1958-01-08

[Stage Direction]
Seventh report of standing committee on miscellaneous private bills.-Mr. Rea.


Hon. Gordon Churchill (Minister of Trade and Commerce):: Mr. Speaker, during recent weeks the government has been giving close study to the food situation in Colombo plan countries. Because of short crops on the Indian subcontinent, India and Pakistan have had to import unusually large quantities of wheat, much of it from the United States under the provisions of public law 480, in addition to their usual commercial purchases from traditional suppliers like Australia; and Ceylon will require additional food as a result of recent disastrous floods.
A few months ago, as the situation worsened, a decision was made to supply a limited quantity of wheat to both India and Pakistan and some flour to Ceylon out of available Colombo plan funds. This decision was warmly welcomed by these commonwealth countries. The totals could not be as large as we might have wished, $7 million to India, $2 million to Pakistan and $1 million to Ceylon, because the funds had already been largely committed for urgent purposes of national development.
Some weeks ago, the Indian government approached us to ascertain whether Canada would be prepared to supply additional wheat for payment over an extended period. Having in mind the great interest the Canadian people have shown in assisting India in its gigantic task of economic development, the government believed that parliament would wish to go as far as possible to meet the Indian request.
Accordingly negotiations have proceeded, and I am in a position to inform the house that an agreement has been reached between the Canadian wheat board and the Indian government for the supply of a quantity of 400,000 tons of wheat, approximately 15 million bushels, to be shipped during the winter
and early spring months. This agreement is subject to the conclusion of financial arrangements between the two governments which will provide, in brief, that payment will be made in seven equal annual instalments beginning three years after shipment. Interest is payable annually at a rate equal to the borrowing cost to the Canadian government plus a small charge for overhead. This rate is not likely to exceed 4J per cent.
These terms are, of course, most unusual. They are not terms that could be offered in ordinary commercial markets without the danger of turning cash sales into long-term credit sales. They can only be justified as part of Canada's effort to consolidate the very real gains that are being made in India, Pakistan and Ceylon and other Colombo plan countries, to prevent the serious setback which could result from the need to import and pay immediately for large scale imports of foods.
When the government of Pakistan was informed of these discussions with India they asked if wheat would be available to them on the same terms, and we assured them that the same terms would be available to all countries in receipt of assistance under the Colombo plan. Pakistan also requested that part of next year's Colombo plan appropriation be used for wheat. Because of prior commitments with respect to continuing projects this would have been difficult. But, as I shall indicate shortly, the government is proposing an increase which will be of assistance to Pakistan.
We have reason to believe that India will require additional quantities of wheat, over and above 400,000 tons, from Canada during the coming months. Some of this they may be prepared to buy on terms similar to those I have outlined. Pakistan and Ceylon and other countries within the Colombo plan may also make similar requests in due course.
The government is confident that parliament will support the provision of wheat and flour to Colombo plan countries on the terms I have outlined. We are also confident that at this difficult time in the affairs of our friends in south and southeast Asia, parliament and the people of Canada would wish to see an increase in the amount of aid in the form of outright grants that is being made available to them.
When the Minister of Finance brings down further supplementary estimates later this
2980	HOUSE OF
Inquiries of the Ministry month parliament will be asked to vote approximately $30 or $35 million to be loaned to Colombo plan countries for the purchase of Canadian wheat and flour, and an additional $15 million as an outright grant for the same purpose. We have in mind that a part of the $15 million grant will be used to meet an urgent request for assistance by the government of Ceylon arising from the vhry serious floods that have caused such devastation in that country.
Canada has assumed responsibility to assist in the development of the countries of south and southeast Asia through the Colombo plan. This development is threatened by grave shortages of food. It is fortunate that our abundance coincides with their need and that we are in a position to play some further part in keeping this great effort of the free world moving ahead.
I am making this statement now so that plans for the movement of the wheat can proceed with a minimum of delay, and so that hon. members will be aware of this important development in government policy before they are asked to consider the relevant items in the estimates.

On the orders of the day:


Mr. F. D. Shaw (Red Deer):: Mr. Speaker, I should like to address a question to the Minister of Trade and Commerce arising out of the statement he made earlier today. Has the government of Canada given consideration to supplying under the Colombo plan more wheat flour or other wheat products to such countries as Pakistan which seem to lack the facilities for milling wheat? To repeat, has consideration been given to the supplying of wheat products rather than wheat to countries that lack milling facilities?


Gordon Minto Churchill: Mr. Speaker, we have the closest co-operation with Pakistan, and everything depends on the requests they put forward.



COLOMBO PLAN


[Stage Direction]
On the orders of the day:
Mr. A. M. Nicholson (Mackenzie):: Mr. Speaker, I should like to direct a question to the Secretary of State for External Affairs. Following the important statement made by the Minister of Trade and Commerce, which was well received in all parts of the house, would the Secretary of State for External Affairs again review my request that the Canadian high commissioner in Ceylon, who has completed his term of duty there, be given an opportunity to report to the Canadian


people regarding the importance of the Colombo plan before taking a new posting?


Hon. Sidney E. Smith (Secretary of State for External Affairs):: Mr. Speaker, I would accede to that request.



APPLICATION OF CREDIT POLICY TO OTHER THAN COLOMBO PLAN COUNTRIES

[Stage Direction]
On the orders of the day:
Mr. H. R. Argue (Assiniboia):: I wonder whether the Minister of Trade and Commerce can inform the house whether the seven to ten years credit policy that has been offered or has been provided to India and other Colombo plan countries will be available outside the Colombo plan area to countries which do not have supplies of dollars. Can the minister say whether this general type of offer is available to such countries as Poland and Spain?


Gordon Minto Churchill: If the hon. member will read carefully the statement I made this morning I think he will find that this particular transaction is restricted to Colombo plan countries, and that the reason I stated was that we do not wish to interfere with cash customers. Ninety per cent of our export of wheat is sold on a cash basis.


Hazen Robert Argue: I wonder whether I might ask the minister whether he considers that Poland and Spain are ordinary cash customers.


Gordon Minto Churchill: Poland and Spain have been cash customers. At the present time Poland is buying wheat from us on a short-term loan basis.


Hon. L. B. Pearson (Algoma Easi):: I have a supplementary question. Is it not true that some of the Colombo plan countries have been cash customers in the past?


Gordon Minto Churchill: Not to any great extent.



DOMINION SUCCESSION DUTY ACT

[Stage Direction]
CHANGE IN METHOD OF COMPUTING TAX] REVISION, CONSOLIDATION, ETC.
Hon. Donald M. Fleming (Minister of Finance) moved: that the house go into committee at the next sitting to consider the following resolution, which has been recommended to the house by His Excellency:
That it is expedient to introduce a measure to replace the present Dominion Succession Duty Act, to provide that the tax on property passing or deemed to pass, on death, be computed by reference to the property comprising the estate of the deceased rather than the property contained in the bequests from the estate to the beneficiaries; and also to consolidate, revise and simplify those provisions of the present act that continue to be appropriate.


[Stage Direction]
Motion agreed to.


Mr. Pickersgill: 1.	On what date did the government of New Brunswick first request financial aid for Beech-wood from the present government of Canada?
2.	What was the form of the request and what was the nature and scale of the assistance requested?
3.	On what date did the government of Saskatchewan first request the present government to join with Saskatchewan in the South Saskatchewan project?
4.	On what date did the government of British Columbia approach the present government regarding the development of the Columbia river?
5.	Has any other provincial government made any request for assistance or co-operation In any power project?
6.	If so, which provincial governments and in respect of what projects?


Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, the answer to parts 1 and 2 is that in a letter to the Prime Minister dated July 23, 1957, the premier of New Brunswick, Hon. Hugh John Flemming, said:
Federal assistance to the hydro development at Beechwood represents the most immediately required extension of the principle (of special assistance for the maritime area) in so far as New Brunswick is concerned.
A copy of this letter was tabled on January 3, 1958.
3.	The premier of Saskatchewan wrote to the Prime Minister on August 8 and in his letter he said:
Since your views and those of your party are well known on the desirability of the South Saskatchewan dam project, there is no need for me to stress the urgency for proceeding with it. However, it would be useful in preparing our budget if we knew when this undertaking was likely to be started and what contribution, if any, the Saskatchewan government would be expected to make over the next few years.
4.	This government has not been approached by the government of British Columbia regarding assistance in the development of the Columbia river.
With respect to parts 5 and 6, the government of Nova Scotia has requested assistance in respect of several projects coming within the scope of the Atlantic provinces program already announced for which the parliament will be asked to appropriate funds, and the details will be explained at that time. The government of Prince Edward Island, by telegram dated January 7, made clear its desire to have this Atlantic provinces program cover the provision of additional facilities to provide power to the island; the government of Newfoundland has also expressed its desire to have the program extend to that province. Assistance in regard to specific projects has not been requested by these governments.
Questions


ELECTRIC POWER COSTS, NOVA SCOTIA
Mr. MacEachen: 1.	Has the federal government ascertained in its negotiations with the province, the present cost of electricity to industrial users in Nova Scotia?
2.	If so, what are these present costs?


Hon. Alvin Hamilton (Minister of Northern Affairs and National Resources):: Mr. Speaker, the answer to the first part of this question is yes.
With respect to the second part of the question the answer is that these costs vary considerably. For example, some large industrial users of wholesale secondary energy can purchase power in Nova Scotia at 7 mills plus a demand charge based on the connected load plus an escalation clause tied to the cost of coal. In the case of the smaller users of industrial power, the cost of firm energy has been 30 mills or more.



NEWFOUNDLAND RAILWAY


Mr. Pickersgill: 1.	Is the government or the Canadian National Railways giving consideration to changing the gauge of the Newfoundland railway to standard gauge?
2.	If not, is it proposed to give consideration to such a change?


Hon. George H. Hees (Minister of Transport):: Mr. Speaker, I think I might deal with both parts of this question at the same time. Consideration is not being given to changing the gauge of the Newfoundland railway. I would point out that this matter has been raised on one or two occasions in the sittings of the sessional committee on railways and shipping, and I find that during the proceedings of this committee on March 18, 1957, the president of the Canadian National Railways stated as follows:
There is a very wrong impression that a narrow gauge railway is by definition an inefficient railway. That is not so. A narrow gauge railway can be just as efficient, if not more. In the peculiar circumstances of Newfoundland, and the peculiar circumstances under which your railway was built, in the matter of grades, curvatures, etc., a narrow gauge is a more efficient railway than a standard gauge would be. That is why I have said before, if the proposal were to build a standard gauge, we would never build a standard gauge on the same right of way as the narrow gauge is on. You would get a different idea about curvature, gradings, and everything else.



POWER DEVELOPMENT, NFLD.  FEDERAL ASSISTANCE

Mr. Batten: 1.	Has the government received any representation from the premier of Newfoundland since November 25,	1957, regarding federal assistance
for power development?
2.	If so, what is the nature of the representations and what reply has been made by the federal government?

Questions


John George Diefenbaker: In reply to this question, on Decern -[DOT] ber 21 a telegram was received from the premier of Newfoundland which is as follows:
I understand that you are bringing before parliament a measure enabling you to enter into agreements with Atlantic provinces governments for the development of thermal electric power plants. I respectfully suggest that the word thermal would in practice virtually eliminate Newfoundland from any assistance from Ottawa. My request could be met by adding the word hydro in case there is any reason why you must use the word thermal. I would greatly appreciate your complying with this request. Kindest regards,
J. R. Smallwood
A reply was sent acknowledging receipt of the telegram and containing these additional words explaining the position of the government:
I am asking my colleague the Minister of Northern Affairs and National Resources to look into this matter and get in touch with you. I know that he will be glad to see what can be done to bring Newfoundland clearly within the terms of the proposed agreements.



R.C.A.F. STATION, SUMMERSIDE, P.E.I.- HANGAR CONSTRUCTION

Mr. Pickersgill: 1.	Has a decision been taken to construct new hangars at the Royal Canadian Air Force air station at Summerside, Prince Edward Island?
2.	If so, on what date was the decision taken?


Hon. G. R. Pearkes (Minister of National Defence):: Mr. Speaker, the hon. member for Bonavista-Twillingate has asked whether a decision has been taken to construct new hangars at the Royal Canadian Air Force station at Summerside, Prince Edward Island. The hon. member for Prince has also sent me notice of his intention to ask a similar question on the orders of the day today. Perhaps I might answer the two questions together.
A decision has now been reached to construct a cantilever hangar, a readiness hangar and an anti-corrosion hangar at Summerside, P.E.I., R.C.A.F. station, in order to house the new Argus aircraft.


Mr. A. W. Stuart (Charlotte):: Mr. Speaker, I just want to draw the attention of the Minister of National Defence to a question which I have had on the order paper for several weeks, very similar to the ones to which he has just replied. I was wondering when I could get an answer.


George Randolph Pearkes: I appreciate the interest taken by the hon. member in this subject, but as a decision was reached only this week and there was no opportunity to answer questions yesterday, he will understand why he did not receive an answer before this.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Howard: 1.	Has any money been paid by the government to air line companies for mail carrying purposes?
2.	If so, (a) what schedule of rates apply to each company [DOT] by route? (b) upon what dates did the present respective schedules become effective? (c) were any schedules of rates, different than those presently in effect, applicable to the respective companies prior to the time referred to in (b) above? (d) if the answer to (c) above is in the affirmative, upon what dates did the various previous respective schedules become effective and what were the respective schedules by routes?
3.	What has been the total amount of money to date paid to each air line company which has received any money for carrying mail?


Mr. Hamilton (Notre Dame de Grace):: Return tabled.


GOVERNMENT RADIO AND T.V. PROGRAMS AND ANNOUNCEMENTS
Mr. Hansell: 1. To date in 1957 has any department of the government and crown corporations, other than the C.B.C., sponsored any radio and T.V. programs and spot announcements over C.B.C. and independent stations?
2 If so, for each department or corporation, what are the (a) radio programs (b) T.V. programs: (c) the nature of the spot announcements?
3.	What is the cost of each program and spot announcements?



VETERANS HOSPITALS


Mr. Herridge: 1.	Have any immigrants been admitted to, or received any form of treatment or services in hospitals of the Department of Veterans Affairs, between December 1, 1956 and December 1, 1957? If so, how many?
2.	What was the total amount charged for these services to the Department of Citizenship and Immigration, or any other department?



PUBLIC SERVICE EMPLOYEES, B.C.

Mr. Hahn: How many civil servants, and in what departments, are employed in New Westminster, Clover-dale, White Rock, Ladner, Langley, Douglas port of entry, British Columbia?



TRANSLATIONS

Mr. Fisher: 1.	How many translators of Russian are there in (a) the bureau for translations: (b) in other government services, by departments?
2.	What percentage of translations let out to outside translation services is classified for security reasons?
3.	What is the average time from receipt of request for translation to the completion and return of the translated material?
4.	What was the backlog of translation requests as of December 18, 1957?



PRINTING BUREAU


Mr. Fisher: 1.	Were any orders for outside printing placed by the Queen's printer in the financial year ending March 31, 1957? If so, to what value and in what provinces?
2.	If outside printing orders were placed, were any placed without any competitive bids being received? If so, to what firms, for what amounts?



ALLEGED DUMPING OF SUPPLIES FROM VENEZUELA

[Stage Direction]
On the orders of the day:
Mr. M. J. Coldwell (Roseiown-Biggar):: Mr,
Speaker, may I direct a question to the Minister of Trade and Commerce or to the Prime Minister. Will the government inquire into the alleged dumping of Venezuelan oil into Canada and the charges made by church authorities and trade union leaders that the Venezuelan dictatorship and international oil companies are cruelly exploiting the working people of that country? Does the government consider this fair and proper competition with prairie oil?


Gordon Minto Churchill: I will take notice of that question, Mr. Speaker.



INQUIRY AS TO SALE TO AUSTRALIA

[Stage Direction]
On the orders of the day:
Mr. Louis Lewry (Moose Jaw-Lake Centre):: Mr. Speaker, can the Minister of Trade and Commerce advise this house what arrangements have now been made to supply Canadian wheat to Australia?


Gordon Minto Churchill: My hon. friend is quite rightly interested in the Australian situation. When he originally asked me about the crop failure in Australia I thought he was aware of the fact that Australia is one of the four great exporters of wheat in the world, and that they would know what to do in a case of emergency. Australia has a sufficient amount of wheat to feed its own population, but perhaps not sufficient to maintain overseas markets. We are ready to sell wheat to Australia whenever Australia makes a bid to buy. The Australian people are just as capable of dealing in wheat as anybody in Canada, and they quite likely know what they want to do. We have the wheat, and if they want to buy it we are ready to sell it.


Major James William Coldwell: Does the minister expect to get an order from Australia? I heard him on "Press Conference'' last night, and I thought that was the implication of his reply to one of the questions.
Inquiries of the Ministry


Gordon Minto Churchill: Australia, I think, will buy some Canadian wheat. If we were placed in a similar position I think we would buy wheat. I am just waiting for Australia to order some Canadian wheat.


Lester Bowles Pearson: May I ask the minister a supplementary question. Does he consider this to be an aggressive sales policy?


Gordon Minto Churchill: Mr. Speaker, it is not a
question of sending Canadian wheat salesmen to Australia. I have pointed out that Australia has been in the wheat business for years and is one of the great exporters. They know all about the wheat business. They know we have wheat. We are quite familiar with their shortage at the present time. The offer is there, if any country wants to buy.


Mr. Knowles (Winnipeg North Centre):: Just like the wait and see Liberals.


Hazen Robert Argue: Did the Canadian wheat board or some agency of government not approach Australia after a minister of the government of that country made an announcement that they were in the market for Canadian wheat?


Gordon Minto Churchill: That perhaps has been done; I do not follow the day to day operations of the Canadian wheat board. They are certainly very active, and I am sure have been in consultation with Australia.


Mr. L. E. Cardiff (Huron):: I should like to direct a question to the Minister of Trade and Commerce. Is it not true that the wheat board has been much more aggressive under the new government than it was under the old one?


Some hon. Members:: Oh, oh.


Gordon Minto Churchill: Very definitely.


Major James William Coldwell: May I ask a supplementary question. Are we to infer that the wheat board is governed by the stripe of government we have in power?


Gordon Minto Churchill: I am sorry, but I did not hear the question.


Major James William Coldwell: From the Conservative
whip's question are we to infer that the wheat board's activities are governed by the government we have in power in this country rather than by the interests of the wheat growers? I do not think that inference should be allowed to remain on the record, because it is incorrect.


Gordon Minto Churchill: I do not think it was intended that such inference should be made.


Stanley Howard Knowles: What was the intention?

Inquiries of the Ministry


Mr. Speaker:: Order. I do not think this question, which sounded more like a dialogue than a question, should be pursued by way of supplementary questions. It should not have been asked in the first place.


Louis Harrington Lewry: May I ask the Minister
of Trade and Commerce a question in view of his answer to my question in connection with the sale of Canadian wheat to Australia. In view of the fact that the Canadian government has already sent a delegation to buy from other countries, would they now consider sending a similar delegation to sell to other countries?


Gordon Minto Churchill: We are quite prepared to sell at any time to other countries, and we have trade commissioners active in a great many countries throughout the world encouraging sales of Canadian products. The question of selling wheat to Australia is similar to offering Canadian wheat to the United States of America or to the Argentine, which are also great wheat producers. It seems to me that is in a somewhat different category.


Mr. Speaker:: I think we have pursued far enough this morning sales of wheat to Australia. The next thing we know we will be carrying coals to Newcastle.



FREIGHT RATES


[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, yesterday the hon.
member for Assiniboia asked me a question regarding when it might be expected that the inquiry into the equalization of freight rates might be completed.
The board of transport commissioners has advised me as follows. The inquiry into the equalization of freight rates cannot be completed within a few months. The complicated freight rate structure of Canada includes millions of freight rates, and when the matter of equalization was before the parliamentary committee dealing with the proposed legislation, implementing recommendations of the Turgeon royal commission on transportation in 1951, evidence was given that it would take approximately five years to complete equalization. That estimate was in fact too low.
The board has proceeded to deal with the task of equalization as rapidly as possible, but since 1951 it has had a very heavy volume of work including a series of applications by the railways for freight rate increases.
The task of equalizing the "class" or maximum rates was accomplished and put

into effect on March 1, 1955, and the board then proceeded to deal with the lower rates on various bulk commodities, some of which have been dealt with to a conclusion. The board issued an extensive judgment in respect of these commodities in September last, and is proceeding with further hearings as expeditiously as possible. It has set down for hearing at Vancouver on March 3 next the equalization of rates on fruits, vegetables and lumber and a further hearing at Kelowna on March 10, and hearings at Calgary and Regina later in March respecting rates on coal.
In addition, the board has ordered the railways to submit equalized scales on cement, pulpwood, wood pulp and paper articles on or before March 31. Seventy-eight other scales have been ordered for revision on or before June 30. There are, however, many more rates to be dealt with.
The board submitted an interim report on equalization to his excellency the governor general in council in March, 1955, and a further report dated September 23, 1957. These reports gave details of the board's activities in connection with equalization of freight rates and indicated what progress had been made.


Hazen Robert Argue: Mr. Speaker, I wonder if I might ask a supplementary question concerning the equalization of freight rates. Could the minister inform the house as to when the board may be able to make another progress report representing another step forward? Second, is he able to ascertain what the board's target date is for completion of this very important inquiry?


George Harris Hees: Mr. Speaker, I will speak to the board and secure the further information sought by the hon. member.


Hazen Robert Argue: I wonder if the minister-I am sure he would-will impress on the board the great importance of this inquiry and the necessity of having it completed as quickly as possible?


George Harris Hees: Mr. Speaker, the board have informed me that they are so impressed.



AIR TRANSPORT


[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, I would like to answer the questions asked yesterday by the hon. member for Kootenay East and the hon. member

for Winnipeg North Centre regarding a meeting held between representatives of my department and the association of flight engineers.
Representatives of the association of flight engineers met with officials of the civil aviation branch of my department last week to present a brief dealing with the carriage of flight engineers on the large commercial turbine-powered transport aircraft that will be coming into service in the next few years. This matter has been under investigation during the past several months by both my operating and engineering air officials and for this reason the brief was welcomed. Additional study and consultation with the air lines and aviation industry will be necessary before we reach a decision as to the requirements that should be established.


Stanley Howard Knowles: Mr. Speaker, may I direct a supplementary question to the Minister of Transport. Has he ascertained whether it is correct that the DC-8's being built for Trans-Canada Air Lines are being built in such a way that there will not be room in the cockpit for a flight engineer? If this is the case will he consider having this change in construction delayed until a decision has been made on the issue itself?


George Harris Hees: Mr. Speaker, I have no indication that that is the case, but I will be glad to check on the matter for the hon. member.



STATEMENT ON INVESTIGATION INTO HELICOPTER CRASH

[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, yesterday the hon. member for Laurier asked me a supplementary question regarding the setting up of a board of inquiry to inquire into the very unfortunate crash of a helicopter last week. The technical board of inquiry into the accident to a departmental helicopter was set up in accordance with standard departmental practice in these matters, which provides for immediate technical investigation in these cases. The authority stems from the general authority vested in the minister under the Aeronautics Act and there are no special regulations dealing with this particular accident, although the general air regulations as approved by the governor in council, P.C. 1954/1821, and published in the Canada Gazette, with which the hon. member is doubtless familiar, contain certain sections relating to the reporting and investigation of accidents.
Inquiries of the Ministry BUSINESS OF THE HOUSE



REQUESTS FOR ANSWERS TO QUESTIONS ON ORDER PAPER

[Stage Direction]
On the orders of the day:
['Mr. Speaker, I have had no intimation recently as to when it is expected the report will be completed, but when the royal commission concluded its sittings two months ago the chairman indicated that they would prepare and submit their report as soon as possible.']
Hon. Jean Lesage (Monimagny-L'Islei):: Mr. Speaker, may I ask the Minister of Northern Affairs and National Resources if he would have a look at question 92, which has been on the order paper since October 29, and let me know at his convenience when he expects to give a reply?


Francis Alvin George Hamilton: I shall look into that, Mr. Speaker.


Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, to correct my abysmal ignorance and because I like asking questions of ladies I should like to direct a question to the Secretary of State.


Mr. Fulton:: Don't give her a superman task.


Herbert Wilfred Herridge: Why has it taken from December 7 until today to decide that question No. 285 in my name requires to be made an order for return?


Hon. Ellen L. Fairclough (Secretary of State):: Mr. Speaker, I am sure the hon. member knows that his questions are so profound that they necessarily take longer than most.



[Stage Direction]
On the orders of the day:
Mr. Colin Cameron (Nanaimo):: Mr. Speaker, I have a question for the Secretary of State. On November 27 the hon. lady moved to have a question of mine made an order for return, question No. 197. I have not yet seen that it has been tabled, and I wonder if she could tell me when that is likely to be done.


Ellen Louks Fairclough: Mr. Speaker, I shall inquire into it immediately.


LABOUR CONDITIONS
[Stage Direction]
On the orders of the day:
Mr. Claude Ellis (Regina City):: Mr. Speaker, I should like to direct a question to the Minister of Labour. What action has the government taken or does it intend to take with respect to protests made by the non-operating railroad unions on the appointment of Charles P. McTague as chairman of the conciliation board to deal with the dispute between the railroads and the non-operating unions?


DOMINION-PROVINCIAL RELATIONS
[Stage Direction]
Inquiries of the Ministry
Hon. Michael Starr (Minister of Labour):: Mr. Speaker, this matter is under consideration and no decision has been reached as yet.


CONSTRUCTION AND IMPROVEMENT OP CAMP AND PICNIC AREAS TO PROVIDE EMPLOYMENT
[Stage Direction]
On the orders of the day:
Francis Alvin George Hamilton: Mr. Speaker, yesterday the hon. member for Comox-Alberni asked me a question about seaside parks for boating tourists, and I should like to make a reply at this time. The offer made to the provincial governments was for federal assistance toward the construction of camp grounds and picnic grounds. In the letter which was sent to the provincial premiers on January 2 it was made clear that these camp grounds and picnic grounds could be constructed at any point within the province, provided that the provincial government owned the land on which the developments were constructed.
The choice of location is, therefore, left to the good judgment of the provinces, and I have no doubt that any provincial government participating in the program would proceed with work on those developments which would be of maximum assistance to the tourist industry. There would be no objection on the part of the federal government if the government of the province of British Columbia decided that work should be done under the program toward the development of camp grounds or picnic grounds which would serve boating tourists.


CIVIL DEFENCE
[Stage Direction]
On the orders of the day:
Mr. Claude Richardson (Si. Lawrence-St. George):: Mr. Speaker, may I direct a question to the Minister of National Health and Welfare. Having particularly in mind the electric power failure in Montreal last Monday evening, would the minister consider giving at an early date a statement in respect of civil defence in Montreal?


Hon. J. W. Monleith (Minister of National Health and Welfare):: Mr. Speaker, as the hon.
member possibly knows, civil defence has been most inactive in Montreal. I might mention that the deputy co-ordinator, General Hatton, had a recent conversation with Mayor Fournier of Montreal, taking into consideration all aspects of the matter.


NEWFOUNDLAND
[Stage Direction]
On the orders of the day:
Mr. L. T. Slick (Triniiy-Concepiion):: Mr. Speaker, I should like to direct a question to the Minister of Finance. When does the government expect to receive the report of the royal commission on the revision of the terms of union between Newfoundland and Canada?


Donald Methuen Fleming: Mr. Speaker, I have had no intimation recently as to when it is expected the report will be completed, but when the royal commission concluded its sittings two months ago the chairman indicated that they would prepare and submit their report as soon as possible.



SHIPPING


[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, I should like to
reply to a question asked me yesterday by the hon. member for Iles-de-la-Madeleine. Yesterday the hon. member referred to the statement I made in the house on November 7 regarding assistance to shipping the Department of Transport planned to extend this winter in the lower St. Lawrence by way of icebreaking, and mentioned that at that time he had asked if the work could be extended to the Magdalen islands. The hon. member added that he had not heard from me since then and suggested I should look up Hansard to refresh my memory.
I have done this and find that the hon. member did make such a request, but if he in turn will be good enough to look up Hansard he will find that I replied as follows:
Plans for icebreaking in the lower St. Lawrence are now under consideration, but have not been put in final form as yet.
It seemed to me there was an implication in the hon. member's question yesterday that I had neglected to give him an answer, but it is quite clear from Hansard that there was no intimation on my part that there would be a further reply in the house. Perhaps I should add that the hon. member wrote me a letter dated November 7 reminding me of his question and expressing the hope that when the icebreaking services for the north shore were being organized the Magdalen islands would not be forgotten. He will recall that I acknowledged his letter under date of November 13, assuring him that I had taken

good note of his representations and that I would draw his request to the attention of my officials. This, of course, I did at that time.
Our icebreaking operations are carried out at the request of shipping companies, and we have as yet received no request for icebreaking this year in the vicinity of the Magdalen islands. When such requests are received from shipping companies we will meet them to the very best of our ability.



NATIONAL PARKS


[Stage Direction]
On the orders of the day:
Francis Alvin George Hamilton: Mr. Speaker, I should like to say a word or two in answer to the question asked yesterday by the hon. member for Burnaby-Coquitlam requesting the federal government to reopen negotiations with the government of British Columbia to make a national park out of Garibaldi park. Garibaldi park is provincial land, and it would hardly be proper for the federal government to make any suggestion to the government of British Columbia that the land be turned over to the federal government for use as a national park. If at any time the government of British Columbia wished to suggest such a step, the government of Canada would of course be prepared to give the proposal careful consideration.



