesses to be satisfied with statements which gave little consideration
as to their being informative from an operating or administrative viewpoint
or not. In only a few instances were comparative figures or percentages
shown. The great majority of statements dealt only with the overall
position, profit margins by products being given in only a few instances.
The response to the form of questionnaire was helpful although a number
were incomplete in one particular or another, indicating that the accounting
and statistical records in general were not as comprehensive as they should
be. As mentioned, we did not prepare a separate questionnaire for the
creameries, but used the same form as for the fluid milk distributors and
this may have some bearing on the matter.
The foregoing broadly covers the approach to the problem and the
procedures followed, although reference might be made to the considerable
volume of correspondence, both inw^ard and outward, and the consultation
which became necessary in order to obtain as complete and reliable data as
possible with the minimum delay. It will be appreciated that our survey
occurred at a most inopportune time when most businesses were pre-
occupied with the closing of their books of account for the fiscal year and
later the preparation of income tax returns. Thus, a certain amount of
correspondence and delay was inevitable.
Overall operating results
for the fiscal year next preceding October 1, 1946
Exhibit (a), attached, summarizes the overall operating results of the
142 establishments included in our tabulations, 41 of which are incorpor-
ated companies and 101 proprietory or partnership businesses.
It will be noted that the net profits (before taxes) from the sale of all
products totalled $460,919 and equalled 1.43?f of sales and 13.29'7r of capital
employed, the latter being calculated substantially in accordance with the
provisions of the Dominion excess profits tax act.
The rate of earnings of the creameries located in the central and northern
sections of the Province are higher than elsewhere. The western section,
where most of the creameries are located, being second, and the eastern,
lowest. This earnings comparison by areas is substantiated by the ques-
tionnaires returned to us. »
The profit figures shown are as reported by the concerns themselv'es. or
their auditors, except where adjustment in respect of proprietors' or
partners' salaries was found necessary.
For all practical purposes the earnings rates given may be accepted for
the industry as a whole as other tabulations and computations made by
us show only a fractional variance. Furthermore, a recapitulation of the
questionnaires received from a representative cross-section of the industry
shows net profits (before taxes) of 1.36% of sales, a difference of only .07
of one per cent.
If the rate of 1.43'7f is applied on the creamery butter sales of the industry
for the calendar year 1946, which have been estimated at $27,000,000, the
net profit would amount to $386,100 which, compared with the amount of
156 APPENDIX 23
$460,919 shown as the overall profits of 142 concerns, clearly indicates that
the creamery industry produces large quantities of products other than
creamery butter. Without more information than is presently available
to us, it is not possible to give authentic figures regarding overall sales
of all products of the industry, but from such data as we have developed,
it would appear that total sales, including both domestic and export, for the
fiscal year immediately preceding October 1, 1946, might approximate
fifty million dollars for the entire Province. Predicated on such figure,
creamery butter would represent about 54% of the total dollar sales.
On the assumption that the foregoing estimate of total dollar sales is
i-easonably correct, and based on the unit costs of butter as given later
in this report, we have developed the following summary:
TABLE 2
Summary of estimated operating results
of creameries located in Ontario for the
fiscal year next preceding October 1, 1946
Net profits % of
Sales (before taxes) sales
Creamery butter §27,000,000 S340.200 1 . 26
Other products 23,000,000 374,800 1.63
Totals §50,000,000 S71.5.000 1.43
Having regard to the amount of capital employed as shown in exhibit (a)
it may well be that the capital employed for the industry as a whole, as
calculated substantially in accordance with the provisions of the Dominion
excess profits tax act, might approximate $4,500,000.
Although the ratio of net profits to sales may seem low in comparison
with certain other processing or distributive trades, the return on capital
employed is, we believe, eminently satisfactory at 13%. We might also
mention that since the raw material cost represents approximately 85%
of selling price, the return in relation to the processors' efforts and ex-
penditures would not seem inadequate.
Classification of businesses hy sales volume:
As regards exhibit (b) (tabulation of sales groupings), it will be noted
that the percentages of net profits to sales vary considerably.
We would direct attention to the downward trend of group 3 in relation
to group 2, also the relative uniformity in the rate of earnings of the
concerns enjoying annual sales in excess of $100,000 per annum, both of
which conform with our findings in regard to distributors of fluid milk.
Regarding individual operations, only 75% to 80% of the independent
creameries in the Province appear to have operated at a profit during the
fiscal year next preceding October 1st, 1946.
Operating losses oj individual businesses:
Of the 142 businesses included in our tabulations, 33 or 23% incurred
losses. This proportion is applicable io each of the three areas mdicating
that perhaps one out of every four or five creameries throughout the
Province operated at a loss during the fiscal year next precedmg October
1st 1946
Individual losses ranged from $59 to $7,781, the 33 concerns incurrmg
and aggregate loss of $59,302 as shown hereunder.
TABLE 3
Summary oj 33 concerns showing operating losses for the fiscal year next
preceding October 1st, 1946 , ,
% of Number of
Area Sales Loss sales concerns
Western $2,760,941 $36,363 1.32 16
Central 1,731,936 14,404 .89 12
Eastern 1,055,725 8,535 .81 5
Combined
$5,548,602 $59,302 1.07 33
APPENDIX 23 157
Only twelve concerns relate to the three sales groupings up to $100,000
per annum. Ten concerns, each with sales volumes of between $100,000
and $200,000 per annum, incurred losses and eleven in the next group,
ranging from $200,000 to $500,000 per annum.
These twenty-one concerns in the two highest categories show an
aggregate loss of $42,636 accounting for 72% of the total. This suggests
that the adverse results may not be wholly attributable to inefficient opera-
tion but perhaps a basic condition which has existed within the industry
in recent years, particularly during the period that wartime controls were
in effect.
Were the losses and related sales of the 33 concerns eliminated from
exhibit (b), net profits for the remaining 109 businesses (before taxes)
would aggregate $520,221, which calculated on the related sales total of
$26,795,981 would show earnings of 1.94% of sales for the 109 profitable
operations.
Breakdown of sales revenue:
Since 1939 there has been a definite movement to develop sales of
products other than creamery butter, although wartime controls may be
partly responsible for this development. In any event the overall dollar
sales have almost doubled, yet the production of creamery butter at the
close of 1946 showed a reduction of 21% from the 1939 level.
The output of condensed and powdered whole milk has increased two-
fold since 1939 and it may be that these two products are mainly responsi-
ble for the increase in dollar sales of the creamery industry.
From the tabulation of questionnaires indicating an average overall net
profit margin of 1.36''/r of sales, we have prepared the following summary.
The figures shown have been developed from returns which provide a
representative cross-section of creameries located in Ontario and which
engage in combined operations, processing fluid milk, cream, and other
products in addition to creamery butter.
TABLE 4
Breakdown of overall sales revenue from all products fiscal year next
preceding October 1st, 1946
% of % of
sales total cost
Sales 100.00
Cost of:
Materials and ingredients (including haulage).... 87.63 88.84
Processing 7.63 7.74
Selling and delivery .71 .72
Administrative and general expense 2.67 2.70
Total cost 98.64 100.00
Net profit (before taxes) 1.36
100.00
The above shows that 88.84% of the total cost of all products is repre-
sented by materials and ingredients. Of the remaining 11.16% only part can
be said to be controllable from the processors viewpoint, as there are
certain fixed or semi-fixed charges, such as, depreciation, insurance, light,
heat, business and property taxes, etc., over which the processor has
little effectual control.
Under such conditions the essentiality of volume production and a high
standard of operating efficiency is evident, if a reasonable profit is to be
assured. A breakdown in the flow of production or a major repair cost
is sufficient to seriously reduce profits, if not to eliminate them.
An alternative breakdown by the various elements of cost in relation
to overall sales revenue is given in table 5 which follows:
l-^O APPENDIX 23
TABLE 5
Breakdown oj total sales revenue hy elements of cost — Fiscal year next
preceding October 1st, 1946
% of sales
Sales 100.00
Materials — Raw materials, ingredients.... 85.98
Haulage to creamery 1.65
87.63
Containers and packages .65
Material cost 88.28
Wages — Production 4.48
Selling and delivery .03
Administrative and general 1.77
Labour cost 6.28
Facilities — Repairs .70
Depreciation .84
Services, etc 2.54
Facilities cost 4.08
Total cost 98.64
Net profit (before taxes) 1.36
100.00
Labour is the most important item of controllable expense. The charges
for repairs and provision for depreciation are not considered unreasonable,
the latter representing but 6Tr (approximately) of original cost of plant
and machinery. Of the services cost shown at 2.54% of sales revenue, the
most important items included therein are light, heat, and power, municipal
and property taxes, telephone and general expenses.
Costs and profit margins
creamery butter
for the fiscal year next preceding October 1. 1946.
We give below a breakdown of the costs of manufacturing creamery
butter as disclosed by a representative group of creameries selling through
both wholesale and retail outlets. Being average figures they should be
regarded as a standard of measurement or comparison for general applica-
tion only, as the selling prices and proportions of the different grades of
butter and the various elements of cost show appreciable differences as
between the different localities and individual creameries.
TABLE 6
Manufacturing cost of creamery butter
for the fiscal year next preceding October 1. 1946.
Cents
Per
% Pound
Sales 1(X).00 35.
Cost of:
Churning cream and ingredients 82.51 29.09
Hauling 1 , 80 63
Containers and packages 1 . 38 49
Material cost 85.69 30.21
APPENDIX 2S
Cost of: (^ n- ■> 1 .{
Processing, labour • • • •. ^-^^ - '^
Selling, administrative and general salaries ^^-^
, , , 7.90 2.78
Labour cost
^•^^^«^; 85 .30
Rei^airs. ^^ 32
Depreciation ,, ".^ , or,
Facilities "^ '^^ ^-^^
=> Ti IS"''
Services cost ________:
Totalcost ^8.74 34.81
Net profit (before taxes) _ll??____^
The costs and selling prices of the three largest distributors of fluid milk,
who also produce large quantities of butter, are very different to the
above The selling prices of the three concerns ranged from 32 cents to
41 1/2 cents per pound in 1945 and 1946. Two of the concerns reported
losses ranging from 2.67% of sales or .84 of one cent per pound to 4.13% ot
sales or 1.63 cents per pound. The third, which sold at the highest price
of the three, realized a profit.
The combined butter sales of these three concerns alone exceed $3,50U,UUU
per annum, or 15% of total creamery butter sales, the great proportion of
which is sold in the metropolitan and urban centres. The extent to which
such sales may affect the operating results of producers of creamery butter
is difficult to determine. However, the butter production of the larger
fluid milk distributors, packing houses and others is in direct competition
with the creamery industry.
Since 1939 the purchase prices of sweet cream, churning cream, and
whey cream, have advanced substantially, the first two mentioned increas-
ing more than 50%, and whey cream in excess of 60%. When it is
considered that the raw material cost to the creamery operator approxi-
inates 85% of his selling price, the essential nature of the various types of
produce demanded that some relief be extended the industry by way of
increased selling prices or subsidies.
Financial Position
The questionnaires indicate that, in terms of dollars, the overall sales
volume of creameries, including all products, has almost doubled since 1939.
while net profits (before taxes) for the fiscal year next preceding October 1.
1946. are slightly less than in 1939. Substantial sums have been expended
on improvements and additions to olant machinery and equipment, yet the
working capital position has not deteriorated.
The following summary provides an accounting of funds over the six
years 1940 to 1945 inclusive, in respect of a representative group of
creamery operations. It provides an indication of the financial policy
followed by the creamery industry in recent years.
Net profits 1940 to 1945, inclusive $222,695
Reserved for depreciation 139,707
Total to be accounted for $362,402
Dishiirsed as follows: % of
Expended on improvements and additions to plant total
machinery and equipment $164,369 45.36
Increases in accounts receivable, inventories and
investments 191,958 52.97
Withdrawn for income and excess profits taxes 77,943 21.51
Withdrawn for drawings, dividends and surplus
adjustments 91,710 25.30
Deduct $525,980 145.14
Increase in bank loans and current liabilities 163,578 45.14
Total as above $362,402 100.00
160 APPENDIX 23
To meet the increased demand for creamery produce in recent years,
improvements and additions to manufacturing facilities were necessarily
involved. The expenditures since 1939 represent about 50% of the gross
value of fixed assets for the group as at the close of the 1939 fiscal year,
and exceed the total amount reserved for depreciation during the six year
period 1940 to 1945. Our calculations show that the present net book
value of plant, machinery and equipment for the group is less than 50%
of original cost which is, of course, substantially less than replacement.
The rate of inventory turnover varies considerably between seasons. As a
whole it is thought that the industry may average a rate of 15 to 20 tirnes
per annum. Accounts receivable are an important item in the financial
position, and in total, may approximate the value of inventories. They
are, however, in low ratio to the industries' dollar sales.
The foregoing indicates that the investment in fixed assets and the work-
ing capital requirements of the industry are not large in relation to its
sales volume and, at the rate of earnings maintained in recent years, it
would appear that the industry is capable of earning sufficient profits to
equal the entire amount of its invested capital in a period of ten years or
less. Information extracted by us from financial statements indicates that
the industry may have one million dollars of outside investments, princi-
pally in Dominion of Canada bonds, and that mortgages, notes, and other
long term indebtedness may approach two million dollars.
Having regard to the essential character of the industry's production,
the element of risk is not a serious factor and this should not be overlooked
in considering the rate of earnings.
A review of the foregoing leads to the conclusion that the plant, equip-
ment, and manufacturing facilities of the industry have been well main-
tained and that financially the industry, as a whole, is in a reasonably
sound position, showing little evidence of impairment over recent years.
Selling prices — creamery hutter
In 1939 the average wholesale price at Toronto approximated 24 cents
per pound. By the close of 1941 the price had advanced to 341/2 cents and
this price level was largely maintained until April, 1946, when the price
was increased to 40 cents.
On April 30, 1947, the Dominion government subsidy of 10 cents per
pound of butterfat (equal to 8V2 cents per pound of butter) was ter-
minated and the following day an increase of 10 cents per pound was
authorized, bringing the Toronto price up to 48V2 cents. At the time of
this report ceiling prices have been removed and the prevailing market
price is 51 1/2 cents per pound.
Although, as we have shown, wholesale prices increased approximately
70% from 1939 to the close of 1946 and by 114% up to the time of this
report, it must be remembered that the costs of raw materials, labour
and operating supplies have also advanced very considerably. Of the 10
cents increase in May, 1947, 8V2 cents went to replace the producer subsidy,
the industry benefiting by only 11/2 cents per pound or 15% of total.
Other price increases authorized on May 1, 1947, which should benefit
the creamery industry, include 2 cents per pound on dairy and whey
butter, 3 cents per pound on cheddar cheese (at manufacturers level) and
30 cents per case of evaporated milk, although it should be mentioned
that the greater part of such increases reverted to the producer to com-
pensate for loss of subsidy.
From the information before us, we are of the opinion that during
the years 1940 to 1945 inclusive, the adjustments in selling prices ot
creamery butter, also the subsidies, did not permit the recovery 01
increased costs of production in their entirety, as and when they were
incurred. The selling price increases in 1946 and of May, 1947, conibmed
with the termination of butter rationing and price controls should,
however, be of considerable benefit to the creamery operators.
Sufficient time has not elapsed to accurately gauge the effect on earnings
of the last price increase referred to, but we believe the present price is
adequate under existing conditions and that profit margins on creamery
butter may now be reasonably attractive.
APPENDIX 23 161
Diversification of Products:
We have found that those concei'ns engaged in combined operations
enjoy an improved margin of profit. An analysis of financial statements
and questionnaires relating to 26 such concerns shows that the combined
net profit (before taxes) for the fiscal year next preceding October 1,
1946, represented 1.97% of overall sales or 50% more than the overall
rate for butter producers only. Of the 26 establishments, 17 were located
in Western Ontario, 2 in the north, 4 in the central sector and 3 in
the east, so that the group may be considered as being representative
geographically.
We believe that in the assembly of any statistical or financial data
such concerns should be segregated and reported on separately since
their influence as regards both sales and profits on the overall position of
the creamery industry is considerable.
Price spreads — creamery butter
Unfortunately, only a very limited amount of data is available on this
subject, due to the qtiestionnaires not being satisfactorily completed in
many instances. It is evident that the statistical records of the creameries
fall short of what is desirable.
Many concerns do not maintain any quantity of records for either
purchases or sales, others maintain one, but not the other. Where
quantities are available the dollar value is occasionally missing,
which renders the submission useless for the purpose of determining price
spreads. Very few concerns appear to record separately the quantities
and value of the various grades of butter sold through retail outlets as
distinct from brokers and wholesalers. If accurate costing and proper
management control is to be exercised, such data is essential.
We can, therefore, only provide a general indication such as shown in
table 6, wherein the average cost of butterfat, salt and other ingredients
for the fiscal year next preceding October 1, 1946, is shown at 29.09 cents
per pound against a selling price of 35.25 cents resulting in a spread of
6.16 cents per pound equal to a gross margin of 21.24% on cost.
Having regard to the increase in selling price authorized in May last,
it is considered that this spread may have increased by about one cent
per pound after allowing for such increased costs as may have occurred
since the latter part of 1946, so that creameries may presently be operating
on a spread of 71/2 cents per pound.
As a matter of interest and as a general indication we might mention
that the usual brokerage commission is V4 of one cent per pound plus
storage and other charges and that the retail trade may average a gross
spread of 2V2 cents per pound the year round.
Sales outlets
The overall average price spread is influenced by several factors in-
cluding the proportion of each grade to total and the quantities sold through
brokers, wholesalers, direct retail and conumer outlets. Some creameries
do little, if any, direct retail and consumer sales (or "print" trade as it is
sometimes called), others do substantial volume. Some deal exclusively
through brokers and others through wholesalers. There is no general
marketing policy followed by the indu^+i-y. each creamery pursues its
own course, having regard to local conditions and other considerations.
We understand that a fair proportion of the creamery butter pro-
duction is marketed through brokers, each of whom has his own clientele
amongst both the butter producers and buyers. As agents they operate on
a commission basis, selling principally to the wholesale trade. We are
advised that departmental and chain stores are sold on the same basis
as the wholesalers.
From the foregoing it would appear that once the butter leaves the
creamery the producers have no control and little, if any, information
as to the proportions sold through the different merchandising outlets.
Such marketing methods may be the most practical and efficient, but it
must be admitted that it places a great responsibility on the broker and
wholesaler as they can influence the price and production of both the
ci-eam producer and the butter manufacturer through the eflFectiveness
162 APPENDIX 23
of their merchandising policy in obtaining the maximum distribution on
the most favourable terms at peak production periods and throughout the
year.
Wage rates and labour costs
From the information available to us it would appear that few creameries
have labour agreements with any trades union organization. The majority
are operating on a 48 hour week, granting statutory holidays with pay,
also one week's vacation. The present working hours are substantially
less than in 1939 when 55 or more houi's per week was not unusual. This,
combined with the enlarged operations, leads to the conclusion that the
total number of employees may have increased since 1939.
Concessions have also been made in wage rates, but the advances
vary considerably between different areas and localities. Based on the
questionnaires it is considered that overall, a fair indication of the average
wage rate increase to creamery employees is afforded by taking a weekly
rate of $20.00 for 1939 and $26.00 for 1946, indicating an increase of 30%.
The substantial increased production in powdered, evaporated and
condensed milk products particularly, was of much assistance in absorb-
ing such advance in wage rates, but with greatly increased costs of raw
materials in addition, relief by way of subsidies and selling price increases
became essential in order to sustain the industry.
Production capacity
According to the answers received from the questionnaires, some cream-
eries are operating at full capacity on a single shift basis of a 48 hour week
the year round, while others are producing at 50% of capacity and upward
on the same basis. Although there is an appreciable seasonal element in
cream and butter production, it would appear that there exists considerable
surplus capacity overall, with this condition being more acute in some
areas than in others.
Trends of sales and net profits
1940 to 1945 inclusive
The questionnaires returned to us disclose that profits have fluctuated
considerably since 1939. in terms of dollars, although from 1940 to 1944.
inclusive, there has been a progressive deterioration in the ratio of earn-
ings to sales, the results for 1945 and 1946 showing an improvement over
1944.
It would appear that the creamery industry had its most profitable year
for a considerable time in 1940 when overall net profits before taxes
showed an increase of 32% over 1939 and equalled 3.14% of sales.
Overall earnings 1946
At the time of requesting financial statements relating to the fiscal year
next preceding October 1, 1946, we requested that an estimate of net profits
be submitted in respect of the current fiscal year, before provision for
income and excess profits taxes. In some instances the actual financial
statements were obtained but in the majority of cases only estimates were
available, most of which related to the year ended December 31, 1946.
Some of these estimates shov/ed marked differences as between indi-
vidual businesses even where they were located in the same area, and
bore no relationship to past performance. Inasmuch as only one month
of the 1946 calendar year remained, we drew the inference that there are
a number of the smaller creamery establishments, at least, which do not
maintain up to date books of account, but operate the year round without
the benefit of such guidance and are perhaps wholly dependent on their
auditor for the determination of profit or loss, which may not be made
until two or three months after the close of the fiscal year.
Our review of the financial statements relating to the year 1946 m
conjunction with the estimates submitted and other data inade available
to us indicate that the overall net earnings of the creamery industr>'^ in
1946 approximate those for the fiscal year next preceding October 1. 194b.
APPENDIX 23 163
Oxitlook jor 1947
As regards the year 1947, official statistics show that for the quarter
ended March 31. 1947. creamery butter production exceeds that for the
corresponding period in 1946 by 13.7K'r while cheddar cheese production
has declined by 4.25%.
Within recent months price controls have been relaxed on butter, cheese,
and evaporated milk as well as certain other products and selling prices
to brokers, ^wholesalers and retailers have been increased although the
bulk of such advances was to compensate the producers for withdrawal
of subsidies. Nevertheless, appreciable benefit should accrue to the
creamery operators. We, therefore, are of the opinion that provided
satisfactory sales volume is maintained at the consumer level and there
seems no present indication to the contrary, also that labour costs and
costs of materials and supplies do not advance unduly, the year 1947
should see a fairly substantial improvement in the overall earnings of
the industry as compared with 1945 and 1946. In other words, we share
the view that largely as a result of subsidies, the industry, in the Province
of Ontario, has survived a trying experience, with its resources unimpaired
and should now be able to consolidate and develop its position.
The industry should also benefit from the reduction of income and
excess profits taxes applicable to 1947, including Provincial taxes, the
net saving being approximately 23''^r of the rates for the fiscal year next
preceding October 1, 1946.
Observations and Conclusions
It is well to emphasize the range of products manufactured and the
pioduce traded in as well as the heterogeneous composition of the creamery
industry in the Province of Ontario. Of the 279 licensed, processing and
distributing establishments, the great majority are relatively small inde-
pendent enterprises of a proprietory, partnership, or co-operative character,
only a few incorporated companies being within the industry.
With the recent withdrawal of subsidies by the Dominion Government
and the consequent increase in broker and wholesale prices of butter,
cheese and evaporated milk, etc.. the industry is facing a period which is
vital to its own well being and that of the consuming public, as well as
the producers of fluid milk and cream. Our observations are, therefore,
directed at the future as well as at the past.
We believe that, despite the difficulties of dealing with a multiplicity
of independent establishments, the industry is capable of maintaining
itself on a sound basis in the interests of the consumer and producer alike,
provided those responsible are properly and regularly informed, not
only on past performance, but future trends; the latter perhaps more than
the former as in recent years the industry has functioned under emergency
controls so that operating conditions and results do not provide the
same degree of guidance that would be afforded normally. The time,
therefore, is most opportune for the industry to plan for the future.
Possible increases in sales revenue:
The recent increases in the selling prices to brokers and wholesalers on
butter, cheese and evaporated milk particularly, should result in an
appreciable increase in the revenues of the industry.
If the desired effect is not obtained from the present price structure, the
industry is virtually at liberty to make such other price adjustments as
may be necessary to achieve the desired result.
In an industry such as the creamery where profit margins are narrow
and volume of production essential to profitable operation, the importance
of a sound selling price structure cannot be over emphasized.
Possible savings and economies:
As about 87"vr of the total cost of creamery butter is represented by
material cost the margin on which economies might be effected is limited
especially when fixed charges, such as property taxes and depreciation,
are eliminated.
The actual conversion process from cream to butter is the largest cost
factor of the processor and to properly explore the possibilities of any
164
APPENDIX 23
savings in this phase of operations would first entail the assembly of
detailed data far in excess of that which is available to us.
Selling and delivery expenses as well as administrative and general
expenses are not important elements of cost and appear to be kept at a
m.inimum.
In the consideration of all cost factors the seasonal element of butter
production must not be overlooked.
If a determined effort is to be made to hold processors costs within
certain limits the assembly of sufficient, detailed, statistical data is a pre-
requisite.
Statistical data:
Based on our examination of financial statements, questionnaires, and
other data, we are of the opinion that a contribution to individual earnings
and the profits of the industry as a whole would result from the intro-
duction of —
(a) Standard form of accounting;
(b) Standard statistical records;
(c) Budgetary control or forecasts;
(d) The submission at regular intervals of certain financial, statistical,
and forecast data, to the appropriate Provincial authority.
The adoption of the foregoing would be both reassuring and beneficial to
the public, as well as the creamery operators and producers, inasmuch
as it would ensure up to date information on past performance and future
trends, and bring to light possible savings in costs and inefficiencies in
operation which otherwise might go undetected.
On account of the large volume of production the smallest economy
in costs can be significant in the overall operations.
We find that apparently only a few concerns maintain satisfactory
records as to the quantities of each product sold and the selling price
realized in respect of each type of sales outlet and believe that such
records are vital to the industry as well as the individual operator.
We should also make reference to the desirability of allocation of raw
materials according to end use. We are not aware that any system of
allocation is presently employed and. while individual operators may be
able to obtain their requirements, there seems the risk that overall a
"short" or "long" position on butter or cheese could arise which might be
to the detriment of the consuming nublic, the distributor, and the producer.
Whether such forecasting of available supplies is practicable or not, we
are unable to say. but we suggest that the point might be worth consider-
ing as it has a definite relationship to price and supply, not only as regards
butter and cheese, but other milk products In studving the matter,
allowance would have to be made for the substantial butter shipments
from other provinces also the competitive production of fluid milk distribu-
tors, packing houses and other butter producers.
At the present time there are no official statistics which would indicate
the oupntity and value of creamery butter produced in Ontario and
exported.
In general we are of the opinion that the statistical information presently
available to the Provincial authorities en '"'-eamerv operations should be
carefully reviewed and enlarged upon. The quickest and best results
would be obtained through personal visitation to a limited number of
operations. foUowed bv ronsultptions with all interested parties, so that
the desired objective can be reached with the least delay and the minimum
of effort and expense.
Statistical information on the productive capacities of creamery butter
plants in the various areas and principal localities might be of assistance
in disclosing the balance between producers, processors and consumers.
Classification as creameries:
As with the so called fluid milk di.'^tributors we have found that certain
businesses classified as creameries might better be regarded as condensaries,
or fluid milk distributors, due to the volume of certain products handled.
If accurate and informative statistics or reports are to be compiled, some
clarification is essential. Unless this is done, inaccurate data leading to
incorrect conclusions can result.
APPENDIX 23 165
Changes in ownership:
Although we have not discovered the same activity in the creamery-
industry as in the fluid milk in the matter of amalgamations and absorp-
tions, it is suggested that the regulations which may relate to the sale or
acquisition of creameries be reviewed so that the provincial authorities are
fully informed on all such transactions before they are actually consum-
mated. It is known that several of the larger fluid milk distributors own
or control some important creamery operations.
Marketing and merchandising:
On the principle that the producer, processor and consumer are each
concerned with the welfare of the creamery industry, the operations of
brokers and wholesalers responsible for the distribution of the production
are of interest. We believe they are rendering a service commensurate
with the margin or mark up they enjoy, but we have not made any specific
investigations.
It may be that a separate study of this subject should be undertaken,
for there are many complexities even though the export element is
negligible and butter production almost wholly a domestic problem.
General:
Improved co-ordination between all butter producers may perhaps be
to advantage. At present substantial quantities are being produced by
each of the four divisions of the milk industry, viz., fluid milk distributors,
condensaries, cheese manufacturers and creameries. In addition packing
houses process large quantities.
Cost and selling price data is most conflicting, not only as between the
four divisions but also within them, while overall there is no established
marketing policy, and a decided lack of statistical data, as to sales outlets
and related prices.
Such conditions require considerable clarification before any more
definite recommendations could be made in the interests of the cream
producers, the consuming public, and the creamery industry as a whole.
Respectfully submitted,
JOHN S. ENTWISTLE,
Accountant, Royal Commission on Milk,
Province of Ontario.
July 26th, 1947.
166
APPENDIX 23
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APPENDIX 24
ROYAL COMMISSION ON MILK
INDEX TO ACCOUNTANTS' REPORT
SURVEY OF CONDENSARIES
LOCATED IN THE PROVINCE OF ONTARIO
Related Page
table Description number
Assignment, approach and procedure 167
1-2 Industry background 168
Approach and procedure 168
3-4 Overall operating results for the fiscal year next preceding
October 1st, 1946 169
Purchase prices of materials 171
Labour costs 172
Selling and advertising expenses 172
Financial position 172
Selling prices 172
Domestic sales 172
Export sales 173
Price spreads 173
Evaporated milk 173
Condensed milk 173
Marketing methods 173
Earnings for 1946 173
Outlook for 1947 174
Trend in sales and net profits 174
Observations and conclusions 184
Possible increases in revenue 174
Possible savings and economies 174
Product cost and profits margins 175
Statistical data, change in ownership and allocation of
profits between Provinces 175
The Honourable Justice Dalton Wells,
Commissioner,
Royal Commission on Milk.
Accountants' Report
Survey of condensaries
Located in the Province of Ontario
Sir:
In submitting this report reference should be made to the decisions of
the Dominion government to terminate certain subsidies at April 30, 1947,
and to remove evaporated milk from the application of ceiling prices on
June 9 followed by that of the condensary operators to increase prices to
jobbers or wholesalers on July 1, 1947.
These steps were taken as our investigation was approaching completion.
Their affect is far reaching inasmuch as the industry has now resumed
control of its operations thereby reverting to more normal trading condi-
tions. We believe that such measures should result in improved earnings.
Assignment, approach and procedure
Assignment:
We were required to investigate and report on the operations of the
condensary industry located in the Province of Ontario with particular
reference to costs, prices, price spreads, methods of financing and
management.
These matters are referred to in the report which follows preliminary to
which we would submit a few of the more important matters relating to the
industry as a whole and which it is thought might facilitate your conclusions.
[167]
168
APPENDIX 24
Industry background:
The condensary industry in the Province of Ontario produces a wide
range of goods including baby and invalid foods, pharmaceuticals, in
addition to various concentrated milk products such as evaporated and
condensed milk, powdered and skimmilk. Including the condensaries of
the three largest fluid milk distributors it comprises some thirty separate
concerns with branch establishments throughout the Province. Five of
them are subsidiaries or affiliates of parent companies located in Great
Britain, the United States and Canada and these five concerns are amongst
the largest in the industry accounting for the greater part of its sales volume
and overall profits.
A trade association, known as the Evaporated Milk Association, is active
in the formation of industry policy, trade practice, and other matters. The
larger condensaries are members and one or more of them are represented
on the Milk Control Board as well as on other trade organizations connected
with the milk industry.
The larger concerns sell throughout the Dominion and in addition engage
in export trade on an appreciable scale. Domestic sales are made almost
exclusively through wholesale and jobber outlets.
It has been submitted by the larger concerns that as a result of "ceiling"
prices substantial losses have been incurred on domestic business, and that
export sales are in the main responsible for sustaining earnings over
recent years. This point is referred to later in this report.
According to the statistics of the Ontario Department of Agriculture,
8.01% of the estimated total of whole milk production of the Province of
Ontario for 1945 was used in the manufacture of condensed whole milk,
evaporated milk and powdered whole milk, the three principal products
of condensaries. In 1946 the proportion was 8.38% comprised as follows:
TABLE 1
Whole Milk Production
1945 1946
Estimated Estimated
pounds of %. of pounds of % of
whole milk total whole milk total
Condensed whole milk 36,591,000 .77 33,665,800 .77
Evaporated Milk 227,856,900 4.83 215,740,100 4.95
Powdered whole milk 113,692,000 2.41 116,281,600 2.66
378.139,900 8.01 365,687,500 8.38
As regards evaporated milk, one case consisting of 48 16-oz. cans requires
approximately 103 pounds of whole milk, so that the total of 227,856,900
pounds mentioned above is the equivalent of 2,212,203 cases. Of this
total approximately 50% is produced by two concerns.
We are advised by the Dominion Bureau of Statistics that the production
of concentrated milk products by manufacturers located in the Province
of Ontario for the years 1945 and 1946 was as follows:
TABLE 2
Finished Goods Production
1946 1945
Pounds Amount Pounds Amount
Evaporated Milk 98,103.000 $ 7,515,000 103.543,000 $ 7,962,000
Condensed Milk 14.766,000 1,772,000 15,708,000 1,898,000
Powdered Whole Milk. 14,813,000 5,110,000 14,552,000 4,891,000
127.682,000 $14,397,000 133,803.000 $14,751,000
Malted Milk 1,036.000 186,000 660,000 116,000
Cream Powder 16,000 7,000 8,000 4,000
128,734,000 $14,590,000 134,471,000 $14,871,000
Approach and procedure:
Our examination of the condensary section of the industry covered a
review of the financial statements for the fiscal year immediately preceding
October 1, 1946, in respect of eleven concerns located throughout the
Province of Ontario.
APPENDIX 24
169
The individual sales volumes of these concerns ranged from approxi-
mately $100,000 per annum to over $2,500,000 per annum. The group
comprised seven incorporated companies and four proprietory or partner-
ship businesses with an aggregate sales volume in excess of nine million
dollars including export sales of more than one million dollars.
The principal products of the group are evaporated milk, condensed milk
and powdered whole milk, in addition to skimmilk, ice cream, butter,
casein, as well as a quantity of fluid milk and cream.
Following our analysis and tabulation of financial statements, corre-
spondence and discussions ensued with certain of the more important
concerns, as the result of which supplementary data was obtained. With
the exception of one company, the parent corporation of which is located
in the United States, the utmost cooperation was received and our enquiries
fully answered.
Having regard to the foregoing, it is submitted that our findings provide
a fair indication of the earnings potential of the condensary section of the
milk products industry of the Province of Ontario as represented by those
establishments generally considered as belonging to that category. This
report does not have any reference to the milk products processed and sold
by the larger fluid milk distributing concerns or creameries, although it
is known that they enjoy substantial volume both in the domestic as well
as in the export markets.
We should mention that some delay occurred in the preparation of this
report due to officials of certain Canadian subsidiary companies being
unable to furnish all of the requested data without reference to the parent
organization in the United States. The response of these officials was not
in all cases as prompt as the circumstances warranted and necessitated
considerable consultation and correspondence.
To ensure privacy, each submission was processed under code numbers
so that its identity was not disclosed.
Overall Operating Results jor the Fiscal Year Next
Preceding October 1, 1946
The financial statements and questionnaires submitted to us do not
provide a breakdown between export and domestic sales, or detailed costs
by type of product, except in one or two instances. Where an overall
division was made, sharp contrasts occurred in the costs, chiefly as the
result of using different bases of apportionment of indirect expenses.
With regard to evaporated and condensed milk, the two main products,
the submissions by the largest manufacturers indicate a loss on domestic
sales of evaporated milk and a small amount of profit on condensed milk,
supporting their contention that, due to relatively low ceiling prices in the
domestic market on these particular products during the years 1942 to
1946 inclusive, export sales were chiefly responsible for the profits realized.
A comparison of the financial statements of two of the larger manu-
facturers of evaporated milk in Ontario shows that while the selling prices
are comparable, the costs per case are entirely different resulting in the
larger company, which enjoys a volume three times that of the other,
showing a loss of less than two cents per case on domestic sales against
more than 35 cents per case for the smaller of the two.
Part of the difference of 33 cents or more per case is accounted for by
the disparity in volume, and certain specific items of expense. A difference
in the average laid down cost of raw milk also enters into the reconciliation.
The points we wish to emphasize however are firstly, the difficulty these
two large concerns would have in reaching agreement as to the prices
each could afford to pay the producers for whole milk and secondly,
the risk of arriving at erroneous conclusions regarding product costs and
profit margins without careful study and detailed analysis.
Another point we should mention occurs when dealing with companies
operating plants in one or more provinces including Ontario.
To arrive at the operating results applicable to Ontario operations
apportionment of certain expenses becomes necessary. These require to be
carefully enquired into and then considered in relation to the whole,
having regard to the plant capacity, sales volume, and other factors. Aside
from this however, company policy must not be overlooked, since it has
been found that the bulk of western shipments, with their high freight
rates, are made from Ontario plants, Quebec operations benefiting from
the lower freight rates in the Maritimes area. In addition the Quebec
170 APPENDIX 24
plants enjoy the bulk, if not the entke benefit, of export trade.
The foregoing are important matters from the viewpoint of the pro-
ducers of whole milk as well as that of the Province of Ontario and in this
regard we should mention that we have been unable to obtain from
either the Dominion Bureau of Statistics at Ottawa, or the Provincial
authorities, any indication of the quantities of evaporated, condensed, or
powdered milk, produced in Ontario and which may have been exported.
We are advised that no official statistics are presently available in this
regard.
Having regard to the foregoing, the overall earnings of eleven con-
densary plants located in the Province of Ontario are submitted as
follows:
TABLE 3
Summary of operating results of eleven condensary establishments located
in the Province of Ontario for the fiscal year next preceding October 1, 1946.
Sales — both export and domestic in all provinces $10,427,379
Net Profits (before taxes) 417,446
% of net profit to sales 4.00%
Capital employed 1,191,007
% of net profit to capital employed 35.05%
Note: The amount of capital employed of $1,191,007 has been computed
substantially in accordance with the provisions of the Dominion
excess profits tax act.
The records of past earnings show that the profits of the group were
purely nominal in 1939 whereas for the fiscal year next preceding October
1, 1946, the combined overall earnings (before taxes) exceeded four
hundred thousand dollars. The net profits for that year were al^out
double those of 1944.
The above figures are, in the main, indicative of the rate of the industry's
earnings in the year 1945, which was a record year for condensary
establishments.
The elimination of the combined sales and net profits of the two largest
operators from the above tabulation would result in the sales total being re-
duced to $6,081,342 and the net profits to $210,746, representing 3.47% of
sales or 22.65% of capital employed. Thus the net profits before taxes for
the two large operators combined represents 4.75% of sales and 79.06% of
capital employed.
Raw material costs are of course a most important cost element. Depend-
ing on the type and volume of each product to total, this element of cost
may range from 20% of sales to more than 90% based on 1945 net selling
prices.
Cost of containers, cartons and labels is also a major item. Varying with
the product the cost may account for from two cents to more than twenty
cents of every sales dollar .
Labour again is a variable factor the content per product showing con-
siderable contrast. As a broad indication the total labour cost might range
from 3% to more than 9% of sales.
Another element of cost to which we direct your attention are the
charges made by the parent companies for management and technical
services. Without careful study and assessment of the services rendered
their propriety cannot be passed upon.
For your information we give below a condensed statement of operations
for the fiscal year next preceding October 1, 1946, relating to domestic
sales of evaporated milk. The figures shown are as submitted by the
companies included in the tabulation.
TABLE 4
Evaporated milk (Domestic Sales only)
Condensed statement of operations
for the fiscal year next preceding October 1, 1946
Number of Cases 1 ,062,656
Amount S^ of sales Cost per case
Sales value (at plant) $3.970,860 100.00 $3.74
Cost of raw milk $2366,174 59.60 $2.23
Cans, cartons, and labels 901,702 22 . 70 .85
Material cost $3,267,876 82730 $3.08
390,682
296,510
123,959
9.83
7.47
3.13
.37
.28
.11
$4,079,027
102.73
3.84
($108,167)
(2.73)
(.10)
APPENDIX 24 171
Cost of;
Processing
Selling, advertising
General overhead
Total cost
Net loss
The labour content per case has been estimated at approximately 20 cents
per case which represents 5.35% of sales, thus the above may be broken
down as follows:
Amount % of sales Cost per case
Material cost $3,267,876 82.30 $3 08
Labour cost 212,531 5.35 .20
All other expense 598,620 15.08 .56
Total cost as above $4,079,027 102 .73 $3 . 84
Included in table 4 are the returns of one company which show a loss
on Ontario operations equal to .41% of sales, whereas the financial statements
for the company as a whole show a substantial profit, indicating that
operations outside the Province are by far the most profitable. This we
have been unable to verify as our authority is limited to Ontario operations
and the Company has not proffered any data on operations elsewhere.
As regards condensed milk, the data submitted to us indicates that in
1945 the net profit per case on domestic sales approximated $1.00 and on
export sales only 66c, equivalent to 16% of selling price "at plant" for the
former and 121/2% for the latter. Even with these substantial profit
margins overall earnings, as we have indicated, approximated only 41/2%
so that, according to the calculations of the companies concerned, substantial
losses must have been incurred on evaporated milk sales, and appreciable
profit margins made on other products, such as casein, ice cream, powdered
milk and other products.
Purchase prices oj materials:
Milk to be used for manufacturing purposes came under the jurisdiction
of the Milk Control Board in 1934.
The chief problem has been the producer price. From 1935 to 1942 the
industry operated on a price agreement between producers and processors.
In 1942 no agreement could be reached and the Milk Control Board set a
minimum producer price of $1.95 for 3.5% B.F.M. In 1945 the producers
asked for a 10c increase to $2.05 but this was rejected by the Board as $1.95
was the prevailing price in other Provinces and it was thought that any
increase at that time might lead to the processors establishing the plants
elsewhere. In any event some producers were getting more than the
$1.95 minimum.
According to the questionnaires the purchase price of manufactured milk
has more than doubled since 1939. Depending on the locality the price m
1939 ranged from $1.13 per 100 pounds to $1.16, whereas by 1945 the average
price paid by condensaries varied between $1.99 and $2.05 per 100 pounds.
On October 1, 1946, the established producer price was increased to $2.35
per 100 pounds and in July 1947 a minimum price of $2.50 was authorized.
Based on information furnished in the questionnaires, concentrated skim-
milk between 1939 and 1945 advanced approximately 50% from $2.00 per
100 pounds to $3.04 while churning cream advanced almost 100% per
pound of butter fat. Substantial advances also occurred m the costs of
containers, cartons, and labels, an important factor in condensary costs.
The price of corrugated boxes advanced about 50% during the years 1939
to 1945 inclusive. Prices of cans and wrappers were more closely controlled,
the increases ranging from about 10% to 25%. Barrel costs and the prices
of jute bags were more than doubled while coal prices advanced appreciably.
Increased volume, combined with wartime economy measures and
perhaps improved efficiency in operation were of course of assistance in
countering to a considerable extent the full impact of the increased costs
referred to.
172
APPENDIX 24
Labour costs:
Taking the estimated labour cost of 20c per case of evaporated milk
which from the data before us seems a reasonable figure, and applying it
on the 2,212,203 cases produced in 1945, it appears that the total labour
cost for evaporated milk production aggregated $442,441.
The labour cost of condensed milk is slightly more than 10% higher but
the production volume is very much less, so that on an estimated output
of 200,000 cases in 1945 the total labour cost for this product would
approximate $45,000.
Overall it is estimated that the total payroll for all direct employees
approximates eight hundred thousand dollars for the year 1945.
Since 1939 wage rates of plant employees have advanced by 50% and
office salaries by about 30%. However, the effect of such rate increases in
labour costs has been largely countered by the greatly increased production
and improved efficiency of both employees and manufacturing processes
which has evidently occurred since 1939.
Selling and advertising expenses:
These expenses in relation to sales vary considerably between different
concerns. The costs range from about 1% to over 6% in some cases. Most
products are sold under brand names so that a certain amount of adver-
tising expense is necessary to maintain goodwill and ensure satisfactory
sales volume.
Financial position
A comparison of individual balance sheet positions relating to the years
1939 and 1945 indicates that the condensary section of the milk products
industry improved its financial position very considerably during the
intervening years.
In line with the greatly increased sales volume which has occurred since
1939 in both the domestic and export markets, working capital requirements
have become much larger and it would appear that a fair proportion of
this additional demand has been provided for out of accumulated earnings
and reserves.
Substantial monies from the same sources have also been expended on
improvements and extensions to plant machinery and equipment. These
additions approximate the total depreciation provision for the years 1940
to 1945 inclusive. Two instances are known where the expenditure on fixed
assets durmg the six years is equal to approximately 70% of the total book
value of plant and machinery as at the close of 1939 and about 50%
of total earnings over the six year period referred to.
