Manitoba Hansard — Sitting 85 (30th Legislature, 2nd Session)

30-2-85

Manitoba — Debates (Hansard)

THE LEGIS LATIVE AS SEMBLY OF MANITOBA 2:30 o'clock, Wednesday, May 14, HJ7G Opening Prayer by Mr. Speaker. INTROD UCTION OF GUES TS 25G3 MR. SPEAKER: Before we proceed I should like lo direct the attention of lhe honourable members to the gallery where we have 19 students, Grade 8 to 10 standing of the Morweena School . These students are under the direction of Mr. Siemens . This school is located in the constituency of the Honourable Member for St. George, the Minister responsible for the Manitoba Public Insurance Corporation .

We have 27 students, Grade 5 standing of Hobertson School under the direction of Miss Schroeder. This school is located in the constituency of the Honourable Member for In kster, the Minister of Mines, Resources and Envi ronm2ntal Management. And we have 16 students, Grade 7 and 8 standing of Kinloss Elementary School from North Dakota under the direction of Mr. Buck. And 40 students, Grade 6 standing Sacred Heart School from East Grand Forks, North Dakota under the direction of Mr. Kuznia and Miss Maves. On behalf of all the honourable members I welcome you here this afternoon.

Present ing Petitions; Reading and Receiving Petitions; Presenting Reports by Standing and Special Committees; Ministerial Statements and Tabling of Reports. The Honourable Minister of Health. TABLING OF REPORTS HON. LAURENT L. DESJARDINS (Minister of Health and Social Development) (St. Boniface): Mr. Speaker, I'd like to Table the Return to and Order of the House No . 1 of March 17, 1975. MR. SPEAKER: Any other Ministerial Statements or Tabling of Reports. The Honour able Minister of Mines. HON. SIDNEY GREEN, Q. C. (Minister of Mines, Resources and En vironmental Manage ment) (Inkster): Mr.

Speaker, I wonder if it would be agreeable to have a meeting of the Private Bills Committee on Tuesday at 10 if il's agreed, Mr. Speaker. MR, SPEAKE R: Notices of Motion; Introduction of Bills; Questions: Orders of the Day. The Honourable House Leader. ORDERS OF THE DAY MR. GREEN: Mr. Speaker, I would like to move, seconded by the Honourabl e the Attorney-General that Mr. Speaker, do now leave the Chair and the House resolve itself into a Committee to consider of the Supply to be granted lo Her Majest.v.

MOTION presented and carried, and the House resolved itself into a Committee of Supply, with the Honourable Member for Logan in the Chair. COMMITT EE OF SUPPLY - CAPITAL SUPPLY MR, CHAIRMAN (Mr. Jenkins): I refer honourable mcm1Jers to the Capilal Supply motions before the House. �l'heclulc A - Manitoba Hydro Electric Board. The Ilomrnrable First Minister. HON, EDWARD SCHREYEH (Premier) (Rossmere): Well, Mr.

Speaker, just to follow up on one of the questions that was asked the other dav and which l did not reply' the same day, was a question b.1· the Honourable Member for Hie) with respect lo tbe allocation of costs in the c>ase of the Jenpcg construction as between generation and regulation. I eoulrl not a nsw er il any better than it is on Page �O of the transcript of the Standing Committee meeting of April 1. So I would merel_v refer the honourable member to Page 20 of the April l meeting of tbe Tltililies Committee. MR. CHAIHMAN: The H onourable Member for Hie!. MR. DONALD W.

CHAIK (Hiel): The further part of the ques tion, M1', C hai r ma n, 11·as the breakdown of the capital mone:vs requested for capital im·estment in the project a.s opposc·d to that for carrying charges, and the further question was whether or not ,Jenpeg wa.s going to be carried capitalizing the interest charges until such time as all the plants down:;tream from it

256 4 May 14, 1975 SUPPLY - CAPITAL SUPPLY (MR. CRAIK cont'd) .. ... were going to have assumed part of the costs. In other words, the Jenpeg plant it isn't just the place of generation at Jenpeg plus recreational or other reasons for es tablishing it, it's a case of also taking the

part invested in generation and then proportion ing it out over the other plants . The question was, how much of the cost of Jenpeg are going to be capitalized and for how long until this is paid off by the other plants downs tream from it? MR. CHAIRMAN: The Honourable First Minister . MR. SCHREYER: Well, Mr . Speaker, I'm not sure that the honourable member's question lends itself to any definitive answer. Clearly there is an imputing of cost, or alloca tion of cost, as between generation and Lake Winnipeg Regulation.

As to how much of that total cost relates to financing charges or interest, that is in the order of $3 0 million . With respect to the allocation in turn of the regulation costs, Lake Winnipeg Regulation, if one has to impute that to any given power plant it would have to be imputed to the entirety of power plants that lie downstream, that are located downs tream of that. I'm sure my honourable friend is quite aware of that, so I'm not sure that that in fact is what he's asking about. MR.

CRAIK: ..• if there's any rough breakdown even of the ... the last day the First Minister said that the capital requirements for interest purposes was in the order of 30 - odd million. I wonder if there is any breakdown of what portion of the 30 million of 30 -odd is Jenpeg, and what portion is the other facilities that have been developed ?

MRo SCHREYER: Well very very roughly of the 33 million I would think that approxi mately 40 to 50 percent would be related to Jenpeg generation and the balance would be relating to regulation, which in turn would have to be apportioned among all downs tream plants in relation to their capacity. MRo CRAIK: Well I think that answers the question then, Mr . Speaker, if it's 40 to 50 percent, then it's roughly $15 million, and I would then conclude that that portion is probably going to be carried on a continual basis until those plants are built.

I question whether this, at this point, isn't postponing a pretty sizable chunk of capital for repayment. Under the cir cumstances to charge ... one-half of our interest cost being on Jenpeg alone . MRo SCt::REYER: Well, Mr . Speaker, I am not aware of any unusual treatment of interest costs with respect to the Lake Winnipeg project and Jenpeg. As the Member for Riel I'm sure is aware, the interest costs are transferred to operating account at the time when the project goes into service, and that I believe to be a very conventional and historic treatment by any utility, including Manitoba Hyrdo. MR.

CHAIRMAN: I wonder before we recognize the Honourable ... Oh, fine. The Honourable M·3mber for Fort Rouge. MR. LLOYD AXWORTHY (Fort Rouge): Mr . Chairman, I'd like if I may to address some comments on the question of the position of Manitoba Hydro. I'd like first if I might, Mr. Chairman, first to express in part some concern about the tenor of some of the exchanges that has occurred on this question of the position of Hydro and the supply of energy that we've heard up to this point.

There has been some interesting, and I would perhaps have to say some what surprising and disturbing presentations concerning the need to develop some form of western energy policy, which in fact carries. with it a very strong tinge of a western separatist energy policy. I think that in this. particular position it's important that we clarify who in the House exactly is. in favour of such kinds of conditions .

Because I think that the one thing that we haven't really heard back fully yet from the Firs.t Minister on this issue is some clear definition of the respective costs and benefits that would be related if we were to follow the advice of some of the members of this House, and that is to share in the kind of bargaining position that has been taken by Sas.katchewan and Alberta in relation to energy prices., and whether in fact we are to go along with some form of elimination of the two-price energy policy that we now follow.

It strikes me that this would end up costing consumers in Manitoba about $100 million in additional energy costs, which I find surprising because the same people who are advocating that we associate ourselves with Alberta are the same people who seem to be saying, or expressing, taking up a good deal of the time of this House talking about the problems of inflation and the additional cost that would be passed on to consumers and yet they' re advocating a position that would probably cost every man, woman and child in this province an extra $100 a year in energy costs .

There's a certain, I guess all we can say to be kind when we talk about the position taken by the Member for Morris, the M.3mber for Lakeside, and others, and I realize that's not the

May 14, 1975 25G5 SUPPLY - CAPITAL SUPPLY (MR. AXWORTHY cont'd) ..... position taken by the Leader of the Opposition but we know that there are certain differences, and we have to accept that.

But they at least are m:.Jre in a majority than he is and I would wonder first how they would reconcile what is an obl'ious contradiction between their position where the:-· are concerned about the inflationary pressures in the provin ce, and at the sam.9 tim.e ad\·ocating a policy position to the government which would in fact cost every person in this province - I would eBtimate about $100 each - U" we were to adopt that kind of policy. I think that that is something, Mr.

Chairnnn, which I would hope that the First Minister might have been more explicit about in terms of delineating the M-tnitoba position carefully about why in fact we're not involved in that sort of association or that kind of alignment.

I would think that of course the First Minister has very different political reasons for not associating himself with such a policy, because I would realize that there would be a certain affinity between the policies promoted by the Premier of Alberta and those cndor;;ed by members of the Conservative Party in this House, and I think for political reasons which we don't have to go into. I would have hoped, Mr.

Chairman, that in this discussion of the energy policy that we would have been able to receive from the First Minister a clear enunciation of the kind of energy policy that we have in Manitoba that would relate directly to those kinds of consumer interests that we have to be ultimately concerned with. That we have talked a great deal, I suppose almost like .. . the First Minister has appeared like an old testament prophet sort of wandering the earth, telling us about the Armageddon that's to come if we don't sort of find a more virtuous and righteous way of living in energy consumption.

But it still hasn't exclusively, to my mind, stated how, in fact, the present energy policies other than some, oh, gesture towards expanding our use of renewable resources, in fact is going to affect industry and consumers in Manitoba over the next sa�· five years, to take a tim2 frame just for sake of argument. And, Mr.

Chairman, this comes back lo what I think is a very critical question because we can't talk about the allocation of energy development in this province in terms of our own allocation of capital unless we have some policy in mind, other than something, as I sa_v, a sort of a prophetical challenge to make better Lise of our renewable resources. Because one of the things that strikes me that is happening in this country is that we' re becoming rapidly capital short in the investment in energy resources.

That the first thing that any provincial govern ment must do in order for us to develop a proper and effecti\'e national policy is to begin looking at its own capital requiremr,mts which is what we're talking about here. And to look at those capital requirements in relatiun to some plan as to where we want to go, other than simply keeping up with demand, keeping our heads above water or making sure that we can turn the lights on, that doesn't seem to me really a policy or a plan. That's simply reaction t.o a crisis or a reaction to events.

And that one of the real reasons and lhe must effectiye wa:-• of offsetting the kind of separatists ur semi-separatist or pHeudo-separatist kind of language we have heard expressed here, and to develop a mu•;h more comprehensive national policy as when we put our o'An house in order, when we have a prett_\' clear example of the kinds of requirements that we have. And frankly, Mr. Chairman, I'm very m·.1ch concerned about the capital position of M:mitoba Hydro.

I think thal there a number of really serious issues lhat have to be raised about whether we are using the capital in the right places and whether we are getting effective use out of that capital.

And these are really the questions I want to raise with the Fi rsl Minister who is responsible for this area because I don't think that we can provide an effective cmmtervail or counterploys to the position that we have heard about, sort of this kind of western chauvinism that we've heard, unless we arc able to very accurately prescribe our own re4uire ments and make sure that what we're doing in Manitoba will ven· 4uicklv and easily and profitabl1· fit into a national energy policy.

And that I think should be the focu;; of lhe debate or discussion about the Capital Supply for ]\,hnitoba Hydro lhat we are now engaged in. And I'd like first, Mr. Chairman, if l might, to raise some questions which ha\·e lo deal with the application of capital in Manitoba Hydro. And the one thing that 11'E' are all aware of is that Manitoba Hydro over the years has become a gargantuan organization It has be corn e, I suppose, the closest thing in Manitoba to a m11lti-_1ational corporation.

It is just ecrtainlv one of the largest enterprises of an.1· kind, public or private, in Western Canari<L It is a verv big operation, And I suppose it carries with it, as do all big operations, Cl'rlain rlr<tll'back that

256 6 May 14, 1975 SUPPLY - CAPITAL SUPPLY (MR. AXWORTHY cont'd) ••... that kind of bigness and organizational complexity carries about. And one of the first primary laws of large corporations is they begin to have a certain disregard for efficiencies and costs and effectiveness, that they begin to once they start dealing in hundreds of millions of dollars and start talking in that kind of language, you begin forgetting about how you can save on the tens of thousands or the hundreds of thousands of doll ars. Well let me point out, Mr.