CASH ADVANCES FOR FARMERS RENTING

[Stage Direction]
On the orders of the day:
Mr. H. A. Bryson (Humboldi-Melfori):: Mr. Speaker, I should like to direct a question to the Minister of Trade and Commerce involving the repetition of a question I asked some time ago. I imagine that by this time he has had representations from farm organizations drawing his attention to the problem. Will the government consider amending either the cash advance legislation or the Canadian Wheat Board Act in such a way that farmers who rent land may be able to obtain cash advances on the acreage they cultivate?


Mr. Speaker:: I am not certain whether that question should be asked. It seems to me that the house has already dealt with the matter of cash advances.


Major James William Coldwell: Mr. Speaker, may I say that I took up this matter with the minister, and he was good
Inquiries of the Ministry enough to say that if enough requests were made the matter would be reconsidered. With respect, I think the question should be allowed.


Gordon Minto Churchill: Mr. Speaker, I may say that some representations have been made to me regarding the difficulty of renters getting landlords' signatures in order to make it possible for the renters to obtain cash advances. I pointed out in a communication to the hon. member for Rosetown-Biggar that I had not received many such protests, but naturally if difficulties are caused and hardships result we will have to give serious consideration to the problem. At the moment I am not sure how extensive the alleged hardship is or to what extent arrangements can be made at this time to ease the problem, but I am quite prepared to give it consideration.


Hugh Alexander Bryson: Has the minister had any representations from farm organizations in regard to this question?


Gordon Minto Churchill: Not that I can recall. I have heard from individual farmers and perhaps some local has sent in a letter; but when you speak of farm organizations, I have not heard from the large farm organizations on this particular problem.


Alexander Malcolm Nicholson: I wonder if the minister received representations from the rural municipality of Porcupine setting out this problem? My attention has been drawn to a case where a death has taken place and the executors have refused to sign a release, so the farmer who is renting the land is not able to get a cash advance on his own property.



AIRPORTS


[Stage Direction]
On the orders of the day:
Mr. Samuel Boulanger (Drummond-Arthabaska):: Has the Minister of Transport
received a request from the city of Drum-mondville for a grant to improve the airport? If so, is the minister in a position to give a favourable answer to this request, which I strongly support and which is anxiously desired by the entire population of Drummond-ville?


George Harris Hees: Mr. Speaker, I have not yet received such a communication, but I shall keep an eye open for it.
2988	HOUSE OF
Inquiries of the Ministry PUBLIC SERVICE



REQUEST FOR STATEMENT ON DISMISSAL OF J. GEORGE NEUSPIEL

[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Secretary of State. Is the hon. lady in a position to answer my question of yesterday regarding the case of Mr. J. George Neuspiel? In view of the fact that he has been reinstated without any impairment of his position, could we now be told what were the reasons for his dismissal?


Ellen Louks Fairclough: Mr. Speaker, this has been a most complicated problem, and the whole case and the policy involved is presently under review. I am sorry to say that I cannot make a statement until that review is completed.



HIGHWAYS


[Stage Direction]
On the orders of the day:
Mr. M. A. Hardie (Mackenzie River):: should like to direct a question to either the Minister of Northern Affairs and National Resources or the Minister of Public Works. Is it true that the department has invited bids on a cost-plus management fee basis for the clearing of the Mackenzie highway between Fort Providence and Fort Rae in the Northwest Territories? If so, will the minister see to it that all available local equipment and manpower will be utilized before either are brought in from the province of Alberta?


Francis Alvin George Hamilton: The answer to the first part of the question is yes. The answer to the second part of the question is that I shall have to take it under consideration because of the fact that we are trying to get this work started by January 15, which makes it imperative to move at high speed. I will take the matter up with the department to see what we can do. I want to assure the hon. member that one of the conditions of these tenders was that the government of Canada would have the choice as to the source of the labour supply.


Mervyn Arthur Hardie: What about the supply of equipment?


Francis Alvin George Hamilton: That is the part I have to take under consideration.
[Mr. Hees.l



FISHERIES


[Stage Direction]
On the orders of the day:
Colin Cameron: Has the
Minister of Fisheries received representations from the fishermen's union on the Pacific coast or the fishing companies that the bounty on dogfish be reinstituted? If so, can he tell us when that bounty will be reinstituted?


Hon. J. A. MacLean (Minister of Fisheries):: Mr. Speaker, a question on this matter was asked in the house some time ago. I did receive a request from the united fishermen and allied workers' union that such a bounty should be reinstated. I then made a reply in the house to that effect and stated what the position was. As yet, at any rate, no further requests have been received.



PRAIRIE FARM ASSISTANCE


[Stage Direction]
On the orders of the day:
Mr. John Charlton (Parliameniary Assistani to the Minister of Agriculture):: Mr. Speaker, in reply to the question directed to the Acting Minister of Agriculture yesterday by the hon. member for Yorkton, I may say that at December 31 payments totalling $1,095,149 had been made to 4,231 farmers in western Canada under the Prairie Farm Assistance Act. It is expected that the balance of first payments will have been made before the end of this month except in the Peace river block. As hon. members are aware, severe weather conditions delayed harvesting in this area and also made inspection difficult. However, it is hoped to complete inspections within the next few weeks, and it is expected that first payments will be made in this area shortly thereafter.



HEALTH INSURANCE


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Minister of National Health and Welfare. Since the time the house recessed at Christmas, have any agreements been signed with any of the provinces under the provisions of the Hospital Insurance and Diagnostic Services Act, or have any other steps been taken to bring about an early implementation of that act?


Jay Waldo Monteith: No agreements have been signed, but further steps and correspondence have taken place between some provinces and the federal authorities.


Stanley Howard Knowles: supplementary question, Mr. Speaker. Could the minister say what steps have been taken? What are the steps to which he referred?


Jay Waldo Monteith: Discussions as to clarification of the terms of the regulations.


Stanley Howard Knowles: May
I ask the minister whether a decision has yet been made as to the date when the act will be brought into effect?


Jay Waldo Monteith: No, Mr. Speaker.



POST OFFICE DEPARTMENT


[Stage Direction]
On the orders of the day:
Hon. Howard C. Green (Minister of Public Works):: Mr. Speaker, yesterday the hon. member for Timmins asked the Postmaster General the following question which bounced off to me:
Is the minister aware that the postal department has been involved in the infringement of two municipal by-laws in Burlington, Ontario, in regard to rented premises, as to which it is reported charges are to be laid? If so, is he in a position now to give the house any details on this matter?
The answer is that the Department of Public Works in providing a total of 2,025 square feet of temporary basement rented space for the Post Office Department located at 208 and 210 Brant street in Burlington, Ontario. Leases have not been signed as yet, but departmental approval has been given.
To date there is no correspondence on record to the effect that charges are to be laid against the crown for the infringement of two municipal by-laws in Burlington. However, the district architect's office advised by telephone this morning that (a) the owners have infringed on the municipal by-laws to the effect that they neglected to take out a building permit when altering the premises for occupancy; (b) neglected at that time to instal an emergency exit to satisfy the fire regulations as laid down by the municipal by-laws. This is reported to have been done now to the satisfaction of all concerned.
It will be seen from the above that if there is any infringement of city by-laws, it is by the owner of the building and not by the department.
Beechwood Power Project Loan POWER



AUTHORIZATION OF LOAN OF $30 MILLION TO PROVINCE OF NEW BRUNSWICK

Donald Methuen Fleming: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to authorize the Minister of Finance to make loans, out of the consolidated revenue fund, to the government of New Brunswick, not exceeding thirty million dollars, in respect of expenditures for the development of hydro-electric power at Beechwood on the St. John river.
Motion agreed to and the house went into committee, Mr. Courtemanche in the chair.


Donald Methuen Fleming: Mr. Chairman, the bill to be founded on this resolution will authorize the government to make a loan to the government of New Brunswick in an amount not exceeding $30 million to cover the cost of constructing the Beechwood hydroelectric development on the St. John river.
May I remind the house that this resolution deals with a particular matter, that of assisting the province of New Brunswick in financing a specific and a very important project. There is another resolution on the order paper which my colleague the Minister of Northern Affairs and National Resources will be introducing very shortly-indeed, it is the next item of business following the present resolution-which deals with the broader questions of the generation of electrical energy in the Atlantic provinces. May I express the hope that in this debate hon. members will address their attention to this Beechwood financing problem and if I may so request, reserve their views on the more general power problems of the Atlantic provinces until the other resolution and bill are before us.
The development of the power potential of the St. John river is not a new idea. As far back as 1910 the international joint commission undertook certain studies of its potential power resources, and a hydro-electric plant was built at Grand Falls shortly after the first world war. This power plant is privately owned. In line with the policy adopted by other provinces, the government of New Brunswick has for many years followed the policy of developing electrical energy by public ownership through the New Brunswick electric power commission.
Some nine years ago, that is early in 1949, the then premier of New Brunswick, foreseeing the growing need for expanded sources of energy, asked the federal government to invite the United States to join with it in requesting the international joint commission to make more detailed studies of the St. John river basin. In due course this work was


Jean Lesage: Mr. Chairman, I do not know if it will be possible to grant the request of the Minister of Finance to proceed with second reading of the bill later today. It will depend upon the answers I get to a number of questions I intend to ask at this time.
The Minister of Finance has just said that the government of which he is a member has subscribed to the principle of special economic assistance to the Atlantic provinces. This is nothing new; the previous government subscribed a long time ago to that principle and has given evidence of its good faith in the matter. The Minister of Finance in his short resume has tried to convey the impression that the government of which he is a member is now doing something which the previous government had refused to do-


Some hon. Members:: Hear, hear.


Jean Lesage: -which is not the case, as I will show very clearly when I go in more detail over the history of Beechwood.


An hon. Member:: Did you bring some department files with you?


Jean Lesage: I have some sessional papers, and whenever you want to talk about departmental files I am ready for you. However,
I am going to quote from these sessional papers, which will prove that the previous government never received the kind of request from the government of New Brunswick for assistance in respect to Beechwood with the conditions outlined by the Prime Minister the other day and by the Minister of Finance today.
On April 27, 1953, the government of New Brunswick presented to the government of Canada a brief on the need for financial assistance to develop the hydroelectric power resources of the St. John river. The request
Beechwood Power Project Loan of the government of New Brunswick was outlined on pages 5 and 6 of the brief as follows:
That the federal government advance to the province of New Brunswick the cost of developing the Beechwood hydroelectric power generating station, with projects incidental thereto. Estimated cost to 1960, $44,400,000.
Which is much more than $30 million.
That the funds be interest free or, if this should prove to be impossible, that the interest rate be 2\ per cent and interest free during construction.
And finally:
That repayments be made at the rate of 1.5 per cent of the principal amount each year,-
That is a 66-year period, not an 8-year period.
-the first payment to be due one year after the completion of the particular project for which the money was advanced.
The government of New Brunswick then projected the following development for Beechwood, and I will quote from page 3 of the brief:
The initial installation at Beechwood would be two 45,000 H.P. units, which is feasible on a run of river basis. The second step would be the development of 600,000 acre feet of storage in the upper reaches of the river. The completion of this storage development would be followed by the installation of a third unit at Beechwood together with the necessary transmission facilities.
The estimate of the cost of the two first units was at that time $24,200,000. Between 1953 and 1955 the program of the government of New Brunswick was amended, substantially changed, and in January, 1956, the government of New Brunswick presented a new brief to the government of Canada on the need for federal financial assistance for the development of electric power. The proposals of the New Brunswick government can be found on pages 16 and 17 of the brief, and I quote:
The government of New Brunswick urges that the government of Canada assist it in developing the electric generating capacity which will be required for a rapidly expanding New Brunswick economy. It requests the federal government to consider the following alternative proposals:
(1) The government of Canada to advance to the government of New Brunswick the necessary capital for the development of the hydro power of the St. John river basin. The rate of interest to be that prevailing on long term government of Canada bonds. Funds to be advanced for each project as they are required for the load of the New Brunswick electric power commission, and as it proves to be economically feasible as compared with alternative sources of power.
The estimate of the funds which would be required up to March 31,	1967, is

The alternative to that proposal was the following:
The government of Canada to advance to the government of New Brunswick the funds required

Beechwood Power Project Loan for the projected construction program of the New Brunswick electric power commission through to March 31, 1967, the rate of interest to he that prevailing on long term government of Canada bonds. Funds required are estimated at $211,094,000.
In the second brief there was no direct proposal as to the annual rate of capital reimbursement, but the rate of depreciation was the same as in the first brief, 1.5 per cent a year over a period of 66 years.


Mr. Brooks:: May I ask the hon. member a question? In the first brief did not Premier Flemming state that "the above", namely the 1.5 per cent repayment and the term of payment "has been set down on a basis for discussion only, and of course we will be glad to consider financial assistance in any form possible by your government"? That was the statement he made.


Jean Lesage: On what page of the brief was that?


Alfred Johnson Brooks: It was not in the brief. It was in a letter to the Prime Minister of Canada sent with the brief.


Jean Lesage: At that time?


Alfred Johnson Brooks: At that time.


Jean Lesage: What was the date of that letter?


Alfred Johnson Brooks: The date was in September, 1953, the same year as the brief.


Jean Lesage: Would the minister be willing to table that letter?


Alfred Johnson Brooks: Well, I am sure the hon. member has the letter.


Jean Lesage: I do not have the letter.


Mr. Van Horne:: He has it. He has them all, he said.


Jean Lesage: I never said I had all letters. That is contrary to the facts, and the hon. member for Restigouche-Madawaska had much better study his own problems than try to smear hon. members of this house.


John (Jack) Henry Horner: Did the hon. member not say in this house time after time that the reason for refusing help for Beechwood was that New Brunswick was sufficiently well off as not to warrant assistance from the federal government?


An hon. Member:: Why don't you attend a session of parliament occasionally?


John (Jack) Henry Horner: Now you are trying to whitewash your own inactivity.


Alfred Johnson Brooks: The date of that letter, since the hon. member asked for it, is September 11, 1953, and it is directed to Right Hon.

Louis St. Laurent, Prime Minister of Canada, from the premier of New Brunswick, Hon. Hugh John Flemming.


Jean Lesage: Would the minister be prepared to table that letter?


Alfred Johnson Brooks: Yes.


Jean Lesage: The hon. gentleman knows that in 1956, as I said, the estimate of the cost of the two first units at Beechwood had risen to $29,200,000. The construction program of the power commission according to both briefs, was based on providing storage in the upper reaches of the St. John river and its tributaries, and the installation of a third unit in Beechwood.
As time went on the possibilities of such storage were examined. It was not possible to reach an agreement with the province of Quebec or the state of Maine to have storage in either territory. A survey was made of the possibilities of storage on the Tobique river in New Brunswick at the ledges. On March 14 of this year the premier of New Brunswick sent me a report which he had received from the New Brunswick electric power commission, and I wish to quote the following from the report:
With an interest rate of 3.5 per cent the total estimated annual cost of the Ledges site would be $321,750 as compared with a total annual benefit of $320,500. It must be noted of course that practically all the annual cost of a storage project is the carrying charges on the capital investment.
Until cheaper money is available than is now the case, or until the shape of the load duration curve of the commission changes from that which is anticipated by 1959 to 1960, it will be necessary to alter the long-range program of the commission by excluding storage facilities, which are predominately dependent upon investment charges in their annual cost structure, and which will not produce required capacity at a cheaper cost than equivalent thermal generation. It would seem that this observation would be applicable to any of the St. John river storages unless interest rates on capital required for their construction was considerably reduced.


John (Jack) Henry Horner: Would the hon. member permit a question? Is he now trying to deny that the answer given on each and every occasion when an appeal was made for help for Beechwood was that New Brunswick was sufficiently well off as not to warrant a loan from the federal government for the project?


Jean Lesage: If the hon. member will quietly and patiently listen to what I have to say and to the details I am putting on Hansard he will understand, if he uses his intelligence.


John (Jack) Henry Horner: Will the hon. member permit another question? I am asking him very simply if he is trying to make some excuse now for forgetting what was said in this house, when time after time he himself gave

the answer that the only reason help was refused for Beechwood was that New Brunswick did not require any help.


Jean Lesage: The previous government never refused a loan to the province of New Brunswick for the Beechwood project on the terms which are offered by the present government.


Mr. Morris:: Mr. Chairman-


An hon. Member:: Sit down.


Jean Lesage: I hope, Mr. Chairman, that my time will not be cut short.


Edmund Leverett Morris: My patient consideration of the hon. member's remarks will be assisted if he will kindly inform us as to the date of the letter he has just read in part and also the full salutation; whether it was addressed to him as a private member or in his former capacity as minister.


Jean Lesage: What was the last part of that question?


Edmund Leverett Morris: I simply asked for information. I wish to know the date of the letter and whether it was addressed to the hon. member in his private capacity as a government supporter or in his previous political capacity.


Leonard T. Stick: If you listen to the speech you will get your information.


Mr. Byrne:: Keep quiet and you will get the information.


Mr. MacEachen:: Stand up.


Jean Lesage: This is a copy of a report by the New Brunswick electric power commission signed by Mr. J. L. Feeney, chief engineer, and addressed to Hon. Edgar Fournier, chairman of the New Brunswick electric power commission. It was sent by Mr. Fournier to Mr. Flemming on March 11 and was sent to me by Mr. Flemming on March 14. This was tabled as sessional paper No. 213 on Tuesday, April 9, 1957, on motion of the hon. member for Gloucester.


Edmund Leverett Morris: I thank the hon. member for that information.


Mr. Murphy (Westmorland):: Now, would you like to know about unemployment in Halifax?


Edmund Leverett Morris: I would be delighted to know about it any time.


Henry Joseph Murphy: I do not
imagine you know what is going on down there at any time.


Jean Lesage: Since water storage was not possible at that time to firm up the power at Beechwood, thermal plants would eventually have had to be used for that purpose.
Beechwood Power Project Loan The previous government would not only have financed but would have built such thermal installations.
It will have been noted that the demands of the government of New Brunswick to the previous government in 1953 were for nearly $45 million without interest or with a maximum interest of 2J per cent at the highest, and in 1956 for loans of either $90 million or $211 million, reimbursable over a period of 66 years.


Alfred Johnson Brooks: But the point that was brought out at that time, as the hon. member for Restigouche-Madawaska stated very well, was that the federal government took the attitude that no matter what the provincial government asked for the province was capable of paying the cost. That is exactly what the federal government was saying.


Mr. Chevrier:: Mr. Chairman, on a point of order, I suggest to you with deference that we should have some order in this committee in the discussion of the matter that is now before us.


Andrew Wesley Stuart: Not closure.


Lionel Chevrier: It is the privilege of
any hon. member in this committee to rise and ask the hon. member who is speaking for permission to ask a question, but that has not been done. The hon. members who have interrupted have not asked permission but have proceeded to make speeches, and I think that is contrary to the rules of the house.


John (Jack) Henry Horner: I asked permission.


Lionel Chevrier: The minister has also proceeded in that manner.


Alfred Johnson Brooks: I must object to that.


Mr. Pickersgill:: Sit down. This is a point of order.


Lionel Chevrier: I submit to you with deference, sir, that this debate should be allowed to continue in the ordinary and normal manner.


Alfred Johnson Brooks: On the point of order, Mr. Chairman, I definitely asked the hon. member-


John Whitney Pickersgill: But you did not ask a question.


Alfred Johnson Brooks: Yes, I asked a question.


John (Jack) Henry Horner: So did I.


Alfred Johnson Brooks: I asked permission and obtained it from the hon. member by his sitting down at the time. I do not know about the others.


John (Jack) Henry Horner: So did we all.

Beechwood Power Project Loan


Stanley Howard Knowles: We
are in committee of the whole, where members can speak as often as they want for 30 minutes at a time, so what is all the fuss about?


Leonard T. Stick: The interruptions that have occurred.


Stanley Howard Knowles: Start in again and take 30 minutes.


Jean Lesage: Perhaps, Mr. Chairman, if I were to leave the past history and come to the present resolution it might have the effect of quieting the spirits and minds of hon. gentlemen on the other side.


Mr. MacEwan:: It is doubtful.


Jean Lesage: 
important not only in the present instance but also in other cases for determining future guidance and policy.
Surely one of the most important factors must be the cost of power to the consumers. Of course there will be a reduction, though we do not know what kind of reduction. I would like the minister to tell the committee what will be the reduction which will benefit the consumers because of this loan. I would also like to know what will be the cost of energy from Beechwood, the first two units, delivered to load centre substations in mills per kilowatt hour.
On January 3 of this year the Minister of Northern Affairs and National Resources answered a somewhat similar question asked by the hon. member for Inverness-Richmond. The answer of the minister as recorded at page 2831 of Hansard of that date was as follows:
1. Assuming a production of 300 million k.w.h. annually and a borrowing rate of 6 per cent on the $29 million, the cost of power produced by the present Beechwood plant would be of the order of 7 to 7.5 mills per k.w.h.
One matter to which I wish to draw the attention of the Minister of Northern Affairs and National Resources immediately is that he used the figure 300 million kilowatt hours which would be sold, of course, whereas in the second brief presented to me in 1956 by the premier of New Brunswick, as found at page 34, the following figure was used.
The average annual kilowatt hours available- 355 million.
In a dry year, as the minister knows very well, this would be very substantially decreased. I do not understand why the figure 300 million kilowatt hours annually would have been used by the minister, so basing his answer on a load factor of about 85 per cent, when the report of Montreal Engineering tabled in the house by the Minister of Northern Affairs and National Resources on November 14, I believe, mentioned an average load factor for the maritimes of 50 per cent.
I should like the Minister of Northern Affairs and National Resources to revise his figures by using the real figures which should be the basis of the calculations, that is to say an average of approximately 180 million kilowatt hours in a year. The second part of his answer to the hon. member for Inverness-Richmond, based on the figure of 300 million kilowatt hours-


Donald Methuen Fleming: Does my hon. friend not think that the questions he is pursuing now could be asked to better advantage on the second resolution rather than on the present one?


Jean Lesage: No, I am talking about the cost of power at Beechwood. I am talking about the output of the first two units at Beechwood, and it is only with respect to the first two units that the loan of $29 million to $30 million is proposed. I am not talking at all about the other resolution which has to do with the establishment of thermal plants and transmission lines for interconnecting purposes in the Atlantic provinces. I am dealing strictly with the two units at Beechwood, and the output of 300 million kilowatt hours applies only to the first two units. My remarks bear only on the Beechwood project. The second part of the answer was:
This cost could be reduced by approximately 1.2 mills per k.w.h. by loans from the federal government at a lower interest rate.
First of all, I believe that 1.2 mills is too high because of the reason I have just given, as to the load factor. There is also another reason. It would seem that the federal rate has been used for the whole depreciation period, while it should have been used only for eight years. After the period of eight years the province will have to supply the money at its own rate of interest, so the federal rate of interest should not be used as a basis for calculation of depreciation for the whole period of depreciation but only for the eight years.
I should like to ask the Minister of Northern Affairs and National Resources to request his officials, between now and second reading of the bill, to make the calculations again and prepare an answer to the question of the hon. member for Inverness-Richmond based on the true facts, that is to say the federal rate of interest only for eight years and an annual use or sale of 180 million kilowatt hours which, according to the report of Montreal Engineering, would be the average use in a year.


Francis Alvin George Hamilton: Did you use
the figure of 30 years?


Jean Lesage: I did not use any such figure.


Francis Alvin George Hamilton: No, but did you
ask me to use 30 years?


Jean Lesage: No. This is not thermal plants or transmission lines. There is no doubt that the depreciation period on water power installations is much longer than on thermal plants.


Francis Alvin George Hamilton: What time do you suggest?


Jean Lesage: I suggest the time suggested by the government of New Brunswick, 66 years at 1.5 per cent per year.
While I am dealing with the cost of the power to be produced at Beechwood I should like to ask the minister what his opinion 96698-190
Beechwood Power Project Loan is as to the economics of the problem. For instance, how will the cost of energy from Beechwood compare with that of energy to be developed through the large modern thermal plants to be built under government policy, taking into account the difference in the depreciation period between the two, the load factor and also what I am about to say? Without storage facilities, to which I referred a few moments ago, the two Beechwood units will be operated on a run of the river basis. Yet the flow of the Saint John river varies greatly from season to season. To what extent will the annual curve of production of power coincide with the curve in the load factor?
That is very important in determining the economics of any project. Surely the peak of power generation at Beechwood does not occur at the same time as the peak load. In order to know if this is really as good a case as was put forward by the Prime Minister, we should have some information as to how much it will cost to build and operate the thermal plants which will be necessary to meet the load at all times of the year.


Alfred Johnson Brooks: Your government said it was a good proposition.


Jean Lesage: Yes, but I want to know about the economics. I want to know what will be the cost of power from Beechwood to the consumers of New Brunswick. I have here all the calculations of cost based on the proposals of New Brunswick, but I do not have the calculations of cost based on the conditions of the loan put forward by the Minister of Finance now, which are completely different; and I am not an engineer.


Alfred Johnson Brooks: That is quite evident.


Jean Lesage: I have to rely on the figures I find in documents in this house. I should like to know how much power will be lost at the time of peak flow. I submit that the committee is entitled to a full and detailed report on the economics of the Beechwood project in the light of the proposal made in the resolution.
Before resuming my seat I wish to refer to a statement made by the Minister of Agriculture on November 20 in his capacity as Acting Minister of Northern Affairs and National Resources. I thought it was to be found on page 1333 of Hansard of November 20, but I cannot find the quotation. The minister said, in any event, that the first two units of the Beechwood project were 90 per cent completed at that time. To return to the question I mentioned a few moments ago, asked

Beechwood Power Project Loan by the hon. member for Bonavista-Twillin-gate, part 4 of that question, as found at page 1405 of Hansard of November 22, was in these words:
Are such loans-
Similar loans as in the case of Beechwood. -available only for new or uncompleted projects or will they be available for refunding obligations of established power projects in the Atlantic provinces?
At that time the Prime Minister answered that they would not be available for refunding obligations. I should like to know how much of this loan will be available to New Brunswick for refunding, that is to say how much of the project will have been completed on April 1 when the government advances the first money on the loan? How much will be for refunding purposes?


Donald Methuen Fleming: All the project will have been completed, because the resolution assumes that the cost will have to be ascertained. As I mentioned in my statement this morning, that is expected to be known shortly and it is at that time that the province will take down the loan.


Jean Lesage: Therefore I have to conclude that the whole of the loan will be for refunding purposes.


Donald Methuen Fleming: No, not for refunding at all.


John Whitney Pickersgill: Where does the money
come from in the meantime?


Donald Methuen Fleming: The obligations incurred by the province of New Brunswick-


Jean Lesage: Will be refunded.


Donald Methuen Fleming: No, they have not been funded. That is not the state of these obligations at the present time.


Jean Lesage: So we should interpret the answer of the Prime Minister to the hon. member for Bonavista-Twillingate in the light of the statement of the Minister of Finance now that reimbursing a bank is not refunding.


Donald Methuen Fleming: Refunding has a very definite and well accepted meaning, and I think my hon. friend is aware of it.


John Whitney Pickersgill: I do not have the hon. gentleman's advantage, so perhaps the Minister of Finance would define it for me.


The Chairman:: The hon. member for Peace River.


John Whitney Pickersgill: My question was a serious one, Mr. Chairman.


Donald Methuen Fleming: Very well; I shall deal with these questions in due course.


Mr. Low:: I listened with keen interest to the short statement made by the minister in introducing this resolution. I have listened also with very keen interest to the statement made by the hon. member for Montmagny-L'lslet. He very properly raised the questions he did concerning the soundness of this proposition. After all, if we are to be fair all around with our provinces and with the money that properly belongs to the people of Canada, we must know that when advances are to be made out of the consolidated revenue fund the proposition is sound, and there is a good chance that the province to which the loan is made will be able to pay it back.
I have listed a number of questions which were asked by the hon. member for Mont-magny-L'Islet, and I will repeat them and ask the ministers concerned, before the second reading of the bill, to give us answers to these questions. In the first place, let me assure the minister and the committee that we believe that at times it is necessary for the federal treasury to come to the assistance of provinces in order to ensure the proper development of the resources of those provinces. We do know that the province of New Brunswick has had a depressed economy for some years; that has been quite clear. They have required help, and there is no doubt about that. We have been, in our group, sympathetic to whatever help could be granted to New Brunswick so they could get a proper development; because we realize that unless they have power down there, and sufficient power, they cannot proceed to industrialize to any degree.
One of the things they need above all others is industry in order to ensure employment for their people and the fullest measure of development of their resources. We know also, of course, that New Brunswick has had to operate on a comparatively small budget every year. When you compare it with the budgets of some other provinces of Canada it looks almost infinitesimal. How in the world they carry on with that small amount of money is sometimes a mystery. However, they do. I say we must be sympathetic to their requests for whatever help can be granted. Under the circumstances of confederation and what confederation did to the Atlantic provinces, including New Brunswick, I believe the government of Canada owes them some assistance; that is the position we take.
Having said that, the question arises in my mind as to whether Beechwood is the kind of project that ought to be proceeded with in preference, let us say, to thermal power development units that have been projected

there for some years and which could use the abundant shales that are in the province. We have heard about these shales for years. Nobody, to my knowledge, has been able to obtain all the facts for the house regarding these shales and whether it would be possible to develop enough power for the needs of the people of New Brunswick through the use of these shales in thermal power units.


Donald Methuen Fleming: I wonder if the hon. member would permit me to interrupt. I take it he is aware of the fact that this Beechwood project is in being, and it is not now a case of an alternative choice between it and some other power development.


Alfred Johnson Brooks: I wonder if I might bring everybody up to date. Beechwood has been in operation now for three weeks, and is supplying power.