Funded debt, mortgages, and other long term liabilities, are not an
important item in the financial structure of the industry.
Selling prices
Domestic sales:
As regards evaporated milk the net selling price at plant averaged $3.71
per case during the fiscal year next preceding October 1, 1946, for the two
largest manufacturers. At that time and until just lately ceiling prices
were in effect. These have now been removed and selling prices to whole-
salers advanced by 28 cents per case effctive July 1, 1947. Of this increase
8 to 10 cents has been passed to the producer, the latter now receiving
about $2.43 per 100 lbs. of whole milk which, with an average haulage
charge of 12 cents per 100 lbs., gives a laid down cost to the condensary of
approximately $2.55 per cwt.
Whether the largest manufacturers will serve the same markets in direct
competition with each other remains to be seen, but in this connection
certain of the larger fluid milk distributors engaged in the manufacture of
milk products will no doubt have to be considered.
The average domestic selling price of evaporated milk, at plant, approxi-
mated $2.96 per case in 1939. By the close of 1946 prices had advanced 78c,
the equivalent of 26% for an average price of $3.74 per case. This was
sufficient to take care of the increase in the cost of raw milk which advanced
from approximately $1.46 per hundred pounds in 1939 to $2.20 in 1946.
On the basis of 103 pounds of raw milk per case of evaporated milk, this
is the equivalent of 77c per case, so that little margin was left to offset
the increased costs of cans, cartons, and labels, labour and other costs.
APPENDIX 24 ■'■ '"^
Export sales:
The price structure on exports is different to domestic sales. To conform
with the standards of the different importing countries varying butterfat
contents are required, furthermore, the packing cost is more expensive
than for domestic trade. These factors account for the price variations in
both evaporated and condensed milk, the average export price for the
former usually being higher and that for condensed milk averaging less.
Price Spreads
Evaporated milk:
Following removal of price ceilings and controls just recently, there seems
no useful purpose in submitting data relating to the years that such meas-
ures were in force.
We are informed that, currently a minimum price has been set for the
month of July, 1947, by the Ontario Minister of Agriculture of $2.50 per
100 pounds of manufacturing milk and that it is the intention to review
and set a price for each succeeding month until the situation becomes more
clarified and stable.
On July 1, 1947, the selling price to wholesalers was advanced by 28
cents per case to give an average price at plant of $4.02. On the basis of
103 pounds of whole milk per case of evaporated milk a price spread of
$1.40 per case is arrived at. This appears to be slightly less than the 1939
average spread.
Condensed Milk:
We are informed that no increase in selling price is presently contem-
plated by the manufacturers of condensed milk although they too are
subject to the increase in the cost of whole milk referred to above, their
laid down cost also approximating $2.55 per 100 pounds.
We understand that the manufacturers of condensed milk believe that
present consumer prices are quite high enough and that any further
advance might be detrimental to volume of sales.
Export sales of condensed milk are a very appreciable factor in the
overall profit position of the industry and some apprehension has been
expressed concerning the costs of Canadian manufacturers increasing to the
point that the volume of foreign trade might suffer. The cost data in our
possession however indicates that the profit margin on export sales of
condensed milk would permit of some increase in costs without the necessity
of advancing export prices. Following are the percentage of profit or loss on
selling prices at plant:
Domestic Export
Evaporated milk 9% loss 5 % profit
Condensed milk 16% profiit 121/2% profit
Currently the laid down cost of raw milk converted into a cost per case
of condensed milk approximates $2.20 on domestic business which, based
on an average selling price of $6.36 per case at plant, shows a spread of
$4.16. The cost of processing condensed milk is more than double that of
evaporated milk, but as we have shown the profit margin on both export
and domestic sales is also substantially higher.
Marketing methods
The established practice on evaporated and condensed milk sales, so
far as domestic business is concerned, is to sell on a delivered price basis
through wholesalers. A 2% cash discount is allowed and invariably taken,
so that in considering the net selling price at plant, allowance should be
made for both freight and discount.
Due to the substantial volume of shipments to the western provinces by
condensaries located in the Province of Ontario freight is an important
factor. On evaporated milk the average freight charge approximates 46
cents per case so that combined with the 2% discount, representing eight
cents per case, the net return at plant shows approximately 54 cents per
case less than the delivered price.
Earnings for 1946:
The financial statements relating to the year 1946 show a substantial
increase in the net profits of all companies over those of the fiscal year
next preceding October 1, 1946.
174 APPENDIX 24
The year 1946 saw a reduction of 10% in the dollar value of exports from
Canada of whole milk powder, condensed milk and evaporated milk as
compared with 1945. How much of this reduction related to Ontario is
not known, as statistical records are not presently available.
Outlook jar 1947:
The dollar value of Canadian exports of evaporated, condensed, and
powdered milk for the first quarter of 1947 shows a reduction of 24% from
the corresponding period in 1946. If this unfavourable condition is main-
tained throughout the current year, the total value of exports from
Canada of the three products mentioned for 1947 will show a reduction of
one-third from the 1945 levels. As previously stated the amount which
might be applicable to Ontario cannot be estimated in the absence of
statistical data.
Some improvement in the earnings of the industry may be looked for as
the result of the termination of subsidies, the lifting of price controls and
the increase in the price of evaporated milk to wholesalers in July, 1947,
the industry having now virtually resumed control of its own affairs. The
reduced scale of taxation of profits, as announced in the 1946 and 1947
budgets of the Dominion government, should also benefit the industry.
Provision for profits taxes in 1947 should indicate a reduction of approxi-
mately 9.4% as compared with 1946.
With ample financial resources at its disposal we see no reason for
anticipating any serious reduction in the earnings of the industry for 1947.
Trend in sales and net profits
The questionnaires reveal that both sales and net profits of the industry
have, in terms of dollars, increased substantially since 1939. Sales have
doubled while net profits, before taxes, have advanced on an even greater
scale. The extent to which export business may have influenced earnings
is difficult to determine. Its contribution in supplementing production,
thereby improving the ratio of output to capacity, also its absorption of
part of the overhead expenses bringing about a reduction in overall unit
costs must have important bearing on profits. We have enquired into these
matters but have to report that the data made available to us is not
sufficient to permit any reasonably accurate assessment.
Observations and conclusions
The survey indicates that the condensary industry has expanded and
strengthened its financial position very considerably since 1939. Production
has increased appreciably while, in terms of dollars, sales have doubled and
net profits (before taxes) have increased even more. For the year 1946 the
return on both sales and capital can only be regarded as being eminently
satisfactory from the industry viewpoint.
As regards operating results of the current year, even though a con-
traction has occurred in the export sales volume during the first few
months of the current year, the adverse effect on overall earnings may be
largely offset by the benefits resulting from the removal of price controls
on certain of the main products, the recent price increase in evaporated
milk and the reduced scale of profits taxation.
The industry is presently assuming command of its own affairs after
several years of government control so that it is now at liberty to exercise
its initiative in meeting the problems as they are anticipated. If the
desired objectives may not seem attainable, corrective measures can be
taken.
Possible increases in revenue:
The effect on operating results of the recent increase in the domestic
wholesale price of evaporated milk cannot yet be measured. It appears
unlikely that it will adversely affect volume so that, provided export sales
can be maintained, sales revenues should exceed those of 1946.
We understand that no increase in the price of condensed milk is
presently contemplated by the manufacturers. It remains to be seen
whether present prices will continue for the remaining months of the year.
Possible savings and economies:
Without considerably more operating data than has been made available
to us we feel unable to make any concrete proposals.
APPENDIX 24
175
Most of the companies in the condensary division of the milk industry-
are substantial and successful businesses enjoying a high standard of
managerial control and operating efficiency. The record of progress over
recent years bears testimony to this. They have demonstrated their ability
to overcome the problems of the past and may be depended upon to
successfully cope with those of the future.
Product costs and profit margins:
Until such time as a greater degree of uniformity in accounting and
costing procedures is brought about we consider that the utmost caution
should be exercised in the acceptance of any product cost figures. As with
other divisions of the milk industry we have found that seemingly wide
disparities between different concerns can frequently be fully accounted for,
or considerably narrowed or reduced by the application of the same
principles of apportionment of overhead expense to each.
Statistical data:
We are of the opinion that the information presently available to the
Provincial authorities regarding condensary operations is not sufficiently
complete, having regard to (1) the essential character of the finished
products to the public welfare; (2) the influence of the industry on pro-
ducer prices and supply of whole milk for fluid and other purposes;
(3) the structure of the industry, which is virtually dominated by three or
four large concerns with parent companies located abroad.
It is suggested that if in the interests of the consumer public it is
considered that Provincial authorities should be fully informed on past,
current, and future affairs relating particularly to the fluid milk industry,
the statistical data should be sufficiently comprehensive to embrace all
phases of the milk industry as each section has an important bearing on
fluid milk prices and supply. Such data might cover export as well as
domestic business, both within the Province of Ontario and outside.
On account of the large volume of concentrated milk products manu-
factured by certain large processors listed as fluid milk distributors, it
would seem that some reclassification is desirable to ensure complete and
accurate data. This might be undertaken by the Milk Control Board and
the Evaporated Milk Association in conjunction with the Ontario Milk
Distributors' Association.
Omission to file brief:
The decision of the manufacturers of concentrated milk products not to
submit any brief or make any direct representations to the Commission
may not be of any significance. Had representations been made, however,
we feel sure that our work would have been considerably facilitated.
Change in ownership:
As with other divisions of the milk industry it is suggested that full
particulars of any absorptions or amalgamations both within and without
the industry be furnished the appropriate Provincial authorities before
consummation.
Allocatio7i of profits between Provinces:
Where concerns have operations in other provinces or elsewhere, con-
sideration might be given to the submission of appropriate data concerning
such other operations. Such measures would seem to be in the interests
of the producers and other divisions of the milk industry in Ontario as
well as the consuming public.
This observation results from the reference on page 171 of this report
to operations outside the Province of Ontario. The company referred to
has burdened its Ontario operations with all its costly western business
retaining the benefits of export trade and the domestic business carrying
relatively low freight charges for its Quebec operations. Such a policy
seems hardly fair to the Ontario producer if manufacturers margins are
used as an argument for holding down producer prices as they may well be.
Respectfully submitted,
JOHN S. ENTWISTLE,
Accountant, Royal Commission on Milk,
July 26th, 1947. Province of Ontario.
APPENDIX 25
The Honourable Justice Dalton Wells,
Commissioner,
Royal Commission on Milk.
Report on Cost of Whole Milk Production
General nature of enquiry:
Sir:
We have investigated the evidence and many statements and estimates
of various sorts relating to cost of production submitted by a large
number of individual producers as well as that supplied by Provincial
and regional producers' organizations. In addition we have taken into
account the independent survey of representative producers in different
sections of the Province made with the assistance of five graduates of the
Ontario Agricultural College. The period under review was substantially
the 1946 calendar year.
Other surveys:
We have studied the results of many other investigations on this subject
including:
The "Hare" Report published by the Dominion Department of
Agriculture.
Cornell University Studies of Costs and Reports from Farm Enter-
prises, including Misner Report prepared in conjunction with the
New York State College, Cornell University Agricultural Experi-
mental Station, Department of Agriculture of Economics, Ithaca,
New York.
University of Illinois Report on Cost of Producing Milk in
Northern Illinois.
An Economic Study of Dairy Farms in the Province of Alberta by
Howard Patterson.
The above mentioned surveys and reports included elaborate _ studies
of costs of producing each of the dairy farm feeds, pasture costs, time and
labour elements, depreciation, maintenance, replacements, bedding, in-
ventory variations, and miscellaneous expenses. Credits, such as milk
consumed on farm, manure, profits and losses on purchase and disposal
of cattle were also reviewed.
Survey method:
There are a variety of methods which may be used to obtain cost
information and among these are:
Estimation Method.
Farmers' Record Plan.
Detailed Accounting or Route Method.
Survey Method.
The latter method was adopted in this case as the one most likely
to secure, within a reasonable degree of accuracy, the required information,
and within the relatively limited period available. Other methods were
found to be unsuited for the particular task of the Royal Commission.
Feeds, etc.:
There are tremendous variations in feeding methods, and in the
amount, kind and value of buildings and equipment employed and the
manner in which the necessary labour is performed. For example, some
farmers tend to combine a relatively large amount of home grown rough-
age with a small quantity of cheap concentrates. Other farmers are in
the position where they are obliged to reverse this practice and make
substantial cash purchases of feeds, particularly concentrates, and in
[176]
APPENDIX 25 177
many instances expensive concentrates. The quality and prices of con-
centrates vary within a wide range.
It must be borne in mind that cost figures, which appear later in this
report, relate to conditions as they existed in the year 1946 and that
past experience has made it abundantly clear that special climatic and
other conditions may exercise a pronounced influence on costs in any
specific year. These climatic conditions virtually determine the cost of
home grown feeds which normally Qonstitute a very large part of the
total net costs.
Hay:
Hay costs vary throughout the Province depending on location, yield,,
whether bought or home grown, costs of transporting bought hay, and also,
on whether the hay is of high or low protein content, etc.
Silage:
Silage costs vary from farm to farm due mainly to yield variation of
corn and other silage crops. Other factors responsible are different
valuations of land and silos and operations used in the technical methods
employed in harvesting. While corn silage is the kind most commonly
used throughout the Province, recent years have seen increasing use of
other types of silage with consequent variations in silage costs. It is.
recognized also that irrespective of the kind of silage, its actual feeding
value varies very considerably.
Pasture:
We have consulted with recognized experts on the subject of pasture
costs. These vary substantially depending on whether the pasture land
is improved or unimproved and whether it is natural or rough pasture.
Other factors include variations in location, fencing expenses, taxes and
value of land used.
Labour:
Many producers are able to rely upon their own labour and that of
members of their family, whereas others are compelled to use hired help
almost exclusively. In this connection it is a noteworthy fact that labour
efficiency shows a pronounced variation. Labour costs vary depending
upon whether hand or machine methods are used in milking, feeding,,
cleaning, etc., and also vary according to season of year, quantity produced,
weather conditions, and many other circumstances, such as proximity to
urban centres, relative scarcity of labour, proper training or lack of it,
degree of efficiency, number of hours worked, different rates of wages;
paid and also the value of perquisites.
Depreciation on Equipment and Buildings:
Different rates of depreciation have been claimed by producers through-
out the Province. After having made a study of this subject, and after-
having consulted recognized authorities, average annual depreciation rates
of 8% have been provided for on dairy machinery and equipment and
3 1-3% on buildings.
Inventory values:
Wherever possible the variation in inventory value of cattle has been-
taken into consideration but in no instance, to our knowledge, has the-
valuation been shown in excess of cost.
Hauling:
The main cause of difference in hauling costs is the variation in the-
distance from market. Since nearly all milk is transported in trucks,
and smce all farmers within the same trucking zone pay the same trucking
rate per 100 lbs., the chief reason for differences in transportation cost as
between farms, is the fact that different farmers live in different zones.
Actually the major variations in transportation costs relate chiefly to
producers who supply the Toronto market. Producers shipping to Toronto-
may live m any one of at least six zones and, therefore, pay any one of six:
178 APPENDIX 25
rates pei- 100 lbs. of milk. However, some producers haul their own milk
and consequently have somewhat different costs for that reason.
Miscellaneous expenses: — cover the many other items not enumerated in
the table of costs. Included in these numerous items of costs are such items
as breeding, taxes, bedding, repairs, maintenance, veterinary fees, etc.
Bedding costs:
The extent of these costs depend on whether bedding material is
purchased or is obtained by using home grown straw, which cannot be
effectively used for other purposes. As combine threshers are being used
to an increasing extent the cost of producing straw for bedding is sub-
stantially the labour cost of collecting and hauling the straw from the
fields following combining.
Milk used on farm:
The value of this varies mainly because of the different quantities re-
tained for farm use. This in turn varies with the size of the family. The
kind of calves raised is another factor and whether calves are from high
class expensive cows. The tendency is to feed such calves more whole
milk and for longer periods than where calves are of ordinary or grade
stock. In some cases calves are sold almost immediately after birth and
hence consume less milk. In other cases they are kept and sold as veal,
which entails feeding whole milk for about six weeks. Again the amount
of milk fed to calves depends on whether the calves are male or female.
Female calves are very apt to be raised and, therefore, fed milk. Male
calves are usually sold when very young.
Manure:
The value of manure varies depending on the kind or quality of feed
used, the kind of crop grown after the manure is applied, the type of
soil and the state of the soil at the time the manure is applied. In certain
regions, e.g., in Norfolk and Haldimand Counties, considerable manure is
actually sold. In such cases the value varies with the price received and
this in turn depends on the intensity of demand.
Depreciation and appreciation of cattle:
This factor in cost varies with the age of the cows and whether they are
still in the appreciation stage or have passed their highest producing point.
It also depends on the presence or absence of the various cattle diseases.
Serious disease infestation may cause even 100% depreciation. Where no
disease or serious accidents occur the average herd may show appreciation
rather than depreciation.
Increase and decrease in inventory:
This item varies particularly because of changes in price levels or cow
values between the beginning and end of the year; because cattle may
be sold or purchased during the year, and particularly because older cows
may decline in value and younger cows increase in value during the year.
Cattle sales:
Costs would have been much higher during the period under review
if it were not for the large number of cattle sales at the relatively high
prices prevailing. This credit alone amounted to 44c per 100 lbs. of milk.
In other words, had these sales not taken place, the average cost of
producing milk would have been $3.63 and not $3.19, exclusive of adminis-
tration allowance, as shown by the table of costs.
Production and test:
The average production of cows included in the herds covered by the
survey was approximately 7,800 lbs. per annum, which is above the average
for the Province. The average test was estimated at 3.45% of butterfat.
Administration allowance:
The producer is quite entitled to a return on his investment and an
equitable allowance for performing his function of management, as
APPENDIX 25 179
distinct from the labour actually required to operate his farm. In our
opinion a reasonable return would be approximately 15% of the average
net cost over the Province or 48c per 100 lbs. of milk produced.
Costs:
Following is a table showing various elements of cost summarized from
reports obtained through the limited survey made, and after taking into
consideration evidence of producers appearing before the Royal Com-
mission:
Average costs for the Province of producing milk
for the fluid milk market
Concentrates .94
Hay .50
Silage .31
Pasture .28
Total Feed Costs $2.03
Dairy Herd Labour 1 . 17
Depreciation .14
Hauling .22
Miscellaneous .48
Gross Cost $4.04
Credits:
Milk used on farm .16
Manure .25
Cattle Sales Less Cattle Purchases and Inventory Adjust-
ments .44
Total Credits .85
Average Net Cost $3. 19
Administration Allowance .48
Total Cost including Administration Allowance $3.67
Costs by districts:
Costs in the Kenora, Dryden and North Western Ontario districts are
estimated to be as follows:
Net Cost per 100 lbs S3. 97
Administration Allowance .48
Total cost $4.45
Hamilton and Niagara Peninsula districts:
Net cost per 100 lbs $3.47
Administration Allowance .48
Total cost $3.95
Costs in the Toronto area and in other parts of Ontario do not seem to
vary to any great extent and are approximately as follows:
Net Cost per 100 lbs $3.09
Administration Allowance .48
Total cost $3.57
Surplus milk:
It is quite obvious that whole milk sold at prevailing surplus prices
results in a loss to the producers. The price received rarely covers the
bare net cost, and does not allow anything for administration or return on
investment.
Concentrated milk producers and cheese m,ilk producers:
The forgoing remarks, which apply to the production of milk for the
fluid market, are generally applicable to the production of milk used for
180 APPENDIX 25
manufacturing purposes. Costs of the latter, however, are not so high
for several reasons and mainly because there is not the necessity for
maintaining all year round production.
Following are tables showing various elements of cost summarized from
reports obtained through the limited survey made and after taking into
consideration evidence of producers appearing before the Royal Com-
mission.
Average costs for the Province of producing milk
for the manufacture of concentrated milk products
Concentrates .73
Hay .46
Silage .20
Pasture .24
Total Feed Costs $1 .63
Dairy Herd Labour .92
Depreciation ,17
Hauling .12
Miscellaneous .29
Gross Cost $3. 13
Credits:
Milk used on farm .09
Manure .20
Cattle Sales Less Cattle Purchases and Inventory Adjust-
ments .29
Total Credits .58
Average Net Cost $2.55
Adminstration Allowance .38
Total Cost including Administration Allowance $2.93
Average costs for the Province of producing milk
for the manufacture of cheese
Concentrates .65
Hay .46
Silage .23
Pasture .28
Total Feed Costs $1.62
Dairy Herd Labour 1.00
Depreciation .11
Hauling .10
Miscellaneous .35
Gross Cost $3. 18
Credits :
Milk used on farm .21
Manure .24
Cattle Sales Less Cattle Purchases and Inventory Adjust-
ments .39
Total Credits .84
Average Net Cost $2.34
Administration Allowance .35
Total Cost including Administration Allowance $2.69
Observations and Conclusions
Every effort was put forth to secure costs of producing milk for cream
production. A number of producers co-operated to the best of their abihty
but the estimated costs obtained through the survey showed such tremen-
dous variations that no useful purpose could have been served by tabulat-
ing them. Little or no evidence as to costs was submitted at the hearings
APPENDIX 25
181
by individual producers, however, a brief was filed by the Ontario Cream
Producers' League which was helpful.
Due to the limited information on costs presently available to us we are
unable to say, with any confidence, what the average costs are for the
Province. The following table is simply an estimate and nothing more:
Estimated average costs for the Province of producing milk
for cream production
Concentrates
Hay
Silage
Pasture
Total Feed Costs
Labour
Depreciation
Hau.ing
Miscellaneous
Gross Cost
Credits:
Milk used on farm, manure, cattle sales. Inventory adjust-
ments, etc
Average net cost
Administration allowance
Total Cost 100 lbs. of milk
Cost ]v.'V pound of butterfat
( cents ;
55
66
31
128
.SI. 80
1.13
13
.10
.28
S3. 44
1.70
SI. 74
.30
S2.04
S .60
Necessity of Keeping Accounts
Dairy farming is a very important business. Costs and sales values have
mounted. It has become too complicated and risky to carry accovmting
details in mind.
We are quite aware that the average farmer has little spare time and
bookkeeping is difficult for him but good farm management is almost
always associated with the keeping and using of a set of farm accounts
and records.
It is very much in the interests of the individual producers that they
keep proper cost and accounting records and a few minutes spent each
day on the books approved by the Ontario Agricultural College will
provide a permanent record of the transactions and operations of the
entire year.
Respectfidly suhinitted,
JOHN S. ENTWISTLE,
Accountant, Royal Commission on Milk.
Province of Ontario.
Julv 26th. 1947.
APPENDIX 26
ILLUSTRATION OF METHODS WHICH MAY BE USED IN CALCU-
LATING CERTAIN MILK PRODUCTION COST ITEMS RELATING TO
DEPRECIATION ON COWS, BUILDINGS, EQUIPMENT AND DIFFERENT
METHODS OF LISTING MILK COST ITEMS IN GENERAL.
Methods of Calculating Depreciation on Cows
A variety of methods have been used to arrive at an annual depreciation
charge for dairy cows. Among the more common of these methods are
the following:
1. "The annual depreciation is computed by finding the probable differ-
ence between the cost or value of the cow when she first freshens or is
purchased and the price she will bring for beef when she is discarded.
For example, if a cow is worth $125 when she first freshens, then has a
useful life of 5 years, and finally brings $60 when sold for beef, the annual
depreciation will be one-fifth of $65 or $13". (From Morrison Feeds and
Feeding.)
2. First calculate the present-day value of the cow. Then assume that
the average life of a milk cow is 5 years. Divide the value as calculated
by 5 and the result is the annual depreciation. (This was the method used
by J. W. Hansen in the brief submitted on behalf of the Ontario Whole Milk
Producers' League.)
3. The Misner formula for depreciation:
Value of
cows
plus
Value of ) minus (Value of
plus
Value
at beginning
of
cows pur- )
(cows sold,
of
year
chased and)
heifers )
freshening )
for first )
time )
(eaten or
(killed for
(which
(indemnity
(was col-
(lected
(including
(value of
(hides
cows
on
hand
at
end
of
year
4. The value of cows and heifers at the end of the year, and cows sold
during the year, is deducted from the value of the cows and
heifers on hand at the beginning of the year or purchased during the year.
Any net decrease in the value of cows and heifers represents depreciation.
(This was the method employed by the Royal Commission on Milk in its
independent investigation of costs.)
5. Use the cow rather than the herd as the unit when finding costs. This
method assumes that the production of milk and the growing of young
stock are two separate enterprises. Only the cost of keeping the cows
actually in the milking herd is included. In other words the cost of growing
young stock to maintain the dairy herd is provided for by valuing freshen-
ing heifers at the current market price when they enter the herd.
Some Possible Methods of Calculating Depreciation on
Buildings & Equipment
Method 1— Depreciation is found by dividing the present value of each piece
of equipment by its probable years of usefulness. All estimates
to be made by the farmers.
Method 2— Calculate depreciation at a rate of 2V2 per cent of the origmal
cost of stone, cement, or brick buildings or 5 per cent in the
case of frame structures. This is the method followed by the
Dominion Income Tax authorities.
In addition to the above plans, one suggestion is that the rate of deprecia-
tion permitted should be raised so as to include an allowance for
obsolescence as well as depreciation proper.
[182]
APPENDIX 26 ^^^
FACTORS OR ITEMS IN COST
1. Feed and bedding.
2. Man labour.
3. Building charge (includes interest, taxes and depreciation on the part
of the farm occupied by the cows and by the feed for the dairy
herd.)
Repairs should also be included under this item or under
"miscellaneous".
4. Equipment charge (covers interest, insurance, depreciation and any
taxes on milk utensils or machinery, tools, etc.)
5. Cow charge (covers depreciation, interest, taxes and mortality risk
on the cows themselves.)
6. Cost of keeping the sire or bull service.
7. Miscellaneous (hauling costs, horse labour, vet. service, cow testing,
association fees, etc.)
Credits to he deducted
1. value of manure
2. value of calves
3. milk consumed on farm.
(from Morrison's book "FEEDS AND FEEDING", p. 577 & 8)
COST ITEMS OR FACTORS USED IN OHIO EXPERIMENT STATION
Bulletin 424
Concentrates:
Corn
Oats
Cottonseed meal or oilmeal
Bran and Middlings
Other concentrates
Total concentrates
Succulent feed (silage, roots, etc.)
Hay
Stover
Pasture
Total feed and Pasture
Straw bedding
Man labour
Building charge
Equipment charge
Interest on cows
Taxes and insurance
Depreciation on cows
Bull service
Overhead
Miscellaneous
TOTAL COST • -
Credits:
Manure
Calf
Total Credits
NET COST
COST ITEMS INCLUDED IN OHIO EXPERIMENT STATION BUL. 424
Feed and pasture
Straw bedding
Man labour
Building charge^
Equipment charge
Interest on cows
Taxes and insurance
Depreciation on cows
Bull service
Other
184 APPENDIX 26
From total of above which gives gross cost, credits' are subtracted to
obtain net cost.
' Equipment charges include all charges in connection with dairy equip-
ment such as cans, pails, strainers, stable equipment and milking
machines, a share of the total operating costs of water supply equip-
ment, lighting systems and feed grinders, and a share of the total cost
of operating farm automobiles and trucks used for hauling feed or
trucking cows. Milk hauling costs are not included.
' Other costs include overhead charges, cow-testing expenses, horse
work, medicines, disinfectants, veterinary services and advertising.
'^ Credits include value of milk used on farm, value of manure, value
of calves and feed bags.
APPENDIX 27
WHOLE MILK PRODUCTION COSTS
IN
HAMILTON-NIAGARA DISTRICT
INTRODUCTION
In making this analysis of whole milk production costs in the Hamilton-
Niagara district I have been prompted, and in a general way, guided by
my own experience during the past fifteen years. Beginning in 1932
with a holding of 100 acres in Ihs Waterdown area, since increased to 463
acres, with provision for a herd of 140 Ayrshires including some 70 milking
cows, I have continuously maintained farm and dairy accounts on a much
more detailed basis than I believe is common in the farm community
in general. I have also consistently employed the best type of farm help
available and have constantly sought and applied the advice of our field
and animal husbandry experts at Guelph and Ottawa. In short. I have
left little undone that I could reasonably do to operate my dairy farm in
an efficient, up-to-date manner. There may be some who contend that
farming in Ontario is not economically practicable on a modern, mech-
anized basis but this appears to me to be a policy of despair. I strongly
suggest that this viewpoint, if given any official cognizance, can only
result in our agricultural community becoming progressively a discounted
and under-privileged section of the national economy.
The inescapable evidence of my accounts is that the production of fluid
milk, at current prices to the producer and by any conventional standards
of judgment, is a highly unprofitable business. I hasten to point out, how-
ever, that in the present study I have not relied on my own actual ex-
perience as to costs, except insofar as, in their more favourable aspects,
they are confirmed by accepted authorities. To the extent that they are
more unfavourable than accepted or published standards, and might thus
reflect purely individual conditions, I have not referred to them or per-
mitted them to influence the following analysis.
In other words, I have attempted to make an impartial, impersonal
examination of the subject, based on self-evident or authoritative
information, admitting my own personal experience only as general
background knowledge and not as substantiating data.
THE FARM
FARM PRODUCTION
In the study of milk production in Ontario made by H. R. Hare, results
of which were published in March, 1942, by the Dominion Department of
Agriculture, the typical Hamilton-Niagara district dairy farm of the survey
was computed to be of 136 acres paying taxes of $188 per annum. I have
indicated on an attached sketch an allocation of this typical acreage de-
signed to provide a balanced operation in any particular year for milk
production purposes. This hypothetical farm constitutes the basis or back-
ground of the following analysis.
According to the Hare Report, based on the average of the years 1936-
39, yields per acre and total production of the typical farm can be reason-
ably computed as: —
Oats ( So . 34 bus. per acre )
Silage
Alfalfa
Timothy and Clover
[185 1
Tons
"The
Tons
per
Farm"
larm
acre
acreage
product
.6185
42
26
9 33
10
93.3
18
15
27
1.54
15
23
186 APPENDIX 27
FARM EXPENSE
Hired Labour
On the basis of a Man Work Unit (M.W.U.) of 1 man working 10 hours
the farm labour required to secure the above farm production will be: —
Type Work
Grain
Silage
Alfalfa
Mixed Hay
Pasture
Fences, etc
Allowing 250 M.W.U.'s per man per annum this will require .78 or, for
convenience, .8 man per year.
Presuming the man to be married and living in a farm cottage the hired
labour expense chargeable to Farm Account can then be tabulated as: —
Wage per month $105.00
House rental per month 12 . 00
Light and power 4 . 00
Fuel (3 tons coal and wood) 6 . 00
Milk (2 qts. per day at 7c) 4.20
131.20
12 months
M.W.U's.
No.
per Acre
acres
Total
2
42
82
5
10
50
2
15
30
1
15
15
.2
39
8
10
195 M.W.U'«.
$1,574.40 or 63c.
80% to Farm Account $1,259.50 per hr.
Workmen's Compensation 26.00
Total hired labour expense fFarm Account) $1,285.50
Labour Note
Some further evidence substantiating the foregoing farm hired labour
expense of $1,285.50 may be appropriate.
Assuming that a single instead of a married man is employed: —
Wage per month $65.00
Board 32.50
Perquisites (room, milk, add'l. heat, power, light) 7.50
Per month $105.00
12 months
Per year $1,260 00
At 250 M.W.U's. per year 2500 hours
Rate per hour 50J/^c
Most farmers, and certainly Hamilton-Niagara district farmers, are in
competition with the cities for labour. The current rate for the lowest
category plant labour (sweepers, etc.) is 65 cents per hour and this is
now in course of increase to 75 cents-80 cents as a result of strike settle-
ments. Farm trained help can invariably secure employment in higher
labour grades commanding still higher rates of pay. Furthermore, city
employment offers the powerful inducements of paid vacations and holi-
days, a legal 48 hour week, unemployment insurance and other advantages
so far denied to farm labour.
In the matter of farm working hours, I recently allowed 300 M.W.U.'s
per annum per man in an analysis of milk production costs submitted to
a leading economist of the Dominion Department of Agriculture. He
considered this to be high and indicated 250 M.W.U.'s to be reasonable and
proper. H. R. Hare ("Farm Business Management") states, however, that
APPENDIX 27 187
the normal labour allowances of M.W.U.'s per acre are for Direct Labour
only and do not provide for such Indirect Labour as care of horses, main-
tenance of buildings, implements, and machinery, upkeep of drains, bridges,
and fences, manure haulage, snow removal and the many other miscellan-
eous operations essential to good farm practice.
On my own dairy farm, which I have no reason to believe exceptional
in this respect, the men start work at 5.15 a.m. and hope to quit at 6 p.m.: —
Working Day (2 hours for meals) 10 hrs. 45 min.
6 days 64 hrs. 30 min.
Sunday 3 hrs. 30 min.
Week 68 hrs.
Year 3536 hrs.
or 353.6 M.W.U.'s
On the basis of this actual experience: —
Calculated single man rate of 50 1/2 cents reduces to 36 cents per
hour actual.
Calculated married man rate of 63 cents reduces to 44 V2 cents per
hour actual.
In face of city competition offering approximately double these rates,
the difficulty and, in the case of single men, the virtual impossibility of
retaining competent farm help is not far to seek. If the bare living re-
quirements, to say nothing of the wellbeing of the farm worker are to be
given any consideration whatever in the determination of farm production
costs and consumer prices I submit that a single man base rate of 60 cents
per hour or $85.00 per month is minimal and necessary to secure and hold
his services. As to the married man, the working year of 250 M.W.U's
and hourly wage rate of 63 cents used in determining the foregoing
typical farm labour expense are equally minimal and essential.
It is a reasonable assumption that the present pattern of 13c per hour
increase for industrial workers will shortly have to be reflected in farm
labour rates to preserve some semblance of balance between urban
and rural workers. Our married man rate of 63c per hour in that
event would have to be increased to 76c per hour for 2500 hours per annum.
In view of such hourly rates what is to be said of farm rates of the order
of "17.4c per hour", "20c per hour", "30c per hour", "$3.00 per day", etc.,
invariably appearing in official analyses of farm costs? (e.g. H. R. Hare:
"The Dairy Farm Business in Ontario"; Department of Agriculture; 1940:
W. Kalbfleisch; "Cost of Operating Farm Machinery in Eastern Canada";
Publication 750, Department of Agriculture; 1944.) The answer obviously
is that these rates, so far as they have any basis in reality, represent unfair
and depressed farm labour conditions relative to city labour, and for
general farm cost analysis purposes propagate misleading conclusions by
obscuring the real costs of farm labour.
FERTILIZER AND MANURE
Disregarding the recommended requirements for improvement or main-
tenance of permanent pasture (400 lbs., per acre every 3 years), the costs
of commercial and natural fertilizer to new seeding only for the 136 acre
farm may be stated as follows:
Grain 42 acres at 200 lbs 4.2 tons
Com 10 acres at 200 lbs 1 ton
5 . 2 tons at
$35.00— $187.20
Stable excretion per cow — 8 tons per annum (Reinforced
with static phosphate) — $2.00 per ton.
Assuming 25 cow units 25 x 8 x $2 400. 00
Total 587.20
(Note: Natural fertilizer cost of $400.00 later credited to Dairy Account).
IMPLEMENTS AND MACHINERY TO FARM ACCOUNT
Using team and tractor the estimated costs of machinery operation
reasonably necessary to work the 136 acre farm with the indicated crop
acreages, are tabulated below. These are derived from Publication No. 750,
APPENDIX li
Department of Agriculture: '"Costs of Operating Farm Machinery in Eastern
Canada"; W. Kalbfleisch; 1944. and subsequent correspondence with the
same source: —
'^'ears to Tons or
Approx. Obsolence Acres
Cost or Dis- Days per
New card "S'ear
250
900
172
160
130
25
120
29
:io
10
15
15
15
15
22
25
60
60
60
40
20
40
50
40
Tillage
Horses i2) (see tabulation
below)
Tractor CI plow)
Disc Harrow
Cultivator
Tractor Plow CI furrow)
Walking Plow
Roller
Harrow
Seed i Hi:.
Grain Drill
Harvestirifi
Mower ( horse )
Rake ( side )
Hay Loader
Com Binder ( power & loader )
Combine
General
Manure Spreader
Wagon (two)
Racks i two)
Sleigh
Fanning Mill
Mi?c. & Spare Parts
Operating cost per acre (farm operation only) 136 acres S6 60
Investment \ytv acre ' farm operation only) 136 acres 30 50
Nok:
Horses (Basis: Publication No. 750. Department of Agriculture:
(W. Kalbfleisch: 1944 and incremented prices.)
Feed Cost
Grain 2500 lbs. at 2c per lb
Hay 3 tons at 818 per ton
Pasture and Fencing 3 acres at SIO
Bedding '§ ton at $6.00
Man Labour 75 man hours at 50c
Fixed Costs
Depreciation 10' , on 8125 valuation
Interst A'", on one half the value
Buildings
Shoeing
Veterinarian
Harness — Cost per year
Total Costs
Credits — Manure 8 tons at 82 . 00
Net cost per horse per year
Net cost per team per year
Est.
Cost
per
.Acre
29
26
30
44
24
20
05
.49
Cost
per
'^'ear
8373 76
197.90
15.60
18 00
17.60
4.80
8.00
2.50
19.60
126
20
40
.31
12 40
172
20
40
.33
13.20
218
20
100
.21
21.00
400
15
10
4.14
41.40
500
15
40
1 .52
60 80
200
18
200
10
20 00
220
25
80
.12
9 W
75
25
40
.10
4 00
85
25
20
20
4 00
55
25
•>
1 85
.3 70
100
10.00
84147
853.86
Fire
<.<: Liability
Ins
46.14
8900.00
.850 00
54.00
30 00
3.00
8137 00
12.50
2.50
6.00
2.75
.63
837 50
824.38
5.00
S203.88
16 00
8186.88
S373 76
70.00
12,00
67.00
50.00
52.40
90.00
50.00
90.00
272.00
32.00
APPENDIX 27 189
OTHER FARM EXPENSES
Gas and Oil
One tractor in use 60 davs at S3. 83 per dav ( Dcpt.
Agric. Publication No. 750j S229.80
Seed
Grass and legume
Com, hybrid
Grain, 42 acres at 2 bus. — 84 bus. at .80c
Tlires/iin^
Combine — no charge
Ensilinii
Equipment only with operator
Fences, Bri\I^cs. L rains, etc
Automobile ( farm business only) 1500 miles at 6c
Miscellaneous and General
Taxes (land onlyj
Interest
Land $.50. 00 per acre— S6800. at A%
Implement shed and shop — $800. at 4Vc
I)isurance
Implement shed (replacement value $2000j (at 50c per
$100) 10.00
SUMMARY OF FARM EXPENSE
Labour $1,2^5 . 50
Fertilizer and Manure 587. 40
Implements and Machinery 900 00
Gas and Oil (tractor) 229.80
Seed 149 00
Ensiling 50.00
Fences, etc 52 . 40
Automobile use 90. 00
Miscellaneous and General 50 . 00
laxes MOO
Interest 304 . 00
Implement Shed Insurance 10.00
Total Farm Expense $3.798. 10
ALLOCATION OF TOTAL FARM EXPENSE TO FARM PRODUCT
Having arrived at the above total farm expense in respect of 136 acres,
it will be of interest to determine a proper allocation of this expense to
the previously indicated farm production.
Some of the items of farm production are generally marketable and
consequently have established market values or alternatively have accepted
conventional values which may reasonably be used. Other farm products,
not being generally marketable and hence having no established market
price are usually, for milk cost analysis purposes, included at "farm prices".
Just how these "farm prices" for products without established commercial
value are arrived at has never been clear to me. I can see no other way
of arriving at the real costs of these products than by treating them as
residual to the known or conventionally accepted costs or values of the
other products. In other words, the total farm expense being known and
a proportion of the expense being allocated to certain products on the basis
of their commercial or accepted values, the remainder of the expense
must necessarily be attributed to the remaining products if it is to be
comprised in ultimate milk costs or recovered in eventual milk receipts.
Thus, segregating the actual or conventionally marketable products of
our farm yield we may justifiably assign to them due proportions of total
farm expense as follows:
Qtv. \alue Total
Oats 26 tons .$,38. 00 ,$988. 00 f L.C.L. Oct. 15th, 1946)
Straw 42 tons 6 00 252 . 00 (Conventional)
Pasture 39 acres 10. 00 390. 00 (Conventional) ■
$1,630.00
Residual farm expense
(.S3798— $1630) .$2,168.00
190 APPENDIX 27
This residual farm expense can only be attributed to the remaining farm
product, namely silage and hay. A commonly accepted ratio of value of
silage to hay is 1 to 2, or as a generalization silage is of half the value
of hay. Allotting the residual farm expense of $2,168.00 to these products
in this proportion we get: —
Silage .
Hay..
Farm
Qty.
Expense
Cost
93.3 tons
$1,044.00
$11.20 per ton
50 tons
1,125.00
22 . 50 per ton
These indicated costs per ton of silage and hay are far in excess of any
"farm prices" used in any whole milk cost analysis of which I am aware.
The highest costs previously computed for silage and hay, to my knowledge,
are $4.57 and $10.22 per ton respectively as against $11.20 and $22.50 per
ton in the present instance. In the Hare preliminary report on dairy farm
business in Ontario 1940. +he average pricec charged in the Hamilton-
Niagara district in determining milk production costs -^-ere, silage $4.57
per ton and hay $8.50 per ton. These prices were explained as being "at
local market prices less the cost of hauling to that market" or in other
words they were the prices at which silage and hay could presumably be
sold at the barn. In point of fact there is no "market" for silage in the
commonly accepted sense that definite commercial prices are established.
Silage feeds by their bulk and nature are, for all practical purposes, non-
marketable or marketable only to a negligible degree. The practical
necessities of dairy farming require that silage and hay be home-grown
and for this rraoon they must be regarded as an integral part of the dairy
farm operation and not as marketable by-products. As such, they must
in any analysis of milk production costs be charged with the whole actual
expense incurred in delivering them to the barn for dairy use, regardless
of any presumptive sales or market values.
As a further example of this. Department of Agriculture Publication
No. 750, W. Kalbfleisch, 1944 in calculating horse labour costs estimates hay
at $6.50 psr ton, bedding at $4.00 per ton and pasture and fencing at
$2.50 per acre. By comparison with these figures my "conventions" of
$6.00 per ton for straw and $10.00 per acre for pasture appear inordinately
high. But it must be noted that if these values are to be reduced the
residual farm expense attributable to silage and hay becomes propor-
tionately greater and the discovered cost per ton of $11.20 and $22.50
respectively for these products must be placed still higher. To reduce the
stated values of straw and pasture without correspondingly increasing the
costs of silage and hay would be merely to evade or ignore the real costs
incurred.
This same official and comparatively recent Publication costs grain at
Ic per lb. and labour at 20c per hour. Using various costs or values set
forth in this brochure I have calculated that the gross value of the esti-
mated production of the typical 136 acre farm would be $1,413.50. But
it has already been demonstrated that a total expense of $3,798.10 will
be incurred, under present-day conditions, in securing that production.
The total farm income then, on the basis of official costs or values such
as Ic per lb. for grain, $6.50 per ton for hay, $4 per ton for bedding and
$2.50 per acre for pasture is little more than one-third the estimated total
farm expense. Since I can find no justification for any reduction in any
of the items comprising this expense, I can only conclude that the fore-
going costs or values of the official Publication represent, in fact approxi-
mately one-third the real costs or values of these farm products, at least
in the Hamilton-Niagara district. That they are not even approximately
representative of real costs is, I believe, self-evident to any farmer who
has the most rudimentary sense of his farm expense. Such wide disparities
between official information and the grim realities of farm costs seem to
call for explanation and certainly engender misconceptions in the minds
of many farmers as well as in the comprehension of the public.
Virtually all whole milk cost studies, after failing to deduce or discover
any adequate net return or "living" for the average dairy farmer, inevitably
reach the conclusion that he can and does continue to exist only by
"taking it out of his own hide" or by "living off his depreciation and
interest". Undoubtedly this conclusion is right. The regrettable fact is
APPENDIX 27 191
that these very studies;, while sincerely intended to advantage the farmer,
are actually tending to perpetuate this condition. They do this in general
"by analyzing the dairy jarmers circumstances in light of the prevailing
rather than the required price of milk to the consumer, and in particular
by failure to recognize and include the real costs of home-grown dairy
feed at the ham.