Chairman, that right now in the Province of Manitoba, for every single dollar of revenue, every single dollar of hydro rates that are raised from the users of hydro, 42 cents goes in to pay the interest on capital . And it was close to half of the money that Hydro acquires from its users, goes in to pay interest on capital. Forty -two cents out of every dollar . Now that simply represents, Mr. Chairman, a very very big commitm<":mt in terms of capital supply.

And it would seem to me that because of that tremendous kind of investment and portfolio that it is important that the application of that be examined pretty carefully. And let me point out one example, Mr. Chairman, that in the operation of Hydro, they undertake almost exclusively the installation of all major fixtures or facilities fo.�· hydro or electrical pow er. So that if a major industrial plant is setting up industrial machinery requiring electrical power, the estimating work is done by Hydro and eventually the construction and implementation work is done by Hy dro .

Now there are some very curious kinds of business practices followed because Hydro covers all that but to begin with, they will do estimating without any charge to the prospective client unless the client happens to use that facility. In other words, unlike most consulting firms or estimating firms, which will say that they'll do a detailed e::timate but even if the client isn't going to use that kind of plan, they' re still charged for that fee. Well, Hydro doesn't do that. The cost is absorbed by the ratepayer. He takes the cost under his account.

A second practice and perhaps something which is even more important, that when Hydro goes about to do this major kind of capital fixture and facility installa tion, they will give a fixed price to the potential client. They will say, it's going to cost this much.

But on the other side of the coin, the suppliers to Hydro, the people who supply the cable and the generators and the transformers and all the equipment, have a cost-plus arrangement, which really means that in many cases Hydro is forced, because it had a fixed price, its costs exceed what the fixed price brings in, and again the subsidy is paid by the ratepayers. Again in terms of its use of capital, it's going out around doing its business and saying, boy ... You know, if there was any kind of private elect rical engineering firm working on that basis, they'd be in business about a week.

Well, you just can't afford to do that kind of thing, and yet here we are sort of every single year facing an 18-25 percent increase in Hydro rates and we've got Hydro going out basically subsidizing big users. And I guess you could really as a paradox say, here is an NDP government which if you look at it, is basically subsidizing large business operations through this kind of somewhat free gift of estimating, and certainly giving it an almost sort of bargain-basement deal in terms of the kind of construction work that it is prepared to do . I suppose, Mr.

Chairman, people in Hydro say, well gee whiz, you know, for a million-or-two dollar job, that's small potatoes . I mean, we're talking about $300 million dams and we can't be concerned about things like that. But the point is, is that in this kind of operation, it's the $100, OOO there and the $50 , OOO there, and the $200, OOO there, that begin to add up to represent really major indifference towards the stewards hip or husbandry of those capital resources, which is a very important requirem•:mt I think of any large organization. And I think that that is one of the major concerns that we have had.

And that is the fact that H:>dro as a m·1jor public utility and supplier, if it is to follow the commands of our prophet to go out and m11ltiply yourselves and develop more dams and more utilitie s and nuclear energy plants; that if it goes forward with the same kind of relative indifference towards cost control and towards the contracting of that kind of facility; then we are simply :;oing to be putting an awful lot of capital in, which we're asking sort of the Hydro users, the people who are paying the rates, to subsidize, if the bill's going to go up and it's going to expand.

And we are simply providing then a consumer subsidy to Hydro so they can go about sort of basically doing a fairly faulty and oftentimes very loose business practices. Now, Mr. Chairman, that's what concerns me in the operation of Hydro, and I only pick it out, I suppose, because of my own political philosophy, I just have a great deal of concern of

May 14, 1975 2567 SUPPLY - CAPITAL SUPPLY (MR. AXWORTHY cont'd) .. . any large enterprise, public or private. I just feel that there's a certain kind of characteristic takes over when organizations get to be too large, and that is that they begin to forget some of the basic requirem.2nts of good, effective operation and certainly we have the example of government itself; that Hydro is a major Crown corporation, is also a prime example of that kind of relative indifference to its successes. So that would be one major question that I would like lo focus upon, Mr.

Chairman, and is really lhal sort of internal application of Hydro. The second question, I raise, again comes back t.o the fact that the Premier has talked about the requirement both of fulfilling our potential in the use of Hydro power and then eventually moving into the nucle:i: .r field and beginning to develop a series of nuclear fired plants to provide electrical power in the Province of Manitoba. And as T gathet', according to the report by Mr.

Batem3.n in the intervie v he gave in the Financial Post of about two weeks ago, that in fact the site has already been picked out close to Selkirk, Manitoba and that work is going ahead and it's no longer in our conjecture, it's now a matter of fact. And that we're simply now into the nuclear era, we're now making commitments in this nuclear field, so I think it's time we began raising some serious questions about the use of nuclear power. Because it itself l think while it's an important alternative soLirce of power doesn't come without its own headaches and its own problems.

And certainly there has been a good deal of disruption in the United States caused by the problems related to hydro or related to the development of nuclear energy because of all kinds of safety problems and hazard prob lems that they must cope with.

And I just finished reading (I would recommend lo the First Minister in fact) a fascina ting account in the New Yorker magazine of how the State of New Jersey is now trying to develop a major nuclear plant in the Atlantic Ocean, using it as a site, all designed, I gather, because they simply can't any longer put nuclear sites in the ground. l'm certainly not against the use of nuclear energy and I think that it is one of the resources we must use and use well, but that would be the question I would like to raise.

But let me point out, for example, this kind of argument to the First Minister, that nuclear energy can be used for different kinds of power sources. It can be used to create electrical power, it can be also used for a form of electrolysis; in other words, taking water and using nuclear energy to break it down into its components, primarily hydrogen, and hydro gen as we know is a full replacemen t for natural gas. So the question that comes tu my mind is that we are talking about nuclear energy in Manitoba as a replacement for electricity, or to complement and supplement elect rical flow.

If however we are facing, as I think we are in Manitoba, a series of headaches and problems in getting proper supplies of natural gas because of pipeline problems, because of Alberta problems, because of all kinds of problems, and natural gas fulfills now about 80 percent of the heating requirem.:.;nls in the City of Winnipeg, that it seems to me that we have one of two alternatives; either we convert to electricity, which is a very expensive conversion item, it's probabl.v one of the m:Jsl expensive capital conversion activities one can go into, or we find a replacement for natural gas.

And su the question raises to me, has Manitoba H>'dro or the Go1·ernmenl of Manitoba considered, for example, that when they go into nuclear energy, that rather than using it as a form of generation of electrical power, they will in fact be using it as a form of conversion into hydrogen to replace the natural gas or lo supplement our natural gas supplies. Both are equal forms of energy.

It just may be that if you start counting up the amount of capital that it's going lo take to build the nuclear plants, develop the electrical generating capacity and then convert many homes and businesses in Winnipeg in the use of electrical power for heating and industrial purposes, it may be a much more expedient use of the capital to use those same mtclear plants as a conversion into h:-.,drogen resources, using it, locating them up on the shores of the Hudso n's Bav clm;e to Churchill and then pipeline them down, which would also fit in, I gather, as part of a program or a package for the development of an Arctic pipeline coming down through the north.

That it just may be and again having talked to some energy engineers in the area, the.v just might sav that that kind of additional source of fluid energy sources such as hydrogen, added lo the natural gas pipr_1linc, might make that a feasible economic operation. And the question raised to me, I don't believe, at least we haven't heard the First Minister or the Energ'.' Council or anybody involved in presumablv the decision-nnking on energy for Manitoba talk about that as an alternative. Nor, Mr. Chairman, hm·c \l'C heard

2568 May 14, 1975 SUPPLY - CAPITAL SUPPLY (MR. AXWORTHY cont'd) ... anybody dealing with energy problem s talk about the use of solar energy as a form of capital investment. And yet again if you read the Financial Post, you find out that the Federal Government is prepared to invest mo ney in solar energy; Ce ntral Mortgage and Housing is doing some experiments down eas t; the United States Congre ss has invested a quart er of a billion dollars into the research and development on solar energy.

And again talking with engineers at our univer sity, I discovered that one of the important aspects is that Winnipeg has an awful lot more sunlig ht than Washington, D. C. In fact we have about three times the sunlight. And even though it may seem somew hat sort of out of the question that, you know, on a February day that we could use solar energy for heat, in fact it' s the solar ray, it ' s not the heat it generates which becomes transferred energy, it would seem to me again that that would be a major complement or supplement to our hydro supply or hydro electric supplies .

And yet that alternative isn't being considered. One of the plans that I've heard talked about in term s of the Manitoba context is that for ma ny smaller towns and cit ies in particular, that rather than trying to invest large amounts of excess capital, that we could be sort of developing almost small solar type sites in small towns and cit ies as a supplement to their present electrical facilities at far less cost. So that comes down, Mr.

Chairman, again to the question of a stewardship that is being exe rcis ed by the government in relation to the use of very expensive capital, a use est imat ed in the next decade in Canada, we are going to require close to $115 billion worth of capital for energy purposes. Well, I quote from the Financial Post of April 26, 1975, that's a lot of m:mey . We 've already got a lot of mo ney invested, and as I said we're already paying 42 cents on the dollar to pay for the interest on that development .

So it seemed very inc umbent upon the energy planners for the Province of Manitoba to be findi:i1g ways of getting more "bang for the bu ck" or more energy for the dollar or m::ire use out of the very expensive and very scarce capital that is available to us . And it seems to me, Mr. Chairman, that ma ny of the alternatives which are less capital costly, which could produce other forms of energy, haven't been explored, talked about or discus sed.

Now som ewhere there may be someone sitting on Taylor Avenue worrying abo ut iL or dealing with it; there may be someone on our Energy Council which we keep hearing the Minis ter of Industry and Comme rce talking about but never see anything about: but the fact of the ma tter is, it doesn't seem to be part of the energy plans of this province. It doesn't seem to be part of the full application of all the kinds of energy alternatives that we could explore. So, Mr. Chairman, I ask myself the question, why ?

I think it comes back to a point that we have ra:.sed in this House now I think about five or six tim•2S going back the last year, that simply it apper.rs to me that the way we go about ma king decisions on energy in this province is not adequate . That there is Manitoba Hydro which is the dominant energy planner for the Province of Manitoba. Now Manitoba Hydro, as we all know and recognize, has had a lung and distinguished history in this province.

But let's recognize what they are: they are electrical engineers, the�, are interest ed in electrical power, that's what they were set up to do, that's what they do best , that's what they know how to do and that's what they want to continue doing. And they become sort of captivated or domi nated by that partic ular objective. Now that'': a valuable objective, but it does mean that other kinds of alternatives tend to be excluded, other kinds of options captivated or dom inated by that partic ular objective.

Now that's a valuable objective bu t it does mean that other kinds of alternatives tend to be excluded: other kinds of options tend not to be recognized or considered or brought in and given the same right. So we say, well obviously there's got to be some alternative to Manitoba Hydro . We can 't rely upon them simply to do all our energy planning because if that's the case we're going to end up wit h simple electrical energy and tend to ignore or be indifferent to other alternatives which may be less costly, less expensive, and more useful. So we say we have an Energy Cou ncil .

That's supposed to be the decision-mak er for energy policy. Well when we find out who sits on the En ergy Council we find out it's the Vice-Chairman of Hydro. In other words, it simply has become in effect an appendage of Manitoba Hydro again. And that's the point that we keep coming back to, Mr . Chairman, is that we have asked time and again in this House for an energy board or commission or department, I don't care what m8chanism it is, but one which would be able to fully plan the energy alternativ es, fully look at questions of conservation and fully look at questions of demand, fully look at the

May 14, 1975 25G9 SUPPLY - CAPITAL SUPPLY (MR. AXWORTHY cont'd) .. ... questions of the different kinds of energy sources, and also lookat where the capital could best be used, and someone that would be in a position to arbitrate between the demands for investment in electrical energy or begin investing in other forms of energy sources. Mr. Chairman, we would strongly put forward that that does not take place, that Manitoba and the Manitoba Government is still one-dimensional in its oLttlook. When the First Minister talks about renewable resources he's basically talking about one kind of renewable resource.