Solon Earl Low: I understand that, but we are still considering-*


Jean Lesage: Is it not a trial run?


Alfred Johnson Brooks: It is supplying power now.


Stanley Howard Knowles: Does anybody know what the situation is?


Solon Earl Low: In any event, we know the Beechwood project has been completed and is in operation. However, I am also mindful of the fact that we are being asked in this parliament today to give favourable consideration to a loan from the consolidated revenue fund of this country in the amount of $30 million in order to refund to the province, or to the banks who have financed the project thus far, the moneys they have advanced. We do feel, therefore, that we are entitled to the facts, and all the facts. Along with the hon. member for Montmagny-L'lslet I should like to know if sufficient investigation has been carried out to ascertain whether or not the amount of power available through the Beechwood project is such as to justify the cost. That certainly is important and fundamental.
Have careful inquiries been made to find out whether the possible amount of power available to the people through Beechwood not only would justify the cost but would be equal to what they could provide through thermal units at a similar cost? It seems to me that is fundamental to this whole case. It seems to me that we ought to have also the actual cost of the development of power reduced to mills based on realistic load factors, and not this basis of 85 per cent or 90 per cent. If a realistic load factor is, let us say, 55 per cent or 50 per cent, then we should have a break-down of the actual cost in mills of the development of that power 96698-190J
Beechwood. Power Project Loan based on that figure. Certainly there is a tremendous spread between the estimated 300 million kilowatt hours annually at a cost of 7 mills per kilowatt hour and, let us say, 180 million kilowatt hours per year at a much greater cost. I think the minister ought to be able to give us these figures and, perhaps before we go on too far with the bill, to present this break-down to us.
Now, provided it is a sound project and can be justified, certainly I would be putting no stumbling block in the way of this loan to New Brunswick. After all is said and done, we want to see the fullest measure of development of the resources within the provinces. New Brunswick is one of the provinces that need assistance, and in order that we can give them that assistance I believe the minister ought to give us the facts requested by the hon. member for Montmagny-L'Islet.


Andrew Wesley Stuart: Mr. Chairman, all the members from New Brunswick have been waiting for some time for this matter to come before the house in order to express their views. It is quite apparent also that there has been quite a bit of heat generated as the result of members on one side of the house not agreeing with those on the other side. I believe this matter has been a political football for a long, long time. I believe the facts should be brought to light, and I hope in my humble way to be able to do that very thing.
I am going back a little in the history of power development in New Brunswick. A major part of the electric power development in New Brunswick has taken place within my memory; in fact in my own home town of St. Andrews we have only enjoyed this necessary service since 1920. In that year a little company composed of citizens of that town was formed, electrical energy was purchased from the Canadian Pacific Railway through their facilities at the Algonquin hotel. It was steam-generated power. We paid for that service in the little town from which I come at 16 cents per kilowatt hour plus a $1 a month service charge. We also found it necessary to pay for the meter that measured the energy.
That was my first experience with the cost of electrical energy in the province of New Brunswick. After two or three years it was determined that some cheaper source of power must be found, and for a few years we were serviced from the Canadian Cotton Mills in Milltown. That power was sent over the St. Croix river by an underwater cable to St. Andrews and we were serviced in that way. Later on it was taken over by the New Brunswick power commission.

Beechwood Power Project Loan
The first development we enjoyed in New Brunswick in so far as water power is concerned took place at Musquash in Saint John county. That was a very successful development. It has been in operation, I would say, for 27 or 28 years. It has been a great convenience and has meant a great deal to the people of the province of New Brunswick. That project was sponsored and built by a Liberal government for this purpose. They wanted to be able to provide electrical energy for the citizens of our province at cost. As I have pointed out, prior to that time the cost of electrical energy in that province was prohibitive. There were many appliances we wished to have in our homes but which we just could not have on account of the cost of energy.
That same government, namely the Liberal government, went ahead with plans for a much larger development at Grand Falls, which is well known to the Liberal members of this house here. There is no doubt in my mind that Grand Falls was the greatest water development in the maritime provinces. Arrangements and agreements had been completed with the province of Quebec and the state of Maine for storage facilities away back in 1925. With those storage facilities we could have produced 300,000 horsepower at Grand Falls, much more power than is being developed at Beechwood.
Tenders had been called to go ahead with the work prior to the election of 1925. When the election came the Liberal government was defeated, and the late J. B. M. Baxter formed a Tory government in our province. What happened? He immediately withdrew those tenders that had been called, and sold our birthright at Grand Falls to the Gatineau Power Company.


Alfred Johnson Brooks: That is just nonsense, and you know it.


Mr.   Siuari@Charlotte: My hon. friend who says that is just nonsense was a member of the government when this was done. If Beechwood is such a wonderful idea for New Brunswick today, why was not Grand Falls in 1925?


Alfred Johnson Brooks: The only large industry we have had in New Brunswick came as a result of Grand Falls.


Andrew Wesley Stuart: I did not intend to get rough here today, but if there is too much interruption there are a good many things I can put on the record in connection with Beechwood that I think my hon. friends do not want me to put on.


Alfred Johnson Brooks: Go ahead.


Andrew Wesley Stuart: If I am needled I will put them on the record. The hon. gentleman who interrupted me was a member of

the government of New Brunswick in 1925 when they sold our birthright which would have provided twice the power that we can ever hope to get from Beechwood. It could have been developed then for $10 million. That was the estimated cost at that time, $10 million for 300,000 horsepower. But our Tory premier, the late J. B. M. Baxter, sold it to the Gatineau Power Company. We had no development in the way of power during the time the Conservative government was in power. No effort was made to develop power. In 1935 we changed that government, and from that time until 1952 there was a great improvement.


Mr. Bell (Saint John-Albert):: What a
joke.


Andrew Wesley Stuart: Let me tell my
friend the hon. member for Saint John-Albert that his friends who have supported him over the years in Saint .John took every ounce they could take out of the Saint John people for years and years in the cost of electricity, until the Liberal government took over the provision of electrical energy to the city of Saint John. If he does not know that I can tell him now. I could give him the names of those who for years bled the people of his own city blind and dry with the cost of electrical energy. It was a Liberal government that took over in Saint John city to get the people from underneath that load.


Thomas Miller Bell: On a question of privilege, Mr. Chairman, may I say that the facilities in Saint John city are owned by the Saint John civic hydro commission, which has no connection whatsoever with the provincial government.


Andrew Wesley Stuart: I do not question
that; but until the New Brunswick hydro electric commission took over, their rates remained up in Saint John.


Thomas Miller Bell: Just a moment ago you said the Liberal government took over the facilities in Saint John.


Andrew Wesley Stuart: They set the rate.
You were being robbed and they set the rate for you, which is a well known fact all over the province of New Brunswick.
There has been one problem for all Liberal members from New Brunswick in this house. They have been accused of being greatly opposed to the Beechwood project. I have expressed my views on other occasions, and I hope to be able to express them here today. There is a misunderstanding so far as the difference of opinion is concerned. I am going right back now to 1952, which was the year the government of New Brunswick was changed and Hon. Hugh John Flemming

became premier. In the budget debate of that year just prior to the election Hon. J. B. M. Baxter had this to say and I want to put this on the record to show to what degree the Liberals in New Brunswick have always felt that storage rights meant a great deal to this development on the Saint John river. This is our friend Premier McNair-


Thomas Miller Bell: Excuse me
again, but the hon. member just said that J. B. M. Baxter said something in 1952 and he died in 1946.


Andrew Wesley Stuart: I did not say anything of the kind. I said that in 1926 he sold our birthright.


Stanley Howard Knowles: Many Tories speak after they are dead.


Andrew Wesley Stuart: It was in 1926 that Baxter sold our birthright. If I made any mistakes about the date I will correct it now. Speaking in the budget debate in 1952, this is what J. B. McNair had to say.


An hon. Member:: One o'clock.


Lewis Elston Cardiff: The hon. member will speak
better on a full stomach.


Andrew Wesley Stuart: I do not know
about a full stomach, but if my hon. friend would sit and listen and not to try to apply Tory closure we might get on with this debate in an orderly way.


Lewis Elston Cardiff: I was not trying to apply
closure.


Andrew Wesley Stuart: This Tory closure
does not affect me. I am going to say what I want to say whether you like it or not. You might as well sit still and take it as sit there yakking for an hour or an hour and a half.


An hon. Member:: One o'clock.


Andrew Wesley Stuart: May I call it one
o'clock?
At one o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 2.30 p.m.
Andrew Wesley Stuart: Mr. Chairman, in speaking before one o'clock there were two statements I made which were, I know, believed to be incorrect by two hon. members sitting on the other side of the house. I referred to the New Brunswick hydroelectric power commission taking over the electrical system in Saint John city. I have checked since I left the chamber at one o'clock, and I find that the New Brunswick electric power
Beechwood Power Project Loan commission did take over what is known as the New Brunswick power company, the producing company in Saint John, and today only that producing company distributes power. It is owned and controlled by the New Brunswick electrical power commission.
I also stated that between 1930 and 1935 no improvements had been made in the way of power development in New Brunswick. I find that during that period one plant was built at Minto, New Brunswick in 1933, and I also find that the highest cost power produced in New Brunswick comes from that plant. The latest figure I have is 22 mills.
I stated earlier today that those who sit on this side of the house and who come from New Brunswick have always maintained and still maintain that Beechwood would never provide a stable source of power until storage rights had been secured. This stand that has been taken over the years was based on information which we were able to obtain from those who were qualified to give it. I know the former premier of New Brunswick was very very much convinced that storage rights were necessary. One of the main sources of information we have had in New Brunswick was the late Gaspard Boucher, who was at one time chairman of the hydro company. He gave me these same views; and in order that there may be no misunderstanding I should like to put on the record a statement made in the budget debate in the provincial legislature at Fredericton in 1952, just previous to the provincial election of that year. In speaking in that debate Hon. J. B. McNair had this to say:
It was upwards of six years ago that fresh studies were launched to determine the power potential of the Saint John river. These were initiated through the New Brunswick resources development board. As a result of its work we early became convinced that, in addition to others the merits of which have long been considered debateable, there are two potential sites capable of economic development. These are the sites at Morrill and just above Beechwood enumerated in this house by my friend opposite a few weeks ago.
Our studies have been predicated upon the assumption that storage is vital to any development. We know too. as he said in his speech, that sections of the river constituting boundary waters as well as tributaries, outside this province would be involved. We have also been aware that heavy expenditures would be involved in any development program.
It seemed to us necessary to enlist interest and support elsewhere if any plans were to be developed for the effective harnessing of the power of the Saint John river system.
. . . On December 8, 1948, I wrote the Prime Minister of Canada requesting the co-operation of the Canadian government and that steps be taken to refer to the international joint commission the study of the power potential of the Saint John

Beechwood Power Project Loan river system and means to make it effective. I feel it desirable that this letter should also be read into the records of this house. It is as follows:
Then here is the letter sent by Hon. J. B. McNair to the Prime Minister of Canada at that time.
In New Brunswick as elsewhere in Canada the demand for electric energy is increasing at an unprecedented rate. For some years efforts have been made by our publicly owned electric power commission to meet the needs in this province by additions to its coal steam generating system and in certain areas by the temporary and costly expedient of installing diesel units to meet pressing local shortages of supply. During the past few years certain surveys and studies of sites where hydro-electric energy might be economically produced, have been carried on. In these we have had the assistance of such engineering firms of the Power Corporation of Canada and H. G. Acres and Company.
During these investigations consideration has been given to further hydro-electna development on the Saint John river, the largest of the rivers of the maritime provinces. As you may know, about 20 years ago a hydro-electric plant was established at Grand Falls which is presently owned and operated by the Gatineau Power Company. Apart from this there are other sites, possibly three, farther down the river which may lend themselves to development. One of them is now receiving intensive study and appears very promising. However, any such development is rendered problematical due to lack of storage and regulation of flow, factors very material to steady energy production throughout the year.
The history of the Grand Falls plant, which primarily supplies the newsprint mill of the International Paper Company at Dalhousie, has shown a drop during the winter season from its designed and installed capacity of 80,000 H.P. to an output of 20,000 H.P. or less. Any new installation on the river would be subject to similar winter and late summer or early autumn fluctuations in production.
The solution of this problem lies in the provision of storage in the headwaters of the Saint John river. These lie chiefly in the state of Maine and in the province of Quebec. Available statistics show that the drainage area of the Saint John river above Grand Falls is about equally divided between Maine and Quebec with approximately 4,500 square miles in each jurisdiction.
It was of interest to us to note that the newly reorganized international joint commission is now giving study to various boundary water questions. It would seem that the time is opportune to seek its assistance and intervention in connection with the hydro-electric potential of the Saint John river. It is obvious that apart from other possibilities there is storage of considerable magnitude available on the St. Francis river, one of its tributaries. This river rises in Quebec and for a portion of its course forms the boundary between Maine and Quebec and then becomes the boundary between Maine and New Brunswick. In these boundary waters are to be found three lakes known as Glasier, Cross and Beau lakes which constitute wide stretches in the river which should lend themselves to storage works and if developed would afford most helpful storage during periods of low water supply for any present or future development on the Saint John river. It clearly falls within the jurisdiction of the international joint commission.
In every part of that speech made in the budget debate by Hon. John B. McNair he
[Mr. Stuart (Charlottel-1
outlined in every detail the absolute necessity of storage rights on the St. John river before stable power could ever be produced. That was the attitude that was taken 20 years ago, and it is the attitude that is taken today. Nevertheless it was decided by the provincial government of New Brunswick to go ahead with that project without storage rights.
To confirm the ideas that have been expressed by Liberal members of this house I should now like to put on the record a statement by one who is very closely connected with the New Brunswick power commission, Dr. Rowley. In his 1955 report which was published and put out by the provincial government of New Brunswick, Dr. Rowley, director of the research branch of the New Brunswick resources development board, had this to say:
Until large water storages are constructed In the upper reaches of the Saint John river watershed in Maine and Quebec, such firm or continuous power will not be available from sites that might be developed on the main river. With ample water flowing, as during the spring run-offs and with rainy autumn periods, Beechwood will afford periods of firmness in supply. The smaller winter and summer flows will afford energy for some hours each day only to care for peaks when system demand is high. Consequently new sources of continuous power must be afforded and these are most likely to be steam plants burning that fuel which will most effectively yield power at the lowest cost.
No stronger support could be given to the stand taken by Mr. J. B. McNair in New Brunswick than that statement by Dr. Rowley. I have been convinced for many years that Beechwood would never be economically sound, would never provide stable and dependable power, until those storage rights had been secured, and I believe that idea has today taken form in the minds of many people in New Brunswick. It is for that reason that on many occasions when I have spoken on this matter I have been accused of opposition for political reasons. But that would not greatly affect the people in my province, because they know that the whole issue has been shrouded in politics for years and years.
It was the belief of many people in New Brunswick that this development should never have been taken out of its international setting; that we should have gone ahead by obtaining those storage rights, and in that way we could have been supplied with dependable power from Beechwood. You must have dependable power before you can interest those who might come to the area and establish industries. You cannot attract industry when you have low power during one part of the year and high power at another period.

Now, Mr. Chairman, I want to get on to the submission made to the government in 1953 by the premier of our province, and I am going to quote his own words. They are as follows:
The cost of power from the Beeehwood site would, of course, be determined by the rate at which the capital to construct the hydro power installation could be borrowed. If the province were forced to borrow at the present market rate of approximately 5 per cent, the estimated cost of delivered energy in mills per k.w.h. would be 6.92.


Donald Methuen Fleming: Would the hon. member tell us the date of that letter?


Andrew Wesley Stuart: The date of this letter is April, 1953.
However, if the commission could borrow the capital funds from the federal government at 2J per cent, the estimated cost would only be 4.76 mills per k.w.h. If the federal government would advance the funds, free of interest, the estimated cost would be driven down to 2.61 mills per k.w.h.


Jean Lesage: That is three units, not two.


Andrew Wesley Stuart: 
The Deputy Chairman:: Order. I am sorry to interrupt the hon. member, but I am obliged to advise him that his time has expired.


Thomas Miller Bell: Mr. Chairman, now that the hon. member has completed his remarks I wonder if I may be permitted to place on the record the final qualification paragraph that the Minister of Veterans Affairs also interjected into the speech of the hon. member for Montmagny-L'lslet.


Arza Clair Casselman: Is it the hon. member's intention to make a speech now?


Thomas Miller Bell: Well, we are in committee, Mr. Chairman, and I merely wish to place this on the record to achieve continuity.


Arza Clair Casselman: I appreciate the hon. gentleman's remarks, but on the other hand arrangements have been made under which someone else has the floor at the present time. I would suggest that the hon. gentleman should wait and do this later, if it would meet the same purpose.


Thomas Miller Bell: I understood, Mr. Chairman, that it was customary not to interrupt the speech of an hon. member but that following his speech a correction could be pointed out. I feel it is quite important that it be done at this time in order to provide continuity in Hansard.


Arza Clair Casselman: Does the hon.
gentleman wish to ask a question?


Thomas Miller Bell: Yes, Mr. Chairman. May I ask the hon. member for Charlotte if he is not aware that following these four proposals made to the federal government by Premier Flemming of New Brunswick he also put in a qualifying paragraph which reads:
The above-
Beechwood Power Project Loan
-proposals-
-have been set down as a basis for discussion only. Of course we will be glad to consider financial assistance in any form deemed possible by your government.


Andrew Wesley Stuart: Well, Mr. Chairman,
I believe that provides an opportunity for me to finish my remarks, since I am on my feet.


Mr. Maclnnis:: You had to have it pointed out to you. Someone else gave you an assist on that one.


Andrew Wesley Stuart: I have not seen that correspondence, and I do not believe it was in the brief submitted to the federal government. I believe it is contained in a letter.


Thomas Miller Bell: Is the hon. member not aware that these records were tabled in this house?


Jean Lesage: What is the date of the letter?


Thomas Miller Bell: Is he not
aware that sessional paper No. 219 would uncover that whole matter; and if he was speaking with authority on this subject, as he purported to have done, would he not agree that he should read all the correspondence and the complete record?


Andrew Wesley Stuart: 
Arza Clair Casselman: I think the hon. gentlemen have now had enough extra time on this point.


Andrew Wesley Stuart: With all due deference, Mr. Chairman, I believe that once a question has been asked I can assume the floor again and speak for another half hour in committee.


Arza Clair Casselman: The hon. member has already spoken for half an hour.


Andrew Wesley Stuart: I believe that in committee I am entitled to speak for another half hour, though it would not take me that long.
3004	HOUSE OF
Beechwood Power Project Loan


Arza Clair Casselman: The hon. member may do that if he wishes, but he has already spoken for half an hour and it is not fair to the other hon. members.


Andrew Wesley Stuart: That is perfectly all right with me. I can take another half hour later.


Donald MacInnis: If you have enough material.


Andrew Wesley Stuart: I may tell my hon. friend that I do not need any material of his. I do not need any material of yours; and any time you think you would like to have an opportunity for you and me to debate it either inside or outside of this house just let me know and I am ready to proceed; yes, any time. Mr. Chairman, may I suggest that the hon. gentleman and I-


Arza Clair Casselman: Order.


Some hon. Members:: Oh, oh.


Arza Clair Casselman: Order. I recognize the hon. member for York-Sunbury.


Mr. MacRae:: In rising to speak in support of this resolution, Mr. Chairman, I wish to express the gratitude of the people of my constituency for a measure which has been hailed not only in the constituency of York-Sunbury but throughout the whole province of New Brunswick. I have no doubt that when the speech from the throne was read by Her Majesty on October 14 and Beech-wood was mentioned, there were many people listening to whom Beechwood was only a name. There are those who think of Beechwood only as a hydroelectric development on the Saint John river 100 miles or so above the capital city of Fredericton, but Beechwood is a great deal more than that. Beechwood is a symbol, an example of the courageous determination of the people of New Brunswick to improve their lot, to improve their standard of living.
A few days ago I was reading a volume on our Atlantic provinces. The harsh first sentence in the chapter on my province was in these words:
New Brunswick is a poverty-stricken land which occasionally sprouts a millionaire.
Those are the words of the author, Mr. Chairman, not mine. New Brunswick was not always a poverty-stricken land. When New Brunswick joined with Nova Scotia and Upper and Lower Canada to form this great nation, it was anything but poverty-stricken. Its lumber was shipped all over the world. Saint John was the second largest shipbuilding port in the world. It traded heavily with the New England states, the West Indies and Europe. As the result of the federal union we lost the valuable United States trade, trade which was never regained.
[Mr. Stuart (Charlotte) .1


Mr. Robichaud:: Mr. Chairman, the resolution before us now has to do with a measure to authorize a loan out of the consolidated revenue fund to the government of New Brunswick, not exceeding $30 million, to cover the full cost of construction of the Beechwood plant. The terms of the loan have been outlined by the Minister of Finance this morning, and the loan is to bear interest of 4| per cent or the current rate of interest of long-term Canadian loans at the time the loan will be made on April 1, and is to be repayable in a period of eight years.
The Canadian people were first informed of the government's decision in this connection when in the speech from the throne the following words were spoken by Her Gracious Majesty the Queen:
You will also be asked to provide assistance in financing the Beechwood project which has been under construction in New Brunswick.


An hon. Member:: What are you reading from?


Hédard-J. Robichaud: I am quoting from the Christmas card circulated by the premier of New Brunswick bearing those words, being an excerpt from the speech from the throne read by Her Majesty the Queen at the opening of parliament in Ottawa on October 14, 1957. The same words are to be found at page 6 of Hansard for that date. It is no wonder, Mr. Chairman, that the hon. member for York-Sunb'ury, when speaking before me, said that before the present government took office Beechwood was only a name but now it is a symbol. No true Canadian ever thought that Beechwood would be used by the premier of New Brunswick, together with
Beechwood Power Project Loan the very words of Her Majesty the Queen, on a Christmas card for political purposes.


Mr. Montgomery:: I rise on a point of order. I think it is unbecoming for a member of this house to state that anybody has used these words for political purposes on a Christmas card.


Hédard-J. Robichaud: Mr. Chairman, it may be more unbecoming for the premier of a province to use such words on a Christmas card.


Arza Clair Casselman: Order. I would call the hon. gentleman's attention to standing order 35, which reads as follows:
No member shall speak disrespectfully of Her Majesty, nor of any of the royal family, nor His Excellency or the person administering the government of Canada; nor use offensive words against either house, or against any member thereof. No member may reflect upon any vote of the house, except for the purpose of moving that such vote be rescinded.
I think it is quite clear that according to the second last sentence of that paragraph, the hon. gentleman is not strictly in order.


Hédard-J. Robichaud: On the point of order-


Jean Lesage: On the point of order, may I submit very respectfully that what the hon. member for Gloucester did was to say that the premier of a province had used a picture and words of Her Majesty for political purposes. It was an accusation against the premier of a province, and I respectfully submit that it had nothing to do with standing order 35.


Arza Clair Casselman: It is an accusation in which the name of the Queen is mentioned, and that cannot be done. No member can use the name of the Queen in debate in the House of Commons.


Jean Lesage: On the contrary, Mr. Chairman, the hon. member for Gloucester was saying that somebody had used the name of Her Majesty in vain.


Hédard-J. Robichaud: Now that the point of order has been cleared up, I hope I can carry on.


Mr. Fraser:: You should apologize.


An hon. Member:: To whom?


Hédard-J. Robichaud: Mr. Chairman, if hon. members want to bring up the question again, I have made reference to the words that were used, and at no time have I made any accusation or reference which was not respectful to Her Majesty the Queen,


Jean Lesage: Quite the contrary.

Beechwood Power Project Loan


Hédard-J. Robichaud: In a statement issued to the press two days later Premier Hugh John Flemming said:
It has been a moving experience to represent New Brunswick in Ottawa during the opening of parliament by Her Majesty, and to hear set forth in the speech from the throne the promise of Her Majesty's government of Canada to assist the Beechwood development and to make further provision for the generation of lower cost power in the Atlantic area.
Further on he makes reference to this generous promise in the speech from the throne, and concludes his statement by saying:
Altogether, the speech from the throne contained news of great and hopeful significance for every man, woman and child in this province.
I realize, Mr. Chairman, that on the government side of the house there is some confusion about the present status of the Beechwood project. This morning, in an interjection, the Minister of Veterans Affairs said that Beechwood had been in operation for three weeks. Amongst the sessional papers which were tabled on January 3 there is a letter dated October 21, 1957 from the Prime Minister of Canada to Hon. Hugh John Flemming, premier of New Brunswick. This letter reads as follows:
My dear Premier:
I wish to send you my congratulations and best wishes on the occasion of the formal opening of the Beechwood hydro development project next Thursday, October 24.
Now, whom are we to believe? This is in a sessional paper which was produced on January 3, amongst all those letters of congratulations from the Prime Minister and other ministers of the cabinet; but the real document which was requested, the proposal of the federal government to the province of New Brunswick, was not tabled.
It is my intention this afternoon to review briefly some of the incidents and discussions relating to federal assistance to electric power development in New Brunswick, leading to this so-called generous reference of such hopeful significance. The interim report of the international joint commission of the United States and Canada on the water resources of the Saint John river basin involving Quebec, Maine and New Brunswick, released on January 27, 1954, included, in conjunction with the Beechwood project on the Saint John river, provision for a 500,000 to 600,000 acre feet reserve storage at sites upstream from Grand Falls, New Brunswick. This would have made possible the prospective increase in normal power demand through 1961, with thermal plants to meet the requirements of extraordinary demands such as may be required by mineral developments in northern New Brunswick. We all

recognize that thermal expansion would be less economical than storage; nevertheless it appears to be the only alternative if storage is not made available in order to increase the total output of the present Beechwood installation by the addition of a third 45,000 horsepower unit, or even to assure the potential electrical output of the present units.
At this point, Mr. Chairman, I may refer to the words of the premier of New Brunswick himself when addressing the New Brunswick legislative assembly on April 14, 1954. He said, and I quote his own words:
All this information has gone to show that the outstanding question in regard to power development is the amount of financial assistance which could be secured by the province in developing the Saint John river. It has already been announced by the hon. chairman-
That is the chairman of the New Brunswick hydro commission.
-that the province, on its own behalf, can and will begin the initial development at Beechwood. However, the great storage projects will require assistance when they are undertaken-assistance which can only come from one source.
In view of these words by the premier of New Brunswick himself I am wondering how the members on the government side can protest the attitude of the previous government on this matter.
We should deduce from this statement by the premier of New Brunswick that the province, on its own behalf, could proceed and decided to proceed with the initial development of Beechwood. The premier stated at the time, and this was less than four years ago, that where assistance was required and where it was expected was for the acquisition and construction of the great storage projects which were needed in order to make the Beechwood operation effective and economical.
In view of this statement by the premier of New Brunswick, and in view of the decision, according to this statement, to proceed with the initial stage of the Beechwood project, which in fact has been now practically completed and is in operation, it is clear that the previous federal government had taken very important decisions concerning this vital question. On January 26, 1956, as reported on page 558 of Hansard for that date, I received a reply from the then minister of northern affairs and national resources which reads in part as follows:
AH the way along there has been a constant exchange of views among provincial and federal technical and financial officials. These discussions appeared to indicate that the development to the end of the Beechwood phase could be carried out by the province of New Brunswick without jeopardizing its credit. It appears, however, that future developments in the province are likely to require additional power on a substantial scale.