If milk cost analyses show, as they do, that the average dairy farmer's
receipts at current milk prices do not exceed his production costs to the
extent of an adequate "living" then some elements of his production cost
are obviously being priced at too lov/ levels. I submit that this is
evidently the case with regard to home-grown roughages and succulent
feeds.
For present purposes, the foregoing does not in any event, affect the
main issue of determining final milk costs to the farmer. It does serve
to point up what I believe to be a vital underlying fallacy in all milk
cost studies, oflficial or otherwise, of which I am aware. However, the
total farm expense of $3,798.10 having been demonstrably incurred for
feed, bedding and pasture it must necessarily be carried forward in whole
to Dairy Account, regardless of its allocation to farm product.
Balance of Farm Product and Farm Stock
Before proceeding to an analysis of dairy costs it would be appropriate
to conclude the farm analysis with a determination of the balance of
the overall operation, that is, to ensure that the farm plan and product
previously indicated provide an adequate but not excessive source of
supply for the dairy operation.
To determine the total of home-grown feed available for the dairy herd:
Oats. .
Silrige .
Hay..
Total
Tons
Horses
Tons
Bull
Tons
Available
Tons for Herd
26
93.3
50
2
3
1.5
2
22.5 (add 10% oil cake) 24.7
93.3
45
On the basis of various authorities and experience I believe the following to be
a reasonable statement of feed consumption per animal: —
Cows Assume milk production 7600 lbs. per annum 4% b.f.
Housed 7 months or 210 days Hay — 123^ lbs. per day —
210 + 30 summer feed 3,000 lbs.
Silage— 30 lbs. per day 210 + 30 summer feed 7!200 lbs!
Concentrate — at 4 lbs. milk to 1 lb. concentrate 2,000 lbs.
Heifers Over one year. Bam feed 7 months.
Hay— 10 lbs. per day 210 days 2,100 lbs.
Silage— 15 lbs. per day 210 days 3,150 lbs.
Concentrate — 3 lbs. per day 210 days 630 lbs.
Heifer Calves 6 — 12 months.
Hay— 3 lbs. per day 240 days 720 lbs.
Concentrate 500 lbs
Assuming for the moment a reasonably differentiated herd (the bull being already
provided for) of: —
Cows 20
Heifers (12-30 months) 12
Calves ( 6-12 months) 4
Calves ( 1-6 months) 4
then on the basis of the previous estimate of consumption per animal the total
feed requirements will be: —
Lbs.
Lbs.
Lbs.
Hay
Tons
Silage
Tons
Ration
Tons
Animals
No.
Each
Hay
Each
Silage
Each
Ration
Cows
20
3,000
30
7,200
72
2,000
20
Heifers . . . .
12
2.100
12.6
3,150
18.9
630
3.7
Calves
8
Hay.
720
3
500
2
45.6
Silage. . . .
90.9 Ration...
25.7
1"^- APPENDIX 27
Balancing these feed requirements for the above herd against the previously
determined available feed we get : —
Available Required Residue
Hay 4o tons 45 . 6 tons — . 6 tons
Silage 93.3 tons 90.9 tons 2.4 tons
Concentrate 24 . 7 tons 25 . 7 tons — 1 tons
It is thus evident that, v^ithin very narrow margins of tolerance, the
farm plan and product indicated and the aforesaid dairy herd constitute
a properly balanced and practical dairy farm operation.
THE DAIRY
It has been established that the typical dairy farm of 136 acres will
support a herd of: —
Cows 20
Heifers (12 to 30 months) 12
Calves (6 to 12 months) 4
Calves (1 to 6 months) 4
Value of Herd
For the purpose of certain subsequent determinations it is necessary to
arrive at a proper valuation of the above herd. This is a further respect
(the real cost of growing dairy animals through various stages to milking
age) in which I believe most farmers and many authorities rely heavily
upon inspired or instinctive guesses. In the present instance, therefore,
I have evaluated the typical herd "from the ground up" in the following
way : —
(Basis) — Cost to raise dairy heifer to milking age, av. 2 years, 6 months.
Assume calf to be born in May, calving in November.
Period 1 — 12 months
Calf value $5.00
Milk 300 lbs. at $4.91 14.73
Calf startena 17.60
Ha v. 240 days at 3 lbs— 720 lbs. at S22 . 50 8.10
Ration 500 lbs. at $40 per ton 10. 00
$55.43
Labour. 2 M.W.U's.— 20 hrs. at 63c 12.60
Bedding 2 lbs. per day 365 davs at $6 Ton 2 . 20
Housing 2.00
Miscellaneous 3 . 00
Cost to 12 months $74 . 23
Period 12—30 months
Pasture yearling, 5 mos. at $2 10.00
Winter 210 davs —
Hav 2100 lbs. at $22.50 23.60
Silage 3150 lbs. at $11.25 17.45
Ration 630 lbs. at $40.00 12.60
Pasture 2 vr. old 5 mos. at $2 10 . 00
Ration ,300 lbs. at $40.00 6.00
$79.65
Labour 3 M.W.L's. for U •> vrs. at 63c 18 90
Housing 2.00
Miscellaneous 5 . 00
Bedding, 240 days at 8 lbs. — 1920 lbs. at $6 5 . 75
Cost 12 to 2,0 nionll/s $111 .30
Cost 1—12 months $74.23
Cost 12—30 months Ill .30
Cost to raise to a vera fie )tiilkin'i age $185.53
APPENDIX 27 19-^
{SiiinDiary) <S calves in Herd (I to 12 nioutlis)
Rjisf Pricp oi C7i\\ *^^
Cost to raise to l^'nionths (S74.24— $5.00) S69.08.
Average (6 month i value S69.08 + $5. =839.54 .\ 8 8316.32
2
12 Heifers in Herd i 12 la .10 months)
Base cost of heifer at 12 months. 874.23
Cost to raise 12 — 30 months 111.30
Average (21 month) value
8111.30 + 874.23 =8219.88 .\ 12 81,538.56
2
20 Cows in Herd
Average cost to raise =8185.o3 x 20 3.710.60
85.569.16
Bull 200.00
Herd Value 85,769.16
Depletion of Herd
Since milk production and receipts must be constantly maintained if
the business is to continue and our analysis to be valid, the first costs
to be considered in the dairy operation are those incurred in offsetting
natural depletion. This, in effect, is a question of the disposition of the
.young stock.
In agricultural circles there is a wide acceptance of 5 years as the average
productive life of a dairy cow. However, Bulletin 341 of the U.S. Depart-
ment of Agriculture finds that this average life ranges from 3.6 to 4.5 years
in widely separated areas of the Eastern and Middle Western States.
Furthermore, recent average annual milk production for more than 22
million cows in the United States was no more than 4,510 lbs. This is far
short of the average of 7,600 lbs. of 4% milk presumed for the purposes of
this analysis. The additional production can be secured only by stringent
herd culling and high feeding. Excessive feeding notoriously accelerates
herd mortality. Both these factors then operate to reduce the average
productive life in a dairy herd. I am confident that the 3 year estimate
of some authorities as the average productive life in a herd bred, culled
and fed for high production is closer to the mark and I am very certain
that my own record over a fifteen year period is still less favourable. When
we consider the cumulative possibilities of herd depletion arising from
Bang's storms, mastitis and non-bieeding I believe and my own experience
rnore than confirms that an estimate of 4 years maximum average produc-
tive life is entirely warranted and conservative.
It follows from this that our herd of 20 cows will be naturally depleted
by 5 animals during a year of operation. Disposal of these to butcher or
bone-yard at an average of $80 each will be later credited against dairy
expense.
The disposition of young stock is complicated, in theory as in practice,
by the necessities of maintaining milk quotas. However, if we assume for
simplicity that the 8 calves of the herd are retained until grown, a further
3 animals are available for disposal. These also will be later credited
against dairy expense at $200 each.
An estimated natural increment of 12 calves available for sale at $5 each
will also be later credited to the dairy operation.
Having thus provided for herd maintenance v^'ith due credits accruing to
dairy account it remains to provide for the costs of bought feeds before
proceeding to consider other dairy costs.
Concentrate— 2 tons, oil cake $100.00
Calf feed— Startena, 8 calves, $17.60 140.80
Bought feeds expense (dairy account) $240.80
Labour Expense
According to Cornell University Bulletin No. 539 total manpower require-
ments for 136 acres supporting 20 cows, 12 heifers and -8 calves will be: —
194 APPENDIX 27
M.W.U's.
per Head Total
20 cows, majority purebred 20 400 M.W.U's.
20 heifers and calves 2 40 M.W.U's.
Dairv 440 M.W.U's.
Farm 195 M.W.U's.
Total 635 M.W.U's.
That is —
2 men at 317.5 M.W.U's. each.
or 2.5 men at 250 M.W.U's. each.
In practical terms this indicates that 3 men will be required in the
6 summer months and 2 men in the other six months. Eliminating for
present purposes the labour contribution of the owner, the total hired
labour requirement is 1.5 men averaged over the year. Of this labour
.8 man per annum has been found necessary for farm operations, leaving
.7 man per annum as the hired labour requirement for dairy operation.
Hired labour expense to dairy account may therefore be expressed as: —
.7 man x 250 M.W.U's. x 10 hrs. x 63c per hour $1,102.50
Workmen's Compensation 23.00
Total hired labour expense (dairy account) $1,125.50
Buildings and Equipment
It is believed that the following represent very conservative estimates of
dairy farm building and equipment values as a basis for calculation of
interest and depreciation. No costs in respect of a farm house are included
and building values are taken at depreciated levels representing a mere
fraction of their current replacement values: —
Barn. Calf Bam. Silo $5,000.00
Interest (S5,000 at 4%) $200.00
Depreciation ($5,000 at 37c) 150.00
Insurance (on 90*^ r of estimated replacement
value of $12,000) 54.00
Taxes 60.00
Maintenance 100.00 $564.00
Well pump and water system •: . $350.00
Refrig. unit with tank 300.00
Milking units and piping 500.00
Grain roller and motor 150. 00
Cooler and circulating pump 110.00
Litter carrier and tracks 100.00
Feed truck 60.00
1,570.00
Interest (half value at 4%) $31 . 40
Depreciation ($1,570 at 10 %) 157.00
Insurance 7 . 50
Maintenance 80.00 $276.00
Veterinary Service and Medicine $100.00
Aulo7vobile (3,000 miles at 6c) $180. 00
Miscellaneous
Telephone (dairv use) $20.00
Power and light 96.00
Disinfectant, spray, etc 30.00
Stable phos. (2 tons) 60.00
Registrations, transfers, R.O.P. costs 60.00 $266.00
Interest and Insurance on Herd
Value of Herd $5,764.00
Interest at 4% $230.00
Insurance ('at 50c per $100) $28.80
APPENDIX 27
195
RECAPITULATION OF TOTAL FARM AND DAIRY EXPENSE
Labour (Hired i
Fertilizer and manure
Implements and machinery.
Gas and oil
Seed
Ensiling
Fences, bridges, drains, etc.
Automobile use
Miscellaneous
Taxes
Feed (bought)
Barns
Vet. and medicine
Interest at 4%
Insurance
$1
Total Farm Expense $3,798. 10
Farm
,285.50
587.40
900.00
229.80
149.00
50.00
52.40
90.00
50.00
90.00
304.00 (farm)
10.00 (imp.
shed)-
Dairy
81,125.50
276.00
180.00
266.00
60.00
240.80
564.00
100.00
230.00
28.80
$3,071 . 10
fherd)
(herd)
Total
$2,411.00
587.40
1.176.00
229.80
149.00
50.00
52.40
270.00
316.00
150.00
240.80
564.00
100.00
534.00
38.80
$6,869.20
Credits:
5 cows at $80
3 animals at $200
12 calves at $5
Manure
730 qts. milk at 7c (owner).
$400.00
600.00
60.00
400.20
50.40
$1,510.60
Total farm and dairy expense.
MILK PRODUCTION
20 cows — average 7600 lbs
Deduct for farm use: —
Calves (8 X 300 lbs.)
Owner and help (4 qts. x 365 days).
2,400 lbs.
3,650 lbs.
$5,358.60
152.000 lbs.
6,050 lbs.
Net saleable milk production .
145,950 lbs.
MILK COST
Milk Production
1,460 cwt
Net cost per cwt .
Haulage
Total
Expense
$5,358.60
$3.67
.25
$3.92
It will be recalled that in arriving at the total dairy farm expense
nothing has been included as return for the labour of the ov^ner, who
has been estimated as contributing a full year's work. Similarly, nothing
has been provided for his housing or managerial effort. His only return
from milk at $3.92 per cwt. is two quarts of milk per day.
If we assume, for lack of any other criterion and because it represents
a very conservative not to say grudging premise, that he is entitled to the
same return for his labour as his hired help we may then state the resulting
cost of his saleable milk production as:
Total
Milk Production Expsnse
1.460 cwt. Farm and dairy expense $5,358.60
OwTier's labour (250 M.W.U's. at
63c) 1,574.40
$6,933.00
Cost per cwt $4 . 75
Haulage .25
$5.00
196 APPENDIX 27
As a check on the general accuracy of this finding we may apply the
widely accepted Misner formula for determination of cost of 100 lbs. of
milk/ using the labour rate and home grown feed costs previously
established: —
Hamilton-Niagara Milk Cost
Formula of Professor E. G. Misner
30 lbs. of dairv feed and concentrate at $2. 15 per cwt .65
100 lbs. of silage at S11.20 per ton .06
60 lbs. of hay at $22.50 per ton .67
Total feed cost SI . 88
3 hours of labour at 63c per hour 1 89
Total feed and labour cost S3 . 77
Cost per cwt. at farm, including interest and depreciation (3.77 ;•: 100'. ... 4.71
80
Haulage 2o
Actual cost production and delivery S4.96
This close coincidence of results, obtained in one case by application of
an accepted general formula and in the present case by a detailed analysis
"from the ground up", constitutes strong support of the validity of the
analysis. In particular it supports the determinations of 63c per hour for
labour and $22.50 and $11.20 per ton respectively for home-grown hay
and silage, these being the factors which, in this or any farm analysis,
are most open to variable estimation.
It must be noted that the discovered cost of $5.00 per cwt. for milk in
the Hamilton-Niagara district still does not make any allowance for the
owner's management effort. It provides him and his family only v/ith a
living on the level of wellbeing of his own hired help or of the lowest paid
category of industrial workers. Not to pursue the matter further, the
evidence of this analysis is, that to the extent that the Hamilton-Niagara
district dairy fanner receives less than $5.00 per cwt. for whole milk he
is living at a relatively sub-standard level of existence or alternatively he
is living off his temporarily '"escapable" costs such as interest, depreciation,
maintenance, etc., or in other words, off the depletion of his physical and
capital resources.
Anyone familiar with farm life throughout Ontario knows that this is
no mere theoretical deduction but an evident matter of fact. Soil erosion
and depletion, neglected pastures, dilapidated buildings, inferior living
conditions and many other evidences of insufficient capital recovery and
reinstatement, to say nothing of deserted farms, are the rule rather than
the exception.
This is a condition which, in the nature of things, can not continue
indefinitely. Some readjustment or reaction is inevitable. Already there
are signs of this in the fact that many larger scale dairj' farmers, more
immediately alive to unfavourable cost though not necessarily having a
detailed knowledge of their nature, are "getting out of the business" in
whole or part. I sincerely regret to say that I am to be numbered among
these.
It might be contended that the elimination of the larger more specialized
dairy farmer is a desirable readjustment in the present circumstances,
permitting an easement of the price situation by a reduction of supply
and by a reliance upon "low-pay", "no-profit" sources of production. As I
have said before I believe this to be a policy' of despair, which can only
result in the segregation of the dairy farm community as a low-standard,
underprivileged and depressed economic group. I believe that any con-
sideration of whole milk costs or prices based on such a conception is. in
effect, discriminating against the farmer by setting up unique and unprece-
dented standards of economic judgment for his case and will, furthermore,
constitute a positive disservice not only to the farmer but to the country
at large.
APPENDIX 27
197
CONCLUSION
I am fully alive
to the fact that
some of the data
set forth here may
be open to other
estimation in de-
tail, but I do not
know of any re-
si>ect in which they
can be so substan-
tially modified as
to materially im-
pair the conclusion
reached. In this
connection it should
be pointed out that
n o consideration
has been given to
the matter of main-
taining milk quotas,
a factor variable in
accordance with
prevailing indi-
vidual c i r c u m-
stances, or to hous-
ing of the farmer
and his family or
to his management
effort or to the mis-
cellaneous labour
not included in the
normal labour al-
lowances. These, if
given any consider-
ation, would still
further confirm the
finding of this an-
alysis that the true
cost of producing
100 lbs. of whole
milk in the Hamil-
ton - Niagara dis-
trict, under present
conditions, is S5.00
— or more.
"TEE FARM"
Approx, Scale:- 1 inch = 400 ft.
— lb 76 - o
MIXED HAY
15 acres
GRAIN
5 acres
STEADING
5 acres
HIGHWAY
H.R. HARE:-
Average Farm
Hamilton-Niagara District 136 acres
Assume Bush
" Permement Pasture
Adjusted acreage
Steading
Crop acreage
10 acres
34 "
103 ••
5 "
82 "
APPENDIX 28
SUGGESTIONS TOWARD ASCERTAINING PRODUCTION COSTS
It is obvious that a knowledge of production costs provides a valuable
guide when prices ai-e being negotiated or determined. One of the reasons
for the relatively weak bargaining powers of the producers has been lack
of accurate knowledge in respect of this. If producers are to receive
satisfactory remuneration for their product, prices paid must bear some
relation to costs, and the fixing of prices is obviously also very important
in ensuring sufficient supplies of fluid milk. The following suggestions
briefly outline methods which might be sufficient for the purposes of the
Milk Control Board:
1. The first step in securing cost information should be to undertake
a detailed study in which a large and representative body of pro-
ducers would keep actual cost records under whatever amount of
supervision might be found necessary. Such a study might well
follow the general pattern laid down in connection with the Hare
study of 1936-39.
2. The information secured in this study should be used to calculate a
formula showing the quantitative requirements of the several cost
items. This formula could then be used to calculate the costs existing
at later periods.
3. In order to provide a continuous check on the accuracy of the costs
resulting from use of the formula, the Board should follow up the
original study with one which would become continuous but which
would be based on records from a relatively small number of farms.
This study would be designed to provide a running record of the
changes in the kinds and amounts of the various items used in
milk production. For this purpose it is felt that the records of a
small group of producers would suffice to give a representative
picture of the changes taking place. Revision of the formula in the
light of this continuous study should provide a continuous supply
of reasonably accurate cost figures, at a relatively small expenditure.
4. Where milk production is only one in a considerable list of farm
enterprises and where, as a result, it is practically impossible to
calculate costs of milk production with any semblance of accuracy,
consideration should be given to calculating the total net farm
income. In such cases net income could be substituted for costs as
an index of economic well-being. This situation prevails in respect
of most of the creamery patrons.
5. In making the detailed cost studies here indicated the Board make
every attempt to select producer-co-operators who are already
accustomed to keeping accounts and convinced of the wisdom of
doing so. To the extent that such producers can be found the amount
of supervision required can be reduced while the accuracy of the
data secured can be increased.
6. All producers of milk should be encouraged to keep continuous
records of their costs independently, to the end that more efficient
production may be gradually effected.
[198]
APPENDIX 29
ROYAL COMMISSION ON MILK
INDEX TO ACCOUNTANTS' REPORT
SURVEY OF CHEESE MANUFACTURERS
LOCATED IN THE PROVINCE OF ONTARIO
Related Page
table Description Number
Assignment, approach and procedure 199
Industry background 199
Approach and procedure 200
Overall operating results for the fiscal year next preceding October 1st,
1946 201
Operating results — cooperatives o\vned independently of cheese
milk producers 201
Operating results — cooperative factories owned by cheese milk
producers 201
1 Operating results — entire cheese manufacturing industry 202
Financial position 202
Selling prices of factory cheese 202
Marketing methods 203
Earnings of cheese factories 1946 203
Outlook for 1947 203
Observations and conclusions 203
Possible increases in sales revenue 204
Possible savings and economies 204
Statistical data 204
Accounting records 204
Productive capacity 205
Changes in ownership 205
Marketing methods 205
The Honourable Justice Dalton Wells,
Commissioner,
Royal Commission on Milk.
Accountants' Report
Survey of Cheese Manufacturers
Located in the Province of Ontario
Sir: —
In submitting this report, reference should be made to the decision of
the Dominion government to terminate subsidies to the cheese industry
on April 30 last and to permit an increase in price at the manufacturers'
level of three cents per pound of cheddar cheese (equal to 4 cents at the
consumer level), as from May 1, 1947. The announcement was made as
our assignment M'as approaching completion.
Such measures were of much importance following several years of price
control regulations and it is expected that they will have a favourable effect
on the earnings of cheese manufacturers for the current year.
Assignment, approach and procedure
Assignment:
Having regard to the provisions of the Order-in-Council dated October 1,
1946, we were required to investigate and report on the operations of cheese
manufacturers located in the Province of Ontario with particular reference
to costs, prices, price spreads, methods of financing and methods of
management.
In connection therewith it is thought that a brief reference to a few
of the more important features of the industry might facilitate your
conclusions.
Industry background:
The industry is actively represented by a trade organization known as
The Ontario Cheese Producers' Association with a membership approaching
25,000 producers.
[199]
200 APPENDIX 2!:)
Since 1939 the production of cheddar cheese has increased very substan-
tially, the peak being reached in 1942 when the output for Ontario
approached 128 million pounds. In the years prior to the war, pi'oduction
approximated 85 million pounds per annum.
About 60 million pounds or two-thirds of the cheddar cheese produced
in the Province was exported in 1946 principally to Great Britain. This
represented about 60% of the total cheese exports of the Dominion.
During 1946 approximately 92 million pounds of cheese were produced
in Ontario having a value in excess of 20 million dollars at the whole-
sale level.
Factory cheese accounted for 24% of the total whole milk production
of the Province or about 15% less than fluid milk requirements, as shown
hereunder.
Allocation of estimated poinids of whole miffc
produced in Ontario for 1946
1946 1945
pounds of '~; of total '7 of total
Finished product whole milk whole milk whole milk
Factor V cheese 91 .978.000 lbs.
Creamery butter 68.785,800 l>-s.
Fluid milk 467.736.000 qts.
Fluid cream 13.519.000 qts.
Condensed whole milk. . 14.765.700 lbs.
Evaporated milk 98.063.700 lbs.
Powdered whole milk .... 14.535.200 lbs.
1.030.153.600
23.62
26.94
1.610.275.600
36.92
38.47
1.206.758.900
27.67
23.09
148.709.000
3.41
2.89
,33.665.800
.77
.77
215.740.100
4.95
4.83
116,281.600
2.66
2.41
Totals 4.361.584,600 100.00 100.00
Of the 600 cheese factories located in the Province only about 30 are
operated independently of the cheese milk producers to the extent that
they actually buy the cheese milk, process it, and dispose of the finished
product entirely as they see fit. The remaining 570 factories are operated
on a cooperative basis and may be divided into two classes, viz., those
owned by cheesemakers who contract with the cheese milk producers to
process on a fee basis, and those which are owned by the cheese milk
producers themselves who share in the excess of revenues over expendi-
tures, on a pro rata basis, at the close of each season.
The industry is of a seasonal nature, most cheese factories concentrating
on production during the summer months when supplies of whole milk
are at a peak.
Approach and procedure:
Of the 600 cheese factories located in the Province a fair representative
proportion were asked to submit financial statements relating to the fiscal
year next preceding October 1. 1946, also estimates of net profits for the
current fiscal year, before provision for income and excess profits taxes.
Those selected included the two types of cooperatives as well as in-
dependent cheese factories.
Generally speaking the standard of the financial statements was not as
satisfactory as was anticipated, particularly those relating to the coopera-
tives, many of which merely comprised a list of expenditures in chrono-
logical order with little, if any. indication as to the nature of the expense,
the payee's name and date of payment providing the only refei-ence.
Following a review of the financial statements, a representative group
was selected for the purpose of completing a form of questionnaire. Here
again, however, the resoonse was not as comprehensive as was hoped for,
a number of concerns being unable to furnish certain of the data even
though consideration had been given to the ability to complete in making
our selection, as well as other factors.
As with other sections of the milk industry, code numbers were employed
throughout the survey to ensure privacy and facilitate handling. A con-
siderable amount of correspondence and personal consultation was involved
in obtaining a sufficiently satisfactory coverage for the purposes of this
report.
APPENDIX 29
Overall operating results
jor the fiscal year next preceding October 1, 1946
Ontario cheese sales for the twelve month period totalled 116,093,000
pounds comprised as follows:
Cheddar . . .
Other
Farm made .
Cents
Quantitv
\'aluc
per ix)und
115.201.000
S24.%0.000
21.67
736.000
199.000
27 04
156.000
33.000
21.15
116.093.000 S25.192.000 21.70
It will be noted that cheddar cheese sales represent more than 90%
of total. , ,
The values and unit prices shown are at the wholesale level as reported
by the Dominion Bureau of Statistics. The average price received by the
cheese manufacturers during the year, combining all grades, was 20 cents
per pound F.O.B. factory shipping point, the difference between it and
the wholesale price of 21.70 cents representing freight, storage, com-
mission and other handling charges.
Operating results- — cooperatives owned
independently of cheese milk producers:
The fees, salaries, or other charges for services made by the independent
cooperative factories for the conversion of cheese milk into cheddar cheese,
during the year under review, ranged from 2 cents per pound of finished
product to almost 3 cents per pound. In addition to this the processors,
in some cases, participated in the revenues from whey, butter, and cream
sales, depending, of course, on the terms agreed upon with the local
cheese milk producers.
This revenue, combined with the Dominion and Provincial subsidies,
appears to have been sufficient in most instances to cover all processing
costs including cheesemakers' salary and bonus, operating supplies and
expenses, including depreciation, and still leave a reasonable surplus to
compensate the factory owner for his supervisory services and provide
some return on the capital invested in the factory building and equipment.
There were, of course, a number of instances where expenditures ex-
ceeded revenues, but in most cases this was attributable to some special
repair or replacement cost for which no past provision had apparently
been made.
In considering the amount of the excess of revenues over expenditures
of the independent cooperative factories, allowance should be made for
the seasonal nature of the operations, as the production of cheese is largely
concentrated in the summer months when whole milk production is at
its peak.
Operating Results — Cooperative Factories Oicned
by Cheese Milk Producers
With this type of non profit operation a secretary, and in some cases an
auditor, appointed by the shareholders (or cheese milk producers) is
charged with the responsibility of maintaining the books of account and
presenting a statement to the shareholders at the close of the season.
While the financial statements of these cooperative plants were generally
more detailed than those of the independent cooperative factories, there
still exists considerable room for improvement. With some exceptions the
statements merely comprised particulars of cash i-eceipts, including sub-
sidies, and a chronological listing of disbursements showing the name of
the payee, followed by the amount of monies distributed amongst the
shareholders as dividends, such odd sum as might remain being carried
over to the next season.
The processing costs of this type of operation bore reasonably close
comparison with the charge of from 2 cents to 3 cents per pound of finished
product made by the independent cooperative factories operating on a fee
basis, although it was noted that there were fairly wide fluctuations as to
costs between different factories as well as from year to year amongst the
smaller plants particularly, due in some instances to lack of provision for
replacement of the more costly pieces of equipment in prior years.
202 APPENDIX 29
Operating results — entire cheese manufacturing industry:
From the financial statements, questionnaires and other information sub-
mitted to us, we have developed certain data indicating on an overall basis
the costs and profit margins of the 600 cheese factories located in the
Province including the independent manufacturers and both types of
cooperatives.
The quantity and cost of cheese produced by the 30 independents as
distinct from the 570 cooperatives is not presently available to us, neither
are the costs by type of cheese. The table which follows is therefore based
on Cheddar cheese which accounts for 99% of total production, the figures
being submitted for the purpose of providing a general indication on a
Province wide basis of the operating results of cheese manufacturers.
TABLE 1
Condensed operating results of cheese manufacturers
located in the Province of Ontario
for the fiscal year next preceding October 1, 1946.
(Based on productio7i of 115,201,000 pounds)
Cents % of
Amount per pound Sales
Sales (excluding subsidies) $23,040,200 . 20.00 100.00
Material cost (including haulage) $20,086,446 17.44 87. 18
Processing, administrative and distributing cost. 2,608,151 2.26 11.32
Total cost $22,694^97 19.70 98.50
Net profit {before taxes) $ 345,603 .30 1.50
Operating results of individual independent concerns varied considerably,
some showing much wider profit margins than others. The fees and
processing costs of the cooperative establishments varied by 20% and more
in some instances.
The amount of capital employed for the industry as a whole could not
be determined, as many factories do not prepare annual balance sheets on
a cost basis. It is estimated, however, that the amount might approximate
$4,500,000 which would indicate an earnings return of 8% before provision
for income and excess profits taxes.
As we have mentioned, the termination of subsidies by the Dominion
government and the price increase authorized in May last have no doubt
created some important changes within the industry so that figures relating
to the years during which price control and subsidies were in effect afford
little indication regarding current operations.
Financial Position
Having regard to the fact that the majority of cheese plants are privately
owned by cheesemakers, or owned through shareholdings of cheese milk
producers, the amount of capital employed has little direct relationship
to sales volume or profits derived from the manufacture of factory cheese.
This perhaps explains in part why only a limited number of cheese plants
have propei'ly prepared balance sheets setting forth the assets and liabili-
ties of the business in the customary manner.
Selling prices of factory cheese
In the early part of 1941 the average price, combining all grades, was 15c
per pound, but this advanced until a peak of 26.3 cents per pound was
reached in March, 1942.
Following the introduction of subsidies at the close of that year, the
wholesale price f.o.b. factory was reduced to 20c until the close of 1945
when the price rose 2 cents to 22 cents per pound. The summer months of
1946 saw a reversion to the 20 cent price, with an increase of 2 cents per
pound again in the winter months of 1946 and 1947. This price prevailed
until April 30, 1947, when a price increase of 3 cents per pound of cheddar
cheese was authorized at the manufacturers level (equivalent to about 4
cents to the consumer). Thus, from 1939 up to the time of this report, the
APPENDIX 29
203
average selling price of the manufacturers of cheddar cheese has advanced
from 15 cents to 25 cents per pound or 66%.
Cheese is by far the most important milk product exported by the
Dominion from the point of volume as well as dollar value. In 1946 over
106 million pounds was exported at an average price of 20.61 cents per
pound for a value of $21,947,738.
The contribution by the Province of Ontario to this total is not recorded
by the Dominion Bureau of Statistics or the Provincial authorities con-
cerned, but we understand through the trade, that approximately two
thirds of the cheddar cheese production of Ontario is shipped abroad, so
that export prices and volume are normally potent factors in the deter-
mination of domestic prices. Sales of processed and other cheeses which
are produced in volume by the independent cheese manufactui". 's as well
as the larger fluid milk distributors also have some bearing on cheddar
cheese prices within the Province of Ontario.
Marketing methods
The cheese manufacturers have their own mr. tketing agency known as
the "Ontario Cheese Producers' Association Limited." The constitution,
objects, and certain of the by-laws together with an outline of the procedures
followed are clearly set forth in the brief submitted by them.
Export sales are handled through the medium of Montreal brokers,
prices and terms being largely governed by trade agreements executed by
the Dominion government and that of Great Britain or other importing
country.
Domestic sales of cheddar cheese representing about 33% of total produc-
tion are handled by brckers and wholesalers but the proportions sold
through each channel are not available. The brokerage rate is Vs of one
cent per pound plus storage and other charges.
With the lifting of price controls the Ontario Cheese Producers' Associa-
tion Limited will resume its functions as in normal times.
Earnings of cheese factories 1946
The estimates received combined with financial statements relating to
the 1946 operations indicate that the earnings of the cheese manufacturing
industry for 1946 may be less than those of the fiscal year next preceding
October 1, 1946, due to a 19% reduction in output.
Outlook for 1947
A serious contraction in exports of cheddar cheese occurred during the
first quarter of 1947, shipments from Canada totalling only 2,845,200 pounds
against 15,132,100 pounds for the corresponding period in 1946. This
might mean a substantial loss in revenues to Ontario cheese manufacturers
and producers.
Related figures for the second quarter of the current year are not yet
available but it is thought that the reduction from 1946 might not be as
marked as in the first quarter.
Countering the foregoing are the price adjustments to producers and
manufacturers of Maj% 1947. Although the producers received the greater
portion of such price increase, it is considered that the profits of the
manufacturers should at least equal those of 1946, provided satisfactory
markets are found to absorb sufficient cheddar cheese to compensate for
the reduced exports to the United Kingdom indicated in the first quarter
of the current year.
With ceiling prices removed manufacturers are at liberty to take any
steps which may be deemed necessary to ensure satisfactory profit margins,
so that should the present price structure fail to achieve the desired results
corrective measures can be taken through negotiation.
Observations and conclusions
The factory cheese industry of Ontario requires about 86% of the quantity
of whole milk used in the fluid milk industry, yet the producer price is
substantially less. Its influence on the overall position of the fluid milk
and milk products industry is therefore very considerable.
It is apparent that reasonable profit margins for the cheese factory
operators and the cheese milk producers must be assured if they are to
maintain volume production and thereby play their full part in the overall
progress of the industry.
204 APPENDIX 29
Our survey of the manufacturing and producer phases of the industry
provides no indication that the profit margins up to the close of 1946 were
more than reasonable having regard to the seasonal nature of their opera-
tions and the importance of their contribution to the overall position of
the industry,
Possible increase in sales revenue:
Domestic prices of cheddar cheese are influenced by the export prices
also the selling prices of processed cheese. A selling price increase, largely
to replace Dominion subsidies which were terminated, was authorized in
May last and it would seem premature to consider any further upward
adjustment in selling prices until sufficient time has elapsed to permit a
reasonably accurate assessment of its efi'ect on earnings.
There has been a serious contraction in export sales of cheddar cheese
in the first three months of 1947 as compared with the corresponding
months in 1946. Production has also declined by 4.3 9f up to March 31st,
1947. as compared with the first three months of 1946, and these factors
are bound to have an effect on revenues and profits. They may in fact
ofl:'set the benefits which may be expected from the domestic price increase
of 1947.
At the time of writing this report, therefore, we see little prospect of
any substantial increase in revenues unless production of butter and other
products of cheese manufacturers are developed on an appreciable scale.
Possible savings and economies:
As about 87 ^f of the total sales revenue is accounted for in the material
cost of cheese, the margin on which economies might be applied is limited,
especially when fixed charges such as business and property taxes and
depreciation are eliminated. However, on account of the large volume,
the smallest saving in the unit cost of any product reaches considerable
significance in the overall earnings.
The processing and labour costs are the two most important factors in
the overall cost apart from raw materials and to properly explore the
possibilities of any savings under these two headings would require the
assembly of much more data than is presently available. If a determined
effort is to be made to hold processors' costs within certain limits the
assembly of sufficient detailed statistical data is a pre-requisite.
Statistical data:
It is suggested that those authorities responsible for the safeguarding of
the public interest and the advancement of the factory cheese industry in
conjunction with the overall progress of the entire milk industry, should
immediately formulate plans which will ensure all concerned being fully
informed on the developments and trends which are bound to reveal
themselves now that the industry is in the transitional stage from emer-
gency controls to free enterprise and perhaps more keen competition in
both the home and foreign markets.
To achieve this, it is important that more detailed information be
obtained concerning the operations of the two types of cooperative factories
referred to as distinct from the independent factories, than has been
possible for us to procure in the time at our disposal.
We also consider that the statistical data presently available to the
Provincial authorities, in respect of both export and domestic sales, should
be enlarged upon particularly as regards type of outlet and related prices
and quantities.
Due to the other divisions of the milk industry producing cheese as
well as other products, it is important that there exist the utmost co-ordina-
tion between them, and to permit of this, adequate information should be
readily available on each product and classification of business.
Accounting records:
As regards both the independent operators of cheese factories and the
cooperative plants the standard of accounting, with a few exceptions,
leaves much to be desired.
In both types of operation the onlj^ particulars of revenue and expenses
available in many instances, consisted of a statement of cash receipts and
disbursements, or receipts and expenditures, with the items listed chrono-
logically and little, if any, description as to the nature of the expense.
APPENDIX 29
20^
No systematic provisions to meet emergency replacements of equipment
are made as a general rule, so that the costs of conversion or processing
sometimes vary considerably from year to year especially amongst the
smaller factories where the volume is not sufficiently large to permit the
absorption of any extraneous expense or special repair or replacement
cost without seriously affecting the profit position.
As with other sections of the milk industry, we would recommend the
introduction of a standard accounting system of a simplified nature which
would ensure the satisfactory and prompt completion of informative returns
of an administrative or statistical character and at the same time serve to
improve the standard of managerial and accounting control in an industry
which is of vital concern to milk producers and the consuming public.
Finally we would direct your attention to possible economies in the
manufacturing phase which might be disclosed by careful study of a
selected representative group of operators, both cooperative and
independent.
Productive capacity:
From our review of the questionnaires we formed the impression that
the productive capacity of cheese factories is appreciably in excess of actual
requirements even allowing for the seasonal natui'e of the industry, the
peak periods and tlie usual surplus margins to meet emergency conditions.
The output in 1946 represented but 75'Vf of 1942 production so that further
contraction might cause hardship amongst factory owners. The desirability
of having statistical data on productive capacities by areas might therefore
be considered.
CJianges in ownership:
It would appear that cheese factories have not changed hands with the
same frequency as fluid milk distributive businesses. On enquiring into
one of the more recent important transactions it was found that the factory
liad been acquired by a condensary at a consideration which seemed attrac-
tive to both buyer and seller. It has since been converted into a receiving
station.
As with other divisions of the milk industry we incline to the view that
such transactions should be brought to the notice of some designated
Provincial authority and approval in every particular obtained before the
deal is consummated.
Marketing methods:
With the resumption of normal trading the greatest responsibilities rest
with the marketing agency, the brokers and wholesalers. The profit
margins of the manufacturers and the cheese milk producers largely depend
on the efficiency and merchandizing ability of the distributive bodies.
RespectjuUy submitted.
Accountant, Royal Commission on Milk.
JOHN S. ENTWISTLE.
Province of Ontario.
Julv 26th. 1947.
ONTARIO
SECOND
ANNUAL REPORT
THE
LIQUOR AUTHORITY
CONTROL BOARD
OF ONTARIO
From April 1st, 1945
To March 31st, 1946
Sessional No. 52, 1947
Printed and Published by Baptist Johnston
Printer to the King's Most Excellent Majesty
THE LIQUOR AUTHORITY CONTROL BOARD OF ONTARIO
454 University Avenue,
Toronto 2, Ontario,
October 29, 1947
To THE HONOURABLE LESLIE E. BLACKWELL, K.C.,
Attorney-General of Ontano,
Parliament Buildings, Toronto 5, Ontario.
SIR,—
Herewith I submit the Second Report of the Liquor Authority Control
Board of Ontario for the twelve months' fiscal period, which ended the 31st
of March, 1946.
The Members of the Board were : Judge W. T. Robb, Chairman ; William
T. Nugent, Vice-Chairman ; and J. Frederick Reid. On August 1, 1945, J.
Frederick Reid tendered his resignation and he was succeeded by John
Franklin White.
The Authority Districts throughout the Province numbered fourteen
made up as follows :
DISTRICT DISTRICT
NUMBER COMPRISING CENTRE
1 Counties of Elgin (except Vienna), Es-
sex, Kent and Lambton WINDSOR
2 Counties of Bruce, Grey, Huron, Perth,
Waterloo and Wellington KITCHENER
3 Counties of Middlesex and Oxford LONDON
4 Counties of Brant, Haldimand, Lincoln,
Norfolk and Welland (and Vienna only
in Elgin) ST. CATHARINES
5 Counties of Wentworth and Halton HAMILTON
6 County of York TORONTO
7 Counties of Durham, Ontario, Peterbor-
ough, Victoria and District of Hali-
burton PETERBOROUGH
8 Counties of Dufferin, Peel, Simcoe and
Districts of Muskoka and Parry Sound BARRIE
9 Counties of Hastings, Lennox, Nor-
thumberland and Prince Edward BELLEVILLE
ANNUAL REPORT OF
No. 52
10
11
12
13
14
Counties of Addington, Dundas, Front-
Glengarry, Grenville, Leeds and
enac,
Stormont
Counties of Carleton, Lanark, Prescott,
Renfrew and Russell
Districts of Kenora, Rainy River and
Thunder Bay
Districts of Algoma, Manitoulin and
Sudbury
Districts of Cochrane, Nipissing and
Temiskaming
BROCKVILLE
OTTAWA
FORT WILLIAM
SAULT STE. MARIE
KIRKLAND LAKE
The Board held the following meetings:
Annual Meetings — one in each of the 14 Districts 14
Special Meetings — at District Centres 19
Special Meetings — at Head Office, Toronto 50
The Board had twenty-four (24) inspectors in the various fourteen districts
whose duties were to make periodic, as well as non-scheduled, inspections of
all premises throughout the Province. Monthly reports were supplied in
respect of each authority as well as a detailed annual report. The inspectors
also submitted special reports when they deemed the same necessary or ad-
visable. The many and varying duties of the inspectors include the observa-
tion of the operation of the premises to see that the same are conducted
according to the law, the cleanliness of the licensed premises, the types and
quality of service provided in hotels, attention to sterilization of glasses used
in the consumption of beverages, the cleanliness of kitchens and equipment
therein and, also, the protection afforded against fire.
On March 31, 1946, the end of the fiscal year, there were in existence
1,239 Hotel Authorities, of which 29 were Summer Hotels operating under
an Authority for six months of the year; 146 Social Club Authorities; 130
Veteran and Labour Club Authorities; 205 Military Mess Authorities; and
7 Steamship Authorities. (SCHEDULE I is a list of these Authorities).
During the twelve months previous to March 31, 1946, four Hotels, one
Social Club and one Steamship were destroyed by fire, as follows :
Beaumaris Hotel Beaumaris
Red Lake Hotel Red Lake
Park Hotel Stanley
Clarendon Hotel Hastings
Kirkland Lake Golf Club Kirkland Lake
S. S. "Hamonic"' Sarnia
and their authorities were taken out of operation.
LIQUOR AUTHORITY CONTROL BOARD
Five Authorities were surrendered during the period, namely ;
National Hotel Field
Jerome Community Club Jerome
George Club Fort William
Ulster Athletic Club Toronto
Master Chefs, Cooks and
Pastry Cooks, Local No. 7 Toronto
The Authority of the Locust Lawn Tennis and Country Club, Islington,
was cancelled for cause.
Authorities were issued to 14 new hotels ; 6 new Social clubs ; and 8 new
veterans' clubs. The names of these are included in Schedule I and designated
as (new).
All of the Authorities listed in Schedule I were renewed for the year
1946-47 with the exception of those set forth in SCHEDULE H.
SCHEDULE HI sets forth detailed statement of Authorities transferred ;
and
SCHEDULE IV, a list of Authorities suspended.
SCHEDULE V gives a detailed statement of the Board's expenses as
of March 31, 1946.
During the year the Board found unsatisfactory persons operating
Authorities of varying kinds who have been replaced on the order of the
Board.
For the fiscal year April 1, 1945, to March 31, 1946, there was collected
as transfer fees the sum of $732,823.65.
The Board received the utmost co-operation from Provincial as well as
Municipal police officers with only a few exceptions. The Board has a staff
of efficient and loyal employees who have given splendid service — many of
them spending many hours of overtime to enable prompt despatch of business
of the Board.
Respectfully submitted by
W. T. ROBB,
Chairman.
ANNUAL REPORT OF
No. 52
SCHEDULE No. I
Authorities In Existence and the Name of the Owners Thereof
As of March 31st, 1946
HOTELS
MUNICIPALITY
ACTON
ALEXANDRIA
ALFRED
ALGOMA MILLS
ALMONTE
ALVINSTON
AMHERSTBURG
AMULREE-
ANSONVILLE
ARMSTRONG
ARNPRIOR
NAME OF HOTEL
Dominion Hotel
Main Street
Station Hotel
Alexandria Hotel
Ottawa House
Ontario Hotel
Main Street
Prescott Hotel
Main Street
Algoma Inn
Almonte Hotel
Bridge Street
Columbia Hotel
River Street
Grand Central Hotel
Amherst Hotel
Richmond Street
Anderdon Hotel
R.R. 3
Lakeview Hotel
Lucier's Hotel
R. R. 1
Royal Hotel ......
