Volume 4 PROVINCE OF NEWFOUNDLAND THIRTY-SIXTH GENERAL ASSEMBLY OF NEWFOUNDLAND 4th . Session VERBATIM REPORT WEDNESDAY, JUNE 18. 1975· SPEAKER: THE HONOURABLE M. JAMES RUSSELL Number 53

June 18, 1975 The House met at 3:00 P.H. Mr. Speaker in the Chair. Tape 2409 (Afternoon) PK - 1 MR. SPEAKER: Order, please! I understand we have in the galleries today a delegation from the Town of Bonavista and, of course, from the district of Bonavista South: Mayor Gordon Bradley and Councillor Fred Gosling and the Town Manager Calvin Rose. On behalf of all the honourable me11bers I welcome you here today and trust that your ... visit is most interesting. STATEMENTS BY MINISTERS MR. SPEAKER.: The Hon. the Premier. HON. F. D. MOORES (PREMIER): Mr.

Speaker, last evening I was contacted by the CBC regarding the layoff of s011e 800 personnel, civil personnel, at Goose Bay. The story out of CBC at that time was,as I said, confirmed by a source in Ottawa was that the Americans were withdrawing from the Base as of June 1976, and that people would be phased out froa now until then accordingly.

Now at that t:lae that was totally new to me, I have found out since then that the minister reaponsible for Intergovernmental Affairs, the inister responsible for Industrial Developaent,vho vould noraally be contacted in this aatter,also hacl not heard anything about it whatsoever. 'With that in aind I contacted the Priae Minister this morning, I talked to hta about the subject, and when I had told him of the story he said, and I at that time intiaated that it had been confirmed by External Affairs, 7079

June 18, 1975 Tape 2610 (Afternoon) PIC - l l)is remark was that "I cannot believe it." And he knew nothing abClut it whatsoever. Now aince then he has contacted Mr. MacEachern the Minister of External Affairs, and he will be talking to the minister, our minister responsible for Intergovernmental Affairs later this afternoon. But to our knowledge or to his knowledge there is nothing being planned now or until the end of this year in that regard.

Now there may be negotiations going on whether the lease will be renewed for another year or not, but External Affairs have not advised us in any capacity nor have they advised the Prime Minister to that respect. The fact is, Mr. Speaker, I want to go on record at this time to illustrate and to declare how concerned we would be if that had been the case, and it still may be the case. It still has to be confirmed one way or the other, and until we hear from Ottawa we do not know.

Because whether it be a 'Whalesback Mine closing or whether it be a much more serious situation such as the Goose Bay area, if this is going to happen, a provincial-federal and local group of people, task force,if you like, should be set up at the moment it is known to try to create alternative employment and make the phasing down, if it is going to happen, or the closing or whatever it is going to be as easy as possible. But at this point in time, Sir, I would like to say that we have not had confirmation from External Affairs. We have asked. They said there is no confirmation to be made at this time.

The Minister of Intergovernmental Affairs will be talking to Mr. MacEachern this afternoon. I talked to the Priae Minister actually himself in his office twice this morning. The first time the Prime Minister had heard nothing about it, On the second occasion they said there was no truth to the fact that it was now or up until the end of the year. I asked the who called,does that apply to June.1976? He said, well I did not ask about June,1976, I only asked about now. I said, okay fine. When Mr.

MacEachern phones back would you be good enough to let us know exactly what the story is and if there is any truth in . • 70d1J

June 18, 1975 Tape 2410 (Afternoon) it, let the t,,o groups get together. Also at this time, Mr. Speaker, I would like to say that - and as I have mentioned just a moment ago, it is absolutely unforgivable if this has happened and the provincial government PK - 2 and the municipal authorities and the other concerned groups have not heen advised, But before saying too much in that regard I think it is only fair we wait to get the official Ottawa position. MR.. SPEAKER: The Hon. Member for Fogo. CAPT. E. WINSOR: Mr.

Speaker, I am sure we were all as shocked as the Premier was on last evening when we heard this horrifying news that there was a possibility of this Base being closed down, and we are very pleased that the Premier is keeping on top of it. Because, in my opinion, having served that district for fifteen years,it is a very serious thing if that Base should close, you have the Town of Happy Valley and Goose Bay itself.

It should not be permitted to close without a two year, the minimum notice in order to give this government a chance to try and relocate or try to provide alternate employment for the people of that area. I am sure they are very distressed people today. And I am very pleased to know that the Premier is keeping on top of it, and we would appreciate any further information. Thank you. MR. NEARY: Hear, hear: MR. SPEAKER: Are there any other statements by ministers? PRESENTING PETITIONS MR. SPEAKER: The Hon. Member for Bell Island. ~- S.A. NEARY: Mr.