This larger future development has been represented to the federal government as likely to be beyond the capacity of the province of New Brunswick to finance on its own.
The previous government was prepared to recognize that the larger future development of the Saint John river was beyond the capacity of New Brunswick to finance on its own, and also to take into consideration the admission by the premier of New Brunswick himself that the present phase of the project, the one which we are discussing today, could be undertaken by the province on its own.
In his budget presentation on March 14 last the former minister of finance outlined a proposal which was offered to Nova Scotia and New Brunswick and which has been referred to by those who have preceded me in this debate. In concluding his remarks the minister stated that notwithstanding his offer, the relatively high cost of electrical power in the Atlantic region as a whole would continue to receive further careful study.
The latest available report on this important subject is the report on the power supply of New Brunswick and Nova Seotia, made for the Northern Canada Power Commission by the Montreal Engineering Company Limited, which was finally tabled in this house a few weeks ago by the Minister of Northern Affairs and National Resources. On page 8 of this report we find this:
The two hydro units now being installed in the Beechwood plant, can be used to good advantage for supplying peak power and secondary energy. Unless storage is developed in the United States or Quebec, the water supply will be inadequate to justify the installation of a third unit in the period under review.
On this very subject of water storage, a day or two ago I came across a statement made by Mr. H. J. Rowley, director of the research board and chairman of the New Brunswick development board, which was included in his 1955 report to the department of industry and development of his province. I feel that this statement by Dr. Rowley, which was quoted in full a few minutes ago by my colleague the hon. member for Charlotte, has a direct bearing on the motion which is now under consideration by this committee. Here is a statement by an expert in this field. Here is a straightforward report which reveals without any doubt that water storage facilities are essential to the economic development or operation of the Beechwood project.
From the statements I have just placed on the record it is obvious that the government would have been well advised to advance money to provide water storage facilities which are essential to the economical operation of Beechwood, rather than share in
Beechwood Power Project Loan financing a project which is already completed and in fact partially in operation. If this is a general policy to be adopted by the government the minister should advise the house accordingly.
Personally I would have preferred to see the government advance money for the storage facilities, which would have contributed to making the Beechwood project not only economically sound but would at the same time have provided employment which is so urgently needed in New Brunswick today. In fact, had the province of New Brunswick financed the project in 1954, when the premier announced that the province could and would proceed on its own with the construction of Beechwood, when loans could be obtained at an interest rate of 3i per cent to 3f per cent, the ratepayers of the province of New Brunswick would have been saved from $250,000 to $300,000 a year in interest alone.
In making his announcement, on November 14 last, part of which I referred to earlier, the Prime Minister stated that the Beechwood plant would provide a substantial block of relatively low cost power. Has the minister today given any indication of the cost of this relatively low cost power for which a loan is asked? Has the Prime Minister, when he made his announcement on November 14 last, or the Minister of Finance when introducing the resolution we are now discussing, given any assurance to this house that relatively low cost power could be produced if this loan were approved?
In the same address to the provincial legislature which I mentioned earlier, on April 14, 1954, the premier of New Brunswick said:
The Conservative party has been the strongest advocate of the storage scheme during recent years.
If they are so strong an advocate of the storage scheme, why are they not asking for the co-operation of the federal government to take care of the 500,000 or 600,000 acre feet storage required to make Beechwood economically sound, and the only way to provide the relatively low cost power which New Brunswick industries are asking for? The construction of storage facilities at this time, when unemployment in New Brunswick has reached an all-time high, would provide work for a large number of our unemployed.
Where is today the news of great and hopeful significance for every man, woman and child in New Brunswick? Is it to be found in the recent curbing actions by the United States government or in the further restrictions which can be expected following the
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Beechwood Power Project Loan bold and arrogant attitude of the present government? Is it to be found in the ever-increasing unemployment which is spreading through New Brunswick and through all Canada today?
The people of Bathurst and of Gloucester county have been seriously shocked by the recent announcement of the curtailment of operations by Brunswick Mining and Smelting Corporation. There is a possibility that lead and zinc are next on the list to be affected by United States import curtailment. Is it not significant that over six months after taking office the present government have not produced a single official note of protest, a single official document having to do with representations to the United States government, asking for postponement of such curbing actions toward imports from a neighbouring and friendly country? No one in New Brunswick, particularly in Gloucester county, can disregard the serious blow to our people and to our economy that will follow the curtailment of mining operations in the Bathurst area.
For the last four years our merchants, our industries and our people had geared and planned their activities on developments which had given new hopes to our depressed areas and which had promised a revolution in our general economy. Investments were made accordingly. New constructions were started, some of which are now completed. New accommodations were provided and Bathurst, conscious of its responsibility, was looking ahead to a future of achievement in material things, of progress in civic affairs, ready to take full advantage of its human resources as well as its new natural resources.
If the present government was prepared to take action to keep in operation the Britannia mines in British Columbia, and if the present government is consistent in its policy to help the Atlantic provinces, why is it not taking action to keep in operation the mining developments in northern New Brunswick? I will have more to say on this subject on resolution No. 11, having to do with assistance in the generation of electrical energy by thermal power projects for the Atlantic provinces.
When normal amortization periods on power plants built by the Northern Canada Power Commission are based on a long term amortization period of 30 years, why is the loan now granted to New Brunswick for the Beechwood project limited to an eight year repayment period? It is only logical to assume that the province of New Brunswick with its declining revenues mainly in the last few months, will not be in a position to repay this loan on the basis of $4 million per year.


In other words, if New Brunswick wants to meet its obligations under this particular loan it may have to borrow at a higher rate of interest. Before this bill is presented the minister should consider very seriously extending the amortization period to conform with the policy in regard to northern power development.
In concluding I wish to quote a brief paragraph from the Atlantic Advocate, a magazine from the maritime provinces which I am sure, through its editor and publisher, is well known to the members on the government side of the house. Before doing so, however, I want to take this opportunity to congratulate the Atlantic Advocate, which won high honour by receiving the annual award of the Canadian tourist association's historical and cultural committee. This, and the public references in speeches and newspapers that followed, have combined to make the first year-end of publishing a happy and rewarding climax. Under the title "Looking a Gift Horse in the Mouth" the editor of the Atlantic Advocate has the following words to say:
For it is a natural and proper reluctance that causes hesitancy to look a gift horse in the mouth. Ingratitude is one of the baser qualities. Yet, whilst we are glad to get acceptance of the principle of adjustment grants to poorer provinces, and grateful for the thermal units, the coal subsidy that goes with them, the grid, and the financing of Beechwood, we must admit to disappointment that the coal subsidy, limited as it is to $1,600,000, will not be sufficient to remove the differential between power prices in the Atlantic area and elsewhere: and the federal financing of Beechwood with interest at 4g per cent and repayment spread over eight years is not the low interest long term financing the province looked for.


Herbert Wilfred Herridge: In view of the fact that on two occasions the present hon. member for Cape Breton South has clearly indicated to this house that he would prefer to settle issues by fisticuffs outside of the house rather than by exhibiting his ability to debate issues inside the house, I suggest that he model his conduct on that of the former member for Cape Breton South who, I think I am safe in saying, had the respect of his colleagues in this house, whose ability was recognized by members of all parties, who on all occasions respected the highest and best traditions of parliamentary procedure, and who always aimed to achieve his ends in strictly Canadian and constitutional ways. In all kindness to the young member I suggest, Mr. Chairman, that in order to become thoroughly housebroken to the days ahead he read very carefully the speeches his predecessor made from 1942 until the dissolution of parliament this year.
This group has remained silent on this resolution to date, Mr. Chairman, because it is quite content to sit here and glow with

pride and satisfaction in the knowledge that this government is following the procedure of the former Liberal government in adopting as policy some segments of C.C.F. policy that have been advocated in this house for many years.
In this resolution the present government is adopting the policy that has been urged by members of this group for many years; that is for a federal government to render financial assistance to a provincial government for the development of hydro resources under public ownership. We are very pleased to see this and we realize it is further evidence-and it happens from day to day- that even governments learn from this little and valiant group on this side of the house, that our policies are substantially sound and that we are effective out of all proportion to our numbers at the present time. I hope the people of Canada in general will recognize these facts at the next election.
I have taken a great deal of interest in the development of hydro resources and in deference to the expressed wishes of the Minister of Finance I am going to defer my remarks with respect to the validity of public ownership for the next resolution, because I do not want to stir him up at this time. I do want to put on record, however, the report which General McNaughton made to the external affairs committee with respect to the Saint John river development of which I understand the Beechwood development is an important part, because I think the member for Charlotte was rather critical of that development. I have the report given by General McNaughton to the external affairs committee, but there were certain questions asked and we do not have a printed copy of the record at this time. I propose now to read from the report on the Saint John river reference, 1950, as amended July 7, 1952, as I think this should be placed on the record:
Again in the maritimes, I would like to report briefly on the Saint John river reference. As I mentioned last year the interim report of the commission dated January 27, 1954 is in the hands of the governments and since that time, we have received annual reports from the engineering board covering subsequent developments in the area.
I am pleased to report that the first two units of New Brunswick's Beechwood power project are now in place and will be in operation shortly. Action is being taken to provide electrical interconnection between New Brunswick and Maine which was recommended in the commission's report. In this respect I recall that on my appearance before this committee last year I was able to report that the state of Maine had repealed the Fernald Act which had prohibited the export of hydro-electric power from that state. Action has since been taken b.y the Department of Trade and Commerce (Canada) and by the United States
Beechwood Power Project Loan
federal power commission to authorize the interconnection and the export of electric energy in the amounts proposed. The amounts are not large in comparison to various blocks of power available in other parts of Canada but under the special conditions of development in the region largely along the two sides of the Saint John river these arrangements should prove of material help in satisfying local needs of the area and we are hopeful that later these arrangements for cooperation may be further extended to the benefit of development in the Saint John river basin both in Canada and in the United States.
I judge from the report of the general and the answers to the questions of that committee that while this whole scheme of development has not come to fruition with respect to the arrangements between Canada and the United States-and to the hydro development this is a very important and worth-while step in this direction-we in this group give wholehearted support to this resolution as providing for a measure that will be of great advantage to the people and to the economy of the province of New Brunswick.


Donald MacInnis: On a question of privilege, Mr. Chairman, it would seem that the last speaker saw fit to rather put me in my place for what has previously taken place here this afternoon. Let me at this time say that when that challenge was hurled at me I made no reply whatsoever. I got up and left my seat and as far as-


Henri Courtemanche: Order. That is not the question. If you have a direct question-


Stanley Howard Knowles: He
has the right to speak.


Henri Courtemanche: I have recognized the hon. member for Victoria-Carleton.


Alfred Johnson Brooks: May I say that I think there was a reflection on the hon. member for Cape Breton South. The hon. member for Kootenay West in speaking said that the hon. member wished to settle these disputes by another manner than debate in the house. As the hon. member said a moment ago, he merely got up and left the chamber and there was no indication on his part that he wished to settle disputes in any other way than by speeches in the house. I think he should be allowed to make that statement now because there was a reflection upon him.


An hon. Member:: The chairman has ruled.


Henri Courtemanche: He should have made that statement just at the time when the point was taken.


An hon. Member:: He was out of the house.


Gage Workman Montgomery: I would like to say a few words in support of this resolution. As a matter of fact I think I would be less than

Beechwood Power Project Loan human if I did not at this time, not only-express my own appreciation for the early recognition by the government of the necessity of helping a small province but also express the appreciation of the people of my constituency because this project happens to be in that constituency. Indeed I might go a step further and say that the people of New Brunswick in general appreciate the action taken by this government in such an early recognition of their needs.
I would like to be fair, but I cannot let pass some remarks made by hon. members today. I am wondering if they are trying to convince the members of this house that this resolution and the legislation which follows it should not be supported. Neither the hon. member for Charlotte nor the hon. member for Gloucester indicated that they were going to support the legislation and I wonder if they are going to do so. Even though it is not as good as they would like to see it, is it so bad that they are going to vote against it? I am sure they have not convinced the members of this house that this project is an unworthy one but I am afraid that the impression is going out from this house, through those members, that it is not an economic, sound or even the type of project which the federal authority should support in a small province like New Brunswick.
If that impression should go out I would feel sorry because I am sure it could do nothing but hurt, not only those members in their own constituencies and in their own provinces but it might give a wrong impression to the rest of Canada as to the outlook we have in New Brunswick. After all, we are pretty solid citizens down there and we do not tackle anything unless we have a pretty good idea that we can carry it out.
The Beechwood project is the largest development that has ever been undertaken by the New Brunswick hydro commission and it was undertaken only after months and months of study and research. I would like, as strongly as I can, to impress upon the members of this house that I think they will find if they will look into the records that the project about to be completed-or that part of it which includes the two units-has been approved by the power corporation, by H. G. Acres and Company Limited and by the chairman of the Canadian section of the international joint commission.
It has been approved, and the New Brunswick hydro commission was given the go ahead for that part of the project as a sound economic development. So all those arguments which strive to indicate that because we cannot at the moment secure the rights from the state of Maine and from

the province of Quebec and settle the great problem of flowage everyone should keep their hands off Beechwood do no good for New Brunswick and no good for Canada.
This present policy is, if I understand it correctly, one of the first steps of the new government in the development of a natural resources policy which this country has so far lacked. All through the negotiations which were carried out between the provinces and the federal authorities there has emerged now and again a very good reason why the federal government did not back the province, and this was because they had no national development policy on which they could justify their claims.
I should like to refer to a letter dated February 3, 1954 from the federal authorities to the comptroller general of the province of New Brunswick in which the deputy minister of finance told the comptroller general:
Confirming our telephone conversation we have, as you know, given long and careful consideration to your proposals regarding federal assistance to the government of New Brunswick in financing the development of hydroelectric power on the Saint John river. I am now directed by my minister to say that he has reviewed this matter with his colleagues, and the conclusion has been reached that it would not be right or proper for the federal government to provide funds by loan or otherwise for the development of natural resources along the lines you suggest.


Jean Lesage: Mark those last words.


Gage Workman Montgomery: I certainly do mark those last words, and I tell the hon. member that the people of New Brunswick have got those last words underlined. If I had wanted to play politics, or try to do anything funny, I would leave them out; that is what hon. members on the other side usually do.
If my hon. friends want to look up Hansard for a few years back they will find it recorded that the former minister of finance, Mr. Abbott, made a statement in this house while sitting on this side of the chamber that it was not the policy of the federal government to finance any project for a provincial authority which they should finance themselves and pay for over a period of years. In other words, that statement was right in line with this letter. There was no federal natural development policy available on the basis of which the government could see their way to giving assistance to a province. Therefore they did not do so. They never provided any assistance in this regard, either to New Brunswick or to any other province. The step which the government is now undertaking is a step toward the development of the type of policy which I believe will, as it unfolds, offer every province a chance when it has a proposition

which is sound economically, feasible of accomplishment and able to pay its way. That is exactly what we have in the Saint John river hydro development at Beechwood today.
This project was begun on June 11, 1955. Before proceeding further I will say that ever since that day the people concerned with the project in New Brunswick, both the federal authorities and the hydro authorities have tried to keep politics out of it. At no time, in my view, have they ever originated the idea of making this a political football. On the occasion of the opening ceremony the federal government was represented by the former minister of trade and commerce, the Right Hon. C. D. Howe. Also present was chairman of the Canadian section of the international joint commission, General McNaughton; officials of the hydro electric authority of the state of Maine, members of the government of the province of New Brunswick and, in addition, distinguished members and leaders of the opposition at that time, along with members of the New Brunswick power commission. All these people took part in this opening ceremony. It was not a political occasion.
Moreover, as I understand it, since 1953 when the new government came into power in New Brunswick the opposition in New Brunswick, which comprised the remnants of the Liberal party, supported this proposal; as far as I know they have never opposed it; it has been non political.
In addition to receiving the support of all these public men, this tremendous undertaking was brought into being at a time when the province was just recovering from a period of financial difficulties which had lasted for several years; I am referring to 1953 and 1954. And if ever a province needed assistance, New Brunswick needed it then. At that time the federal authorities gave encouragement to those in the province with whom they were in contact. They never refused to discuss this question, and that is borne out by all the correspondence which has been conducted between the authorities. The matter was on a basis of discussion, and I do not think any one can deny that discussions were carried on freely. I do not think anyone can deny that the federal authorities encouraged New Brunswick to proceed, as this was a solid project from the economic viewpoint.
However, the federal government always stopped short of saying, "We will back your bonds or supply money at a certain rate of interest," or something of that nature. It stopped short of the financial assistance which
Beechwood Power Project Loan was the final step needed to be taken to help us out. The lack of such backing would have discouraged many public men. Fortunately, however, a new government had recently been put in charge of our affairs in New Brunswick. It was a government of young businessmen who had faith in the future of New Brunswick and who tackled their work with vigour, confident that something could be done for New Brunswick. In addition to that they conveyed that feeling of enthusiasm to the people of the province as has been so ably demonstrated since that time. Thus it was that on June 11, 1955, when the first blast was set off, many thousands of people gathered at Beechwood to watch the opening.
What I am going to say now I say with all sincerity because I was present at that opening and spoke to many of the people who were gathered there. The people who spoke to me expected me to have the answer but I did not and of course the answer they were looking for did not come. The Right Hon. C. D. Howe was present on that occasion which was very encouraging to the people of New Brunswick when they gathered there that afternoon. When they saw the federal minister in attendance they were sure that before the meeting was over he was going to announce that the federal authority had decided to back the project but they went home disappointed. Perhaps they were not justified in their expectations but they did know that negotiations had been proceeding and many of them being supporters of the Liberal government were certain he would make the announcement because it was one of the first and biggest projects New Brunswick had undertaken that would benefit the province as a whole and would assist the future of our mining, lumbering, pulpwood and paper industries.
No announcement was made and so the New Brunswick hydro commission backed by the provincial government went ahead with the project. As you have heard today two units are now operating and the project has become an integral part of the support of our whole economic system, a necessity to the encouragement of mining expansion and the establishment of new industries. I am under the impression that General McNaughton advised the external affairs committee that there has already been a hookup with the hydro system of the state of Maine and this integration is of importance. Nevertheless the completion of this project by no means represents the fulfilment of our hydro development requirements in New Brunswick. I am not going to take time to labour the point because it is generally known and has already been stated by the hon. member for Charlotte that the cost of the development of power from the first thermal plant was extremely high and it

Beechwood Power Project Loan continues that way. In a province like New Brunswick or in any other small province that has very little potential hydroelectric development the cost of thermal electrical development is very expensive, but if you mix the two you can possibly arrive at the best average price. The greatest cost is the initial expenditure and there is the cost of repair and so on but ten years from now the cost may be quite different.
I do not think it is necessary to labour unduly the arguments in support of this resolution. I have been a member of this house for five years and during that time the question of hydro development in New Brunswick has often been discussed. In that period of time I have witnessed a significant change in the attitude of hon. members from other than the Atlantic provinces towards those of us who come from the maritimes. In 1955 and 1956 private members on all sides of the house were speaking on our behalf in an effort to impress on the federal government that the maritimes deserved assistance. Many hon. members who sat or who now sit in these benches came to me and discussed the question of hydro power in New Brunswick and were very sympathetic toward us. Some hon. members are not here today because they have passed on or have fallen by the wayside but their sympathetic attitude lingers after them and I believe the majority of hon. members of this committee today regardless of what province they come from are sympathetic toward us in the maritime provinces. They realize we are backward in our development in some respects and most of them are prepared to support us in trying to bring the standard of living in the Atlantic area in closer relationship to the standards enjoyed in other provinces.
Mention has been made today of the attitude held by some hon. members that the present interest rate is not going to provide cheap power. I do not think I am unfair when I say that if the previous federal government had adopted a policy under which it could have acted it could have backed the province of New Brunswick in 1954 and 1955 when these demands were made. It could have assisted the Beechwood development and financed it at an interest rate much less than the present 4| per cent. At that time the government could have arranged a loan at an interest rate more favourable than the rate under with the government must operate today. I do not think that we in New Brunswick expect the government to lend money to the province today at a cheaper rate of interest than that at which it can borrow but two years ago the federal authority was able to borrow

money at a cheaper rate than is possible today. If negotiations had been concluded and the federal government had come forward and offered a loan at cost plus administrative charges I am sure the interest rate would not have been more than 3i per cent and perhaps not that much and I feel sure that the province of New Brunswick would have gladly entered into an agreement. But the two governments did not seem able to get together.
I do not think it is fair to blame the province of New Brunswick. In all fairness I feel that the fault lay in a lack of policy because from my own experience in the house I believe that many members who supported the government of the day were sympathetic and felt that something should be done. As a matter of fact I have talked with them. Of course it may be the case that a government cannot always put something like this into operation unless it feels it has a sound reason for advancing it. No government had ever been in power so long without having a policy and I suppose the government of the day felt it could not establish a policy for New Brunswick.
On behalf of the people of my constituency and my province I want to say again that we appreciate the fact that the new government has given early recognition to our need. I do not think the government is going to go overboard and give us everything we want, but to me this is the first stepping stone in the development of a policy which will not only help us but will help other provinces as well. I hope that members of the house will support the legislation and I feel that they will.


Allan Joseph MacEachen: Mr. Chairman, the purpose of the resolution is very clear and simple. It will have two effects; first, to reduce the interest obligations of the provincial government of New Brunswick and, second, because of that reduction to reduce the cost of the generation of electricity by the Beechwood project. As the hon. member who has just taken his seat pointed out, during previous sessions a desire has been expressed by members from the Atlantic provinces for policies which would result in the development of cheaper electricity in that area, and we did have a response to that last spring in the budget of Mr. Harris. However, the resolution to follow the present one will provide a better opportunity to compare that proposal and the proposal that will be under discussion.
I find it rather difficult to approach a discussion of the resolution now before us because an examination of the economic

merits of Beechwood cannot lead to anything but futility on the part of the House of Commons inasmuch as we are asked to examine the merits of a project which is now completed and in operation. The House of Commons is asked to share retroactively in the responsibility for a decision taken in 1955 by the government of New Brunswick. At this moment some years later we are asked to share in that responsibility and to approve, as it were, without an opportunity to have any real effect on the decision then made. We have been presented today, Mr. Chairman, with a number of arguments that might have changed that decision if the House of Commons had had the opportunity to pass judgment on them.
For example, the hon. member for Charlotte pointed out that the proper development of Beechwood might and apparently does involve co-operation with the United States and the province of Quebec, and if that is the case then the House of Commons at the time of the origin of the project might have had an opportunity to deal with that matter. We are asked to deal with an omelet that is now presented to us.
However, while that is true it is not the main source of difficulty for me. This resolution having to do with the development of hydro power in the province of New Brunswick is followed on the order paper by another resolution dealing with the development of thermal power in the Atlantic provinces as a whole. One block of electricity is to be developed through hydro power and another block of electricity in the same region is to be developed through the use of coal.
The presentation of these two companion resolutions reveals to me the inconsistent attitude which the government is taking toward the coal industry in the Atlantic provinces. The hon. member who just took his seat asked members of the house to support this resolution and certainly I have given some consideration as to whether I should support the resolution because of the effect which this development will have upon future markets for coal in the province of Nova Scotia.
I am, of course, sympathetic to the development of New Brunswick in any shape or form but I am also conscious of the responsibility which I, as a member from Nova Scotia, have to promote those matters that are of assistance to the coal industry. I should like to know from the Minister of Finance or from the Minister of Northern Affairs and National Resources how many tons of coal would be used annually.


Donald Methuen Fleming: Mr. Chairman, I think my hon. friend will realize he is now entering into the subject matter of the following
Beechwood Power Project Loan resolution. There will be plenty of opportunity to take up any questions pertaining to thermal power on that resolution. It is the next item on today's order paper.


Allan Joseph MacEachen: Mr. Chairman, I understand the point of view of the Minister of Finance but my attitude to the resolution now before us must be based on information which has to do with the alternative production of electricity. I could not, for example, easily support this resolution if the Minister of Northern Affairs and National Resources presented information to the house showing that this electricity could be produced as well and as cheaply from coal. That is the type of information I am seeking from the Minister of Northern Affairs and National Resources. If we are not permitted to discuss alternatives to this particular possibility, then I think the discussion is quite futile.


Donald Methuen Fleming: Perhaps my hon. friend will permit me to suggest this to him. We are on the resolution stage. If in the course of the discussion of the other resolution there are any matters that he thinks are relevant to the debate on second reading of the bill concerning Beechwood, I suggest it is the proper course to raise them then, but I think it is not relevant to the resolution now under discussion to go into the question of the cost of thermal power for the very simple reason that we are not now at the stage of choosing an alternative. As the hon. gentleman has indicated, here is a virtually finished project. It is no longer a question of choosing an alternative. My hon. friend will have the fullest opportunity to ask questions of my colleague, the Minister of Northern Affairs and National Resources, about the development of thermal power on the next resolution to which the subject of thermal power is directly related.


John Whitney Pickersgill: I should like to say a word on the point of order raised by the Minister of Finance. Surely the only purpose of these resolutions preceding money bills is to enable hon. members to make up their minds by hearing debate as to whether or not this is the most suitable way of spending the taxpayers' money or whether some alternative way is more suitable. If the Minister of Finance is seeking to restrict the debate on these resolutions preceding money bills to the strict terms of the resolution and to exclude discussion of alternatives, there is no purpose whatever served by these debates. It seems to me, from all the observations I have made of this house over 20 years and during four years as a member of it, that this is the first time I have ever heard of
3014	HOUSE OF
Beechwood Power Project Loan this new attempt to restrict the debate in committee on a resolution preceding a money bill.


Donald Methuen Fleming: The hon. member's memory must be failing him and I think upon reflection his statement will appear to him to be far from the fact. There are on the order paper today two resolutions. There is the one now under discussion which reads as follows:
That it is expedient to introduce a measure to authorize the Minister of Finance to make loans, out of the consolidated revenue fund, to the government of New Brunswick, not exceeding thirty million dollars, in respect of expenditures for the development of hydroelectric power at Beechwood on the Saint John river.
There is nothing said in that resolution about thermal power. The following resolution, upon which I hope the house will be in committee shortly, does read as follows:
That it is expedient to introduce a measure to authorize the government of Canada to enter into agreements with any of the Atlantic provinces to provide assistance in the generation of electric energy by thermal electric power projects, and in the control and transmission of electric energy, and including provisions for the payment of a subvention on coal used in the production of electric energy.
The purpose of this procedure of having money bills preceded by resolutions considered in committee is to afford hon. members the fullest opportunity to obtain all information relevant to the subjects involved. What I am pointing out to my hon. friend is that the matter upon which he now wishes information is something relevant to the following resolution, and not this one. The proper course for him, if I may say so, Mr. Chairman, is to ask these questions of my colleague the Minister of Northern Affairs and National Resources on the next resolution, and not to ask them of me on this resolution.


John Whitney Pickersgill: If I may just say one more word, I should like to thank the minister for reminding me of the word "expedient". That is precisely the point. What we are trying to do is decide whether it is expedient to do this or not to do it. Surely when the hon. member for Inverness-Richmond says that before he can properly make up his mind he wants to know whether the amount of power produced by Beechwood could be produced more cheaply by coal, he is entitled to know that. The question relates to this resolution and has nothing to do, even remotely, with the other.


Henri Courtemanche: I would suggest that the resolution before the committee deals with the financing of the project. I do not think the production of power through the use of coal comes within the terms of this resolution.


Jean Lesage: May I, with all due respect, ask for a clarification of your ruling? This morning when I discussed this matter I said, and this will be agreed upon by everyone, that the power coming from Beechwood is far from being firm power. At certain times of the year the Saint John river at Beechwood is dry and the power has to be firmed up through the use of thermal power. It is important, in reaching a judgment on the economics of Beechwood as it is now, with two units and without storage, to know what the cost of thermal power will be which will firm up the power at Beechwood. Then, too, we should know what the cost of thermal power would be compared to the cost of hydroelectric power from the two first units at Beechwood.


Donald Methuen Fleming: Mr. Chairman, that is the very sort of information that I think is quite properly relevant to the next resolution.


Jean Lesage: No, to this one.


Donald Methuen Fleming: The next one, Mr. Chairman. My hon. friends should have all the information they require, but surely that kind of information is relevant to the next resolution.


Jean Lesage: On the point of order, Mr. Chairman; I am speaking of the economics of Beechwood itself. I am not talking about the program for thermal plants in the Atlantic provinces, which is the subject of the other resolution. I am talking directly about the economic soundness of having only two units at Beechwood.


John Whitney Pickersgill: And so was the hon. member for Inverness-Richmond.


Allan Joseph MacEachen: I think it would be very difficult, certainly for the members from coal mining areas in the maritime provinces, to discharge their responsibilities on this particular resolution without knowing whether this particular block of power of 3 million kilowatts per annum could be produced as cheaply or more cheaply from coal than from hydro sources.


Alfred Johnson Brooks: I wonder if I could ask the hon. member a question. I am not admitting that the power could be produced cheaper by coal because I do not think it could, but supposing it could, is he suggesting that New Brunswick scrap Beechwood and use coal in producing the amount of power Beechwood would produce? Is that his suggestion?


Allan Joseph MacEachen: No, my desire to get information on this point is not for the purpose of making suggestions to New Brunswick as to what its course of action should be, but to determine what my course of action should be as a member representing a coal mining

Mr. Chairman, and I have never yet seen the chairman of the committee of the whole have to subside in his chair because a member who is reading remarks that are out of order waved his hands at him. I think the hon. member should be told to throw away his text and to make his speech as he should without its aid and to remain within the rules.


Henri Courtemanche: I think the hon. member will follow my observations.


Mr. Coates:: I feel that we in the maritime provinces are entering a new era-


Alexander Malcolm Nicholson: Mr. Chairman, I think you should comment on the point of order raised by the hon. member. When you rose to give your ruling I think it was improper for you to be waved down to your seat by the member who was speaking and for the chairman of this committee immediately to take his seat. I think it is discourteous to this chamber to have this conduct.


Henri Courtemanche: I do not think it was a point of order. The hon. member was just saying that he would resume his seat presently.


Robert Carman Coates: I feel that we in the maritime provinces are entering a new era, an era which will bring us nearer to that position we held in 1867 in relation to the rest of Canada. I certainly believe it would never have resulted under any other government. The Prime Minister was to the maritimes in 1957 what Sir John A. Macdonald was to Canada in 1867. He substituted a financial transfusion for tolerance.


Jean Lesage: Is the Minister of Finance going to answer the questions I asked this morning?


Donald Methuen Fleming: Mr. Chairman, there are one or two facts which I think should be made clear in regard to the further information sought by my hon. friend.


Jean Lesage: I am sorry I did not hear exactly the words of the minister.


Donald Methuen Fleming: The present resolution and bill, Mr. Chairman, are not designed primarily to reduce the cost of Beechwood power. They will have that effect; the resolution and bill will certainly have that effect-but that is not their primary purpose.
The policy of the government respecting Atlantic power costs comes under the next item on the order paper and there will be full opportunity to deal with it there. The present resolution and bill are designed to surmount a particular problem of financing. The federal government is not proposing and is not asking the house in this resolution to
Beechwood Power Project Loan lend money or to authorize the lending of money on the security of the Beechwood project. What the house is being asked to do is to approve a loan to the government of New Brunswick the reason for which is to assist that province to finance the cost of the project already incurred amounting to approximately $30 million.


John Whitney Pickersgill: In other words, it is refunded.


Donald Methuen Fleming: No, it is not refunded; that is not the word.


John Whitney Pickersgill: Would the hon. gentleman define exactly what he means.