He's not talking about sunlight for example. I haven't heard him raise that as an alternative and say we're going to put some money into looking about how that can be applied to Manitoba. I think the reason for it is simply that the advice and expertise and knowledge and kind of information that is given to the First Minister basically comes from the Hydro Corporation. We're simply saying that is a major source and it shouldn't be discounted, but it shouldn't be the only source.

What we really require in Manitoba is a more effective kind of energy planning operation that would give us the ability to consider alternatives and consider how the capital in those resources would be applied. Now that is the concern that we have, Mr. Chairman, considering the Capital Supply of Manitoba Hydro. What it raises in our minds is that perhaps we're not getting the best use out of that capital because we're putting our bets on one spot on the table, and we should be spreading them around a little bit more and hopefully getting a better use out of that m'Jne�'.

I think that it is incumbent because the gr.and old days of cheap hydro in Manitob a are over. The Chairman of Hydro says that we can now expect an increase of up to 20 percent almost every year. No if, buts or maybes. I quote, he says: "Manitobo Hydro Chairman Len Bateman recently announced a 20 percent increase and said that it will continue to happen on an annual event." Well if that's the case, Mr.

Chairman, it seems to me the time has come, the time has come seriously to look at the energy planning that's going on and to see whether we shouldn't now restructure the operation, and I don't intend by these remarks, Mr. Chairman, to suggest that the First Minister has not been doing his job because I think that certainly from his statement and his actions he has indicated that this is his priority concern.

But what we feel should be done now is that the bases upon which those decisions are being made and that priority arrived at, be broader based and be based on other considerations than those which are simply concentrating on the use of electrical power. INTRODUCTION OF GUESTS MR. CHAIRM AN: Before I recognize the First Minister I wonder if I could draw the attention of the honourable members to the gallery where we have 29 students of the Cranberry Portage School, Grade 5 standing, under the direction of Mr. Kostynyk. This school is located in the constituency of the Honourable Member for Flin Flon.

On behalf of the members of the Assembly I bid you welcome here this afternoon. SUPPLY - CAPITAL SUPPLY cont'd MR. CHAIRMAN: The Honourable First Minister. MR. SCHREYER: Mr. Speaker, I really believe that the remarks of the Honourable Member for Fort Rouge deserve som � response, and I will accordingly try to respond point by point. To begin with I quite agree with the Honourable Member for Fort Rouge that there is little point in speaking in terms of some future Armageddon in terms of world energy problems.

I think that there is very great need to try and maintain a balanced view with respect to future energy problems. All the more reason then why the Member for Fort Rouge in admonish ing me, or anyone else, to avoid speaking in terms of a future Armageddon should Lake some pains himself to avoid the other extreme, which is that of the ostrich.

The belief that all is for the best in the best of all possible worlds, that we really have no impending problems in energy supply and price and cost of securing adequate supplies for the future, that certainly is an admonition which I would put in front of his doorstep, because there is ec.iual clanger that there are, and I think history demonstrates that there have been far too many people for far too long who take with complete equanimity the pattern of the past quartLr of a century. That's about all I'd like to say to him in that respect.

Now, he goes on to m'.lke some critic al observations with respect to the capital structure of Manitoba Hydro and what obviously by tone he implied to be such a fantastically large ratio of

2570 May 14, 1975 SUPPLY - CAPITAL SUPPLY (MR. SCHREYE R cont'd) .... . interest coverage charges to total operating budg et . wo uld only ask the Honourable Member for Fort Rouge, where has he been? Because analysis of any major public utility, and any major energy utility in particular, will dem onstrate that there is indeed, by definition and by its very nature, a very seemingly high ratio of debt ser vice cost to total budget. That is an essential, well if not essential at least it is an obvious characteristic of any utility operating in this or any other continent.

Then in any case I would say to the Honourable Member for Fort Rouge that he must maintain a perspective when looking at Manitoba Hydro's operations by relating it to operations of utilities anywhere else in our country . When viewed in that perspec tive then I do not believe that Manitoba Hydro com pares badly at all .

If he thinks that the total size of Manitoba Hydro is too large, that it's debt service cost is too high a ratio, then I would invite him to do an analysis of utilities in Ontario Hydro, Quebec Hydro, British Columbia Hydro, and his great fears will be lar gely assuaged and he will achieve some semblance of perspective, some proportionate view of things.

Becau se in relation to those three utilities, which I've ju st mention ed, Mani toba Hydro is relatively speaking not a large corporation, certainly not overly large, and its operating systems and total bu dgetary size is not something about which to be intimida ted. Of course it is very easy for the Member from Fort Rouge, or anyone else, to mak e the criticism that there are unnecessary expenditures being incurred by the util ity and that as a result rates are higher than they otherwise need be, and that the consume r has to pay for it in the end. To that I can only say, what else is new?

Because it doesn't ma tter whether it is Manitoba Hydro, Quebec Hydro, Ontario Hydro or Consolidated Edison of New York or Florida Li ght and Power, the fact of the matter is that anyone can come along and say that they are incurring unnecessary expenses, expenditures, that they are operating at less than optimum efficiency, and that therefore the consumer is being victi mized. I happen to believe that Mani toba Hydro's operations, in relation to counterpart utilities anywhere else in this continent, compare very favourably indeed . As a matt er of fact, what standard of measure is the honourable member using?

Does he feel that rates for Hydro Electric energy or electrical energy in Manitoba are too high? Well, perhaps they are too high in comparison with yesteryear, but in comparison with rates as they exist at this point in time anywhere else in Canada or North America, compare very favourably indeed .

As a matt er of fact, as of May, 1975, as of this point in time, in looking at electricity rates in cities over 100, OOO population across Ca nada, the rates in Winnipeg are next only to those of Regina and Saskatoon in terms of favourability or lowness of rates, and are indeed lower than cit ies such as Toronto, Montreal, Vancouver, Victoria, you name it .

Again, just for purposes of trying to bring some sembla nce of perspective to bear, the entire rate being charged consumers or users by Manitoba Hydro is less than the amount of the increment or the increase alone that went into effect in the past 12 mo nths with utilities such as Consolidated Edi son, Florida Li ght and Power, Southern Florida Li ght and Power, etc. So while there are problems, Mr. Chairman, the problems mu st be viewed in perspec tive . They must not be viewed in some kind of sim plistic and unreal isolation of the world around us . Well the memb er goes on to speak of nuclear energy .

I hesitate to say much as a layman because frankly it is a rather confusing and disturbing picture. On the one hand there are those who still persist in raising the spectre of great technological problems, the spectre of radio-active poisoning over the years and decades, while at the same time in places of the world not favourably endowed wit h renewable energy resou rces, they are proceeding to build nuclear generating capacity with great mo mentum .

Are we to conclude that all of these ju risdictions and the best of their scientific brains are somehow mad and that they are allowing the construction of energy capacity of a kind that is so potentially dangerous and poisonous? , rather suspect that here too, there is need to bring some semblance of perspective and balance to bear . I am not advocating that we rush blindly ahead withl he c-onstruction of nuclear ca pacity.

But given, and I think it is a fact in our day and age, that because of the need for environmental analysis and environmental impact analysis that in order to do the proper job of an environmental analysis rather than lip service, you cannot give notice a year ahead, but something closer ahead 1f the date by which you actually intend or hope to have something on stream in operation.

May 14, 1975 2571 SUPPLY - CAPITAL SUPPLY (MR. SCHREYER cont'd) . . . . So all we have really in effect done is to serve notice that some time by the middle to late 1980s, as matters now seem, that it would seem to be necessary to have nuclear capacity, you might say the first generation of nuclear capacity actually operating, and in order to meet that kind of time target it is necessary to give notice today, this year, with respect to future intentions, so that all the critics can have their say and the environmental analysis can be carried out, etc.

But, you know, I cannot resist expressing the very personal view that I frankly do not understand those people, who seem to pose as the great protectors of the environment, it would seem happen in many cases to be the ones that are most unconcerned about the phenomenon which has been at work now for many years relative to the relentless drawing down of the reservoir of the world's non-renewable energy resources. However, if they can reconcile that in their own mind I'd be most genuinely curious to know what their thought process and reasoning is.

The Honourable Member goes on to mention solar energy, and in that regard I really will discipline myself to resist making any observations because I ha"e not seen anything yet to indicate that this is something that should be treated seriously. It is something that is being carried out as a matter of more pure than applied research, and of course there's nothing w.rong with that.

But if the honourable member is suggesting that Manitoba who is a province of one million souls, should be appropriating significant amount of f'Jnds to carry out pure or only semi-pr actical research into solar energy, then I say to him that that is the most unwise kind of counsel that he is giving. As a matter of fact research into some of the more difficult and unlikely sources of energy is best carried out at the national level, and indeed I would go a step further and say that even a national effort might be too localized and fragmented a way in which to handle that kind of research.

It is one which perhaps deserves a much closer knit international co-operation and international effort. But for a province of one million people, it is almost absurd to suggest that we should be mounting a major large scale and costly research into solar energy. What about the other nine prov inces and wouldn't this best he co-o rdinated through the National Research Council?

And because the National Research Council may not be getting the funding from the Federal Government is no reason for a partisan attack on a provincial government that they should be carrying the burden of the nation on its shoulders with respect to some semi-far out type of research.

Wherever some modest research can be carried out that happens to coincide with something that is logical in the circumstances to any one province, there we would not hestitate to carry out some modest research, and indeed I believe it is a fact that right here above this very building that we're sitting in, we have a small, mundane, modest project of research i;; oing on with respect to solar energy. Now, I don't know if that pleases the honourable member for Fort Rouge, but if that's his preoccupation, then only some 100 feet up we have a solar energy research project going on.

But I wouldn't advise him to hold his breath as to the practical applicability of the results of that research. Beyond that, Mr. Speaker, does the honourable m.om be r not know that one of the most effective applications of solar energy is the energy that is created through the sun lifting moisture from the earth and the oceans into the atm :>sphere and letting it back down again as precipitation, which finds its way throu gh the turbines on the Nelson River?

That is the ultimate form of solar energy, and my honourable friend need not get too excited about using mirrors and glass and coloured glass in terms of these other solar energy projects. But I do not feel at all competent, and I would suggest neither does my honourable friend, to speculate as to the relative merits of solar energ�· as compared to other, perhaps m·ire esoteric, you might put it that way, possibilities of harnesGing renewable energy.

There is, my honourable friend, if he's interested in these matters, there is a very good question to be raised, I believe, in Canada, not only in Manitoba - wh_v just in Manitoba - but a very good question to be raised with respect to a country of our size, endowed with vast quantities of timber, much of it scrub timber not lending itself to pulp or lumbt:r very well, diseased timber, scrub timber, waste by-products of timl:.er, I really would invite my honourable friend to check with his connections in Ottawa - and I believe he has some, quite a few I should think - as to why Canada is not miJunting by itself or in co- operation with province8 like Ontario and Manitoba.

I think we would be quite willing to co-ope rate in a research and even pilot pro ject, pilot plant in methanol production from wood8tUff8 a8 oppo8ed to foodstuffH. But, you know,

2572 May 14, 1975 SUPPLY - CAPITAL SUPPLY (MR. SCHREYER cont'd) ..•.. we can speculate endlessly as to the possibilities. What I regret and I would think my honourable friend regrets too is that thus far there has not been any significant preoccupation on the part of certain obvious federal agencies with respect to doing more systematic R and D into some of the very possibilities he's talking about. MR. CHAIRMAN: The Honourable Member for Radisson. MR. HARRY SHAFRA NSKY (R adisson): I rise, Mr.

Chairman, I just rise to express a concern on behalf of a number of citizens of Manitoba, and this should not be construed that I'm speaking in opposition to the Capital Su pply for the Hydro. But I rise to express a few concerns about the last few rivers where we have the most finest fishing in the North American Continent and that is the speckled trout. These are one of the few streams that are tributaries of the Nelson River that will be affected after the limestone site is completed.

