March 22, 1938

LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE (Quebec East):

Upon giving notice, because of course private interests may be affected, and it is only fair that notice should be given.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

There is no objection to that.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE (Quebec East):

But if a repeal is being made because of the failure of the grantees to act according to the provisions of the bill, then it will be without notice- namely, if it exports power which is not surplus power, or if it charges a lower price in a foreign country than is charged to a Canadian consumer.

Perhaps I should read subsection (c) again:

The said private act may be repealed by proclamation of the governor in council at any time upon such notice as the governor in

Electric Power Export

council shall prescribe, or, if the governor in council is satisfied that the conditions imposed by paragraph (a) or (b) -

That is, the surplus of power and the price to be charged-

-of this subsection are not being complied with, without notice.

As it is, we leave to parliament the discretion as to the number of years during which the bill will be in force.

Then we considered another alternative, which would have been adding another paragraph, namely paragraph (d), in these words:

Subject to the provisions of paragraph (c) in this subsection-

The one I have just read-

-the said private act shall remain in force for a period of five years from the date of the commencement thereof.

This would have fixed the time limit. After five years the law would have disappeared altogether. Then we considered another alternative, the one which my right hon. friend opposite seems to favour-if I may have his attention.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

I am listening carefully.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE (Quebec East):

It would be paragraph (d) and in these words:

Subject to the provisions of paragraph (c) of this subsection the said private act shall remain in force for a period of one year from the date of the commencement thereof, but may be extended from year to year by proclamation of the governor in council for four yearly periods of one year each, but not so that the said act shall in any case remain in force for more than five years from the date of the commencement thereof.

There again it would be limited to five years, renewable by proclamation every year.

But as I have said, this is rather a question of policy. I must say-and I think I am right in saying this-that the government is not linked with any one of those methods, and if the committee favours the suggestion of my right hon. friend opposite I think we would be quite willing to require the new proclamation every year to keep the act in force for a certain number of years.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

The white book indicates that in 1907 licences were issued to the Canadian Niagara Power Company of Niagara Falls, Ontario. It is stated that the transmission line crosses the boundary at or near Fort Erie and Niagara Falls, Ontario, the licence for firm power starting in 1908 with 39,165 kilowatts and rising to 45,000 kilowatts in 1938. Then there is a note which says:

These companies were under the control of the electric power controller for these years, and licences were not issued by this department. The amounts shown are those recommended by the power controller.

Then for the same company, and with the same statement as to transmission line, dealing with surplus returnable on demand, the licence was issued in 1925, eighteen years later, and began to operate in 1926 with 20,000 kilowatts.

Then we turn to page 98, and we find mention of the Ontario Power Company of Niagara Falls, Ontario. It is stated that the transmission line crossed the boundary at or near Niagara Falls, Ontario. The date of the original licence was November 9, 1907. That was for firm power, beginning with 45,000 kilowatts, and is still for that amount, although at one time it rose to 60,000 kilowatts, and then fell to 37,300 kilowatts in two years. Note (a) is as follows:

This company was under the control of the electric power controller for these years and licence was not issued by this department.

That was during the period of the war, in the years 1918 and 1919. Then, note (b) states:

The Electrical Development Company and The Ontario Power Company were purchased by the Hydro-Electric Power Commission, and a licence equal to the sum of the licences of these two companies was obtained by the Hydro-Electric Power Commission.

That is one for 80,000 kilowatts, the first licence having been issued in 1925. It has now, in 1938, fallen to 45,000 kilowatts, and the Hydro-Electric Power Commission of Ontario, at another spot near Queenston, has the right this year to export 80,000 kilowatts.

These are the two relevant licences in the province of Ontario. Of course, there is a licence in New Brunswick for 2,500 kilowatts; there is another one for 2,500 kilowatts, and there is one in Ontario, at Fort Frances, for 5,500 kilowatts. The point I should like to make is that under the terms of licences the hydro commission now has, it can export its power only for one year, the licence expiring on the 31st day of March in each year. There is no right of renewal, qua right, but it is renewed if the power is not required, and the company has conformed to all the requirements of the department.

