May 26, 1966

LIB

Lucien Lamoureux (Speaker of the House of Commons)

Liberal

Mr. Speaker:

I regret I must interrupt the hon. member but the time allotted for the consideration of private members' business has now expired. The house will now resume the business which was interrupted at six o'clock.

Topic:   MOTIONS FOR PAPERS
Subtopic:   ALBERTA ELECTORAL BOUNDARIES COMMISSION
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TRANSPORT

SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26


The house resumed consideration of the motion (Mr. Cantelon) for the adjournment of the house under standing order 26.


NDP

Thomas Clement (Tommy) Douglas

New Democratic Party

Mr. Douglas:

Mr. Speaker, in my opinion the hon. member for Kindersley (Mr. Cantelon) has rendered a valuable service in moving the adjournment of the house to discuss the question of higher tolls on the St. Lawrence seaway and the imposition of lockage fees on the Welland canal.

[DOT] (7:00 p.m.)

Let us make no mistake about this, there are great numbers of people in Canada who

[Mr. Mackasey.l

will be affected by any action taken as a result of the hearings held during the past few days in Ottawa by the seaway authority. I had hoped that a spokesman for the government would outline what the government's policy is with respect to tolls on the seaway and would have told the people of Canada and this house what it intends to do to cope with the problem of rising costs, and what it proposes to do to make it unnecessary to increase further the tolls on Canada's great inland waterway. Instead of that all we got from the Acting Minister of Transport (Mr. Turner) was a counsel of despair.

His argument was a weird and wonderful one. He told the house that under section 16 of the St. Lawrence Seaway Authority Act the authority was required by law to increase its tolls in order to be able to meet its obligations, and that the obligations set out in section 16 are that it must meet its payments with respect to operating costs, it must meet its amortization payments, and also meet the costs of interest and servicing for outstanding debt.

If that is the sum total of the government's case, and if the seaway authority has no option to do other than to increase its toll rates because of the fact that its costs have gone up, then I would like to ask why the seaway authority is holding hearings. Surely these hearings are a farce? If the minister is right, that the authority has no choice other than to impose increased tolls because of increased costs, then why the hearings? Also why is this matter then referred by the seaway authority to the governor in council, for if the statute requires the rates to be increased because of rising costs, then automatically the cabinet has no choice but to approve those increases.

Therefore we are simply going through a hypocritical farce in talking about public hearings and in having the government say that this matter is not decided because it has to come before the Privy Council. My contention, of course, is that the acting minister has overlooked section 15 of the act, because that section says that the authority may-

-subject to sections 16 and 17, establish tariffs of tolls to be charged by it with respect to-

And it sets out the basis on which these tolls may be charged. Subsection (2) says:

The tolls that may be charged by the authority pursuant to this section may be for the use of the canals and works administered by it-

And so on.

May 26, 1966

I maintain that section 15 gives the authority to the seaway to charge tolls but does not require it to charge tolls, and if the government decided not to apply tolls it has the authority under the act to do that. It is true that in section 17 there is a provision that the question of tolls is subject to any agreement with the United States. It is true that there is an agreement into which Canada has entered, requiring the charging of tolls; but this is an international agreement which is subject to renegotiation.

International agreements have previously been renegotiated. I submit that this international agreement can be renegotiated now and the government, if it wants to, has the power, subject to the renegotiation of the agreement with the United States, to change the basis entirely so that we could have toll-free service on the seaway, or some modified form of tolls that would cover only part of the cost. That of course would require amending section 16.

The most disappointing thing about this whole debate is that while hon. members, particularly backbenchers in all parties, have expressed their opposition to increasing the tolls on the seaway, the government has not come forth with some clear statement of policy, because this matter of the tolls on the seaway is much larger than the immediate issue before the house. It has to do with the entire concept of transportation. It calls for a clearly defined transportation policy on the part of the government, but the fact is that the government has not got a clearly defined and clearly stated transportation policy.

Someone has said that the history of Canada is a long and constant struggle with geography. Long before confederation our forefathers struggled with the problems of a young country, a population strung along the international boundary of the United States for a length of 4,000 miles, sparsely settled people who had two major problems, one, how to get their products to the world markets at prices that would be competitive and, two, how to bring in the commodities which they could not produce themselves at a figure that would enable them to be competitive and to maintain a decent standard of living.

Consequently transportation has been at the heart of almost every great parliamentary debate since confederation. It was early recognized that we had to decide in Canada whether the entire cost of transportation was to be borne by the users or whether, as a matter of national policy, some part of it

23033-354i

Seaway and Canal Tolls should be borne by the country as a whole. This is why until recently, for over 60 years it has been a matter of government policy that our canals and waterways should be toll free.

As early as 1903 Hon. W. S. Fielding, who was himself a maritimer and a minister of finance in the Laurier government, said in the House of Commons:

There Is room for some doubt whether the tolls that are charged are large enough to be a serious obstacle to traffic. But while this doubt exists, we do not feel that they are such as would prevent us giving the proposal to abolish them a fair trial. The revenue, though considerable, is not large enough to prove a disturbing factor. We would gladly yield up this item of our receipts if we could feel assured that it would have the great effect of encouraging business. The government have therefore determined for a period of two years to suspend the charges for tolls and make the entire canal system of Canada absolutely free to all.

That policy was continued over a long period of years.

In 1934 Hon. R. J. Manion, who was minister of railways and canals in the Bennett government, said this:

I entirely agree with those from the west who say that the western Canadian grain grower cannot stand (the proposed toll) added to his present cost. It is important that we should have the lowest possible rates in order that we may compete with countries whose grain fields are closer to the seaboards than are the fields of Canada.

[DOT] (7:10 p.m.)

Interestingly enough the head of the government of that day, Right Hon. R. B. Bennett, in the same year said in the House of Commons:

The reason the government of Sir Wilfrid Laurier removed the tolls in 1904 was that they imposed an additional burden upon the grain growers of the west: that is the real reason . . . The real reason for this arrangement, one which some people thought was misunderstood philanthropy, was really an effort on our part to lessen the charges on the movement of wheat from Fort William and Port Arthur to Montreal, destined for export to the markets of the world.

So, for a long period of time traffic on the canals and waterways of Canada was toll free in recognition of the fact that our primary producers, who have been buying in a protected and costly market, might have the lowest possible transportation costs in order to get their goods to market at competitive prices and in order to give them a fair return for their produce.

We all know of the long and bitter opposition in the United States to the construction of the St. Lawrence seaway. It was opposed

May 26, 1966

Seaway and Canal Tolls by powerful interests in the United States, for long periods of years. It was only when the government of Right Hon. Mr. St. Laurent threatened to go it alone, and to have Canada assume the entire cost of building this great inland waterway, that President Eisenhower agreed to participate and the United States and Canada began this great project. When that project was nearing completion, and when it was suggested there should be tolls upon it, submissions were made from all over Canada asking that the policy of toll-free waterways be continued. In 1958 the government of Saskatchewan made a submission to the government of the day, headed by the present Leader of the Opposition (Mr. Diefenbaker). I have in my hand a copy of that submission, of which I think this paragraph sums up the case:

The fact that economic development in Canada could proceed only as fast as provision was made for adequate transportation facilities has always been apparent. Canadian statesmen for more than a century have realized that because of the great distances and sparse population of the dominion, the resources of the state would have to be thrown into the task of assuring essential transportation improvements either directly by way of unremunerative state enterprise or in subsidies to private enterprise. This has been true of all transportation facilities whether roads, railways, river improvements or airlines.

May I just pause to point out that this statement can be documented with comparative ease. The taxpayers of Canada have subsidized every form of transportation, whether it be the publicly owned Canadian National Railways which has been subsidized by the taxpayers in order to provide transportation facilities to the people of the outlying areas of this country, whether it be the large sums of money and land grants which were given to the Canadian Pacific Railway, or whether it be the subsidization of air transportation in the form of many, many millions of dollars which have been put up by the taxpayers to build terminal facilities, airports, and airstrip facilities, or whether it be the large sums of money spent by both federal and provincial governments for the construction of highways for motor and automobile transportation.