Speaker, I beg leave to present a petition on behalf of a large number of interested citizens in the district of Bell Island who are very concerned, Sir, about the inadequacy of the ferry service and who are looking for improvements in ferry service. I will read the prayer of the petition, Sir, and then I will make a few brief com.ents after. To the honourable House of Assembly of Hewfoundland and Labrador.

The humble petition of the undersigned residents of Bell Island showeth that the ferry service between Bell Island and Portugal Cove is vital to the social and economic survival of the community of Bell Island and its people; that the Government of Canada

June 18, 1975 Tape 2/,11 (afternoon) IR-1 has fulfilled its obligat1on through heavy financial investment in the ferry service; that even with heavy federal involvement the ~ewfoundland Transportation Company ha,,e failed to keep in service at perioc!s of pe;ik traffic both ferries, the M.V. John Guy and the M.v.

Catherine; that such failure causes frustration to prospective ferry users especially those who conunute to work daily and loss of revenue to the operators of the service; that it is essential for the very existence of the people of Bell Island that the ferry service be made a part of our provincial highways system immediately and that the two ferries be put into operation to provide a shuttle service between Bell Island and Portugal Cove. 1 ' Therefore the undersigned humbly beseech the honourable Rouse of Assembly to give consideration of this petition and yo~r petitioners as in duty bound now prayeth and will ever pray." I might point out, Sir, that this is one of the few petitions where the wording of the petition is in order.

Now, }'r. Speaker, this petition is signed by over 1,noo residents of Bell Island including at least one of the doctors, Dr. Tucker who is,I suppose,the gentleman who took the initiative in circulating this petition and he and his committee are to be congratulated.

Some of the signatures represent members of the town council, businessmen, all the commuters, students who go back and forth to the College of Trades and Technology and the university and the general public at large, and some signatures of users of the ferry service who"live on the mainland but commute back and forth to Bell Island almost daily. ~ow, Mr. Speaker, I might say that some time ago the Government of Canada approved a hefty increase in the subsidy that the Newfounrlland Transportation Company was receiving to help the company to acquire a new ferry.

Members will remember that the Transportation C'omoany went to Europe and brought a new ferry called the, tte original name was The Romeo and she was later renamed The Catherine. My understanding, Sir, is that the Government of Canada is now putting almost $900,000 a year subsidy into that company in order for the company to get on a good financial footing and to 708L

June 18, 1975 Tape 2411 (afternoon) IR-2 maintain the service and purchase that second ferry that was supposed to take the place of the Kipawo, almost $900,000, and they have a ten year contract. Now, Sir, that boat, that new ferry is useless and will only henefit the owners of the Newfoun<lland Transportation r.ompany anrl not the people of Bell Islanrl unless it is userl at peak periorls, say from June l to the middle of Septem~er as a shuttle service ~etween Bell Island and the local mainland.

I <lid a little rough caculation myself, Sir, and I think it would cost somewhere in the vicinity of $10,000 a week or a paltry $100,000 a year to put two ferries in service from June 1 say up to the first week in September, a paltry SlOO,OOO. Now, Sir, the Government of Canada have indicated recently in a wire to the Reverend Father ~lcHugh,who heads another p;roup on the Island trying to get improvements in the service, the Government of Canada have indicated to }Ir. r:amphell, the <'hainnan of the Water Transport r.ommittee that the Covernirent of Canada is not going to put one more penny into the service.

So, Sir, if we are to get two ferries operating and get improvements in the service it is p;oing to have to be done by the provincial p;overnment,and members of the !louse will recall in 1971 and again in 1Q7:. the Premier of this Province indicated to the people of Rell Island that if he was elected, formed the government, that the ferry service would he made a part of the provincial highways system.

Here ls an opportunity now for the administration and the Premier to show their sincerity in this regard.Although this may not satisfy the people of Bell Island as far as making it a part of the provincial highways system, nt least it will show that the administration is sincere in their commitment.

So, Sir, I stq,port the prayer of the petition and I do hope, Sir, that the provincial government will be able to find that paltry SlO0,0OO this year and make sure that the people of Bell Island, especially those who commute back and forth. who a:ce t r:dng to earn a living for themselves and their family, that the government will be able to find that paltry $1O0,O(ln to improve the service and provide a shuttle service with tl>'o ferries operat1ng say from nm,' np anti l

June 18, 1975 Tape Z411 (afte:i::noon) about the middle of Sep:t:emher. It gives me great pleasure, ~ir, t:o present this petition and ask that it be fon,arded to the department to which it mlates. MR. SPEAKER: Th.e bono~able Melli>er for Had>our Grace. 1$- 3 MR, YO'OlfG: Kr, Speaker, I would like to support that petition on belt.al£ of thos .e people on l!ell Island. I know, Sir, how frustrating ;lt U sometimes to be waiting fo.r hours on both sides, on both Portug<1l Cove ~d on the Beach aide ttying to get back and forth. I know that the boat.a