R. R. 1, Stratford- '/
Anson Hotel
65 Main Street
Capitol Hotel
Union Hotel
Railway Street
King George Hotel
Central Hotel
69 Madawaska Street
New Byrne Hotel
197 John Street
NAME OF OWNER
Royston, Mrs. M. A.
Lasby, S. M.
Weir, A. C.
Rouleau, E.
Lafleur, E.
Houle, L.
Hoeberg, Mrs. M.
Whitten, A. H.
Bindner, C. W.
Simpson, S. S. and
Munro, J. D.
Fleming, C. W.
Travica, S.
Ljiljak, J. and Ostoich, E.
Lucier, D.
^j.-Pedlaj^r, Philip S.
Lozier, P.
Purificati, D.
Abramson, L.
Lindholm, Mrs. H. I.
Bedore, Mrs. C.
Byrne, J. R.
LIQUOR AUTHORITY CONTROL BOARD
MUNICIPALITY
ARTHUR
ASTORVILLE
ATHERLEY
ATIKOKAN
AYEMER
AYR
AYTON
BADEN
BAEA
«
BARRIE
BARRY'S BAY
BARWICK
BATCHEWANA BAY
BEARDMORE
BEAUMARIS
BEETON
NAME OF HOTEL
Commercial Hotel
George Street
Queen's Hotel
Rochefort Hotel
Atherley Arms Hotel
Lakeview Hotel
Atikokan Hotel
Central Hotel
Queen's Hotel
Swan Street
Commercial Hotel
Baden Hotel
Maple Leaf Hotel
New Windsor Hotel
Bala Bay Lodge
American Hotel
74 Collier Street
Clarkson Hotel
130 Dunlop Street
Clifton Hotel
257 Bradford Street
Queen's Hotel
94 Dunlop Street
Simcoe Hotel
Five Points
Wellington Hotel
4 Elizabeth Street
Balmoral Hotel
Barwick Hotel
Batchewana Hotel
Beardmore Hotel
Roseneath Manor
Beetonia Hotel
NAME OF OWNER
West, W. L. and
Bolen, W. R.
Gaffney, F. C.
Rochefort, H.
Atherley Arms Limited
Atkinson, F. M.
Shelepiuk, Mrs. E.
Brooks, C. A. and
Lamb, C.
Targonski, Stanley
Doersam, Peter F.
Stiefelmeyer, Mrs. E. D.
Habel, C.
Frew, Thos. and Mathew
Davey, C.
Soyko, W. and
Shewchuk, M.
White, F. and
McElroy, J. E.
Kerrigan, S. C.
Queen's Hotel (Barrie)
Limited
Cohen, M. and Dollinger,
Simon
Wellington Hotel
(Barrie) Limited
Estate of J. B. Billings
Strain, F. J. and Gallo, S.
Migneron, C. H.
Beardmore Hotel
Company Limited
Boyd, L S. and Estate of
F. T. W\ Ford
Boake, R. H.
10
ANNUAL REPORT OF
No. 52
MUNICIPALITY
BELLE RIVER
NAME OF HOTEL
NAME OF OWNER
BELLEVILLE
BERWICK
BIGWOOD
BLAIR
BLENHEIM
BLEZARD VALLEY
BLIND RIVER
BLYTH
BONFIELD
BOTHWELL
BOURGET
Alexander Beach Grove Carriere, A.
Hotel
R. R. 1 (Maidstone Twp.)
Belle River Hotel
Main Street
Cooper Court Hotel
King George Hotel
Main Street
Wellington Hotel
Belvedere Hotel
360 Front Street
Canadian Hotel
Z7 Dundas Street
City Hotel
310 Front Street
Crystal Hotel
317 Front Street
Doctor's Hotel
2Z7 Station Street
New Queen's Hotel
158 Front Street
Quinte Hotel
Bridge & Pinnacle Streets
Ottawa Hotel
Commercial Hotel
Nicholson Inn
Blenheim Hotel
Cadillac Hotel
Talbot Street
Blezard Hotel
Harmonic Hotel
Woodward Avenue
Lincoln Hotel
Riverside Hotel
Parent, C. J.
DeRush, J. E.
George, J.
Tomich, D.
Allore, Mrs. L.
Canadian Hotel
(Belleville) Limited
Yanover, J. N.
Treverton, C. B.
Briens, A. J. and Mrs.
Cecilia
Ryan, Mrs. Z. H.
Hotel Quinte Limited
Chales, P. H.
Loiselle, J.
Nicholson, Mrs. I. M.
Kent, D. E.
Getty, F. H. and Mrs. J.
Dennie, Glenn J.
Laforge, O.
Doyle, J. J. and Robert, J.
Gauthier, A.
Riverview Hotel (New) Berthelot, J. L.
Commercial Hotel
Ottawa Hotel
Central Hotel
164 Main Street
Royal Hotel
Clare, G. W.
Corbeil, N.
Morgan, L.
Gagne, Rheal
LIQUOR AUTHORITY CONTROL BOARD
11
MUNICIPALITY
BRADFORD
BRANTFORD
BRECHIN
BRESLAU
BRIDGEPORT
BRIGHT
BROCKVILLE
BRONTE
BRUCE MINES
NAME OF HOTEL
Queen's Hotel
Holland Street
Villasre Inn
Belmont Hotel
157 Colborne Street
Bodega Hotel
64 Market Street
Brant Hotel
89 Dalhousie Street
Kerby House
224 Colborne Street
New Benwell Hotel
187 Market Street
New Butler Hotel
20 Dalhousie Street
Prince Edward Hotel
16 Colborne Street
St. Julien Hotel
239" Market Street
Strand Hotel
97 Dalhousie Street
Victoria Hotel
Breslau Hotel
Lancaster Hotel
Arlington Hotel
Clifton Hotel
220 King Street, West
Commercial Hotel
214 King Street, West
Garbutt's Hotel
19 King Street, East
Grand Central Hotel
130 King Street, West
Manitonna Hotel
1 King Street, East
Pig & Whistle Inn
R. R. 1
Bayview Hotel
NAME OF OWNER
McEvoy, H. J. and F. M.
Culham, W. H. and
Grant, C. E.
Bailev, H. H. and
Mrs. F. M.
Bodega Hotel Ltd.
Brant Apartments Ltd.
Estate of I. W. Champion
and Estate of Miss E.
Zimmerman
McQueen, R.
Casey, J.
Howarth, A.
Wood, Miss E.
Craise, Robert A.
Mitchell, F. J.
Brohman, C.
Querin, F.
Moss, Charles H.
O'Connor. Mrs. M. H.
Archinal, J.
Ashley, Mrs. Jessie
Ness, Mrs. B. M.
Brockville Hotel
Company Limited
Mullaney, John and
Mrs. Olive S.
Downey, W. J.
12
ANNUAL REPORT OF
No. 52
MUNICIPALITY
BRUSSELS
BURK'S FALLS
BURLINGTON
CACHE BAY
CALEDONLA
CALLANDER
CAPREOL
CARDINAL
CARGILL
CARLSBAD SPRINGS
CARLSRUHE
CASSELMAN
CAYUGA
CENTRAL PATRICIA
CHALK RIVER
CHAPUT HUGHES
CHATHAM
NAME OF HOTEL
Queen's Hotel
Turnberry Street
Central Hotel
Brant Inn
Water Street
Coronation Hotel
25 Brant Street
Estaminet Hotel
50 Water Street
Sherwood Inn
35 Brant Street
Cache Bay Hotel
Railway Street
Traveller's Hotel
Exchange Hotel
Argyle Street
Union Hotel
Argyle Street
Callander Hotel
Red Line Inn
Capreol Hotel
Front Street
Dillon House
Village Inn
Johnson's Hotel
British Hotel
New Commercial Hotel
Russell Hotel
Main Street
Campbell House
Cayuga Hotel
Patricia Hotel
Chalk River Hotel
\'illage Hotel
Aberdeen Hotel
1 Grand Avenue, East
C.P.R. Hotel
9 King: Street
NAME OF OWNER
Kirby, Mrs. M.
Bowie. Mrs. A. M. and
Brasher, Miss B. E.
Kendall, C. H. and
Anderson, J. M.
Kozak, M.
Byrens, Mrs. E. M.
Timleck, Mrs. L.
Arcand, Jos.
St. George, L.
Thacker, A.
O'Meara, David
Stirling, Mrs. L.
Wookey, L.
Capreol Hotel So., Ltd.
Dillon, W. A.
Schmidt. R. G.
Johnson, Mrs. H.
Halter, C. J.
Giroux, P.
Boileau, R.
Best, J. O.
Shippel, J. A.
Wilson, E. S.
Dover, C. C.
Dame, A.
Martin, Jas. C.
Ange, T. L.
LIQUOR AUTHORITY CONTROL BOARD
13
MUNICIPALITY
CHATHAM
CHATSWORTH
CHELMSFORD
«
CHEPSTOW
CHESTERVILLE
«
CHIPPAWA
NAME OF HOTEL
Chatham Hotel
49 Fifth Street
East End Hotel
119 King Street, East
Merrill House
2 King Street, West
Montreal Hotel
179 Grand Avenue, West
Park View Hotel
35 William Street, North
Rankin Hotel
182 King Street, West
Tecumseh Hotel
342 Queen Street
William Pitt Hotel
Sixth Street
Campbell House
Algoma Hotel
Welcome Hotel
Front Street
King Edward Hotel
Dominion Hotel
McCloskey House
Chippawa Hotel
18 Main Street
" Riverside Hotel
CHUTE A BLONDEAU Central Hotel
CLARENCE CREEK Du Peuple Hotel
CLIFFORD
COBALT
COBOCONK
COBOURG
Union Hotel
Mansion Inn
Elora Street
Eraser House
24 Prospect Avenue
Miner's Home Hotel
75 Lang Street
Pattie House
Baltimore Hotel
174 Division Street
NAME OF OWNER
Kerr, J. B.
Blondeel, G.
Harris, L.
Campbell, M. and H. C.
Prince, E. A.
Pleasence, J. A. and
Mrs. J. J.
Morgan, R.
William Pitt Hotel
Limited
Crawford, J. F. and
Mrs. M.
Trottier, D. and P.
Vaillancourt, E.
Fleming, Mrs. M.
Lefebvre, A. A.
Barker, F. W.
Kclaczynski, K.
Sainovich, G.
Martineau, D.
Potvin, E.
Gagnon, A.
Kruspe, J. A.
Abraham, E. A. and R.
Robitaille, J. A.
Cheney, G. J.
Mackie, J. W.
14
ANNUAL REPORT OF
No. 52
MUNICIPALITY
COBOURG
COCHRANE
CONESTOGO
CONNAUGHT
STATION
CORNWALL
NAME OF HOTEL
British Hotel
68 King Street, West
Chateau Hotel
55 King Street, East
Homelike Inn
205 Third Street
New Dunham Hotel
256 Division Street
New Royal Hotel
7Z King Street
Albert Hotel
183 Railroad Street
Anderson Hotel
179 Fourth Avenue
King George Hotel
Fourth & Railway Sts.
London Hotel
Railway Street
Northland Hotel
125 Fourth Avenue
Stevens House
223 Railway Street
Trail's End Hotel
5 King Street
Connaught Hotel
Carleton Hotel
Z?) First Street, East
Central Hotel
341 Pitt Street
Cornwallis Hotel
22 Second Street, West
Grand Hotel
440 Water Street, East
King George Hotel
3 Second Street, East
National Hotel
830 Second Street, West
Lloyd George Hotel
15 Pitt Street
Royal Hotel
106 Montreal Road
NAME OF OWNER
Caughey, L. A.
Rogers, Mrs. B. I.
Kelly, G. H.
Bell, F. J.
Midgley, J. A.
Boisvert, A.
Thiboutot, F. X.
Dobenko, M.
Chamandy, Mrs. F.
Johnson, Mrs. A.
Stevens, Mrs. Francis E.
Richter, M.
Racicot, L.
Runions, Mrs. M. E.
Miller, J.
Cornwall Community
Hotel Company Ltd.
Miron, A. D.
Thomas and Nash
Limited
Humans, M.
Lloyd and George Hotel
Company Limited
Fred Lefebvre Company
Limited
LIQUOR AUTHORITY CONTROL BOARD
15
MUNICIPALITY
CORNWALL
COURTLAND
COURTWRIGHT
CROW LAND
CRYSLER
CRYSTAL FALLS
CRYSTAL BEACH
CURRAN
DELHI
DESBORO
DESERONTO
DOUGLAS
DRESDEN
DRYDEN
DUBLIN
NAME OF HOTEL
St. Lawrence Hotel
198 Montreal Road
Courtland Hotel
Bedard Hotel
Front Street
Station Hotel
619 King Street
Commercial Hotel
NAME OF OWNER
Mercier, A.
Vecsi, J.
Bedard, Mrs. L. J.
Adamcryck, J. and
Zuba A.
Brisebois, E. and
Martin, D. E.
Russell Hotel
Charles Street
Chebogan Hotel (New)
Teal's Hotel
Hebert Hotel
Ridge Road
Lincoln Hotel
5-7 Lincoln Road, East
Markcity Hotel
7 Cambridge Street, East
Sheehan's Terrace Inn
41 Terrace Lane
Martinell Hotel
Ontario Hotel
Park Hotel
Curran Hotel
Delhi Inn
Stoddard Hotel
King & Main Streets
Desboro Hotel
Arlington Hotel
Main Street
Minto House
Morgan Hotel
Main Street
Central Hotel
20 King Street
Dryden Hotel
74 Queen Street
Huron Hotel
Dutt, J. J.
Fisher, Robert
Teal, Mrs. J. B.
Hebert, W. O.
Buck, E. A.
Berezowsky, W.
Milligan, E.
O'Brien, Mrs. M. E.
Holmes, W.
Hitch, Mrs. E.
Laframboise, V.
Warden, H. and
Caswell, H. L.
Tuinyla, M.
Fitzpatrick, J.
Marck, Stanley R.
Neville, M. T.
Weese, D. J.
Kunza, A. A.
Self, W. E.
Mulligan, P.
16
ANNUAL REPORT OF
No. 52
MUNICIPALITY
DUNDAS
DUNKELD
DUNNVILLE
EAGLE RIVER
EARLTON
EASTVIEW
EAST YORK
EGANVILLE
ELGIN
ELK LAKE
(( ((
ELMIRA
ELMVALE
NAME OF HOTEL
Central Hotel
93 King Street
Collins Hotel
33 King Street
Melbourne Hotel
89 King Street
Dunkeld Hotel
R. R. 4, Walkerton
New Royal Hotel
Maple Street
Queen's Hotel
121 Main Street
Savoy Hotel
418 Chestnut Street
Victoria Hotel
Chestnut Street
Cascade Hotel
Cecil Hotel
LaSalle Hotel
Claude Hotel
48 Beech wood A\'enue
Eastview Hotel
120 Montreal Road
Wallace Hotel
302 O'Connor Drive
Central Hotel
Eganville Hotel
Empire Hotel
King Edward Hotel
Stonehouse Hotel
Fourth Street
Central Hotel
32 Arthur Street
Royal Hotel
4 Arthur Street
Steddick House
52 Arthur Street
New Palace Hotel
Queen Street
NAME OF OWNER
Haley, E. J.
Lowry, E. F.
Deratnay, G.
Eigenbrod, ^Irs. C. P.
Hensgens, J. and Mrs. M.
Edgar, G. R.
^IcCorrie, J. P.
Garbutt, F.
Steiner, J.
Paiement, Roger
Cloutier, A.
Claude Hotel Co. Ltd.
Eastview Hotel Ltd.
Wilson, G. A.
Foy, F. C.
Sammon, Miss Mona
Estate of P. J. Fahey
Montpetit, E. and
Sauve, L.
Rusich, Nick and Mrs. >\I.
Mailloux, W. E.
Harvey, G. J.
Yanchus, Mrs. P. E.
Smith, A.
LIQUOR AUTHORITY CONTROL BOARD
17
MUNICIPALITY
ELMWOOD
ELORA
EM B RUN
EMO
ENGEEHART
ERIEAU
ERIN
ERINSVILLE
ESPANOLA
ESSEX
ETOBICOKE
FAIRBANK
FALLS VIEW
FAVORABLE LAKE
FERRIS WEST
(( <<
FIELD
FISHERVILLE
FLINTON
FOLEYET
FORBES
FORMOSA
NAME OF HOTEL
Queen's Hotel
Iroquois Hotel
Metcalfe Street
Standard Hotel
Emo Hotel
Clifton Hotel
Commercial House
Fourth Avenue
Eldon House
Lakeview Hotel
Busholme Hotel
Lakeview Hotel
Espanola Hotel
1 Barber Street
Aberdeen Hotel
Talbot Street
Grand Central Hotel
Talbot Street
The Old Mill
35 Old Mill Road
Fairbank Hotel
2418 Dufferin Street
Falls View Hotel
2434 Stanley Avenue
Hill Top Lodge
Algonquin Hotel
Lakeview Inn
Field Hotel
Erie House
Stewart House
Holden Street
Commercial Hotel
Gold Belt Hotel
Maple Leaf Hotel
Commercial Hotel
Formosa Hotel
NAME OF OWNER
Sainsbury, O.
Wood, J. A.
Burelle, P. A.
Johnston, G. F.
Korman, D.
Clark, J.
Morris, Jas.
Yandrash, I. and
Vucic, Vid
Fullerton, A. M.
Wagar, W. S.
Alexander, D.
Stoots, W. F.
Crowley, L. L.
Valley Improvement
Company Limited
Crawford, S. B.
Podhorn, S. F.
Hill Top Lodge Co. Ltd.
Dugas, W. W\
Leach, Mrs. M.
Sauve, Leo and Philippe
Bonner, W. E.
Yanch, J. E.
Denommee, J. Robert
and M.
Mageau, F.
Dubois, Z. and Giroux, A.
Schnurr, C.
Opperman, A. M.
18
ANNUAL REPORT OF
No. 52
MUNICIPALITY
FORT ERIE
FORT ERIE NORTH
<( (< ((
(( (( ((
FORT FRANCES
FORT WILLIAM
NAME OF HOTEL
Anglo-American Hotel
280 Niagara Boulevard
Erie Lane Hotel
33 Princess Street
Fort Erie Hotel
224 Garrison Road
G. T. R. Hotel
366 Gilmore Road
New King Edward Hotel
271 Niagara Boulevard
Niagara Hotel
92 Niagara Boulevard
Barnea House
28 Courtwright Street
Merview Hotel
56 Courtwright Street
Ohio Hotel
33 Niagara Boulevard
Royal Hotel
1 Niagara Boulevard
Emperor Hotel
400 Front Street
Fort Frances Hotel
427 Mowat Street
Monarch Hotel
Front Street
Prince Albert Hotel
131 Church Street
Rainy Lake Hotel
235 Scott Street
White Pine Inn
800 Scott Street
Adanac Hotel
227 Simpson Street
Alexandra Hotel
100 Gore Street, East
Empire Hotel
140 Simpson Street
Empress Hotel
105 Heron Street
Royal Edward Hotel
114 South May Street
NAME OF OWNER
Neichenbauer, A., A.
and C.
Masich, Frank J. and
Nickolas E.
Wetzel, P. H.
Karpiniec, J.
Sima, Andrew, Andrew
Jr. and Stanko, M.
Kee, W.
Dancy, R. P.
Compton, M.
Zajac, Andrew
Uster, Mrs. Verna
Pidlubny, G.
DeCruyenaere, A. A.
Pechet, W.
Griffiths, Mrs. Marie
Gray, J. J.
Crawford, A. G.
Estate of D. L. Crites
Zaroski, W.
Hurtig, M. and B.
Zaroski, W.
Fort William Hotels Ltd.
LIQUOR AUTHORITY CONTROL BOARD
19
MUNICIPALITY
FORT WILLIAM
FOURNIER
FRANZ
GADSHILL
GALT
GANANOQUE
GARSON
GEORGETOWN
GERALDTON
GLENCOE
GLEN ORCHARD
POST OFFICE
NAME OF HOTEL
St. Louis Hotel
401 Victoria Avenue
Simpson Hotel
401 Simpson Street
Victoria Hotel
Victoria Avenue &
Syndicate Street
Wayland Hotel
1019 Gore Street, West
West Hotel
126 Simpson Street
Commercial Hotel
Main Street
Franz Hotel
Exchange Hotel
R. R. 1
Iroquois Hotel
129 Main Street
New Albion Hotel
103 Water Street, North
0\'erland Hotel
18 Concession Street
Royal Hotel
138 Main Street
International Hotel
King & Main Streets
Provincial Hotel
King Street
Gananoque Inn
Stone Street
Royale Hotel (New)
Exchange Hotel
McGibbon Hotel
Main Street
Geraldton Hotel
130 First Avenue
Thunder Bay Hotel
Main Street
McKellar House
Main & McKellar Streets
Sherwood Inn
NAME OF OWNER
Rothwell, S. E.
Watson, R. O.
Wadson, I. I.
Bernardi, B.
Black, A. J.
Besner, L.
Miller, Mrs. A. M.
Gerhardt, G. C.
Iroquois Hotel Limited
Murray, A. H.
White, Mrs. F. E.
S. A. Greer Interests Ltd.
McGregor, Mrs. A. I.
McCarney, H. A.
Gananoque Inn Limited
Mady, Chas. A.
Wright, Mrs. A.
Estate of S. H. McGibbon
Draper, W. F.
Koleff, K.
Loosemore, Mrs. E.
Sherwood Inn Limited
20
ANNUAL REPORT OF
No. 52
MUNICIPALITY
GODERICH
GOGAMA
GOLDEN LAKE
GOWGANDA
GRAVENHURST
GRIMSBY
GUELPH
HAGAR
HAGERSVILLE
HAILEYBURY
HAMILTON
NAME OF HOTEL
Bedford Hotel
132 The Square
British Exchange Hotel
Royal Hotel
Hamilton Street
Gogama Hotel
Golden Lake Hotel
White House
Albion Hotel
Muskoka Street
Gilmour Hotel
Muskoka Street
Grimsby Hotel
30 Main Street, West
Village Inn
57 Main Street, West
Albion Hotel
49 Norfolk Street
King Edward Hotel
2 Wyndham Street
New Western Hotel
72 Macdonnell Street
Regent Hotel
52 Macdonnell Street
Royal Hotel
106 Garden Street
Wellington Hotel
Wyndham Street
Royal Hotel
Commercial Hotel
King Street
New Alward Hotel
Main Street
Haileybury Hotel
Ferguson Avenue
Lake Shore Hotel
Matabanick Hotel
Armoury Hotel
195 James Street, North
NAME OF OWNER
Knechtel, Mrs. E. M. and
Curry, Mrs. A. E.
Fellow, Mrs. M. G.
Estate of Margaret Kellv
(Miss M. L. Kelly,
Administratrix)
Giroux, A.
Layman, C.
LaFrance, H. and Mrs. D.
Fletcher, Mrs. E. E.
Estate of R. P. Powell
Hannah, G. A.
Hannah, G. A.
Thompson, Mrs. M. P.
Walsh, W. and
Musselman, H. C.
Singular, J. A.
Regent Hotel (Guelph)
Limited
Fischer, D. M.
Bristol Hotel Co. Ltd.
Roy, C.
Dubrick, C.
Edmunds, F. C.
New Temiskaming Hotel
Limited
Boyer, E.
Bulger, Mrs. J. F.
Armoury Hotel Co. Ltd.
LIQUOR AUTHORITY CONTROL BOARD
21
MUNICIPALITY
HAMILTON
NAME OF HOTEL
Athletic Hotel
12 Market Square
Avon Hotel
912 Barton Street, East
Balmoral Hotel
669 King Street, East
Bayview Hotel
81 Stuart Street, West
Brightside Hotel
909 Burlington Street, E.
Britannia Hotel
672 Barton Street, East
British Empire Hotel
373 Sherman Avenue, N.
Carlton Hotel
659 King Street, East
Cecil Hotel
113 James Street, North
Dog & Gun Hotel
295 York Street
Dundurn Hotel
452 York Street
El-Mar Hotel
163 Main Street, West
Fischer's Hotel
51 York Street
Gage Hotel
105 Beach Road
Genessee Hotel
468 James Street, North
Gladstone Hotel
1385 Main Street, East
Grand Hotel
5 Gore Street
Greene's Hotel
R. R. 1
Curry's Hotel
175 Young Street
Hanrahan Hotel
92 Barton Street, East
Homeside Hotel
229 Kenihvorth Avenue,
North
NAME OF OWNER
Murphy, J. J.
Smith, L. V.
Cowan, Mrs. K.
Senson, Paul
Graham, W. B. P.
Watson, Mrs. J. G.
Sych, D. and Lorenitis, S.
Berryman, F. J. and L. F.
Olivieri, D.
Wintonek, D. and
Wicinski, J.
Brick, W. J.
Skingley, Mrs. F. W.
Fischer, W. L.
Krzyzan, P.
Sardo, L.
Spencer, J.
Ryan, J., Marck, K. and G.
Greene, J. J.
Kavanagh, D.
Hanrahan, J. J.
Rosart, C. J. and
Taylor, D.
22
ANNUAL REPORT OF
No. 52
MUNICIPALITY
HAMILTON
NAME OF HOTEL
Honest Lawyer Hotel
55 Mary Street
International Hotel
309 James Street, North
Iroquois Hotel
94 King Street, West
Jockey Club Hotel
1089 Barton Street. East
Kenilworth Hotel
259 Kenilworth Avenue,
North
King George Hotel
27 McNab Street, North
Melba Hotel
410 York Street
Modjeska Hotel
554 James Street, N.
Park Hotel
476 King Street, West
Piccadilly Hotel
1038 Barton Street, East
Picton Hotel
183 Picton Street, East
Prince Edward Hotel
7Z7 Barton Street, East
Queen's Hotel
180 Ottawa Street
Regal Hotel
152 King Street, West
Royal Connaught Hotel
100 King Street, East
Royal Hotel
94 McNab Street, North
Savoy Hotel
32 Barton Street, East
Sherman Hotel
421 Sherman Avenue, N.
Stafford House
Charles & Main Streets
Strand Hotel
262 Dundurn Street, S.
Terminal Hotel
180 King Street, East
NAME OF OWNER
Davey, N. J.
Martini, D.
Hultey, Wm.
Kretschman, J. H. R.
Walsh, V. J.
Hamilton Hotel
Enterprises, Limited
Traynor, D. P.
Estate of J. J. Murphy
Lorenitis, S. and Sych, D.
Hudecki. L. J. and M.
Brugos, George
Gral, F.
Fleming, A. J.
Smith, J. G.
Connaught Hotel
Company Limited
Labelle, R. J. and
Kumpf, C. H.
Oddie, J. A.
Stecyk, Paul
Myatt, W. J.
Finch, H. T. and
Shadney, Peter
Bach, H. C.
LIQUOR AUTHORITY CONTROL BOARD
23
MUNICIPALITY
HAMILTON
HAMILTON BEACH
HAMMOND
HANMER
HANNON
HANOVER
HARRISTON
HASTINGS
HAWKESBURY
NAME OF HOTEL
Turbinia Hotel
345 James Street, North
Vienna Hotel
152 Gertrude Street
Waldorf Hotel
28 Merrick Street
Waverley Hotel
632 Barton Street, East
Wellington Hotel
161 Wellington Street, N.
Wentworth Arms Hotel
Main & Hughson Streets
Wentworth Hotel
365 Wentworth Street, N
Whitmore Hotel
59 McNab Street, North
Wilson's Hotel
388-390 York Street
Windsor Hotel
31 John Street, North
Lakeside Hotel
1151 Beach Boulevard
New Dynes Hotel
2)Z7 Beach Boulevard
Junction Hotel
Joffre Hotel
Plantation Hotel
R. R. 3
Hanover Inn
Durham Road
Queen's Hotel
Durham Road
Union Hotel
Coronation Hotel
Elora Street
Royal Inn
Elora Street
Royal Hotel
Bridge & Water Streets
Bridge Inn
139 Main Street, West
NAME OF OWNER
Bencekovich, P. and
Holetic, M.
Vasileff, D.
Schwartz, Mrs. H.
Kisil, Wm.
Donohue, J. J.
Munro, Misses A. B. and
M.
Appleyard, Mrs. C.
Whitmore Hotel Limited
Wilson, J.
J. Ross Fischer Hotels
Limited
Perry, Miss G.
Wiwchar, M.
Gendron, A.
Cayen, L. B.
DeGeer, Mrs. L. A.
Kormann, H. L.
Francis, Mrs. L. L.
Deratnay, E.
Watier, J. E.
Parke, G. E. and G. M.
Jones, E. W.
Montpetit, O.
24
ANNUAL REPORT OF
No. 52
MUNICIPALITY
HAWKESBURY
HAWK JUNCTION
HEARST
HEIDELBERG
HENSALL
HEPWORTH
HERON BAY
HESPELER
HIGHLAND CREEK
HILTON BEACH
HOLTYRE ■
HONEY HARBOUR
HORNEPAYNE
HUDSON
HUMBER BAY
HUMBERSTONE
HUNTSVILLE
NAME OF HOTEL
King Edward Hotel
Royal Hotel
24 Main Street. West
Hawk Junction Hotel
Palace Hotel
Ninth Street
Queen's Hotel
Ninth Street
Waverley Hotel
Windsor Hotel
Olde Heidelberg Inn
New Commercial Hotel
Royal Hotel
Queen Street
North Shore Hotel
Hespeler Hotel
Queen's Hotel
Highland Inn
Hilton Beach Hotel
LaSalle Hotel
Delawana Inn
Royal Hotel
Hornepayne Hotel
Taylor's Hotel
Grandview Hotel
Hollywood Hotel
Queen & W' esley Streets
Humber Hotel
63 Lakeshore Road
Duke's Hotel
154 Main Street
Western Hotel
129 Main Street
Bayview Hotel
100 Main Street
NAME OF OWNER
Lalaonde, E. J.
Martineau, O.
Flanagan, Wilfred G. and
Lillian V.
Charpentier, F.
Knipprath, H.
Groothelm, E.
Dupont, R. and Chabot, L.
Giesler, H. C.
Tudor, S.
Bonser, Robt. A.
North Shore Hotel Co.
Limited
Jaras, Martin
Cornell, J. S.
Maxwell, W.
Wells, S.
LaSalle, J. P.
Grise, F. S. and G. E.
Grise iBros. Limited
Easton, Mrs. F.
Taylor, R. J. and
Mrs. A. M.
Gastmeier, R. J.
Gentile, F.
Begley, |. and Estate of
W. A. Taylor
Offord, A. G.
Reeb, W. G.
Dopper, T. S.
LIQUOR AUTHORITY CONTROL BOARD
25
MUNICIPALITY
HUNTSVILLE
IGNACE
IRON RIDGE
ISLINGTON
JACKFISH
JACKSON'S POINT
JAMOT
JARVIS
JASPER
JONES FALLS
JORDAN
<<
KALADAR
KAPUSKASING
KEARNEY
KEARNS
KEEWATIN
KENOGAMI LAKE
KENORA
NAME OF HOTEL
Dominion Hotel
Main Street
Ignace Hotel
Front Street
Rod & Gun Hotel
Islington Hotel
4922 Dundas Street, West
NAME OF OWNER
Stirling, Mrs. L.
Smilsky, Wm.
Milligan, C. E. and E.
Estate of Mrs. E. E.
McDonnell
Six Points Hotel H. F. Fleury Co. Ltd.
5179 Dundas Street, West
Lakeview Hotel
Lake Simcoe Hotel
Kenwood Hotel
Beausejour Hotel
Jarvis Hotel
Jasper Hotel
Kenney Hotel
Dwarf Village Inn
Jordan Inn
Kaladar Hotel
Commercial Hotel
5 O'Brien Avenue
Empire Hotel
30 Henderson Avenue
Kapuskasing Inn
Plaza Hotel
Queen & Dallyn Streets
Radio Hotel
Henderson & O'Brien Sts
Sunshine Hotel
Kearney Hotel
Park Hotel (New)
Bay City Hotel
Front & Main Streets
Lakeshore Hotel
Kenogami Hotel
Commercial Hotel
101 Chipman Street
Spadoni Bros. Ltd.
Gilbey, W. E.
Farrell, J.
Bouverat, J. P. L.
Slack, W. R.
Watson, B.
Kenney, Thos. J.
Bolus, Mrs. E.
Harding, E. W.
Brydson, Mrs. I. M.
Desgrosielliers, C.
Paquette, J.
Spruce Falls Power and
Paper Co. Ltd.
Godin, C. M.
Spooner, F. J.
Lefebvre, A.
Whittaker, J.
Ferianz, M. and Korbel, J.
Rochon, Mrs. G.
Grendys, W.
Malnerich, P.
Pidlubny, G. and
Barrieau, J.
26
ANNUAL REPORT OF
No. 52
MUNICIPALITY
KENORA
KEYSTONE ISLAND
KILIvALOE STATION
KING KIRKLAND
KINGSTON
KINGSVILLE
KIRKLAND LAKE
NAME OF HOTEL
Dalmore Hotel
Main Street
Kenricia Hotel
Main & Second Streets
Lake of the Woods Hotel
132 ]\Iatheson Street
Ottawa Hotel
219 Matheson Street, S.
Keystone Camps (New)
Beresford Hotel
Queen & Lake Streets
King Kirkland Hotel
British American Hotel
42-52 Clarence Street
Frontenac Hotel
178 Ontario Street
Grand Hotel
76 Princess Street
LaSalle Hotel
Bagot Street
Plaza Hotel
46 Montreal Street
Prince George Hotel
200 Ontario Street
Queen's Hotel
125 Brock Street
Royal Hotel
342 Princess Street
New Windsor Hotel
205 Princess Street
Kingsville Hotel
Main Street
Mettawas Hotel
Park Street
Bellevue Hotel
2 Taylor Avenue
Capitol Hotel
60 Second Street
Charlie's Hotel
34 Government Road, W.
Federal Hotel
Federal & Day Streets
NAME OF OWNER
Estate of J. W. Sauerbrei
Kenricia Hotel Company
Limited
Corneillie, H.
McKay, R.
Fischer, R. S. and Chas.
Hanson, C. R.
Lapierre, A.
Megaffin, N. D. and
Epstein, L. W.
Hyde, H. A.
McGall, T.
Randolph Hotel Co. Ltd.
Johnson, H. M.
Fitton, Mrs. S. L.
Berrigan, T., E. A., and
M.J.
Kingston Hotel Co. Ltd.
Giimour, Mrs. J. S.
Vassar, J. S., A. A., and
Weir, Bert
Mettawas Hotel Co. Ltd.
LaPointe, R.
New Townsite Hotel Co.
Ltd.
Chow, C.
Beauchesne, J. O.
LIQUOR AUTHORITY CONTROL BOARD
27
MUNICIPALITY
KIRKLAND LAKE
KITCHENER
LAMBTON
LANCASTER
NAME OF HOTEL
Franklin Hotel
60 Government Road, W.
Gold Range Hotel
45 Government Road, W.
Kirkland Lake Hotel
55 Government Road, W.
Link Club Hotel (New)
4 Government Road
Park Lane Hotel
2 Government Road, W.
Prince George Hotel
95 Government Road
Princess Hotel
1 Government Road, W.
Queen's Hotel
40 AlcCamus Avenue
Union Hotel (New)
9 Main Street
Windsor Hotel
43 Government Road, W.
York Hotel
8 Main Street
American Hotel
I Queen Street, North
East End Hotel
312 King Street, East
Grand Union Hotel
130 King Street, West
Kitchener Hotel
101 King Street, East
Mayfair Hotel
II Young Street
Station Hotel
122 Weber Street, West
Walper Hotel
1 King Street, W^est
Windsor Hotel
168 King Street, West
Lambton Hotel
4062 Dundas Street, W.
Commercial Hotel
NAME OF OWNER
Bedner, P. J.
Atkins, B.
Elliott, H. E.
Lingenfelter, W. J.
Princess Hotel Limited
Desgroseilliers, C.
Princess Hotel Limited
Desgroseilliers, L.
Pavlakovich, F. and
Michelcic, Joseph
Kaplan, H.
Northern Hotel
(Kirkland Lake) Ltd.
Wagner, M.
Mihiloff, E.
Wismer, A. O.
Kitchener Hotels Limited
Mayfair Hotel Limited
Chris, S.
Kitchener Hotels Limited
Estate of C. J. Bruder
Thomson, C. P. and
Eraser, R. G.
Leigh, Maurice
28
ANNUAL REPORT OF
No. 52
MUNICIPALITY
LARDER LAKE
LaSALLE
LATCHFORD
LAVIGNE
LEAMINGTON
LEFAIVE
LINDSAY
LINWOOD
LISTOWEL
LONDON
NAME OF HOTEL
Grainger Hotel
205 Godfrey Street
Larder Lake Hotel
Chateau LaSalle
Front Road
Sunnyside Hotel
Lady Evelyn Hotel
Lavigne Hotel
Auto Stop Inn
International Hotel
35 Erie Street, South
Leamington Hotel
Seacliffe Hotel
Erie Street, South
Pregent Hotel
Benson House
24 Kent Street
Central Hotel
7 William Street, South
Grand Hotel
171 Kent Street, West
Kent Hotel
34 Lindsay Street, South
New Royal Hotel
2 Kent Street
Linwood Hotel
Royal Hotel
Wallace Street
York Hotel
Main Street
Belvedere Hotel
1033 Dundas Street
Brunswick Hotel
331 Talbott Street
C.P.R. Hotel
671 Richmond Street
Clarendon Hotel
367 Talbot Street
Esquire Hotel
372 Dundas Street
NAME OF OWNER
Grainger, J. H,
Dobrijevich, I,
Lavin, John H.
Terpankis, D,
Burns, M.
Martin, J. R.
Vlasic, I.
Estate of H. A. Shamess
Brown, M.
Seacliffe Hotel Limited
Pregent, A.
Egan, R. V. and
Dawe, W. A.
Maunder, D. J.
Bland, Sam
Parkin, S., Muzyka, J. and
Pary, W.
Adam, J. S. and Fralick,
C. A.
Thompson, R. L.
Fischer, J. R.
Fischer, J. R,
Parsons, A.
Herbert, W. H.
Richardson, Mrs. E.
Deratnay, M.
Aitken, G. S.
LIQUOR AUTHORITY CONTROL BOARD
29
MUNICIPALITY
LONDON
LONG BRANCH
LONG LAC
LORETTO
NAME OF HOTEL NAME OF OWNER
Fraser Hotel Fraser, A and G.
183 King Street
Grigg House Vallance, F. T.
York & Richmond Streets
Harvey Hotel
750 Hamilton Road
Iroquois Hotel
367 Clarence Street
London Hotel
279 Dundas Street
London House Hotel
415 Talbot Street
Mayfair Hotel
89 King Street
Oxford Hotel
769 Adelaide Street
Park Hotel
920 Dundas Street
Queen's Hotel
763 Dundas Street
Richmond Hotel
370 Richmond Street
Ridout Hotel
346 Ridout Street
St. Regis Hotel
625 Dundas Street
Savoy Hotel
398 Clarence Street
Sunnyside Hotel
732 Dundas Street/
Victoria Hotel
466 Ottaway Avenue
Wellington Hotel
267 Bathurst Street
York Hotel
216 York Street
Eastwood Park Hotel
1585 Lakeshore Road
Long Branch Hotel
Long Lac Hotel
Loretto Hotel
Vassar, A. A., J.
Weir, B.
Downey, D. M.
S., and
London Realty Company
Limited
Brennan, Mrs. M. M. and
Clark, Mrs. A. M.
Wakeam, A. K.
Mayor, M. J.
Deeside Holdings Limited
Jones, J. W.
Cook, W. L.
Kelly, B. L.
Jacques, H. A.
Vassar, J. S., A. A., and
E. C.
Hassan, A.
Ginsberg, H.
Escaf, R.
Assaf, A.
Laurent, P. G.
Wright, S. T.
Gaffney, T. J. and Mrs. A.
McCabe, Mrs. M. and
Wilson, W. J.
30
ANNUAL REPORT OF
No. 52
MUNICIPALITY
L'ORIGNAL
LUCAN
MADOC
MAGNETAWAN
MALDEN
MALDEN
TOWNSHIP
MARATHON
MARKSTAY
MARLBANK
MARMORA
MARTIN LAKE
MARYHILL
MARYSVILLE
MASSEY STATION
MATACHEWAN
MATTAWA
((
MAYNOOTH
McGregor
McINTOSH SPRINGS
mcKEnzie island
McKERROW
MEADOWS! DE
MERRICKVILLE
MERRITTON
NAME OF HOTEL
Riverview Hotel
Central Hotel
Main Street
Blue's Hotel
Durham Street
Schmeler Hotel
Meadows Hotel
Lake Shore Hotel
R.R. 2, Amherstburg-
Everest Hotel (New)
Markstay Hotel
O. K. House
Queen Street
Royal Hotel
Forsyth Street
Beaverland Hotel
Commercial Hotel
Scherrer Hotel
Marys vi lie Hotel
Clifton Hotel
Park Hotel
Radio Hotel
Riverview Hotel
Mattawa Hotel
Trans-Canada Hotel
Arling-ton Hotel
McGregor Hotel
Mcintosh Hotel
Gold Eagle Hotel
McKerrow Hotel (New)
Meadow Inn
Louis Hotel
St. Lawrence Street
Merritton Hotel
157 Merritt Street
NAME OF OWNER
Dubois, Florent
Parker, J. S.
Blue, L. C.
Schmeler, W. E.
Meadows Hotel Limited
Kilgallin, T. V. and
Ouellette, W. J.
Harbour Heights Ltd.
Hillman, H. and
St. Denis, J. N.
Schell, S. P.
Neath, H. J.
Handley, A. J. J.
Halter, T, E., I., T, C,
and W.
Scherrer, Mrs. M.
Fahey, J. V".
Estate of H. J. McNenly
Dalpe, J. A.
Bergeron, J. C.
Crow, S. A.
MacKechnie, Mrs. K.
Morel, Mrs. B.
Painter, Wm. B.
Tiffin, L.
Tremblay, H.
Gold Eagle Hotel Co. Ltd.
Dominic, Alex
Renaud, H.
Crawford, G. R.
Ricci, Mrs. D.
LIQUOR AUTHORITY CONTROL BOARD
31
MUNICIPALITY
MERRITTON
MILDMAY
MILFORD BAY
MILLE ROCHE
MILTON
MILVERTON
MIMICO
MINAKI
MINDEN
<<
MINE CENTRE
MINETT
MISSANABIE
MITCHELL
MITCHELL'S BAY
MORRISBURG
MOULINETTE
MOUNT FOREST
NAME OF HOTEL
Union Hotel
123 Merritt Street
Commercial Hotel
Station Hotel
Baycliff Inn
Ernie's Hotel
Kennedy Hotel
Main Street
Milton Inn
Main Street
Winston Hotel
Main Street
Sagamore Hotel
160 Lakeshore Road
Windsor Hotel
15 Vincent Street
Hoist Point Hotel
Dominion Hotel
Rockcliffe Hotel
Mine Centre Hotel
Paignton House
Kinahan's Hotel
Curran Street
Hicks House
Huron Street
Collison House
Main Street
Royal Hotel
Huron Street
Mitchell's Bay Inn
Riverside Hotel
St. Lawrence Hall Hotel
Main & Lock Streets
Windsor Hotel
Lock Street
Lion Hotel
Belmont Hotel
NAME OF OWNER
Hallett, Mrs. I.
Houghton, J.
Weatherhead, C. T.
Campbell, J. H.
Runions, E. N.
Kennedy, Mrs. R.
Armstrong, F. W.
McNair, A. D.
Doughty, Mrs. B. J.
Ryan, V. G.
Smith, H. E. and Ritz,
Mrs. G.
Watson, K. B.
Campbell, Mrs. M. and
Winch, L. S.
Estate of Mrs. M. Law
Pain, R. D.
Kinahan, F. M.
Taylor, Mrs. M. S.
Dungey, W. J.
Cox, J. J.
Pinsonneault, L.
Geach, R. W.
McGannon, W. A. and
Mrs. K.
Ouderkirk, P. E.
Whiteside, T. D.
ColHns, M. J.