No one can quarrel with a policy which recognizes that Canada's greatest problem is geography. If we are to get our goods to market at competitive prices, if we are to handle the transportation of a lot of our own goods in Canada rather than have them go through United States ports, it is necessary to subsidize much of our transportation. If

this can be done, it should be done as a matter of national policy and not on a hit and miss haphazard basis.

The brief to which I just referred, which was presented by the government of Saskatchewan to the prime minister and cabinet in 1958, concluded its remarks by saying this:

The Government of Saskatchewan looks at the whole question of tolls in the light of these facts and in constant awareness of certain conditions which must continue to be of vital importance to the welfare of the province. Among the latter the most prominent and persistent are the inescapable dependence of Saskatchewan on overseas markets for wheat, the intensity of competition which characterizes these markets, the distance of Canadian producers from consuming centres, and the consequent handicap of heavy transportation costs which must be borne by our wheat. The savings in transportation costs which may result from the seaway improvements are, as yet, uncertain, unproved, and theoretical.

On the other hand, tolls will increase shipping costs by their full amount above the level which would be possible if tolls were not imposed. The resulting burden to the prairie producer will be certain, immediate, and real.

I can only regret, of course, that our plea in 1958 to have the St. Lawrence seaway made a toll free waterway was not acceded to, and that the agreement entered into with the United States required the collection of tolls, because the same powerful interests in the United States who had for decades opposed the construction of the St. Lawrence seaway then had moved to a second line of defence and demanded tolls which would cover not only the operating costs of the seaway, not only the servicing of the debt, but the amortization of that debt over a period of time which was the shortest period of time ever undertaken for any project of this kind anywhere in the world.

Even with the tolls, the farmers of western Canada, as a result of the St. Lawrence seaway being constructed, gained. Prior to the seaway being opened the cost of a ton of grain moving from the head of the lakes to the seaport was $5.33 a ton or 16 cents a bushel. When the seaway came into operation, even with the tolls, the cost was reduced to $4.43 a ton, a saving of 90 cents, and the cost per bushel was reduced to 13 cents, a saving of 3 cents per bushel. That meant a great deal to the farmers of western Canada, and particularly that part of Canada where their grain moves eastward rather than to the Pacific coast.

[DOT] (7:20 p.m.)

If the proposal which the seaway authority has made that the rates now be increased by

May 26. 1966

10 per cent is allowed to stand, then this will mean, as Mr. Charles Gibbings, president of the Saskatchewan Wheat Pool has stated, an increase in the shipping costs to the prairie farmer of roughly 1|- cents per bushel. I do not need to detain the house by elaborating on the predicament in which the prairie farmer has been since 1951 when his costs have steadily mounted, whereas the general price index for the things he has to sell have remained more or less stationary. The farmer has been caught in a cost-price squeeze. His net income in relation to other economic groups in the community has not advanced. He has been caught in a cost-price squeeze and that squeeze will be further accentuated if the cost of shipping his grain to seaboard through the St. Lawrence seaway is increased by another 1J cents per bushel.

It is not only the western farmers who will be affected. This increase will affect industry in central Canada. As my colleague, the hon. member for Skeena (Mr. Howard), pointed out this afternoon, on the basis of information and research which has come to our attention there are about one million tons of iron ore with regard to which the cost of shipment is so close that any increase in the tolls on the St. Lawrence seaway could divert these one million tons of iron ore to United States ports on the Atlantic. The result would be that a good deal of business would be lost to the industries in central Canada and there would be a loss of job opportunities to Canadian workers.

Of necessity, since the traffic on the St. Lawrence seaway is a two-way proposition, the price of goods coming into the country, raw materials for industry and consumer goods, will go up. All this is bound to start another round of rising costs. We have all been deluged, I am sure, with the constant complaints of people in this country who find their living costs going up much more rapidly than their income. This means that their standard of living is being reduced. We have been trying to get the government to concern itself with this problem. Even if they are not going to tackle the problem of prices, they could at least alert themselves to what will happen if the tolls on the seaway are increased and living costs in this country go up further.

The cost of living has gone up by over 4 per cent in the last 12 months, and the Minister of Finance (Mr. Sharp) in his budget estimated it will go up at least another 3.5 per cent this year. My own opinion is that it will be more. All this sets in motion labour

Seaway and Canal Tolls disputes and strikes, because wages inevitably lag behind the rising cost of living. The government here faces a very critical situation and one would expect they would have something more constructive to offer than what was presented to us this afternoon, when a minister merely told the house that under section 16 of the act the seaway authority has no choice but to raise the rates if their costs have gone up. I presume from this that the cabinet will have no choice but to approve that increase since they, of course, would not want to run counter to section 16 of the act.

There is another aspect of this problem, and that is the effect which increased tolls will have on the seaway itself. The seaway is not yet operating at full capacity. Some experts have said it will probably be 1980 or 1982 before it will reach the full capacity of ships which it can handle. Everyone knows of course that it is only when you have a project operating at full capacity that you get your per unit costs down and operate efficiently at the lowest possible cost. If tolls are increased, surely the tendency will be to reduce the traffic, or at least to prevent the traffic on the seaway increasing as rapidly as it would otherwise do; and it may well be that by raising the tolls 10 per cent the gross return to the seaway authority may not be any greater than if it had left them where they are now.

Therefore I think that the economic implications of the action being proposed by the seaway authority are so far-reaching that the government has to do a great deal more than anything they have indicated they are willing to do at the present time. As a long term view, of course, I think they ought to renegotiate the agreement with the United States and move steadily toward eliminating the tolls entirely. As a start they might base the tolls on the operating costs of the seaway and let the Canadian people as a whole assume responsibility for the outstanding debt and the servicing of that debt. But I recognize that this will take some time, and I do not expect the government to announce that it is going to start that tomorrow morning; I have never been alarmed about their showing too much haste on any critical matter.

However, I want to reiterate what we are asking for now. A few days ago on the orders of the day I asked the Minister of Transport (Mr. Pickersgill) if he would assure the house that when the seaway authority made its

5576 COMMONS

Seaway and Canal Tolls recommendations to the government the latter would provide an opportunity for debate in this house before any decision was made by the cabinet with respect to increasing tolls. I was told by the minister that this was a hypothetical question. Of course, it is not a hypothetical question at all. Unless we receive some assurances from the government today or within the next few days, the following will be the course of events. The seaway authority completed its hearings this afternoon. It has already stated publicly that its increased costs make a 10 per cent increase in tolls mandatory. Therefore there can be little doubt about what it is going to recommend to the cabinet; and if one may judge from the statement made by the Acting Minister of Transport (Mr. Turner) this afternoon, the cabinet, looking at section 16 of the St. Lawrence Seaway Authority Act, is going to approve the increase. Then we will have an announcement some day on motions or on the orders of the day that the tolls on the St. Lawrence seaway have been increased.

This is not good enough, because these increases will be made by order in council and not by act of parliament, and there will be no opportunity for members of parliament to express their opinion or suggest any alternative course of action. The Acting Minister of Transport this afternoon said that this question can be discussed in the transport committee. That is a ridiculous proposal. In the first place, as my colleague the hon. member for Winnipeg North Centre (Mr. Knowles) pointed out, the chairman of the committee can, quite properly, say that the only items which appear in the estimates of the Department of Transport have to do with the servicing of certain loans and payment for the maintenance of certain canals, that these matters are not concerned with tolls and the committee has no authority to deal with tolls. In any event, the government has a majority on the committee. Even if the committee is permitted to discuss this question of increased tolls, and that is doubtful, can anyone assure this house that the discussion will take place in the transport committee before the order in council is passed increasing the tolls?

I think most members here would be willing to take a wager that the order in council will be passed long before the committee on transportation ever gets around to discussing estimates. Moreover, Mr. Speaker, this is not a matter just for a committee of the house; this is a matter for parliament itself. It is a

DEBATES May 26, 1966

matter of such vital importance to the economic well-being of Canada that the whole house should have an opportunity to discuss it, and discuss it from every conceivable angle.

[DOT] (7:30 p.m.)

