November 14, 1957

GOVERNMENT POLICY RESPECTING NATIONAL DEVELOPMENT

PC

John George Diefenbaker (Prime Minister)

Progressive Conservative

Right Hon. J. G. Diefenbaker (Prime Minister):

Power Development

interconnection lines at the borrowing cost of the federal government will in itself reduce the cost of power in these provinces. However, it is apparent that the reduction achieved through lower financing costs will not reduce the cost of power for industry to the extent necessary to put the two provinces on a comparable basis with more favoured provinces in our country. Notwithstanding the availability of substantial supplies of coal in Nova Scotia and New Brunswick, the situation at the present time is that coal for power in the maritime provinces costs more than coal brought in from the United States for the production of power in Ontario.

While central Canada has, of course, advantages in addition to this one in attracting industry, it has seemed to the government that if the maritime provinces are to be given a fair opportunity to attract industrial growth they must be able to secure coal for the production of power for industrial use at a price that does not exceed the price of United States coal in central Canada. The government has therefore decided that it will provide a subvention on coal used for the production of power in the provinces of New Brunswick and Nova Scotia to the extent that is necessary to equalize the cost of that coal with the cost of coal used for the same purposes in Ontario.

I need not emphasize that the subvention on coal will have a double value. It will reduce the cost of the power that is produced from the coal, and that will help greatly. It will also do much to ensure that the coal produced in the maritime provinces continues to be used for the growing power demand of those two provinces and will not be replaced by oil brought in from foreign fields.

This program, I may add, carries the full and enthusiastic support of the premiers of Nova Scotia and New Brunswick and will, I believe, have a lasting and beneficial effect on the economic growth and welfare of the Atlantic region.

Mr. M. J. Cold well (Roseiown-Biggar): Mr. Speaker, may I ask the Prime Minister one question following his important and I think interesting announcement this morning, which I hope will benefit the maritime provinces. Will he discuss with the province of Saskatchewan in connection with the South Saskatchewan power project similar assistance in the financing of that project? I understand this would help to lower the cost of financing.

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PC

John George Diefenbaker (Prime Minister)

Progressive Conservative

Mr. Diefenbaker:

Mr. Speaker, a meeting has been arranged with the premier of Saskatchewan and other representatives imme-fliately following the dominion-provincial

conference, and I may add that the basic concept and the spirit of this policy will apply wherever a case by a provincial government is made out.

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LIB

Louis Stephen St-Laurent (Leader of the Official Opposition)

Liberal

Right Hon. L. S. St. Laurent (Leader of the Opposition):

May I put just one question, Mr. Speaker. I am sure everyone will rejoice to find that the project which had been suggested well over a year ago now, that there might be established power plants that would be turned over at cost-or in that project it was suggested that it was the output which should be turned over at cost-to the provinces, with an integrated distribution system for the two provinces of Nova Scotia and New Brunswick, is now going to be realized, though the present government has found it necessary, in order to make it possible to produce power which would be competitive with that available even from fuel in central Canada, to provide a subsidy on the coal so used. That would probably have the double-barrelled effect of aiding the coal industry as well as providing more attractive power for industrial purposes. In connection with the whole matter, now that the arrangements have been concluded, is there still any objection by the government to producing the report of the Montreal Engineering Company, which had been asked to study and report on the whole situation?

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PC

John George Diefenbaker (Prime Minister)

Progressive Conservative

Mr. Diefenbaker:

Mr. Speaker, I thank the right hon. gentleman for his observation and for having distinguished between the plan we produced and the one we believed to be impractical and which was placed before the people during the election by the former government. As far as the question of the right hon. gentleman is concerned, I think the Minister of Northern Affairs and National Resources is in a position to answer it.

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?

An hon. Member:

A distinction is not a difference.

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PC

Francis Alvin George Hamilton (Minister of Northern Affairs and National Resources)

Progressive Conservative

Hon. Alvin Hamillon (Minister of Northern Affairs and National Resources):

Mr. Speaker, I am pleased to table the report by the Montreal Engineering Company in regard to the requirements for power plants and transmission lines in Nova Scotia and New Brunswick.

In doing so I should like to make it clear that the report is in the nature of professional engineering advice on a specific range of problems. In providing such advice, which I think has been very competently given, the engineers of the company had to examine to some extent or make assumptions on certain matters not strictly of an engineering character. In relation to these there can well be differences of view, without affecting the

accuracy of the technical advice. Unless this is understood there could be misinterpretation of some aspects of the report.