32
ANNUAL REPORT OF
No. 52
MUNICIPALITY
MOUNT FOREST
NAIRN CENTRE
NAKINA
NAPANEE
NEUSTADT
((
NEWCASTLE
«
NEW DUNDEE
NEW HAMBURG
NEW LISKEARD
NEWTONBROOK
NEW TORONTO
NIAGARA FALLS
NAME OF HOTEL
Kent Hotel
Main Street
Mount Royal Hotel
Main Street
King George Hotel
Mclntyre Street
Nakina Hotel
Railway Avenue
Campbell House
Dundas Street
Paisley Hotel
John Street
Queen's Hotel
John Street
Richelieu Hotel
Dundas Street
Commercial Hotel
Hill Street
Locust Inn
Elmhurst Hotel
Queen's Hotel
Barton's Inn
Main Street
Commercial Hotel
Imperial Hotel
King Edward Hotel
Waterloo Street
Grand Union Hotel
Whitewood Avenue
Windsor Hotel
Armstrong Street
Algonquin Hotel
Almont Hotel
1072 Lakeshore Road
New Toronto Hotel
781 Lakeshore Road
Belleview Hotel
499 Ferguson Avenue
Bon Villa Hotel
2565 Lundy's Lane
NAME OF OWNER
Thorlby, G. E.
Hahn, O. J.
Zangari, N. G.
Ellis, E. F.
Luffman, M. B.
Tyson, Edward and
Mrs. Jessie A.
Munroe, Mrs. M.
Goodridge, S. D.
Himmelspach, J. P.
Griffiths, Mrs. E. C.
Purdy, Mrs. M.
Byras, Limited
Barton, A. E.
Paul, Stanley
Clayton, J.
Zimmerman, G. T.
Evans, Leonard S.
MacLean, A.
Zayats, A. and
Zaraska, W. ' " .
Almont Hotel Limited
Lavelle, H. J.
Distilio, A.
Allen, S. L.
LIQUOR AUTHORITY CONTROL BOARD
33
MUNICIPALITY
NIAGARA FALLS
NIAGARA-ON-THE-
LAKE
NIPIGON
NAME OF HOTEL
Caverley Hotel
816 Bridge vStreet
Clifton Inn
955 Clifton Hill
Elliott Hotel
573 Queen Street
Empire Hotel
238 Bridge Street
Erie Hotel
356 Bridge Street
Fox Head Inn
Clifton Hill
General Brock Hotel
1685 Falls Avenue
Imperial Hotel
290 Bridge Street
King Edward Hotel
659 Clifton Avenue
Maple Leaf Hotel
1831 Ferry Street
Metropole Hotel
Bridge Street
Niagara Hotel
1008 Centre Street
Park Hotel
Queen Victoria Park
Prospect Hotel
1951 Main Street
Rapids Hotel
67 River Road
Stevens Hotel
152 Bridge Street
Venetian Hotel
1355 Ferry Street
American Hotel
Prince of Wales Hotel
Picton Street
Riverside Hotel
International Hotel
Main Street
NAME OF OWNER
Badovinac, E.
Benson, W. P. and
Gillespie, Alan C.
Sanson, A. V.
Stawchan, M.
Zinkewich, M.
Fox, Mrs. E. M.
General Brock Hotel
Company Limited
Doyle, E. J.
Mark Egan Hotels Ltd.
McGarry, T. W.
Cohen, Max and Dawe,
William A.
Campaigne, C. W.
Niagara Parks
Commission
Prospect House Limited
Pepe, J.
Vukmanich, C.
Briand, J.
Hartzig, M.
Sadowey,
Stevens, Bernard
DeFazio, Mrs. M.
Nipigon Inn
Hogan, W.
34
ANNUAL REPORT OF
No. 52
MUNICIPALITY
NIPIGON
NOELVILLE
NORMAN
NORTH BAY
NORTHBROOK
NORVAL
OAKVILLE
OBA
ORIENT BAY
ORLEANS
OSHAWA
NAME OF HOTEL
Ovilio Hotel
Front & Third Streets
Lafayette Hotel
LaSalle Hotel
Norman Hotel
Bay & Ontario Streets
Continental Hotel
72 Main Street
Empire Hotel
Eraser & Mclntyre Sts.
King George Hotel
1 Ferguson Street
Parkview Hotel
14 Oak Street, West
St. Regis Hotel
Main & Klock Avenue
Northbrook Hotel
Hollywood Hotel
Halton Inn
48 Colborne Street
New Murray Hotel
Oakville Hotel
Navy & Colborne Streets
Oakville Inn
Alexander Hotel
Oba Hotel
Royal Windsor Lodge
Orleans Hotel
Central Hotel
9 King Street, West
NAME OF OWNER
Gentile, D.
Daoust, A.
Bergeron, E.
Rychlo, A.
Kerrigan, S. A.
Empire Hotel Co. of
Timmins Limited
Brazeau, W.
Commercial Hotel
Genosha Hotel
70 King Street, East
Queen's Hotel
67 Simcoe Street, West
Cadillac Hotel (New)
394 Simcoe Street, South
Chirico, A.
Mason, W. E.
Courneya, V. C. and E. J.
Ward, Mrs. E. F.
Megaffin, B. A.
Gordon, J. R.
Gray, G. D.
Busk, N. O.
Stoyka, A.
Vihonen, L. P.
Beamish, J. H. and
Eraser, A. E.
Laflamme, E.
Henry, E. M.,
McCrohan, K.,
Chambers, A. L. and
McCrohan, M.
Commercial Hotel
(Oshawa) Limited
Hotel Genosha Limited
McTaggart, Mrs. G. M.
Vassar, Saliste S.
LIQUOR AUTHORITY CONTROL BOARD
35
MUNICIPALITY
OTTAWA
NAME OF HOTEL
Albion Hotel
1 Daly. Avenue
Alexandra Hotel
352 Bank Street
Belle Claire Hotel
227 Queen Street
Belmont Hotel
90 Lyon Street
Bytown Inn
71 O'Connor Street
Canada Hotel
62 Murray Street
Capital Hotel
202 Rochester Street
Capitol Hotel
221 Rideau Street
Carleton Hotel
223 Armstrong Street
Castor Hotel
451 Sussex Street
Chateau Lafayette
44 York Street
Chateau Laurier
Rideau Street
City Hotel
46 Clarence Street
Commercial Hotel
7Z York Street
Dominion Hotel
28 York Street
Duke Hotel
99 Duke Street
Dunkirk Hotel
64 Metcalfe Street
Elmdale Hotel
1084 Wellinsfton Street
Gilmour Inn
363 Bank Street
Grad's Hotel
143 Cambridge Street
NAME OF OWNER
Laframboise, Mrs. S.
Alexandra Operating Co.
of Ottawa Limited
MacMillan, H. C.
Estate of Thomas
Fleming
Brigham, T. G.
Menard, Mrs. A. D.
Antrim Hotels Limited
Weiss, B.
Viau, J. A. P. and Starr,
H. W. J.
Chevrier, E.
Bouris, J., G., and M.
Canadian National
Railways
Raymond, E. J.
Viau, E.
Cyr, Elie
Korsa, N.
Dunkirk Hotel Limited
Laroche, Horace and
Lionel, Executors of
Estate of Ernest La-
roche
Gilmour Inn Limited
Grad's Hotel (Ottawa)
Limited
36
ANNUAL REPORT OF
No. 52
MUNICIPALITY
OTTAWA
PAINCOURT
PALMERSTON
NAME OF HOTEL
Grand Hotel
555 Sussex Street
King Edward Hotel
599 Sussex Street
La Salle Hotel
245 Dalhousie Street
Lord Elgin Hotel
100 Elgin Street
Pacific Hotel
171 Broad Street
Palace Hotel
181 Broad Street
Plaza Hotel
223 Sparks Street
Prescott Hotel
371 Preston Street
Rex Hotel
42 Clarence Street
Richelieu Hotel
62 York Street
Rideau Hotel
191 Rideau Street
Ritz Hotel
352 Somerset Street, West
Royal Hotel
255 Rideau Street
Russell Hotel
596 Sussex Street
St. Charles Hotel
200 Queen Street
Stirling Hotel
123 Stirling Avenue
\'endome Hotel
844 Somerset Street, W.
Victoria Hotel
34 Murray Street
Windsor Hotel
35 Metcalfe Street
Central Hotel
Dover Hotel
Hess Hotel
NAME OF OWNER
Delorme, L.
Terminal Hotels Limited
Lepine, Mrs. O.
Ford Hotel Company of
Ottawa Limited
Dore, L.
Viau, T.
Plaza Hotel Company
Limited
Prescott Hotel Company
Limited
Barbeau, O.
Lepine, Mrs. C.
Viau, O.
Ottawa Ritz Hotel
Company Limited
Davis Hotel Company
Limited
Russell Operating
Company Limited
St. Charles Hotel Limited
Stirling Hotel (Ottawa)
Limited
Kingsbury, G. R.
Charos, P. G.
Windsor Hotel (Ottawa)
Limited
King, Mrs. G.
Trahan, V. S.
Hammond, Mrs. R. E.
LIQUOR AUTHORITY CONTROL BOARD
2>7
MUNICIPALITY
PALMERSTON
PARIS
PARRY SOUND
PEFFERLAW
PELEE ISLAND
PEMBROKE
NAME OF HOTEL
Queen's Hotel
Queen Street
Arlington Hotel
106 Grand River Street
Canadian Hotel
27 Dunfries Street
Hayes Hotel
26 Mechanic Street
New Royal Hotel
11 Mechanic Street
Kipling Hotel
Emily Street
New Belvedere Hotel
PENETANGUISHENE
PERTH
PETERBOROUGH
Belvedere Hotel
Pelee Hotel
Copeland Hotel
48 Pembroke Street, West
Leland Hotel
196 Albert Street
Mackey House
185 Pembroke Street, E.
Pembroke Hotel
200 Pembroke Street
Windsor Hotel
147 McKay Street
Brule Hotel
Main Street
Canada House
85 Main Street
Northern Hotel
Main Street
Imperial Hotel
25 Wilson Street
Perth Hotel
1 Gore Street, West
Revere Hotel
78 Foster Street
American Hotel
189 Hunter Street
Champlain Hotel
173 Charlotte Street
NAME OF OWNER
Jaegar, L.
Ealand, Misses E. M. and
M. B.
Robb, W. B. Sr.
Hayes, G. E.
Hynes, J. W.
Empire Hotel Company
of Timmins Limited
Peebles. A. G. and Kehoe,
C. W.
Beliski, J. P.
Holtze, L. C.
Copeland Hotel Company
Limited
Needham, D. J.
Costin, E. R.
Teevens, J. B.
Cecile, Mrs. B.
Beauchamp, N.
Allen, J. D. and Renton,
A. E.
Weegar, C. W. and
Smart, W. E.
Lambert, Mrs. E. E.
Duby, H. D.
Salisbury, S. R.
Blodgett, Mrs. P.
McGillis Hotel Co. Ltd.
38
ANNUAL REPORT OF
No. 52
MUNICIPALITY
PETERBOROUGH
PETERSBURG
PHELPSTON
PICKERING
PICKLE CROW
PICKLE LAKE
PICTON
PIGEON RIVER
PLANTAGENET
NORTH
POINT EDWARD
PORCUPINE
PORQUIS JUNCTION
PORT ARTHUR
NAME OF HOTEL
Empress Hotel
131 Charlotte Street
Grand Hotel
295 George Street
King George Hotel
172 Simcoe Street
Montreal House
282 Aylmer Street
Queen's Hotel
181 Simcoe Street
Windsor Hotel
144 Brock Street
Blue Moon Hotel
Phelpston Hotel
Rouge Valley Inn
R.R. 2,
Pickle Crow Hotel
Pickle Lake Hotel
Globe Hotel
Main Street
Royal Hotel
Main Street
Pigeon River Hotel
Commercial Hotel
Balmoral Hotel
123 Michigan Avenue
Palmour Hotel
King Street
Canada Hotel
NAME OF OWNER
Empress Hotel (Peterbor-
ough) Limited
Emerson, L. S. and
Crawford, S. B.
Keeler, I. B. and
Tanner, Ray
Loucks, J.
King, N. D. and V. L.
Johnston, Mrs. S. M.
Forler, H. G.
Kenny, D. J.
Griffin, Mrs. P. F.
Pickle Crow Hotel Ltd.
Koval, K.
Cox, J. J.
Healy, F. E. and E. J.
Hurtig, M.
Gauthier, W. J.
Mara, F. J.
Perla, D.
Tremblay, S.
Canadian Northern Hotel Erikkila, I. A. and
130 Cumberland Street, S. Milton, P.
Hodder Avenue Hotel Sisco, J.
479 Hodder Avenue
Kimberley Hotel
191 Pearl Street
Lakeland Hotel
84 Cumberland Street, S.
LaPrade Hotel
102 Cumberland Street, S
Burstrom, G.
Domanski, J.
LaPrade, J. T.
LIQUOR AUTHORITY CONTROL BOARD
39
MUNICIPALITY
PORT ARTHUR
PORT COLBORNE
PORT DALHOUSIE
PORT DOVER
<( <<
PORT ELGIN
<( «
PORT HOPE
NAME OF HOTEL
Alariaggi Hotel
28 Water Street, South
New Ontario Hotel
219 Arthur Street
Prince Arthur Hotel
9 Cumberland Street
Princess Hotel
76 South Cumberland St
Rovalton Hotel (New)
248 Bay Street
Vendome Hotel
125 Cumberland Street, S.
Waverley Hotel
54 North Cumberland St.
Belmont Hotel
King & Charlotte Streets
Colonial Hotel
124 West Street
Commercial Hotel
240 West Street
Gas Line Hotel
R.R. 1
Queen's Hotel
19 Omar Street
Ritz Hotel
201 Welland Street
Star Hotel
264 West Street
Austin Hotel
16 Lock Street
Embassy Hotel
Port Hotel
Commercial Hotel
Norfolk Hotel
Erie Beach Hotel
Arlington Hotel
Queen's Hotel
Ontario Hotel
30 Ontario Street
NAME OF OWNER
Hurtig, M.
Arthur, Mrs. M.
Canadiaan National
Railways
Filipovic, J.
Baccari, Mrs. C.
Burstrom, J. C.
Kelly, J. J.
Holman, A. A.
Milligan, H. F.
Shibley, J. H.
White, O. W.
Radvilas, J.
Farrarelli, Mrs. P.
Sheppard, W. J.
Austin Hotel Limited
Long, L.
Chaikowski, O. and
Kmit, Y.
Montgomery, L. A.
Gamble, C. E.
Brugos, Mrs. M. and
Almassy, G.
McGrath, E.
McPherson, R.
Powell, B. H.
40
ANNUAL REPORT OF
No. 52
MUNICIPALITY
PORT HOPE
PORT MAITLAND
PORT ROWAN
PORT SEVERN
PORTSMOUTH
PORT STANLEY
POWASSAN
PRESCOTT
PRESTON
PUCE
RAINY RIVER
RAMORE
RED LAKE
NAME OF HOTEL
Queen's Hotel
81 Walton Street
St. Lawrence Hotel
91 Walton Street
Maitland Arms Hotel
Baycliffe Hotel
Main Street
St. Charles Hotel
Main Street
Bayview House
Portsmouth Hotel
402 Young Street
Clifton Hotel
Hill Crest Inn
Plaza Hotel
William Street
Why Not Hotel
Windsor Hotel
Queen Alexandra Hotel
King- Street
NAME OF OWNER
Overholt, H. F.
Halick, J.
Murphy, A. C.
Pickerd, Mrs. M.
Vanthuyne, A.
Brown, Mrs. E. M.
Beaupre, P. M.
Sturgis, C. E.
Shipp, Mr. and Mrs. S. P.
Kohn, Samuel
Weir. Mrs. D.
LaLonde, C. J.
Horan. E. T. and }. T. and
White, E. T. ■
Daniels Hotel (New) Korsa, Nicholas
Central Hotel
868 King Street
Commercial Hotel
991 King Street
Queen's Hotel
1102 King Street
Sulphur Springs Hotel
240 King Street
Emerv's Corners Hotel
R.R. i
Canadian Northern Hotel
Atwood Avenue
Rainy River Hotel
Commercial Hotel
Ramore Hotel
Railway Street
]\IcCuaig Hotel
Taylor, S. A. and
Dawe, W. A.
Forler, H. G.
Schmalz, A. J.
Markus, J.
Anton, J.
Popowich, Wm.
Alakarchuk, Airs. A.
Bienvenu, J.
Delves, G. W.
McCuaig (Red Lake)
Hotel Co. Ltd.
LIQUOR AUTHORITY CONTROL BOARD
41
MUNICIPALITY
RED ROCK
RIDGETOWN
RIDGEWAY
RIVER CANARD
<( ((
RIVERSIDE
RIVER VALLEY
ROCKLAND
ROSSEAU
ROSSPORT
ROUGE HILLS
ROYAL MUSKOKA
POST OFFICE
RUSSELL
ST. AGATHA
ST. ALBERT
ST. ANNE DE
PRESCOTT
ST. CATHARINES
NAME OF HOTEL
Red Rock Inn
Arlington Hotel
McLeod House
Ridge Inn Hotel
Marion Inn
Palm Beach Hotel
Edgewater Hotel
4912 Riverside Drive
Island View Hotel
3342 Riverside Drive
Menard's Inn
196 Riverdale Avenue
Lauzon Stop Inn
3340 Ottawa Street
Rendezvous Hotel
7324 Riverside Drive
Golden Rose Hotel
Main Street
King George Hotel
143 Laurier Street
Rockland Hotel
Russell Hotel
Monteith Inn
Rossport Inn
Glen Eagles Manor
Royal Muskoka Hotel
Commercial Hotel
Russell Hotel
Mill Street
Prince of Wales Hotel
Russell House
Commercial Hotel
City Hotel
131 King Street
Esquire Hotel
88 Queenston Street
NAME OF OWNER
Brompton Pulp and Paper
Company Limited
Campbell, W. T.
Rice, P. A.
Kisielis, A.
Dumouchelle, Mrs. P.
Desjardin, Mrs. A.
Thomas' Inn Limited
Island View Hotel
Company Limited
Menard, Mrs. V.
Bacon, G.
Vuicic, C.
Giroux, A. J.
Gamelin, A.
Viau, A.
Menard, F. X.
Shopsowitz, Harry
Anderson, O.
Dnieper, Peter
Muskoka Lakes Naviga-
tion & Hotel Co. Ltd.
Kiedyk, W. and Mrs. M.
Sculland, M. Frank
Kittell, H. E.
Lauzon, A.
Diotte, R.
Taube, O. and
Cohen, B. M.
Aitken, Mrs. M.
42
ANNUAL REPORT OF
No. 52
MUNICIPALITY
ST. CATHARINES
ST. CHARLES
ST. CLEMENTS
ST. EUGENE
ST. ISIDORE DE
PRESCOTT
ST. JACOBS
ST. JOACHIM
ST. MARY'S
NAME OF HOTEL
Franklin Hotel
2 Pelham Street
Garden City Inn
19 James Street
International Hotel
84 James Street
Leonard Hotel
259 St. Paul Street
Lincoln Hotel
288 St. Paul Street
Mansion Hotel
5 William Street
New Murray Hotel
58 James Street
New Statler Hotel
70 James Street
Ontario Hotel
244 Ontario Street
Queensway Hotel
8 Queenston Street
Russell Hotel
203 St. Paul Street
Welland House
30 Ontario Street
York Hotel
170 York Street
St. Charles Hotel
St. Clements Hotel
Main Street
Windsor Hotel
Central Hotel
Dominion Hotel
King- Street
St. Joachim Hotel
Garnet House
Church Street
Royal Edward Hotel
7 Queen Street
Windsor Hotel
Queen Street
NAME OF OWNER
Rosar, F. N.
Springford, R.
Garbutt, Mrs. I. N.
St. Catharines Hotels Ltd.
McConnell, Mrs. N. R.
Mansion Hotel (St.
Catharines) Limited
Lachapelle, L. A.
Harding, R.
Bagdasarian, M.
Queenston Hotels Limited
O'Keefe, W.
Welland House Limited
York (St. Catharines)
Hotel Limited
Dambrauskas, G.
MacDermott, G.
Landriault, A.
Lalonde, C.
Sieling, H. A.
Rockburn, Harvey
Oddy, Miss F.
Pinney, Mrs. T. G.
Graham, Mrs. O. M.
LIQUOR AUTHORITY CONTROL BOARD
43
MUNICIPALITY
ST. ONGE
ST. THOMAS
SALTFLEET
TOWNSHIP
SANDWICH EAST
SANDWICH WEST
SARNIA
NAME OF HOTEL
Commercial Hotel
Brunswick Hotel
925 Talbot Street
Empire Hotel
664 Talbot Street
Grand Central Hotel
336 Talbot Street
International Hotel
825 Talbot Street
Park House Hotel
95 Wilson Avenue
Royal Hotel
218 Talbot Street
Queen's Hotel
741 Talbot Street
Scott's Hotel
755 Talbot Street
Talbot Hotel
593 Talbot Street
Taylor's Hotel
701 Talbot Street
Western Hotel
87 St. Catharines vStreet
Derby Inn
Airport Inn
Walker Rd. & Highway
Canada Hotel
5923 Tecumseh Road
Samson Hotel
2508 Tecumseh Road
Lappan Hotel
1101 Walker Road
Sand Hill Hotel
R.R. 1
Colonial Hotel
156 Christina Street
McFee's Hotel
182 Cromwell Street
Morden Hotel
163 Front Street, North
NAME OF OWNER
Brisson, H. A.
Collins, Mrs. M.
Watts, Mrs. W.
Hunter, H. C.
Turner, L.
Cornfoot, D. H.
Paddon, R. C.
Deratnay, M.
Scott, Mrs. D.
Conley, Mrs. M.
Taylor, A. A.
Turner, D. J. L. and
Hahn, G. K.
Neichenbauer, E. and
Varyu, N.
Sexton, A.
2
Dengel, Mrs. K.
Fleming, A. J.
Lappan, R. J.
Bessette, H.
Morrison, J. F.
McFee, Mrs. A.
Morden, H. E.
44
ANNUAL REPORT OF
No. 52
MUNICIPALITY
SARNIA
SARSFIELD
SAULT STE. MARIE
SAVANT LAKE
SCARBORO
SCARBORO
JUNCTION
NAME OF HOTEL
Sarnia Hotel
234 Front Street, North
Vendome Hotel
124 Front Street, North
Windsor Hotel
210 Christina Street, N.
vSarsfield Hotel
Algoma Hotel
285 Queen Street, East
Algonquin Hotel
864 Queen Street, East
Central Hotel
458 Queen Street, East
Empire Hotel
196 James Street
Grand View Hotel
331 Queen Street, East
International Hotel
141 Huron Street
Lock City Hotel
874 Queen Street, East
New American Hotel
602 Bay Street
New Ontario Hotel
89 Hudson Street
New Toronto Hotel
193 James Street
Nicolet Hotel
304 Albert Street, West
Royal Hotel
2 Queen Street, East
Victoria Hotel
82 Pirn Street
Windsor Hotel
607 Queen vStreet, East
Savant Hotel
Alpine Hotel
1 102 Kingston Road
Mansion House
3313 Danforth Avenue
Scarboro Hotel
8 Danforth Road
NAME OF OWNER
Martin, H. D.
MacFarlane, G. B.
Taylor, C. L.
Raymond, R.
Cohen, W. M. N.
Paterson, P. W.
Breton, Mrs. L.
Milkovich, V. and
Sambol, J.
Brunette, F.
Signoretti, A.
Petroni, E. M.
Camaroli, E.
Juzwow, J.
Culina, J.
Saari, Mrs. F. A.
Keenan, B. P.
Chow, H.
Sault Windsor Hotel Ltd.
Haverluck, J.
McLarney, W. M. and
McNamara, Mrs. F. A.
Mansion House (Toronto)
Limited
Trusler, M. S.
LIQUOR AUTHORITY CONTROL BOARD
45
MUNICIPALITY
SCHUMACHER
NAME OF HOTEL
NAME OF OWNER
SEAFORTH
SEARCHMONT
SELKIRK
SHAKESPEARE
SHANNONVILLE
SHEBANDOWAN
SIMCOE
Emporium Hotel (New) Bosak, Peter
20 First Avenue
Eldorado Hotel
12 First Avenue
Gold Range Hotel
44 First Avenue
Grandview Hotel
40 First Avenue
Pearl Lake Hotel
53 First Avenue
Recreation Hotel
32 First Avenue
Schumacher Hotel
30 First Avenue
Tisdale Hotel
54 First Avenue
Commercial Hotel
Main Street
Dick House
Main Street
Queen's Hotel
Goderich & Main Streets
Searchmont Hotel
Union Hotel
Main & Erie Streets
Shakespeare Hotel
Union Hotel
Pupich, C.
Svaluto, A.
Buchar, Mrs. M.
Klisanich, F.
Larche, Nobile
Zupancic, J.
Pacanic, N.
Dungey, Mrs. F.
Dick Bros.
Lewis, H. and Corby, A.
Sundstrom, P.
Cole, H. M.
Henderson, D. J.
McKone, A. R. and
Mrs. Isabel
Wayside Inn
McKinnon's Inn
Battersby Hotel
Governor Simcoe Hotel Leask, F. A
413 Norfolk Street, North
Rierdon, Misses B. and M.
McKinnon, Mrs. M. B.
Peer, H. E.
SIOUX LOOKOUT
Melbourne Hotel
39 Robinson Street
Norfolk Hotel
41 Norfolk Street
IQueen's Hotel
110 Robinson Street
Clarke's Hotel
62 Front Street
Challenger, D. R. and
C. E.
Dumsha, J.
Ramey, E. V.
Clarke, Mrs. A.
46
ANNUAL REPORT OF
No. 52
MUNICIPALITY
SIOUX LOOKOUT
SMITHS FALLS
SMOOTH ROCK
FALLS
SOUTHAMPTON
SOUTH PORCUPINE
SOUTH WOODSLEE
SPANISH STATION
SPENCERVILLE
SPRINGFIELD
STAMFORD
NAME OF HOTEL
Lakeview Hotel
48 Front Street
Moberly Hotel
158 King Street
Arlington Hotel
21 Beckwith Street
Lee Hotel
Rideau Hotel
20 Beckwith Street
Russell Hotel
2 Beckwith Street
Elite Hotel
Union Hotel
Southampton Hotel
Walker House
High Street
Airport Hotel
Bruce Avenue
Central Hotel
84 Bruce Street
Empress Hotel
89 Bruce Street
Goldfield's Hotel
136 Golden Avenue
Gold Range Hotel
85 Golden Avenue
Queen's Hotel
Elm Inn Hotel
Huron Hotel
Spencerville Hotel
Glen-Rite Hotel
Main Street
Montrose Plotel
R.R. 2
Queen's Hotel
Red Casque Inn
St. Paul Avenue
Uncle Sam's Hotel
R.R. 1
Lundy's Lane
NAME OF OWNER
Dillabough, J. A.
Moberly, Mrs. E. J.
Dillon, J. P. and
McNichol, B. O.
Lee, G. J.
Powers, Mrs. A.
Russell Hotel (Smiths
Falls) Limited
Pilipchuk, Mrs. E.
Thiboutot, X.
Smith, L. A.
Mahon, H.
Moskal, W.
Leone, G. and Cimetta,
Mrs. M.
Cecconi, A., L. and B.
Krasevac, A. and Fera, J.
Dagenais, P.
Percival, T. A.
Ducharme, E.
Ferris, Michael, E.
Reddick, G. W.
xA.nnett, L. G.
Snell, F. A. and
Antonia, J.
Lamkin, A. W.
Holman, A. A.
Manos, H.
LIQUOR AUTHORITY CONTROL BOARD
47
MUNICIPALITY
STEVENSVILLE
STOCO
STONECLIFF
STONEY CREEK
STONEY POINT
STRATFORD
STRATTON
STURGEON FALLS
SUDBURY
NAME OF HOTEL
Commercial Hotel
R.R. 2, Snyder
Stevensville Hotel
Ontario House Hotel
Stonecliff Hotel
Da-Nite Hotel
Jess Hotel
R.R. 5, Hamilton
Pines Hotel
145 Lake Avenue
Aubin Hotel
Stoney Point Hotel
Avon Hotel
388 Downie Street
Dominion Hotel
391 Downie Street
Empire Hotel
164 Downie Street
Kent Hotel
209 Waterloo Street
Mansion House
101 Wellington Street
Queen's Hotel
161 Ontario Street
Windsor Hotel
23 Albert Street
Stratton Hotel
Chalfonte Hotel
King- Street
King Edward Hotel
Queen's Hotel
Main Street
Windsor Hotel
Balmoral Hotel
2 Elm Street, East
Coulson Hotel
68 Durham Street
Frontenac Hotel
14 Durham Street, North
NAME OF OWNER
Willick, Mrs. R. E.
Hawkins, E. J.
Hughes, G. B.
McKechnie, A.
Geekie, Wm.
Jess, C. T.
Phoenix, Mr. and Mrs.
W. C.
LeFaive, A.
Bisnaire, J.
Kerrigan, S. C,
Wilton, Raymond
Dyke, A. E.
Ruf, E. S.
Estate of J. H. Killer
Pinkney, D. McG.
Litt, J. W.
Landry, E.
Boyer, E. D.
Ghiandoni, R. G.
Dompierre, W. E.
Estate of Mrs. H. Chaput
Balmoral Hotel Co. of
Sudbury Limited
Hotel Coulson Limitted
Davis, C. and Estate of
A. Turpin
48
ANNUAL REPORT OF
No. 52
MUNICIPALITY
SUDBURY
SUNDRIDGE
SUTTON
SWASTIKA
TAMWORTH
TAVISTOCK
((
TECUMSEH
NAME OF HOTEL
Frood Hotel
237 Kathleen Street
International Hotel
201 Kathleen Street
King Edward Hotel
88 Elgin Street
Montreal Hotel
70 Elm Street, East
National Hotel
477 Notre Dame Street
New Ontario Hotel
206 Elgin Street
New Queen's Hotel
18 Borgia Street
Nickel City Hotel
252 Hazel Street
Nickel Range Hotel
10 Elm Street, West
Paris Hotel
24 Borgia Street
Prospect Hotel
180 Elgin Street
Sudbury Hotel
300 Elgm Street
Bernard Hotel
Main Street
Mansion House
Sutton Inn
High Street
Swastika Hotel
Queen's Hotel
Arlington Hotel
Oxford Hotel
Woodstock Street
Golden House
61 Tecumseh Road
Paris Hotel
25 Tecumseh Road
NAME OF OWNER
Perkovich, N.
Borovich, P.
Johnson, C.
Pilon, J. H.
Kingsley, F.
Ghiandoni, E.
Riddell Estates Limited
Fabbro, E.
Nickel Range Hotel (Sud-
bury) Limited
Trottier, O. and ]\Irs. Eva
Chyka, J.
Moses, H.
Caswell, D. j.
Jamieson, S. J.
Miller, E.
Boisvert, J.
Courneya, E. J.
Millington, E.
Liebler, A. E.
Pitre, A. P.
Laramie, L.
Renaud's Inn
103 Tecumseh Road
Fraba, C. and Dudley
LIQUOR AUTHORITY CONTROL BOARD
49
MUNICIPALITY
TECUMSEH
TEMAGAMI
THAMESVILLE
THEDFORD
THESSALON
THOROLD
TILBURY
TILLSONBURG
TIMMINS
NAME OF HOTEL
Tecumseh House
10 Tecumseh Road
Goddard's Place Hotel
Ronnoco Hotel
Tecumseh Hotel
Holwell House
Main Street
O'Connor Hotel
Main Street
Sinton Hotel
Main Street
Pine Hotel
141 Pine Street, South
Summit House
Front Street
Thorold Inn
54 Front Street
Welland Hotel
46 Front Street
Empire Hotel
Queen Street
Recess Hotel
Queen Street
Arlington Hotel
Broadway Street
Imperial Hotel
30 Broadway Street
Royal Hotel
11 Broadway Street
Albert's Hotel
52 Mountjoy Street, South
Algoma Hotel
13 Spruce Street, South
Ambassador Hotel
84 Third Avenue
Balmoral Hotel
10 Mountjoy Street, North
Empire Hotel
Spruce Street & Fourth
Avenue
NAME OF OWNER
Hebert, W. A.
Goddard, E. F.
Temagami Outfitting Co.
Ltd.
Walters, C. E.
Powell, G. H.
O'Connor, C. H.
Sinton, S. M.
Kociulym, J.
Ciuniak, W. and Bruch.
M.
Kekic, Peter
Shanks, M. L.
Estate of Barnaby Ballard
Beselaere, R. J.
Kohl, C. W.
Bringloe, Mrs. A. E.
Hahn, G. K.
Mongeon, J. A.
Tremblay, J. A.
Boutron, K.
Horvat, J.
Empire Hotel Company of
Timmins Limited
50
ANNUAL REPORT OF
No. 52
MUNICIPALITY
TIMMINS
TODMORDEN
TORONTO
NAME OF HOTEL
Grand Hotel
56 Third Avenue
G. V. Hotel
94 Sixth Avenue
International Hotel
14 Cedar Street, North
Kingston Hotel
3 Third Avenue
Lady Laurier Hotel
34 Second Avenue
Maple Leaf Hotel
8 Balsam Street, South
Mount Royal Hotel
13 Cedar Street, South
Northern Hotel
106 Third Avenue
Riverview Hotel
4 Mattagami Boulevard,
South
Russell Hotel
2 Wilson Avenue
St. Charles Hotel
16 Cedar Street, South
Standard Hotel
102 Pine Street. South
Three Star Hotel
13 Maple Street, North
Timmins Hotel
56 Fourth Avenue
Welcome Hotel
7 Spruce Street, South
Windsor Hotel
6 Cedar Street, South
Todmorden Hotel
1067 Broadview Avenue
Adelaide Hotel
127 Simcoe Street
Alexandra Hotel
102 Queen Street, West
Angelo's Hotel
144 Chestnut Street
Avion Hotel
434 Gerrard Street, East
NAME OF OWNER
Cimetta, Nick and
Mrs. Mary
Varteniuk, G.
Diemert, G. M.
Ursaki, P. and Irimie, V.
Lady Laurier Hotel Ltd.
Kotze, P.
Curik, N. and Moskol, W.
X'aillancourt, N.
A'aillancourt, O. and E.
Hass, Mrs. I.
Vaillancourt, N. Lyrette,
G. and Robillard, A.
Galipeau, Mrs. E. M.
Plut, A.
Jamsa, Mrs. Alma
Denisavitch, Mrs. O. and
Lavrich, L.
Windsor Hotel
(Timmins) Limited
Hamer, A. and Mrs. M.
Sniderman, H. A
Humeniuk, j.
Belfanti, A.
Campbell, W. G. and
Garrity, D.
LIQUOR AUTHORITY CONTROL BOARD
51
MUNICIPALITY
TORONTO
NAME OF HOTEL
Avonmore Hotel
276 Jarvis Street
Babloor Hotel
1163 Bay Street
Baltimore Hotel
90 York Street
Benlamond Hotel
666 Kingston Road
Beresford Hotel
250 Queen Street, East
Beverley Hotel
240 Queen Street, West
Biltonia Hotel
147 Dundas Street, East
Bloor Hotel
1313 Bloor Street, West
Breadalbane Hotel
2-8 Breadalbane Street
Broadview Hotel
106 Broadview Avenue
Brockton Hotel
1543 Dundas Street, West
Brunswick Hotel
481 Bloor Street, West
Cameron Hotel
408 Queen Street, West
Canada Hotel
134 Sherbourne Street
Carls-Rite Hotel
174 Front Street, West
Chateau Dufferin
1655 Dufferin Street
Claremont Hotel
734 Queen Street, West
Clifton Hotel
298 Queen Street, West
Clinton Hotel
693 Bloor Street, West
Albany Hotel
158 King Street, East
Columbia Hotel
2 Ossington Avenue
NAME OF OWNER
Torno, E.
Crooks, G. L.
Perille, J. L.
Harris, Mrs. R., V. and W.
Waxman, A., Glass, M.
and A.
Markle, W. W.
Bilton, E. E.
Sparkes, R. P.
Breadalbane Hotel Ltd.
Dunlop, A. E.
Brockton Hotel Limited
Davidson, Mrs. K. C.
Goldstein, M.
Wade, L. M.
Peninsula Hotel Co. Ltd.
Chateau Dufferin Limited
Wade. F. M.
Bobechko, P. and
Yasmanicki, J.
Clinton Flotel Limited
Diakiw, John
Walker, W. J.
52
ANNUAL REPORT OF
No. 52
MUNICIPALITY
TORONTO
NAME OF HOTEL
Commerce Hotel
154 Danforth Avenue
Commodore Hotel
2112 Danforth Avenue
Coxwell Inn
1544 Danforth Avenue
Derby Hotel
393 King Street, East
Danforth Hotel
2763 Danforth Avenue
Dennis Hotel
238 Broadview Avenue
Dominion Hotel
500 Queen Street, East
Drake Hotel
1150 Queen Street, West
Duke of Connaught
Hotel
458 Queen Street, West
Duke of York Hotel
1225 Queen Street, East
De France Hotel
30 Hayden Street
Edgewater Hotel
10 Roncesvalles Avenue
Edwin Hotel
650 Queen Street, East
Elliott Hotel
63 Shuter Street
Embass}' Hotel
7 Bellair Street
Eton Hotel
710 Danforth Avenue
Everene Hotel
467 Jarvis Street
Forbes Hotel
72 Shuter Street
Ford Hotel
595 Bay Street
Gerrard Hotel
293 Gerrard Street, East
NAME OF OWNER
Walton, Mrs. F. B. and
J. A.
Hershoran, H.
Beer, F. and Estate of
Thomas Hare
Derby Hotel (Toronto)
Limited
Danforth Hotel Co. Ltd.
Melnick, James
Shore, R. A.
Lundy, M. and
GreenJjaum, J.
Dyba, M.
Perkins, F. J.
Hrytzko, M., Zamiszczuk,
J. and Korenowsky, W.
Onazuk, AL, Dimitroff, C.
and Harris, A.
Sher, D. and Saltzman, S.
Elliott Hotel Limited
Embassy Club Limited
Heffering, H.
Edmonds, E.
Forbes, J. D.
Ford Hotel Co. of Toronto
Ltd.
Estate of D. W. Megaffin
LIQUOR AUTHORITY CONTROL BOARD
53
MUNICIPALITY
TORONTO
NAME OF HOTEL
Gladstone Hotel
1208 Queen Street, West
Good Hotel
572 Bay vStreet
Graymar Hotel
31 Jarvis Street
Gregory Hotel
17 Adelaide Street, West
Grovenor Hotel
491 Yonge Street
Hunt's Savarin Hotel
336 Bay Street
Imperial Hotel
54 Dundas Street, East
Isabella Hotel
556 Sherbourne Street
Jarvis Hotel
103 Jarvis Street
King Edward Hotel
37 King Street, East
Lansdowne Hotel
1744 Dundas Street, West
NAME OF OWNER
Gladstone Hotel Limited
Good, Mrs. P.
Meagher, E. J.
Hotel Gregory Limited
Hemstead, C.
Hunt's Limited
Newman, J.
Estate of K. B. Heisey
Ontrot, Mrs. B.
King Edward Hotel
(Toronto) Limited
Lansdowne Enterprises
Limited
LaSalle Hotel Ryan, F. and Mrs. K.
1215 Bloor Street, W^est
Linsmore Hotel Bloom, M.
1298 Danforth Avenue
Maple Leaf Hotel Sullivan, E. J.
955 Gerrard Street, East
McCarron Hotel
115 Victoria Street
Merchant's Hotel
94 Front Street, East
Metropole Hotel
141 King Street, West
Monarch Hotel
12 Clinton Street
Morrissey Hotel
817 Yonge Street
Municipal Hotel
67 Queen Street, West
National Hotel
249 King Street, East
McCarron, J. J.
Harris, Mrs. A.
Atlas Hotel Co. Ltd.
Worters, R.
Morrissey, W. F.
Mintz, I.
Merrydew, G.
54
ANNUAL REPORT OF
No. 52
MUNICIPALITY
TORONTO
NAME OF HOTEL
New Empress Hotel
1 Gould Street
New Statler Hotel
112 Queen Street, West
New Strathcona Hotel
60 York Street
New Windsor Hotel
124 Church Street
Noah's Ark Hotel
2781 Danforth Avenue
Orchard Park Hotel
1684 Queen Street, East
Oxford Hotel
30 King Street, West
Palace Hotel
950 King- Street, West
Paramount Hotel
309 Spadina Avenue
Parkdale Hotel
1302 Queen Street, W.
Park Plaza Hotel
4 Avenue Road
Parkview Hotel
935 Queen Street, West
Piccadilly Hotel
106 King Street, West
Pine Tree Hotel
650y2 Queen Street, West
Prince George Hotel
91 York Street
Rex Hotel
3 St. Patrick Street
Rideau Hotel
335 Jarvis Street
Riviera Hotel
197 King Street, East
Rondun Hotel
2238 Dundas Street, West
NAME OF OWNER
New Empress Hotel Co.
Variety Hotels Limited
Bazar, W. and
Mazurenko, D.
Mullen, J. G.
Convey, E. J. Jr.
General Hotel Co. Ltd.
Ticonic Corporation Ltd.
Finnigan, Mrs. L. M.
Starkman, L.
McDonald, J. G., M., H.
E., Misses M. E. and
K M., and Calver,
Mrs. E. F.
Park Plaza Corporation
Limited
Estate of J. F. Burke
Piccadilly Hotel Co. Ltd.
Fineberg, A.
Prince George Hotel Co.
Ltd.
Hertzman, L.
Bruno, L. D.
Humeniuk, T. and Szyko,
Mrs. M.
Dennie, J. M., E. F., L. N.,
C. A. and Thorndike,
J. S. Sr., J. S. Jr. and
R.
LIQUOR AUTHORITY CONTROL BOARD
55
MUNICIPALITY
TORONTO
NAME OF HOTEL
Rose Hotel
78 Centre Avenue
Rosedale Hotel
1145 Yonge Street
Royal Cecil Hotel
202 Jarvis Street
Royal Oak Hotel
376 Dundas Sttreet, East
Royal York Hotel
100 Front Street, West
St. Regis Hotel
392 Sherbourne Street
Scholes Hotel
203 Yonge Street
Shamrock Hotel
491 Gerrard Street, East
Sheldon Hotel
81 Victoria Street
Simcoe Hotel
508 Eastern Avenue
Spadina Hotel
460 King Street, West
Stafford Hotel
940 Danforth Avenue
Star Hotel
150 Dundas Street, West
Turf Club Hotel
113 Elm Street
Tusco Hotel
235 Jarvis Street
Ulster Arms Hotel
1345 Gerrard Street, East
Union Hotel
71 Queen Street, West
Victoria Hotel
56 Yonge Street
Victory Hotel
418 Bay Street
Village Hotel
51 Elm Street
Walker House Hotel
121 Front Street, West
NAME OF OWNER
Berrin, I.
Gendron, A. S.
Dufferin Construction Co.
Ltd.
Taylor, F. J., C. J., and
Sharpe, R. J.
Canadian Pacific Railway
Company
St. Regis Hotel Limited
Scholes Ltd. (John L.
Scholes)
Best Hotels Limited
Young, H. P.
Fox, C. J.
Spadina Realty Co. Ltd.
Hotel Stafford Limited
Lamb, F. J. and Miss E.
Turf Club Hotel Limited
Tusco Hotel Limited
Corcoran, V. W.
Union Hotel Limited
Victoria Hotel (Toronto)
Limited
Assaf, W. E. and
Mrs. Eva
Bav-Elm Plaza Limited
Walker House Hotel Co.
Ltd.
56
ANNUAL REPORT OF
No. 52
MUNICIPALITY
TORONTO
TRENTON
TROUT CREEK
TROUT MILLS
UPSALA
VAL GAGNE
VANKLEEK HILL
VAN WAGNER'S
BEACH
VERMILION BAY
VERNER
VIENNA
VIRGINIATOWN
WABIGOON
NAME OF HOTEL
Walsingham Hotel
321 Jarvis Street
Waverley Hotel
482 Spadina Avenue
Wembley Hotel
2301 Danforth Avenue
Westminster Hotel
240 Jarvis Street
Westmorland Hotel
254 Jarvis Street
Wheat Sheaf Hotel
667 King Street, West
Winchester Hotel
537 Parliament Street
Windermere Hotel
232 Jarvis Street
Ye Olde Tavern Hotel
358 Bay Street
Gilbert Hotel
50 Dundas Street, West
Quinte Hotel
19 Murphy Street
Royal Hotel
47 Dundas Street, East
New St. James Hotel
101 Murray Street
Evers Hotel
White House Lodge
Upsala Inn
National Hotel
Windsor Hotel
Edgewater Hotel
R.R. 5, Hamilton
Bay view Hotel
Commercial Hotel
New Vienna Hotel
McGarry Hotel
Webster Street
King Edward Hotel
Main Street
NAME OF OWNER
Freeman, A. R.
Waverley Hotel Limited
Firestone, W. and
Abroms, L.
Westminster Realty Co.