Therefore I want again to ask the government the two questions which I asked the ministers this afternoon: First, will they assure the house, before the debate is finished, that when the seaway authority makes its report to the government, that report and its recommendations will be published. This would make it possible for us to know what the recommendations are. Most of us have a pretty good idea what the recommendations are likely to be, but I think we have a right to know definitely what those recommendations are and what arguments are advanced by the seaway authority for proposing an increase in the tolls. That report should be made public before the government reaches any definite conclusion. I think we have the right to ask the government for that assurance.

The second thing we have the right to ask is that, having had access to the report, the government will not act on it until this house has been given an opportunity to debate the report fully, and the effect which those recommendations would have on the welfare of the people of Canada and the economy of this country.

Mr. Speaker, I do not think I am making unreasonable requests. I think this is the very least the government can do. If it is not prepared to stand up at this time, as I had hoped it would be, and say to the house that because of the rapidly rising cost of living, because of the necessity of getting our goods to the world markets it can assure the house that it will find ways and means by which it can prevent an increase in tolls at this time, surely the very least it can do is, first, to let us have a copy of that report as soon as they receive it and before they make a decision and, second, to give the members of the house an opportunity to debate the whole question. We would rather see that done than have the cabinet make a decision in secret affecting the economy of this nation, and then tell the people of Canada what they have done.

I think it is not enough to use parliament merely as a place where we make protests. If democracy means anything, it means an opportunity to participate in the making of decisions. If parliament means anything at

May 26. 1966

all, it is a place where the government asks members-particularly in a house of minorities-to give their views and their suggestions before the government commits this country to a course of action which could have detrimental results for the Canadian economy.

Topic:   TRANSPORT
Subtopic:   SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26
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LIB

Donald Ross Tolmie

Liberal

Mr. D. R. Tolmie (Welland):

Mr. Speaker, the recent announcement that the St. Lawrence authority and its United States counterpart are proposing increased tolls on the St. Lawrence seaway and new tolls on the Welland canal, was of great concern to many Canadians.

Although the Canadian and United States governments will make the final decision in this matter, this declaration of intent has caused alarm in many circles. Lack of time prevents me from giving you a detailed analysis of the conflicting arguments as to the desirability of tolls-and there are conflicting arguments. Basically, those who believe we should have tolls on the seaway contend that if we do not, foreign shipping will in effect be subsidized, and commerce which uses the waterway should pay for its construction and maintenance. However, there are many formidable arguments for a toll-free seaway and in my opinion they are conclusive.

The gist of my argument is that the St. Lawrence seaway is of national importance and benefits Canada from coast to coast as wheat from the prairies, general cargo from industries in central Canada, coal from Nova Scotia and iron ore from Newfoundland are carried through it and help this country to prosper and develop.

Those who oppose tolls argue that if tolls are increased, not only will industry be forced to increase prices, thereby causing domestic financial hardship, but that the goods will be priced out of foreign markets at a time when Canada is desperately striving to improve its export position. It is further argued that other national forms of transportation, the C.N.R., the trans-Canada highway and Air Canada, are heavily subsidized by the federal government, and a national water artery such as the St. Lawrence seaway should not be discriminated against.

Those who are in opposition to tolls cite the fact that the United States Association of Railways and the United States Eastern Ports Association have been lobbying continually in a determined effort to have tolls increased on the St. Lawrence seaway so as to place United States interests in a more competitive position to capture a greater share of the

Seaway and Canal Tolls carriage of bulk cargo, especially wheat and iron ore, with a resultant benefit to the entire U.S. economy and a detriment to Canada.

Hundreds of industries, many located in the Niagara peninsula, are adamantly opposed to tolls, and many chambers of commerce across Canada have forwarded strong briefs to the government opposing any increase in tolls. The eventual government policy in this matter is of prime concern to all of us. The preponderance of evidence in my opinion clearly demonstrates that Canada's best interests will be served if any proposed increase in tolls is denied.

Topic:   TRANSPORT
Subtopic:   SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26
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PC

Richard Elmer Forbes

Progressive Conservative

Mr. R. E. Forbes (Dauphin):

Mr. Speaker, as seconder to the motion made by my colleague, the hon. member for Kindersley (Mr. Cantelon), to adjourn the business of the house to debate this urgent and important public question, I appreciate the excellent contributions that have been made by previous speakers on this important subject, and my comments will be brief. The urgency in this matter has indicated that if the request of the St. Lawrence seaway is granted, the new rates will come into effect on July 1, 1966. I cannot think of any other action by our transportation system that is as far reaching in its effect on the economy of Canada and particularly on the grain producers of western Canada.

It has been estimated by authorities that the proposed increase in tolls will cost the producers of grain one and a half cents per bushel at a time when wheat prices have been reduced by an average of 17 cents per bushel during the past year; and I wish to emphasize this point. Also at a time when the costs of production have risen to an all time high, if the increase in tolls is allowed on iron ore this extra cost will be reflected on the price of machinery purchased by farmers. The farmers have no way of passing on their increased costs to the purchasers of their products.

Much of the current high level of business activity in Canada is due to the building of the St. Lawrence seaway and the deepening of the Welland canal, for without these two vital transportation facilities, both largely due to Canadian initiative, it would not have been possible for the government of Canada to contract to supply Russia and other European countries with wheat on the enormous scale that has been evident in the past three years.

May 26. 1966

Seaway and Canal Tolls

[DOT] (7:40 p.m.)

If canal tolls are imposed, every one of the 200,000 or 300,000 grain producers on the prairies will have to accept lower prices for his wheat and other grains exported. Let us review very briefly the history of water transportation with respect to tolls. In 1904 Sir Wilfrid Laurier stated that if tolls were imposed they would be an additional burden on the grain growers of the west. This was interpreted as favouritism to the west, although it really was an effort to lessen the charges on the movement of wheat from Fort William and Port Arthur to Montreal, destined for the markets of the world. When George P. Graham was minister of railways and canals, he stated:

It cannot be denied that every dollar you impose in tolls must come out of the produce or the cargo. There is no other way to pay for it.

I wish to quote again from the MacPherson report on transportation, volume 2, page 195:

We would not wish, in other words, to encourage the Canadian public to believe that a country such as ours can expect to obtain the kind of transport facilities, designed to fulfil national policy objectives that transcend commercial consideration, without a continuing outlay of public funds of a considerable order of magnitude.

The seaway between Montreal and lake Ontario is the only section of over 27,000 miles of navigable waterways in North America upon which tolls are levied. If the St. Lawrence seaway is to achieve its proper status as Canada's sole means of access by water to her heartland, it must not be impeded by a crippling toll structure. Similarly the Welland ship canal, located in the very heart of Canada's major industrial zone, must be permitted to function without the obstacles of tolls.

I wish to impress upon hon. members once again the fact that low cost water transportation is essential to the continued progress and prosperity of Canada. Not only does it increase the movement of primary and manufactured goods from one part of the country to the other, but it also assists the sale of Canadian wheat and other exports in the highly competitive overseas market.

In further substantiation of my argument against the imposition of tolls, Mr. Speaker, I wish to refer to a statement made by the three western grain pools, and I quote:

Another reason why farmers oppose seaway tolls is because the toll structure seeks to recover capital investment and this the farmers do not think is desirable for a publicly-owned transportation utility. Farmers do not find justification for the recovery of capital investment from seaway

users by a government which through the years has made many kinds of public investment in transportation facilities without there being any direct obligation for the users to repay the investment. Consider, for example, the following list of public investment in transportation which was compiled by Mr. Justice W. F. A. Turgeon when he was chairman of a 1951 royal commission on transportation. The list included:

(i) The construction of the National Transcontinental Railway to encourage the shipment of goods through Canadian ports;

(ii) The construction in central Canada of an extensive canal system which became toll free, built at a cost of about $328 millions and maintained at government expense;

(iii) The granting of substantial areas of land and subsidies to encourage and assist railway construction and the opening up of the country.