June 18, 1975. Tape 2412 RH - 1 will come in. They will tie up there for hours and I am sure, Sir, there is an inconvenience to everyone travelling to Bell Island. Once again, Sir, I would like to support that petition. I am not indicating that I am supporting the honourable member. MR. SPEAKER: The honourable Minister of Industrial Development. HON, V. DOODY: Mr. Speaker, like most people in this Rouse, indeed probably all people in this House, I must rise and support the petition presented by my friend from Bell Island. MR. NEARY: I wonder why! I wonder why! MR. DOODY: Why do you wonder?

Most people are aware that there has been a redistribution act passed. But it takes a little longer to penetrate some of the more or less nimbled skulls in the House. SOME mx. MEMBERS: Oh! Oh! MR. DOODY: Mr, Speaker• the - MR. SPEAKER: Order, please! 'MR. DOODY: Down, down, down, down! The feeding time is not for another hour. As I was saying, Your Honour, the sentiments of this House and indeed of everybody in Newfoundland are certainly toward the :Improvement of the ferry service to Bell Island. Ve are all very aware of the problem; that the people on the Island have encountered during the past years.

Certainly the closing of the mines was a treaendous shock, both economically and socially. Since that time everybody has been concerned with the plight over there, nobody more than the people on this side of the House who, as we have indicated during the past few days, are currently carrying on negotiations to improve the econcaic and social conditions on the Island. I should also say that I think it would be inopportune for the Province of Newfoundland to take on the responsibilitirs which have been shouldered by the Federal Government.

The .transportation system between here and the Island is a Federal <'.overnment respon­ sibility,and where the Province can help it certainly will but it will help in pressing and pushing and forcing the Federal Government to do the things which it has said that it would do. I re111e111ber a

June 18, 1975. Tape 2412 RH - 2 little while ago the now ~inister of Tourism, the Minister of Trans­ portation and Communications, then Mr. T.V. Hickey who worked so hard and so long to get the Catherine in service and I remember at the time the plaudits and the great glee and great enthusiam that it was greeted with by the member, Mr. MR. NEARY: He came to Bell Island to a public meeting. MR.

DOODY: Came to Bell Island to a public meeting and everybody over there was very enthusiastic and the honou~able member over there accepted great credit for having done it and I will say without reservation that he did do a great deal of, put in a great deal of effort in getting the ferry in service. I think he deserves great credit for that. The honourable minister at the time, as I remember, worked long and hard also. I am sorry to hear him say now that the ferry is useless. I do not think that that is so. MR. NEARY: It is useless.tied up, tied up for eleven months out of a year. 'MR. DOODY: That is right.

Now we hope to improve the conditions there and to make it econom:Lcally feasible to get that ferry in operation on a reasonable basis.Not eleven months of the year. It has not been there for eleven months yet. MR. NEARY: No, but it will be. ----- MR. DOODY: But according to the prognostications and prophesies of the honourable member, this is what is going to happen. The difficulty is that the honourable member works on the assumption that things on Bell Island are going to be as they have been during his tenure of office and that is extremely unlikely.

So, nevertheless, Sir, I say without reservation that we on the government side of the House support that petition and we will do everything we possibly can to improve the communications between the mainland and the Island of Bell Island. MR. SPEAKER.: The honourable Minister of Transportation and Communication. MR. J. ROUSSEAU: I would just like to make two points on this, Mr. 7080

June 18 , 1975. Tape 241" RH - 3 Speaker. Last month or aonth and a ha!£ ago · I did receive a coimnmi­ ~tion from Mr·. Campbeil. the Chairman of the Water Transport ·Collnittee. who wanted to speak to me here in St. John's 011. the question of the Bell Island fer·ry. There vas s0111e r-eport in the papere a,t that t:fae that the ~ovince would be taking it over,which I did not say. ill I said was 1 assume that when Mr. C'.ampbell wm;i.ted to meet with me 01l the Bell Island ferry I pres,a_ned he wanted to discuss matters •ch as are contabed in the petition today.

So at that tfae be cancelled the iaeeting vhicb W,!!S to be within the next couple of weeb,and he wanted to take six or eight weeks longer to tie dawn swie facta,which I anticipat~ he vf.11 be tying davn. When these are tied dOVll to his sat:isfaction I : ~) s'

JIDle 18. 1975 Tape No. 2413 NM - 1 preellllle he will be in contact with us and certa:1.nly I have i.ndicat:ed and I aa w,re than willing to meet with Mr. Campbell on the question of the Bell Island ferry. I might also -ntion that duri.ng the meeting ve had last: week vi.th Hr.