Ltd.
Westmorland Hotel Ltd.
Hammall, J.
Wilson, G. A.
Windermere Hotel
(Toronto) Limited
Ye Olde Tavern Hotel
Limited
Kerr, J. A.
Orrill. J.
Sage Enterprises Limited
High, Albert W.
Evers, H.
White, Mrs. D. M.
Nickelson, J. W.
Sancartier, Mrs. M.
St. Denis, P.
Chelar, Marko
Brown, R. D.
Lachapelle, E.
Shelson, R.
Hotel McGarry Limited
Stanford, C. R.
LIQUOR AUTHORITY CONTROL BOARD
57
MUNICIPALITY
WAHNAPITAE
WALFORD
WALKERTON
NAME OF HOTEL
Grand Union Hotel
Hill Street
NAME OF OWNER
Marotta, F.
WALLACEBURG
WARDSVILLE
WARREN
WASAGA BEACH
WATERDOWN
WATERLOO
WATFORD
WAWA
WEBBWOOD
WELLAND
Wilson's Resort (New) Wilson, W. G.
Central Hotel
Hartley House
Queen's Hotel
Jackson Street
Kent Hotel
450 Wallace Street
Tecumseh House
46 Duncan Street
Wallaceburg Hotel
Wallace Street
Wardsville Inn
Main Street
Globe Hotel
Allistonia Hotel
Nottawa Inn
American Hotel
Dundas Street
Kirk House
Main and Dundas Streets
City Hotel
76 King Street, South
Kent Hotel
59 King Street, North
Waterloo Hotel
4 King Street, North
Roche House
Main Street
Watford Inn
Lakeview Hotel
Windsor Hotel
Colonial Hotel
300 King Street
Commercial Hotel
62 King Street
Dexter Hotel
69 Main Street, East
Gibson, Mrs. S.
Schmalz, C. P.
Wood, H.
Van Watteghem, C.
Mahoney, A. J.
Hunter, H. C.
Muir, Thos. A.
Boucher, H. P.
Sandy Beach Hotels Ltd.
Nottawa Inn Limited
Condon, F. E. and
Stanley, Mrs. R. M.
Kirk, J. L., Mrs. A. I. and
Miss M. A.
Henning, O. R.
Snyder, A. C.
Chadder, S. J.
Sproule, G. E.
Hobbs, Mrs. S. A.
Lakeview Hotel (Wawa)
Limited
Cayen, J. N.
Estate of Mrs. C. Cutaia
Sher, D. and Saltzman, S.
Cooper, J. W.
58
ANNUAL REPORT OF
No. 52
MUNICIPALITY
WELLAND
WELLAND
JUNCTION
WELLESLEY
WEST HILE
WESTPORT
WHITBY
WHITEFISH
WHITEFISH FALLS
W^HITE RIVER
WIARTON
WILLIAMSBURG
WILNO
WINDSOR
NAME OF HOTEL
Niagara Hotel
258 King Street
Reeta Hotel
90 Main Street, East
Welland Hotel
3 Niagara Street
Dain City Hotel
Queen's Hotel
Royal Hotel
Queen and William Sts.
West Hill Hotel
Lexena Hotel
Bedford Street
Westport Inn
Royal Hotel
171 Brock Street, North
Spruce Villa Hotel
Whitby Hotel
207 Dundas Street, West
Penage Hotel
High Street
Whitefish Falls Hotel
Green Gables Hotel
Arlington Hotel
Berford Street
Pacific Hotel
Berford Street
Locketon Lodge Hotel
Exchange Hotel
Ambassador Hotel
93 Sandwich Street, East
Arcade Hotel
1353 Wyandotte Street, E,
Arlington Hotel
891 Erie Street
Baby Hotel
1683 College Avenue
Bedell Hotel
1444 Ottawa Street
NAME OF OWNER
Morabito, J.
Hotel Reeta Limited
Kunda, John and Mrs.
Stella
Bouk, H. E.
Logel, Jos.
Pirce, Louis
Machibroda, J.
Roberts, H. H.
Garrod, F.
Rosseau, Mrs. R. A. and
A. L.
Purdy, Mrs. M.
Bandel, Miss M. E. and
L.J.
Falzetta, P.
White, S. J.
Bracci, Mrs. L.
Taylor, C. L.
Walker, A. G. and R. A.
Robert, E.
Shulist, Mrs. E.
McNamara Hotels Ltd.
Kozak, J.
Bilson, John and Mrs.
Mary
Baby, H.
Kozak, W. J.
LIQUOR AUTHORITY CONTROL BOARD
59
MUNICIPALITY
WINDSOR
NAME OF HOTEL
NAME OF OWNER
Bellvue Hotel Opacich, S. and
1271 Sandwich Street, E. Mandich, G.
Labadie, E.
Tenenbaum, M.
Blue Water Hotel
128 Windsor Avenue
Border Hotel
428 Wyandotte Street, E.
Bridge Avenue Hotel Vlda, M.
1886 London Street, West
British American Hotel Doumani, E. M.
6-14 Sandwich Street, E.
Chippawa Hotel
3404 Bloomfield Road
Laforet, E. F.
Commodore Hotel Commodore Hotel
25 Chatham Street, East (Windsor) Limited
Coronation Hotel Coronation Hotel
1521 Sandwich Street, W. (Windsor) Limited
Detroit Hotel Detroit Hotel Limited
1211 Drouillard Road
Dixie Hotel Schiller, Mrs. E.
1080 Erie Street, East
Dominion Hotel Boyer, W. H.
3140 Sandwich Street, W.
Drake Hotel
193 Glengarry
Driving Park Hotel
2105 Ouellette Avenue
East Windsor Hotel
1214 Drouillard Road
Erie Hotel
1067 Erie Street, East
Essex House
317 Sandwich Street, W.
Europe Hotel
1638 Drouillard Road
Grand Central Hotel
241 Sandwich Street, East
Grand Hotel
553 Erie Street, East
Highway Hotel
592 Dougall Avenue
Hollywood Hotel
900 Howard Avenue
Uteson, M.
Driving Park Hotel Co.
Ltd.
Poitras, Mrs. B.
Dan, Mrs. A.
Kovarbacih, P. and
Todorovich, G.
Bulat, P.
Graveline, Mrs. E. M.
Grand Hotel (Windsor)
Limited
Heffernan, H. A.
Schulde, J. P.
60
ANNUAL REPORT OF
No. 52
MUNICIPALITY
WINDSOR
NAME OF HOTEL
Horseshoe Hotel
542 Cataraqui Street
Howard Hotel
1534 Howard Avenue
Imperial Hotel
191 Sandwich Street, W.
International Hotel
932 Drouillard Road
Killarney Castle Hotel
592 Victoria Avenue
Lido Venice Hotel
3885 Sandwich Street, W,
Lincoln Hotel
443 Ouellette Avenue
Maple Leaf Hotel
1629 Howard Avenue
Marig-old Hotel
1011 Drouillard Road
Martin Hotel
1325 Langlois Avenue
Metropole Hotel
917 Walker Road
Monarch Hotel
82 Wyandotte Street, W.
Alunro Hotel
95 Pitt Street, East
Norton Palmer Hotel
130 Park Street, West
Ottawa Hotel
943 Ottawa Street, East
Palace Hotel
939 Drouillard Road
Plaza Arms Hotel
79 Pitt Street, West
Peros Hotel
1056 Wyandotte Street, E.
Prince Edward Hotel
380 Ouellette Avenue
Rex Hotel
116 Drouillard Road
Ritz Hotel
93 Ouellette Avenue
NAME OF OWNER
Irvine, Mrs. M.
Foley, Mrs. Mary
Lee, K.
Shamess, Mrs. N.
Draganitz, M.
Trumble, L.
Lincoln Hotel (Windsor)
Limited
Maple Leaf Hotel
(Windsor) Limited
Zimbalatto, Mrs. C.
Alaica, J. and
Marksity, N.
Metropole Hotel
(Windsor) Limited
May, F. J. and Johnson,
M.
Rusnov, L.
Norton Palmer Hotel Ltd.
Rossi, J.
Moskalyk, Stefan and
Mrs. Jean
Plaza Arms Limited
Bulat, P.
Prince Edward Hotel
(Windsor) Limited
Lysy, M. and Nikon, N.
McNamara Hotels Ltd.
LIQUOR AUTHORITY CONTROL BOARD
61
MUNICIPALITY
WINDSOR
NAME OF HOTEL
NAME OF OWNER
WINONA
WOLFE ISLAND
WOODSLEE
WOODBRIDGE
WOODSTOCK
Royale Hotel Radonich, M. and
4877 Wyandotte Street, E. Tarailo, D.
Royal Oak Hotel Demic, S. and
3260 Sandwich Street, W. Kovarbasic, D.
St. Clair Hotel Sukunda, E.
66 Wyandotte Street, East
Shore Acres Hotel Sutton, H. W.
1981 Sandwich Street, W.
Southwood Hotel
1353 Wellington Street
Star Hotel
792 Gladstone Avenue
Talbot Hotel
581 Elm Avenue
Temple Hotel
2756 Charles Street
Victoria Hotel
400 Chilver Road
Walker House
317 McDougall Street
Wellington Hotel
1159 Elliott Street, West
West Side Hotel
623 Sandwich Street, W.
Westwood Hotel
4280 Sandwich Street, W
Windsor Hotel
156 Windsor Avenue
Woodbine Hotel
139 Goyeau Street
Wyandotte Hotel
892 Wyandotte Street, E
Inns of Innsville
Island Hotel
Rochester Hotel
Elm's Hotel
Pine Street
Bielich, M.
Star Hotel Company Ltd.
May, F. J. and Johnson,
M.
Poitras, N.
Estate of F. H. Laforet
Estate of J. A. Smith
Pelech, H.
Larose, A.
Reaume, E. E.
Jean, L.
Stefuriac, Mrs. E. M.
Yarmoluk, J.
Kyriakopulos, G.
Johnson, M. V.
Grymonprez, C.
Briggs, W. B. Jr.
New Commercial Hotel New Commercial Hotel
15 Graham Street Co. (Mrs. R. Mcin-
tosh ; Misses B. I. and
D. S. Jupp)
62
ANNUAL REPORT OF
No. 52
MUNICIPALITY
WOODSTOCK
YORK MILLS
YORK TOWNSHIP
YOUNG'S POINT
ZURICH
NAME OF HOTEL
Oxford Hotel
28 Finkle Street
Royal Hotel
Southside Hotel
95 Victoria Street
New Jollv Miller Hotel
3885 Yonge Street
Oakwood Hotel
489 Oakwood Avenue
Queensbury Inn
530 Scarlett Road
South Beach Hotel
Dominion Hotel
NAME OF OWNER
Reid, R. H.
Royal Hotel of Wood-
stock Limited
Southside Hotel Company
(Woodstock) Limited
New Jolly Miller Hotel
Limited
Oakwood Hotel Limited
Corcoran, J. J. and
Webster, H.
Lawlor, T. J. and L. K.
Johnston, R. H.
LIQUOR AUTHORITY CONTROL BOARD
63
MUNICIPALITY
AMHERSTBURG
BARTONVILLE
BELLEVILLE
BILLINGS BRIDGE
BRANTFORD
BRIDGEPORT
BROCKVILLE
CHATHAM
COBOURG
ERINDALE
ETOBICOKE
FORT ERIE
FORT ERIE
NORTH
FORT WILLIAM
GERALDTON
GUELPH
CLUBS (SOCIAL)
NAME OF CLUB
Deer Head Club
Glendale Golf & Country
Club Limited
Belleville Club Limited
Ottawa Hunt & Golf Club
Limited
Brantford Club
Polish Alliance Friendly-
Society, Branch No. 10
Polish Mutual Benefit &
Friendly Society
Shriners Club of Brantford
Limited
Grand River Golf &
Country Club
Brockville Club
Chatham Golf & Country Club
Kent Club Corporation
Cobourg Golf Club Limited
Credit Valley Golf Club
Royal York Hotel Golf Club
Limited
Niagara Racing Association
of Ontario
Erie Downs Golf & Country
Club Limited
Benevolent & Protective
Order Elks Ft. William
Lodge No. 82
Fort William Country Club
Limited
Italian Club, Principe di
Piemonte Society
Fort William Club (New)
Kenogamisis Golf Club
Guelph Country Club Limited
Guelph Golf & Recreation
Club Limited
ADDRESS
201 Dalhousie Street
R.R. 1
210 Pinnacle Street
R.R. 2
98 George Street
126 Albion Street
154 Pearl Street
144 Dalhousie Street
22 Court House Avenue
Queen Street
155 King Street, West
919 Division Street
Royal York Road
201 North Syndicate
Avenue
600 McLaughlin Street
116 McVicar Street
Wellingfton Place
ANNUAL REPORT OF
No. 52
MUNICIPALITY
HAMILTON
HANOVER
HUMBER BAY
ISLINGTON
KENORA
KINGSTON
KIRKLAND LAKE
KITCHENER
LAMBTON MILLS
LEASIDE
LONDON
LONG BRANCH
NIAGARA FALLS
NIAGARA-ON-
THE-LAKE
NORTH BAY
NAME OF CLUB
Chedoke Golf Club
Commercial Club Limited
Hamilton Club
Hamilton Thistle Club Ltd.
Hamilton V^ictoria Club Ltd.
Leander Boat Club
Royal Canadian Yacht Club
Saugeen Golf Club
Humber Valley Golf &
Tennis Club
Islington Golf Club Limited
Kenora Golf & Country
Club Limited
Kingston & Frontenac
County Conservative Club
Kingston Curling Club
National Polish Society
(New)
Granite Club
Rockway Golf & Bowling
Club
Westmount Golf & Country
Club Limited
Lambton Golf & Country
Club Limited
Thorncliffe Park Racing &
Breeding Association Ltd.
Hermitage Club
London Club Limited
Marconi Club
Mocha Mosque
Polish National Association
Limited
Toronto Golf Club
Niagara Falls Badminton &
Tennis Club
Niagara-on-the-Lake Golf
Club
Bay Club
ADDRESS
Aberdeen Avenue
4 Vine Street
6 Main Street, East
81 Robinson Street
568 King Street, East
Foot of John Street
McNab Street, North
Brant Township
29 Dilon Avenue
319 Second Street, S.
15 Montreal Street
75 Clergy Street, West
8 Wood Street
67 Agnes Street
Rockway Drive
Scarlett Road
Woodbine Park
368 Richmond Street
177 Queen's Avenue
74 Carling Street
471 Waterloo Street
554 Hill Street
1300 Wilmott Street
Front Street
99 Main Street, West
LIQUOR AUTHORITY CONTROL BOARD
65
MUNICIPALITY
NORTH BAY
OAKVILLE
OSHAWA
OTTAWA
OVERBROOK
PAQUETTE
STATION
PEMBROKE
PETERBOROUGH
PORT ARTHUR
PORT CREDIT
RENFREW
RIDGEWAY
RIVERSIDE
ST. CATHARINES
ST. CLAIR BEACH
(( <<
NAME OF CLUB
North Bay Golf & Country
Club Limited
Oakville Club Limited
Oshawa Golf Club Limited
Association Athletique
Montagnard
Bridge Club of Ottawa Ltd.
Laurentian Club Incorporated
L'Institut Canadian Francais
D'Ottawa
Rideau Club
Rideau Lawn Tennis Club
Limited
Dominion Golf & Country
Club
Pembroke Golf Club Limited
Peterborough Club
Port Arthur Curling Club
Port Arthur Golf & Country
Club Limited
Shuniah Club
Italian Mutual Benefit
Society (New)
Lakeview Golf Club Limited
Mississauga Golf & Country
Club Limited
Renfrew Golf Club Limited
Buffalo Canoe Club
Cherry Hill Club Limited
Riverside Yacht Club Limited
Windsor Yacht Club
St. Catharines Club
St. Catharines Golf Club '
Limited
Beach Grove Golf Club
Lakewood Golf Club Limited
ADDRESS
Water Street
Alexandra Street
693^ Somerset Street,
West
184 Sparks Street
233 Metcalfe Street
123 Rideau Street
84 Wellington Street
126 Simcoe Street
214 Egan Street
Eleventh Avenue
8th Floor, Public
Utilities Building
130 Algoma Street
Dixie Road
Mississauga Road
R. R. 3
Erie Road
Cherry Hill and
Garrison Road
5228 Riverside Drive
4400 Riveiside Drive
77 Ontario Street
34 Westchester Avenue
R.R. l,Tecumseh
R.R. l,Tecumseh
66
ANNUAL REPORT OF
No. 52
MUNICIPALITY
ST. THOMAS
SANDWICH EAST
SANDWICH WEST
SAULT STE.
MARIE
NAME OF CLUB ADDRESS
Hi-Ro Shriners' Club of Elgin 472 Talbot Street
Little River Golf & Country Lauzon Road, R.R. 2
Club Tecumseh
Essex County Golf &
Country Club Ljimited
Algo Men's Club
SCARBORO
SCARBORO
BLUFFS
SIMCOE
SOUTH WINDSOR
STRATFORD
SUDBURY
TECUMSEH
TORONTO
Marconi Social Club
Sault Ste. Marie Golf Club
Sons of Italy Grand Lodge
of Ontario
Troubadour Club
Cedar Brae Golf & Country
Club
Scarboro Golf & Country
Club Limited
Toronto Hunt Club
Cliffside Golf Club
Norfolk Golf & Country Club
Limited
Roseland Golf & Country
Club
Stratford Country Club Ltd.
Idylwylde Golf & Country
Club Limited
Sudbury Golf Club Limited
Sudbury Riding Club (New)
Shawnee Gun & Country Club
Acadian Recreation Club
Limited
Albany Club of Toronto Ltd.
Arlington Athletic Club
Arts & Letters Club
Badminton & Racquet Club
of Toronto
Boulevard Club Limited
Canadian ^Vlilitary Institute
639 Bay Street
450 Albert Street, East
Queen Street, East
Cathcart and Hudson
Streets
120 Gore Street
]*ilarkham Road
1355 Kingston Road
Peel Street
Dougall Avenue
Romeo Street
McKim Township
703 Old Garson Road
Shawnee Road
1797 Danforth Avenue
91 King Street, East
767 Dovercourt Road
14 Elm Street
25 St. Clair Avenue, W.
175 Lakeshore Blvd.
426 University Avenue
LIQUOR AUTHORITY CONTROL BOARD
67
MUNICIPALITY
TORONTO
WALKERTON
WATERLOO
WELLAND
WESTON
WINDSOR
NAME OF CLUB
Carlton Club of Toronto Ltd.
Elm Grove Recreation &
Athletic Club
Engineers' Club* of Toronto
Granite Club Limited
Law Society of Upper Canada
National Club
Ontario Club
Primrose Club Limited
Royal Canadian Yacht Club
St. Andrew's Bridge &
Social Club
Toronto Club
Toronto Ladies Club
Toronto Lawn Tennis Club
Toronto Men's Press Club
Toronto Skating Club
University Club of Toronto
Victoria Skating & Curling
Association of Toronto
Limited
York Club
Walkerton Golf & Country
Club Limited
Waterloo Club Limited
Temple Club
Welland Club Limited
Elm's Golf & Country Club
Oakdale Golf & Country
Club Limited
Pine Point Golf Club
Summerlea Golf & Country
Club
Weston Golf & Country
Club Limited
Border Cities Polish
Canadian Club
ADDRESS
94 Hayden Street
1249 Queen Street, W.
350 Bay Street
63 St. Clair Avenue, W.
120 Queen Street, West
303 Bay Street
16 Wellington St., W.
41 Willcocks Street
Centre Island
3001^ College Street
107 Wellington St., W.
2 Bloor Street, West
40 Rowanwood Avenue
143 Yonge Street
568 Dupont Street
380 University Avenue
277 Huron Street
135 St. George Street
34 Erb Street, East
268 Main Street, East
King Street
Woodbridge Road
Jane Street
200 Gorden Avenue
R.R. 3
1530 Langlois Avenue
68
ANNUAL REPORT OF
No. 52
MUNICIPALITY
WINDSOR
YORK EAST
YORK MILLS
YORK NORTH
NAME OF CLUB
French Canadian Club of
Windsor
Frontier Badminton Club
(Inc.)
Frontier SociaT Club
Othmar Grotto Club
Polish People's Home
Association
Windsor & District
Hungarian Society
Chrymoto Men's Club (New)
Border Cities Italian Club
(New)
Woodbine Golf & Country
Club
St. Andrew's Estates & Golf
Club Limited
York Downs Golf & Country
Club Limited
Rosedale Golf Club
Toronto Cricket Club
ADDRESS
1253 Wyandotte St., E.
4037 Riverside Drive
454 McDougall Avenue
1730 Wyandotte St., E.
1275 Lang-lois Avenue
812 Ottawa Street
2330 McDougall Street
966 Wyandotte St., E.
O'Connor Drive and
Woodbine Avenue
R.R. 2
R.R. 1
1901 Mount Pleasant
Road
Wilson Avenue,
Armour Heights
LIQUOR AUTHORITY CONTROL BOARD
69
CLUBS (VETERAN AND LABOUR)
MUNICIPALITY
ATIKOKAN
AYLMER
BELLEVILLE
BRANTFORD
CALEDONIA
CHATHAM
DUNNVILLE
ELORA
ESSEX
FAIRBANK
FORT ERIE
FORT FRANCES
FORT WILLIAM
GALT
GEORGETOWN
NAME OF CLUB
Canadian Legion B.E.S.L.
Branch No. 145 (New)
Canadian Legion B.E.S.L.
Branch No. 81 (New)
Army & Navy Veterans in
Canada, Unit No. 201
Brantford Ex-Imperial
Veterans' Social Club
Canadian Legion B.E.S.L.
Branch No. 90
Canadian Legion B.E.S.L.
Branch No. 154
Canadian Legion B.E.S.L.
Branch No. 28
Canadian Legion B.E.S.L.
Branch No. 142
Canadian Legion B.E.S.L.
Branch No. 229
Canadian Legion B.E.S.L.
Branch No. 201
Canadian Legion B.E.S.L.
Branch No. 75
His Majesty's Imperial Army
and Navy Veterans'
Association
Canadian Legion B.E.S.L.
Branch No. 71
Canadian Legion B.E.S.L.
Branch No. 29
Army & Navy Veterans in
Canada, Unit No. 257
Canadian Legion B.E.S.L.
Slovak Branch No. 129
Canadian Legion B.E.S.L.
Fort William Branch
Canadian Legion B.E.S.L.
Italian Branch No. 113
Canadian Legion B.E.S.L.
Branch No. 121
Canadian Legion B.E.S.L.
Branch No. 120
ADDRESS
187 Front Street
115 Market Street
20 Colborne Street
29 V^ictoria Avenue
305 Queen Street, East
Metcalfe Street
Talbot Street
31 Shortt Street
2089 Dufferin Street
31 Bertie Street
259 Scott Street
141 Simpson Street
800 Mcintosh Street
226 South May Street
534 McLaughlin Street
15 Walnut Street
Mill Street
70
ANNUAL REPORT OF
No. 52
MUNICIPALITY
GRAVENHURST
GUELPH
HAMILTON
HESPELER
ISLINGTON
NAME OF CLUB
Canadian Legion B.E.S.L.
Branch No. 302
Canadian Legion B.E.S.L.
Branch No. 234
Red Chevron Club (Branch
No. 4 Originals' Club)
Army & Navy Veterans in
Canada, Unit No. 153
British Imperial Club
Canadian Legion B.E.S.L.
Branch No. 7
Canadian Legion B.E.S.L.
Branch No. 58
Canadian Pensioners' Associ-
ation of the Great War
(Hamilton Branch)
Canadian Legion B.E.S.L.
Branch No. 315 (New)
Dominion Foundries & Steel
Overseas Veterans'
Association
Firestone War Veterans'
Association
Fourth Canadian Infantry
Battalion Veterans'
Association (Hamilton
Branch)
His Majesty's Army & Navy
Veterans' Society
Old Contemptibles' Associ-
ation & Social Club of
Hamilton
Veterans of First Canadian
Contingent Social Club
of Hamilton
Veterans' Service League
War Amputations of Canada
Hamilton Branch
Canadian Legion B.E.S.L.
Branch No. 272
Canadian Legion B.E.S.L.
Branch No. 210
ADDRESS
Bay Street
Priory Square
116 Quebec Street, East
119 James Street, North
80y2 James Street, N.
36 Charles Street
Barton and Agnes Sts.
199 King William St.
644 Barton Street, East
1052 Barton Street, E.
1211 Cannon Street, E.
12>4 King Street, West
96 McNab Street, North
1002 Barton Street, E.
235y2 King Street, East
1473 Main Street, East
3453^ Barton Street, E.
Queen Street, West
Bloor Street, West
LIQUOR AUTHORITY CONTROL BOARD
71
MUNICIPALITY
KENORA
KINGSTON
KINGSVILLE
KIRKLAND LAKE
KITCHENER
LEAMINGTON
LINDSAY
LONDON
MARMORA
MERRITTON
MIMICO
MOUNT DENNIS
NEWTONBROOK
NAME OF CLUB
Canadian Legion B.E.S.L.
Branch No. 12
Canadian Corps Association
Branch No. 120
Canadian Legion B.E.S.L.
Branch No. 9
Canadian Legion B.E.S.L.
Branch No. 188
Canadian Legion B.E.S.L.
Branch No. 87
Army & Navy Veterans in
Canada, Unit No. 247
Canadian Legion B.E.vS.L.
Branch No. 50
Canadian Legion B.E.S.L.
Branch No. 84
Canadian Legion B.E.S.L.
Branch No. 67
Army & Navy Veterans in
Canada, Imperial Unit
No. 229
Canadian Legion B.E.S.L.
Branch No. 263
Canadian Legion B.E.S.L.
Branch No. 2
Canadian Legion B.E.S.L.
Branch No. 279
Canadian Legion B.E.S.L.
Roosevelt Branch No. 306
Originals' Club, Inc. of
Ontario, Branch No. 2
Canadian Legion B.E.S.L.
Branch No. 237 (New)
Canadian Legion B.E.S.L.
Branch No. 138
Canadian Legion B.E.S.L.
Branch 217
Canadian Legion B.E.S.L.
Branch No. 31
ADDRESS
334 Second Street, S.
164 Wellington Street
67 Princess Street
Main Street, West
79 Government Rd., W.
33 King Street, East
48 Ontario Street, N.
Memorial Park
12 York Street
340 York Street
70 Dundas Street
1253^ King Street
556 Dundas Street
119>^ Dundas Street
104 Dundas Street
10 Chestnut Street
14 Drummond Avenue
1006 Weston Road
North York Township
Veterans' Association
Yonge Street and
Abitibi Avenue
72
ANNUAL REPORT OF
No. 52
MUNICIPALITY
NEW TORONTO
NIAGARA FALLS
NIAGARA-ON-
THE-LAKE
OAKVILLE
OSHAWA
PARIS
PARRY SOUND
PENETANG
PETERBOROUGH
POINT EDWARD
PORT ARTHUR
PORT COLBORNE
PORT CREDIT
PRESTON
RAINY RIVER
REDDITT
RIVERSIDE
ST. CATHARINES
ST. THOMAS
NAME OF CLUB
Canadian Legion B.E.S.L.
Branch No. 3
ADDRESS
263 Seventh Street
Canadian Corps Association, 1657 Victoria Avenue
Unit No. 104
Canadian Legion B.E.S.L.
Branch No. 51
Canadian Legion B.E.S.L.
Branch No. 124
Canadian Legion B.E.S.L.
Branch No. 114
Canadian Legion B.E.S.L.
Branch No. 43
Canadian Legion B.E.S.L.
Branch No. 29
Canadian Legion B.E.S.L.
Branch No. 117
Canadian Legion B.E.S.L.
Branch No. 68 (New)
Canadian Legion B.E.S.L.
Branch No. 52
Point Edward Ex-Service
Men's Club
Canadian Legion B.E.S.L.
Port Arthur Branch No. 5
1347 Victoria Avenue
King Street
Church and Navy Sts.
90 Centre Street
70 WilHam Street
James Street
217 Murray Street
417 Michigan Avenue
224 Cooke Street
Canadian Corps Association 49 Kent Street
Branch No. 43
Canadian Legion B.E.S.L.
Branch No. 82
Canadian Legion B.E.S.L.
Branch No. 126
Canadian Legion B.E.S.L.
Branch No. 54
Canadian Legion B.E.S.L.
Branch No. 82
Canadian Legion B.E.S.L.
Branch No. 255
Canadian Legion B.E.S.L.
Branch No. 24
Earl French Social Ckib
(Imperial Veterans' Corps)
Canadian Legion B.E.S.L.
Branch No. 41
506 King Street
Third Street
Box 17
1111 Wyandotte Street
111 Church Street
15 George Street
24 John Street
LIQUOR AUTHORITY CONTROL BOARD
IZ
MUNICIPALITY
SARNIA
SAULT STE.
MARIE
SCARBORO
«
SIMCOE
SIOUX LOOKOUT
STRATFORD
SUDBURY
TECUMSEH
THOROLD
TILBURY
TIMMINS
TODMORDEN
TORONTO
NAME OF CLUB
Sarnia Service Club
Incorporated
ADDRESS
286 Front Street, North
Algoma Steel Workers' Club 126 Thompson Street
Canadian Legion B.E.S.L. 343 Queen Street, East
Branch No. 25
Canadian Legion B.E.S.L.
Branch No. 13
Canadian Legion B.E.S.L.
Branch No. 71)
Army & Navy V^eterans in
Canada, Unit No. 255
Canadian Legion B.E.S.L.
Branch No. 78 (New)
Canadian Legion B.E.S.L.
Branch No. 8
Canadian Legion B.E.S.L.
Branch No. 76
Canadian Legion B.E.S.L.
Branch No. 261 (New)
Canadian Legion B.E.S.L.
Branch No. 17
Canadian Legion B.E.S.L.
Branch No. 206
Canadian Legion B.E.S.L.
Branch No. 88
Canadian Legion B.E.S.L.
Branch No. 10
Canadian Corps of
Commissionaires
Canadian Legion B.E.S.L.
Branch No. 1
Canadian Legion B.E.S.L.
Branch No. 42
Canadian Legion B.E.S.L.
Branch No. 11
Canadian Legion B.E.S.L.
Branch No. 65
Earl French Memorial Club
(Operated by the Citizens'
Repatriation League, Inc.)
1577 Kingston Road
2 Robinson Avenue
82 Culver Street
207 St. Patrick Street
49 Elm Street, East
213 Lesperance Rd., S.
3 Orniond Street, South
Queen Street
17 Cedar Street, South
1083 Pape Avenue
(M.A. Toronto 6)
78 Church Street
1403 Gerrard Street, E.
303 Kingston Road
103 Coleman Avenue
6-A Greenlaw Avenue
453 Broadview Avenue
74
ANNUAL REPORT OF
No. 52
MUNICIPALITY
TORONTO
WALLACEBURG
WELLAND
WESTMOUNT
WHITBY
WINDSOR
NAME OF CLUB
Fifteenth Battalion Old
Comrades' Social Club
Fourth Battalion Club
(Toronto Branch)
International Geneva
Association
ADDRESS
97 Yonge Street
14 Queen Street, East
90 Wellington Street,
West
Originals' Club Incorporated Room "F", Yonge
(Overseas 1914)
Roval Naval (Association)
' Club
Sappers' Club of Toronto
Scottish Club
Sir Arthur Currie Memorial
Club (Operated by Citi-
zens' Repatriation League
Inc.)
Third Battalion Toronto
Regiment Club
Toronto Black Watch (Inc.) 56 Wellington Street,
East
Street Arcade
290y2 Yonge Street
40 Murray Street
46 King Street, East
41 Isabella Street
285 Bloor Street, East
Toronto Disabled War
Veterans' Social Club
Toronto Labour Lyceum
Association, Limited
Twentieth Battalion Club
265 Gerrard Street, E.
346 Spadina Avenue
256 Huron Street
War Amputations of Canada 62 St. Alban's Street
(Toronto Branch)
West End Veterans' Club 722 College Street
(Operated by the Citizens'
Repatriation League Inc.)
Canadian Legion B.E.S.L.
Branch No. 18
Canadian Legion B.E.S.L.
Branch No. 4
Westmount Army & Navy
Club
Canadian Legion B.E.S.L.
Branch No. 112 (New)
Army &; Navy Veterans in
Canada, Unit No. 30
Canadian Legion B.E.S.L.
Branch No. 143
Margaret Avenue
275 Main Street, East
Kingdon Street
1014 Tecumseh Road
1880 Wyandotte Street,
West
LIQUOR AUTHORITY CONTROL BOARD
75
MUNICIPALITY
WINDSOR
WOODSTOCK
YORK EAST
YORK TOWNSHIP
NAME OF CLUB
Canadian Legion B.E.S.L.
Branch No. 94
Canadian Legion B.E.S.L.
Branch No. 12
Canadian Legion B.E.S.L.
Branch No. 222 (Edith
Cavell)
Canadian Pensioners' Associ-
ation (Windsor Branch)
Polish Army Veterans'
Association, Post No. 126
Canadian Legion B.E.S.L.
Branch No. 55
Canadian Legion B.E.S.L.
Branch No. 22
Canadian Legion B.E.S.L.
Branch Nq. 57
Canadian Legion B.E.S.L.
Branch No. 266
ADDRESS
36 Chatham Street, E.
2090 Brant Street
83 Sandwich Street, W.
493 London Street, W.
1052 Langlois Avenue
360 Dundas Street
63 Barker Avenue
351 Siiverthorne Ave.
3593 Dundas Street, W.
(M.A. Toronto 9)
76
ANNUAL REPORT OF
No. 52
MUNICIPALITY
ANGLER
ANGUS
AYLMER
BARRIE
BARRIEFIELD
BELLEVILLE
BRANTFORD
BROCKVILLE
CAMP BORDEN
MILITARY MESSES
NAME OF UNIT
\ eteraps' Guard of Canada, Internment Camp
R.C.A.F., No. 13 "X" Depot
R.C.A.F., Flight Engineers' School
Grey & Simcoe Foresters, Second (R) Battalion
Armouries
A-21 CO. & E.M.E. Training Centre
A-36 Canadian Radar Training Centre
Royal Canadian Signals, A-7 Canadian Signal Training
Centre
\'imy Barracks, MiHtary P.O. 312
C.W.A.C. No. 7 Administrative Unit
Argyll Light Infantry (Tank) First (R) Battalion
Bridge Street East
Dufferin & Haldimand Rifles of Canada, C.A., Second
(Reserve) BattaHon
Brant Avenue
R.C.A.F.. No. 4 Reserve Equipment Maintenance Unit
No. 20 Canadian Infantry (Basic) Training Centtre
Colborne Street East
Second-Tenth (R) Dragoons, C.A. & Fifty-fourth (R)
Field Battery, Royal Canadian Artillery
2ii7 Dalhousie Street
Brockville Rifles, Second (R) Battalion
East Avenue
Officers' Training Centre (E.G.) (C.A.A.)
Canadian Second Echelon (Pacific Force)
Royal Canadian Regiment, 2nd Battalion
A-22 Canadian Army Medical Corps Training Centre
A-32 Canadian Provost Corps Training Centre
Camp Borden Military Hospital
Camp Headquarters
Canadian Dental Corps (C.A.), No. 29 Company
No. 1 Canadian Armoured Corps Training Regiment
No. 2 Canadian Armoured Corps Training Regiment
No. 3 Canadian Armoured Corps Training Regiment
No. 15 Company, R.C.E.M.E. No. 15 Ordnance Depot
LIQUOR AUTHORITY CONTROL BOARD
n
MUNICIPALITY
CAMP BORDEN
CHATHAM
COBOURG
CORNWALL
CRUMLIN
DESERONTO
DUNDAS
ELORA
FINGAL
FORT ERIE
FORT WILLIAM
GALT
GANANOQUE
GRAVENHURST
NAME OF UNIT
No. 15 E.S. & W. Company, Royal Canadian Engineers
No. 44 Administrative Unit, C.W.A.C.
R.C.A.F., No. 1 Service Flying Training School
Royal Canadian Army Service Corps, No. 15 District
Company
Royal Canadian Army Service Corps Training Centre
A-19
Technical & School Wing, A-33 C.A.C.T.E.
No. 86 Military Detention Barracks
21st Armoured Car Regiment Royal Canadian
Dragoons
Lord Strathcona's Horse (Royal Canadian) 2nd Can-
adian Armoured Regiment
Kent Regiment, Second (R) Battalion
28 William Street North
Royal Canadian Artillery, 14/22nd (R) Field Battery
King Street West
Stormont, Dundas & Glengarry Highlanders, Second
(R) Battalion
Fourth Street East
London Military Hospital
R.C.A.F., No. 1 Instrument Flying School
102nd (Res.) Wentworth A. A. Battery, Royal Can-
adian Artillery
King Street
Royal Canadian x\rmy Medical Corps, 2/1 1th Field
Ambulance (Res.)
The Armoury
R.C.A.F., No. 9 S.E.H.U.
Lincoln & Welland Regiment, "C" Company Second
(R) Battalion
Main Street
Fort William Armouries' Men's Canteen (Reserve)
223 North Archibald Street
Highland Light Infantry of Canada, Second (R)
Battalion
Mill Street
R.C.A.F., No. 14 Service Flying Training School, No.
1 Relief Landing Ground
Internment Camp No. 20, V'eterans' Guard of Canada
78
ANNUAL REPORT OF
No. 52
MUNICIPALITY
GODERICH
GUELPH
HAGERSVILLE
HAMILTON
HEARST
IPPERWASH
JARVIS
KAPUSKASING
KENORA
KINGSTON
NAME OF UNIT
Middlesex & Huron Regiment, "C" Company
Newgate Street
Guelph Garrison Messes
Huskisson Street
R.C.A.F., No. 16 Service Flying Training School
R.C.O.C. Central Mechanization Depot
Argyll & Sutherland Highlanders of Canada (Princess
Louise's), Canadian Army, Second (R) Battalion
200 James Street North
Eighth (R) Field Regiment and 13tli Reserve (Ham-
ilton) A.A. Battery, R.C.A.
James Street North
H.M.C.S. "Star"
Catherine Street North
Royal Canadian Army Medical Corps, C.A., No. 5
(Reserve) Field Ambulance
200 James Street North
Royal Canadian Army Service Corps, Second (R)
Divisional Ammunition Company (C.A.)
200 James Street North
Royal Canadian Corps Signals, C.A., No. 3 Company
"A" (Reserve) Corps
200 James Street North
Royal Canadian Engineers, First (Reserve) Field
Squadron
James Street North
Royal Hamilton Light Infantry (W.R.), C.A., Second
(R) Battalion
200 James Street North
Second-Tenth (Reserve) Dragoons, C.A., "B" and
"H.Q." Squadrons
200 James Street North
S-8 Canadian Army Trades School
Kenihvorth Avenue North
No. 1 P/W Detention Barracks, Veterans' Guard of
Canada
A-29 Canadian Infantry Training Centre
R.C.A. F., No. 404 R.E.M.S.
124th Ferry Squadron Detachment
Kapuskasing Airport
Royal Canadian Artillery, 16/17 (R) Medium Battery
316 First Street North
Royal Military College
LIQUOR AUTHORITY CONTROL BOARD
79
MUNICIPALITY
KINGSTON
KITCHENER
LINDSAY
LISTOWEL
LONDON
NAME OF UNIT
Canadian Women's Army Corps, No. 103 Depot
Company
Ellerbeck and Union Streets
Combined Messes
The Armouries, Montreal Street
Headquarters Officers' Mess, AI.D. No. 3
King Street West
H.M.C.S. "Cataraqui"
47 Wellington Street
No. 3-A District Depot
Fort Frontenac
Princess of Wales Own Regiment (M.G.), (R)
Montreal Street
R.C.A.F., No. 14 Service Flying Training School
Royal Canadian Army Service Corps, No. 3 District
Company
Artillery Park
Royal Canadian Ordnance Corps, No. 3 Ordnance
Depot
Ontario and Princess Streets
No. 89 Military Detention Barracks
Canadian Women's Army Corps Training Centre
Royal Canadian Army Medical Corps, 24th Reserve
Field Ambulance
87 King Street, East
Scots Fusiliers of Canada (R)
251 King Street, West
45th-56th (R) Field Batteries, Royal Canadian Artil-
lery (Garrison Mess)
160 Kent Street, West
Royal Canadian Artillery, 100th (R) Field Battery
Main Street
Canadian Provost Corps, C.A., No. 30 Provost Coy.
Carling Heights
Headquarters, M.D. No. 1 Officers' Mess
Talbot Street Armouries
H.M.C.S. "Prevost"
433 Richmond Street
London Garrison
Dundas Street x\rmouries
Middlesex & Huron Regiment, First Battalion
347 Oxford Street
80
ANNUAL REPORT OF
No. 52
MUNICIPALITY
LONDON
LONG BRANCH
MADOC
MEAFORD
MERRICKVILLE
MILFORD BAY
MONTEITH
MOUNTAIN VIEW
MOUNT HOPE
NAPANEE
NEWMARKET
NEW SARUM
NEW TORONTO
NEYS
NIAGARA FALLS
NIAGARA-ON-
THE LAKE
<( (( ((
<< (< <<
<< ((
<< <(
(( « (<
NAME OF UNIT
No. 1 District Depot, (C.A.)
Wolseley Barracks
Talbot Street Armouries Garrison Mess
Talbot Street
Queen's Park Barracks, Headquarters, M.D. No. 1
Queen's Park (Fair Grounds), Dundas Street
S-3 Canadian Small Arms School (Eastern Canada)
C.A.
Lakeshore Road
No. 2 Infantry Training Battalion
Hastings & Prince Edward Regiment, Second (R)
Battalion, "B" Company
A. F. V. Range
Brockville Rifles, Second (R) Battalion
R.C.A.F., No. 1 Convalescent Hospital
Monteith Internment Camp, Veterans' Guard of Canada
R.C.A.F. Station
R.C.A.F., No. 1 Wireless School
Royal Canadian Artillery, 47th (R) Field Battery
Centre Street
No. 23 C.I. (B) T.C.
Sprigley Street
Central Mechanization Depot, Sub-depot R.C.O.C.,
(C.A.)
Internment Camp, Veterans Guard of Canada
Internment Camp No. 100
Lincoln & Welland Regiment, Second (R) Battalion,
"D" Company
1049 Victoria Avenue
Headquarters, No. 32 (R) Brigade Group Summer
Camp
Niagara Military Camp Headquarters
Veterans' Guard of Canada, No. 35 Company
Kent Regiment C.A. (Active)
Algonquin Regiment, C.A., Second (R) Battalion and
22nd (R) Company, Veterans' Guard of Canada
115 Oak Street, West
No. 32 Company, Canadian Provost Corps
108 First Avene West
A-38 Prisoner War Guard Training Centre
Fort Chippawa Barracks
LIQUOR AUTHORITY CONTROL BOARD
81
MUNICIPALITY
OAKVILLE
ORILLIA
OSHAWA
OTTAWA
NAME OF UNIT
R.C.A.M.C. No. 2 Women's Services' Health Centre
No. 26 Canadian Infantry (Basic Training- Centre)
Champlain Barracks
Eleventh (R) Army Tank Regiment
53 Simcoe Street North
Air Force Headquarters, Officers' Mess
158 Gloucester Street
Air Force Headquarters, W.D. Officers' Mess
Princess Alice Barracks, 152 Argyle Street
Cameron Highlanders of Ottawa, Second (R) Bn.
Drill Hall, Cartier Square
C.O.T.C, University of Ottawa Contingent
173 Waller Street
Chemical Warfare Laboratories
Sussex and John Streets
Combined Medical-Ordnance Mess
63 Sussex Street
Fourth (R) Reconnaisance Regiment (4 P.L.D.G.),
C.A.C.
557 Rideau Street
Governor General's Foot Guards, Second (R) Bn.
Drill Hall, Cartier Square
H.M.C.S. "Bytown"
78 Lisgar Street
H.M.C.S. "Carleton"
Dow's Lake
No. 3 District Depot, C.A.
Lansowne Park Military Camp
No. 7 (R) Infantry Brigade Workshop, R.C.E.M.E.
609 Bronson Avenue
No. 12 Administrative Unit, C.W.A.C.
312 Laurier Avenue, East
No. 40 Administrative Unit C.W.A.C.
Glebe Barracks, 268 First Avenue
R.C.A.F., Air Officer Commanding Maintenance
Command
Uplands
R.C.A.F., No. 17 Equipment Depot
Victoria Island
Royal Canadian Army Medical Corps, N.D.H.Q. Coy.