(iv) The taking over by the country in the years between 1918-23 of the bankrupt railway lines and the welding of them along with government lines into the Canadian National Railway system;

(v) The construction of Hudson Bay Railway and the development of the port of Churchill;

(vi) The subsidization of coastal shipping services and large investments in harbors and other navigation facilities; and

(vii) The large investment in and operation of Trans-Canada Air Lines and assistance given to other air lines.

The learned jurist said this government activity in the transportation industry indicates "the continuous concern of parliament with Canada's transportation problems including the problem inherent in great distances and sparse population." The wheat pools do not believe the government sought recovery of its investment from the users in the previous instances and cannot support the attempt to recover Seaway investment through user tolls.

I am firmly convinced that any increase in tolls will be detrimental to the expansion of our international trade and should not be allowed.

Topic:   TRANSPORT
Subtopic:   SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26
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PC

Edward Nasserden

Progressive Conservative

Mr. E. Nasserden (Rosthern):

First of all, Mr. Speaker, I should like to congratulate the hon. member for Kindersley (Mr. Cantelon) on bringing forward this motion today. During the three years he has been in the house he has become recognized, not only as a specialist on pension problems but also on transportation problems, so it is very fitting he should be bringing forward this motion today. The hon. member who preceded me in the debate, the hon. member for Dauphin (Mr. Forbes), has been in the house for a considerable time. He has won four consecutive general elections with good majorities, and all of us have a tremendous appreciation of his work on behalf of the people in agriculture. I congratulate him for seconding this motion.

When I look at you, Mr. Speaker, I cannot help but think of the great city of Cornwall,

May 26, 1966 COMMONS

sitting like a jewel on the St. Lawrence waterway in the midst of that great industrial complex of this nation. I am sure you are taking more than a passing interest in this debate.

Listening to the Acting Minister of Transport (Mr. Turner) this afternoon, I could not help but feel that I should congratulate him upon his acting. He was at his very best, in spite of the poor case he had to present. The members of this house witnessed a spectacle this afternoon that has been seen in this house with recurring frequency over the past three years, namely a government coming to the house without a national policy with regard to the important problem of transportation. The Minister without Portfolio told us, if he told us nothing else, that the government does not have a national transportation policy to offer parliament or the country at this time. Despite the fact they have been in power for three years, despite the fact that they came into office boasting that they were well prepared and the pigeon-holes were filled with plans to put this country back on the rails, we have no transportation policy. It is significant that at this time we should have from the Minister without Portfolio this admission of the failure of the present govern' ment to deal with this important matter.

One could almost think of that phrase, I do not recall whether it was decision or indecision, but I know that hon. gentlemen opposite know to what I am referring, as they have had reason to think back about the stand they took in that regard in the past. I was interested in noticing that the Minister of Finance (Mr. Sharp) has not graced us with his presence in this debate. Perhaps he has a good reason for being absent, and I would not want to do him an injustice. However, there is no more important matter that could come to the attention of the Minister of Finance than the one which is before us today. I contend, sir, that an increase in tolls of the order of 10 per cent could very well affect the balance of payments position with the United States. When 1 say that, I am not referring to the effect on grain growers but I am referring to the movement of iron ore to the United States of America. This is one of the reasons that I believe the Minister of Finance and the Minister of Trade and Commerce (Mr. Winters) should have been here to deal with this particular matter.

Canada is emerging today as an industrial nation. There is no factor more important than exports, to the growing industries of our

DEBATES 5579

Seaway and Canal Tolls country, but to hear the Minister without Portfolio and the Minister of Public Works (Mr. Mcllraith) as they sought to deny this debate-

Topic:   TRANSPORT
Subtopic:   SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26
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LIB

George James McIlraith (Minister of Public Works; Leader of the Government in the House of Commons; Liberal Party House Leader)

Liberal

Mr. Mcllraiih:

No, Mr. Speaker, 1 rise on a point of order. That is a misstatement of my position. What I sought to do today was to prevent the regular business of the house being taken up this afternoon on this matter, which could have waited to be discussed on interim supply, or the appropriate place.

[DOT] (7:50 p.m.)

Topic:   TRANSPORT
Subtopic:   SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26
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PC

Edward Nasserden

Progressive Conservative

Mr. Nasserden:

All that the Minister of Public Works has done is to strengthen the argument that not only we in this party but those in other parties on this side of the house have maintained today. The minister sought to deny the House of Commons the opportunity to discuss-

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LIB

Lucien Lamoureux (Speaker of the House of Commons)

Liberal

Mr. Speaker:

Order. I cannot allow the hon. member to continue this trend of thought. There is a motion before the house. A ruling was made by the Chair and the hon. member has no right to go behind the ruling and argue the question all over again.

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PC

Edward Nasserden

Progressive Conservative

Mr. Nasserden:

I thank you very much, Mr. Speaker; I was just trying to answer the Minister of Public Works and I will not pursue the matter, I assure you.

We in western Canada are interested in the price of steel, of iron ore and of farm machinery which we purchase in Canada or from the United States of America. We buy a lot of farm machinery and production machinery not only in western Canada but in eastern Canada. To listen to ministers of the crown refer to a 10 per cent increase in such a cavalier manner as has been the case today of one of the factors which enter into the cost of production cannot help but make us question seriously whether they have read the budget presented by the Minister of Finance (Mr. Sharp) a few weeks ago, in which he drew attention to the important problems facing this country with regard to the cost of living, the costs of production and also the balance of payment problem with our friends to the south of us.

One of the most important factors in the production of grain in western Canada is the cost of farm machinery. Another important factor is the availability of men and women for work on farms in Canada. Only yesterday we had the spectacle of the government bringing forward a measure which would reorganize the departments of government. In

May 26, 1966

Seaway and Canal Tolls this legislation the department of immigration is relegated to third position. Almost as an after thought, responsibilities for immigration are included within the new department of manpower. Surely this is part of the entire problem we are facing today and is of some significance when we are thinking about the cost of production and the need for machinery, much of which is purchased today, even at inflated prices, in order to overcome the scarcity of labour in this country.

The Minister without Portfolio (Mr. Turner) referred to some of the statements which were made at the time the legislation governing part of the matter which is before us came before parliament in 1959. I would remind him that a great deal of what took place at that time was the result of the legacy passed on to us from the administration that preceded us. I cannot help but remember the glowing terms in which members of the party opposite during the election campaign at that time paraded before the public the benefits which would accrue not only to western Canada but to all of Canada with the construction of the seaway, proudly boasting and claiming as their right, part of the credit for the construction of the seaway in the first place. It is very strange indeed, Mr. Speaker, that the hon. gentleman should question part of that legacy which was passed on to the administration that followed.

I should like to congratulate the hon. member for Hamilton West (Mr. Macaluso), the hon. member for Lincoln (Mr. McNulty), the hon. member for Welland (Mr. Tolmie) and the hon. member for Port Arthur (Mr. Andras) for the contributions they have made in this debate. I think they have welcomed this opportunity, despite what their front benches said during the initial stages when we were trying to establish the merits of having a debate at this time. They showed that they came well prepared to fight the battle. If the decision of the Chair served no other purpose, it gave these backbenchers on the government side an opportunity to voice their opinions where they could be heard, and where they could serve some useful purpose in regard to bringing this question not only to the attention of the cabinet but also to the attention of the country and the people of their own constituencies.

I have said before, and I want to reiterate, that the proposed 10 per cent increase in tolls is a very serious one, particularly as it affects the export trade of our country. Grain sales during the last several years have been one

[Mr. Nasserden.)

of the mainstays of our economy. All of us in western Canada have felt very downhearted at the reduction in the final payments for wheat during the past year. Hon. members in all parts of the house, whether or not they come from agricultural ridings, whether they are in business or in agriculture or just carry a dinner pail, cannot help but know something about what it means to chop off almost 15 per cent of the take-home pay which one has enjoyed in years previous. In view of a reduction of 13 to 17 cents per bushel, and being faced with the prospect of a further reduction which would almost cut in half the benefits brought about by the seaway when it first came into operation, the producers of grain in Canada cannot help but express their indignation and concern. In addition to this, Mr. Speaker, the grain producers are faced with tight money, higher interest rates and a high cost of living. This is reason enough for any parliament to concern itself with the problems before it.