I would like to see, and direct to the Mlnis ter responsible for Manitoba Hydro that he would express some interest in doing some study on possible ways and means where the fish population, the speckled trout, could be saved in the tributaries: the Upper Limestone River, there is the Weir River which is going to be affected after Gillam Island. But these, the speckled trout in these rivers are rather unique on the North American continent because these are the only streams where the speckled trout goes into the Hudson Bay. It is like the Atlantic salmon. A MEMBER: Have you been there?

MR" SHAFRANSKY: Yes, I have been there. There are a few streams on the North American continent where the trout, the speckled trout, unlike the God's River where they stay the year round, the speckled trout from the Limestone, the Weir River and I believe there's the Roblin River, they go out into the Hudson Bay and they come back in the fall for spawning and then return to the sea. They're similar I suppose to the Atlantic salmon, but the fact is that they are the most beautiful fish, if anybody has had the pleasure of catching speckled trout . . . A MEMBER: And you have? MR. SHAFRANSKY: Yes, I have.

I caught it on the God's River. A MEMBER: How far and how deep? MR. SHAFRANSKY: But I would like to express this concern on behalf of the number of people, there's one or two people in particular, very good friends of mine, Don McMaster who has been involved with the Wildlife Federation and with the Naturalist and with the Fly Fishermen's Association of Manitoba; and Lawrence Heska - in fact they did a film last fall on their fishing expeditio n to the Limestone River.

I think m•3mbers should see this film to see the beautiful stream and to look at the possible ways where the fish could be saved by being able to continue going upstream, whether it be on the - some fish ladder or the system that has been used in British Columbia I believe, on the Nelson River, where they have sort of container tanks where the fish come up and then they're just lifted over the power sites so they're allowed to continue moving upstream to the spawning areas. I'd like to see the Minister look into this question and possibly ask for some research to be done in this regard.

I know that the cost, when you compare the total overall cost of construction, is really going to be very minimal. I understand that there has been a study made on the - is it the Dauphin River at Fairford - for establishing some system where the pickerel can go upstream and they found they estimated the cost of around 60, OOO to 100, OOO, so if you muJtiply that by 2 - 3, I think it would be a worthwhile project to save some of the streams that have for m.:i.ny centuries been the fishing areas for the people living in the North and then there are many fishermen now who are discovering it.

It is a strange fact that very few people were aware of this speckled trout until there were ardent fishermen like the people I mentioned, have gone out there on expeditions. They get off the train at the Limestone Bridge and then go upstream to the areas where they can do some excellent fishing. I would mention that the - in the film that I saw yesterday, they took one fish a day and one fish - there were three of them - was enough for a meal for all of them. They only brought back one.

They were all about four pounds, which is a good size, a minimum of about four pounds. --(Interjection)-- Well, they just took flour and they made bannock. Mr. Chairmm, I would like to direct this concern on behalf of these people who would like to see some action, at least some study made whether it's going to be feasible or not, and I think they would be quite content with that. Thank you. MR" CHAIRMAN: The Honourable Member for Riel.

May 14, 1975 2573 SUPPLY - CAPITAL SUPPLY MR. CRAIK: Mr. Chairman, I'd like to join in this hard-hitting academic debate that's going forth here and take

part in it and straighten everybody out on this matter. I couldn't help but listen with great interest to the Member for Fort Rouge in his comments, because I've had some interest in the energy debate. But I must admit it ' s one that fascinates a great many people, and the people thal are involved in eyeing and watching, particularly these days, the development of energy types and progress in different areas, are legion in number now compared to what they were several years ago. Mr.

Chairman, if I can take a few minutes of the Chamber's time tu bore them �ith some personal background in this, away back in about 1958 when I undertook to do some post-graduate work in engineering I was very interested in Lhe energy field. Having trotted off to the Univer sity of Minnesota where there was a fair amount of work going on in this area, I immediately was sort of captivated by the sort of thing that seems to be captivating the Member for Fort Rouge now. I remember then particularly reading one

article in Solar Energy magazine that said, "If you took all the known sources of coal, oil, gas, uranium, converted them all into the amount of energy and know reserves in the whole world and put them all into one big pile, turned them into all the available energy you could get out of it, that it would amou nt to two days of the amount of solar energy that falls on the surface of the earth ." I said, boy that's for me and I did a master's thesis on solar energy.

It took me about two years to do it and I built solar collectors, and I built the first solar collector in Western Canada, and it's probably still parked out on the roof at the university and it's been rusting there for the last 10 or 12 years; produced the first technical paper, I think, in Western Canada on the availability of solar energy and proved to the world that it was viable in Western Canada. And that's just about the spot that the Member for Fort Rouge is at.

It's interesting to see that once in a while in this Chamber the politics becomes more than just the art of the possible and we can speculate on some of these heretofore areas that arc going Lo be of great interest to us. Now, in that particular field though before leaving it, I can say with probably a degree of some experience in it - probably a degree more experience than I have in many other areas I comment on in this House - that solar energy will have a place here at some point. I would like to say that it is always an ace in the hole for mankind.

When they quit fighting about all the other energy sou rces at some point in time they'll probably resort to utilization of solar energy because it's a matter of economics and that's about Lhe size of it. Now I think we should be doing work in this area, too, but I have to admit that when we really get down to the practicalities of it that the technology we'll use on utilization of solar energy in this part of the world will come from places other than Manitoba, and other than probably the prairies. Probably other than Canada.

Strictly speaking, I think that always it's a good idea to keep up with the state of the art and keep active in it. You have to keep credible people working in the area. But you have to look at it from hard, cold necessity. The necessity for development of solar energy in the United States is much much greater than it is in Canada. We do have an abundant supply of solar energy mainly on the prairies because we have the clear skies.

But we have the perennial problem of how do you store the energy from the time of the year when you don't need it to the time of year when you do need it9 And that always boils down to be the basic problem. So if some members want to address themselves to the storage from the bad times of the year to the other times of the ye'ir and vice versa, then they'll be doing Manitobans a favour.

As a matter of fact, when the Member for Fort Rouge brought in his resolution regard ing a city - fifly miles located out of Winnipeg - when the resolution was presented to this Ho use to discuss the feasibility of a new cit:v located somewhere fift.v miles or thereabouts from the present Cit�· of Winnipeg, I couldn't help but again sit back and speculate, ,vou know, as one can do with this t�1pe of resolution.

I could see moving into just west to Lhe Town of Miami on the escarpment on the west side of the Great Agassiz Lake and boring into the side of that great escarpment and hauling out a massive cavern inside there, miles in breadth and y::i.rds in height - and that's not in the metric measure, Mr. Chairman - but nevertheless a massive cavern in there and with massive solar collectors above and collection of body heat inside, and no vehicles spewing out all these undesirable things and J thought, well, whv jus t built a city?

Let's go out and build a cave in the bank of the great escarpment and we'll suddenly put to use all the natural resources we have in Manitoba. We've solved the space problem: we're not using all this farm space up that the Member for Morris v.-orries about.

25 74 May 14, 1975 SUPPLY - CAPITAL SUPPLY (MRo CRAIK cont'd) • . . • . We're not using up all this energy that everybody else is worried about. We can build solar collectors on the top of it. We can heat it. We can solve all the urban congestion problems by doing away with automobiles. I mean, why think small? We might as well go the whole way.

So having given this impetus now to the Members of the Legislature, I'm sure that next year we'll see in Capital Supply a provision to build a city of this nature, buried in the banks of the escarpment and with all these other very desirable features that have been mentione d. -- (Interjection)-- ! couldn't also help but think, when the Member for Fort Rouge was talking, getting down to more of the practicalities of the matter, that the leader of the debate of his party in opposition to the Churchill diversion, to some extent took their impetus from the professional people in water resources at the university.

There was one man in particular there who I always regarded very highly who was a very capable engineer by the name of Professor Cooper, who is now, I think, adviser to the World Bank on Utilization. Prior to his strenuous opposition to the diversion of the Churchill River, preceding it by perhaps eight years or ten years, he had devised a scheme to export water to the United States from Canada. He was right to the extent that why should people get excited about the export of water when it's a renewable resource, when they are willingly exporting all their gas and oil without any reservations what soev er.

Now that scene is changed, everybody's concerned about that now. He was ahead of his time. It was a very accurate assessment, a rationalization from his point of view. But the point was that he was going to dam up all the eastward flowing systems of water, the Churchill and Saskatchewan and Nelson, and pump and dig big trenches and run it down from Northern Manitoba with a big trench down to the American border.

He was going to put on a massive metering system and he was going to have the sale of all this water to the United States, and this was going to be the mecca for the economic problems of Manitoba, particularly, beca use we were going to have the channel on our side of the border between here and Saskatchew an . We were going to have a big meter, and this water was going to get used, not wasted on simple power production, but get used for irrigation and all these other things.

But when Professor Cooper - and I have told him this, I'm not relaying anything that's out of school, I used to argue with him on this matter in a joking manner - when he got terribly exercised about the environmental impact on the Churchill River, mainly because he became somewhat of a naturalist along the way, I used to remind him of this scheme that he was proposing for the export, where he was not only going to dam tho se rivers, he was going to channel right thro ugh Manitoba, north to south and cut through all sorts of territory that had been heretofore unexplored and occupied only by Mother Nature, cut through farmlands and everything else and build massive structures to get this water down to the United States .

And I said what' s happened in the last six or eight years ? Did you do an environmental impact study on your proposal for exporting water to the United States? And somehow the question never really got answered. I think in all fairness that at that stage of the game he rationalized the justification for it, but nevertheless, environmental impact at that stage of the game was not a priority in the scheme of things.

But it became a priority later on when he became conscious of the environmental damage of what, in relation to that, was a very simple, very simple natural resource project, namely, the damming of Sou th Indian Lake and the Churchill River . But the Liberal Party got all choked up on this.

And I have to say that I really believe that they at some point in time, if the Member for Fort Rouge carries on with his present preoccupation about other en,ergy sources, he will come around to the realization that in Manitoba in particular to not utilize the renewable natural reso urce of water in Northern Mani toba, is to the way of the thinking of our group and now the government's - and it wasn't when the government first came to power - would be a mistake to not utilize that to its maximum.

I think that given his present line of thought in carrying along these lines he 'l l arrive at the con clusion that, to have Stopped, Looked and Listened on Ch urchill River would not have been in the best interests of Manitoba and utilizing that energy source, that renewable source - the natural cycle put to poetry by the First Minister here several minutes ago, the flow of water to the ocean and so on - is in fact a very sensible use. Nobody denies the environmental impact. Nobody denies that it takes place. You balance off that against the argument of the utilization of a renewable natural resource.

After you've fought it all thro ugh, particularly when you get into the problems of energy sources now, I don't think there 's any doubt about the fact that you come down on the side of harnessing the sources of renewable power that we have in the

May 14, 197 5 2575 SUPPLY - CAPITAL SUPPLY (MR. CRAIK co nt'd ) .•... Province of Manitoba. And that, Mr. Chairm an, has always been the posi tion of our party on this matter. The only item on which we have hit the govern ment, and hit them as hard as we could, is the delays in malting the decis ions that have been made, and then the sequence of the deci sio ns and the implementation of the programs that Mani toba Hydro has done. We thin k it has been unne cessa rily expensive, we think that the cost, the excess cost, has run in the hundreds of millions because of the pattern follow ed .

I thin k there has been some lost energy in the changes that have been made too, but by and large it is secondary to the exce ssive costs that have been involved in the delay in decisions. So it's wi th a degree of satisf action that we see now the Firs t Min ist er becoming what he wasn ' t in the first year or two of his occupying the chair, and that is the st rong advocate of maximizing the use of renewable natural resources, and that has always been our posit ion. We support it. Again I say wholeheartedly. We thin k it 'll st and the test of time.

Our main crilicism is si mply that the capital costs that we're dealing with here now are too high. So, Mr. Chairman, with those few scattered remark s, I want to say here in conclusi on, there 's no doubt that the capital requirements being as ked for here for Mani toba Hydro are st aggering in relation to the other capital requirements of the province.