Marchand in Ontario on Friday, the ten provincial 111.nisters of tranaportat:ion,when we talked about: the new tr1Q1Bportation policy our position provincially was,and I think it is fair to say that: the other three Atlantic Kinist:ers,and all the m.n:lsters indeed,would support the concept that while this new, envisioned transportation policy is so.ething that will be vecy desirable in the _next five. ten. twenty years or whatever the patt:em is• that we in Nevfo1D1dland and Labrador 1 and I guess we in Atlantic Canada and in other isolated a-reas of the coUlltcy feel that we cannot wait for the ,reat plan to come.

We still have :haediat:e probleas. such as the Bell Island ferry• such as probleai on the South Coast of Hevfoucdland in respect to the Canadian Hational.,plus the Coast: of Lab'i;:ador and other areas in respect: to transportation. and that our position is that while they are unveiling this plan,and while they are working towards what looks to us on principle. although we do not have det:ails,t:o be a good plan in the field of t:ransportat:ion 1until we get the details we are withholding comment:. but we know these problem; are there now and our position was that these problems have to be looked at. have to be remedied at this point in time. not the hope that in t:vo years or five years or ten years when the transportaion policy covers that specific point that it would be handled.

So we want to be very, while accepting the theoretical benefits of the major new thrust i.n transportation and the welcome news that now the H:inistcy of Transport is going to take it over rather than give it ~o the Crown Corporations to run as they wish. that we have iDEdiate needs, that these ianediate needs would be looked at. there would be improvements to them in the i.nterim while they are miveiling this new concept in transportation • . So ve are prepared to meet vi.th Mr.

Campbell on that question and I just: ,nmted to put that on record as to our feelings in respect: t:o not only the Bell Island ferry but other ferry systeas in the Province and 7088

June 18, 1975 Tape No. 2413 NM - 2 Coastal Labrador and the South Coast of isewfoundland and other areas and we will keep pressing the federal government on these points. MR. SPEAKER: Are there any other petitions? ORAL QUESTIONS: MR. SPEAKER: The honourable Member for Bell Island. MR. NEARY: Mr.

Speaker, the Minister of Finance, Sir, promised to get me yesterday, or the President of Treasury Board, either one, I think it was the President of Treasury Board, promised to get me an account, an updating of the loss of revenue to the Province as a result of the liquor store strike, Has the minister got that information today? MR. SPEAKER: The honourable Minister of Industrial Development. HON. C.W. DOODY. MINISTER OF INDUSTRIAL DEVELOPMENT: It was I who gave that undertaking, Sir, and the information has not reached me yet, I have asked for it but I have not received it as yet. It will be presented. MR.

NEARY: Mr. Speaker, could the Minister of Manpower and Industrial Relations tell us why Alcan has refused to accept a board of arbitration or conciliation board to ·try to settle the dispute at St. Lawrence, the labour dispute? Has the minister tried to persuade them to change their mind? MR. SPEAKER: The honourable Minister of Ma~power and Industrial Relations? HON. E. MAYNARD, MINISTER OF MANPOWER AND INDUSTRIAL RELATIONS: Mr. Speaker, I do not know the exact reasons why they have refused either the options that we have presented to them.

I would assume that this is an internal company matter but they have told me that from the coiapany point of view that they have made an offer, but they do not feel they cm1 revise or increase in any way. If they agreed to conciliation they would automatically be saying that there is more money there to be - or more leeway than they can give,and if they go to arbitration they feel that they would as well end up by providing more monetary benefits to the union,and I assume that is the reason they have turned down both options. -: :) s J

June 18, 1975 Tape No. 2413 NM - 3 MR. NEARY: Mr. Speaker, I have a question for the Minister of Municipal Affairs and Housing, Sir. Would the minister care to tell the Bouse if the dispute between the residents of the Conception Bay commuoity of South River and the melllber of the House of Assuibly for Port de Grave has been resolved? HR. SPEAlCER: The honourable Minister of Municipal Affairs and Housing. BOB. B. PECD'ORD1 MD1ISTER OF MUNICIPAL AFFAIRS AND HOUSING: Mr. Speaker, you will have to ask the council concerned and the mem>er. Hit. REARY: Well, Mr. Speaker, I put the question to the member.