I recommend to the cabinet the proposal put forward by one of the members from Halifax to amortize the capital costs of the seaway over a much greater period of time than is presently the case. The seaway has been in operation for only seven years, which is a mere drop in the bucket to the number of years we hope it will be in operation. I think with any business in the initial years of operation you must expect your returns will not be as great as they will be when the business is at full capacity. It is a fact that at the present time the seaway is operating at something less than two thirds full capacity. There is also the prospect that as the capacity is reached other avenues will open to increase the capacity of the seaway if traffic on the seaway so warrants. Those who brought forward the idea of an all-Canadian seaway were perhaps voicing something that will one day be a reality.

[DOT] (8:00 p.m.)

I do not think I can add anything else to the debate, but I should like the members on the treasury benches to give parliament an opportunity to discuss the decision reached in this matter before it is made final. I think this is an important matter that affects not only the cost of transportation, but the whole business cycle in our country, and also our trade with other nations. As such I feel that this matter deserves consideration by the cabinet and by parliament.

May 26, 1966 COMMONS

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?

Mr. J.-A. Mongrain@Trois-Rivieres

Mr. Speaker, I am interested in the matter of tolls on the seaway, because I represent a municipality where grain elevators are located and which is involved in extensive shipping, even in winter, in spite of the objections of our colleagues from the Maritimes.

By the way, I must say that our winter shipping does not deprive them of anything; on the contrary, I think it helps to speed up the handling of goods in riverports and seaports. But the matter is not being discussed this evening.

After listening to earlier remarks, Mr. Speaker, I ask myself two questions, and I must say that I do not feel capable of settling the matter. If I take part in the debate, it is precisely because my district is involved and, as its representative in the House of Commons, I am interested in knowing what might be the effects of an increase in tolls on the Canadian economy.

I was amazed to note how strongly some members objected to increased tolls, especially the great number of government members who spoke freely, in a way which should be stressed and encouraged in this house as often as possible.

Today's papers report numerous protests against increased tolls on the seaway, protests which, according to a French language paper this afternoon, "submerged the public hearing". This means there were many.

I wonder where those protests come from. First of all, were they all made by people intent on protecting their business or by some who consider primarily the consequences of increased tolls on the Canadian economy, because, after all, this should be the main concern, in my opinion.

I have nevertheless observed that most insisted that they felt the Canadian economy was at stake and that tariff barriers should be brought down.

I was struck, Mr. Speaker, as doubtless all Canadians interested in this question are, by the fact that last year, the debt of the St. Lawrence seaway was about $24,700,000 and that the Canadian share was $18 million. I wondered: Who will be paying this debt, because someone will have to pay.

Some claim the ships using the seaway should not have to pay. I have no objection, mind you, Mr. Speaker, but I should nevertheless want this position to be demonstrated to me. Such are questions that I should like

DEBATES 5581

Seaway and Canal Tolls to put to those in a position to answer and I should like to be shown that it would be beneficial to have this paid by the Canadian people.

Is it true that rate increases will reduce traffic? Is that not a slight exaggeration? I wonder. Is it true that the rate increase will cause considerable loss of jobs here in Canada? Can anyone anywhere imagine that the full investments in the St. Lawrence seaway should not be reimbursed?

A colleague suggested a while ago that the refund of the debt should be extended over a period of 75 to 100 years. I am aghast at the thought of the interest that Canadians would have to pay, at current rates, if such amortization of capital were to be spread over a period extending from 75 to 100 years. There is obviously something out of kilter in that.

Finally, Mr. Speaker, someone will have to pay. Who will that be? That is the question.

While we were discussing these things just now, I read the editorial of a newspaper which, I believe, came out this afternoon, whose author seemed to be well-versed in maritime matters. I shall quote this article from the Canadian Sailor, which reads as follows:

What irritates us-and should irritate any thoughtful Canadian-

And I quote:

-is that almost 28 per cent of cargo on the seaway is carried by ships bearing flags other than Canadian or American, and almost all these foreign ships are subsidized by their respective governments.

We have no such subsidies-

Mr. Speaker, if tariffs are to be kept low so as to allow ships operating under foreign flags to compete with our own, something is obviously wrong somewhere.

Therefore, I should like to ask the following questions. Who will pay this interest and this amortization of capital? Is it right to ask all Canadian taxpayers to do so? If so, it will have to be proved that this is an incentive or an encouragement for the Canadian economy. Otherwise, this would be unfair, and the cost should rather be borne by all those who use the seaway. It would have to be proved beyond doubt that these tariffs which we are going to impose on the national budget, which all Canadians will in fact have to reimburse, will stimulate the whole Canadian economy, not just a sector or an industry.

Once again, Mr. Speaker, I would like to stress the fact that I lack the necessary competence to settle the debate, but I might

May 26. 1966

Seaway and Canal Tolls be allowed to submit one thing to the attention of the house. I am not convinced that the solution proposed by the hon. member for Halifax is the right one, but if it can be shown to me that the Canadian government, in short the Canadian people, must help, give a boost to that sector of the Canadian economy, that is to the maritime traffic which uses the St. Lawrence seaway, I would like to submit the following.

Let the government increase those rates to the greatest extent possible and reasonable, but in order not to hurt Canadian shipping, ships which operate under the Canadian flag, not to create any deterioration in waterway or seaway transportation, which would probably have repercussions such as unemployment and possibly a slow down in the shipments of western grain, as well as some harmful consequences in our region of Trois-Rivieres, I make a suggestion before quoting a statement in support of my argument. Would the government not be ready to study the possibility of giving reasonable and reasoned subsidies to ships registered in Canada, to allow them to compete with ships registered elsewhere and using the St. Lawrence seaway?

[DOT] (8:10 p.m.)

I see here in Hansard that on April 2, 1965, the present Minister of Transport (Mr. Pickersgill) said this:

The seaway did better last year than it did the year before-

We were in 1965, therefore, he was talking about 1964.

-and we hope it will do still better this year. We hope it will get into balance in due course. Traffic is increasing steadily.

That was on April 2, 1965, as I said before.

I hardly dare hope for quite as big an increase this year as there was last year because we had this tremendous wheat traffic, but the prospects look very good.

If the prospects are very good and if eventually the seaway will be an economic operation, why not use grants to amortize the capital of $500 million plus the interests in order not to harm our maritime transportation and enable it to compete with foreign transportation?

Will the increase of rates drive away ships flying foreign flags? Once again, I do not claim to be an authority on the matter, but those ships come here because it is beneficial to them. Increasing the rates by 10 per cent

IMr. Mongrain.]

will not prevent them from coming here to transact their business.

Does this 10 per cent not correspond in general to an increase or decrease of the dollar value, to a sort of inflation which took place here since the building of the St. Lawrence seaway?

Mr. Speaker, you noted my suggestion. I believe it is valid and interesting. Once again, the whole economy of the area I represent and that of several neighbouring ridings are vitally affected by this seaway shipping. Our grain elevators represent an important asset in our economy.

This would perhaps be a temporary solution that should not last too long, if I can trust the statements of the minister. As I said, until this is economic, certain subsidies could be granted in the meantime to ships flying the Canadian flag, and this could serve as an outlet for our Canadian economy.

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PC

Eric Alfred Winkler (Chief Opposition Whip; Whip of the Progressive Conservative Party)

Progressive Conservative

Mr. Eric A. Winkler (Grey-Bruce):

I am

pleased to have the opportunity to take part in the debate this afternoon concerning the possibility of increased tolls on the St. Lawrence seaway, and the increase of fees on the Welland canal. There has been a wealth of participation today, expressing views held across this nation. I have listened to the western members making a logical plea on behalf of the grain industry. I have heard Ontario members speak of the problems which higher tolls would create in central Canada. We have heard the point of view of members from Quebec and the maritimes. It is evident that this debate was extremely necessary and of importance to the Canadian economy.

The proposition for increasing revenues from the St. Lawrence system is twofold. First, there is to be a 10 per cent increase in tolls. We now understand that this was in the program when the initial legislation was passed. The secondary method of increasing revenues is to be the imposition of lockage fees in the Welland system, the Canadian-operated part of the system.