Donald Methuen Fleming: The fact is that the project has thus far been financed by loans from various banks to the power commission of the province. These are demand loans-the usual bank demand loans-and there is also one loan by the province to the power commission. This present resolution contemplates the introduction of a bill to enable the province to meet the need of funding that obligation of approximately $30 million. I do not think any hon. member is suggesting that it is a practical proposal that the province should be now expected to go into the money market to raise $30 million on an issue. Those are the facts which I think, if I may say so, should guide hon. members in their approach to this present resolution. The financial aspects are those which are germane to the question which now has to be decided by the committee.
The questions in regard to cost or the comparisons of the cost of generating by different forms of power, whether it be by water on the one hand or thermal on the other, relate to the next resolution rather than the present one. We are now dealing with a project which is completed or virtually so, and I would ask hon. members to defer these questions concerning the development of thermal power until the next resolution which directly raises the whole question of the development of power in that manner in the Atlantic provinces.
Reference was made to the fact that there are two units on the Beechwood project. No. 1 is now in operation on a 10 per cent load factor and is producing between 820,000 and 840,000 k.w.h. per day at the present time. All these are questions which ought to be raised on the next resolution. The house has to decide now whether, having regard to the fact that this project is virtually completed-


Mr. Cannon:: Would the hon. minister permit a question?


Donald Methuen Fleming: May I finish my sentence. While the cost has been met by the power

Beechwood Power Project Loan commission, it is simply in the form of demand loans almost entirely from the banks and the problem as to the funding of that cost has now to be met. It is not within the capacity of the province of New Brunswick to place an issue of that size on the financial market at the present time.


Charles-Arthur Dumoulin Cannon: Would not the hon. minister admit that if the second resolution were not on the order paper-and after all we are only discussing one resolution at this time-it would be in order to discuss all these matters which the minister has said we should not be discussing this afternoon. Should we not take these resolutions one by one and should we not discuss this one as if the other were not on the order paper?


Donald Methuen Fleming: I quite agree that the issue as to what is germane to the present resolution is not to be determined simply by the fact that there is another resolution on the order paper but I might point out to my hon. friends that these questions which have been raised do not relate to the present resolution. They obviously relate to the following one. Questions have been raised about alternative methods of generating power-about power generated-from thermal sources. Such questions do affect the next resolution and not this one.


Jean Lesage: Would the minister permit a question? Is he not agreed that the question I have asked about the cost of power to be produced at Beechwood from the two units is very relevant to this resolution and that it has nothing at all to do with the next one.


Donald Methuen Fleming: Mr. Chairman, with respect to that question I would not have thought that-


Jean Lesage: That was my main question.


Donald Methuen Fleming: I did not think my hon. friend would be raising that question.


Jean Lesage: I did raise it this morning.


Donald Methuen Fleming: Very well, Mr. Chairman, my hon. friend has asked that attention be drawn to the calculation that appeared in an answer given in Hansard at page 2831 which reads:
1.	Assuming a production of 300 million k.w.h. annually and the borrowing rate of 6 per cent on the $29 million, the cost of power produced by the present Beechwood plant would be of the order of 7 to 7.5 mills per k.w.h.
2.	This cost could be reduced by approximately 1.2 mills per k.w.h. by loans from the federal government at a lower interest rate.
As I took his question it was this: If you do not assume a production of 300 million k.w.h. annually-


Jean Lesage: I did not say production. I said utilization which is quite different.


Donald Methuen Fleming: It does not require very much arithmetic, I would think, to know that if you assume a 55 per cent load factor the effect that is going to accrue from the present resolution will be correspondingly larger-


Jean Lesage: Lower.


Donald Methuen Fleming: -in the form of reduced costs relatively, but the relationship of the two schemes of power development and the possibility of integrating the use of power from the Beechwood project with power developed from thermal sources is something that will arise in the next resolution.


Jean Lesage: No.


Donald Methuen Fleming: We are dealing here with this one question, I take it, as to whether it is proper for the federal government to assist the province of New Brunswick in financing this obligation which has been incurred by the province through its power commission on a project that is now completed or is virtually completed. No one will deny that if the load factor is reduced-if you are figuring, for instance, on 180 million instead of 300 million kilowatt hours-you will have corresponding increases in your mill cost.


Jean Lesage: That is clear.


Donald Methuen Fleming: No one can question that. But if the hon. gentleman wants to go into the question of a comparison of those two types of generating power and the possibility of integrating them, then I suggest the place to do that would be on the next resolution. There will be full opportunity because the next resolution obviously contemplates the integration of the two types of power. There will be very great advantages in the integration of these two types of power, and Beechwood will be of very great assistance in that respect. The hon. gentleman is aware -I do not know whether all other members are-of the fact that the costs of the two types of power are built up in two quite different ways. Obviously, in the case of thermal power-


Jean Lesage: The cost of the fuel means more than the capital cost.


Donald Methuen Fleming: While in the case of electric power once you have paid for construction it is a matter of maintenance costs and depreciation.
As to whether this project is a sound project, I had not expected the hon. member for Montmagny-L'Islet to raise this question because it has been acknowledged in this house times without number by the former government of which he was an active member that the Beechwood project was a sound project. As a matter of fact the position

area in this House of Commons. It would be rather inconsistent and ridiculous for me to approve any measure before the house calling for an expenditure of public funds for the development of electricity, if that same electricity could be provided through the use of coal, from the hardpressed collieries of Nova Scotia. That is the very point I had in mind. Tomorrow, or perhaps even today, the minister will be telling us to what extent assistance will be given to the movement of coal for the generation of electricity in thermal plants.
I want to ask him, Mr. Chairman, in giving me this information, what the mill rate would be for a thermal plant in Saint John producing electricity from coal, given the same rate of assistance that will be given under the provisions of the next resolution? When that information is given to the house I will be in a position to determine my attitude to this particular resolution.
I believe it is rather confusing to deal with two companion resolutions dealing with the same area, one calling for an expenditure for a loan for the development of hydro power and the other calling for the expenditure of funds for a development of thermal plants. I think that if we get the proper information it will be helpful in reconciling the difficulty in my own mind. In so doing, I hope I will not do anything that will interfere with the welfare of New Brunswick or anything will be inconsistent with the welfare of my own constitutents.


Alfred Johnson Brooks: You are expecting to sell coal to New Brunswick.


Allan Joseph MacEachen: Yes, that is the point.


Alfred Johnson Brooks: We also have coal in New Brunswick.


Allan Joseph MacEachen: The miners at Minto may also be interested in the point of view I am putting forward. Perhaps it would be a better Beechwood for the miners at Minto if coal were used. However, that is not the point. The point is that I am interested in the difference in cost between these two sources.


Alfred Johnson Brooks: I should like to ask the hon. member this question, if I may. Does he agree with his colleagues who have already spoken advocating the full development of the Saint John river, which would mean that there would be no coal used from either Nova Scotia or New Brunswick? This was advocated by the hon. member for Charlotte and the hon. member for Gloucester. I am sure that would not appeal to the hon. member.


Allan Joseph MacEachen: Any consideration-I will say this quite candidly-that affects harmfully the market for Nova Scotia coal will
Beechwood Power Project Loan not appeal to the member for Inverness Richmond, even though proposed by my gooc friends from New Brunswick.
I just have one more point to make in connection with this particular resolution ano that is this. How will this apply to the province of Nova Scotia? This is something that I believe the Minister of Finance will agree comes squarely within the terms of the resolution. We are told that the Beechwood project was commenced in June 1955.
1	believe that within the same period the province of Nova Scotia, through its publicly operated utility the Nova Scotia power commission, also undertook the development of power installations. I wonder-and this is a very simple question-whether similar loans or similar terms would be extended to the province of Nova Scotia for similar development if a request were made in a manner similar to that of the province of New Brunswick.


Donald Methuen Fleming: I think my hon. friend will recall that a similar question was asked of the Prime Minister on November 22, 1957, as recorded at page 1405 of Hansard. There was a series of questions on the subject. The first question was:
1.	Are loans based on the principle applied to the Beechwood project to be available only for projects in the Atlantic provinces?
The answer was no. The second question was:
2.	If not, will all provinces qualify?
The Prime Minister said:
The answer is that any province that has a project for which there is an equally good case could qualify in respect of that project.


Allan Joseph MacEachen: Would that apply retroactively?


Donald Methuen Fleming: That question was not asked.


Jean Lesage: Oh, yes.


John Whitney Pickersgill: The hon. gentleman should look at question No. 4.


Donald Methuen Fleming: I would ask my hon. friends to permit me to make my remarks.


John Whitney Pickersgill: They were my questions.


Donald Methuen Fleming: Oh, yes. The hon. member for Bonavista-Twillingate will be given full credit for asking his four questions. But if he does not mind I should like to be allowed to continue; I have read questions No. 1 and
2	and have quoted the answer by the Prime Minister to them. The hon. member for Inverness-Richmond has asked, "Does that apply retroactively?" The questions that I have now read and the answers given do not raise the question of retroactivity. Question No. 3 simply asked whether the terms were

Beechwood Power Project Loan available to private companies and the answer was no. Question No. 4 was as follows:
4. Are such loans available only for new or uncompleted projects or will they be available for refunding obligations of established power projects in the Atlantic provinces?
The Prime Minister's answer was that they would not be available for refunding obligations.


Allan Joseph MacEachen: The operative word seems to be "refunding". The Minister of Finance attached to the term "refunding" this morning a particular meaning which did not seem to apply to the type of activity that was undertaken by the government of New Brunswick in repaying its bank loans. Suppose the power commission of the province of Nova Scotia had financed its development in precisely the same way as has the government of New Brunswick. Would terms similar to those provided in this resolution be available to the province of Nova Scotia?


Donald Methuen Fleming: My hon. friend would not expect me to deal with a situation until it arises. He has had the general statement of the Prime Minister in reply to the four questions put by the hon. member for Bonavista-Twillingate.


Allan Joseph MacEachen: I just want to conclude
my remarks by saying that I would have expected that there would be a particular policy the minister could outline and that these projets would not be treated on an ad hoc basis. I certainly think we should know, as members from Nova Scotia in this parliament, whether the development in that province is to be given the same treatment as the development in New Brunswick. That is the only point I am making.


Robert Carman Coates: Mr. Chairman, representing the only Nova Scotia constituency which borders on the province of New Brunswick, having attended a university in that province for three years, and having as my better half what I consider their finest export, it is with deep sincerity that I rise in support of this resolution. My wife's home is situated very near this great project, a mere sixteen miles west, in the centre of that province's great potato industry. On many occasions I have driven past this great project and never ceased to marvel at its size and what it means to that province. This was a project which the government of the day could very easily have turned its back on, through lack of support, by the then federal government, but it did not do so; it took the bull by the horns and started out on its own. Of the fact that its problems were many, there is no doubt; but the initiative and determination were there, and the job was done.

To many in Canada, viewing a project of this type would not occasion a second look. But we in the east are not accustomed to seeing projects of this scale attempted; at least, shall I say, we were not until we decided on parties that believed we had the goods and could do the job. The fact that this is only the first link in the complete hydro development of New Brunswick makes this all the more significant.
New Brunswick is indeed fortunate that they have the potential hydro development available. We in Nova Scotia have depleted a large part of our hydro resources and those remaining are receiving active consideration at the present time. We have in Nova Scotia, however, millions of tons of coal which will in the near future, and under a resolution to be introduced here in parliament later today, supply our province with thermal power, our mines with markets, and our people with an ambition that has lain dormant for a great many years.
While speaking on the matter of coal, might I bring to the attention of this house a discrepancy in the Montreal engineering report which to any person in my constituency is indeed grave. I refer to its statement of the coal reserves in the Springhill area. Might I bring to the attention of this house those figures and the figures of an earlier report on these reserves, so that you may better understand the confusion of my constituents.
The Montreal engineering report stated that there were between 6 million and 13J million tons of coal in the Springhill area and a further 1J million tons in the Joggins and River Hebert area.


Henri Courtemanche: Order. I would ask the hon. member to confine his remarks to the resolution before the committee. We are not discussing coal. We are just discussing the Beechwood project.


Robert Carman Coates: There is just one more sentence. May I just finish?


Alexander Malcolm Nicholson: I rise on a point of order, Mr. Chairman. I think you cannot raise a point of order and have your ruling ignored in this way.


An hon. Member:: Go ahead.


Robert Carman Coates: While the Carroll commission gave figures of 34,384,000 tons minable plus 89,040,000 tons recoverable in the same area. I feel-


Henri Courtemanche: Order.


Robert Carman Coates: I am almost through. I feel that we in the maritime provinces-


Charles-Arthur Dumoulin Cannon: I rise on a point of order. I have been in this house for quite a while.

taken by the former prime minister was that it was sound and that the government of New Brunswick could finance it. The soundness of the project as a scheme for the development of hydro electric power on the Saint John river was never questioned by the former government, as the record shows, on not a few occasions. May I remind the hon. gentleman that the man who turned the sod on this project was the Right Hon. C. D. Howe, and that in the course of his remarks on that occasion he praised the project. There was no suggestion at that time that there was anything unsound about it, or that the federal government of that day was telling the province of New Brunswick that it should be turning to the development of thermal power and abandoning the idea of developing hydro power on the Saint John river at Beechwood. Mr. Howe in his speech on that occasion on June 11, 1955, congratulated the premier of New Brunswick on pressing on with the project at Beech-wood.
Of course, this is a free country and a free chamber, and the hon. gentleman is entitled to change his mind on this matter if he wishes, but I should think that in the light of the many statements and acknowledgments on the part of the former government that this Beechwood project is a sound project he would not now reverse his opinion and question the proposition; and I venture to remind the hon. member for Invemess-Richmond in reply to his observations this afternoon that this was the position of the former government, which he consistently supported, toward this question.


Allan Joseph MacEachen: Would the Minister of Finance not agree that the statements made by the former minister with respect to Beechwood were always conditional upon the observation that the soundness of it should be determined by the capacity of the government of New Brunswick to finance the proposal through the banks?


Donald Methuen Fleming: No, I do not think the hon. member is right in his suggestion. That is quite a different matter. The soundness that the former government attributed to the project was as a project for the development of power on the Saint John river, that is, sound from the economic point of view, by which is obviously meant that it would in time become a project which would pay for itself. That is a different matter altogether from the question as to whether at one particular time a province with little in the way of financial resources, such as New Brunswick, should be expected without any 96698-191
Beechwood Power Project Loan assistance from the federal government to go out and face the financial market with the need for raising $30 million.
That is the situation. We think this project is of general advantage; we make no attempt to hide the fact that we said so in earlier days in this house when the question was under discussion here and also in discussions between the former federal government and the provincial government. The former federal government was asked to give such assistance, and declined to give assistance in financing the project but at no time did it question that the project was a sound economic project which justified the province of New Brunswick in proceeding with it. I would again remind hon. members that Mr. Howe undertook to congratulate the government of that province on its courage in proceeding with the scheme.
Mr. Chairman, asking the committee as I do to give its attention to the essence of the resolution and its purpose I think the committee can be satisfied now to give leave to introduce this bill, and that it can reserve questions as to the development of different forms of power in the Atlantic provinces and the integration of that type of development with the Beechwood power project until we come to consideration of the following resolution.


Allan Joseph MacEachen: Mr. Chairman, will the Minister of Finance assure me that the information I requested will be forthcoming in the discussion on the next resolution?


Donald Methuen Fleming: Will the hon. member state precisely the point he has in mind?


Allan Joseph MacEachen: The particular question is: if this particular bloc of power were developed from thermal sources-from coal -given the same type of additional sub-ventional assistance, what would be the cost as compared to the cost shown in the answer which the Minister of Northern Affairs gave to me some days ago?


Donald Methuen Fleming: I think that question is related to the next resolution.


Allan Joseph MacEachen: And it will be answered?


Donald Methuen Fleming: As far as the resources of the government can provide an answer, yes.


Jean Lesage: Mr. Chairman, the Minister of Finance has just said that the members of the previous government and I in particular had always approved the Beechwood project and considered it economically sound. He has referred especially to remarks made by Mr. Howe two years ago. I wish to remind the Minister of Finance through you, Mr. Chairman, that in all the representations
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Beechwood Power Project Loan which were made to the government of Canada in 1953 and in later years, and in all the conversations which I have had with the premier and other members of the government of New Brunswick, and in the discussions of the officials of the department while I was a member of the government, with officials in New Brunswick, on the subject of Beechwood, the project was always to have three units at Beechwood coupled with 600,000 acre feet of storage to regularize the flow of the Saint John river. It is impossible to have firm power on a run-of-the-river basis with only two units. And it is only on March 14 of this year, of 1957-


An hon. Member:: Last year.


Jean Lesage: On March 14, 1957, this spring.


An hon. Member:: That is last year.


Jean Lesage: Oh yes. Anyway, I should forget that year 1957. This is a new year. It was only on March 14, 1957, that the premier of New Brunswick advised me that it was impossible to obtain economic storage on the Tobique river. I had known for some time that efforts made by the government of New Brunswick to obtain storage in the United States in Maine and in the province of Quebec had not been successful.
The government of New Brunswick through its premier and officials represented that it was pretty well convinced that it could find the necessary storage on the Tobique river. A survey was made and I read into the record this morning a portion of the report of the chief engineer of the New Brunswick electric power commission to the chairman, Mr. Fournier, saying it was impossible to obtain storage on the Tobique. Since March a new problem has emerged with a new economic facet. It is to operate two units only until it is possible to obtain storage in the state of Maine or the province of Quebec and heaven knows when that might be. We have only two units at Beechwood with a maximum capacity of 355 million kilowatt hours operating on a 50 per cent load factor according to the report of Montreal Engineering.
I would like to know, and it seems to me it is an important consideration in reaching a decision as to how to vote on this resolution and the bill to follow it, what will be the cost of power coming from Beechwood? Would it have been more profitable to instal thermal plants to generate the amount of kilowatt hours that will be obtained from the two units at Beechwood on a run-of-the-river basis? This is essential. The Prime Minister said, as recorded at page 1405 of Hansard, that New Brunswick "had made a good case".


It is quite all right to say that and I certainly hope that New Brunswick has made a good case but one of the first considerations in judging for ourselves whether or not it has made a good case is to know if the cost of power is going to be less from Beechwood than from thermal plants; otherwise the government would be asking us to vote for the financing of a project which might be uneconomic. It seems to me it is elementary that the government should prove to us that this project, even with only two units on a run-of-the-river basis, is economically advantageous.


Donald Methuen Fleming: Is my hon. friend not aware of the opinion of General McNaughton to that effect?


Jean Lesage: The opinion of General
McNaughton, if I remember correctly, was that the two units would be first installed while the storage facilities were being developed. That is quite different. If it is a matter of only one, two or three years; that is completely different.


Alfred Johnson Brooks: Might I ask the hon. gentleman a question. Did not General McNaughton in his report state that it was feasible and practical for New Brunswick to develop Beechwood with its own storage and that it was not necessary for Beechwood to get any storage either from the state of Maine or the province of Quebec, that it was a practical proposition?


Jean Lesage: I am sorry, I do not recall that. In what year was that, 1951 or 1952?


Alfred Johnson Brooks: It was when the international waterways commission made its report, I think about 1953 or 1954.


Jean Lesage: No, it was before that I believe.


Alfred Johnson Brooks: Whenever it was made; it was made some time ago.


Jean Lesage: As the Minister of Finance has said, the most important consideration when you deal with the cost of power in a hydro power installation is the amount of the capital outlay. The Minister of Veterans Affairs knows that the cost of completing Beechwood is going to be not far from double what was expected at the time of General McNaughton's report.


Donald Methuen Fleming: Mr. Chairman, I do not think my hon. friend is right in saying that.


Jean Lesage: It might be 60 per cent.


Donald Methuen Fleming: I think my hon. friend had better qualify his statement some more.


Jean Lesage: I said "approximately".


Donald Methuen Fleming: Mr. Chairman, the situation is simply this. We are not sitting here as the government of New Brunswick deciding whether we should go ahead and carry out the Beechwood project development. We are sitting here as the parliament of Canada, acquainted with the fact that this project has been constructed, is virtually complete and that now the problem of financing arises. All that we are being asked to do is to provide financing for the province of New Brunswick to be repaid in eight annual instalments over the next eight years. I think hon. members are quite persuaded that the dominion government is going to be paid back this money, that there is no doubt from the federal point of view that this loan can be justified on its merits and that by lending this money to this province we are assisting the province in financing a very important project that is going to contribute substantially to development in that province. It is the policy of the government, and I hope it is the policy of the house, to assist in measures of this kind where the benefits are going to be widespread. It surely cannot be denied that the development of power in the province of New Brunswick is going to bring widespread benefits.	.


Jean Lesage: What are the widespread benefits? That is the point.


Donald Methuen Fleming: What are the widespread benefits? My hon. friend really surprises me in asking that question.


Jean Lesage: That is the point.


Donald Methuen Fleming: The facts are simply these, that New Brunswick does need power and here is a source of power.


Jean Lesage: It needs cheap power.


Donald Methuen Fleming: Yes, this is a source of cheap power and it is being generated by a scheme that has been regarded by the government of which he was a member and also by the experts as one that is economically sound.


Andrew Wesley Stuart: Mr. Chairman, I agree with the Minister of Finance when he says that this will be helpful to the province of New Brunswick. No one questions that it will be helpful, at least to the taxpayers, but in order to clear up the situation in so far as the stability or dependability of the source of power at Beechwood is concerned I would like to put on the record a comment made in the provincial legislature by the Hon. A. C. Taylor which is drawn from an authentic record. Mr. Taylor said:
The flow records at Pokick, below Beechwood, show that from 1st July to 31st December 1955 (a six month period) there wasn't one day with a
96698-191J
Beechwood Power Project Loan sufficient flow of water to run the two proposed 45,000 horsepower turbines at Beechwood at capacity. Not one day.
During the same period of 184 days, there were 119 days when the volume of water was not sufficient to operate even one unit at capacity.
Now I appreciate that last year was extremely dry. But who can foresee how often we may have dry years in the future? For the year of record ending on 30th September 1954 there were four months when the average monthly flow was below that required to operate two units at capacity. And that was a year of exceptionally heavy rainfall.
For the year of record ending on 30th September 1953, there were nine months during which the average monthly flow of water was insufficient for capacity production of two units.
No one who lives in the province of New Brunswick would fail to agree with me when I say that last year we had several months when it would have been impossible for one unit to operate at capacity production. I agree that it was an exceptionally dry year but there were times last fall when you could walk across above the Beechwood project. The matters that have been brought to the attention of the minister are extremely reasonable in my opinion and the questions asked by my colleague to the right deserve to be answered.
I want to say one other thing and then resume my seat. There is one member of the cabinet of the former government with whom I discussed this question on many occasions. He made this statement publicly or I would not be referring to it here at this time. The Hon. Robert Winters informed me and said in the press that in his opinion Beechwood without storage rights was not economically sound. I have a copy of that statement in my office which I can provide to the minister if he would like to see it. That comment was made by Mr. Winters who in my opinion was an outstanding engineer so I know that at least one member of the former government held that opinion.


Alfred Johnson Brooks: May I ask a question. Mr. Taylor of course is not an electrical engineer in any sense of the word. Would the hon. member for Charlotte not agree that Mr. Taylor and his party in New Brunswick voted unanimously with the government of the Hon. Mr. Flemming for the development of the Beechwood project?


Andrew Wesley Stuart: I believe he moved an amendment at the time this matter was raised.


Alfred Johnson Brooks: Not the first time, but the second time.


Thomas Miller Bell: We all have second guesses.


Andrew Wesley Stuart: I am quite sure you will find that the Hon. A. C. Taylor moved an amendment that was voted down

Beechwood Power Project Loan by the majority in the legislature of the province of New Brunswick. I know Hon. A. C. Taylor's views in this regard and I know he has not spoken from a political standpoint because I have discussed the matter with him on many occasions. I also know the views of our old friend, Gaspard Boucher, who in my opinion had as much knowledge about the power potential in the province of New Brunswick as anybody I have ever known. He had made a complete study of the situation. Before he passed away I discussed the matter with him when he was a member of the House of Commons. He had a great deal of literature that he lent me at that time. He had exactly the same opinion. The opinions I have expressed here are based on the information I have obtained from those I believe to have great knowledge of the Beechwood project.


John Whitney Pickersgill: Mr. Chairman, earlier today the Minister of Finance undertook that when he answered he would give me a definition of the word "refunding" as it is used in the Prime Minister's answer, and I have some observations I want to make based upon his definition.


Donald Methuen Fleming: Mr. Chairman, I must begin by correcting the hon. member. I did not say I would give a definition. I said I would deal with these questions-


John Whitney Pickersgill: Would the hon. gentleman do me the courtesy of giving me a definition?


Donald Methuen Fleming: -in reply in relation to that and other matters he and other members were raising at the time. The hon. member is referring to the Prime Minister's answer to the fourth question asked. I would not say for one minute that the obligations incurred thus far in connection with the construction of this project have been funded. This is not in that sense a refunding operation. This is the first time there has been a funding in the sense of the word that I think is proper. The obligations that have been incurred have been by way of bank demand loans to the power commission, with the exception of one loan made by the government of the province to the commission. This is the first time that the obligations, aggregating with additional expenditures close to $30 million, will have been funded.
What the Prime Minister was dealing with in his reply to the fourth question was the possibility of someone coming along now and raising the matter of retroactive effect which was brought up by the hon. member for Inverness-Bichmond. It is not intended that some authority which constructed a project a long time ago and would like to have some assistance now in carrying the

financial burdens should come along now and say, "Well, this may be old but we would like to come in now and receive federal assistance in refunding so that we may change the basis; we have some market obligations now, bonds are due, and we want federal assistance in meeting those obligations." That is not the situation we are dealing with here. The situation we are dealing with here is an expression-


John Whitney Pickersgill: I am not asking the hon. gentleman what the situation is.


Donald Methuen Fleming: -of the policy of the government in the development of natural resources, and where we can in ways like this assist the provinces in the development of resources it is in accordance with the policy of the government to do so. Let me say that a full understanding of the policy of the government in the development of resources in this area will become clearer, I think, when the house has heard the discussion of the next resolution. It will see there how power development projects are to be integrated in the Atlantic area and how Beechwood fits in with that type of development.
But here we are dealing with a situation which is not the mere retroactive assumption of a burden by the federal government, as the hon. member for Inverness-Richmond suggested. From the time construction of the project was undertaken, indeed before it was ever started, it was the policy of the party that is now represented to the right of the chair in this house to assist the province in the financing of this particular project. This is not a case of taking up some project that was completed and is old and proposing some refunding of its cost. This is a fulfilment of undertakings given. This is a keeping of faith with the people of Canada and the province of New Brunswick as to the declarations we made and have made throughout the period that the project was under construction, yes and long before it.


John Whitney Pickersgill: I should like to ask the minister another question. I am putting it in this form because I really do not want to waste the time of the committee by talking about something that is different from what the government understands it to be. I am trying to find out what the government really means. Am I to understand that if a project is started but is financed by bank loans or by loans from a provincial treasury it would fall within the ambit of this policy but that if it has already been financed by a bond issue then that is what the government

means by refunding? The dictionary definition of "refunding", which the hon. member for Montmagny-L'Islet was good enough to look up for me, accords exactly with my own view of what refunding means. It means that you will pay back any kind of loan. That is all there is in the dictionary. If the Minister of Finance or the Prime Minister have some special definition in mind I think the rest of us are entitled to have that definition so we will know what we are talking about. What I am anxious to find out, and I want to try to make it as clear as possible to the minister, is just what is included within the ambit of the answer to question No. 4 and what is not.


Donald Methuen Fleming: I think I made it quite clear in my previous statement-


John Whitney Pickersgill: It is not clear to me.


Donald Methuen Fleming: -that here there is no ex post facto approval by the present government of this project. We were favourable to the policy that we are now expressing before the project was undertaken, and if the hon. member can duplicate the same circumstances with regard to any other project, then in the light of the first answer given by the Prime Minister, as found at page 1405 of Hansard, it will have similar treatment.


John Whitney Pickersgill: Surely, Mr. Chairman, this is the most remarkable statement we have yet heard from a very remarkable government. The Prime Minister told us that loans based on the principle applied in the Beech-wood project were to be available to all provinces. I presume the Prime Minister was not trying to mislead the house. I presume the Prime Minister was trying to give a straightforward, truthful answer that all of us could understand. He said that loans based on this principle were available to all provinces and that the provinces would have to meet certain conditions that were met by the Beechwood project.
When I try to find out what those conditions are the minister says there is no other project anywhere in Canada that can possibly be comparable-


Donald Methuen Fleming: I did not say anything of the kind.


John Whitney Pickersgill: Perhaps the minister would let me finish my sentence.


Donald Methuen Fleming: Please keep to the truth.


John Whitney Pickersgill: The minister implied, if I understood his words, that any project that had been fully financed could not qualify and obviously any project that has not been started cannot qualify because the minister said it had to be some project that his party
Beechwood Power Project Loan had approved in the past. Therefore, this case is unique. There will never be anything like it. Is that a correct interpretation of the government's position?


Donald Methuen Fleming: I cannot find anything correct in the statement the hon. member has made. It is a demonstration of pretty wild reasoning, the way he is jumping around-


John Whitney Pickersgill: Would the hon. gentleman-


Donald Methuen Fleming: -distorting statements I have made and then drawing the most fantastic conclusions from my alleged statements. I think he had better content himself with the statements I have made and ponder on them rather than misinterpret them the way he is doing now.


John Whitney Pickersgill: I am very far from being finished, I am only just beginning to talk about this project in this free parliament where the minister was good enough to say we still are allowed to speak, so long as we confine our remarks within the very narrow limits defined by the Minister of Finance.


Thomas Miller Bell: May 1 ask
the hon. member a question?


John Whitney Pickersgill: Most certainly.