For instance, the Montreal Engineering Company projection of future demands excludes future requirements of pulp and paper companies and any demands which might be created by a large electro-smelting operation. This does not mean that the Montreal Engineering Company or any government is of the view that these developments will not come about. It is rather because if one had to make a firm determination by August, 1957, of the future demands, it was logical to predict industrial demands, as is done by commercial enterprises, only when a firm contract is placed.

Also included in the report is an assessment of coal reserves in certain maritime areas. This is a matter on which there is a good deal of difference of view, even, I believe, among competent engineers. The government does not necessarily subscribe to the assessment made in particular cases.

It was the view of the two provincial governments that it would be best to conclude the arrangements the Prime Minister has just announced before tabling this report. It was as a courtesy to the provinces, therefore, that it has not been tabled before this.

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LIB

George Carlyle Marler

Liberal

Hon. George C. Marler (St. Anloine-West-mount):

May I ask the minister a question with regard to the report he has just tabled. Are we to understand from his statement that the government disassociates itself from the recommendations of the report?

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PC

Francis Alvin George Hamilton (Minister of Northern Affairs and National Resources)

Progressive Conservative

Mr. Hamilton (Qu'Appelle):

My statement was absolutely clear on that point.

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LIB

John Whitney Pickersgill

Liberal

Hon. J. W. Pickersgill (Bonavisia-Twillin-gate):

Mr. Speaker, I wonder if I might ask the Prime Minister whether the government has initiated any conversations with the governments of the other two Atlantic provinces with a view to the extension of those policies which we all welcome-at least the policy regarding the thermal plants-to those other two provinces.

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PC

John George Diefenbaker (Prime Minister)

Progressive Conservative

Mr. Diefenbaker:

Mr. Speaker, as I pointed out at the conclusion of my statement, we were approached by the two provinces in question, and it was with respect to those two provinces that the statement was made by the government. Any other provincial government which chooses to make representations will receive the consideration which the case it makes out deserves.

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LIB

John Whitney Pickersgill

Liberal

Mr. Pickersgill:

A supplementary question, Mr. Speaker. Do I understand, then, that the federal government intends to take no initiative in this matter?

Power Development

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PC

John George Diefenbaker (Prime Minister)

Progressive Conservative

Mr. Diefenbaker:

Mr. Speaker, after all, each of the provinces has to determine whether or not it desires to make any application to the federal government under this policy. It is not for us to press upon any province a policy which, in its way, is peculiarly a matter of provincial responsibility.

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LIB

Jean Lesage

Liberal

Hon. Jean Lesage (Monimagny-L'Islet):

question on the same subject, Mr. Speaker. May I ask the Prime Minister what will be the role of the northern Canada power commission in the implementation of the policy he has just announced?

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PC

John George Diefenbaker (Prime Minister)

Progressive Conservative

Mr. Diefenbaker:

Mr. Speaker, when the matter is brought up for implementation through legislation a very full statement in that connection will be made. The role of the crown company in question will be such as may be necessary in the implementation of the general plan.

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LIB

Jean Lesage

Liberal

Mr. Lesage:

Mr. Speaker, may I ask the Minister of Northern Affairs and National Resources if an agreement has been reached with the premiers of Nova Scotia and New Brunswick as to the location of the first thermal plants to be built under the agreements which were announced by the Prime Minister?

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PC

Francis Alvin George Hamilton (Minister of Northern Affairs and National Resources)

Progressive Conservative

Mr. Hamilton (Qu'Appelle):

Mr. Speaker, the present state of negotiations among the governments concerned is that the general principles have been arrived at as announced by the Prime Minister, but I do understand that the location of the first plant has been agreed upon.

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LIB

Jean Lesage

Liberal

Mr. Lesage:

As to this agreement on principles, which has been reached by the Prime Minister and the premiers, is there anything in writing or any exchange of correspondence confirming the agreement?

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PC

Francis Alvin George Hamilton (Minister of Northern Affairs and National Resources)

Progressive Conservative

Mr. Hamilton (Qu'Appelle):

Mr. Speaker,

I think I can handle that question. The agreement is now presently being worked upon by the officials of the governments of the provinces of New Brunswick and Nova Scotia and the federal government. As a matter of fact I think they are meeting in Ottawa today.

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LIB

Jean Lesage

Liberal

Mr. Lesage:

Is it the intention of the government to table that agreement when it is completed?

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November 14, 1957