180 Elein Street
82
ANNUAL REPORT OF
No. 52
MUNICIPALITY
OTTAWA
PEMBROKE
PENDLETON
PENETANGUI-
SHENE
PETAWAWA
PETERBOROUGH
PICTON
NAME OF UNIT
Royal Canadian Ami}- Medical Corps, No. 23 (R)
Field Ambulance
464 Bank Street
Royal Canadan Army Service Corps, First (R) Corps
Troops
278 Sparks Street
Royal Canadian Army Service Corps, No. 9 N.D.H.Q.
Transport Company
Lansdowne Park
Royal Canadian Artillery, 33rd (R) Field Regiment
526' St. Patrick Street
Royal Canadian Artillery, 51st (R) L.A.A. Battery
Drill Hall, Cartier Square
Royal Canadian Corps Signals, Third (R) Canadian
Divisional Signals
601 Bank Street
Royal Canadian Engineers, Third (R) Field Company
601 Bank Street '^ -
Royal Canadian Ordnance Corps, Central Ordnance
Depot, C.A.
Plouffe Park
Women's Royal Canadian Naval Service
453 Laurier Avenue, East
No. 38 Administrative Unit
Argyle Barracks
Lanark & Renfrew Scottish Regiment, Second (R) Bn.
177 Victoria Street
R.C.A.F., No. 10 Elementary Flying Training School
Grey & Simcoe Foresters, "D" Company, (Reserve)
Headquarters
Alain Street
Camp Headquarters. Petawawa Military Camp
Petawawa Internment Camp
Centre Lake
Petawawa Military Hospital
Royal Canadian Ordnance Corps, No. 14 Ordnance
Depot
R.C.E.M.E., No. 14 Company
Prince of W'ales Rangers, Peterborough Regiment
Second (R) Battalion
220 Murray Street
Hastings & Prince Edward Regiment, "C" Company
Second (R) Battalion
Main Street
LIQUOR AUTHORITY CONTROL BOARD
83
MUNICIPALITY
PORT ARTHUR
PORT COLBORNE
PORT HOPE
PRESCOTT
ROCKCLIFFE
ST. CATHARINES
ST. MARY'S
ST. THOMAS
<( «
SARNIA
SAULT STE.
MARIE
SIMCOE
STRATFORD
SUDBURY
NAME OF UNIT
Headquarters, Current River Barracks
Cumberland Street
H.M.C.S. "Griffon"
125 North Algoma Street
Lake Superior Regiment, C.A., Second (R) Battalion
317 Park Street
Lincoln & Welland Regiment, "B" Company Second
(R) Battalion
Clarence Street
Midland Regiment, Second (R) Battalion
Mill Street
"C" Company Brockville Rifles, Second (R) Battalion
George Street
R.C.A.F. Station
"A" Squadron, 2/10 (Reserve) Dragoons, C.A.
Lake Street
Lincoln & Welland Regiment, Seecond (R) Battalion
Lake Street
Tenth (R) Field Battery, Royal Canadian Artillery
75 Lake Street
Perth Regiment, "D" Company, Second (R) Battalion
(Motor)
Water Street South
Elgin Regiment, Second (R) Battalion
Wilson Avenue
R.C.A.F.. Technical Training School
R.R. 4
Lambton Garrison, 11th (R) Field Company R.C.E.,
and 26th (R) 4HL A.A. Battery, R.C.A.
241 Christina Street, North
Sault Ste. Marie & Sudbury Regiment C.A., Second
(R) Battalion
118 Brock Street
No. 25 Canadian Infantry (Basic) Training Centre,
C.A.
Royal Canadian Artillery, 45th (R) Norfolk Field
Regiment
Robinson Street
Perth Regiment, Second (Reserve) Battalion (Motor)
80 Waterloo Street South
Sault Ste. Marie & Sudbury Regiment, Second (R)
Battalion, Sudbury Detachment, C.A.
19 Grey Street
84
ANNUAL REPORT OF
No. 52
MUNICIPALITY
TILLSONBURG
TORONTO
TRENTON
NAME OF UNIT
"C" Company, Oxford Rifles, (R)
Anne Street
Canadian Provost Corps, C.A., No. 31 Company
339 George Street
Canadian Women's Army Corps, Garrison Officers'
Mess
204 George Street
Chorley Park Military Hospital, R.C.A.AI.C.
North Rosedale
Fort York Armoury, Combined Units (Reserve)
Fleet Street
Headquarters, Military District No. 2
5 Dale Avenue
H.M.C.S. "York", R.C.N.V.R. Division
Automotive Building, Canadian National Exhibition
Barracks
No. 2 Armoured Brigade Workshop, R.C.E.M.E.
61 Albert Street — Top Floor
No. 2 District Depot, C.A. (R)
Exhibition Barracks, Exhibition Grounds
No. 2 Military Research Centre
159 Bay Street
No. 49 Administrative Unit, C.W.A.C.
204 St. George Street
No. 102 Depot Company, C.W.A.C.
Long Branch
R.C.A.F., No. 1 Composite Training School
1107 Avenue Road
R.C.A.F., No. 3 Convalescent Hospital
"Divadale," Sutherland Drive, Leaside
R.C.A.F., No. 4 Release Centre
Coliseum Building, Exhibition Grounds
R.C.A.F., No. 12 Aeronautical Inspection District
2 Cawthra Square
Royal Canadian Corps of Signals, C.A. (Reserve)
185 Spadina Avenue
University Avenue Armouries, Men's Canteen (R)
University Avenue Armouries
Hastings & Prince Edward Regiment (R) Second
Battalion ; Support Company ; and Battalion Head-
quarters
Quinte Street
R.C.A.F., No. 6 Repair Depot
LIQUOR AUTHORITY CONTROL BOARD
85
MUNICIPALITY
TRKNTON
WALKERTON
WELLAND
WINDSOR
WOODSTOCK
NORTH YORK
TOWNSHIP
NAME OF UNIT
R.C.A.F. Station
97th (R) Field Battery and 1st (R) Field Regiment,
Royal Canadian Artillery
Jane Street
Lincoln & Welland Regiment, "A" Company Second
(R) Battalion
Aqueduct Street
Essex Scottish Regiment, Second (R) Battalion
353 Cartier Place
H.M.C.S. "Hunter"
960 Ouellette Avenue
No. 1 (R) Infantry Bde. Workshop, R.C.E.M.E.
Jackson Park Armoury
Thirtieth (Reserve) Reconnaissance Regiment (Essex)
Regiment), C.A.C.
357 Cartier Place
30th Company Canadian Provost Corps (Windsor
Detachment)
Oxford Rifles, Second (Reserve) Battalion
Graham Street
S-5 Canadian Driving & Maintenance School (A.F.)
R.C.x\.F., No. 1 Equipment Depot
North York Township (Weston P.O.)
R.C.A.F.— War Staff College
Wilson Avenue, Armour Heights
ANNUAL REPORT OF
No. 52
STEAMSHIPS
MUNICIPALITY NAME OF STEAMER
MIDLAND
SARNIA
ST. THOMAS
TORONTO
"S.S. North American'
"S.S. Noronic"
"S.S. Pelee"
"S.S. Assiniboia"
"S.S. Keewatin"
"S.S. Kingston"
"S.S. Manitoba"
OWNER
Chicago, Duluth & Georgian
Bay Transit Company
Canada Steamship Lines Limited
Pelee Island Shipping Company
Canadian Pacific Railway
Company
Canadian Pacific Railway
Company
Room 366, Union Station
Canada Steamship Lines Limited
Queen's Quay, Foot of Bay Street
Canadian Pacific Railway
Company
Room 366, Union Station
LIQUOR AUTHORITY CONTROL BOARD
87
SCHEDULE No. II
Authorities Not Renewed as of March 31st, 1946
MUNICIPALITY
AMULREE
BLYTH
BRUSSELS
DUBLIN
DUNKELD
GADSHILL
GODERICH
HENSALL
LISTOWEL
MILVERTON
MITCHELL
SEAFORTH
SHAKESPEARE
ST. MARY'S
NAME OF HOTEL
Royal Hotel
R.R. 1, Stratford
Commercial Hotel
Queen's Hotel
Huron Hotel
Dunkeld Hotel
R.R. 4, Walkerton
Exchange Hotel
R.R. 1
Bedford Hotel
NAME OF OWNER
Pedlar, Philip S.
Clare, G. W.
Kirby, Mrs. Maude
Mulligan, Paul
Eigenbrod, Mrs. C. P.
Gerhardt, Geo. C.
Knechtel, Mrs. E. M. and
Curry, Mrs. A. E.
British Exchange Hotel Pellow, Mrs. Margaret G.
Royal Hotel The Estate of Margaret
Kelly and Miss Mary
Loretto Kelly,
Administratrix
New Commercial Hotel Tudor, Stanley
Fischer, Jos. R.
Royal Hotel
Wallace Street
York Hotel
Main Street
Winston Hotel
Collison House
Hicks House
Royal Hotel
Huron Street
Commercial Hotel
Dick House
Queen's Hotel
Shakespeare Hotel
Union Hotel
Garnet House
Church Street
Fischer, J. R.
McNair, A. D.
Dungey, Wm. John
Taylor, Mrs. Mary S.
Cox, Jos. J.
Dungey, Mrs. Fanny
Dick Brothers
Lewis, Harry and Corby,
Amos
Henerson, David J.
McKone, A. R. and Mrs.
Isabel
Oddy, Miss Fanny
88
ANNUAL REPORT OF
No. 52
MUNICIPALITY
ST. MARY'S
<( «
ZURICH
NAME OF HOTEL
Royal Edward Hotel
7 Queen Street
Windsor Hotel
Dominion Hotel
NAME OF OWNER
Pinney, Mrs. Thos. G.
Graham, Mrs. O. M.
[ohnston, Ross H.
ERINDALE
LONG BRANCH
PORT CREDIT
CLUBS
Credit \"alley Golf Club
Toronto Golf Club
Canadian Legion B.E.S.L., Branch No. 82
Elizabeth Street
Lakeview Golf Club Limited
Dixie Road
Mississauga Golf & Country Club Limited
Mississaugra Road
NOTE: With the exception of the Dunkeld Hotel, Dunkeld, the foregoing are situated
in areas which come under the provisions of the Canada Temperance Act.
LIQUOR AUTHORITY CONTROL BOARD
89
SCHEDULE No. Ill
Hotel Authorities Transferred — (233)
April 1st, 1945 to March 31st, 1946
Municipality
ACTON
ALVINSTON
AMULREE
ARTHUR
AYR
AYTON
BALA
BARRIE
BELLEVILLE
BELLE RIVER
BIEZARD
VALLEY
BLIND RIVER
BLYTH
BLIND RIVER
BOURGET
BRIGHT
BRIDGEPORT
BRANTFORD
Transferred from
Holmes, H. F.
Name of Hotel
Dominion Hotel
Main Street
Grand Central Hotel Williams, Mrs. V.
Litt, G. S.
Runge, E. C.
Royal Hotel
R.R. 1, Stratford
Commercial Hotel
George Street
Queen's Hotel
Swan Street
Kunda, J.
Transferred to
Royston, Mrs. M. A.
Simpson, S. S. and
Munro, J. D.
Pedlar, P. S.
West, W. L. and
Bolen, W. R.
Targonski, S.
Commercial Hotel
Bala Bay Lodge
New Windsor Hotel Carry, M.
Doersam, Estate of Doersam, Peter F.
J. P.
Davey, Chas. and
Sandler, N. L.
Clarkson Hotel
130 Dunlop Street
Clifton Hotel
257 Bradford Street
Simcoe Hotel
Five Points
Wellington Hotel
Canadian Hotel
2>1 Dundas Street
Doctor's Hotel
2Z1 Station Street
Alexander Beach
Grove Hotel
R.R. 1, Maidstone
Township
Blezard Hotel
Harmonic Hotel
Woodward Avenue
Commercial Hotel
Riverside Hotel
Royal Hotel
Arlington Hotel
Lancaster Hotel
Strand Hotel
Lang, Harry
Kerrigan, S. C. and
Mrs. C. L.
Cohen, Max
Kennedy, Mrs. F.
Haggis, P.
Briens, A. J.
Carriere, A. and
Rheaume, E.
Cayen, L. B.
Seguin, A.
Poole, K., St. G.
Laforge, O.
Paul, D.
Schade, A. L.
Dillon, Mrs. D. O.
and Querin, F.
Young, G. M.
Davey, Chas.
Frew, Thomas and
Matthew
White, F. and
McElroy, J. E.
Kerrigan, S. C.
Cohen, Max and
Dollinger, S.
Wellington Hotel
(Barrie) Limited
Canadian Hotel
(Belleville) Ltd.
Briens, A. J. and
Mrs. Cecilia
Carriere, A.
Dennie, Glenn J.
Laforge, O.
Clare, G. W.
Gauthier, A.
Gagne, R.
Moss, C. H.
Querin, F.
Craise, R. A.
90
ANNUAL REPORT OF
No. 52
Municipality
BRONTE
BROCKVILLE
BURLINGTON
CACHE BAY
CALEDONIA
CHATHAM
CHATSWORTH
CHESTERVILLE
CHUTE A
BLONDEAU
CLARENCE
CREEK
COCHRANE
COBALT
CORNWALL
Name of Hotel
Transferred from Transferred to
Pig & Whistle Inn Brown, Mrs. L. M. Mullaney J E and
^•R- 1 • ■ - V Mrs. O. S.
(Garbutt's. Hotel , Brockville Trust & Ashley, Mrs. Jessie
19 King Street, East Savings Company
CRYSTAL BEACH
CRYSIER
DESERONTO
DRESDEN
DRYDEN
Coronation Hotel
25 Brant Street
Cache Bay Hotel
Railway Street
Exchange Hotel
Argyle Street
Union Hotel
Argyle Street
Aberdeen Hotel
1 Grand Avenue, East
Campbell Hotel
Dominion Hotel
Central Hotel
Union Hotel
Anderson House
179 Fourth Avenue
Stevens House
223 Railway Street
Eraser House
24 Prospect Avenue
King George Hotel
3 Second Street, East
Lloyd George (New
W'indsor)
15 Pitt Street
New Windsor
(Lloyd George)
15 Pitt Street
Markcity Hotel
7 Cambridge St., E.
Martinell Hotel
Markcity Hotel
7 Cambridge St., E.
Commercial Hotel
Paterson, P. W.
Gauthier, A.
O'Rourke, J. M.
Leonard, J. J.
Kozak, M.
Arcand, Jos.
Thacker, A.
O'Meara, D.
Bechard, Miss L. M. Martin, Jas. C.
Galbraith, M. E. and Crawford, J. F. and
R. W. Airs. M.
Flynn, Thos.
Berlinguette, W.
Lavigne, R.
Marchand, D.
Lefebre, A. A.
Martineau, D.
Gagnon, A.
Thiboutot, F. X.
Stevens, Estate of Stevens, Mrs.
Arthur Francis E.
Assaf, A.
Kalil, J. M.
Abraham, E. A. and R.
Thomas and Nash Ltd.
Eringloe, C. A. and Lloyd George Hotel
Gallinger, L. D. Company
Arlington Hotel
Main Street
Morgan Hotel
Main Street
Dryden Hotel
74 Queen Street
LaPlante, Mrs. J.
Markcity, M.
Strauch, M.
Balwar, W. and
Melnychuk, M.
and Onyschuk, P.
Caron, Henri
Hall, J. E.
Bringloe, C. A. and
Gallinger, L. D.
Carr, H. R. and
Weese, D. J.
Balwar, W. and
Melynchuk, M.
and Onyschuk, P.
O'Brien, Airs. M. E.
Berezowsky, W.
Brisebois, E. and
Martin, D. E.
Alarck, Stanley R.
Weese, D. J.
Self, Estate of Self, W. and Kelly,
C. O. and W. Self Airs. C. E.
LIQUOR AUTHORITY CONTROL BOARD
91
Municipality
DRYDEN
EARLTON
EGANVILLE
ELK LAKE
ELMWOOD
ELORA
ENGLEHART
ERIN
ERIEAU
ESSEX
FERRIS WEST
TOWNSHIP
FIELD
FORT ERIE
<i <<
FOLEYET
FORT FRANCES
FORT WILLIAM
<< i<
GALT
GANANOQUE
Name of Hotel
Dryden Hotel
74 Queen Street
Cecil Hotel
Eganville House
Transferred from
Kelly, Mrs. C. and
Self, W. E.
Kerr, R. R.
Sammon, Estate of
T. A.
King Edward Hotel Kell, Mrs. A.
Stonehouse Hotel
Fourth Street
Queen's Hotel
Iroquois Hotel
Metcalfe Street
Eldon House
Busholme Inn
Lakeview Hotel
Robinson, E. R.
Hallal, C.
Sachs, R. C.
Cruickshank, H. W.
Hipkins, E. A.
Kauzen, W.
Grand Central Hotel Bolahan, Geo. N. C.
Talbot Street
Lakeview Inn
Lakeview Inn
Field Hotel
National Hotel
Anglo-American
Hotel
280 Niagara Blvd.
Erie Lane Hotel
33 Princess Street
Howard (Ohio
Hotel)
33 Niagara Blvd.
New King Edward
Hotel
271 Niagara Blvd.
Royal Hotel
1 Niagara Blvd.
Commercial Hotel
Prince Albert Hotel
White Pine Inn
800 Scott Street
Adanac Hotel
West Hotel
Overland Hotel
18 Concession Street
Billington, J. W.
Leach, E. A.
Trottier, O.
Gervais, N.
Neichenbauer, A.,
A., C, and E.
Hunt, Mrs. A.
Rung, Mrs. M.
Velichkovich, T.
Davidson, Mrs. K.
Camirand, J.
Eggen, O.
Eggen, A. L.
Crites, D. L.
Black, A. J. and Sons
White, J. A.
Transferred to
Self, W. E.
Paiement, Roger
Sammon, Miss M.
Montpetit, E. and
Sauve, L.
Rusich, Nick and
Mrs. M.
Sainsbury, O.
Wood, J. A.
Morris, J.
Fullerton, A. M.
Yandrash, I. and
Vucic, Vic
Crowley, L. L.
Leach, E. A.
Leach, Mrs. Margaret
Sauve, Leo O. and
Phillipe
Sauve, Leo O. and
Phillipe
Neichenbauer, A., A.,
C. and A. G. Crawford
Masich, Frank, J. and
Nickolas E.
Zajac, A.
Sima, Andrew,
Andrew Jr. and
Stanko, M.
Uster, Mrs. V.
Robert, J. and
Denommee, M.
Griffiths, Mrs. M.
Crawford, A. G.
Crites, Estate of D. L.
Black, A. J.
White, Mrs. F. E.
International Hotel Martin, Mrs. A. I. McGregor, Mrs. A. I.
King and Main Streets
92
ANNUAL REPORT OF
No. 52
Municipality
GLENCOE
GRIMSBY
HAMILTON
Name of Hotel
McKellar House
Transferred from
Loosemore, F. G.
Village Inn Shafer, R. V. and
57 Main Street, West Mrs. M. K.
Bayview Hotel Wilson, J. H. and
81 Stuart Street, West Bach. H. C.
Carleton Hotel Berryman, F. J. and Berryman, F. J. and
659 King Street, East Dailey, J. L. F.
Transferred to
Loosemore, Airs. E.
Hannah, G. A.
Senson, Paul
Dog and Gun Hotel Moore, Chas. C.
295 York Street
Wintonek, D. and
Wicinski, J.
Iroquois Hotel Fee, Estate of C. A. Hultay, Wm.
94 King Street, West
Picton Hotel Pavlovich, George
183 Picton Street, East
Strand Hotel King, Lewis
262 Dundurn Street, S.
Sherman Hotel Dimarchi, Mrs. U.
421 Sherman Ave., N. and Ghilardi, A.
Turbinia Hotel Wetherup, B. R.
345 James Street, N.
Waverley Hotel Hutchinson, W.
632 Barton Street, E.
HAWK JUNCTION Hawk Junction Hotel Atkinson, Mrs. C.
Hawk Junction Hotel Breton, A.
HAWKESBURY
HANMER
HASTINGS
HEARST
HEPWORTH
HESPELER
HUNTSVILLE
IGNACE
Bridge Inn
Royal Hotel
24 Main Street, West
Joffre Hotel
Royal Hotel
Windsor Hotel
Royal Hotel
Hespeler Hotel
Dominion Hotel
Ignace Hotel
Lavigneur, A.
Hawkesbury Bldg.
Company Limited
Desilets, J. W.
Condon, John Sr.
and J. M. Jr.
Bourdon, F. C.
KIRKLAND LAKE Capitol Hotel
60 Second Street
Grugos, George
Finch, H. T. and
Shadney, P.
Stecyk, Paul
Bencekovich, P. and
Holetic, M.
Kisil, W.
Briton, A.
Flanagan, W. G. O.
and Mrs. L. O.
Montpetit, O.
Martineau, O.
Cayen, L. B.
Jones, E. W.
Dupont, R. and
Chabot, L.
Bonser, R. A.
Jaras, M.
Stirling, Mrs. L.
Smilsky, Wm.
No change
KITCHENER
KENORA
LA SALLE
LANCASTER
Union Hotel
9 Main Street
Mayfair Hotel
11 Young Street
Dalmore Hotel
Main Street
Chateau LaSalle
Front Road
Commercial Hotel
Sadler, W. R. and
Parrott, A. E.
Cornell, J. S.
Simmons, B. C.
Spetch, Mrs. E. A.
(Transfer Shares)
New Townsite
Hotel Company
Pavlakovich, F.
Lipi^ert, Estate of E. Mayfair Hotel Limited
Sauerbrei, John W.
Pavlakovich, F. and
Mihelcic, J.
Lee, D. Y. T.
Leduc, J. L.
Sauerbrei, Estate of
John W.
Lavin, John H.
Leigh, M.
LIQUOR AUTHORITY CONTROL BOARD
93
Municipality
LAVIGNE
LEAMINGTON
Name of Hotel
Lavigne Hotel
Auto Stop Inn
LINDSAY
LONDON
LUCAN
L'ORIGINAL
MALDEN
TOWNSHIP
MARTIN RIVER
MARATHON
MATACHEWAN
MAYNOOTH
MILTON
MINE CENTRE
MERRICKVILLE
NAPANEE
NIAGARA FALLS
Transferred from
Pilon, V. G.
Vlasic, I. and
Vukmanich, C.
International Hotel Stickles, L. A.
35 Erie Street, South
International Hotel Shamess, H. A.
35 Erie Street, South
Grand Hotel Everson, A. H.
171 Kent Street, West
New Royal Hotel
2 Kent Street
St. Regis Hotel
625 Dundas Street
York Hotel
216 York Street
Central Hotel
Main Street
Riverview Inn
Meadows Hotel
Fox, C. J.
Cochrane, B. H.
Keating, J. J.
McFalls, W. J.
Millette, Mrs. H.
Marontate,
Mrs. B. L.
Reaume Park Hotel Reaume, E.
(Lake Shore)
R.R. 2, Amherstburg
NIAGARA-ON-
THE-LAKE
Beaverland Hotel
Everest Hotel
Park Hotel
Arlington Hotel
Kennedy Hotel
Main Street
Milton Inn
Main Street
Mine Centre Hotel
Louis Hotel
St. Lawrence Street
Paisley Hotel
John Street
Clifton Hotel
955 Clifton Hill
Metropole Hotel
Bridge Street
Prospect Hotel
1951 Main Street
Prince of Wales
Hotel
Picton Street
McPhail, C. W.
Marathon Paper
Mills of Canada
Limited
Bedard, R.
Smith, Estate of
Mrs. A.
Kennedy, Chas.
Mitchell, J. R.
Law, Mrs. M.
Louis, Geo. R.
Fitzpatrick, John H.
Corcoran, J. A.
Metro Hotel
Company Limited
Ward, Estate of
J. E.
Bilson, J. and
Holetic, M.
Transferred to
Martin, J. R.
Vlasic, J.
Shamess, H. A.
Shames, Estate of
H. A.
Bland, Sam
Adam, J. S. and
Fralick, C. A.
Jacques, H. A.
Assaf, A.
Parker, J. S.
Dubois, F.
Meadows Hotel Ltd.
Kilgallin, T. V. and
Ouellette, W. J.
Handley, A. J. J.
Harbour Heights Ltd.
Dalpe, J. A.
Painter, W. B.
Kennedy, Mrs. Rachel
Armstrong, F. W.
Law, Estate of Mrs.
M.
Crawford, Geo. R.
Tyson, Edward and
Mrs. Jessie A.
Benson, W. P. and
Gillespie, A. C.
Cohen, Max and
Dawe William A.
Prospect House Ltd.
Bilson, J.
94
ANNUAL REPORT OF
No. 52
Municipality
NIAGARA-ON-
THE-LAKE
« «
NEW HAMBURG
it ((
NEW LISKEARD
NEWTONBROOK
NORTHBROOK
Name of Hotel
Prince of Wales
Hotel
' Picton Street
Riverside Hotel
Commercial Hotel
Imperial Hotel
Grand Union Hotel
Whitewood Avenue
Algonquin Hotel
5797 Yonge Street
Transferred from
Bilson, J.
Sherlock, A. E.
Purvis, G.
Rumig, J. A.
Slee, C. A.
Zayats, A. and
Dorosh, N.
Northbrook Hotel Donnelly, A. J.
Continental Hotel
NORTH BAY
OTTAWA
PARIS
PELEE ISLAND Pelee Hotel
Pelee Hotel
Victoria Hotel
34 Murray Street
New Royal Hotel
11 Mechanic Street
PEMBROKE
PENETANG
PETERBORO
PICTON
ti
PORT COLBORNE
PORT
DALHOUSIE
PORT ELGIN
PORT STANLEY
PORT HOPE
PRESCOTT
PRESTON
Mackay House
185 Pembroke St., E.
Canada House
85 Main Street
Empress Hotel
131 Charlotte Street
Globe Hotel
Main Street
Globe Hotel
Main Street
Colonial Hotel
124 West Street
Port Hotel
6 Front Street
Arlington Hotel
Queen's Hotel
Orion (Plaza) Hotel
William Street
Why Not Hotel
Ontario Hoteel
30 Ontario Street
Ontario Hotel
30 Ontario Street
Daniels Hotel
Sulphur Springs
Hotel
240 King Street
Transferred to
Sadowrey, J. and
Prysko, J. H.
Stevens, B.
Paul, Stanley
Rumig, C. J.
Evans, L. S.
Zayats, A. and
Zaraska, W.
Courneya, U. C. and
E.J.
Kerrigan, S. C.
Charos, P. G.
Hynes, J. W.
Holtze, L. C.
Kerrigan, S. C. and
Mrs. C. L.
Macey, S. G.
Brownlee, R. T.
Holtze, L. C. and
Mrs. M.
Holtze, L. C. and
J. L.
Leigh, M.
Cloutier, Mrs. M.
Graham, C. G. and
Graham, G. K.
Kerrigan, S. C. and
Mrs. C. L.
Kerrigan, S. C.
Woods, J. A.
Maxwell, W. H.
Baker, Mildred
McPherson, R. and
AIcGee, A. E.
Bartholomew, Jas. C. Kohn, S.
Boug, Mrs. Doris Weir, Mrs. Doris Boug
Holtze, L. C. and
Mrs. M.
Costin, E. R.
Allen, J. D. and
Renton, A. E.
Empress Hotel
(Peterboro) Ltd.
Kerrigan, S. C.
Cox, J. J.
Milligan, H. F.
Chaikowski, D. C. and
Kmit, Y.
McGrath, E.
McPherson, R.
Lavin, J. H. and
McElroy, J.
Powell, B. H. and
Tweedle, E. H.
Doyle, J. P.
Jaras, M. and
Markus, J.
Powell, B. H. and
Tweedle, E. H.
Powell, B. H.
Korsa, Nicholas
Markus, J.
LIQUOR AUTHORITY CONTROL BOARD
95
Municipality
RAINY RIVER
RED LAKE
RIVER CANARD
ROCKLAND
ROUGE HILLS
ROYAL
MUSKOKA
RUSSELL
SALTFLEET
SAULT STE.
MARIE
SHAKESPEARE
SCHUMACHER
SIMCOE
SMOOTH ROCK
FALLS
SOUTHAMPTON
SPANISH
STATION
STAMFORD
STRATFORD
STONEY CREEK
ST. EUGENE
ST. ISADORE DE
PRESCOTT
ST. JOACHIM
Name of Hotel
Transferred from
Rainy River Hotel
McCuaig Hotel
Palm Beach Villa
Rockland Hotel
King George Hotel
143 Laurier Street
Glen Eagles Manor
Royal Muskoka
(Transfer Shares)
Russell House
Derby Inn
Desorcy, Mrs. K.
Transferred to
Popowich, Wm.
McCuaig Hotel McCuaig (Red Lake)
Company Limited Hotel Co. Ltd.
Desjardin, Albert
Menard, J.
Laframboise, J.
Desjardin, Mrs. A.
Viau, A.
Gamelin, A.
Glen Eagles Manor Dnieper, Peter
Hotel Limited
Muskoka Lakes no change
Navigation Co.
Brunette, A.
Derbyshire, J. R.
Derby Inn
Algonquin Hotel
864 Queen Street, E.
Royal Hotel
2 Queen Street, East
Union Hotel
Box 195
Recreational Hotel
32 First Avenue
Melbourne Hotel
39 Robinson Street
Norfolk Hotel
41 Norfolk Street
Elite Hotel
Lowry
(Southampton Hotel)
Huron Hotel
Montrose Hotel
R.R. 2
Avon Hotel
388 Downie Street
Dominion Hotel
Da-Nite Hotel
Windsor Hotel
Central Hotel
Sculland, F. M.
Neichenbauer, E. and
A. and Varyu, N.
Neichenbauer, E. Neichenbauer, E. and
and A. and Varyu, Varyu, N.
N.
Sisson, Mrs. H. Paterson, P. W.
Keenan, Mrs. C. E. Keenan, B. P.
Burgess, Mrs. A.
McGuire, M. P.
McKone, A. and
Mrs. I.
Crocock, H. J.
Lockard, W.
Hudson, T.
Lowry, Mrs. S. A.
Beauchamp, J.
Lett, W.
Larche, N.
Challenger, D. R. and
C. E.
Dumsha, J.
Philipchuk, Mrs. E.
Smith, L. A.
Ferris, M. E.
Snell, F. A. and
Antonia, J.
Kerrigan, S. C. and Kerrigan, S. C.
Mrs. C. L.
Sharpe, A. J.
Mather, A. P.
Landriault, R.
Martin, C.
Wilton, R.
Geekie, Wm.
Landriault, A.
Lalonde, C.
St. Joachim Hotel Guilbeault, Estate Rockburn, Harvey
of S.
STURGEON
FALLS
Windsor Hotel
Chaput, Mrs. H. C. Chaput, Estate of
Mrs. H.
96
ANNUAL REPORT OF
No. 52
Municipality
STONEY CREEK
SUDBURY
TECUMSEH
THESSALON
THOROLD
TILLSONBURG
TIMMINS
TORONTO
Name of Hotel
Pines Hotel
145 Lake Avenue
Nickel Range Hotel
10 Elm Street, West
Paris Hotel
24 Borgia Street
Renaud Inn
103 Tecumseh Road
Sinton Hotel
Main Street
Summitt House
Front Street
Thorold Inn
54 Front Street
Imperial Hotel
30 Broadway Street
Grand Hotel
56 Third Avenue
St. Charles Hotel
16 Cedar Street
Timmins Hotel
56 Fourth Street
Welcome Hotel
7 Spruce Street, S.
Alexandra Hotel
102 Queen Street, W.
Broadview Hotel
106 Broadview Ave.
Breadalbane Hotel
2-8. Breadalbane St.
Clyde (Albany)
Hotel
158 King Street, East
Transferred from
Galbraith, F. J.
Nickel Range
Hotel Company
McVety, H. H. and
Mrs. I.
Renaud, E. J.
AlcCartney, Mrs. J.
Stecyk, P.
Ellison, H.
Bringloe, A. E. and
W. A.
Alason, P. A.
Spiala, G. and
Irmie V.
Jamsa, Estate of O.
Denesavitch, Estate
of J.
Humeniuk, J. and
Kokor, P.
Crawford, S. B.
McLaughlin, F. and
Corson, R. R.
Rowalchuk, Wm.
Derby Hotel Salonen, C. and
393 King Street, East Stuart, G. T.
Dennis Hotel
238 Broadview Ave.
Edgewater Hotel
10 Roncesvalles Ave.
Good Hotel
572 Bay Street
Gladstone Hotel
1208 Queen Street, W.
Isabella Hotel
556 Sherbourne Street
Jarvis Hotel
103 Jarvis Street
Dennis, B.
Hammer, F.
Transferred to
Phoenix, W. C. and
Mrs. W. C.
Nickel Range Hotel
(Sudbury) Ltd.
Trottier, O. and
Airs. Eva
Fabra, C. and
Dudley, L.
Sinton, S. M.
Cuiniak, W. and
Bruch, M.
Kekic, Peter
Bringloe, Mrs. A. E.
Cimetta, N. and
Mrs. M.
Vaillancourt, L. and R.
Jamsa, Mrs. A.
Denesavitch, Mrs. O.
and Lavich, L.
Humeniuk, J.
Dunlop, Alfred E.
Breadalbane Hotel
Limited
Diakin, John
Derby Hotel
(Toronto) Ltd.
Melnick, J.
Onazuk, M. and
Dimitroff C. and
A. Harris
Good, Mrs. P.
Gladstone Hotel Ltd.
Good, A.
Ryan, F. M.
Heisey, Mrs. A.
Flanigan, Mrs. V. M. Onrot, Airs. Belle
Heisey, Estate of K.
B.
Lansdowne Hotel Ryan, Airs. J. K.
1744 Dundas St., W.
Lansdowne
Enterprises Ltd.
LIQUOR AUTHORITY CONTROL BOARD
97
Municipality
TORONTO
Name of Hotel
VAN WAGNER'S
BEACH
WELLESLEY
WATERDOWN
WARDSVILLE
WARREN
WASAGA BEACH
WELLAND
WELLESLEY
WIARTON
WINDSOR
Transferred from
Ticonic Corporation
Oxford Hotel
(Transfer Shares) Limited
930 King Street, West
Piccadilly Hotel Piccadilly Hotel
(Transfer Shares) Company Limited
Riviera Hotel
197 King Street, East
Tusco Hotel
235 Jarvis Street
Victoria Hotel
56 Yonge Street
Victory Hotel
418 Bay Street
Edgewater Hotel
R.R. 5, Hamilton
Royal Hotel
Queen and William
Streets
Kirk House
Main and Dundas
Streets
Wilson (Wardsville
Inn)
Main Street
Globe Hotel
Nottawa Inn
Commercial Hotel
62 King Street
Reeta Hotel
90 Main Street, East
Welland Hotel
3 Niagara Street
Queen's Hotel
Pacific Hotel
Berford Street
Arlington Hotel
891 Erie Street
Bellvue Hotel
1271 Sandwich St., E.
Deakin, J.
Tusco Hotel
Limited
Elliott, M. J.
Assaf, W. E.
Corey, M. L.
Karwaski, J.
Kirk, J. L.
Wood, W. J.
Sauve, D.
Hacker, C. F.
Anderson, C. W.
F. J. Cooper
Price, F. H.
Miller, C. J.
Lymburner, A.
Arlington Hotel
Limited
Raletich, I. and
Opacich, S.
B.
YORK MILLS
Bridge Avenue Hotel Lond, M. J.
1886 London St., W.
Dixie Hotel Nikilchuk, Olga
1080 Erie Street, East and Pete
Essex House Woolcott, Mrs. A.
317 Sandwich St., East
Howard Hotel Ouellette, L.
1534 Howard Avenue
Palace Hotel Pucai, V.
939 Drouillard Road
Royal Hotel Bell, Mrs. M. and
4877 Wyandotte St., E. Gilbee, Mrs. I.
Rex Hotel Bush, Mrs. E. M.
1116 Drouillard Road
Southwood Hotel Bielich, M. and
1353 Wellington Street Manich, G.
New Jolly Miller McEvoy, F. M.
3885 Yonge Street
Transferred to
no change
no change
Humeniuk, T. and
Syko, Mrs. M.
Tusco Hotel Limited
(Share Transfer)
Victoria Hotel
(Toronto) Ltd.
Assaf, W. E. and
Mrs. Eva
Marks, C.
Pirce, Louis
Kirk, J. L. and Mrs.
A. I. and Miss
M. A.
Muir, T. A.
Boucher, H. F.
Nottawa Inn Limited
Sher, D. and S.
Saltzman
Hotel Reeta Limited
Kunda, John and Stella
Logel, J. S.
Walker, A. G. and
R. A.
Bilson, John and Mary
Mandich, G. and
Opacich, B.
Vida, M.
Schiller, Mrs. E.
Kovarbacih, P. and
Todorovich, G.
Foley, Mrs. Mary
Moskalyk, S. and
Mrs. jean
Radonich, M. and
Tarailo, D.
Lysy, M. and
Nikon, N.
Bielich. M.
New Jolly Miller
Hotel Limited
98
ANNUAL REPORT OF
No. 52
SCHEDULE No. IV
Authorities Suspended — (59)
April 1st, 1945 to March 31st, 1946
Municipality
Name of Hotel
Name of Owner
from
Period
to
CACHE BAY
Travellers Hotel
St. George, L.
Mar. 18
Mar. 31
CHATHAM
Merrill House
Harris, Louis
Sept. 15
Sept. 25
CHESTERVILLE
Dominion Hotel
Lefebvre, A. A.
Dec. 19
Jan. 4
CLARENCE
CREEK
Union Hotel
Lavigne, R.
Oct. 2
Oct. 18
COCHRANE
London Hotel
Chamandy, Mrs.
Oct. 2
Nov. 3
COURTRIGHT
Bedard Hotel
Bedard, Mrs. J.
Feb. 16
Mar. 2
CORNWALL
Central Hotel
Miller, J.
Apr. 19
May 2
«
St. Lawrence Hotel
Mercier, A.
Apr. 11
May 28
DRESDEN
Morgan Hotel
Weese, D. J.
Feb. 16
Mar. 8
DUNNVILLE
New Royal
Hensgens, J.
Jan. 23
Feb. 22
FORT ERIE
Ohio Hotel
Zaiac, A.
Jan. 16
Feb. 1
" "
Merview Hotel
Compton, M.
Mar. 30
Mar
(still in force
. 31, 1946)
FORT WILLIAM
Alexandra Hotel
Zaroski, W.
Feb. 7
Mar,
(still in force
. 31, 1946)
HAMILTON
Britannia Hotel
Watson, Mrs. J. G.
Jan. 22
Feb. 1
"
Homeside Hotel
Taylor, Rosart O.
Jan. 4
Feb. 7
«
Waverley Hotel
Hutchinson, W.
Nov. 14
Nov. 26
KINGSTON
Windsor Hotel
Gilmour, Mrs.
Mar. 30
Mar.
(still in force
31, 1946)
Royal Hotel
Kingston Hotel
Company Ltd.
Alar. 23
Mar. 30 ■
LINDSAY
Grand Hotel
Bland, Sam
Oct. 24
Nov. 2
L'ORIGINAL
Riverview Inn
Dubois, F.
Dec. 21
Jan. 5
MARYSVILLE
Marysville Hotel
Fahey, J. V.
Aug. 16
Aug. 22
NIAGARA FALLS
Venetian
Briand, J.
J^n. 16
Jan. 31
NORTHBROOK
Northbrook Hotel
Donnelly, A. J.
Dec. 6
Dec. 21
OTTAWA
Bytown Inn
Brigham, T. G.
Dec. 14
(still in force
King Edward Hotel Terminal Hotels
Mar. 31, 1946)
Mar. 22 (still in force
Mar. 31, 1946)
PARIS
PORT DOVER
PORT STANLEY
Pacific Hotel
Victoria Hotel
New Royal Hotel
Erie Beach Hotel
Whv Not Hotel
Dore, L.
Charos, P. G.
Dec. 21
Dec. 29
Mar. 15 (still in force
Mar. 31, 1946)
Brownlee, R. T. Nov. 14 Dec. 8
Brugos and Almassy July 23 Aug. 10
Weir, Airs. Doris Feb. "16 Alar. 2
LIQUOR AUTHORITY CONTROL BOARD
99
Municipality
Name of Hotel
Name of Owner
Period
from to
RIVERSIDE
Edgewater Hotel
Thomas' Inn Ltd.
July 9
July 25
RUSSELL
Russell House
Sculland, F. M.
Dec. 4
Dec. 19
SARNIA
Windsor Hotel
Taylor, C. L.
Feb. 16
Mar. 8
SAULT STE.
MARIE
Algoma Hotel
Cohen, W. M. N.
Jan. 5 (still in force
Alar. 31, 1946)
SIMCOE
Governor Simcoe
Hotel
Leask, F. A.
Feb. 16
Mar. 2
"
Norfolk Hotel
Dumsha, J.
Jan. 29
Feb. 9
SPANISH
STATION
Huron Hotel
Ferris, M. E.
Jan. 29
Mar. 1
ST. CATHARINES
Ontario Hotel
Bagdasarian, M.
Jan. 16
Feb. 1
ST. THOMAS
Queen's Hotel
Deratnay, M.
Feb. 7
Mar. 7
SUTTON WEST
Sutton Inn
Miller, E.
Dec. 4
Dec. 18
TEMAGAMI
Goddard's Hotel
Goddard, E. F.
Mar. 28
Mar
(still in force
. 31, 1946
TORONTO
Alexandra Hotel
Humeniuk and Kobor
Apr. 9
Apr. 19
Alexandra Hotel
Humeniuk, J.
Mar. 19
Mar
(still in force
31, 1946)
Beresford Hotel
Glass and Waxman
May 16
May 18
Carls-Rite
Peninsula Co.
Sept. 15
Oct. 4
Carls-Rite
Peninsula Co.
Feb. 15
Mar
(still in force
31, 1946)
Commodore Hotel
Hershoran, H.
Mar. 4
Mar. 18
Edwin Hotel
Sher, D. and
Saltzman, S.
Mar. 29
Mar
(still in force
31, 1946)
Walker House
Walker House
Hotel Company
Aug. 8
Aug. 22
Waverley Hotel
Waverley Hotel Co.
Jan. 24
Jan. 29
WALLACEBURG
Tecumseh Hotel
Mahoney, A. J.
Feb. 15
Mar. 18
WINDSOR
Bellvue Hotel
Mandich & Opacich
Sept. 5
Sept. 25
«
Dominion Hotel
Boyer, W. H.
Sept. 5
Sept. 12
"
Howard Hotel
Ouellette, L.
Nov. 1
Dec. 20
YORK MILLS
New Jolly Miller
Hotel
New Jolly Miller
Hotel Company
Jan. 16
Feb. 1
SARNIA
SAULT STE.
MARIE
TORONTO
WINDSOR
CLUBS
Sarnia Service Club
Troubadour Club
Fourth Battalion Club
Army and Navy Veterans, Unit No. 30
Feb. 15 Mar. 1
Dec. 19 (still in force
Mar. 31, 1946)
Nov. 26 (still in force
Mar. 31, 1946)
Oct. 18 Nov. 19
100 ANNUAL REPORT OF No. 52
SCHEDULE No, V
Statement of Expenses
April 1st, 1945 to March 31st, 1946
Salaries $ 89,897.15
Rent 1,935.00
Travelling Expenses 36,249.69
Postage 1,793.91
Stationery and Printing 4,394.05
Telephone and Telegraph 912.57
Heat, Light and Power 180.00
Advertising 490.65
Equipment Rental , 180.00
Deputy Registrars' Expenses 73.50
Express Charges 39.11
Maintenance (Miscellaneous) 1,982.70
Remuneration of Deputy Registrars 7,815.00
Audit Fees 4,250.00
Superannuation 1,221.74
TOTAL $151,415.07
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LOWE-MARTIN CO. LiMiTED
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ONTARIO ROYAL COMMISSION ON FORESTRY
MAP No. 6
POSSIBLE DIVISIONS
— FOR—
FOREST OPERATING COMPANIES
'T»/-
C
QUEBEC
ONTARIO ROYAL COMMISSION ON FORESTRY
Map No. 1
PROPORTION OF WOODED LAND
IN
SOUTHERN ONTARIO
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ONTARIO ROYAL COMMISSION ON FORESTRY
MAP No. 4
WATERSHED CONTROL
UNDER THE
CONSERVATION AUTHORITIES ACT
AUTHORITY ESTABLISHED
AUTHORITY UNDER ACTIVE CONSIDERATION...