Thomas Miller Bell: How does the hon. member for Bonavista-Twillingate justify his position as Liberal whip for the Atlantic provinces and therefore speaking for all the Atlantic provinces, and his position of being against something that is for one of the Atlantic provinces? Secondly, how does he justify the statements of some of the Liberal members that this is nothing; it is a mere bagatelle and the Liberals would have done this and that and would have gone much further, and yet he is worrying about the fact that these other provinces might not be getting anything?


John Whitney Pickersgill: Mr. Chairman, the hon. member for Bonavista-Twillingate is not the Liberal whip for the Atlantic provinces. He is the member for Bonavista-Twillingate and is speaking for his constituents just as the hon. member for Saint John-Albert is speaking for his. That is his first duty in this house. In the second place, I do not have to justify what any other hon. member says. He can justify what he says. In the third place, I have said not one single word to indicate whether I was voting for or against this resolution.


Some hon. Members:: Hpar, hear.


John Whitney Pickersgill: I have merely asked questions. Like the hon. member for Inverness-Richmond, I want to know what we are

BeechwoocL Power Project Loan really being asked to agree to, and the government will not tell us.


Donald Methuen Fleming: Nonsense.


John Whitney Pickersgill: All we have been able to gather so far from the Minister of Finance, and I shall recapitulate what the minister said to the hon. member for Montmagny-L'lslet as faithfully as I can, is that the province of New Brunswick built this thing; you are not entitled to know whether it is efficient or inefficient; that is an unfair question. You are not entitled to know whether this power could be produced more cheaply as thermal power; that is no business of the House of Commons. You are to vote this money blindly. Why are we to do that? We are to vote this money blindly because New Brunswick went ahead and built this thing without financing it; now, they cannot finance it and we have to bail them out. Up to now that is all the Minister of Finance has asked us to do. I do not think it is good enough. I am just as anxious to do something for New Brunswick as any other member who does not represent that province.


Thomas Miller Bell: You better not come around at election time in New Brunswick.


John Whitney Pickersgill: I might remind you, Mr. Chairman, that there are 255 members in this house who do not represent New Brunswick. Those 255 members not only are entitled, but if they are doing their duty conscientiously in voting public money they have an obligation to know whether or not that money is being used wisely and properly. They have an obligation also to know whether or not the same policy would apply in other similar situations, and what the government considers other similar situations are. That is precisely what I am trying to find out.


Alfred Johnson Brooks: You were not so fastidious when you were voting money for the pipe line in the west.


John Whitney Pickersgill: I might say, Mr. Chairman, that most hon. members on this side of the house have no apologies to make for voting money for that great capital project which is one of the few things that is maintaining employment in this country at this time. Incidentally-


Henri Courtemanche: Order.


John Whitney Pickersgill: Incidentally, it is certainly-
Mr. Pallet!: It has not got as much gas in it as you have.


John Whitney Pickersgill: Incidentally, it is a great national scheme and very different from anything we have been offered by this government. I think perhaps hon. members on the treasury benches particularly should be reminded, as I believe they were earlier in the day when I, unfortunately, was not in the house, by the hon. member for Gloucester, of the words in the speech from the throne. I read from page 6 of Hansard of October 14, 1957:
My ministers believe that a national development policy carried out in co-operation with the provinces, and in the territories, is needed to enable all regions of Canada to share in the benefits to be realized in developing the resources of this great nation.
Then it goes on to include amongst those projects this Beechwood project. I should like to ask the Minister of Finance one very simple question, to which an answer of yes or no could easily be given, even by the verbose Minister of Finance.


Donald Methuen Fleming: What about the verbose member for Bonavista-Twillingate who is asking the question?


John Whitney Pickersgill: Is this Beechwood project part of this national development program?


Donald Methuen Fleming: Yes.


John Whitney Pickersgill: The answer is yes.


Thomas Miller Bell: Are you going to vote for it or against it?


John Whitney Pickersgill: The hon. gentleman's curiosity will no doubt be satisfied at the appropriate time. Perhaps with that enthusiasm for human rights, which his party showed yesterday, he may allow me to exercise my rights as a member of parliament without his repeated interruptions.


Thomas Miller Bell: You mean we will know when your verbosity has run out.


John Whitney Pickersgill: The Minister of Finance says that this Beechwood project is a part of the national policy. It does seem to me, sir, that if it is we are entitled to know, before we are asked even to make up our minds how we should vote on this resolution, what the rest of that national policy is. We are entitled to know how this is going to apply elsewhere. I tried to find out something about that by putting some questions on the order paper. They were not intended to be frivolous and I did not waste the time of the house by asking them on orders of the day. I gave the government plenty of time to prepare the answers. Those answers have been referred to several times, and they are going to be referred to by me several
302S

times more. One question was, as reported on page 1405 of Hansard for November 22, 1957:
Are loans based on the principle applied to the Beechwood project to be available only for projects in the Atlantic provinces?
The Prime Minister said that the answer was no. I believe that the minister should tell us, before we are asked to vote, what other projects there are to which this principle is going to be applied by the present government. I grant that they cannot foresee everything in the future, but surely they would not have put those words in Her Majesty's mouth if they had not had some meaning, some content. The only specific references that one can find in the speech from the throne are four. The references are to the South Saskatchewan, the Columbia, Beechwood and these thermal plants, not one of which is original at all. Every one of these suggestions was under consideration before the present government came into office. Furthermore, sir, they do not accord in any way with what the Prime Minister indicated before his election when opening the campaign at Massey Hall on April 25, 1957.


An hon. Member:: Where is the red book?


John Whitney Pickersgill: The red book is here, but I have lots more where this came from. He said:
We Intend to launch, in order to assure the economic development of this country, a national policy of development; in the northern areas it may be called "The New Frontier Policy" . . .
We believe in a positive national policy of development in contrast with the negative, haphazard one of today.
Presumably this referred to the government that was then in office.
We believe that the welfare of Canada demands the adoption of such a policy which will develop our natural resources for the maximum benefit of all parts of Canada;-
Now nearly seven months later the government finally gets around to bringing forward the first part of this national development program.


Gordon Knapman Fraser: It took the Liberals 22 years.


John Whitney Pickersgill: What did we do in 22 years?


Gordon Knapman Fraser: Nothing.


John Whitney Pickersgill: I will tell the hon. gentleman on another occasion about a few other things besides the St. Lawrence seaway which is bigger than all the things they have suggested or all the things they have even been able to make any suggestion about.


An hon. Member:: What has that to do with Bonavista-Twillingate?
Beechwood Power Project Loan


Mr. McDonald (Hamilton South):: Did not
the Conservative government in Ontario prod the Liberal government to go ahead with the St. Lawrence seaway?


John Whitney Pickersgill: Perhaps the hon. gentleman who is a new member does not realize that on February 7, 1949 my right hon. friend, the hon. member for Quebec East, who was then prime minister of this country and who had only been prime minister for something under three months, went to Washington to confer with President Truman at the instance of no one but himself and I went with him. It was the right hon. gentleman who initiated the discussions with President Truman which broke the log jam over the St. Lawrence seaway.


Some hon. Members:: Oh, oh.


Robert Matthew Turnbull McDonald: Would the hon. member agree that the New York state power commission and the Ontario Conservative government helped just a little bit in prodding you, just a wee bit?


John Whitney Pickersgill: We never pretended there was not co-operation. There was, I may say, most excellent co-operation over all that period between the federal government and the government of Ontario and indeed with the government of every other province. There was no attempt on our part to select provinces according to the political complexions of their governments.


Alfred Johnson Brooks: Might I just point something out to the hon. member?


John Whitney Pickersgill: I do not mind a question by the hon. gentleman but I do not like his pointings out.


Alfred Johnson Brooks: May I ask the hon. gentleman a question?


Arza Clair Casselman: Order. I think this debate has gotten pretty much out of hand.


Stanley Howard Knowles: It is
degenerating- into a debate.


Arza Clair Casselman: Standing order 59, paragraph (2) reads as follows:
(2) Speeches in committee of the whole house must be strictly relevant to the item or clause under consideration.
All I would do would be to ask hon. members to bear that standing order in mind in the next few minutes. I think that after the next few minutes have passed and after hon. members have settled down we will have less trouble.


Alfred Johnson Brooks: I wanted to ask the hon.
gentleman a question if he will permit me to do so.

Beechwood Power Project Loan


John Whitney Pickersgill: If it is a question, all right.


Alfred Johnson Brooks: My question is this. Is he not aware that the province of New Brunswick supported fully the St. Lawrence seaway although they do not expect to get any benefit at all from it?


John Whitney Pickersgill: As a matter of fact, I think the members elected from the province of New Brunswick over the years as I have observed them in parliament-and I think most of them have been Liberals-have taken a national attitude and have supported everything that was good for the country.


Alfred Johnson Brooks: I am not a Liberal-


Arza Clair Casselman: May I intervene for a moment. If anyone is desirous of asking a question of the hon. member who is speaking I wish that he would make his question strictly relevant to the subject under discussion.


John Whitney Pickersgill: I appreciate very much your intervention on my behalf, Mr. Chairman, because I am trying very hard to be strictly and completely relevant to the resolution before the house.


Mr. Rowe:: You have not succeeded very well in the last few minutes.


John Whitney Pickersgill: I should like to take a moment to define again, if I may, what I consider is really relevant. We are being asked, as the Minister of Finance has admitted, to approve a bill to carry out stage 1 of the national development policy initiated in the speech from the throne. This stage 1 is entirely within the confines of one of the ten provinces. Two hundred and fifty-five of the members of this house represent the other nine provinces. We are being asked -and I take no exception to this-to vote a considerable sum of money,-by way of loan, it is true,-for this project. It seems to me that we are entitled to be told what up to now is the whole policy of the government which is to take the place of what the Prime Minister, before he was Prime Minister, referred to as the negative, haphazard one of the previous administration.
Nothing in the speech from the throne, or nothing that we have been told in the seven months in which this government has been in office, has disclosed any project whatever that was new or any suggestion of any project that was new. We have this Beechwood project which has been discussed for the last seven or eight years and which, as the Prime Minister said when he congratulated the premier of New Brunswick, had been completed some time ago. We are being asked


to do what I would call refunding of the money spent on this project. The Minister of Finance quarrels with my language. He does so, I presume, because he does not want to admit that it is just as reasonable for the government of Nova Scotia to ask for the refunding of the loan for something they did a year or two ago as it is to ask for the immediate refunding of this one.
The effect of this loan will be to reduce the cost of power in New Brunswick to some degree. The minister himself admitted that. Why should we be asked to do that in New Brunswick and why should it be refused in Nova Scotia merely because the government of Nova Scotia more prudently arranged for a bond issue? Surely what the Minister of Finance has enunciated, if I understood him correctly, is that if a province goes ahead and does something imprudently and then finds it cannot float a bond issue itself, it is then our duty to do it for them; but if they are prudent and careful, as Nova Scotia was, and do it themselves, then they are not entitled to as favourable treatment. Is that the policy? It seems to me that what we have had so far are a few bits and pieces left over from before June 10 and that we should not be asked on this basis to approve this resolution without being told what else the government is going to do in this field.
I am particularly interested, of course, in knowing what the government intends to do about the province of Newfoundland. We are undoubtedly in more need of electrical development there than is any other part of Canada. There is no other province where there are more homes, in proportion to the total, without electricity. I do not think even the Minister of Finance would contend that the province of Newfoundland is in a better financial position to float a loan to develop electricity or indeed to reduce the cost of electricity that is already developed, because that is all we are doing here. We are not developing anything new; it is all completed. The Minister of Finance says it is in operation. We are simply reducing the cost of something that is already in operation. Why should not that be done in Newfoundland merely because bonds have been floated. It seems to me that is a very difficult principle to get anyone to accept. Why should it not be done in Nova Scotia? What is going to be done for Prince Edward Island? I understand that earlier today the Prime Minister told the house that he had had a telegram only yesterday from the premier of Prince Edward Island-


Arza Clair Casselman: Order. I think the hon. gentleman is far away from the subject

before the house. I would ask him to make his remarks relevant to the subject matter under discussion.


John Whitney Pickersgill: I submit, Mr. Chairman, with the greatest possible deference and respect that, the Minister of Finance having said that this proposal was part of a national policy it is surely proper for any of us to ask how the principle behind this proposal will apply in other places. If this were purely an isolated matter not connected with anything else, and if the government were just coming here and saying that the province of New Brunswick is in financial difficulties and that notwithstanding anything else in any other part of the country we should come to their aid, that would be one thing. But they are not saying that. They are saying that this is stage 1 of a national policy. We are being asked to approve stage 1 and to spend a considerable amount of money on a policy-


Arza Clair Casselman: Order. The matter before the house is as follows: House in committee of the whole on a certain proposed resolution to authorize loans to the government of New Brunswick for the development of hydroelectric power at Beechwood on the Saint John river.
That has nothing to do with anything in Prince Edward Island, Nova Scotia, Newfoundland or any other place. It is tied down strictly to the government of New Brunswick. I wish the hon. gentleman, who certainly knows the rules of the house better than most of us and far better than I do, would use his own good judgment and stay within the rules.


John Whitney Pickersgill: I will endeavour to do my best, Mr. Chairman, to stay within the rules and I of course would not for one moment, as a member of the house of only four years standing, put my judgment about the rules or about any other matter against the judgment of Your Honour. However, the resolution does say that it is expedient to do this and it seems to me that determination of that expediency depends upon the reasons for which we are taking this action. Surely that is the essential point, the fundamental point? Are we being asked to do this as a rescue operation because the government of New Brunswick is broke. Is that the reason, or are we being asked to do it as part of a national policy.
The Minister of Finance said when I asked him a question and when, for the first time to my recollection he gave a simple and straightforward answer for which I was grateful, that this was part of a national policy. Surely before we are asked to discharge this most fundamental of the obligations of the House of Commons-to vote the taxpayers' money- 96698-192
Beechwood Power Project Loan we are entitled to make the fullest and most searching inquiry into the reasons for which we are being asked to spend that money. We are also entitled to ask what it is eventually going to involve, not just what it is going to involve in approving this policy. If I might venture an analogy, the Minister of National Defence on many occasions has asked the house to approve the prototype of aeroplanes-[DOT]


William Earl Rowe: On a point of order, Mr. Chairman. Surely the hon. member is not suggesting that we should waste the time of the house while he tries to convince the house that it is relevant for him to be saying, first, that it is part of the national policy only that we are discussing and then that it is relevant to demand that we should discuss all parts of the national policy. We are now getting into defence and I submit that it is so irrelevant that it might almost make us forget that the hon. member tries to be relevant.


Jean Lesage: The chairman will be in a very embarrassing position.


John Whitney Pickersgill: It is, I am afraid, becoming clearer and clearer why the Prime Minister is willing to move for the abolition of closure in this house. We do not have to have formal closure because we have closure from the government benches. I have been attempting to discuss this matter which is a matter in which I am being asked to vote money collected from my constituents and from the constituents in the other parts of Canada to do a particular job in a particular place, and which is supposed to be part of a policy about which we are told nothing. Furthermore, we are told that we are not entitled to inquire even as to the cost of the power produced; that it is irrelevant to this discussion. We are told we are not entitled to find out whether this plant is efficient or inefficient; it does not matter, we have to pay for it anyway. We have to pay out this money blind and now we are told that although the Prime Minister has said-and it is here in answer to a question-that this is part of a policy that applies to all the provinces, we are not entitled to inquire how it would apply, where it would apply or under what circumstances it would apply.
If we are going to have all these restrictions placed upon us I do not know what point there is in having these discussions at all, but I am going to endeavour to keep within the rules, to continue my inquiries and to hope that one of the members on the treasury bench, who were not so slow about making inquiries themselves when they sat over here, will make some effort to answer some of these questions after they have been put.

Beechwood Power Project Loan
I would like to know, firstly, whether the government has in mind at the present time any projects whatever in the province of Newfoundland? Whether any attempt has been made to expand this national policy to the province of Newfoundland; that is to say the national policy embodied in Beechwood?
The Prime Minister said it would be extended to all the provinces; he said it was not going to be haphazard but that it was going to be planned and organized. That is what he said before the election. I would like to know what is going to be done in Newfoundland, what is going to be done in Prince Edward Island and what is going to be done in response to requests made at the federal-provincial conference?


Donald Methuen Fleming: Mr. Chairman, on a point of order, surely this irrelevancy has gone far enough. My hon. friend is going to discuss every project right across Canada if this goes on. Surely there must be an end to this obstructive breach of the rules of the house.


Arza Clair Casselman: I should like to remind the hon. member that his time has expired in any event.


Mr. Hansell:: I am not going to make any extended speech because I had one jotted down here in which I was going to talk on the thermal energy power plants and, just as I was going to speak I discovered the minister was objecting to the bringing of this particular type of power into this debate by reason of the fact that the next order of business is to be a resolution dealing with thermal power.
I would, however, like to receive the assurance of the Minister of Finance and the Minister of Northern Affairs and National Resources, who is the sponsor of the further resolution, that we will be able to discuss in the fullest and the freest possible way the subject matter of thermal electric power projects. I would like to have this promise. Otherwise I will try to give my speech on this particular resolution.
I appreciate what the minister has said to the effect that he and the government are interested in assisting in projects which would bring widespread benefit to the people. That is what he said. I think perhaps when he said it he must surely have had his tongue in his cheek because some of us remember not so many months ago when a matter was before us to provide for loans to another great project in Canada which would benefit a terrific number of people, the hon. minister and his party at that time were so vociferous in their attacks on the proposal, and he himself was such a bad boy at the time, that


we read him out of the house-yes, and he draped his desk with the flag. That is how interested he was in assisting a project which would bring widespread benefits to the people.


Stanley Howard Knowles: Would the hon. member permit a question? Is there no difference between making a loan to a private corporation and a loan to a provincial government?


Ernest George Hansell: There certainly is a difference, but in principle the difference is that you are either doing it to a provincial government or you are doing it to a private corporation. But the principle of the loan is the same.


Arza Clair Casselman: Order.


Ernest George Hansell: I am only answering the hon. member's question.


Arza Clair Casselman: The hon. gentleman is answering a lot of questions all of which are out of order.


Ernest George Hansell: Well, the question itself should not have been admitted.


Stanley Howard Knowles: The
hon. member should not have provoked it.


Ernest George Hansell: In that case I might say that the loan was made and repaid before maturity with interest.


Stanley Howard Knowles: And
Tanner and Coates made their millions.


Ernest George Hansell: And the treasury of this country benefitted thereby. However, I want to ask the minister now if he will give us an assurance that we will be able to discuss this matter of thermal nuclear power projects in the widest field, because this is a resolution with great possibilities and we want that assurance now.


Francis Alvin George Hamilton: To which minister are you referring?


Ernest George Hansell: Either one could give me the assurance.


Donald Methuen Fleming: The hon. member is a senior member of this house and he knows the rules of relevancy. The next resolution is one that refers specifically to thermo-electric power. It will be for the chairman of the committee to determine what discussion is relevant to that resolution; it is not for me as a minister or as a member of this committee to lay down the interpretation which shall be given. The chairman of the committee will do that. But I am pointing out that I have consistently throughout all this discussion stated that a discussion of thermo-electric power projects

is not relevant to the resolution now under consideration which is confined purely and simply to Beechwood which is not a thermal project at all.


Ernest George Hansell: When you said that you also stated that thermal power plants could reasonably be debated on the resolution which is eventually to come up in committee and I just wanted a reassurance on that point because I had my speech ready to give on this resolution.


Donald Methuen Fleming: I suggest that if the hon. member had something to say about thermal power projects in the Atlantic provinces he should make his remarks on the next resolution, because they clearly would not be relevant to this resolution.


Jean Lesage: Mr. Chairman, I want to be assured that I understood the minister well when he said we would be allowed to discuss the cost of hydro electric power produced at Beechwood under the next resolution.


Donald Methuen Fleming: I should have thought, Mr. Chairman, it is clear that I cannot interpret the next resolution. We have not even reached it yet. But the reading of the terms of that resolution makes it quite clear-


Jean Lesage: There is no mention of hydroelectric power in the next resolution. The phrase used is thermal-electric power. In the present resolution which we are studying the words are "hydroelectric power at Beechwood". My question is this: what will be the cost of the power generated at Beechwood, with only two units, on a run-of-the-river basis, taking into account all the conditions that I mentioned earlier at the substations, ready for distribution to the public?


Donald Methuen Fleming: All I can say is that my colleague, the Minister of Northern Affairs and National Resources, has indicated he will speak in the course of considering the next resolution about the integration of the Beechwood and other schemes of power development in the Atlantic provinces.


Jean Lesage: So it will be possible to discuss the cost of energy at Beechwood as part of the integrated program in New Brunswick and Nova Scotia?


Donald Methuen Fleming: So far as the chairman who may be called on to rule on the matter considers it relevant to the terms of the next resolution.


Jean Lesage: I am sure the chairman would be much enlightened if he had the benefit of the opinion of the Minister of Finance upon this question.
96698-192J
Beechwood Power Project Loan


Donald Methuen Fleming: I must decline the hon. member's invitation to be irrelevant and to break the rules of the house.


John Whitney Pickersgill: In this case however there can surely be no doubt that the cost of power at Beechwood is relevant to this resolution. Surely the Minister of Finance is not going to say, and surely you, Mr. Chairman, would not be led by the Minister of Finance into thinking, that the cost of power developed under this project is something which hon. members of this committee should not be entitled to know before they are asked to vote this money. And surely hon. members are also entitled to know how that cost compares with the cost of other power which can be supplied to developments in the same area. Since we have no assurance whatsoever that this information will be available to us while discussing a subsequent resolution, I do not think we should be asked to agree to this resolution until this absolutely relevant information is provided. For my part I am far from being satisfied about this project and I wish to pursue certain other matters. I want to go back to the question of refunding. As I understand the Minister of Finance, this project will be completely paid for before the federal government is called on to pav out any money. If I am incorrect I should appreciate being corrected now.


Donald Methuen Fleming: Well, you are incorrect.


John Whitney Pickersgill: It will not be completely paid for?


Donald Methuen Fleming: If the hon. gentleman had been in the committee today when I made various explanations he would not now need to delay the committee by rehashing what has been said and getting all mixed up the information I gave. What I said was that the cost of the project would be known when the project is completed, and it is at that point that it will be determined whether the cost amounts to $30 million or not. The fact is that the bill places a limit of $30 million on the obligation, and it is at that point that the extent of the obligation will be made known, and the loan taken down by the province.


John Whitney Pickersgill: I am only seeking clarification, quite without offence, and perhaps I can put it in another way which the Minister of Finance will admit is fair. I understand that this project is to be completed before any federal money is advanced. Is that correct?


Donald Methuen Fleming: Mr. Chairman, we are informed that the province is not intending to take down the money until April 1 in order to obtain the advantage of the lower rate we
3030	HOUSE OF
Beechwood Power Project Loan expect to have available as the federal rate to crown corporations in the six months period commencing April 1.


John Whitney Pickersgill: I think perhaps the Minister of Finance was not dissenting from my point when I said that this project would have been completed before any of this loan was made to the province of New Brunswick.


Donald Methuen Fleming: I indicated earlier, Mr. Chairman, that the No. 1 unit is now in operation on a 100 per cent load factor. I may add to that that No. 2 will be going into service for mechanical tests on January 17 according to our information.


John Whitney Pickersgill: So far as the government is informed about this project we are being asked to pay for on an interim basis it will be completed before any of the loan is taken up. Apparently the minister has not taken the trouble to inform himself very precisely about this but as far as the minister knows it will be completed.


Donald Methuen Fleming: Oh yes.


John Whitney Pickersgill: That was all I was trying to find out and if we had had the "yes" a little earlier it might have saved some time.


Donald Methuen Fleming: If you had asked the question a little more plainly earlier you would have received the answer.


John Whitney Pickersgill: I asked three times.


Donald Methuen Fleming: And I answered three times.


John Whitney Pickersgill: Then, sir, this project in the ordinary dictionary definition of the term is a refunding project, it is repaying something that has already been paid, which is the dictionary definition of "refunding". I cannot understand, and I doubt if any other fair minded member of the house can understand why, because a project has only been completed for two or three months it should be a proper thing to ask parliament to vote money to refund the cost of it and why it should not be equally proper to do so in the case of a similar project in Nova Scotia which was built a little earlier. I should like to obtain from the minister, and I am sure that in view of the Prime Minister's answers you would not consider it irrelevant, Mr. Chairman, his explanation in clear terms of the kind of project which could qualify for similar treatment. On November 22, 1957, as recorded at page 1405 of Hansard I asked the following question of the Prime Minister:
Are loans based on the principle applied to the Beechwood project to be available only for projects in the Atlantic provinces? If not, will all provinces qualify?
In answer to the second part of that question the Prime Minister clearly said that


these loans were not going to be available just for Beechwood. He used the following language:
The answer is that any province that has a project for which there is an equally good case could qualify in respect of that project.
I should like the minister to define the kind of project which would be an equally good project because this is of great interest to those of us who represent other parts of the country. We are being asked to vote for this resolution to lend this very considerable sum of money for this project and our constituents are going to want to know whether they can benefit similarly by this national policy of the government. We will have to account to them for our vote and we are surely entitled to a clear definition of what the Prime Minister meant by that answer to the second part of my question which he gave on November 22.


Donald Methuen Fleming: Mr. Chairman, the subject matter of the discussion before the committee at this time is the resolution concerning Beechwood and it is not the four famous questions asked by my hon. friend and answered by the Prime Minister in this house on November 22. We are debating the Beechwood resolution and I must decline my hon. friend's invitation to offend the rules of the house by straying into all other manner of projects scattered across Canada.


Andrew Wesley Stuart: Mr. Chairman, may I ask one question before six o'clock. The minister has said that the province of New Brunswick would not take advantage of this loan until April 1. It occurred to me that there might be a considerable difference between the interest rate the province would now be required to pay to the bank and what it would pay under this arrangement. Would it not be more beneficial to the province to take advantage of this loan now than to pay the interest to the bank on this huge loan? In view of the difference in the interest rate would it not be reasonable to expect that the province would take advantage of it now?


Donald Methuen Fleming: That, Mr. Chairman, will be a matter for decision by the government of the province of New Brunswick. Once the bill which we hope to introduce after this resolution is passed the power will be given to make the loan to the province when the province chooses to take it. In deciding not to take it before April 1 or after that date I presume the province will consider where its advantage lies having regard also to the fact that the obligation it will be incurring under this loan will be for an eight-year period.


Andrew Wesley Stuart: What I mean is that from the standpoint of the interest rate it would appear to be to the benefit of the taxpayers of the province to take advantage of

this loan now with a lower interest rate than to continue paying the rate of interest that would be necessary to pay to the bank at this time.


John Whitney Pickersgill: Mr. Chairman, perhaps I could pursue my point. Since the minister is not willing to answer my question which it does seem to me is completely relevant he places me and I think he places hon. members from practically every province except New Brunswick in a position of great embarrassment. We are being asked by this resolution to approve the beginning of something the extent of which we are not even to be allowed to see. We are being asked to do something in the province of New Brunswick and the minister resolutely refuses to tell us how it could be done in any other province despite the fact that the Prime Minister said this could be done.
As I have some rather extended observations to make on this question, Mr. Chairman, perhaps I might call it six o'clock.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at eight o'clock.
John Whitney Pickersgill: Mr. Chairman, when we rose for the dinner recess I was just pointing out to the committee that the minister had made it clear that the purpose of the bill to be founded on the resolution was to refund the moneys expended by the government of New Brunswick on the Beechwood project. I know that the minister does not agree with the definition of the word "refund" that is found in all standard dictionaries and that I am using here, but the minister has indicated that this project by that time will have been completed, that there will be no new work, that there will be no further employment in building the project.
In other words, it is not something new that is being done. It is a project on which the work is entirely completed, a project that is in operation and on which there is a debt which the federal government intends to assume, if the bill is passed, up to $30 million. That is what this proposition is. We are being asked to agree with the government that it is expedient to lend the government of New Brunswick up to $30 million to refund these obligations of the government of New Brunswick for this particular project in this particular place, a project which the minister has told us is part of the national development policy of the government.
We have the Prime Minister's answer in the house to a question I put on the order
Beechwood Power Project Loan paper which was obviously very definitely considered, that this is not an isolated matter, that it is part of a policy that is applicable in all the provinces or in any province -I want to be quite accurate-in which there are comparable conditions. It seems to me it is quite impossible for us to decide in the knowledge of all the circumstances whether it is really expedient to make this very considerable charge upon the taxpayers of Canada for a project, however meritorious it may be, and I am not discussing its merit at the moment, in one particular place in one particular province, until we know how this policy which the government has told us is a national policy applicable across Canada is to be applied in other provinces, and what in the opinion of the government would constitute the similar circumstances to which the Prime Minister referred.
It does seem to me, sir, that it is very hard for a member representing a constituency in the province of Newfoundland, where the need for the development of power is as great as it is in that province, to say that it is the right thing to do to vote public moneys for this project in another province unless we can be satisfied that Canadian citizens living in another province, a province with even less resources, will be similarly treated by the government in like circumstances. I must say, sir, that it is impossible for me to understand how the government can make any kind of valid distinction making any sense at all between lending this money to New Brunswick to pay off the Bank of Montreal, the Canadian Bank of Commerce or whatever chartered bank it may be and saying on the other hand that it would be quite improper to lend money, say, to the government of Nova Scotia to pay off a bond issue, thus reducing the cost of power to the users in Nova Scotia. It does not seem to me that we should be asked to adopt a policy of limited application to a very limited area of the country unless we know that if comparable circumstances exist it will be applied in other places as well.
I must say I was rather astonished by the answer given by the Prime Minister to the third question I put to him and which he answered on November 22. That question was:
Are such loans available only for projects owned by provincial governments or provincial crown agencies or will they be available to private power companies sponsored by a provincial government?
This is the answer given by this great Tory government, the apostles of free enterprise. It would not have surprised me in the least bit if a government headed by the hon. member for Winnipeg North Centre, or by his

Beechwood. Power Project Loan colleague, the hon. member for Rosetown-Biggar, if there ever were such a government in this country, would have given this kind of answer but it does surprise me that such an answer should be given by this Tory government that boasted during the election campaign that they were going to take government out of business, that they were going to restore free enterprise. What did they say? The answer given was no, such loans would not be available to private companies.