Would the -91ber tell the Bouse if the dispute between he and the town council - HR.. SPEAKER: Order, please! MB.. REABY: - has been straightened out? MB.. SPEAKER: Order, please! Order, please! AR HOR. MEMBER: Point of order, Mr. Speaker. HR. SPEAICD.: Order, please -! That question is out of order as the honourable menl>er should know. Questions are directed to the Ministers of the Crown and not backbenchers. 70~:HJ

June 18, 1975, Tape 2414, Page 1 -- apb MR. SPEAKER: -- ---- The honourable the Member for Twillingate. MR. GILLETI: Mr. Speaker, I have a question for the Minister of Justice. I wonder if the minister can tell the House what is the status, I suppose, of the case concerning that ship that is tied up in Twillin?.ate, that vessel. It must have cost somebodv, the courts, I understand, which in turn is the taxpayer, it must have cost to date thousands and thousands and thousands of dollars in watchman's fees only - MR. NEARY: - -- -- You know the one. You said vou were putting "Mr.Avlward"on the case. MR.

GILLETT: How long is it p.oing to continue? Site has been there now for - ~~ !'!_EARY: When is it goinp; to he returned to its rightful owner? MR. __ DOODY: Good question! !!R'.. S):>EAKER: Order, please! The honourable the Minister of Justice. MR. RICKMAN: Mr.

Speaker, the question is somewhat vap;ue, but if the shin that the honourable gentleman is referrinp. to is t'lte one that I think it is, lJTf advice is that it does involve a matter that is before the court and obviously I have not the right nor should I comment on it other than to sav that the advice I received from the Director of the Public Prosecutions is that the case comes before the Grand Jury this month, I think it is the 26th. of June. It is sometime toward the end of June. l-Ol. GILLETT: --- --- A slll)plementary, Mr. Speaker.

Hho in the end, regardless of the results of the judgement, who in the end pays the watchman's fees all these months? Does the Department of Justice pav it? Does the court pay it? Or what? They are paying it now. MR. _H_!_CKMAN: Assuming that the matter is placed in custody, as I understand this was, custody is the word,or in the care of the Crown by the magistrate foll01ting a preliminary hearing, which ap.ain I understand is the case, regrettably the Crown has to absorb the cost. 'MR._ llJ!ARY: And write it off as a loss? 7091

June 18, 1975 Tape 2414 (afternoon) IB-2 MR. SPEAK.Ell: Order, please! The honourable Member for St. George's. "ffi. DUNPHY: Mr. Speaker, I would like to direct a question to the hon- ourable Minister of Forestry and Agriculture. Will the minister please indicate to the House whether or not any consideration has been given to the farmers in Westem Newfoundland in regards to a subsidy requested by me in a petition just recently'l KR. NEARY: Are you not speaking to each ·other outside tbe House? HON. H. CX)LLINS (MINISTER OF FORESTRY AND AGRICULTURE) : Mr. Speaker - MR. NEARY: Put it on the Order Paper. MR.

COJLINS: - the petition was presented,as I recall it,four or five days ago. I think everybody is aware of the fact that we have been anything but idle in the past few days but certainly it is being considered. _MR. SPEAKER: The honourable Member for Hermitage. MR. SIMK>NS : Mr.

Speaker, I wonder if the Minister of Finance has the answers to the question I raised a few days ago, questions relating to any smount of money that might have been paid to the former Deputy Minister of Fin!fflce upon his retirement from that position, whether in the form of severence pay or any amount over and above what would have been his normal wages and also the further question I raised on the four deputy ministers who had retired on full salary. I asked the minister to determine whether any of these were receiving any amotmts now from the treasury and if so, what amotmts. HON. H.R.V.

EARLE (MINISTER OF FINANCE): Mr. Speaker, I am sorry, but apparently the honourable member's colleagues are not speaking to him because I gave that answer a few days ago and nobody informed him. MR. SIMMONS: I was not here. MR. MURPHY: Catch up on your reading! MR. DOODY: Go read Hansard. MR. SPEAKER: Order, please! MR. NEARY: Mr. Speaker, a supplementary question. A supplementary 709l

June 18, 1975 Tnpe 2411, (ar terno on) lh-'J question to the minister, Sir , Would the minister tndtcate to the nouse if these four gentle men who have heen ret1 rett on full s.il;.r ·; will rer.,.ive any increments or increases as a result of ~eto t iDt • ~n~ now between Treasury Board and the vari ous groups involved In collective barg ainin g. MR. EA'RLE: T also gave that answer the other day. The answer! ~ no . 1'!'R. NEARY: Kr. Speaker , I have a questi on for the "1nister of . Justice.