But I think you have to come down on the side, that even though we feel that they're higher than they should have been over the period of the last two years, that to vote agai nst them would be irr esp ons ible, jast because we thin k they're on the high si de, because in total they're a good inves tment in Manitoba' s futu re and therefore we support them. . . • . . continued next page

25 76 May 14, 1975 CAPITAL SUPPL Y MR. CHAIRMAN : The Honourable Member for Fort Rouge. MR. AXWORTHY: Mr . Chairman, before the First Minister re sponds to the problem of the speckled trout, and indicates whether he 's about prepared to build an underground city, there are some comments I'd like to make. One was rea lly sparked - fir st I was going to react to what I thought was a slightly gratuitous passage in the Minister 's remarks concerning those who. you know, in a fairly honest and genuine way have expre ssed concern about their environ ment.

I think the First Minister tended to provide some scorn to their motives and their out look, and I think that the Member from Riel came back with the same points , suggesting that he knew a scientist who h::td sort of changed his mind along the way. It brings to mind. Mr.

Chairman, I think one of the more interesting books I read severa l ye ars back written by Robert Op;:ienheimer, who was the father of the atomic bomb, and who said that during a period of hi s scientific life as a scientist and engin eer working on nuclear energy, he had been trained, conditioned to become mesmorized by the technological achievements, how one could use science for the betterment of ma n, but over time became captive to the game itself. forgetting what the end of the game should be.

It was only after that bomb exploded and hundreds of thou sands of people were killed. that he and a number of other scienti sts bega n realiz ing that as scienti sts, with the kind of knowledge and wisdom and skill that they had acquired. they bore a much heavier re sponsibility to society to begin asking them selves about the consequences of their acts. I think that that is in ma ny cases the issue that this party two Dr three years ago tried to raise.

I d::m't think there is, at least to my knowledge, and I wasn 't in the House at that time so I can 't reca ll exactly, but I don't think the form er leader of this party, and I certainly as a candidate in the last electio n never at any time said, don't build the thing, d::m't build the con version, but are simp ly saying, "How are you going to do it and what's the conseque nce s" ?

No :ine in this party has ever been against the maximum use of natural resourc es, as long as the benefits outweigh the dama ge s, and as long as we would have some proper concern being expr esse d by those who are doing the planning and the construction, that in fact they were doing so with all the interests of thi s commu nity involved taken into account. When the slogan came about, sort of "Stop, look and listen", the stop part was on the basis that it was time to take a good and cautious look at the kind of actions and investments that we were ma king in this pro vince for the use of energy.

I would like to suggest to the Member for Riel. and to the First Minister. th at the wis dom of that particular point in part has been borne out because right now up at the. sort of in that Churchill Diversion Project the government is facing a possible laws,.iit; it's facing the kind of anguish of Indian reserves up in that area; it could possibly have the constru ction held up.

I d·Jn 't know what 's going to happen. if there 's going to be an injunction laid d JWn in the courts in the next while or not, but the fact of the ma tter is if there had been a little bit more time spent looking at what that project was going to do, and preparing with some foresight to its consequences and overcoming them, then we woul dn't be in the kind of continual legal mess and hassles that we get ourselves into now.

One of the problems that Hydro itsel f has to face is its commitment of capital to large proj ects, which may be tied up in a legal battle that could last two or three years, we d·Jn 't know; as well as denying in ma ny cases sart of some funda me ntal legal rights to the reserve people on the reserves up in that area. Now that was the kind of question we were raising then. We dldn't say, "Don 't build it. " We said, "Of course we have to use our water p::iwer and we have to make maximum use of it, it 's one of our natural resources.

" What we were saying is that scientists and engin eers and planners can become sort of the modicum sart of execution of the technical goal and forget that that technical achievement carried with it ma ny kinds of social and economic and legal and human kinds of consequences that we must take an account of to our own sorrow. I think we sh::i:.ild, rather than trying to pat ourselves on the back in this province, say, "Boy, didn't we do a great job on the Churchil l, " we should be treating it with some sorrow and lea rning from the mist akes.

I agree with the use of the Churchill for its power, but I certa inly have ma ny questions about the way it was done, and the kinds of dama ge it's going to d::i to the, not just to the environment of the people along that way, and whether in fact the costs are going to jus tify and warrant it along the way. When we were talking in those periods, we were saying, "Stop for a year, take a good look at the problem. Let 's find out. Let 's hold the hearings. Let 's find out what people are concerned about, " and then incorporate those kinds of concerns into

May 14, 1975 2577 CAPITAL SUPPLY (MR. AXWORTH Y co nt'd ) .. .. . your plann ing. And fnmkly, Mr. Chai rm an, we are paying a ve ry heavy pri ce for not d)ing that. I think that is the same quest ion I am trying to raise with the Fir st Min ister at this p:iint. I'm not talking about esoteric thing s, I' m talking about real practical problem s, beca use one thing you learn about, or try to learn about in this energy field, is there's a very long time line.

That when you start talking about investi ng in nuclear energy, or more hydro p:iwer, or other alter nativ es, you're talking about inv estments that will have a life span of 50, 75 or 100 yea rs, and it will probably take 5, 10 , 15, 20 yea rs for exec ution. I'm sim ply saying the time has now com e when we should be lo oking at those other alterna tives, not as s ome s'i rt of esoteric research design, but looking at them as alternati ves. I think the Minister simpl y didn 't answer the ques tion I was raising about what kind of planning is going on.

And if he 's right saying - he says to me, "Why d:m 't you use your connec tions in Otta wa" ? You know, he is the Premier of this prov ince . The Provincial Gov ernment is, you know, is invited down to attend conference after conference . They discuss thing s with the Prime Minister and the Minister of Energy, why aren 't they raising it with them ? MR. SCHREYER: We have. MR. AXWORTH Y: Well, where is it? Where is the example, that in terms of the plants - I read the Minist er 's statement at the Energy Confere nce; I didn 't see these things being raised.

I'm not denying they were very noble words, b.it your noble words, plus 25 cents, gets you a ride on the bus these days. What we ' re really look ing forward to is rea lly the ki nd of rec om me ndation in terms of a national energy policy for this country that would include the kin ds of im peratives that exist in Manitoba. I was interested to hear the Member for Riel talk about his own work in the area of solar ener gy : I d:in't pretend to be an expert in it. But I do know that it is not an esoteric exercise, it 's now going on in practical resea rch and design applica tion in parts of this coun try .

There is the Brac e Research Institute at McGill Univ ersit y which is conductin g it in the Provi nce of Quebec. The Central Mortgage an d Ho :ising is now b.iild ing houses using it and testin g out its alternativ es. MR. SCHREYER: Don't hold your breath. MR. AXWORTH Y: Well, you see, this is the point, is that the proble ms wit h prophets is they become nar row mi nded very quic kly; they bec ome fixed on their own prophesy and they become self -fulfilli ng.

The problem with na rrow-m inded p: mple is that all of a sudden ev er y one else becomes, you know, ever ything else is esoteric and not to be considered because they know what 's best. Well, that 's the problem with having someone becoming elevated to the status of an Old Testament prophet, he ceases to becom e a Premier, and is now sort of more inter ested in giving us sort of reli gi ous ca nons and kinds of scriptual lessons about the virtues of me n, an d less intl'r ested in the practical problems of developing a very effectiv e en ergy p:ilicy for this province.

That's the kind of question we 'r e raising with Lhern, is simply saying is --(I nterjec tion) --Well, I think, you know - I suppose he has a kind of a Char lton He ston look or s'."lrnething, or I guess it's a Cecil B. Dc Mille Old Testament prophet I would suggest would be his requiremen t.

And act ually, you know, and that 's the old 195 0' s rnovies, and that ' s the prob lem we 're still g9ing, you know, Wl, 're still using sort of 1950 scripts to write our en ergy policy , and we'r e sti ll corni ng down with sort of tablets from the stone, and sort of s'."lmehow assuming that it's going to sort of, that the truth will be revealed. Well, I' m su�gesting that I'm not sort of hung up on S'."llar energy, I use it as an example, as an alternati ve. I'm also sure ll'l' h:ive ti mber uses. We also have a lot of co al resources in wes tern Canada that we should be looking at.

I usPd the example of conve rsion into hydrogen as an altern ative for na tural gas ticcl in with forms of Arctic pipelines . All these arp technolo g ically feasible. I think the Member for Riel pl intcd to the right question, and that is, it com es down to questions of costs.

The imp ortant thing that has happened in the last couple of yea rs in the en ergy problem in Ccmada is that we are now get ting a more realistic appraisal of cost, and so that ma ny of the other things which used to be esoteric now become practi cal because the c. :.ist threshold is now raised for the hydroca rbon fields much higher than it was before, and there fore ma ny of these other things which were not p9ssible before becom e within the range of possibili ty beca use their co sts now are compara ble to those of hydroc arbon fields ancl the price is being ... And that is the ma jor q'1cstion .

257 8 May 14, 1975 CAPITA L SUPPL Y (MR. AXWORTHY cont'

d) But the other issue that we raised in terms of the position of Manitoba is that we realize that we 'r e not Alberta and we can't live off those fat reserves that they 've got, and that' s why I totally discount the position I'v e heard from the Conserv atives coming along, that I think it 's a silly position to start talking about associating ourselves with Alber ta.

What we should be saying as part of an energy policy whether Manitoba needs, where there are alternativ es, and if it requires major investment from the Federa l Government, which I believe it does, because I want to see those things being laid out to them, in public, in open, and saying, "Her e's what we want; he re's what we should be doing; here's our contribution to a national energy policy. " That is the kind of exercise that we should be getting into.

And that is really the kind of question we raise because we d::m 't think that at the present mome nt we 're getting that kind of planning coming forward in Manitoba, sim ply because the planning is primarily d·)minated by an electrical energy utility , which has as we say, a good track record in that field, but it is one field. All I'm trying to suggest to the Minister when I talk about the position of Hydro is that any large organiza tion they develop fairly narrow-ga uged organizational goals, and then they tend to sort of get allies to support those goals.

I'm simpl y saying that that should not be sort of the fixed idea that we move on in this province, that we should be looking at those other alterna tiv es and how they fit in, and if it requires federal investment and co-operation, then le t's start saying so, and let's put the knuckles to the Federal Governme nt. I' m in favour of that. But I am saying that I think it should be som ething that is decided on in this province in terms of that kind of an asses sment and need.

I don't think prese ntly having some kind of sort of Mickey Mouse energy council that meets inside sort of closed chamber doors is a way of achieving it. I think we have to get the right kind of ma chinery to ma ke the right kind of policies, and the present process we follow leaves an awful lot to be desired. And that 's the me ssage we're getting.

You know, I d·)n 't think anyone here is pretending that we can ... the Member from Riel perhaps comes closest to be ing able to p':'ovide techni cal appraisal of different alternat ives, but we 'r e saying that there's enough evidence coming forward, that those alterna tiv es can be applied and could be of benefit to this province, and in fact could provide an effective counter point to the advantages now garnered in Alberta. As we pointed out in an earlier debate , Mr.

Chairman, we were concerned about the industrial development of this province, because with the heavy investment of petroleum money going into Alberta, they 're obviousl y engaging in a very heavy indust rial b:.iild-up in that province, and much of the locus of commercial and ma nagerial and industrial activity is that if there's not some counterpoint est ablished , will leave this province and not come here, and therefore we have to develop those alterna tive sources. I think electrical ene rgy is one of them.

But ma ybe we should be saying okay, ma ybe we have to concentrate the use of electrical energy to comp ete for industrial energy, but therefore we have to find some alterna tive for heating hom es. And that's what we say, okay, what's the alternative, using our nucl ear plants as a way of converting into hydrogen. Now I say, I'm not pret ending that I know whet her that can be, you know, the exact cost of them, but I think that is the kind of thinking that sho uld be going on, and if we can' t do it in our own resources, then we should be legit im ately saying to Ottawa, to Mr. Macd onald and to Mr.