Now comes the next point: If you grant a licence for five years, not stating how to divide it up, you have created a vested right, unless you add another paragraph, such as I suggested the other day, that no renewal of licence or any other act shall create a vested interest under this act. That, I believe, is important in view of what was said-and even

Electric Power Export

in the dispatch which we had yesterday, there was the same thing. What are the grounds upon which the Secretary of State of the United States has placed his refusal? He says: "We do not desire to import power into the United States". First of all he refers to the protection of his power market. That is number one. Then, as number two, he refers to the undesirability of importing power from a foreign country, and thirdly, he casually mentioned the question of defence. On those three grounds the matter is put, and the opinion of Attorney General McReynolds is used as a basis, since the repeal of the Burton Act.

Now we are going to have the same hydroelectric commission apply for a private act in this parliament?-for they are the only applicants at the present time for the export of power. That private act may contain a provision for a term of years. But the licences they will have at Queenston and Niagara Falls will expire on the 31st day of March in each year, so that no vested right can arise, we have made it so clear as to be beyond the possibility of doubt. If, however, we pursue the course suggested in connection with a private act, what we have done-whatever language we may use, if we use a term of years at all, unless we negative it by express language-is to create a vested right.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE (Quebec East):

In favour of whom?

Topic:   ELECTRIC POWER
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

In favour of the hydroelectric commission.

Topic:   ELECTRIC POWER
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LIB

William Daum Euler (Minister of Trade and Commerce)

Liberal

Mr. EULER:

We reserve the right to

cancel at the end of another year.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

The Minister of Trade and Commerce (Mr. Euler) grasps at once the point I am desiring to make, that is, that the licence has to be uniform. The private act, which is a licence, should conform, so far as uniformity is concerned, to the licence which is being maintained by this statute. Remember, this statute maintains the licence feature. There must be no misunderstanding about that. The language of the section was redrawn the other evening to make it clearer. At Queenston there is the question of 80,000 kilowatts and at Niagara Falls, 45,000 kilowatts; in both cases the licences expire on March 31 of each year. But you have another licence in the form of a private act, so called, which authorizes the export, we will say for the sake of argument, of 50,000 kilowatts over a period of years. That is a creation of a vested right. In order that there may be uniformity we should see that the right to export power under this private act shall expire on March

31 in each year, but may be renewed, by the governor in council if you like, from year to year, just as the main act now says with respect to Queenston and Niagara Falls power.

We would thus have uniformity at Fort Frances, in Maine, at Niagara Falls and at Kingston. All would be in the same position. We now have the anomaly of having a private act authorizing for a period the export of power from this country without having the safeguards that are established by the general statute. I am not saying this in any captious sense, because so far as I am concerned the matter is of complete indifference. I am putting it forward in the public interest. There should be uniformity, and the Minister of Justice has indicated that two or three alternatives were considered. All I suggest is that you combine the three of them. First, you would provide for no period at all. The private act should make it clear that no period is being contemplated, the same as is now the case with Niagara Falls power. Remember we are dealing with exactly the same people. The only applicants we have before us are those who have the licence for the power at Queenston and Niagara Falls. Let us give them their licences in the same terms. They have not complained; they have been satisfied,

Then there are the two provisions that have been added, namely, one with respect to surplus power and price, which I think is admirable, and one with respect to the right to repeal the statute by proclamation. That is such a vast extension of the power of the governor in council that I could hardly see my learned and right hon. friend, the Minister of Justice, make the statement without choking, having regard to his attitude in times past with respect to the abuse of power by the governor in council.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE (Quebec East):

We have it already.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

It was against that that the Prime Minister the other day quoted the authqrity of Sir Robert Borden and others to the effect that it was a terrible thing to contemplate the possibility of the governor in council doing it.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE (Quebec East):

We have too much power now.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

We are suggesting that

it might be dealt with in this way. In any system of responsible government some power must be given to the executive to deal with certain phases of the matter. I think you could meet the situation with a combination of the three. First, provide that any

Electric Power Export

authority to export power under any private act shall expire on March 31 in each year. Second, such right may be renewed from year to year, just as we have it in the principal statute. Third, nothing in this contained shall confer any right. All these the minister has in his mind in the provisions he has added. There is not one suggestion not contained in the combination of his three. If you combine the three of them, everything is there. Possibly I am a little stronger on the question of the acquisition of a vested right and the exact language, but if you combine the three I submit you have everything. It is in the public interest to maintain uniformity in all grants to export, whether they be for the company at Queenston, which is the same company, or the one at Niagara Falls or here.