Sir , will the Minister of Justice clear up the confus i on that exists in the Province as to the policy or any agreement between the provinces concerning bringing l iquor in to Newfoundland f rom other Provinces of Canada . What is the policy? Would the minister clear up

Jane 18, 1975 Tape 2415 (Afternoon) PK - 1 this situation, Everybody seems to be confused. What is the policy? MR. RICICMAN: Order Paper. MR. SPEAKEll: The question will be placed on the Order Paper. SOME RON. MEMBERS: Oh, oh~ MR.. SPEAICEII.: Order, please~ MR. NEARY: Mr. Speaker, would the Minister of Trmportation and C-ications tell the Bouse whether he vill talle a letter he referred to yesterday frca one of the manage11ent employees at the Health Science Coaplez concerning the diversion of -terial and labour to help build a private heme or put a base11ent in a house, vi11 the · llini ter table that letter?

MR. JlOUSSEAD: Tbe Miniater of Transportation and C:0-nicationa has no jurisdiction in that -tter. Mil. IIEAltY: Well,the Acting Minister of Public Works? MR. ROUSSEAU: No, Mr. Speaker, not at this point in t:llle any -Y• You~. these were private allegations that were aade at a private aeeting and I was to have.received an affidavit to the allegati~na· made and unofficially I was in contact with the person involved and I -s given a letter but until - I intend to investigate the matter certainly, and have the department investigate the -tter.

But until I get the affidavit or the charge officially I would rather not do it at this point in t:llle. But an investigation will be carried out and the results of which will be tabled. MR. NEARY: Mr. Speaker, a supplementary. Do I assuae then froa the llinister's answer that he may or may not table the letter at a later date? MR. ROUSSEAU: That may or may not be ao. In rl'spect to tabling the letter that is correct. It depends on the outcome,aaybe the report itself of just what happened would be sufficient without the letters. You know, there is nothing to hide actually.

If the honourable member would like to see it privately and confidentially he may do do. I may or may not - I would like to keep that under advisement. If you want to see it confidentially you are welccae to see it. 7094

June 18, 1975 Tape 2415 (Afternoon) PK - 2 MR. NEARY: Then, Mr. Speaker, "WOUld the s-e minister tell us whether he is going to table the report that I asked for, for the aonth of February to the minister's department concerning an unjustified and unwarranted atta ck on Newfoundland workmen by Scrivener management? MR. ROUSSEAU: I am sorry, I forgot. I have not had a chance to look into it, you knov. I did not. I will look into it, yes. MR. SPEAKER: The Hon. Member for Hermitage. MR. R. SIMMONS: Mr. Speaker, I have a question for the Minister of Mines and Energy.

I wonder would the minister confirm whether there is going to be a change-over in the billing methods? I understand now that the Power Commission reads the meters. and the same individual who reads the eters actually collects the aaount. Is it true that this lllethod is to be changed, there is to be central billing,and if so, and ore important,does it have any job baplications for the persons vho are involved right now? Will there be any layoffs in other words? MR. BAIUtY: Ia that the Power Comission or the Newfoundland B:,dro or the Newfoundland Light and Power? MR. SDDllNS: Well the Power C-1ssion.

The Pover eo-t.ssion 1a what I said, and that is what I aeant. But I think the ainister kDDV11 what I am talking about MR. JIAltRY: Do not be so foolish! MR. SIMMONS: - what was ·the Power ec-ission. They change the - every-day, Mr. Speaker. I mean Newfoundland and Labrador Hydro or whatever agency is collecting in those areas formerly served by the Power C-1.ssion, in terms of retail utility. MR. BARR.Y: Mr. Speaker, the honourable member was not very clear.

I as1111111e that the honourable member is referring to those areas of the Prarl.nce that are serYed by diesel generators, where Newfoundland Hydro is supplying electricity directly - MR. SIMMONS: MR. BAIUlY: MR.. SIMMONS: That is what I said. That is not what you said. Tell ae what I said.

June 18, 1975 Tape 2415 (Afternoon) PK - 3 MR. BARRY: Mr. Speaker, the honourable member has raised a point that I will check into,aad I will get the information for him. But I would appreciate if he would be a little more clear when he asks the queetions so that I can know what information he is referring to. I will find out if Newfoundland Hydro is changing their billing procedures, and I will so inform the honourable member. MR, SIMMONS: Maybe a supplementary, I will be as clear as I can, but how many outfits does he have under his wing that collects bills for utility purposes? There is only one.

And I think if he is wide awake at all today he knows what one I aa talking about. HOH. HEMBDS: MR, SPEAKER: MR. SIMMONS: MR. SPEAKER: MR. SIMMONS: MR. SPEAKER: < • MR. JlARRY: MR. SPEAKER: MR. SIMMONS: MR. SPEAKER: MR. SIMMONS: MR, BARRY: MR. SIMMONS: Clh, eh! Order, please! I have a supplementary. Order, please! I have a supplementary. Order, please! That is a foolish question, Sit down: Order, please! That was a c01111Dent. Order, please! The minister is getting smarter every day. sit down. A supplementary. MR.