Trudeau, then you say, you've got to do that for us, give us the resources or you do it, but let 1 s find out, otherwi se you 're going to be dealing with a depleted region in a short period of tim e. And that's the kind of case that we're trying to ma ke on a national policy. As I say, I realize the Premier has larger horizons than I do. I'm simpl y talking as a represe ntative in this province concerned about its ene rgy policy and its position. I know that he has wider horizons and goals and dimensions, but that's the thing that we're trying to put our minds to work on in terms of it.

That is why we're anxious and worried and concerned that the process we're now following is too domi nating in terms of its technical expert ise that 's being applied to the public utility requirements, the electrical utility requirem ents, and doesn 't engage the other resources, nor does it engage properl y in looking at questions of conservation, of how you can cut back dema nd s in ce rtain areas, whethe r it's in building codes, or whatever kinds of alterna tives, uses of transport ation and the rest of it, and combine it in so that we can also reduce much of our energy dema nd in, say, northern industrial areas so that we can con serve and compete industr ially with Alberta in western Can ada and make sure we get our fair share.

May 14, 1975 25 79 CAPIT AL SUPPLY (MR. AXWOR THY cont'

d) Now those are the kinds of options that should be bala nced. And also, Mr. Chairman, think they should be being discusse d in an open public way. Pe rhaps this is, you know, in part thi s debate on the capital supply for Hydro. It' s the first time we've heard it, it's the first ti me I knew that the Member from Rie l was an expert in solar energy and had writte n his the sis on it. And that' s good to know, that we've got someone a round in the province. I think we should put him to work right now and get him busy doing it.

But the fact of the matter is that one reason that's not happening is that energy has be en kind of a, you know , sort of a talk about - it's bee n treated as an esoteric thing , and it' s been talked about in these kind of highly generalized rhetorical terms and we haven' t got down to hard bu siness in a publ ic way.

Be cause I would suggest that there are probably many other people like the Member from Riel who also have knowledge and expertise and outlooks, and things that can be applied if that decisi on maki ng could be a muc h mor e open and engros sing one involving much more of the energy and outlook of a wid er range of pe ople in this provinc e, rather than having a group of civ il servants sort of sitting, appointed to an energy council, chair ed by a vic e-chai rm an of Manitoba Hydro. That's just too narrow a range and too lim ite d a form, or machinery, for the kind of major com mitme nt we should be making.

So I start off agr eeing with the First Minister 's prioritie s. I think they're dead right, but I do think that there should be some very major chang e and reorganization in the way that . we beg in applying our selve s to how we treat that priorit y. MR . CHAIRMAN: The Honourable Fir st Minister. MR. SC HREYE R: Mr" Speaker, I lis tened care fully and I am reall y tryin g to understand what the main or substantive points of disagree ment or difference of vi ew are .

The Honourable Me mber from Fort Rouge will forgive me if I'm a littl e confuse d, be cause I sense that he is re ally wanting to have his cake and eat it too. He is talking about the nec essity of keeping all our options open - and of cour se that' s fine, one should al ways keep options open as long as possibl e, but in the final analysis you have to lay hard plans and arrange for concrete specific design in enginee ring and get on with the construction, construction of whatever it is that re lates to thi s particular case, energy supply for the future.

I am not scornful of environme ntalists nor am I scornful of whatever re search activity is bein g undertaken anywher e in the wor ld with re spect to what - well for Ja ck of a better description , one at this point in ti me has to describe as relatively esoteric form s of potential energy. Bu t goodness knows if in the years ahead there se ems to be gr eater tangibil ity attach ing to one or other of these still relativ ely esoteric form s of potential energy, then of cour se, fine, mank ind can br eathe the easi er for it. So it's not a matter of disagreeing.

The point I have to re- empha size, though, is that for a province of one mil lion peopl e we are engaged rather heavily in investme nt in energy for the futur e. For us to be distracted or to commit additional financing on any substantial scale for research into some of these forms that the Member for Fort Rouge is talking about does not seem ju stifiable. I'm sorry if we disagree but that is the consensus of view of the government. When someone el se, some other group are voted the re sponsibilit y for administerin g the affairs of the provinc e they can change the policy and prioriti es.

The Member for Rie l has , in hi s discour se - I mean if ther e' s ever a case, mayb e it's a red le tter day - but liste ning to him I could only agr ee as a layman one hundred perc ent with what he was saying with the exception of the last two minutes of his speech. But you know, even there it' s a very intere sting and clo sely re asoned differenc e of opinion. I mean, well to begin with he says that he is please d to see that the government has, in mor e rece nt years, come round to the view of all out effort relative to the renewable energy resource harnessing.

I guess I have to accept that observation, but it is - it im plies that at one point in time some of my coll eagues may have be en opposed to that, and I don't beli eve that would be trm •. It might be mo re corre ct to say that until 1969 or 1970 we never had an opportunity to demonstrate our policy position with respect to energy development.

Bu t I can give my honourabl e fr iend one concr ete exam ple which I think does demonstrate that we very quick ly did assert our policy with respect to energy and that was back in the very early '70s, I think it was the first few months of 197 0, We faced a rather im mediate or immi nent dec ision as to whether to approve of the pl acing of an order for gas turbine ge neration capaci ty or whether we should avoid doing so and take some calculat ed risk, but then procee d

25 80 May 14, 1975 CAPITAL SUPPLY (MR" SCHREYER cont'd) ..... all the more quickly with harnessing of the Nelson. And the decision is history now. We decided not to put any millions of dollar s into gas turbine capacity or extension of thermal capacity, but rather to go ahead with the harnessing of the Nelson River. The honourable member of course can say that we delayed or dithered for one or two years when construction should have proceeded in its full momentum and I accept that there is that area for plausible argument.

My counter argument would be however, that we did take the decision not to delay but to advance by a few years regulation of Lake Winnipeg. So that is not a delaying of harnessing of renewa ble energy, but in that one aspect at least it is a speeding up of the harnessing of renewa ble energy.

With respect to whether or not it has cost us, cost us dearly, or cost us significantly, the fact that there has been a delay of approximately 30 months in the diversion of the Churchill River, I would say that with the benefit of hindsight now, I think we can demonstrate that we didn't really need the energy that much sooner. We do have sufficient capacity in place. That had we started three years earlier with Churchill River diversion, I belie ve it would have been with the result that we would have had that much more energy for extra-provincial sales to Ontario , Saskatchewan or Minnesota.

So I'm not quite sure that I can understand or agree with the honourable member's specific criticism with respect to delay. As a matter of fact in some sense I've alr eady said , we have really done the opposite of delay and that is speeded up. But other than that I won dered if whether this was perhaps one of those unique days in this Ass embly's deliberations when one could be 100 percent in agreement on both sides of the floor with respect to any issue" And certainly I was , with the Honourable Member for Riel.

I want to take this opportunity to say to the Member for Fort Rouge that he is exhorting us or ad monishing us for even thinking about the advisability of investing Manitoba public funds into Syncrude. Well, as I said on Friday - on Monday, the day before yesterday, that having li stened to the arguments of honourable members of the Conservative Party that we should have put funds into Syncrude. Our position was stated that we feel that we are investing heavily enough in energy development.

I personally do not quarrel with the amount of public financing involved in Syncrude by those jurisdictions that did become involved. For our part, if the Government of Canada would be willing to do likewise in terms of quantum of federal financing or proportionately scaled down with respect to research development, pilot plant construction with respect to methanol, the Provine e of Manitoba would be willing to invest, putting this more in terms of principle and policy rather than with the benefits of a specific cost benefit analysis.

But theoretically and in principle we would be willin g to invest in other than Hydro electric energy development with the Federal Government.

And indeed one can ask the question rhetorically, and more than rhetorically, if the Government of Canada is prepared to invest in Syncrude - for the reasoning used by the Member for Fort Rouge hims elf - what if not to spr ead its risks, spread its insurance so to speak, and put some funds into the developm ent of methanol production which has qualiti es or characteristics that lend themselves to fairly practical use even in the present day and age, let alone a dist ant future. So there are indeed some interesting and exciting possibilities.

But the Member for Fort Rouge, if he is so pre occupied with this he ought to be contemplating running for the Federal Parliame nt in 1977 , or 1978 in Winnipeg South or Winnipeg South Centre. I suppose the Liberal Party will be looking for candidates in both places according to rumours. And he may well like to return to the Ottawa scene where his comments would have a littl e more relevance than they would here. The Member for Riel also referred to a certain controversy that was going on a few year s back about the export of water as opposed to the export of renewable energy.

I am not as familiar in detail as the Member for Riel is with that particular episode in our political history. But from everything I know the Member for Riel certainly seems to be correct, and it really raises the question which I really cannot resist referring to from time to time, and that is back in the early 160s when important decisions were taken with respect to the building of the Red River Floodway, Portage la Prairie Fl oodway, the Asse ssipi , the Shellm outh Dam. I felt then and I feel now that two of those three decisions were the right ones.

I don't think there were any alternatives really, and they were the right decisions. Namely , there was no alternative to the floodway here; and I rather suspect that the Member for Roblin would nod his head in agreement that the Shellm outh Dam was and is a useful water control development - and he is - and a pity therefore that the Holland Dam which I know that a former Minister of

May 14, 1975 2581 CAPIT AL SUPPL Y (MRo SCHRE YE R cont'd) ... .. the Cr own was very enamo ure d of and very much in favour of for some re ason which still re mains mysterious to me, was, despite his support for it, never proc eeded with. I suspect that the Member for Rie l could indicate some of the reasons for that. It re lates back to the same phenomenon with respect to who was involved in water control advice in those days.

However , that perhaps is history, although one would hope that it is not com pl etely academic, that pe rhaps a decade from now, if it' s not too late, pe rhaps a decade from now the cost be nefit will come back round so that a darn at Holland , Manitoba, will indeed become a re ality as it ideally speaking should have in place of the Portage Diversion back in 1962 or 1963. Jus t before I conclude I would like to respond to the Memb er for Radisson.

I want to point out to the Me mber for Fort Rouge that he is raising the spectre again of some kind of a grave le gal com plication with re spect to Churchill Rive r diversion. He need not re mind us of the possibility of continued and protra cted litigationo But you know, that has been more or less the order of the day for the past six years.

I am not going to take this opportunity to express my deeply felt feelings as to how the Government of Ca nada has be en conducting its elf in thi s rather thorny problem, except that I feel that ther e has bee n some br eaching of ethics in the sense that ce rt ain curr ent minister s of the Fe deral Cr own seem to be blissf ully unaware of the signing of the Ca nada-Manitoba-Ne ls on River Agreeme nt of 1966.

They're now providing , pe rhaps unbeknownst to them selves, providing financing not only to ensure that the re's adequate lega l counsel for the dealing of claims which is per fectly fine, I mean that should be done, but some of those funds may well be used for the thwartin g or the attempted thwarting of an energy development proje ct which is specifically provided for in a Fe deral-P rovincial agreeme nt that is now nine years old.

I don't know if it causes any embar rass ment or discom fort to pe rsons such as the forme r Minister Jean Luc Pepin but it would seem as though cur rent Fe deral action is rendering his signature absolutely me aningless. So that if there is, in fact, serious litigation upon which Manitoba is involved with respect to the Churchill Rive r diver sion then as quick as one can say Jack Robinson the Federal Governme nt will be involved as a De fendant as well . That much is clearo --( Inte rje ction)-- Just one mome nt.

The Member for Fort Rouge says - I believe he indeed did use the word "r u shing" - that we were ru shing ahead with som ething and in fact what is be ing proceede d with is what the Honourable Member for Rie l h as intimate d we have been delaying with, so that I feel that the two ge ntlemen have a very different perce ption of the timing and the proble m involved here. Ther e is no quest ioning the fact, however, that we have attempted to minimize any dislocation with respect to Churchill River diver sion.

In the final analysis however , it still involves a trade-off as be tween conflicting and opposing desires, environm ental protect ion, human settle me nt prote ction. But on the other hand to go any further with respect to minimi zation of the dislocation or the am ount of shoreline flooding would be to render practically valueless the Churchill Rive r diversion concept its elf. So, honourable members who have had experi ence in governme nt on the other side will realiz e that the proc ess of trade-off of conflic ting requi re ments and argume nts is never ending.