Stanley Howard Knowles: What would be your stand?


John Whitney Pickersgill: What would be our stand? We are trying to find out whether or not it would be a wise thing to make this money available and the government refuses to give us the information on which we can make an intelligent judgment.


Donald Methuen Fleming: Do not hold the government responsible for that.


Jean Lesage: They surely are.


John Whitney Pickersgill: The government is certainly responsible for the failure to give information, and I know of no member of the house who spoke-I will not say eloquently- more frequently, more vociferously, more

perhaps it is rude to say this-noisily-


Some hon. Members:: Oh, oh!


John Whitney Pickersgill: My colleague from Newfoundland says "more vehemently"-about the denial of information than the hon. member for Eglinton when he was on this side of the house. The hon. member for Montmagny-L'Islet and the hon. member for Inverness-Richmond tried vainly all afternoon to find out what this power is going to cost and what comparable power produced from coal would cost, but the government says that is none of the business of members of the House of Commons. We are to vote blind on this motion.
I do not think we should be asked to do this. It is true that this project is finished. It is true that it has to be paid for by somebody and it may well be, as the minister indicated, that at the present time the government of New Brunswick could not float a loan to pay for it. It may well be that it is in the national interest to take the course that the government is asking us to take. They are asking us to embark upon what they say is stage No. 1 of a vast new policy. Surely we are entitled to be told how that policy will apply right across the country. We are surely not to be asked to accept it on faith, to accept it without being told what is involved in the project itself or how other communities could

avail themselves of the same policy which the Prime Minister told us is available across the country.


Arza Clair Casselman: Order. I think the hon. member will agree with me that he is out of order. The basis upon which he is speaking now is not relevant in any way to the resolution before the house.


John Whitney Pickersgill: It would be impossible for me, with the respect that I have publicly demonstrated for the chair by putting down the motion that is on the order paper in my name-which I do not think the government will ever allow us to debate-to dissent from your judgment. I readily accept it.


Arza Clair Casselman: I am very appreciative of that. I trust that that will be the course of action the hon. member will follow from here to the end of his speech.


John Whitney Pickersgill: Certainly, Mr. Chairman, I shall endeavour to be strictly relevant. I understand, Mr. Chairman-I understand-


An hon. Member:: You said that.


John Whitney Pickersgill: 
Jean Lesage: Unemployment will be higher.


Gordon Knapman Fraser: You are getting away from the subject now.


John Whitney Pickersgill: I am talking about the interest rate on this proposed loan. If the interest rate on this proposed loan is not relevant, I should like to know what hon. gentleman opposite think is relevant to this resolution.


Hédard-J. Robichaud: They would rather have closure.


John Whitney Pickersgill: 
Arza Clair Casselman: Order, please. The hon. member knows he is out of order. He is covering the whole country.


Jean Lesage: Mr. Chairman, on the point of order, may I very respectfully submit to

you that the questions asked by the hon. member for Bonavista-Twillingate are in order. After all, here we have a resolution dealing with a specific project, it is true, at Beechwood, giving to the government of New Brunswick very special conditions for a loan, for the refunding, in this case, of a power project. Surely it is in order to inquire from the government if the same terms and conditions will be available for other projects elsewhere in Canada, or I do not know my rules any longer.


Gage Workman Montgomery: The former minister, who has just been speaking, received an answer to that in the one word "yes", this afternoon. I do not know why he wants to pursue it and pursue it.


Stanley Howard Knowles: Mr. Chairman, with respect, I should like to appeal to you to reconsider the decision you have made. Before I press the point as to the right of the hon. member for Bonavista-Twillingate to ask questions about this matter in the context in which the government has placed it, may I say that so far as we are concerned we will support this proposal. I shall come back to that later.
I should like to point out that in the speech from the throne, with which this session was opened, there were three paragraphs relating to national development. The reference to the Beechwood project is in the middle of the second paragraph. There are words in that speech from the throne about national development before the reference to Beechwood and then after the reference to Beechwood there was this statement:
My ministers will advance this national development policy further by initiating new discussions with the government of Saskatchewan-
My point, Mr. Chairman, is that it is the government itself that has presented to parliament this proposal in the context of a national development policy which calls for assistance for development in various parts of the country. It seems to me that before we are asked to declare as to the expediency of this measure we have a right to ask questions and get answers as to the relationship between a policy being pursued with respect to this item and that policy as it might apply to other projects in other parts of the country.
I shall take the floor a little later to make it clear that we are prepared to support this project. We think that what is good for New Brunswick is good for the whole of Canada, but at this point I say that the hon. member for Bonavista-Twillingate has a right to ask questions about this matter
Beechwood Power Project Loan in the context in which the government itself has presented it to parliament.


Arza Clair Casselman: I am sorry to have to disagree with the hon. member for Winnipeg North Centre, who undoubtedly is a recognized authority on the rules. He bases his argument on the fact that because something was mentioned in the speech from the throne about this resolution, which is tied difinitely to the authorization of a loan to New Brunswick for the development of a hydroelectric power project at Beechwood on the Saint John river, hon. members in speaking can cover any development in Canada. If that is so, no debate in this house would ever be concluded. If people were permitted to talk about all the places that could be talked about the debate would never conclude and for that reason I still believe the hon. member is out of order.


John Whitney Pickersgill: I shall endeavour, with the greatest difficulty in the world, to relate what I have to say as directly as I possibly can to this particular project. The minister hiihself has said that it was part of a national program. I should like, therefore, to put this question. Is the interest rate available for this Beechwood project to be available only for projects which have not yet been refunded, in the sense the minister used the word, that is to say, for which there are not already bond issues? Is the interest rate to be available for any new project in any particular province that applies for it, or is there some geographical limitation upon this policy? How can an application be made to fulfil the necessary requirements in order to get a loan of this kind?
It is very embarrassing for any one who has to be elected in some other part of the country and who has to justify to his electors -as the Minister of Finance will have to do- the commitment of a large part of the taxpayer's money in one particular place, to say why it is in the national interest, what makes it in the national interest so that we can determine what other projects like it will be in the national interest. I do not think even the Minister of Finance, who has sought to restrict debate in this house in a way that was never before attempted at any time in my experience here, would question our right to know what it is that makes this project in the national interest, what it is that makes this Beechwood project the kind of project that parliament rather than the province should provide the money for and therefore what my constituents or what the people in the province which I represent could do to come within the ambit of this policy. It


Stanley Howard Knowles: Would the hon. member permit a question?


John Whitney Pickersgill: Certainly.


Stanley Howard Knowles: In
view of the reference he made just now to Manitoba I wonder whether he noted that this morning when the Prime Minister answered a starred question about other provincial governments requesting assistance for power projects there was no reference to any such request coming from Premier Campbell of Manitoba.


John Whitney Pickersgill: I do not criticize the Prime Minister in the least for that because I am sure the Prime Minister interpreted that question as meaning any request in the form of a letter or telegram. But I am sure the hon. member for Winnipeg North Centre is as familiar as I am with the brief presented by the government of Manitoba to the federal-provincial conference and therefore to the federal government.


Stanley Howard Knowles: But
you cannot let things drop there.


John Whitney Pickersgill: From the conduct of the Manitoba government in recent months I do not imagine it is very likely to drop that matter.


Mr. Bell (Carleton):: In recent months?


John Whitney Pickersgill: There has been, as the hon. member knows, a great and encouraging development in northern Manitoba in recent months about which all of us who have had a long connection with Manitoba are extremely pleased, and it is going to require, in order to develop it, a great deal of financing. I think any hon. member who represents a constituency in Manitoba, including some of the hon. members who sit on the back benches opposite, would like to have an answer to that question before they vote for this resolution. Certainly if I were representing a constituency in Manitoba I would want an answer to Mr. Campbell's question before I was asked to vote on this resolution.
What I say is this, Mr. Chairman. In default of any answer from the government as to how this policy is going to be applied on a national basis as the Prime Minister said it would be I think we can only assume that the government either intend to give or will by pressure be obliged to give, similar treatment to every project from now on in the future. If we are not to be allowed to debate this project any longer in this house and if we are not to be given any answers by the government to perfectly proper and relevant questions dealing directly with the project or dealing with its relationship to the policy which the government boasted about in the speech from the throne, I think we must act on some kind of assumption and make some

kind of judgment. Because I represent a constituency in the Atlantic provinces where more power development is very badly needed, I certainly do not intend, because I cannot get information to which in a free parliament I should be entitled, to take it out on the people of New Brunswick.


Jean Lesage: On October 29, Mr. Chairman, as reported at page 502 of Hansard, I asked the following question of the Minister of Northern Affairs and National Resources:
Mr. Speaker, I would like to direct a question to the Minister of Northern Affairs and National Resources. Is it his intention to outline to the house the national development policy which is mentioned in the speech from the throne during the current debate on the said speech?
The answer was as follows:
Mr. Speaker, in answer to the hon. member for Montmagny-L'Islet, I think this will be shown in due course.
From that reply we must conclude that the government has a national development policy. The Minister of Finance said so this afternoon and it is mentioned in the speech from the throne. The government, according to its own words-at least in the speech from the throne and from two of its ministers -has a national development policy. If it has a national development policy, surely it is precise in scope. Surely a national development policy requires principles and methods. A national development policy must be applicable to all the regions of Canada. Hence this question which I put to the Minister of Finance and to which I believe I am entitled to a reply.
If this is a national policy for development surely there are rules and regulations and methods which have been set by the government even though we cannot get any information on them. I will put a direct question. Is the present government ready to make a loan to the province of Quebec under the same terms and conditions as this loan to New Brunswick for the development of the Lachine rapids? That is a very simple question, Mr. Chairman.


Arza Clair Casselman: I think the question is strictly out of order.


Some hon. Members:: Oh, oh.


Arza Clair Casselman: The question has nothing whatever to do with this resolution. The only thing you can talk about now is the New Brunswick development and nothing else.


Jean Lesage: With all due deference, Mr. Chairman, I represent a constituency in the province of Quebec. Am I not entitled to
Beechwood Power Project Loan ask this government if the same treatment that is given to New Brunswick is indeed going to be given to Quebec?


Arza Clair Casselman: Yes, on the proper occasion.


Jean Lesage: And to all other provinces.


Arza Clair Casselman: But this is not the
proper occasion.


Some hon. Members:: When?


Jean Lesage: I do not see any other occasion, sir.


Arza Clair Casselman: As a matter of fact there are wide open debates in this house where you can ask anything you wish.


Jean Lesage: With great respect, sir, we cannot ask questions except when we are in committee. I submit that I have a right to know if my province is entitled to the same treatment as another province.


Arza Clair Casselman: You have had six supply motions on which you could have asked anything you wished.


Jean Lesage: Very respectfully, sir, on supply motions we are not in committee and we cannot ask questions.


Arza Clair Casselman: You may ask questions. You may not get the answers but you can ask questions and get them on the record.


Jean Lesage: This government never answers questions when we are on supply motions anyway. Am I to conclude then, from the silence of the Minister of Finance, that the province of Quebec is not entitled to the same treatment as the other province?


An hon. Member:: You would like to conclude that.


Jean Lesage: Well silence means consent as far as I know.


Stanley Howard Knowles: hesitated to rise because I thought the Minister of Finance might want to make some remarks with respect to the comments which have been made since eight o'clock by the hon. member for Bonavista-Twillingate and the hon. member for Montmagny-L'Islet. However, I would like to say, as I implied when I was speaking to a point of order a few moments ago, that we are prepared to support this resolution. I agree with my hon. friends who have had the floor since four o'clock that they have the right to ask the questions they have put to the government and that they have the right to expect answers. However, if the government is not prepared to answer these questions we nevertheless want to make it clear that in our

Beechwood Power Project Loan view it is good for Canada to have such a development as the building of railways in northern Manitoba, it is good for Canada to have the development of power on the Columbia river,-


An hon. Member:: You are out of order.


Stanley Howard Knowles: It
is good for Canada to have the construction of the South Saskatchewan river project-


Jean Lesage: Order.


Stanley Howard Knowles: It
is good for Canada to have an authority respecting the Red and Assiniboine rivers in Manitoba-


Jean Lesage: You are out of order.


Stanley Howard Knowles: -
and likewise it is good for Canada-my hon. friend is too late-to have the Beechwood project constructed in the province of New Brunswick. Therefore, Mr. Chairman although we would like to have answers to these questions which would set the policy of the government in its national context, nevertheless on its own feet we are prepared to support this proposal made by the government.
I think the rest of us in Canada are aware of the fact that the three maritime provinces originally, and now all four Atlantic provinces, have made a significant contribution to the welfare of this country. We are also aware of the fact that geography being what it is, the three maritime provinces in particular have a limited area as compared with the vast resources in the northern parts of all the provinces from Quebec west to the Pacific coast. It is on that basis that we think it is not out of place for Canada as a whole to use some of the wealth of this nation to improve and to strengthen the economy of the maritime provinces. What is now before us is a measure to strengthen the economy of the province of New Brunswick and we think it is not out of place for Canada to render the small amount of assistance involved in lending the money suggested in this resolution and, as I have already said, we think it is good for Canada.
We are sorry that the minister is not prepared to set out more fully the government's alleged national development policy but nevertheless, on its own merits, we are prepared to vote for this resolution.


John Whitney Pickersgill: I should like to put another question to the minister in the hope-probably the vain hope-that he will condescend to give us just a little bit of information. I should like to ask the minister if there are in fact any other projects which in the opinion of the government are comparable with this Beechwood project which the Prime


Minister said was based on a principle applicable to the rest of Canada, or if the Prime Minister was attempting to deceive the house when he gave the answer on November 22-


Donald Methuen Fleming: Mr. Speaker, I rise on a question of privilege-


John Whitney Pickersgill: There is no question of privilege.


Donald Methuen Fleming: I suppose the hon. member having already passed judgment on my question of privilege there is nothing for me to gain in pursuing it but, with his permission Mr. Chairman, I would like to address you on a question of privilege. The hon. gentleman has suggested that the Prime Minister of this country was endeavouring to deceive the house.


John Whitney Pickersgill: I did not.


Donald Methuen Fleming: It is a shameful and most unparliamentary attempt on the part of the hon. member to reflect upon the honour of the Prime Minister and I ask that the slur be withdrawn.


John Whitney Pickersgill: Mr. Chairman, I made no such allegation. If the hon. gentleman had done me the courtesy of listening to what I said he would have noticed that I asked him if there was in fact any comparable project in the minds of the government. I assumed that the Prime Minister was not trying to deceive the house, but I said if so would he tell us what was it, because by his silence, they let it appear that the Prime Minister had been trying to deceive the house?


An hon. Member:: You had better read Hansard.


John Whitney Pickersgill: If the minister will get up and tell us honestly what the Prime Minister meant in answering that question; if he will tell us what projects the Prime Minister had in mind when he gave the answer that there were other projects comparable to Beechwood, then there will be no reflection on the government but if there are no other comparable projects what other conclusion can we draw?


Donald Methuen Fleming: Mr. Chairman, the tight rope walking demonstration of the hon. member does not change the fact that in his previous double barrelled question-


John Whitney Pickersgill: It was a simple alternative.


Donald Methuen Fleming: -he asked me if the Prime Minister was attempting to deceive the house. That is a slur on a member of this house and it is a most unparliamentary reflection and I ask it to be withdrawn.


Arza Clair Casselman: I understood the hon. member for Bonavista-Twillingate to

say that he gave no such meaning to his statement as was taken by the Minister of Finance. If I am correct in that, then there is nothing I have to ask him to withdraw. I should like to ask the hon. member to say whether or not I am correct.


John Whitney Pickersgill: I think, sir, you have put the matter very accurately. I still assume that the Prime Minister was speaking for the government. I think we are entitled to be told what he meant. I think we are entitled to be told what these other projects are which the Prime Minister was talking about. That is all I have been trying to And out all the evening. I want to see a project like Beechwood in Newfoundland; I think the people of Newfoundland are just as much entitled to it as the people of New Brunswick. I happen to represent constituents in Newfoundland, and I want to find out whether there is anything in this national policy or whether the whole thing is a farce. It is perfectly easy for the minister, who has come in here and introduced stage 1 of his policy, to explain this to us. If the government has no policy I can understand his silence, but if they do have a policy why is it being kept secret? Is he ashamed of it? Is there something wrong with it? That is what I should like to find out. That is what I have been trying to find out all evening.
Resolution reported and concurred in.
Mr. Fleming thereupon moved for leave to introduce Bill No. 243, to authorize a loan to the government of New Brunswick in respect of the Beechwood power project.
Motion agreed to and bill read the first time.



ATLANTIC PROVINCES


Francis Alvin George Hamilton: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to authorize the government of Canada to enter into agreements with any of the Atlantic provinces to provide assistance in the generation of electric energy by thermal electric power projects and in the control and transmission of electric energy, and including provisions for the payment of a subvention on coal used in the production of electric energy.
Motion agreed to and the house went into committee, Mr. Casselman in the chair.


Francis Alvin George Hamilton: Mr. Chairman, on December 21, 1957 this house agreed to a motion made by myself that it consider this resolution, which had been recommended
Atlantic Provinces Power Development by His Excellency. The measure which it is proposed to introduce entails financial consequences which will greatly benefit the Atlantic provinces.
As announced in this house on November 14, 1957, by the Prime Minister, apart from the financing of Beechwood, which is being dealt with separately, the present proposed measure would do two things. For those Atlantic provinces who desire such aid the dominion government would build for and sell to the provinces such thermal plants and transmission facilities as may be agreed upon. The second part of the program would consist of granting a subvention on Atlantic provinces' coal consumed for the production of power in the Atlantic provinces. This subvention would be so calculated as to eliminate, so far as possible, the differential in price between coal used in the Atlantic area and coal used in Ontario for the production of power.
We have had from the provinces their estimates of the cost of the construction programs for the fiscal years 1957-58 and 1958-59. For Nova Scotia the program would amount to about $3.4 million, and for New Brunswick it would amount to about $9.3 million, or a grand total of about $12.7 million for those two years. To complete the immediate program thus embarked upon would cost possibly another $3.5 million for Nova Scotia and another $8.5 million for New Brunswick, or a total of about $12 million. Thus the projects presently planned would cost about $25 million.
There will undoubtedly be other programs submitted in future years which will require to be considered by parliament. These cannot be known at this stage, and will depend upon the extent and pace of development in the Atlantic area, and also on whether provinces in that area other than New Brunswick and Nova Scotia wish to take advantage of the program. Hon. members would like to have a forecast of what the program might cost, say over the course of the next ten years.
We have, at present, no program of development put before this government by the governments of Prince Edward Island and Newfoundland. As far as the other two Atlantic provinces are concerned, there might be as many guesses as there are experts on the subject of power. One group of experts who have looked at the question recently, Montreal Engineering Company Limited, estimated that an interconnected program within and between Nova Scotia and New Brunswick might give a total installed capacity of 507 megawatts by 1967 at a capital escalated cost of about $105 million. This would provide
3038	HOUSE OF
Atlantic Provinces Power Development for two plants in New Brunswick, eight in Nova Scotia and the requisite transmission and terminal facilities. This, Mr. Chairman,' is only one estimate of an order of magnitude.
For the purposes of the two fiscal years now in contemplation, a total of $12.7 million for construction of plants and transmission lines will certainly be required. Appropriate items will be included in the further supplementary estimates for 1957-58 and in the estimates for 1958-59. Hon. members of the committee will wish to note, Mr. Chairman, that the amounts of money expended on the construction program will all be refunded with interest so that this phase of the program is a self-liquidating one.
The second phase of the government's program will consist of a subvention on the Atlantic provinces' coal used for the production of thermal electric energy in the Atlantic provinces. For the purpose of this resolution the annual cost of such a subvention is currently estimated to amount to $1.7 million. It will, of course, vary with the amount of coal actually used for power purposes. This sum of money will not be recovered directly. But it is the conviction of this government that the industry promoted and generated by this subvention to the provision of cheaper electric energy in the Atlantic provinces will be worth many times the money expended. Given electric energy at a cost competitive with that available in other areas of Canada the people of the Atlantic region will be in a much better position to compete successfully with all comers in Canada or elsewhere.
Perhaps I should make it clear, Mr. Chairman, that the legislation to be introduced under the terms of this resolution will not in itself appropriate or authorize the expenditure of any sums of money. The legislation is enabling legislation, to permit agreements to be entered into for the program I have outlined. The funds required each year to carry out the program for that year will be sought from parliament in the normal fashion in the estimates. It is the purpose of this government through this and the Beechwood measure to enable the people of the Atlantic provinces to have cheaper electric energy. It will then be possible for them to develop, process and utilize more effectively their natural resources. It will make for a better Canada. It is the first step in what I hope will be a continuing series of measures designed to develop Canada. As agreements in principle are reached with other provinces on projects the pattern of the government's over-all policy for development will become clear.
This program is a co-operative one with the provinces in the Atlantic area. Some hon.
[Mr. Hamilton (Qu'Appelle) .1

members may say that there is nothing in it for Newfoundland or Prince Edward Island That, Mr. Chairman, is not an accurate statement. True, it may be inappropriate for Newfoundland at this time to seek to build thermal plants. However, transmission lines and related facilities, which are, as you know, often very costly-and indeed of great importance in the development of a power system-could be built by the federal government and sold to Newfoundland on the same basis as for Nova Scotia or New Brunswick. The same can be done for Prince Edward Island.
This program of lending aid to provinces which have not shared the advantages of the remainder of Canada in the development of their natural resources will help not only to develop Canada's natural resources in that area, but such a program is among the first steps of this government to speed up the development of Canada's natural resources by Canadians for Canadians.
However important and essential it is, firstly, to obtain thermal power generating and transmission facilities in the Atlantic provinces and, secondly, to obtain them on these advantageous financial terms, the resolution forecasts yet another means of reducing the cost of thermal power in the Atlantic provinces. And it is this means which alone is truly significant in the reduction of the mill rate to the power user. I refer to the subvention on Atlantic provinces' coal consumed in the manufacture of thermal power in these provinces if the provinces so request.
As hon. members know, the coal used in different plants most often has differing heat value. The coal subvention contemplated by this bill will be calculated at that rate per million heat units-technically known as British thermal units

necessary to equalize the cost of the heat in the coal produced and used in the Atlantic thermal plants with the same cost in central Canada thermal plants.
The final and exact figure of the subvention will form part of the agreements to be entered into with the respective provinces. Reports received from 12 plants in Nova Scotia and New Brunswick show that in the 12 months ending August 31, 1957 these plants used 927,257 tons at a total cost of $9,150,580 or an average cost of $9.69 per ton. This coal contained, on the average, 11,885 British thermal units per pound. The average cost per million B.T.U. was 41.51 cents. The central Canada plants consumed during the same period 1,459,881 tons of coal and the cost per million B.T.U. was 34.73 cents. On the basis of these figures, the assistance would be the difference between 41.51 cents and 34.73 cents or 6.78 cents per million B.T.U.

The rate of assistance per ton will vary with the quality of the coal used in the individual plants. For example, a plant using coal with a heat value of 13,325 B.T.U. per pound would qualify for $1.81 per ton at the rate of 6.78 cents per million B.T.U., while another plant using coal of 11,190 B.T.U. per pound would rate $1.62.
After discussion with the premiers of the two provinces which have sought federal aid so far it has been agreed that the assistance will be at a defined rate for a period of five years from the date of the agreement. May I say at this point, Mr. Chairman, how much I appreciated the friendly and co-operative spirit of Premiers Flemming and Stanfield in the meeting I had with them. They most ably represented the interests of their provinces, but when a compromise had to be reached they agreed co-operatively and in a sense of complete understanding.
I should add, Mr. Chairman, that the subvention will not be restricted to thermal plants operated by power utilities or commissions but would also be paid to industrial plants producing thermal power for their own use and for sale. The subvention would be paid to the province's designated agency and the province will be responsible for a fair distribution among power producers.
The subvention on coal for power production based on such a differential and paid on performance should, firstly, give the Atlantic provinces an opportunity of competing more successfully with the rest of Canada from the viewpoint of power costs. Secondly, there will be an indirect support for Atlantic seaboard coal to be used in this region. And, thirdly, there will be an incentive to buy, produce and deliver coal of good quality for the production of the cheapest power possible in the Atlantic region. As I have indicated previously, the cost of the coal subvention for a full year is estimated to be $1,700,000. Such a subvention would be paid from funds appropriated annually for this purpose by parliament.
Hon. members will recall from my statement that the program of work envisaged for Nova Scotia and New Brunswick over the fiscal years of 1957-58 and 1958-59 is of the order of $12.7 million. In the case of Nova Scotia, one 20 megawatt addition will be made to the Trenton thermal plant at a total cost of about $3.2 million. In the two fiscal years mentioned the cost for the Trenton plant would be about $2.3 million. Transmission lines in Nova Scotia and terminal facilities would account for another $1 million.
So far as New Brunswick is concerned, a 50 megawatt plant will be established at East
Atlantic Provinces Power Development Saint John. In the two fiscal years, the cost will amount to about $3.3 million. The ultimate cost of this plant is estimated to be $10 million. Transmission lines and facilities would cost another $6 million in the two fiscal years.
At the end of these two fiscal years the two provinces will be well on their way not only to complete interconnections within the provinces but between both these provinces. This should relieve both these provinces of the necessity of providing immediately for additional reserve or standby capacity as a linked-up system will provide its own reserve capacity and two linked-up systems will provide mutual support to each other.
On the previous resolution, the treasury benches were asked questions about comparative power figures and the Minister of Finance assured hon. members that I would give these during the course of my remarks this evening. The government was asked, what would be the cost of replacing Beech-wood power by thermal power, assuming 300 million kilowatt hours, 6 per cent money and a coal subvention. I should state here that the answer given was that such Beech-wood power would cost between 7 and 7.5 mills. That was the answer I gave earlier in the house and which now appears in Hansard.
It has been estimated that 300 million kilowatt hours produced by a 50 megawatt unit at Saint John financed at 6 per cent would cost about 8.93 mills per kilowatt hour. The coal subvention on such an amount of power, I am informed, would come to about .9 of a mill and thus, in this case, the net cost of replacement power would be about 8 mills compared with 7 to 7.5 mills in the case of hydro power from Beechwood. Therefore, hydro power, even with a subvention on coal at Saint John, is definitely cheaper.


Jean Lesage: Yes, but with an 85 per cent load factor.


Francis Alvin George Hamilton: The figures I have just quoted are based on a 50 per cent load factor. Incidentally, Mr. Chairman, if my hon. friends who pressed me so hard to get a copy of the Montreal Engineering report will look at page 26 they will find that with interest at 7.5 per cent the estimated cost is about 10.65 mills. I am quoting from memory, but I think it is page 26.


Allan Joseph MacEachen: Will the minister permit a question? Could he tell me how many tons of coal would be involved in the production of that block of electricity, 300 million kilowatt hours?


Francis Alvin George Hamilton: For the one
plant at Saint John?
3040	HOUSE OF
Atlantic Provinces Power Development


Allan Joseph MacEachen: Yes.


Francis Alvin George Hamilton: I could not
give that detail offhand. I have seen it but I could not give it offhand. There is one point, Mr. Chairman, which I think is too often overlooked. The New Brunswick and Nova Scotia systems we speak about are to be integrated systems. The Beechwood project will not be used to carry the base load. I heard a good deal of discussion about this this afternoon and I should like to say a word or two about it.
The base load will be carried by thermal power. I am not a power systems engineer, Mr. Chairman, but I am informed that the cost of power is determined largely by what it will cost to meet the peak demand. With two excellent units such as at the new Beechwood plant the cost of peaking will be below that of thermal power. Moreover, further thermal plants will not be needed to meet the peak demands which are growing at a very rapid rate in New Brunswick and Nova Scotia.
The best engineering advice has indicated that the two Beechwood units now being installed can be "used to good advantage for supplying peak power and secondary energy". The same engineering advice recommends the construction of a 50 megawatt unit in east Saint John if immediate interconnection is not available. This same advice recommends interconnections between the two provinces. This is the program we propose to follow which, I feel convinced, will result in a lowering of costs for industrial power and the further development of the natural resources of these Atlantic provinces.
I have spoken tonight on the resolution, Mr. Chairman, and I think that hon. members will realize that in dealing with the problem of a power system in the four Atlantic provinces a good deal of the information can only be brought out properly in the committee stage. But in view of the turn that the debate on the Beechwood resolution took today I want to conclude with one or two observations which I think will bear listening to.
In the first place, when we looked at this problem in the maritimes we were faced with the fact that here was an area in Canada short of power and generally speaking what power they had in these two provinces in particular was very high-cost power. Then we had to take a look at the situation not only from the point of view of handling the power requirements of these two provinces but of fitting them into the over-all national development philosophy.


Jean Lesage: What is that?


Francis Alvin George Hamilton: We were elected on the pledge that we believed in one Canada. This meant that people in all parts of Canada and all groups in Canada would have equality under a Progressive Conservative government.