SPEAKER: The Question Period seems to be getting a little bit out of hand, and maybe the Chair may be a little touchy as well, but - MR. SIMMONS: Bully boy! MR. SPEAKER: I would request the honourable Member for Hermitage to remain silent while the Chair is trying to make a ruling. The honourable Member for 7090

June· rn, 1975 Tape 2416 (afternoon) rn-1 Hermitage was proceeding at some length to get into a long

preamble to a question. Again I would say that the questions,as well as the answers,should be very precise. MR. SIMMONS: A supplementary. Is the minister saying he does not know whether there is going to be a change-over or not? Is that the essence of what I understand from him? MR. BARRY: MR. SIMMONS: MR. SPEAKER: 1-!R. BARRY: MR. SI~NS: MR. SPEAKER: '!R. F. ROWE: ~- STIM'.)NS: What do you want me to do, go over there - The minister does not know whether there is going to be­ Order, please! Do you want an answer to the question? •Ir. Speaker, I understand - Order, please! Wait for the question, boy.

The rules apply to all "Leo". MR. ROWE: What happened? J4R. SIMMONS: Nobody told him yet. Mr. Speaker, a supplementary for the minister. Do I understand from what the minister said in reply to my earlier question that he does not :ret know whether there is to be a change-over from their present billing and collection process to central billing? Does he know whether there is to be that change-over or not? MR. SPEAKER: The honourable ~fnister of Mines and F.nergy. MR. BARRY: ~r. Speaker, I vill attempt to repeat again for the honourable member. MR. SIMMONS: Insane~ Insane! MR.

RARRY: If he wishes I can write it out for him, if he is having a little difficulty understanding. ~'R. Silo!MONS: Answer the question, boy. ~ • SPEAKER: Order, please ! MR. SDIMONS: Oo not be so juvenile. MR. BARRY: ~r. Speaker, as I have pointed out - MR. SPEAKER: Order, please! Order, please! The r:ha:1.r has just sairl and the honourable member to my right indicated that the same rules apply to each side. r.ertainly the Chair must agree Pith r"at stat•ment. The ho,i0ural-lr> '"in1ster nf "'ines ,md

June 18, 1975 Tape 2416 (afternoon) IB-2 Energy is attempting to answer a question. Certainly he has the rtght to be heard in silence as well as IIIE"mbers to my right. MR. BARRY: Mr. Speaker, I will repeat what I said in answer the first time, that I will obtain the information for the honourable member with- respect to any changes in the hilling procedures being implemented by Newfoundland Hydro. Now, if that does not answer his question, then I suggest he rephrase it. 'HR. SIM«>NS: It does now, Mr. Speaker. I tmderstand that the minister does not know. SOME llONOURABLE t-lEMBERS: Oh , oh ! MR.

SPEAKER: Order, please! l'R. BARRY: Mr. Speak.er, the honourable member can make any inferences that he wishes. MR. PECKPORD: That is not a question. MR. SPEAKER: Order, please! The honourable Meni>er for Hermitage was not entitled to rise. He did not ask a question. fie made a statement and thus the honourable Minister of Mines and Energy is not entitled to reply to the statement and not a question made by the Member for Hermitage. The honourable Member for Fogo. CAPT. WINSOR: Mr.

Speaker, may I direct a question to the honourable Minister of Fisheries: Could the minister inform the House if officials of his department have completed the assessment of the storm damage and ice damage caused to fishermen's gear along the Northeast Coast by the storm of May 17, and while he is answer­ ing, if not when does he expect it tote completed? MR. SPEAKER: The honourable ~inister of Fisheries. MR. CROSBIE: Mr. Speaker, I have tried to explain the situation several times and I will try to explain it again.

Until such time as the ice moves off so the fishermen involved can ascertain what gear they have lost or what gear they have not lost, we cannot complete the invest _igation. As soon as the ice moves off and we are able to get an accurate report _and people know what gear they have lost, then 709d

June 18, 1975 Tape 2416 (afternoon) TB-3 we will know what the situation is and we will discuss it with the federal authorities to decide whether there should be some kind of gear replacement programme. If there is a gear replacement pror,ramme, it will have a lot of safeguards attached to it. ~o, that investigation is not complete~. I have the latest updated report which I have not had a chance to read yet. It is here in this file.

As far as the r.overnirent of Canada is concerned there is no reason whatsoever - if they feel a special programme is reouired to assist the Northeast Coast, if they should not do so, they do not have to wait for our invitation. They have constitutional jurisdiction in the fishery. It is very likely that I will be contacting Ottawa in the next several days in that connection. So, that is all I can tell the honourable gentleman at the present time. 'When the ice moves off~wtiich a: hope will be soon now, then we will be able t:o get: an accurate story on what the losses are.