With respect to the question of fish, the protection of ce rtain speci cs of speckled trout, I am comple tely at a loss as to how to respond to my honourable colleague" He is perhaps in as good a position as I am to try to influen ce the deci sion- making with respect to the possibilit y of build ing weirs or whatever that might provide some protection to that particular specie s of fish. I'm referr ing to the river s that are near the site of Lime stone, the proposed Limestone gene rating plant.

I just cannot see how any assurance can he give n inasm uch as whateve r is be hind the clam itse lf needed for the head for the gener ating pl ant, just how you can achieve that, and yet not flood som e of the rivers that flow into the - oh, I'v e forgotten the word - the lake that form s be hind the dam, the forcbay. I don't be lieve that any kind of assurance can be given ther e except that I would he surprise d if all rivers that are habitat for the speckled trout will be affected to equal or serious degree. So I don't think ther e's need to he comple tely pes simi stic about it.

MR0 CH AIRMAN: The Honourable Member for Assiniboia. MR 0 STEVE PATRICK (Assiniboia) : Mr. Ch airman, I just have one que stion to the Fir st Minister . I be lieve the First Minister passe d over very lightly in re spect to the negotiating team with the nati ve people up North with the Indian people. I just wonder what is the IJrogress

2582 May 14, 1975 CAPITAL SUPPLY (MR. PAT RICK cont'd) ....• and where are we at at the present time ? The other point that concerns me and I would like to know, the First Minister indicated that some Federal Ministers were thw arting progress, and I'm really interested and I'm con cerned. I'd like to know just what he meant ? Perhaps he can expand on both of those quest ions. MR. SC HREYER: Well , Mr.

Speaker, as the Honourable Member for As siniboia is perhaps aware, the Federal Government announced approximately a year ago - it may be slightly more than a year ago - that they would be providing funding to an entity known as the Northern Flood Committee for purposes of legal counsel and related expenses. We wanted to be advised as to the precise nature of the applicability of these funds, and were advised at a meeting in Ottawa that these funds were for the purpose of ensuring adequate legal counsel and representation with respect to the settlement of claims.

We regarded that as somewhat re dundant but we didn't quarrel with the objective. Although it was redundant in the sense that the province has given an undertaking all along that it would provide funding for legal counsel , legal representation on settl ement of Claims for damage.

However, what seems to have been at least possible of happening, transpiring, is that some of that funding would be going towa rds the legal costs of trying to scuttl e or bl ock the project being proceeded with, and in that re gard we do have a very definite position indeed , and that is, that any efforts to scuttl e or thwart the project would be not only impractical but ignoring the fact of the Canada-Manitoba N elson River Agreement which right on Page 4, I believe, provides, in fact, enumerates that diversion of the Churchill River shall be one of the four major features of the carrying out of the intent of the Canada-M anitoba-Nelson River Agreement so I was assured personally that, of course that federal funding would not be, could not be used for that purpose.

But by in direction it may still be , and that's of course one of the things that I can't answer as to what ultimately will happen. But it is however one of the reasons why we wer e quite determined to proceed with Lake Winnipeg regulation simultaneous with Churchill Ri ver diversion because in the event that Churchill River Diversion were blocked by litigation, which I think is a pretty far out prospect but in the event it were, we would have been in a fine pickle indeed in 1975- 76 and for the next couple of years. Lake Winnipeg regulation eases the criticalness that might be caused by such a prospect. MR.

CHAIRMAN: The Honourable Member for Fort Rouge. MR . AXWORTHY : Mr. Chairman, I would like to , if I might, pursue some of the com ments made by the First Minister in the matter of the legal funding of counsel. First the Mini ster seems to indicate that there wa s, under the signing of the agreement between the Federal and Provincial Government on the Churchill Diversion a legal right of ..• the Federal Government is involved in this as a legal partner with the province.

Would the First Minister not also believe though that the Federal Government because it has a prior legal claim on it in terms of the treaty rights of Indians , treaties being signed many many years, far before that particular power arr angement was arrived at, and that they must have the right to live up to their legal requirements under the treaty assignments; and secondly, I find myself perplexed by his definition of what legal counsel requires. As I gather he said it was all right to fund legal counsel but not all right for legal counsel to take what they considered to be the legal interests of their clients.

I would like to, because I assume that legal counsel in this case would sit clown and work with their clients and as legal counsel always does, or should do , work out the best pos ition in relation to the protecting of interests of that client and if that interest happens to be to go to court, then that becomes part of the proper relation ship between a counsel and his client.

I find myself wonder ing if the Premier feels that that was not the proper course of action, that that legal counsel should not have advised his cli ents such, and if there's some caveat or something that he felt should have been entered into, or was entered into, to prevent that from happening, if so, it being a very strange legal arrangement indeed. MR. CHAIRMAN: Honourable Fi rst Minister. MR . SCHREYE R: Mr. Chairman, one thing I will not easily agree to is to the Honourable Member for Fort Rouge putting words in my mouth.

It is obvious that legal counsel acting on behalf of anyone will try to maximize the bargaining position of his cli ent or clients, and no one is questioning that fact. However, we think that we would be not only naive but not protecting the public interest of the Province of Manitoba if we were to sit quietly by and see certain assumptions being made, and action being taken on the basis of those assumptions , which was

May 14 , 1975 2G83 CAPITAL SUPPLY (MR, SC HREYE R cont'd) •.... inimical to the interests of the province, but not only that, sir, also departing and de viating from fact. One of the facts of the matter is that Canada and Manitoba si gned the 1966 Ca nada-Manitoba-Ne lson Ri ver Ag re em ent, which enumerates for the proc eeding with the construction of Churchill River Dive rs ion. Unless a Minister of the Cr own knew what he was signing, he must have known that such a diversion would involve some quantum of flooding.

Ther e are only two entities in Ca nada that have sovere ign juris diction ove r land, a pro vince and the Governme nt of Canada. There is no third entity with sover eign juri sdiction, Also , the curre nt action se ems to be ignoring com pletely the fact that there is a fulness of preced ent with re spect to the transfer of land between one juri sdiction and another, with res pect to neces sary public works.

And this has taken place in every province in Ca nada during this and even the pre vious ce ntury, so that ther e se ems to be a bit of playing of games her e which we ar e not particularl y willing to go along with. Ce rtainly we want all of the con ditions and facts that surrounded the procee ding with Nelson River Development to be fully understood by all parties involved. We have never, Mr. Chairman, re sisted the argument that ther e should be adequate legal counsel with re spect to settlement of claims, offers of which were not found to be satis factory by those affected.

And ind eed, we have co mmitted in writing, that if there is no satisfaction, that Manitoba, willingly and in adva nce, agrees to submit to third party arbi tration , and we would find no gre at di fficulty in hav ing Canada named the third party arbi trator. But one fiction we cannot live with is that there is no pr ecedent for what is be ing done, or that secondly, the fiction that we have no ri ght to proc eed and therefore negotiations on specific damage and specific claims will some how take place in an atmo sphere of extortion because we have no ri ght to proce ed.

MR, CHAIRMAN: Manitoba Hydro Electric Board :s:l5 ... The Honourable Mem ber for Br andon West. MR , McG ILL : Mr. Chairman, a year ago in the debate on this capital supply item for Manitoba Hydro, the First Minister re lated the decisions by Manitoba Hydro on nuclear powere d generating plants with the completion of a third structure on the Nelson, and in this debate he has re lated it to the mid 1980s, and I don't know whether there' s anything incon si stent with the two but in the year that has just gone by , is there any change now in the time table with re spect to nuclear generation?

Do the firm comm itments take place re ally with the com pletion of upper li mestone, or ar e they now taken in re spect? MR, CHAIR MAN: The Honourable Firs t Minister. MR, SC HREY ER : Mr.

Speaker , I believe that the Member for Br andon West will have no problem in understanding the time sequence her e, if I simply outline, you know, the one sort of ass umption, and that is, that when we are looking to a nuclear insertion into Manitoba 1 s electric or energy de ve lopment progr am, long-ter m program for the next 20 year s, the reference to the first nuclear plant co ming on str eam, it' s really a band rather than a specific year and that band is at or about 1985-86 - that could be alter ed by a ye ar or two later but not likely earlier - and so the Systems Planning decision that Manitoba Hydro is having to wr estle with now is whether a nuclear insertion should be br ought about before or after lower li m(,� stone.

I be lieve that's the $6 4 do llar question, the multi- million dollar ques tion. MR , McGI LL: On e other question, unrelated really , but in terms of the $:l:l5 million that Hydro needs for its capital supply this year, what money marke ts has Hydro been in ve stigat ing with resp ect to rai sing this money, or have they proc eeded to that point. MR, SC HREY ER : Mr.

Speaker , the money market inv estigation is one that is carrie d out larg ely by the Department of Finance, and as I had occasion to mention on budget night, this and pr evious governments have be en fortunate to be well served by one of the top people in the field in Canada. You know spceificall y we have be en look ing at the Eu ropean money market and the Ne w York, large ly , and watching the Canadian money market, although in re c ent months it has not be en particularl y attracti ve. Ther e is no one single answer to my honourable friend's question.

The dependency is still on the New York and Europ ean marke ts. I don't be li eve there is any im mediate intention to look ser iously at the Japanese capital market, although it looked interesting 2 1/2 years ago, 2 ye ars ago or so. If my honourable frie nd has some thing mo re specific in mind , I'l l try to reply. MR, McGILL : Mr, Chairman, I re call that a year ago there were some specific names

258 4 May 14 , 1975 CAPITAL SUPPLY (MR. McGILL cont'd) ..... of investm ent houses in the Bost on area that were mentioned - whether or not they're also in the market again this year - but I was thinking particularly of the declining position with respect to the Canadian dollar , and whether this is going to make any difference in the sources of money that ar e open to Hydro in the next few months. MR. SC HRE YER: I would try to answer this way, Mr.

Chairman, that I don't think that the movem ent in terms of foreign exchange rates of the Canadian dollar will have any material bearing on the financing plans because candidly I don't think we had any heavy expectations with respect to the Canadian money market in any case. I don't think it's realistic to think in those terms of heavy reliance in the Canadian money market now, so that foreign exchange rate notwithstand ing, we are in all probability still committed to dep endency on the same money market sources that we were a year or two ago. MR.

CHAIRMAN: Item passe d, Manitoba Telephone Systems, 40, 576 , OOO. The Honourable Member for Birtle-Russell. MR. GRAHAM: Mr. Chairman, I hesitate somewhat to rise at this time. I had thought about it, and then I thought that perhaps I should tell the First Minister a story, a personal story that occurred to me over this past wee kend. I'll tell you the story first, and then I'll give you the explanation of why I'm telling the story, afterwards. A ME MB ER: Give him the answer and then ask the question. MR .

GRAHAM: I had a friend of mine came in from Minneapolis - he's with the Burl ington Northern Railwa y - and I wanted to meet him either Sunday night or have breakfast with him Monday morning before he went back to the Twin Cities. Be ing home over the we ek end and thi s being seeding and myself being a farmer, I am the first to admit that I wasn't in the house too much of the time, but every time that I came into the house I tried to phone this person, and every time that I tried to get the phone the operator told me that she was very sorry, there were no circuits.

Now I realize that Sunday being Mother's Day ther e is pro bably a greater than normal use of long distance, but at the same time I had tried Sunday morn ing, I tried at noon when I came in, I tri ed again in the late afternoon, and then when I came out of the field at 10 :00 o'clock at night I tried again from then consistently till almost mid night. Finally in desp eration, Mr .

Chairman, when I was already on my way into Winnipeg, and this was very close to midnight, I had stopped in Foxwarren for fuel and tried to phone there; I tried to phone from Shoal Lake; I tried to phone from Minnedosa, and finally I asked the operator how many circuits they had available for long distance to Winnipeg and they told me 14.

Now fortunately it was not an emergency but I had been unable to get a call through, and on the whol e day I had been unable to get through, and I was not able to get through until I stopped in Neepawa, which came under a different exchange system, and then I was able to get my call through to Winnipeg. The reason I raise this, Mr.