I think the authority, as well as the government, would be well advised to investigate the legality of imposing lockage fees in the Welland portion of the system. These fees will represent a considerable amount of money to shipowners. I believe they will cost some $160 a vessel next year, rising to $800 in 1971. It may be found that this secondary proposal for raising revenue is legal, but I am

May 26, 1966

sceptical about it. However, the revenue is raised it must all be considered as coming from increased tolls on the system. I feel that this method of raising revenue is unjust and, possibly, illegal. Since the projected sum involved amounts, roughly, to $100 millions, an investigation would certainly be worth while.

I understood from the words of the Minister without Portfolio (Mr. Turner) that we might expect an increase in tolls almost as a foregone conclusion. I was sorry to hear him give this impression. I was sorry to note the lack of hesitation with which he seemed to argue there was no other way of handling the situation.

It appears that the pleas made by two of the backbenchers on the other side, the hon. member for Hamilton West (Mr. Macaluso) and the hon. member for Welland (Mr. Tol-mie) will go unheeded, though they put forward their arguments not from a parochial point of view but, it seemed to me, with the best interests of the entire Canadian economy at heart. Indeed it would have been odd had they spoken otherwise.

It is interesting to note that the Secretary of State for External Affairs, the hon. member for Essex East (Mr. Martin) was in the house for a short time, and then left. It would be interesting to hear his views on this question-to hear whether or not representations had been made to him on behalf of heavy industry in his part of Ontario. I am sure we all know what the answer would be. Anyone who is familiar with the situation knows what the effect will be on the Canadian economy as compared with the United States economy.

We heard the hon. member for Welland say that strong lobbies are being built up in the United States in favour of the institution of tolls. Why not? The benefit on the United States side would be felt largely on the upper great lakes. Those areas will be toll-free. But in southern Ontario, the area from Windsor eastward to lake Ontario, Canadian heavy and secondary industry will have to bear not only an increase arising from higher toll charges but also an increase arising from charges in connection with the Welland canal. Thus will Canadian industry be placed at a disadvantage and United States industry will once again have an advantage over us in a comparable field. This is an important and serious matter in so far as I am concerned.

Seaway and Canal Tolls [DOT] (8:20 p.m.)

I come from a part of southwestern Ontario where we are endeavouring to attract secondary industry, but much of the secondary industry we want to attract would be completely submerged if 1 per cent of the production of similar U.S. industry were allowed into the Canadian market. Why should the government, or any agency of it, be permitted to consider even a fractional increase where it disadvantageously affects Canadian industry? This is ridiculous, particularly under present circumstances.

At the present time in the province of Ontario an ambitious program for regional development is being undertaken. But in our part of the country we have witnessed the utter disregard of some ministers in the federal government for areas that need assistance and support. Now we have another instance of the government's failing to move into the area of common sense where Canadian industries are concerned.

The proposal to increase tolls will affect to a large degree development areas in western and northern Ontario, and particularly the shore areas along the seaway and the Welland canal, because the charges will be spread over small ships as well as large ships, and there is no question but that small industries and small centres will be affected in a detrimental way.

We would like an assurance from the government that it is cognizant of the effects of such action by the authority. The least it can do is defer any final decision by the authority. After having been here for some considerable time I am now coming to the opinion that the Canadian people are fed up with being governed by commissions, boards, authorities, and such things, with the ultimate responsibility being taken away from parliament. This is a view which is not held only on this side of the house. From what was said today I know it is also the view of some government supporters who know what the effect of increased charges will be. Surely, Mr. Speaker, it is a known fact that such arbitrary decisions are taken without the benefit of discussion in parliament and without the benefit of discussion by people from the areas directly affected. We should have something to say when this happens.

Not many weeks ago we sat here and listened to the Minister of Finance (Mr. Sharp) delivering his budget speech. He mentioned inflationary pressures and said we should cut out this and that. Yet if this

May 26. 1966

Seaway and Canal Tolls proposal is adopted the government will be placing a further harness on industries in southern Ontario, and to this I take exception. This afternoon we heard that this proposal will also affect the primary producers in western Canada. We are interested in every aspect of the Canadian economy and we must have something to say in regard to what the authority is going to do when its proposals affect our economy from coast to coast.

I noted in an article a day or so ago that this matter was discussed in the Ontario provincial legislature, and I agree totally with the views of the prime minister of that province who spoke in very strong terms against the proposal. The headline on the article read, "Robarts Denounces Seaway Proposal to Levy Tolls on Welland Lock Traffic." I object generally to the application of such a toll because of the effect it will have on the province of Ontario. If we had the opportunity to present the views of the western provinces, of the central provinces and the eastern provinces, in view of the economy as it stands today we could come to no other conclusion than that the lockage levies on the Welland canal should not be tolerated.

The other day when making a statement in this house a government minister said that a certain situation had to change because we are living in 1966. Simply because the initial levying of charges by the authority was authorized some years ago, in order to conform to a certain program, is no reason why we should continue with them today, particularly since we would be acting counter to some of the policies and programs launched this year by the government. This is a responsibility of the government.

I disagreed with what the government house leader had to say. I do not wish to speak on the urgency of debate or other things which have been determined, but I am not prepared to accept the contention that we could have treated this legitimately through some other method of debate. The government has a practice of waiting until it can pull the wool over our eyes, and I am very pleased that we had this opportunity to have this debate today.

I am not being proud or boastful, or anything of that nature, when I say that the province of Ontario contributes more to the coffers of this nation than any other province in the Dominion of Canada, and we in Ontario need every consideration to ensure that

our competitive industrial position is not affected. The people in western Canada need the same protection. I have the same feeling with respect to secondary industries in the province of Quebec, although this proposal may not affect them to such a serious degree. I also welcome the contributions made to this debate by members from the maritimes.

We simply cannot tolerate to have any outside authority make arbitrary decisions on something that will affect the economy of this country in such a serious way as the proposed toll charge increases. I hope members of the government will have the intestinal fortitude to back policies that will assist our primary and secondary producers, instead of selling them out to someone else who then will have an advantage over us.

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PC

Richard Russell Southam

Progressive Conservative

Mr. R. R. Soulham (Moose Mountain):

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NDP

Norman Edward Fawcett

New Democratic Party

Mr. Norman Fawcett (Nickel Bell):

After what has been said today, Mr. Speaker, I do not think there is a great deal left for me to say except to enlarge on a couple of points. One is the point my leader, the hon. member for Burnaby-Coquitlam (Mr. Douglas), raised with regard to the handling of iron ore. Since I come from a riding in northern Ontario which already is affected adversely by high transportation costs, naturally I am very much interested in anything which might increase transportation costs, even though this may be very minimal. I believe the hon. member for Burnaby-Coquitlam mentioned the fact that iron ore mines which could be considered marginal operations might find

May 26. 1966

Seaway and Canal Tolls themselves in difficulty with regard to this suggested increase in the tolls.

I come from an area in which we have what could be considered as a marginal iron ore mine. I know that they negotiate the rail rates for the shipment of this iron ore to the closest port on the great lakes where facilities for unloading it are available. They negotiate the rates with the Canadian National Railways. I am quite sure that if they were unable to obtain the rate which they feel they require, and which is acceptable to the Canadian National Railways, they would not be in operation today, because their profit or margin is so low that they are not in a position to pay high transportation costs. I do not wish hon. members to think I am suggesting that the increased toll rates would affect this particular company, because I do not think this is the case. They ship directly across the great lakes, and I do not think their shipments would be affected. I would be very fearful, however, that there are many of these so-called marginal iron ore mines which may be affected. These mines operate on an over-pit basis. It is possible for them to move great quantities of low-grade ore so long as their transportation costs are within reason.

Generally the people who are engaged in mining the ore are the same people who convert it into steel. They are satisfied with a very low profit on the ore, because they are in the position to make up for this in the production of the steel. I would be fearful that these suggested higher tolls could result in some of these mines being closed down, with the resultant loss of employment. I believe I speak for all of northern Ontario when I say there are a great number of potential iron ore mines in this area. I believe some of these would be in operation were it not for the fact that the rail haul is too long and therefore the transportation cost is too great.