AUTHORITY PROPOSED
20 10 0
MOes
40
,IMISSION ON FORESTRY
• No. 9
^EAS OF OVER 500 ACRES
1936 and 1946. .. . IHBi
L920and 1935... ■■■
^^
MOrt
40 60 80 100
^^»
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'<^
s V p e
V O
ONTARIO ROYAL COMMISSION ON FORESTRY
MAP No. 6
POSSIBLE DIVISIONS
— FOR—
FOREST OPERATING COMPANIES
n
jL^
ONTARIO ROYAL COMMISSION ON F
MAP No. 5
Districts of Origin of Pulpwoo<
(BASED ON 1946-47 EXPORT COMMIT^
PRINCIPAL AREAS OF CROWN LANDS FROR
EXPORTS OF PULPWOOD ARE PERMITTED..
FIGURES SHOW THE PERCENTAGE OF TH
EXPORTS OF PULPWOOD, BOTH FROM CROW
AND PRIVATE LANDS, WHICH ORIGINATES
DISTRICT
ESTRY
RESTS
ONTARIO ROYAL COMMISSION ON FORESTRY
MAP No. 8
DISTRIBUTION OF PUBLIC AND PRIVATE LANDS
CROWN LANDS WITH CUTTING RIGHTS LEASED
For Timber and Pulpwood ■
For Pulpwood Only
For Timber Only B
CROWN LANDS NOT LEASED
Cutting Rights Reserved - Timber and Pulpwood ... Q
Cutting Rights Reserved - Pulpwood Only
No Cutting Rights Reserved or Leased D
CHIEFLY PRIVATE LANDS
(Including Certain Indian Reserves) ■
-^ /
/
ONTARIO
3M MISSION ON FORESTRY
^ No. 11
\ND PULP AND PAPER MILLS
,000 f.b.m. Annually •
100,000 f.b.m. and
▲
000 f.b.m. Annually ■
RY
STS
40 60 80 loo
^Ai
LAKE ONTARIO
ONTARIO ROYAL COMMISSION ON FORESTRY
MAP No. 10
COUNTY AND MUNICIPAL FORESTS
Land under Municipal Reforestation Act
Land not under Municipal Reforestation Act
mumtmrnamMmai
ONTARIO ROYAL COMMISSION ON FORESTRY
MAP No. 9
REPORTED BURNED AREAS OF OVER 500 ACRES
Burned-over between 1936 and 1946 .... ^^H
Burned-over between 1920 and 1935 .... ^HH
ZO 10 0 20 40 60 80 100
B
ONTARIO ROYAL COMMISSION ON FORESTRY
MAP No. 11
LOCATIONSfOF SAWMILLS AND PULP AND PAPER MILLS
Sawmills Cutting under 100,000 f.b.m. Annually •
Sawmills Cutting between 100,000 f.b.m. and
1,000,000 f.b.m. Annually a
Sawmills Cutting over 1,000,000 f.b.m. Annually ■
Pulp and Paper Mills ®
ZO 10 0 20 40 60 80 100
\
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ONTARIO ROYAL COMMISSION ON FORESTRY
MAP No. 10
COUNTY AND MUNICIPAL FORESTS
Land under Municipal Reforestation Act I
Land not under Municipal Reforestation Act |
COUNTY
Brant
Bruce
Carleton
Duff erin
Dundas
Durham
Elgin
Essex
Frontenac
Glengarry
Grenville
Grey
Haldimand
Halton
Hastings
Huron
Kent
Lambton
Lanark
Leeds
Lennox and Addington.
Lincoln
Middlesex
Norfolk
Northumberland
Ontario
Oxford
Peel
Perth
Peterborough
Prescott
Prince Edward
Renfrew
Russell
Simcoe
Stormont
Victoria
Waterloo
Welland
Wellington
Wentworth
York
*Areas less than 100 acres not plotted.
Acreage
Acreage
under
not under
the Act
the Act
59*
5.245
90*
700
1,440
235
124
1.375
175
90*
'266
1,550
4*
1.891
223
607
177
483
20*
700
1.600
3*
12*
240
1,723
1.550
1.075
50*
590
65*
75*
3,000
219
1 1,000
9,375
4i6
70*
3,600
545
1,759
436
2.6.
12
)8
65*
42,4«
12,974
0 N
BAY
J A
M e\S
'>!;«)<
^7*
I '^''^^
S ^ P E
/ o
ONTARIO ROYAL COMMISSION ON FORESTRY
MAP No. 7
LOCATIONS OF INSPECTIONS MADE BY THE
COMMISSION IN 1946
Inspections •
Field Bases (Mobile Office) ©
Approximate Limit of Commercial Timber ... — . —
Limits of Protection Area — x
Northern Reconnaissance Flights ^^^
L
Ontario Royal Commissioii
on
Forestry
GLOSSARY OF TERMS
Used in 1947 Report
GLOSSARY OF TERMS USED IN REPORT
Note: This glossary is intended primarily for the
layman and therefore strict scientific accuracy is sometimes
subordinated to simplicity. It defines the various technical
or semi-technical terms and uncommon words used m the
report which are not in everyday use and which in many
cases are not to be found in a standard dictionary. The
definitions given cover only those meanings which are
applicable to the terms defined in the sense in which they
are used in this report. Terms which are self-explanatory
or which are fully defined in the body of the report are not
included.
Advance-reproduction (or advance grov^th). Young
trees which have become established before cutting
operations are begun.
Age-class. One of the intervals into which the range of
ages of trees is divided for classification. Thus, a 60-80
year age-class means that the trees in that class range
from 60 to 80 years of age.
All-aged. A term applied to a stand in which, theoreti-
cally, trees of all ages up to and including those of the
maximum natural age of any species in the stand.
Allowance for trim. The permissible excess (by regula-
tion not more than six inches) of the actual length of
the sawlog over the recognized length it is deemed to
be for the purpose of collection of stumpage. The
recognized lengths rise by one-foot intervals from eight
feet. Some allowance is necessary so that the lumber
sawn from a log may be trimmed squarely and accur-
ately to one of the accepted standard lengths with a
minimum of waste.
Annual growth. The volume of wood on a given area
added in one year by reason of the growth in height
and diameter of the trees on the area. Also called the
annual increment.
Ash (Fraxinus). Four species of this genus of deciduous
tree occur in Ontario, of which black ash (Fraxinus
nigra) is the only one occurring to anj' extent north of
the portion of the Province known as Old Ontario.
White ash (Fraxinus americana) is particularly
useful in the manufacture of sporting goods and for
other purposes where toughness is an important quality.
Balsam or balsam fir (Abies balsamea). A coniferous
tree to be found growing in almost all parts of Canada
except the extreme western areas. It is suitable chiefly
for pulpwood and sawlogs.
Banksian pine. See Pine.
Berth (or timber berth). A block of publicly-owned
forest land on which the right to cut timber is leased
or granted.
Bid. That part of the stumpage rate paid for Crown-owned
timber in Ontario which is set at the discretion of the
successful bidder by public auction sale.
Birch (Betula). Three species of birch are native to
Ontario. Of these yellow birch (Betula lutea) is the
most valuable but has a more limited range, being
found chiefly in Old Ontario, along the northern shore
of Lake Huron, and in the Algoma district and to a
lesser extent along the international border west of the
Lakehead. It is a generally useful hardwood in demand
for furniture, flooring, plywood, etc. White birch
(Betula papyrifera) is found practically throughout
the forests of Ontario. It is used to some extent for
lumber and handles and other small woodenware.
Grey birch (Betula populifolia) is commercially un-
important in Ontario and is found only in the eastern
part of the Province.
Black Spruce {Picea mariana). See Spruce.
Blow-down. A tree, or a stand of trees, overthrown by
the wind.
Blow-sand (area). Land consisting of light sandy soil
subject to erosion by the wind. See also Soil-drift.
Bolt. A short log cut to a special length convenient for
making barrel staves, shingles, spools, etc. The term
may also be applied to individual pieces of pulpwood
in short lengths. It is usually prefixed by the name of
the article which is to be made from it, e.g., stave-bolt,
shingle-bolt, etc.
Bonus. A premium payment in addition to a standard
rate. Thus, in Ontario the term applies to that part
of the stumpage rate paid for Crown-owned timber
which is in excess of the standard basic rate (dues)
but excludes the portion bid. It may be fixed by
departmental action or by negotiation with the lessee.
In New Brunswick the term applies to an annual pay-
ment for the retention of cutting rights on Crown
lands in addition to the established "ground rent".
Also a payment or subsidy paid to defray part of the
cost of, or to encourage, a desirable practice or under-
taking.
Boom. A series of logs or timbers fastened together end to
end by chains or cables for the purpose of: (a) forming
artificial channels in streams or rivers through which
logs or pulpwood may be floated or "driven" with a
greater measure of control, or (b) encircling a quantity
of float-logs or pulpwood so that the whole mass can be
held safely in storage or can be towed by boats. The
individual components of a boom are called "boom
timbers".
Borers. Types of forest insects which tunnel into the wood,
or between the bark and the wood, of standing or
felled timber.
Box shooks (or shook). Pieces of lumber cut to specified
sizes and to be later made into boxes.
Browse. Leaves, twigs and shoots of trees and shrubs
available as forage for animals.
Buck. An adult male deer.
Budworms. Types of insects which at one stage in their
life-cycle feed on the leaf-buds of trees and the leaves
themselves causing partial or complete defoliation and
often the death of the trees so injured.
Bulldozer. Primarily, but by no means exclusively, a
road-building machine consisting of a crawler-type
tractor fitted with a dirt-moving blade which is mounted
horizontally across the front and which can be raised
or lowered mechanically. Hence, "bulldozing" is the
act of using a bulldozer.
Burn. An area over which a forest fire has swept and on
which a new forest is not yet established.
Butt. The base of a tree or a term used to describe a log
containing that part of a tree. Also the lower end of a
log in relation to its original position in the tree.
Carrying capacity. The greatest population of any kind .
ol wild animal which a given area can sustain in food,
shelter health and relative safety. Also the measure of
the ability of a stream or river to carry a drive.
Car stakes. Poles about three to six inches in diameter
and nine to twelve feet long used to secure loads on
open railway freight cars.
Cedar (Thuja occidentalis). An evergreen tree found
growing chiefly on swampy land in all parts of Ontario
except the extreme northern portion. Particularly
useful for poles, posts, shingles, and other products
calling for durability or lightness. Also a favorite
winter browse for deer.
Check-scaling. In the measurement of timber, checking-
scaling bears the same relationship to scaling, as in
accounting practice, auditing bears to book-keeping.
That is to say, it is a checking and testing of the original
measurements and their compilation. See Scaling.
Chemical-pulp. Forms of woodpulp manufactured by
treating wood chips with hot chemical solutions which
dissolve some of the constituents of the wood and thus
separate, and to a considerable degree change the quali-
ties of, the individual wood fibres. Compare Ground-
wood (pulp). See Soda-pulp, Sulphate-pulp and
Sulphite-pulp.
Clear-cutting. The removal of the entire stand of mer-
chantable timber on a given area in a single operation.
Climate, continental. The type of climate characteristic
of the interior of a continent. As compared with a
maritime climate, a continental climate has a wide
annual and daily range of temperature.
Climate, maritime. A type of climate characteristic of
the ocean, oceanic islands, or coastal regions, its most
prominent feature being equability of temperature.
Composition. The relative proportions in which various
species of trees occur in a forest stand.
Conifer. A term applied to species of trees which bear
their seed in cones. Conifers include the pines, the
spruces, balsam, hemlock, cedar, and larch, the last-
named being the only conifer native to Ontario which is
not an evergreen.
Cord. A unit of measurement of stacked wood defined by-
federal Statute as the amount of wood which can be
piled in a space containing 128 cubic feet, but presently
used in Ontario to denote several different volumes.
See pages 110, 164.
Crown cover. The canopy of leaves and branches formed
by the crowns of all the trees in a forest stand.
Cull. To reject a tree, log, or piece of lumber in scaling
or grading. Also a term applied to lumber of very low
quality but still marketable. Also a tree or log rejected
for use because of poor quality.
Culler. See Scaler.
Cut. A season's output of logs or the output of lumber
from a sawmill in a given period. Hence an annual
cut is the quantity of forest products cut on a given
area in a year.
Cut-over. Descriptive of forest areas on which felling
operations have recently been conducted, and on which
there is usually left a quantity of tops, branches and
other highly inflammable debris.
Cutting-cycle. The planned interval between major
felling operations in the same stand, or the planned
period in which all parts of a given forest area are cut
over in orderly sequence.
Deciduous. Descriptive of all species of trees which shed
all their leaves each autumn as distinct from evergreens
which shed and renew their leaves progressively.
Forest policy. The principles and broad plans adopted by
a government or the owner of timberland regarding the
use, management, exploitation, and protection of the.
forest. In the case of governments, employment,
industrial development, forest taxation, the exportation
of forest products, land-use, reforestation, and many
other matters enter into any comprehensive forest
policy; in short all the many phases of forestry and
forest economics which may have a bearing on the
welfare of the community.
Fuelwood. This term usually applies to wood cut in the
forest or woodlot and intended primarily as a domestic
fuel for heating or cooking. It is sometimes applied
also to wood refuse accumulated at sawmills which
may be used as either domestic or industrial fuel.
Game sanctuary. An area in which hunting is prohibited
for the specific purpose of providing a safe breeding
ground for game.
Girdling. The removal of a portion of the bark of a tree
completely encircling the trunk. The delicate growing
tissue, called the cambium, is thus exposed or is
removed along with the bark, and in either case the
death of the tree follows. Porcupines and beaver often
girdle trees while obtaining food and thus do consider-
able damage in the forest.
Grading. The art or science of classifying lumber,
piece by piece, according to established standards of
quality, or grades.
Ground rent. An annual rental charged forest operators
by the Government for Crown timberlands leased to
them. The current and maximum basic rate in Ontario
is $5.00 per square mile per year, but in effect the rate
varies with circumstances and according to terms of the
agreement or license.
Groundwood. A type of woodpulp made by grinding
bolts of wood under a stream of water on a revolving
stone in such a way that the fibres of the wood are
separated but remain chemically unchanged.
Growth ring. The ring visible on a stump or log which
indicates the boundaries of one year's growth of the
tree.
Habitat. The kind of place in which, or site on which,
any specified animals, insects or plants live by pre-
ference and where conditions are suitable for their
healthy development.
Ha^d^yood. Generally, one of the botanical group of trees
which have broad leaves in contrast to the needle-leaf
trees, or conifers. Also the wood or lumber produced
from such trees.
Hemlock (Tsuga canadensis) . A conifer, found growing
m that part of Ontario south of the Height of Land
and west through the Algoma district, but less abun-
dantly than in the past. Formerly cut in great quanti-
ties for the purpose of securing the bark which is used
m the tannmg of leather. Now used chiefly for con-
struction lumber and crating, but also usable in limited
proportions in the manufacture of pulp.
Hewn timber. A form of timber cut in the past (usually
ot white pine in Ontario) which was hewn out of the log
m the forest by hand with the aid of a special (broad)
axe. The timbers were usually square in cross-section
and as large as the dimensions of the log would permit
such timbers were called "square timbers",
Hickory (Carya). There are five species of hickory native
to Ontario, but their range in the Province is confined
to the southwestern counties, and even there they are
becoming increasingly scarce. The wood of these
species is heavy, hard, and very tough and is in great
demand for many purposes particularly for handles for
striking tools. Substantial quantities are imported
annually from the United States.
High-grading. The practice of cutting a forest stand so
that only the best wood, or that most cheaply or easily
removed, is taken, the rest being left to deteriorate
or die.
Humus. The layer of decaying vegetable and animal
matter covering the soil itself which is usually to be
found in the forest or woodlot. This may be destroyed
by grazing cattle, or by forest fire, or by impropier
cutting practices. The destruction or removal of the
humus is often followed by erosion.
Insecticide. Any chemical used to kill insects.
Inventory. In relation to forests an inventory is a survey
to determine the area and condition of the forest stand,
its volume and the species which compose it, and all
other data required as a basis for sound policies and
management and wise cutting programmes and
methods.
Jack pine (Pinus Banksiana). See Pine.
Jobber. A contractor who carries on forest operations on
behalf of the person or company owning or leasing the
timberland. The extent of their individual operations
may be small and one owner or lessee may employ
several jobbers. In the case of Crown lands, the lessee
is responsible to the government for the work done by a
jobber in his employ.
Kraft. See Sulphate pulp.
Land classification. A system of classifying land accord-
ing to the use to which it may best be put presently or
in the future. Thus, in Ontario the major classifications
might be farmland, forest land, and mining territorv',
though in addition there would be other primary
classifications and many sub-classifications.
Larch (Larix laricina). Larch, or tamarac, is the only
deciduous confier native to Ontario where it is found in
swamps and lowlands of all the forested portions of the
Province. The species is of little immediate commer-
cial importance because no stands of it are more than
forty of fifty years old. Early in this century all then
existing stands were virtually wiped out by an insect
epidemic, but the species is now re-establishing itself
fairly satisfactorily. The timber is among the hardest
and heaviest of the so-called softwoods in Canada, and
it is noted for its durability.
Larva (plural larvae). The grub-like, worm-like or
maggot-like stage in the life-cycle of certain moths,
beetles, and other winged insects. It is during this
stage that the greatest amount of feeding is done and
hence the most damage.
Leader (shoot). The terminal shoot of the main stem of a
tree, or the shoot that takes its place if the genuine
leader is killed, at the tip of which all growth in the
height of a tree takes place.
Length-class. One of the arbitrary standard lengths,
usually of even feet, into which logs are classified for
convenience. The interval between classes is usually
one foot.
Lichens. A partnership of interdependent plants which
crow on rock, bark, etc. One plant in the partnership
IS a fungus and the other an alga (both low forms of
plant life) and each is essential to the life of the other.
These plants are an important part of the diet of
cariboo.
Life-cycle. The aeries of stages in the life, form, and
way of living through which some plants and animals
pass. For example, white pine blister rust cannot
complete its life-cycle on the white pine tree, but must
pass to gooseberry or currant bushes to complete one
phase of it quite different in appearance and way of
living from the form assumed on the white pine. Or
again, the adult spruce-budworm moth lays eggs which
hatch into larvae which in turn pass through five stages
of life before entering the pupa, or chrysalis, phase.
From the pupae adult moths emerge thus completing
the insects' life-cycle.
Lifter. A special piece of equipment for lifting seedlings
or transplants from beds in a forest nursery.
Lignin. A compound chemically related to cellulose and
with cellulose forming the essential part of wood
substance. Lignin forms the adhesive bond which
holds the individual wood fibres together, and this
substance is removed from the wood in chemical
methods of manufacturing woodpulp. The lignin made
available as a by-product in the making of pulp can be
used in the manufacture of adhesives, plastics and
other products.
Limit. A tract of timberland owned by a "limit owner"
or leased by a "limit holder" from the Crown for the
purpose of conducting a forest industry.
Lodge. The partially submerged dwelling place of a family
of beaver, built of sticks and mud.
Log-deck. The platform in a sawmill upon which logs
are held in readiness to be sawn.
Log-rule. Any mathematical, graphical, or tabular system
by which the contents of a sawlog may be estimated in
terms of feet board measure of the lumber which it
may yield. There are a great many different log-rules,
but a few of them, such as the Doyle log-rule, are
grossly inaccurate.
Log-scale. See Log-rule.
Lookout tower. A steel or wooden tower surmounted
by a cabin or platform, commanding a wide view of the
surrounding forest, and from which any forest fires
occurring in the region may be observed. The observer
is in communication by telephone or radio, or both,
with the fire-fighting service and can report the compass
bearmg and approximate distance of the fire from the
tower. Compass bearings on the same fire from two or
more towers fix its location accurately. A compass
bearmg and the approximate distance from one tower
will enable an air-borne observer to find, and accurately
fix the location of, a fire.
Lumber. To engage in forest operations. Also boards
planks, etc. sawn from logs. "Rough lumber" is
lumber which has not been planed or dressed
M. Thousand Thus 200,000 M. f.b.m. means two
hundred million feet board measure.
Maple (Acer). There are seven species of maple native
to Ontario most of them confined to that part of the
Province south of the latitude of Timmins and Port
Arthur. By far the most important species is sugar
10
or hard maple (Acer saccharum) which, besides being
the source of maple syrup and maple sugar, is in great
demand for lumber for furniture, flooring, and a great
many other products. It is also a prized fuel. "Sfjft
maple" is a name given to either silver maple (Acer
saccharinum) or red maple (Acer rubrum) which
are otten found growing on wet ground of poor fer-
tility and which have little commercial value except as
fuel.
Marginal. Of lands or soils that which produce or can
produce a crop which, when sold at existing market
prices, will barely return the cost of production. Also
of any undertaking the cost of which is as great as,
or nearly as great as, the return it brings.
Marks (timber). Marks painted, hammered, or chopped
on logs to identify ownership; similar to a trade mark.
Hence "timber marking" is the process of marking
logs with one's own peculiar brand or mark.
Mattock. An implement for digging or grubbing, not
unlike a pick in general appearance, particularly useful
in fighting forest fires.
Maturity-age. The age at which a given species or stand
of timber becomes ripe for cutting. Before maturity-
age the timber is not fully developed either from the
physical or economic standpoint, while after reaching
maturity-age it is likely to deteriorate or at best does
not increase in value. Different kinds of trees or stands
have different maturity-ages.
Measuring-worm. A particular genus of caterpillar
which has a looping motion when crawling. Several
species are serious defoliators of conifers and hardwoods.
Merchantable. A term used to describe logs or lumber
of such size and quality as to be acceptable on the open
market at current normal prices.
Mixed stands (or mixedwood stands). Sometimes this
term refers to stands of timber composed of several
conifer or several hardwood species, but it is more
generally applied to stands composed of a mixture of
both hardwoods and conifers, and is so used in this
report.
Moraine. The deposit of gravel, sand, or boulders left by
a melting glacier. Glaciers covered a large part of
what is now Ontario during the Ice Age.
Multiple-use operation. A forest operation in which a
number of different products, such as pulpwood,
sawlogs, poles, veneer-logs, and fuelwood, are extracted
simultaneously according to the ability of the stand to
yield these products and the capacity of the market -
to absorb them, each tree cut being converted into that
product for which it is best suited. This is a practice
very rarely followed at present in Ontario. Compare
Single-purpose operation.
Natural forest. A forest not grown from seeds or seed-
lings planted by man.
Natural reproduction. Seedlings or young trees grown
from seeds from neighbouring trees. That is to say,
natural reproduction is the way in which a natural
forest perpetuates itself. Compare Plantation.
Newsprint. The type of paper on which newspapers are
usually printed. It consists of roughly four or five
parts of groundwood pulp to one part of sulphite pulp.
In volume and total value (but not in unit value)
newsprint is by far the most important product of the
paper industry of Ontario. The manufacture of other
11
types of paper gives more employment and brings
higher returns per ton of output.
Oak (Ouercus). There are about eight species of oak
native to Ontario and all grow most commonly, but
not too abundantly, in Old Ontario. Scattered red oak
(Ouercus borealis) and bur oak (Quercus macro-
carpa) are to be found as far north as the Height
of Land; while white oak (Quercus alba) grows
sparsely in the Algonquin Muskoka regions. Oak is
strong, hard, tough and durable and is one of the most
valuable of Ontario trees. It is in great demand for
furniture (chiefly white oak), flooring, vehicle and farm
implement construction, interior trim, and a host_ of
other purposes. The supply of good oak is dwindling
in Ontario and much is imported from the United States
every year.
Operation. The whole sequence of activities involved in
getting timber to the mill or loading point, including
felling, bucking, skidding, hauling, and driving as well
as the preliminary activities such as the construction
of roads, camps, dams, or other structures necessary
to facilitate the extraction of timber.
Operating plan. A plan setting out the details of an
imminent operation, as distinct from a working plan
which deals with the long-term exploitation of a forest
area. An operating plan includes information on the
volume of timber to be cut, the type of product to be
taken, the area on which the operation will be con-
ducted, the number of men to be employed, improve-
ments and facilities to be constructed and other
pertinent data of like nature.
Outfitter. One who makes a business of supplying
hunters, anglers and tourisfs with the equipment neces-
sary in their chosen form of recreation and who often
organizes and conducts fishing and hunting parties.
Overcut. To cut a greater volume of timber on a given
area than is replaced by new growth on the entire limit
of which the cut-over area is part, or to cut a quantity
of timber on an area in excess of what is indicated as
proper according to good forestry practice.
Over-length tolerance. The same as Allowance for
trim in the case of sawlogs, but in Ontario, in the case
of unbarked pulpwood, an over-length tolerance of
two inches in four feet is allowed to compensate for the
smaller amount of wood in a cord of unbarked wood
than in a cord of peeled wood. The stumpage rate per
"cord" is the same in both cases, however.
Over-mature. Descriptive of a tree or stand which has
passed beyond its prime and is deteriorating. Over-
mature stands are apt to be unhealthy and susceptible
to attack by insects or disease and are thus a menace
to nearby younger stands. Over-mature stands should
be cut to make room for young vigorous ones, otherwise
an economic loss is sustained.
Overrun. The amount by which actual production
exceeds the estimated production. With reference to
log-rules it means the excess of the quantity of lumber
produced from a given lot of logs over the total arrived
at by scaling the logs according to any given log-rule.
Thus, to say the Doyle rule gives a large overrun on
small logs means that the actual production of lumber
y"? small logs is much greater than the application
of the Doyle rule to their measurement indicates.
12
Overscale. Descriptive of a log-rule which overestimates
the quantity of lumber a given log, or group of logs,
will yield. That is to say, the opposite of what the
Doyle rule does.
Parasite. A plant (generally a fungus) or animal (generally
an insect) which lives in or on another plant or animal
from which it draws its nourishment but gives nothing
in return. Thus white pine blister-rust and rot-causing
fungi are parasites of the trees in which they live,
while lice are parasites of the animals they infest. In
entomological work, in particular, man makes use of
parasites on a large scale to help destroy insect pests.
Pier. In forest operations a pier is a timber cribwork
built in the water or along the bank of a stream and
filled with rock to keep it in place. A pier may serve
as a mooring to which booms may be fastened, or may
be used along a river to guide logs through stretches of
rough water taetween rocky banks where the timber
might otherwise become jammed.
Pitch. A gummy substance occurring in the wood of
certain trees, generally conifers, of which the pines are
good examples. An excessive proportion of pitch in a
wood renders it unfit for making some types of wood-
pulp. Pine and other pitchy woods can satisfactorily
be used in making sulphate pulp.
Pile bottom. Round timbers specially cut and placed on
the ground to form a firm and reasonably level founda-
tion on which to pile logs or bolts in the woods.
Piling. Round timbers in long lengths similar to telephone
or telegraph poles, but used to drive into the soil to
provide a secure foundation for structures built on
soft, wet, or submerged ground.
Pine (Pinus). Four species of pine are native to Ontario
of which three are of great commercial importance and
one of virtually none. White pine (Pinus strobus) is
the species on which the great lumbering industry of
Ontario was founded, but the fine virgin stands of it
are now practically all gone and cannot be restored in
their former greatness for generations. Second-growth
white pine will continue to be an important, but per-
haps not dominant, wood in our lumber industry.
White pine grows in all parts of the Province south of
the Height of Land, but reaches its best development
in the Ottawa Valley, the Georgian Bay region, and,
to a lesser extent, in the Rainy River area. Good-
quality white pine lumber is one of the most highly
prized softwoods in the world. Its uses as lumber are
legion, but it is not used for pulp partly because it is
suitable only for the sulphate process but more particu-
larly because its value is greater for other purposes.
Red pine (Pinus resinosa) is another important species
for making lumber although the best stands of it, too,
have all but gone. Red pine grows over practically
the same range as does white pine, and the two species
often grow side by side in the forest, though red pine
tends to grow in pure stands more than does white pine.
There is always a good demand for red pine lumber for
construction work and general carpentry purposes
and this species also makes excellent poles and piling'
Jack pine or Banksian pine (Pinus banksiana) is
the most widespread of Ontario pines being found in
practically all forested areas of the Province north of
the Muskoka region. It makes a fine general-purpose
lumber and is sought after for poles, piling and ties.
13
It is excellent for use in the manufacture of siilphate
pulp and can also be used in limited proportions in
other kinds of woodpulp. In short, although this
species was neglected in the past, its all-round useful-
ness and its ubiquity will make it an increasingly
important timber as white pine and red pine dimiriish
in significance, which they are bound to do for a time
at least.
Plantation. An artificially created forest established by
planting seedlings or, more rarely, by sowing seed.
Plantations are relatively expensive to establish and
are usually resorted to only when natural methods of
establishing a forest fail or cannot be used.
Plywood. Panels constructed of an odd number of thin
layers of wood (veneer) glued together in such a way
that the grain of the wood in adjacent plies is at right
angles. It is widely used in house construction, furni-
ture manufacture, and for a great many other purposes.
In Ontario, yellow birch is the wood most commonly
used for making plywood, but it is probable that other
species will be used for this purpose in increasing quanti-
ties. Poplar, maple, white birch, red pine, white pine,
oak, and several other species lend themselves to this
use. See Veneer-log.
Pole. Round timber in long lengths usually used to
support power lines or telephone or telegraph wires.
In Ontario, red pine and jack pine are used extensively,
though cedar is a favorite wood when it can be secured
in suitable quality but cedar of the desired type is
becoming scarce. Poles must meet quite rigid standards
of size and quality and are almost invariably given a
chemical treatment to render them more resistant to
decay. See Treating.
Poplar (Populus). There are four species of poplar
native to Ontario. Two of them — aspen (Populus
tremuloides) and balsam poplar (Populus tacama-
hacca) — occur in all the forested parts of the Province
while the others- large-toothed aspen (Populus
grandidentata) and the sparser cottonwood (Populus
deltoides)— do not occur north of the Height of Land.
The poplars are rather neglected species which should,
and probably will, command more attention in the
future. Poplar is used extensively in the manufacture
of soda pulp, and is u.sed to a lesser extent in making
other types of woodpulp though its possibilities in this
direction are not yet fully exploited. Selected poplar
IS in strong demand for making matches. The species
will also yield good general-purpose lumber, crating
material, excelsior, and many other products. Poplar
IS very prolific in Ontario.
Portable mill. This term refers to sawmills of a type
which can be moved from place to place with relatively
httle trouble or expense. At present they tend to
produce rather poorly manufactured lumber, but this
could be overcome by improvements in design and
maintenance and by the instruction of their operators
1 heir worst feature is that, under existing conditions
they are notoriously wasteful of raw material.
Power pump. A gasoline-driven pump. Several tvpes are
especially designed for use in fighting forest fires and
usually these are so light and easilv handled that thev
can be carried by one or, at most, two men. They are
invaluable weapons to the fire fighter.
14
Precipitation. Chiefly rain and snow but, strictly
speaking, moisture in any form deposited from the
atmosphere, such as dew, hail or hoarfrost.
Predator. An animal which preys upon and devours
other animals. Thus birds, certain small mammals,
frogs and toads, and even fish, are predators of insects.
Pulp. See Woodpulp and Pulpwood.
Pulpwood. Round wood cut for the specific purpose of
being made into woodpulp. It is usually cut in lengths
of approximately four feet or eight feet in the woods,
but occasionally it is transported in longer lengths
and cut up at the mills. Pieces of pulpwood do not
need to be of large diamter, in fact it is usually
better that they be fairly small, but unfortunately
large trees more suitable for sawlogs or poles are often
cut for pulpwood. Spruce is by far the most popular
species for making woodpulp, but balsam, jack pine,
poplar birch, hemlock, and other species can, and
should, be used more than they are. Pulpwood is
often, though incorrectly, referred to as pulp.
Ranger. A junior-grade employee of the Department of
Lands and Forests whose duties are chiefly in the
field and relate to fire prevention, fire suppression,
fish and game protection, maintenance of telephone
lines, inspection work, and sometimes scaling. A
Chief Ranger is the senior representative of the Depart-
ment in his area, or "Ranger Division". He is respons-
ible directly to the District Forester and is in charge of
all Rangers in his area.
Rate of growth (per acre). The speed at which the
volume of wood in a stand of timber increases as the
trees grow, usually stated in terms of cubic feet per
acre per year. It is influenced by the species, the site,
the climate, the soil, the cutting methods practised,
and other factors.
Rear. See Sweep.
Red-heart. A type of rot, often not of a very detrimental
nature in its early stages, which causes the heartwood,
or central core of a tree, to turn reddish brown in color.
All such rots are caused by fungus growth.
Red pine. See Pine.
Reforestation. The artificial restocking of an area with
forest trees, usually with transplants but occasionally
by the sowing of seed.
Refuse burner. An incinerator, often of very crude and
unsafe design, used at sawmills for the purpose of
disposing of by-products for which no other outlet
has been found.
Regeneration. The process by which a forest, woodlot,
or stand is renewed after being cut, burned, blown
down, or otherwise killed. It may be brought about by
either natural or artificial means.
Reproduction. See Regeneration.
Residual stand. The stand remaining after a cutting.
Re-stocking. The replacing of artificially reared fish in
lakes or streams in which the fish population is depleted
by reason of too much angling or from other causes.
RoUway or Skidway. An orderly pile of logs usually built
near a road so that the logs may conveniently be loaded
on trucks or sleighs, or near a river or lake in which
they may be placed when the drive begins. See illus-
trations on pages 165 and top of 166.
Rotation. The cycle represented by the growth of a new
tree to a predetermined state of maturity usually,
15
but not necessarily, in place of a like one cut down.
The length of this cycle depends, among other things,
upon the species of tree involved, the characteristics
of the soil and site, and the silvicultural methods used
in exploiting the stand.
Salvage operation. An operation conducted for the
purpose of extracting timber dying or killed as the
result of damage by fire, insects, disease, storm, or
floods, or threatened with death from these or other
similar causes.
Sand -drifting. See Soil-drift.
Sawlog. A log of suitable size and quality to be sawn
into lumber.
Scaler. One who measures wood cut in the forest and
computes the volumes of cut wood. In Ontario only
those licensed to do so may scale wood from Crown
lands, and licenses are issued only after the applicant
has passed an examination to test his knowledge and
skill. Culler is an older, but now little-used, name for
this occupation.
Second-growth. The forest which develops after the
removal of the virgin timber by cutting, fire, or any
other cause.
Seed collection. The process of gathering seeds from
trees to supply to forest nurseries or to sow in areas
selected for reforestation. In the case of conifers the
cones, which contain the seeds, are collected before
they open.
Seeder. A mechanical device used for sowing seed in a
forest nursery.
Seed extraction plant. An establishment for preparing
tree seed for sowing. The processes include drying the
cones (in the case of conifer seed) to open them,
extracting the seed, cleaning the seed, testing the
germinating power of the seed, and storing the seed
under proper conditions.
Seedling. A very young tree in the forest or woodlot or,
in nursery practice, one not yet set out in a transplant
bed.
Seed tree. A tree left standing after an operation for the
specific purpose of supplying the seed necessary for the
renewal of the stand.
Seigneurie. Land granted to a Seigneur (a French
aristocrat) by the French Crown in the early days of the
colonization of Canada.
Shingle. A thin, flat slab of wood tapering lengthwise
in thickness used in covering roofs or walls. Cedar is
the wood most in demand for this purpose.
Shingle-bolt. See Bolt.
Shook. See Box shook.
Silt. Fine particles of soils carried by the water in streams
and rivers as the result of erosion. Where the current
slackens or dies these particles fall to the bed of the
stream or lake and form a layer of mud. Silt also
discolors the water and prevents sunlight from pene-
trating the water to the detriment of fish and the
aquatic plants and animals on which they feed.
Silviculture. The producing and tending of a forest
scientifically.
Single-purpose operation. A forest operation in which
only one type of product, for example, pulpwood or
sawlogs or poles, etc., is removed. Compare Multiple-
use operation.
16
Sinkage. The loss of wood sustained by reason of logs
or bolts absorbing so much water during the drive that
they sink before they reach the mill or loading point.
Skidway. See Rollway.
Slab. The piece of wood removed by the first saw-cut
taken from the outside of a sawlog. This piece of wood,
then, has one flat, sawn surface and one rounded one
(usually with the bark still on it) and is tapered in
thickness.
Slash. Debris consisting of tops, branches, broken wood
and trees left on the ground after a logging operation.
Also, as applied to land, the term indicates an area
from which all merchantable timber has been stripped.
Slide. A flat-bottomed chute built of timbers down
which water is flushed so that logs can be safely floated
or slid instead of being driven through bad rapids or
over falls which might result in much breakage or cause
jams.
Soda pulp. A type of chemical woodpulp in which wood
chips are cooked in a solution of caustic soda. Hard-
woods are used extensively for this kind of pulp and the
resulting product is used largely for book-paper and
writing paper.
Soft maple. See Maple.
Soil drift. A type of erosion of light sandy soils brought
about by the action of the wind whereby soil-drifts,
comparable to snow-drifts, are formed.
Soil type. A classification of soil based on its composition
(as determined by cheinical and physical analysis)
and/or by its capacity to sustain agricultural or forest
crops.
Spawning bed. A spot in a lake or stream selected by
fish as a suitable place in which to deposit their eggs.
Depth of water, type of bottom, temperature of water,
character of underwater vegetation, and other con-
siderations influence the choice of site.
Spruce (Picea). Three species of spruce are native to
Ontario, but only two of them — white spruce (Picea
glauca) and black spruce (Picea mariana) — are of
substantial importance. These two species are found
throughout all parts of the Province where trees of any
kind grow. Spruce is an important species to the lum-
ber industry and vital to the pulp and paper industry.
The chart on page 39, however, indicates that spruce
is being over-cut and its use should be brought into
balance by using other species whenever they can be
satisfactorily substituted.
Square timber. See Hewn timber.
Squatter. One who settles on land which does not belong
to him. By law a squatter acquires title to Crown
land he may occupy under certain conditions including
undisturbed occupancy for a specified number of
years.
Stand. An aggregation of trees of uniform composition
as to species, age-classes present and condition,
occupying an area of any size but distinctly different
from the forest in adjoining areas.
Stave. One of the upright pieces of wood in the side of a
barrel, tub, pail, etc.
Stave bolt. See Bolt.
Stemwood. The wood of the main trunk of a tree as
distinct from the branches and roots. Often called
"bodywood" in Canada.
17
Strip-roads. Strips cleared at more or less regular and
frequent intervals throughout a pulpwood operation at
the sides of which the cutters pile the pulpwood taken
from the adjoining area, and over which the wood is
hauled out by sleigh in winter. These are discernible
as the pale irregularly curved lines in the aerial view
illustrated in the plate on page 24.
Stumpage. The amount charged by an owner for standing
timber usually in terms of the units of measurement of
the wood after it is cut. In the case of wood cut on
Crown lands the term means the sum of the dues,
bonus and other levies charged for the wood when it is
cut.
Sugar bush. A stand of sugar maple trees cultivated or
managed primarily for the production of maple syrup.
Sulphate pulp. This type of pulp, also known as kraft,
is made by cooking wood chips in a mixture of caustic
soda and sodium sulphide. The resulting pulp is
tough and is used for good-quality wrapping paper
and other purposes where strength is an essential
quality. Pine can be and is used extensively in the
manufacture of sulphate pulp.
Sulphite liquor. The liquid resulting from the manufac-
ture of sulphite pulp which contains, besides the original
chemical ingredients, the lignin extracted from the
wood. This sulphite liquor is usually discarded though
it can be, and sometimes is, used as a raw material in
the manufacture of many valuable products.
Sulphite pulp. A type of woodpulp made by cooking
chips in a solution of calcium bisulphide. The resulting
pulp is used, unbleached in the production of news-
print; after being bleached, in the production of
tissue, book and other papers and, in a more refined
form, it is the basic raw material in the manufacture of
rayon, cellophane and other products. Spruce is the
principal wood used but other species can be used to
varying but limited extent.
Sunscald. Injury (often fatal) to the sensitive growing
tissue under the bark of a tree caused by direct rays
of the sun. Forest-grown trees are not accustomed to
complete exposure to sunlight, and if a few trees are
left so exposed after an operation they are likely to die
of sunscald.
Sustained-yield. The crop of timber which can be
removed from a given area periodically without
impairing the ability of the area to yield the same
quantity of wood in an equal period in perpetuity.
Sweep. The process of re-floating stranded logs after a
drive has passed down a river. Where several operators
separately drive a river there may be a sweep after each
operator's drive to avoid the mixing of logs of different
ownership. Also the curvature in a log.
Tamarac. See Larch.
Tanbark. The bark of certain trees used in making the
solution in which leather is tanned. The bark of hem-
lock and certain oaks were used very extensively for
this purpose. In the case of hemlock the wood was
usually discarded after the bark was stripped ofT.
Thrifty. Descriptive of a tree or a stand which is in good
condition and growing at a satisfactory rate.
Tie. Timber sawn or hewn into pieces to support rails for
railway tracks. Selected hardwoods or softwoods are
used and the majority are now given a chemical treat-
ment with a preservative to prolong their usefulness.
18
Timber-line. The demarkation between wooded and non-
wooded areas. The economic timber line refers to the
northern limit of growth of timber of commercial size
in substantial quantity.
Timber-mining. An expression used to describe a ruth-
less felling of timber conducted without thought of the
renewal of the forest. Hence, a timber-miner is one who
conducts such an operation.
Top. The upper portion of a tree trunk with the branches
attached which is not economically usable, or at least
which is not used and is left in the woods.
Tower. See Lookout tower.
Towerman. The observer stationed at a lookout tower.
Transplanter. A mechanical device used in transplanting
tree seedlings from seed beds to transplant beds.
Treating. Timber may be chemically treated to increase
its durability when it is subjected to conditions favoring
decay or, more rarely, to render it resistent to fire, or
for other reasons. Such processing is done at treating
plants.
Tree planter. A mechanical device used to assist in the
planting of trees.
Trimming. The discarded pieces of wood resulting from
cross-cutting a board or a plank exactly to the specified
length and square across both ends.
Under-cutting. The cutting of a smaller quantity of
wood within an area than the equivalent volume added
by new growth on the area during the period between
operations.
Undersize. Descriptive of trees of smaller diameter than
the minimum at which they should be cut.
Veneer log. A log of special size and quality, and of a
desirable species, cut for use in making veneer. Veneer
is the name given to thin sheets of wood. It is usually
produced on a special lathe and the sheet of veneer is
cut from the log in a manner resembling the unwinding
of a roll of paper. Sometimes veneer is sliced from the
log as bacon might be sliced. Veneers are used for
making berry-baskets and fruit-baskets, but more
particularly in the growing plywood industry. Yellow
birch and elm are the species most used for this purpose
in Ontario, though other species are used to a lesser
extent.
Virgin stand (or forest). A stand or forest the develop-
ment and growth of which has not been influenced by
human activity.
Walkie talkie. A portable radio-telephone which can be
used to transmit and receive messages even while the
person carrying it is in motion.
Waste liquor. See Sulphite liquor.
Water table. The upper limit of the level at which the
soil is completely saturated with water. The water
table moves up and down according to the amount of
precipitation in the area and the natural or artificial
drainage.
White ash. See Ash.
White birch. See Birch.
White oak. See Oak.
White pine. See Pine.
White spruce. See Spruce.
Whitewood. A common name for poplar in some parts
of Ontario.
19
Wind-break. A belt of trees left standing, or planted,
for the purpose of giving shelter from the wind. A
wind-break may be used to shield a house, a garden, an
orchard, a road or railway, or farmland.
Wind-firm. Descriptive of those species of trees which
have root-systems which go deep in the soil and
thus make the trees resistent to high winds.
Willows (Salix). None of the willows which grow to tree
size in Ontario are of any special cornmercial im-
portance. The kinds referred to in this report are
shrub-like and may for the most part be considered as
worthless weeds, their only useful function being that
they provide ground cover. They often grow on
land of low quality.
Woodlot. A relatively small wooded area most often
associated with farms. Woodlots act as a source of
fuel, posts, etc., for the farm and as a source of cash
income from the sale of logs and pulpwood. In the
aggregate their importance to the community is very
great, quite apart from their commercial value, in that
they help conserve soil moisture, provide a habitat for
game and birds, retard water-run-off (and so help
prevent floods) and reduce erosion by wind and water.
Woodpiilp. Wood fibres separated by mechanical or
chemical means and used for manufacturing papers,
textiles, and many other products based on the use of
cellulose.
Working plan. A long-term plan for the scientific and
businesslike management of a forest area with the aim
of getting the greatest annual crop of wood economically
feasible in perpetuity.
Yarding area. A wintering ground selected by some wild
animals, such as deer and moose, for reasons of food
supplies and in which during deep snow the animals
can move relatively freely along well trampled paths to
feeding areas.
Yellow birch. See Birch.
20
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