Jean Lesage: Mr. Chairman, I rise on a point of order. Do I understand that under this resolution it is all right to discuss the national development policy of the government?


Arza Clair Casselman: As a matter of fact, I think the minister was out of order in the last statement he made.


Francis Alvin George Hamilton: Then I am to understand that discussion on the resolution we are now considering will be confined entirely to thermal projects and transmission lines as clearly outlined in the resolution.


Some hon. Members:: Oh, oh!


An hon. Member:: You asked for it.


Arza Clair Casselman: In the extended resolution but no further than that. I see the hon. member for Montmagny-L'Islet.


Francis Alvin George Hamilton: I should like to complete my statement, Mr. Chairman.


Arza Clair Casselman: I am sorry; I
thought the hon. gentleman had finished.


Francis Alvin George Hamilton: I want to go back to the second part of my observations. The Atlantic provinces are a power deficit area, an area which presented tremendous economic difficulties in working out the thermal power grid problem. We recognized that every device possible had to be used to achieve the aim of the government which was to provide cheaper power in this area. The devices used were first of all the usual device of interconnections. Second, there was the use of a coal subvention. Third, there was the question of tying in the hydro power in the plants already existing in the two provinces with the basic thermal plants to give maximum efficiency.
May I give hon. members one figure which I think will be useful in this debate. If we had kept the two provinces separate we would have had to build 16 plants while this integrated system only calls for 10 plants. By the combination of the thermal and hydro plants in one province together with the combination of such plants between the two provinces we were able to cut the cost little by little until I think we have reached the objective that was so necessary to attract industry to the Atlantic provinces at a figure approaching 7 mills.
I thought that when I came to the house with this information there would be general

Atlantic Provinces Power Development
support among all parties and I felt very proud indeed that as a new member of the house I should be allowed to play a part in one of the moves that will help one part of Canada to achieve some measure of economic uplift that has been so badly needed.


John Whitney Pickersgill: Mr. Chairman, before my colleague proceeds I have one very brief question I should like to put to the minister. If I understood him correctly, he said that the policy of assisting in the development of plants would apply only to Nova Scotia and New Brunswick. Does that mean that the government has not accepted the request of the premier of Newfoundland that modification be made to permit ' assistance to hydro plants as well?


Francis Alvin George Hamilton: Mr. Chairman, one point I made in my statement was that we had worked out this program with the two provinces which had asked for help. At their request we confined the matter to thermal plants and, although I hardly dare mention it after the discussion we have had, to Beechwood. So far as power costs are concerned, the hydro and thermal plants are interconnecting and we expressly framed the legislation so that the other two provinces could be included if they could establish a need for thermal plants, although at the moment I do not think that is apparent.
Somebody asked me a question last fall about nuclear energy which is not something to be ignored in the long-range picture in these power-short areas. The terms of the legislation apply only to thermal plants and interconnecting lines regardless of whether they carry thermal or hydro power within or between provinces. Transmission lines may be very much needed in Newfoundland and they could be covered. I think that is about the extent of the question.


John Whitney Pickersgill: I am not quite dear about one point. Would a thermal plant in Prince Edward Island or in Newfoundland, if there were any such projects, come within the ambit of the minister's proposal?


Francis Alvin George Hamilton: Yes. May I just repeat this to be absolutely clear. If there were a thermal plant required in Newfoundland or if there were any kind of thermal plant required in Prince Edward Island, they could come under the terms of this measure. If there were transmission lines required in any one of the four Atlantic provinces, they would come under this measure.


Jean Lesage: Mr. Chairman, the Minister of Northern Affairs and National Resources said that he was proud to outline this program for the building of thermal plants and
transmission lines in the Atlantic provinces.
I am proud that he feels proud, because after all he was just dealing with the implementation of Liberal policy which was announced in this house by Mr. Harris in his budget speech on March 14 last. I, myself on April 9 gave more details about the project which was being developed by the previous administration to build thermal power plants and transmission lines for interconnection purposes in the Atlantic provinces. The statement I made at the time was a comprehensive one and an outline of the plans we had in mind can be found at page 3293 and following of Hansard for last session. The object of the then government was to secure power at the lowest possible cost, and at the same time use maritime coal as the fuel for that purpose. I said at that time, and may I quote from page 3294 of Hansard for April 9, 1957:
It has been decided that an immediate study should be undertaken to determine what new capacity may be required in the two provinces-*
That is in Nova Scotia and New Brunswick.
-and, having regard to possible new interconnection lines, what would be the most effective and economic location. This study will be undertaken by Montreal Engineering Company as consultants for the Northern Canada Power Commission. The study will be carried out in full consultation with the power commissions of the two provinces.
The report of the Montreal Engineering Company was expected in the month of August. In the meantime there was correspondence between the authorities in Nova Scotia and New Brunswick and myself. There were meetings of the officials of the two provinces and of the department to settle all possible details and be ready to proceed at once when the report of the Montreal Engineering Company was received. When the present government took over we had made good progress in our discussions with the provinces.
According to the correspondence which has been tabled in this house, negotiations between my immediate successor, now the Minister of Agriculture, and Mr. Flemming, the premier of New Brunswick, continued in July. In the first days of August the report of the Montreal Engineering Company was received by the government and copies were sent to the premiers of Nova Scotia and New Brunswick. The report has now been tabled in this house. This report contains very definite recommendations. On November 14, when he tabled the report, the Minister of Northern Affairs and National Resources had this to say, and I quote from page 1102 of Hansard for the present session:
In doing so-
3042	HOUSE OF
Atlantic Provinces Power Development
That is tabling the report.
-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.
This report contains definite recommendations, seven in number, which can be found immediately after the chapter entitled "Findings". I do not believe it is necessary to read them at this stage, but I certainly would like the Minister of Northern Affairs and National Resources to tell the committee- if I could have his attention for a moment, I am making a request of him. I said that the report of the Montreal Engineering Company contains seven very definite recommendations. I should like the minister, when he replies, to tell the committee if each one of those recommendations has been accepted and what action has been taken, if any, on each of them. I ask this question in the light of the comments made by the Minister of Northern Affairs and National Resources which I quoted a few moments ago, comments made in this house on November 14. I ask the question also in the light of the comment made on the report in a letter dated September 6 last and written by Mr. R. E. Tweeddale, chief engineer of the New Brunswick Electric Power Commission, to the premier of New Brunswick.
In the correspondence which was tabled in this house, according to an order of the house on a motion by the hon. member for Gloucester, there is a copy of a letter written by the premier of New Brunswick on October 11 to the Prime Minister, enclosing a copy of his comments on a memorandum of the Minister of Northern Affairs and National Resources dated September 30 and entitled "Power Problem in the Atlantic Provinces". As was said the other day on a question of privilege by the hon. member for Gloucester, this memorandum of the minister has not been tabled with the correspondence, and with the comments on such memorandum. All members of this committee are placed in a position where it is impossible to weigh the criticisms made in the comments of the premier of New Brunswick against what is described as the "memorandum of proposals of the Hon. Alvin Hamilton". I am sorry I am giving his name, sir, but this is the title of the paper to which I am referring.
There are four pages of these comments and at one point, on page 3, it is said that the Minister of Northern Affairs and National

Resources does not conform to the principles which have been discussed over the last six months by representatives of the government of Canada and representatives of the governments of New Brunswick and Nova Scotia. In his comments the premier of New Brunswick outlines his opinion of the main conditions of the agreement to be reached. I would again ask the Minister of Northern Affairs and National Resources if he would kindly table the memorandum in order to make it possible for members of the committee to understand exactly what has happened between him and the premier of New Brunswick and to know what the attitude is, on the one hand, of the premier of New Brunswick and, on' the other, of the present government.
I should like to know what has been done about the criticisms of the premier of New Brunswick to try to satisfy him. These criticisms are contained in those comments I was mentioning, and they can be found at pages 95 and following of sessional paper No. 117. According to the program that was outlined by the then minister of finance and myself last spring, the thermal plants and the transmission lines were to be built by Northern Canada Power Commission after tenders were called and in the usual course the contracts were to be allotted to the lowest tenderers in a position to fulfil the contract, and this would be done in co-operation with the province.


Donald MacInnis: Would the hon. member permit a question? How can you tie in the statement with the statement made by your then leader in New Brunswick when he said that if power could not be produced at a reasonable cost in the maritimes, the maritimes would have to do without the power? How can you tie it in with the statement by the then prime minister that coal was too valuable a product for future generations and should be left in the ground for the manufacture of synthetic materials? How can you tie it in with the former minister's statement-


Stanley Howard Knowles: Perhaps the hon. member would address the Chair as is required in this house.


Hédard-J. Robichaud: He would rather be outside.


Donald MacInnis: I apologize, Mr. Chairman. I do not have the experience enjoyed by these other hon. members and I may be carried away by my feelings.


The Acting Chairman (Mr. Chown):: Perhaps the hon. member would confine himself to asking his questions one at a time.


Jean Lesage: I do not know what former leader in New Brunswick the hon. member was referring to.


Donald MacInnis: The former prime minister.


Jean Lesage: I have here a transcript of the speech he made in Fredericton on May 23. Is that the one the hon. member is referring to?


Hédard-J. Robichaud: He would not know the date.


Jean Lesage: I quote this transcript:
Our offer is to collaborate with the provincial governments and their power agencies to get for the people of New Brunswick and Nova Scotia power at the cheapest cost that may be made available (applause).
And rightly so. That was exactly the program.


Donald MacInnis: If the Chair will permit me to say so, I am not at all surprised at the prime minister.


Hédard-J. Robichaud: Get outside of the house and fight it out.


Gordon Campbell Chown: Would the hon. member confine himself to questions.


Jean Lesage: If I allow questions, and I usually do so.


An hon. Member:: You are afraid of them.


Jean Lesage: I am not afraid of questions. I have never been afraid of questions. I believe I should be the last member to be accused of being afraid of questions, in spite of the fact that I am not speaking in my own mother tongue, and that when I came into this house in 1945 I could hardly speak a word of English. I have no lessons to receive from those hon. members.
Mr. Chairman, when I was interrupted by an hon. member who would rather settle this question outside of the house, I was saying that last year our proposal was that the Northern Canada Power Commission would build the thermal plants to be established in Nova Scotia and New Brunswick and also the transmission lines under the tender system. I am asking the minister whether he has reached agreement with the provinces to the effect that this part of the program stands.
I should like the minister to tell the house under what conditions these plants and transmission lines will be operated. The Prime Minister, when he mentioned this program on November 14, said I believe that these plants and transmission lines would be sold at cost to the provinces, as we had intended in the program I outlined in April last, whenever
Atlantic Provinces Power Development they wished to purchase them. Do I understand that until the provinces have purchased the new installations these installations will be operated by the Northern Canada Power Commission? When the Northern Canada Power Commission operates these plants and transmission lines how will the cost of power be calculated? On what rate of interest? Will it be the same as our proposal which was the current rate of interest for crown corporations? What will be the depreciation or amortization period for transmission lines with steel towers? Will it be 40 years as we had proposed? What will it be for the thermal plans? Will it be 30 years as we had proposed? When they are turned over to the provinces who want to purchase them, what will be the period over which the provinces will be allowed to repay or will they have to repay on a cash basis? All these are questions which I believe are pertinent and which I suppose will be part of the agreements that the resolution seeks authority to conclude with the provincial government.


Alfred Johnson Brooks: It is very easily answered.


Jean Lesage: I hope it is, because it was all arranged before you took over.


Alfred Johnson Brooks: That is not a big problem.


Jean Lesage: The answer is always easy when it has been arranged before this government took over.


Alfred Johnson Brooks: They did not know what the cost was going to be.


Jean Lesage: In a moment I am going to say a word about cost. I am coming to that matter now. Before I resume my seat I just want to say a word about the cost of power. According to the report of Montreal Engineering, which was received by the government on August 1 after this government had taken over, this is the situation. This can be found at page 5 of the findings:
The average annual load factor in the maritimes is about 50 per cent. On that basis, and using Sydney coal, steam power produced in New Brunswick in 1960 in a large new power station, financed by public funds, would cost approximately 11 cents per kilowatt-hour.
When I asked the minister a question at the end of his speech the minister referred me to pages 26 and 27 of the report of Montreal Engineering. There the cost per kilowatt-hour at 50 per cent load factor is mentioned as being at this time, for a 66 megawatt thermal plant firing coal, 11.35 mills per kilowatt-hour. The figure the minister has given in answer to the question asked by the hon. member for Inverness-Richmond about the cost of power at Beechwood with two units was 7 to 7.5 mills per kilowatt hour.
3044	HOUSE OF
Atlantic Provinces Power Development But as I said, if he looks at his answer he will find it is based on an 80 per cent to 85 per cent load factor. The Minister of Finance this afternoon, when I asked him a question as to how much more it would cost per kilowatt hour on a 50 per cent load factor, just said, "it will be proportionately higher". I should like to know how much more it would be.
The minister has very competent officials and I hope that tomorrow he will be able to give me a reply and to give me the exact figure in mills so that we can compare the cost at Beechwood on a 50 per cent load factor with the cost of power from a 66 megawatt thermal plant, firing coal, at East Saint John on the very same basis. In view of these figures that have been mentioned and the one he mentioned a few moments ago when he said he thought the East Saint John plant would produce power at a cost of 8.93-I think that is the figure he gave-


Francis Alvin George Hamilton: 8.93.


Jean Lesage: I suppose that is a 50 per cent load factor because of the difference of the figures I find in the Montreal Engineering report. When the minister replies, I would like an explanation as to the discrepancy between his figure of 8.93 mills and the figure mentioned in the Montreal Engineering report at page 27 of 11.35 mills. I would also like the minister to comment on these figures in the light of the letter which was addressed to his immediate predecessor the Minister of Agriculture, on August 6, 1957, by the premier of New Brunswick from which I would now like to quote:
I am attaching copy of letter which I have received from Mr. John C. Udd, president of Stratmat, Ltd., providing, in some detail, information as to the probable power requirements of the proposed ferromanganese project of the Stratmat company in the Woodstock, New Brunswick area.
As you will note, a price of 7 mills for power will be an essential requirement in the plans for development. It will be seen the immense importance of the-
This is not too well copied by your department.


An hon. Member:: You trained them well.


Jean Lesage: I did not train them. I continue:
-importance of the price of power to the New Brunswick Electric Power Commission in this, as well as in other mining projects.
Attached is a copy of the letter from Mr. Udd as mentioned in the letter of Mr. Flemming, confirming that his company is ready to go on as long as the electric power can be obtained at a price not to exceed 7 mills per k.w.h.


I would like the minister to comment on this and to know what kind of representations he has received from the premier of New Brunswick in the light of the Montreal Engineering report, especially as to the cost mentioned in that report.
This, as I have said, is a continuation of Liberal policy. It is the implementation of a policy which had been conceived and developed under the previous administration. I welcome it and I hope the answers I will obtain to the questions I have asked will prove that the only thing the Minister of Northern Affairs and National Resources, his government and his officials can do is really to try to improve what had already been so well done.


Mr. Macdonald (Vancouver-Kingsway):: In
rising to say a few words in support of this resolution before the committee I note and am glad that the minister has said that he has been acting at the request of two of the provinces and I assume from that there has been good co-operation between the federal government and the two provinces in question. What would have been the situation if these provinces had not asked for the assistance of the federal government in their power projects? What would have been the situation if they had run after private money elsewhere at greater cost, rather than even make a request for assistance from their own national government? What would have been the situation had they run, say to the Krupp interests or to the Wenner-Gren interests who were so closely allied with the nazi war effort which so recently came to its dismal conclusion rather than to seek support in a national development program?
As one member of this house I want to say to all other hon. members that I was shocked and dismayed to see that this had been the attitude of the British Columbia government with respect to the development of the Columbia basin. Certainly ever since this government took office, according to starred question No. 45, the British Columbia government has not even requested assistance in the development of the Columbia basin.


John (Jack) Henry Horner: Mr. Chairman, I think we are all pretty well agreed that these measures serve to implement Conservative policy and Liberal promises. I recall very well during the last campaign picking up the Liberal manifesto of the 1949 election when these very resolutions which we are introducing here tonight were the crux and the basis of the Liberal campaign at that time. It has always been the task of a Conservative government to implement Liberal promises and I feel quite certain that our sincere friends

on the other side of the house will not hesitate to give this measure the support it deserves.
This resolution, like the one that was presented today to the house for Beechwood, confirms in a very concrete manner the determination of this government to carry out to the letter the program of our party as it was explained to the people of Canada before and since the general election. We who sat on the opposite side of the house while the former government dilly dallied and pussy footed around and ignored our just and long unanswered demands know how the present opposition-the long to be opposition-ignored the long neglected rights of the Atlantic provinces. All that is needed is a review of our demands over the years and the do-nothing reaction these demands received from the former government to understand very clearly the record of the late Liberal party as being one of indifference, inaction and downright irresponsibility toward the people of the maritime provinces.
In the long and colourful history of the maritime provinces the rights of those provinces have stood out as being neglected by the federal government. I think we must recognize that our economic troubles in the maritime provinces really began with confederation. The promises and the considerations upon which the maritime provinces of Nova Scotia and New Brunswick-


John Whitney Pickersgill: On a point of order.


John (Jack) Henry Horner: -entered confederation-


John Whitney Pickersgill: On a point of order, in the light of the rulings of the previous chairman I wonder how the hon. member relates what he is saying to thermal plants?


John (Jack) Henry Horner: I am merely reciting these points to illustrate and lead up to my main point which is that we in the maritime provinces are very grateful now that we have finally got a government in Ottawa which will recognize our rights and do something about them. One has only to consider the history of the maritime provinces since confederation and the inaction on the part of the Liberal government for the past 20 years.


Gordon Campbell Chown: Order. Would the hon. gentleman please confine himself to the contents of the resolution before the house.


John (Jack) Henry Horner: The only purpose in my rising this evening is to say how grateful we are in the maritime provinces that at last we have a government which is prepared to do something, and not a government such as we had previously. I can recall when I was sitting as a member of the opposition getting up time after time to ask the prime
Atlantic Provinces Power Development minister when he was going to buckle down and do something for the maritimes; I can recall one occasion when I accused the former government of staging a sit down strike, and the prime minister answered: I wish the hon. member for Restigouche-Madawaska would go on a sit down strike himself-


Gordon Campbell Chown: I am
sorry, but I must ask the hon. gentleman once more to confine his remarks to the resolution.


John (Jack) Henry Horner: It is indeed an honour, Mr. Chairman, to support this resolution. It may be very useful to say a word or two to hon. members of this house who do not come from the maritime provinces on the advantages it will bring us from a trade point of view. The development of our industry is based upon power; it is based upon power co-ordinated with transportation. If the maritime provinces had one advantage before confederation it was cheap transportation by water, and if there is one thing which has hindered our progress since confederation it is transportation difficulties coupled with the lack of power.
I am not averse to mentioning a subject which was touched on by the hon. member for Montmagny-L'Islet a few minutes ago. I recognize that this problem has been under study by the previous government. That is to their credit. What is not to their credit is that they did not have the stamina to enforce that policy while they were in office, and it has remained for this government to take the initiative to put into action the policies which are embodied in this resolution.


Hédard-J. Robichaud: Mr. Chairman, the hon. member who has just resumed his seat stated that the present solution is a combination of Conservative policy and Liberal promises. In order to put him straight I would point to the first part of the memorandum from the premier of New Brunswick, tabled as Sessional Paper 117, part of which reads as follows:
The government of New Brunswick has reviewed the memorandum of the Hon. Alvin Hamilton, the Minister of Northern Affairs and National Resources, relating to federal assistance with electric power development in New Brunswick and Nova Scotia. The review has been carried out against the background of a considerable number of documents and correspondence beginning with the so-called "budget proposals" of March 1957 and continuing through a series of conferences by representatives of the two provinces with the present federal administration and its predecessor.
Now, Mr. Chairman, the resolution before the committee at this time has to do with a measure to authorize the government of Canada to enter into agreements with any of the Atlantic provinces to provide assistance in the generation of electric energy and
3046	HOUSE OF
Atlantic Provinces Power Development thermo electric projects, and also in the control and transmission of electric energy together with provisions for the payment of subventions on coal used in the production of electric energy. It is, as stated by the hon. member for Montmagny-L'Islet, but the implementation of a policy initiated last spring by the previous administration.
In the correspondence and documents tabled under Sessional Paper 117-B we had access to the correspondence which took place since the announcement made by the former minister of finance in presenting his budget on March 14, 1957. Included in this sessional paper was a letter from the premier of New Brunswick to the Prime Minister of Canada, under date of October 11, 1957, which read as follows:
My dear Prime Minister:
I am enclosing a copy of my comments on the memorandum of Hon. Alvin Hamilton, dated September 30, in connection with "Power Problem in Atlantic Provinces", which, I trust, will be helpful to you in presenting our point of view.
With best wishes,
Yours sincerely,
Hugh John Flemming
Also attached to this letter was a memorandum from the premier of New Brunswick on the proposals of the Minister of Northern Affairs and National Resources relating to financial assistance with power development in New Brunswick and Nova Scotia. Yesterday, rising on a question of privilege, I asked the minister for the tabling of this proposal which was not included in the sessional paper, and I stated rightly that it was part of the documents which were asked for following a return to an address of the House of Commons, dated November 6, 1957, for a copy of all correspondence and other documents exchanged between the federal government or any of its departments and the governments of the provinces of New Brunswick and Nova Scotia or their respective power commissions, from April 1, 1957 to date, regarding the development of electrical energy.
In his reply the Minister of Northern Affairs and National Resources stated that the document referred to was a private document that was circulated to certain of his colleagues. It was concerned, stated the minister, with basic Conservative policy, not government policy, on development with application to the Atlantic provinces, and he added, I quote:
A copy was shown to the premier of the province of New Brunswick. My department advises me that they did not consider it as part of their records and since it was not used in the department, it is not part of the documents requested.


Mr. Palleii:: On a point of order, Mr. Chairman, the hon. member is now speaking on a subject with regard to which a comment was made by the Speaker when the house was sitting, and he will recall that at the time the Speaker advised him that if he wished to pursue the matter further the proper course would be to bring forward a motion for the production of that particular paper. I suggest to you, Mr. Chairman, that this is not the time to discuss this matter.


Hédard-J. Robichaud: Mr. Chairman, the document which I am discussing now has a direct relation to the resolution before this house. It is a document which has to do with correspondence and documents relating to the development of electric power and thermal plants in the Atlantic provinces.


An hon. Member:: How do you know?


Hédard-J. Robichaud: We do know, judging from the comment made by the premier of the province of New Brunswick on this particular document.
The motion for production of papers which was approved by this house clearly stated:
A copy of all correspondence and other documents exchanged between the federal government or any of its departments, and the governments of the provinces of New Brunswick and Nova Scotia or their respective power commissions.
How can we take it for granted that the federal proposal was only shown to the premier of New Brunswick as stated by the Minister of Northern Affairs and National Resources when in his letter to the Prime Minister the premier of New Brunswick says: "I am enclosing a copy of my comments on the memorandum". How can it be considered as a private or secret document when the comments of the premier of New Brunswick on this very proposal were tabled in this house on January 3? This again is clear evidence of the attitude of the present government, and at this point I feel I am justified in using the very words of the Prime Minister when, in his final television broadcast on June 5 last, five days before the general election, he said:
Day by day, week by week, as parliament met, these men determined that they would not furnish information and refused information over and over again.
These words of the Prime Minister are so readily applicable today to the present government that I feel justified to apply them in this particular case just as well as they were applicable when the Beechwood bill was discussed earlier.
Without having seen the federal proposal, if we are to judge from the memorandum showing the reaction of the premier of New Brunswick we must conclude that the

unqualified acceptance of the proposal would entail specific points of difficulty in the conclusion of any agreement. For instance, in his reply the premier of New Brunswick stated that the method of financing power development outlined in the proposal entailed rates of interest considerably in excess of anything proposed to date by the government of Canada to the government of New Brunswick.
It is further stated that if the rate of interest for power development should be substantially above the federal long term rate, and if the price of power from new generating units financed with federal assistance was to be based on the principle of earning 5 to 6 per cent on invested capital, as stated in the memorandum which has been refused to us for obvious reasons, then the price of power would be at a level which would completely discourage development by high load factor power users in the pulp and paper industry and in the metallurgical industry.
It is clearly stated that the memorandum does not conform to the principles which have been discussed over the last six months by representatives of the government of Canada and representatives of the governments of New Brunswick and Nova Scotia, and which were dealt with in detail at the meeting held in Ottawa on August 13 and 14 between the Prime Minister of Canada and certain of his officials, and the premiers of New Brunswick and Nova Scotia and certain of their officials.
In its report of the power supply of New Brunswick and Nova Scotia for the Northern Canada Power Commission, the Montreal Engineering Company made certain recommendations which I think should be placed on the record:
(1)	That the additional power that will be required in New Brunswick and Nova Scotia in the next decade be generated in the main in a number of large steam plants feeding into an interprovineial grid. Any hydro power that can be obtained to better advantage should also be developed.
(2)	That the steam plants be located where they will be reasonably close to the load centres, have rail connections with the Sydney and Pictou coal fields, and be on tidewater, so that coal and oil can be purchased in the cheapest markets.
(3)	That the sites for such steam plants be Saint John, Halifax, Trenton and Sydney, and possibly given sufficient increase in load in northeastern New Brunswick, near Chatham or Bathurst.
(4)	That the electric utilities endeavour to complete the interconnections between their power systems by the end of 1959, the transmission lines to be single circuit and operated initially at 138 KV. As regards the new sections of line that will complete the link between Saint John and Halifax, serious consideration should be given to designing them so that they can eventually be operated at 230 KV.
(5)	That the utilities also do their best to work out an agreement between them that will provide
Atlantic Provinces Power Development for the orderly installation of additional generating capacity and for the sharing of the cost of spare capacity.
(6)	That if an adequate interconnection cannot be arranged in the near future, the 50 megawatt unit now on order by the New Brunswick Electric Power Commission be installed in Saint John with all possible dispatch.
(7)	That if the completion of an adequate interconnection between the New Brunswick and Nova Scotia power systems can be assured, and if no unforseen increase in load develops, the installation of the first unit in the new steam plant in Saint John be deferred until 1961, and if cancellation and other charges are not excessive, consideration be given to increasing its capacity substantially.
It appears obvious that in view of this recommendation, and judging from what has been said so far, the government has decided to proceed with the installation of large steam plants feeding into an interprovineial grid. At this point, I want to urge the government to give very serious consideration to the location of the plants to be built in the next year or so in order to provide the necessary power for the development of our mining resources. The Brunswick Mining and Smelting Corporation have already announced their decision to proceed with the construction of a lead and zinc mill and also with a lead smelter at Caron Point, near Bathurst. The Prime Minister on September 27 last, made the announcement that the government was prepared to share in a major harbour development at Bathurst in conjunction with the mining company's plans for a $20 million expansion and development program in that area. Such a project if realized would have automatically required a substantial output of electrical energy and it would only have been logical, practical and economical that such thermo plants be constructed at Caron Point at the proximity of the load centre required by this proposed mineral expansion. Furthermore, Caron Point would have offered year-round deep-water facilities in addition to its rail connection which could make it an ideal site for such a proposed unit.
When the increase in load will be required in eastern New Brunswick it will naturally originate from the development of our mineral deposits and I was hoping that the government would be practical in choosing the Caron Point site for its first thermo plant, thereby taking advantage of relatively cheap transportation, the most advantageous in the province for the coal or oil required for the operation of the plant. Unfortunately, the announcement made in the last few weeks by the Brunswick Mining and Smelting Company to the effect that their operations would be curtailed for a certain period has greatly upset the people in Gloucester county and

Business of the House the entire population of New Brunswick. I understand the officials of this company were in Ottawa during the week of December 15 and that discussions took place at that time.
Progress reported.



BUSINESS OF THE HOUSE

Mr. Marler:: Mr. Speaker, could the leader of the house tell us what business we shall be taking tomorrow and the following day?


Howard Charles Green: Mr. Speaker, tomorrow we shall continue with this resolution and then take the estimates of the Department of Justice, the Department of Fisheries and the Department of National Revenue.


George Carlyle Marler: Is the house leader in a position to say whether we shall go on with that program on Friday?


Howard Charles Green: So far as I can say at the moment, we will be continuing with these estimates on Friday.


Stanley Howard Knowles: And
Saturday?


Howard Charles Green: Now, do not ask too much!


John Whitney Pickersgill: That would be taking us into your confidence.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to the order of the house passed on December 2, 1957.

Question

[Stage Direction]
The following answer, deposited with the Clerk of the house, is printed in the official report of debates pursuant to standing order 39:

Mr. Ellis: 1.	Is the Post Office Department making reductions in the staff at the Regina post office now or in the immediate future?
2.	If so, in what branches or categories of service have, or are these reductions to be made?
3.	What is the reason for the reduction, or proposed reduction, in each instance?
4.	On whose advice or recommendation was the decision made?
5.	What provision is being made for employees affected by present or proposed staff reductions?
Answer by: Hon. W. M. Hamilton (Postmaster
General):
1.	The strength of the staffs at all larger post offices is under constant review and, when warranted, additions or reductions are made. At present the staff of part-time employees at Regina is under study but no decisions have yet been made.
2.	See answer to No. 1.
3.	See answer to No. 1.
4.	Decisions are usually based on the recommendations of senior field officers.
5.	Employees affected by staff reductions are assigned, where possible, to existing vacancies.

Thursday, January 9, 1958



MISCELLANEOUS PRIVATE BILLS

[Stage Direction]
Seventh report of standing committee on miscellaneous private bills.-Mr. Rea.