While these additional tolls may not have any affect on this situation, there is the possibility that they could. Northern Ontario perhaps is affected more by automation than many people realize. The number of lumber workers has been reduced to a great extent; the railways are continuing with the process of automation, and this too is reducing employment. If there is any possibility that these potential mines might be put into operation, we do not want to do anything which will discourage them, since this would have an affect on employment and on the economy as a whole.

[DOT] (8:40 p.m.)

I wish to say a few words about the movement of grain. At the outset I should like to say that the mover of the motion today represents a riding in which I was born and grew up, so grain is not entirely new to me; I do know a little about grain farming. I should like to make this point also. As a result of working on the railway I found that railwaymen generally assessed the economic situation of the western farmer by the business offering on the railway. If the western farmer had money to spend, the railroader was busy; if he did not have money to spend, the railroader was not busy. When I say this I do not mean that if the western farmer was not shipping grain over our line, we were not busy. The point I am trying to make is simply that even though we did not get a great portion of his grain, when the western farmer had the grain to sell, and when he had the dollars in his pocket, he was buying implements, automobiles, and everything else. As a result, the railroad was very busy.

Therefore even though this suggested 1\ cents a bushel extra toll on grain appears small, on the whole I think it would have a very serious effect on our economy. I think we would certainly see its effects on the manufacturing industries, the transportation business and, I would say, the oil and petroleum industries as well. I do not intend to take up any more time, Mr. Speaker. I would just like to say that as far as I am concerned I thoroughly support everyone who has spoken in this house in opposition to any suggested increase of tolls on the seaway.

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PC

Gordon Drummond Clancy

Progressive Conservative

Mr. G. D. Clancy (Yorkton):

this increase in tolls represents a lack of faith in our country. It is a 50-year write-off. If you think this country is going to stand still, you have less faith in it than I have; because it is not standing still and we are going to move forward. I had a speech written out, Mr. Speaker, but if I read it I would just be reiterating everything that has been said in the debate so far. So in conclusion I say, let us have faith in this country.

Mr. J, E. Pascoe (Moose Jaw-Lake Centre):

Mr. Speaker, I am pleased that we have an opportunity to express our views on the proposed 10 per cent increase in tolls on the St. Lawrence seaway. I consider it the duty of as many members as possible to participate in this debate. The vital importance of the question is demonstrated by the fact that the regular business of the house has been adjourned so that the problem can be thoroughly discussed. I think we have had a very full discussion today, although there are probably enough speakers to continue the debate for another day.

Reference has been made to the public hearings in Ottawa in the past two days. As I understand it, the purpose of these hearings was to test the public attitude and public reaction to any toll increases. I believe the public attitude has been very clearly demonstrated in the two-day hearings, and it certainly has been demonstrated very clearly in the debate we have had today.

Earlier speakers expressed very clearly the viewpoint of western Canada. I do not believe it is necessary to repeat the arguments they have presented, but I should like to refer to the brief presented by the Canadian Co-operative Wheat Producers Limited at the hearing yesterday. Canadian Co-operative Wheat Producers Limited represent the farmer-owned wheat pools of the three prairie provinces and certainly this organization speaks for the majority of western farmers, particularly wheat farmers. Mr. Gordon L. Harrold, president of the Alberta Wheat Pool presented the brief, which recommended that the tolls cover operating costs only. In this regard he expressed the opinion that the present tolls were more than sufficient to cover the operating costs. The government of Saskatchewan also presented a brief which was placed before the hearing by the minister of highways and transportation of that province, Mr. Grant. It endorsed the stand put forward in the brief presented by the wheat pools.

Seaway and Canal Tolls

I just want to re-emphasize the vital position of the prairies as the inland portion of Canada. I will not present the map to the house, but it shows how we are dependent on the seaway for a great deal of our traffic. I was happy to be on the first ship that passed through the seaway after the official opening on April 25, 1959. I should like to read what I reported to my constituents at that time:

The seaway will bring huge freighters more than 2,500 miles inland to the lakehead.

That was at the beginning of my speech, and later on I said:

It is not too clear, as yet, just how great will be the benefit to western Canada in having freighters calling almost at the west's doorstep. The saving in shipping costs for prairie wheat will be at least 5| cents a bushel because this much has already been announced by the Canadian Wheat Board and has been added to the lakehead wheat price. This means extra cash to prairie wheat growers on wheat shipped from the lakehead.

It was encouraging to hear very strong views expressed by speakers on the government side of the house in support of our arguments against any increase in seaway tolls. I trust that these comments from his own colleagues will be drawn to the attention of the Minister of Transport (Mr. Pickersgill). In fact, the Minister of Transport himself made a statement in the house that I consider to be in support of our arguments against any increase in the cost of exporting wheat such as would result from higher seaway tolls. On September 14, 1964, the Minister of Transport made this statement as reported in Hansard:

We consider, as every government has considered-at least for a generation-that one of the national interests of this country is to maintain the tremendous grain export business that has been one of the main sources of income for the Canadian people in the whole of the twentieth century.

[DOT] (8:50 p.m.)

It is true, Mr. Speaker, that he was referring at that time to the Crowsnest pass rate, and he stated that the government had no intention of removing these rates which helped the export of our wheat. However, I think that the argument is just as convincing for the seaway tolls.

Now, Mr. Speaker, I am speaking in particular for wheat exports and the movement of wheat. Other speakers have spoken for other exports and other movements through the seaway. I should like to refer to the annual report of the Canadian Wheat Board which states the following:

The sales policy of the board was directed to obtaining the largest possible share of the reduced world import requirements.

May 26, 1966

Seaway and Canal Tolls

Further on it states:

Pursuant to its obligation to promote the sale of grain produced in Canada in world markets the board endeavoured to keep its prices for export wheat competitive at all times-

The board quoted separate daily asking prices for wheat (a) in store Pacific ports, (b) in store Fort William/Port Arthur and (c) in store Churchill. Export selling prices c.i.f. St. Lawrence ports, c.i.f. Atlantic ports and, as required, in store at intermediate seaway ports were also announced by the board.

The purpose of regional pricing was to maintain the competitive position of export wheat in major commercial markets irrespective of the port of shipment.

Further on it states the following, and this applies to the 1964-65 crop year:

Shipments from Fort William/Port Arthur-380 million bushels.

As other speakers have stated, the president of the Saskatchewan Wheat Pool estimated that a 10 per cent increase in seaway tolls would mean an additional \\ cents a bushel in the cost of exporting wheat. Moving 380 million bushels of wheat through the lakehead at an extra cost of 11 cents a bushel would mean roughly $5 million out of the farmers' pockets. I think this is a very good argument against increasing the seaway tolls.

Mr. Speaker, I would like to refer to a statement made by the Canadian Federation of Agriculture. This statement was made in 1964 at which time there was pressure from U.S. interests to increase the seaway tolls. I think it should be put on the record because I do not believe that it has been put on the record so far. I will just read part of it:

The federation delegates took another look at the organization's policy position on St. Lawrence seaway tolls at this year's annual meeting. They resolved to strongly oppose any increase in tolls on the section of the seaway from Montreal to lake Ontario, to oppose any toll charges whatever on on the Welland canal, and to oppose the principle of recovering capital costs of the seaway through the collection of tolls.

This will strengthen the arguments of the member for Grey-Bruce (Mr. Winkler).

The report states further:

In making these decisions, the federation delegates had these considerations in mind. First, they recognized that the seaway was built to benefit all Canadians through lowering costs of products moving through the waterway for both the domestic and export markets. Second, it was pointed out that the Montreal to lake Ontario section of the seaway is the only waterway in North America which is subject to tolls. Third, that while there may be some obligation and justification for attempting to recover operating and maintenance costs by charging tolls, any attempt to recover

[Mr. Pascoe.l

capital costs in the same way would defeat the purpose of the seaway by making its utilization uneconomic for many users.

There is one more paragraph which stresses the point I am trying to make. It says:

Tolls on the seaway, of course, affect farmers in two ways.