That is the point I desired to make. I do not know whether I have made it plain, but I wanted to clear up beyond any per-adventure the statement to which reference was made the other evening, that the Canadian Power Company statute does confer any right to export. On the contrary, it does not. What is more, they had to take out a licence and they have taken out a licence. The statute changing the name to the Ontario Power Company was chapter 105 of 1899, and that company was acquired by the hydro electric commission. The commission has taken out a licence from year to year. That is all I desire to say. Perhaps I could crystallize it into a really clear statement, but I think the point is quite apparent to the Minister of Justice.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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CON

Hugh Alexander Stewart

Conservative (1867-1942)

Mr. STEWART:

The record shows clearly that notwithstanding the fact that licences have been issued annually, and that they contain restrictions and provisions for cancellation, after having been in force for years, there has grown up in the United States the contention, notwithstanding all this, that vested rights may be acquired. If we pass an act of parliament and say that power may be exported for five years instead of one, surely we will be giving that contention just five times the weight which it has under the existing statute. That is the serious matter in this whole proposition. We should guard in every way against the possibility of the contention arising that there is a vested right. This should be done to prevent any international difficulty. It does seem to me that uniformity should exist in connection with these licences, and the course outlined by my leader provides for this. It would not require much change in the drafting of the amendment to secure this result, and I think it is most desirable.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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LIB

Arthur Graeme Slaght

Liberal

Mr. SLAGHT:

Mr. Chairman, I should like to discuss the provisions of this section very shortly before it is passed and call to the attention of the committee some matters which I think will -be helpful in determining in just what way we should leave section 4, when viewed in the light of the amendments and the original draft.

Hon. members will recall that the section provides, first, that in future power exportation can be had only by an applicant coming to parliament with a private bill instead of as heretofore; second, that there must accompany the application an order in council from the exporting province-in the case of the hydro commission it would be Ontario-and where the power is generated wholly or in part in another province, there shall be also an order in council from the generating province. It is the intention of this amendment, I think quite properly, to see to it that both such provinces shall first express their approval of authorization to any private person, corporation or public utility to export power. I desire to align myself with the idea put forward by the leader of the opposition, (Mr. Bennett) namely, that we should provide if possible that, once by private act parliament has authorized a new and further export of power, thereafter there should be power by annual licence to continue and renew the export which parliament has once approved. It would be folly to ask any proposed exporter to come back year by year to parliament for a private bill to continue exportation. The proposed amendment sees fit to preserve by order in council the right to renew all existing licences. I venture to suggest that the existing licences when originally issued were not examined as to their possibilities for good or evil with anything like the pains that any application for a right to export power, coming forward by way of private bill, would now receive. As I understood the suggestion of the leader of the opposition, it was that after parliament had warranted an exportation, and only for one year, thereafter such exportation shall be in the same plight as the licences at present existing.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

That is my suggestion.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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LIB

Arthur Graeme Slaght

Liberal

Mr. SLAGHT:

Personally I am fully in accord with that.

In view of the communications received yesterday and the great bearing they have on the matter before the house it is necessary to look a little more closely into the provisions of section 4. The views of the president of the United States on a subject of international importance such as the export of power should

Electric Power Export

receive from us in this parliament the utmost consideration and respect. To my mind we should so treat the position that he takes- knowing, as he says, that in the form of the bill now before us the matter was under consideration by this parliament, which means that he has undoubtedly studied or had reported to him the purport of our bill and the debate which has taken place in the last two weeks, with the observations of the learned gentleman opposite, as to which I shall have a word to say in a moment. Having confided to us his reasons of state for indicating that he would not permit the importation of power regardless of whether we in this country authorized its export, I say that those observations and those reasons must receive the utmost consideration from this parliament.