Chairman, is that several years ago when changes were being contemplated in the Russell exchange, there was considerabl e concern expressed to :Manitoba Telephone System at that time, and there wer e several meetings held regarding the proposal to make the Russell Exchange a toll office because concern was expressed at that time that there would be an overloading through the central exchange where all that area now channels its long distance phone calls through the Minnedosa exchange.

We' re finding now, sir, that the fears that were expressed at that time are now becoming a reality because it's only in the last four or five months that the Russell exchange has become an automatic exchange and all the calls now are being channelled through Minnedosa. MR. CHAIRMAN: Order please. The hour being 4:3 0 , Committee rise and report. Call in the Speaker. Mr. Speaker , your committee has considered certain resolutions, reports. progress and begs leave to sit again. IN SESSION MR. SPEAKER: Order please. The Honourable Member for Logan. MR. WILLIAM JENKINS (Logan): Mr.

Speaker , I beg to mo ve seco nded by the Honour able Member for Emerson, that the report of the committee be received. MOTION presented and carried.

May 14, 1975 2585 PRIVATE MEMBERS' HOUR MR. SPEAKER: First item is priv ate mem bers re solution. Res olution No. 11. The Honourable Member for Riel. MR. CRA IK: Mr. Speaker, in view of the foregoing debate and comme nts I'l l have this matter stand. MR. SPEAKER: Very well. Re solution No. 12. The Honourable Member for St. Matthew s has 16 minutes. RE SOL UTION NO. 12 MR. WALLY JOHANNSON (St. Matthews) : Mr.

Speaker, some weeks ago when we last dis cusse d this Re solution No. 12 , I entered the debate pri marily because we had ju st heard a series of Tory speakers ris e in their seats, from their seats, and launch an attack on this gov ernment be cause it was doing nothing to help the beef grower s and the cow-calf producers. This struck me as be ing so funny co ming from a grou p who pride themselves in being free enterprisers .

Here they were ca lling on us to come to the support, come to the help of the co w-c alf producers who were in trouble financially, because of the fact that they' re not getting ad equate price s for their products. Bu t the thing that I found even more funny, more ironic, was the fact that time after time they stood up in their place and they called on the government to help the cow-calf producers, but they wouldn't make a stateme nt about their policy. They wouldn't make any kind of co mmitment as to what they would do. The cow -calf producers were asking us, the government, 1D give them $40 million.

The Conservative Opposition stood up and told us 1D help the cow-calf producers. At the same time they have be en attacking us for year s now for spending 1Do much money, and yet they wouldn't stand up and tell us what they would do. The re ason is very simple, Mr. Speaker , they don't have a policy. Yo u know, Mr. Speaker , the member s opposite pose as free enterpriser s, but they're hypocrites, they are the worst collection of hypocrites that I have ever seen in my life, and I have seen a few hypocrites in my day, but that coll ection opposite is the worst collection of hypocrites that I have ever seen.

As I've said before, as I've said be fore, Be njamin Di srae li once descri bed a Conservative government as an organized hypocris y, and I've used this in the past just 1D have a bit of fun. Bu t over the past year , sitting with the Conservative members on the Co mmittee of Land Us e I've re ally come to re alize how true Disrae li's statement is. I've really come 1D re aliz e what a collection of hypocrites Conservati ves ar e in this prov ince. There was an

article by Fra nces Russe ll some weeks ago in the Free Pr ess, and I'l l quote it because she makes a very pr eceptive poi nt. And she says, and I quote: "T here is little question that the long Tory hegemony in rura l Manitoba, particularly the southwestern part, is mer ely being solidifie d by the curr ent gove rnment programs in agri culture, and in other ar eas. Fa rme rs, particularly wealthy ones, are notorio usly anti-socialists, although they are always, wealthy or not, the first on the government's door step when financial prob lems loom. " And what happens, Mr.

Speaker , when the cow-calf producers are in trouble ? They're at the government' s doorstep. The Le ader of the Opposition made a statement in his rc'J)ly to the Throne Speech, which really be trays the Conservative po sition. He sa id, he referre d to us as taking our turn at the public trough, taking our turn at the public trough. It' s not our attitude to gove rnment, but it ce rtainly is their attitude to gov ernment. They regar d government as the public trough to be used. And, Mr.

Speaker , tht >r e' s a fundamental differ ence between their attitude to govern ment and ou rs, George Be rnard Shaw once de scribed a socialist as one who believes that he has a res ponsibility to pay back to soci ety ev erything that socie ty has gi ve n him, with an addi tional am ount to be used as capital for the next generation, Now that' s a socialist attitude towards government, it' s a re sponsible attitude towards soci ety; it do esn't use society as somet hing 1D be used. But it's not a Conservative attitude to society or to gover nment These Tories claim 1D be gr eat fretJ enterprise rs.

Now what ar c the· [acts ? What ar e the facts ? We found out on our tour of the province, for example, that MAC C has loaned out over so mething like $88 million in loans throughout the province, and we're given a map which shows the breakd own by region, and, Mr. Speaker , what do you think we found? That the loans go to the poor farme rs, to the areas of pov erty in the province? No. The bulk of the loans, about two-thirds of the loans went into the southwest, into the wealthiest far ming area in this province. And who -- (Interj ection)-- They work hard.

But they ce rtainly use the money of the public in Manitoba.

2586 May 14 , 1975 RESOL UTION 12 A MEMBER: They're smart operators. MR. JOHANNSON: Yes, they're smart operators, they use the public trough, they have used it for many years. And who represents that area, Mr. Speaker ? Who represents this area that feeds at the public trough more than any other part of the province? The Tories. These great free enterprisers. --(Interjection)-- Oh yes, he was an interesting fellow too , another free enterpriser who used public money. We also found, Mr.

Speaker , on our little tour of the province on the Land Use Committee, that the Conservative Government when they were in power, set up a system of MACC guaran tees to the banks. This was their agricultural policy, one of their agricultural policies. It was a nice system, Mr. Speaker. They were promoting free enterprise. It was a beautiful system. The bank would make a loan to a farmer; it would get either all or part of the loan guaranteed by MAC C. If the loan was repaid, the bank made money; if the loan wasn't repaid, who los t? The people of Manitoba.

What a beautiful system, The banks couldn't los e; the only people who could lose were the people in Manitoba. Another example of Tory free enter prise. Mr. Speaker, I've been connected or associated with the housing program in the provinc e since about 19 70. I've been following it very closely. And we've built a lot of housing in rural Manitoba, and I was quite proud of this fact. In fact I've made a number of speeches in the House congratulating us on building in rural Manitoba.

Then a year or so ago, I started looking at the map, and started checking up on where the housing was being built, and what do you think I found? This great free enterprise area of the province, the area represented by those great free enterprisers, was getting more public housing than any other part of the province. They hate government but they sure love our housing. I also can recall , Mr. Speaker, the period when we had our PEP program, the pensioner home repair program, the PEP grants to various municipalities and communities, municipal loans.

I can recall getting up in this House and being quite please d about the fact that our loans , our money had gone primarily into non-government constituencies, and I was proud of the fact that we were being non-political in our handling of this program. I was stupid and naive in those days, Mr. Sp eaker, I was really stupid and naive. I thought that this was something to be proud of. The members opposite knew better. They knew that their areas were making use of public money more than any other, and I'm sure they probably promoted it. I don't fault them, they made use of money that was available.

But once again, once again, Mr. Speaker , this free enterprise area, these great free enterprisers, were first at the public trough, they were first in line. Some time ago, just before the election, I recall there was a controversy in the House here. The Premier brought up the fact that even though the Opposition were screaming in the House and on the hustings that this government was giving welfare to everyone; that we were destroying private initiative by giving welfare too easily.

At the same time as they wer e doing that, the Pre mier said, members opposite, the Member for Roblin and the Member for Swan River were first in line at the Minister 's office, at the Minister of Health and Social De velop ment's office to pl ead to put their constituencies on welfare. And I can recall the member s opposite sc reaming in indignation that the Premier should be using private lett ers. Yes, I can recall their indignation. Yes, I can recall the indignation. But you know, Mr.

Speaker, I would be prepared to bet, I would be prepared to bet that most of those free enterprisers over there who get out in the public hustings and scream about welfare abuse, I would be willing to bet that almost any one of them has pleaded or put more people on welfare than myself. I would be willin g to plac e a fair amount of money in a bet. --(Interjection)-- There are very few people that I go to see the Minister of Health about welfare cases, very few. MR. SPEAKER: Order please. MR. JOHANNSON: And I am a socialist who 's supposed to be pro welfare and supposed to be putting people on welfare.

But I would be willin g to bet that most of those people opposite have been putting far more people on welfare than I have. I missed the last meeting of Eco nomic Developm ent Committee which was looking at the MDC report, and I gather that the pro posal of an additional $4 million investment in Morden Fine Foods was brought up. --(Inter jections)-- Do they what ? I wasn't ther e so I didn't find out whether the members opposite are promoting this or oppo sing it. But, you know, I chall enged the Member for Pe mbina before, and he hasn't answered.

I want to find out how true you ar e to your principl es of free enterprise.

May 14, 1975 2587 RE SOL UTION 12 (MRo JOHANNSON cont'd) ..... I want to find out whether you' re pro moting Morde n Fine Food s, which is a fine organization, but it' s government enterprise. I want to find out if you' re prom oting it. I want to find out if you' re supporting an additional $4 million public in ve stment in a government-owned public enterprise in your comitituency. I want to find out whether these people are going to be true to their principles or whether they're going to con tinue in their hypocrisy. MRo SPEAKER: The Honourable Mem ber for Birt le-Russe ll. MRo GRAHAM: Thank you, Mr. Speaker.

You know, the memb er who has just spoken knows whereof he speaks when he talks about hypocrisy. Mr. Speaker , the problem that he has bee n addressing himself to has be en one that has been se lf-induced by this government. Mr. Speaker , I don't think, I don't think the farmers of Manitoba ever asked the province for the programs that the government has introduced. I don't think that the government ever consulted with the farmers be for e they brought forward their program. But, Mr. Speaker, if the Membe r for St.

Matthews conveniently forg ets - and I don't think that his memory is rea lly that bad , so I have to say that he must conveniently forget - let me refer him to the NDP Bibl e again, the Guidelines for the Seventi es, and let' s look at Volume 1, and the programs that this gov ern ment has br ought forward for agri cultur e in Manitoba.

It' s no secre t that everyone in Manitob a, they hope that everyone in Manitoba at least, has re ad their Bible and they would like every farmer to follow their policy , they would like every per son in Manitoba to follow in blind obe die nce to their dictates , and like sheep they can all then be led to the slaughter. Mr. Speaker, it' s no seer et that the Minister of Agriculture and the gove rnment have be en. dis satisfied with the agricu ltural program. They brou ght out their Guidelines in which they stated that the expanding agricultural output in Manitoba must be in beef production.

The deve lopment of the cattle industry in Manitoba has be en a policy of long standing. Manitoba agriculture has not maximized the income potential from the liv estock production in the pro vince. And it goes on and on and on. And this government, and other NDP governments, be cause they're all alik e, they all follow the Bi ble, they br ought forward their program which was goi ng to bring this about. They offered special forgiveness to anyone that was purchasing liv estock.

This occur red in Manitoba, it occurred in Saskatchewan, it' s a consistent NDP philo sophy that what one gov ernment brings forward another one will implem ent; they all follow the same blind approach. So when they brou ght forward their program to help the young farmer get started in live stock production, the first thing that they failed to re alize wa s that the program they envisaged would not help him at all. In fact it hurt him. When they put forward their gra nt program, what happened'? Immediately the price of cows and bre d heifers jum ped $1 00, just over nig·ht.

It didn't help the fellow that was getting into livestock, it helped the fellow that was getting out. And this government said that they were going to help and encourage the livestock industry. And I would say that those that took

part in the program were those that be lieved, actually believe d that gov ernment was going to help them. They were people that had bee n convinced of the wi sdom of this go

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Collection	Manitoba — Debates (Hansard)
Citation	30-2-85
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Volume / chapter	30th 2nd hansardpdf 85.pdf
Language	en
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