Then, speaking for western grain farmers, it continues:

Export grain transported through the waterway loses some degree of competitiveness in world markets, or farmers receive less returns for their product. In the second place, the costs of goods that farmers buy stand to be higher, whenever such goods, or the materials from which they are made, are transported through the seaway.

That is the point which I was trying to emphasize, that any increase in seaway tolls would affect the prairies. Of course, it also affects other parts of the country. It would affect us in two ways.

As I stated at the outset of my remarks, this debate has been most necessary because it made it possible to put on the record arguments that must be carefully considered by the government and by the seaway authority. These arguments against increased seaway tolls must be pressed home now. The Minister of Transport (Mr. Pickersgill) has clearly stated that a decision will be made soon. I will read what he said as reported in Hansard on March 24 at page 3086. He is referring to discussions between the St. Lawrence Seaway Authority and the St. Lawrence Corporation of the United States. He speaks about the possibility of a revision of the existing tolls, and says:

I understand that the parties to this discussion now feel they are fairly close to agreement as to what they will be prepared to recommend to the two governments.

To me that indicates that a decision has been taken and a recommendation will be made to the government very shortly.

In briefs presented to the standing committee on transport and communications recommendations have been made for a transportation authority which would have the power to work out an over-all policy for all transportation by rail, by air, by bus and by water. I believe it is necessary to have such an over-all transportation policy. I believe such a policy will evolve eventually. In the meantime I support the arguments presented today against any increase in seaway tolls.

Topic:   TRANSPORT
Subtopic:   SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26
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PC

Lawrence Elliott Kindt

Progressive Conservative

Mr. Lawrence E. Kindt (Macleod):

Mr. Speaker, I wish to speak for a few moments

May 26, 1966 COMMONS

on the subject of the possibility of toll increases on shipping on the great lakes. Some time ago I asked the Minister of Transport what was the position of his government with respect to these increases. His reply was that in due course the St. Lawrence Seaway Authority would ask for briefs, brochures and other representations from various organizations. When the facts were made known to them, they would make a decision and inform the government of it. Nothing up to that point would become mandatory or operative until the government, in turn, passed an order in council implementing the recommendation.

[DOT] (9:00 p.m.)

The purpose of this debate today is to give parliament an opportunity to talk and make representations to the St. Lawrence Seaway Authority before they make their decision. It was extremely disturbing to me when the house leader on the government side tried to find some means of putting off this debate under standing order 26, by means of which we sought to discuss these tolls. I am glad that it has been going forward. I have listened to many of the speeches this afternoon and I must say that if these representations reach the ears of the St. Lawrence Seaway Authority, they should have the desired effect.

Who is going to make these representations to the authority? Well, it may be the wheat pools or it may be the United Grain Growers in so far as wheat is concerned. This dispute affects not only grain shippers but every type of shipper. What is the implication of an increase in rates? Anyone knows that when you set rates on the lakes or any other transportation system, that changes and moves a lot of other things. What formerly looked like a good market could now be out of reach of a particular industry simply because of the increase in rates. This could happen.

It is no wonder that many people are exercised about what is going to happen to the rate structure which has been in effect for a number of years. If these rates are to be increased, as is proposed, by a cent and a half or whatever it is, this would cost the farmers of western Canada roughly $5 million in extra transportation charges on their wheat going through Fort William or Port Arthur. This would be $5 million they would not get. The only way you can look at the situation is that this sum comes directly out of the pockets of the farmers of western Canada. It will be money they will not have to spend. It

DEBATES 5589

Seaway and Canal Tolls will reduce their standard of living, and many have incomes which will not stand this additional charge.

We hope that this discussion will cause the St. Lawrence Seaway Authority to pause and reconsider any recommendations which they might wish to make to the government. We would expect, therefore, when the decision is made it will be amply supported. If that is not the case, then it will be the duty of this government to ascertain the facts and decide what they intend to do. We do not feel like leaving it to this government because they do not have too good a reputation for taking action on matters of this kind in favour of the producers and people of western Canada.

There is another aspect to this entire question, namely, why not balance the raising of tolls on the great lakes against a possible reduction in volume, if you raise the rates If the rates are raised, someone is going to decide that he cannot afford to pay them and will not ship. What do you want? You cannot have it both ways. It would be better to leave the rates as they are and increase the volume. This would bring in a certain sum of money. If, on the other hand, you raised the rates and had less shipping you might end up with the same amount of money.

From an economic point of view, and from the point of view of the good of Canada as a whole, I think there is no question but what an increase in the volume of shipping and keeping the toll rates as they are would produce more money than the raising of rates and the curtailment of shipping. I hope therefore that this St. Lawrence Seaway Authority will take this point into consideration and think twice before they raise the rates on the great lakes system.

I am glad that this debate in parliament has given everyone who is concerned with this problem an opportunity to express his views. I do hope that in due course the St. Lawrence Seaway Authority will make their recommendations and that those recommendations will be of a nature which will not raise the tolls on the great lakes system.

Topic:   TRANSPORT
Subtopic:   SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26
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PC

Reynold Rapp

Progressive Conservative

Mr. Reynold Rapp (Humboldi-Melforl-Tisdale):

I do not want to be repetitious, Mr. Speaker, but I feel I would be remiss in my duty if I did not speak on this matter of raising tolls on the St. Lawrence seaway. This proposal is made at a time when our farmers are caught in the price squeeze and when they are receiving less and less for their products. This threatened increase amounts to

May 26. 1966

Seaway and Canal Tolls about a cent and a half per bushel on the grain that is shipped through the St. Lawrence ports. On the other hand, this situation may be an eye opener for some of our farmers, particularly those in northern Saskatchewan who could make much greater use of the Hudson bay route for shipping grain to Europe. St. Lawrence tolls have no effect on grain shipped through Churchill. It is a saving for the grain growers in northern Saskatchewan, and more use should be made of this.

Long before this question came up in the house, I received many letters from my constituents. Every one of them drew my attention to the fact that this proposed increase in tolls would be a hardship on Canadian farmers who must ship their grain through St. Lawrence ports. A few years ago we only had to contend with wheat and flax, but now rapeseed is going through this route. At a time when we want to establish this industry strongly should we be faced with an increase in freight charges which may be a mortal blow to this new grain industry?

I am very pleased, Mr. Speaker, that you allowed this debate to take place today. It is a very important one and had to take place today for the simple reason that, if it had not, many millions of dollars would have been lost merely because our views would not have been brought strongly to the attention of the government.

[DOT] (9:10 p.m.)

Many of the Saskatchewan members stressed this point very strongly, for the simple reason that almost without exception our trade must be carried along the St. Lawrence seaway. I do not want to be repetitious or to delay this matter, because I know other hon. members from the west want to make a strong appeal to the government. I ask that they pay attention to our pleas and see that this increased toll does not come into being. I realize there are some areas of the country which would like to see an increase, but it would be a very serious matter for the western farmer who must ship his grain through the seaway.

I see Mr. Speaker, who made the decision to allow this debate, is now in the chair and I should like to direct my personal thanks to him for allowing us to discuss the matter.

Another matter I should like to bring to the attention of the house is that even though an increase in tolls on the seaway might be requested by the tolls commission, we should never allow matters to reach the point where

the government alone would see fit to increase tolls.

That is all I have to say at the present time. Other members from the west wish to have an opportunity to express their views and the views of the people they represent here in parliament.

Topic:   TRANSPORT
Subtopic:   SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26
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LIB

James Allen (Jim) Byrne (Parliamentary Secretary to the Minister of Transport)

Liberal

Mr. J. A. Byrne (Parliamentary Secretary to Minister of Transport):

Mr. Speaker, in the debate this afternoon the Leader of the Opposition (Mr. Diefenbaker) in his usual fash-tion made an unwarranted attack on the members of the cabinet for, as he claimed, not being present during this important debate.

Topic:   TRANSPORT
Subtopic:   SEAWAY AND CANAL TOLLS-MOTION FOR ADJOURNMENT UNDER STANDING ORDER 26
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May 26, 1966