May I be permitted a personal word which, I believe, has a bearing and will assist in the solution of the problem as to what we should do with section 4 and the appropriate other sections that follow? It is this. The president of the United States, and the secretary of state, Mr. Cordell Hull, who join in the communications received and tabled last night, are in my humble opinion the best friends that Canada has in the United States of America. I believe the history of the last six months has shown to anyone who has followed it that their policy of the good neighbour and of good-will towards this country-and I will not pause here to review the various incidents, such as the visit of Lord Tweedsmuir to Washington, the visit of Mr. Cordell Hull to Ottawa and Toronto, the Chicago speech of the president, and all the history of the last six months, in which the Prime Minister of Canada has played no unimportant part-these things have done more to cement in this critical time the friendly relationships between Great Britain and the commonwealth of nations in the British Empire and the Unites States of America than any series of incidents since confederation. That perhaps is an added reason why we should deal most carefully with legislation for the export of power.

Since the first application early in January by the hydro commission of Ontario, backed as it was by the premier of Ontario, for leave to export power, there has been a deliberate and organized effort by the Conservative party of Ontario and the Conservative federal party to kill the application. Why do I make that observation? An hon. member suggests that he is of easy mind now; the matter has no significance, and so on. But the hon. member for Dufferin-Simcoe (Mr. Rowe), who I am very sorry to observe is not here

to-day, and who is the remote-control and absentee-leader of the Ontario Conservative party, opened the attack upon the hydro application for the export of power in a speech which he made to the Parkdale Women's Conservative Association in Toronto on the evening of January 19 last, some two months ago. He vigorously denounced the hydro application which had been lately made for the export of power, and gave reasons for his opposition; and he has been consistent in his denunciation ever since. Whether the ladies of the Parkdale Women's Conservative Association fully appreciated the effect of his denunciation it is not for me to suggest.

Then we have the leader of the opposition making, in his speech several weeks ago on the address in reply, another bitter and perhaps back-handed attack upon the export of surplus power by the hydro commission. The absentee leader of the Ontario party, the hon. member for Dufferin-Simcoe, followed it up in a speech in Lambton during the present by-election, on March 7. If he is correctly reported, he again condemned hydro in their application for the export of power and made certain very choice and delicate observations with regard to the premier of Ontario and his entire cabinet because they favoured the export of power. Hon. members had the opportunity of listening the other day to a very refined and eloquent speech by the hon. member for Dufferin-Simcoe. It was something like the Lambton speech but not quite so loose-tongued as his platform utterances, because, if correctly reported, in his Petrolia speech of March 7 he said of the Ontario general election last October 6:

I have lost too many heats in horse races to make apologies. We did not have speed enough to keep up with that caravan of racketeers, but there is another day coming.

In other words, the premier of Ontario, who dared to export 110,000 horsepower of surplus power, power that would otherwise run over the dam, is the leader and head of a caravan . of racketeers. I am afraid the hon. gentleman forgets that very recently the people of the province had an opportunity to choose between his distinguished self and him whom he indicts as the head of a caravan of racketeers-and they chose the latter by an overwhelming majority. However, I must not get away from my subject.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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UFOL

Agnes Campbell Macphail

United Farmers of Ontario-Labour

Miss MACPHAIL:

Electors sometimes

make mistakes.

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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LIB

Arthur Graeme Slaght

Liberal

Mr. SLAGHT:

The bon. member is quite right; I believe the electors made a great mistake in 1930, for instance, if the hon. member will cast her mind back to that year.

Electric Power Export

But let me continue. After we had this, as I term it, deliberate cabal between the party in Ontario or the remnants of it and the gallant little band of thirty-eight comprising the federal Conservative party, what further evidence is there that they made up their minds to kill the application of -the hydro from Ontario?

Topic:   ELECTRIC POWER
Subtopic:   TRANSFEB TO PARLIAMENT OF CONTROL OF EXPORT EXCEPT IN INTERNATIONAL EMERGENCY
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March 22, 1938