The losses are mostly lobster pots and some salmon nets and some lull1J> fish gear. So, it is impossible to get the full story until the ice is gone. "R. SPEAKEP.: The honourable Member for Fogo. CAPT. WINSOR: A supplementary, ~r. Speaker. Is the investigation continuing right now'? "IR. CROSHIE: Yes. MR. SPEAIG:R: The honourable Member for Bell Island. MR. NEARY: ~r. Speaker, could the Minister of Transportation and Comnnmicatious tell the Bouse how the story got started on Air Canada taking over the regional route? Could the minister clarify any confusion that has gone forward as a result of these rumors?

Would the minister tell us how did this come about? What happened at that meeting bet:ween the minister and Air Canada? MR. SPEAKER: That question could be placed on the Order Paper . MR. NEARY: ¥r. Speaker, Sir, I wonder if the honourable the Premier ; Sir, - this is certainly not a quest10n for t~e Or~er Paper - could the honourable the Premier tell us if there is ,m'1 truth t" 7 08:-J

June 18, 1975, Tape 2417, Page I -- apb the reports that Goose Bay is going to phase out in the next several aonths? Does the government have any emergency plans at all? Does the government have any emergency plans at all that they can :Implement to take care of the 800 people who w:111 be left uneapl.eyed? If - MR.. MURPHY: AsinJ.ne ! MR. REARY: It is not asinine, Sir. MR. SPEAKER: Order, please! MR.. BEARY: The people in Goose Bay are very concerned about this matter. MR. SPEAKER: Order,. please! The honourable the Premier. MR.. ll>OIES: Mr. Speaker, I should like to answer that.

I made a statement in this House a few moments ago, and contrary to your. ruling, Sir, about being .brief, this does take some explanation. And according to the ruling -I said a few moaents ago this government has not yet officially been notified by External Affairs or Washington that this was going to b_e the case. We do not 1lake contingency plans for places that may close down. I know in the previous administration, Hr. Speaker, that may have been necessary because there was always some doubt about every project that vent ahead, but that is not the case now. The fact is, Hr.

Speaker, if it is not true there is no need for it. If it is true, it means the federal government, the Liberal Government in Ottawa has been sitting on this information for many weeks without any concern about this Province of Newfoundland nor the people of Labrador. So I would suggest to our colleague, Sir, that if there is any truth to this Ottawa should be answerable. They w:111 be asked by us and I suggest, Sir, they be asked by the ·Opposition as well. SOME HON. MEMBERS: Hear! Hear! MR. REARY: Hr. Speaker, a supplementary question.

Would the Preirler tell us if - I mean, usually where there is smoke there is fire - that if something does happen at Goose Bay, w:111 the government be setting up a corporation similar to the one that was 7100

June 18, 1975, Tape 2417, Page 2 -- apb set up in Stephenville? MR. ROWE: Harmon. MR. NEARY: When the Americans pulled out of Stephenville and left the Harmon Base, similar to what happened down here at Pleasantville. I mean the government just cannot sit back and wait for this to happen. MR. SPEAKER: Order, please! Order, please! The honourable the Member for Bell Island is proceeding to make a speech. His question is out of order because it is hypothetical. MR. NEARY: Mr. Speaker, you do not have to defend the government, you know, let them defend themselves. MR. SPEAKER.: Order, please! Order, please!

The Chair is not going to sit here and let the honourable the Member for Bell Island or any other member infer that the Chair is being partial. The Chair has ruled that the honourable member's question was hypothetical, and if the member wishes to challenge the Chair's ruling, then, of course, that is his privilege to do so. MR. DOODY: Out! MR. NEARY: AN OON. MEMBER: MR. NEARY: You would like to put me out. No, You cannot sit back and wait for something to happen. I mean, you got to move now. MR. SPEAKER: MR. MOORES: MR. NEARY: MR. SilOONS: MR. SPF.AXER: MR. SIMMONS: MR. SPEAKER: Order, please!

We are going to move. You would need Epsom salts. Ex-lax is the only thing that would get you moving. Order, please! I am waiting for the Speaker to recognize me. The Chair is having difficulty recognizing the honourable the Member for Hermitage, when another honourable member persists in speaking when he has no right to. MR. SIMMONS: That is not my problem, Mr. Speaker. Is Mr. Speaker going to recognize me? SOME HON. MEMBER: Oh, oh! 7 i01

June 18, 197S, Tape 2417, Page 3 -- apb MR. MURPHY: MR.. PE<lCFORD: MR. SDU«>RS: MR. SPEAKER.: Up she comes! Pontificaring! Blindness! Mr. Speaker. The Cbalr, with some reluctance, recognizes the honourable the Member for Hermitage. MR. SIMlmlJS: Did you ever hear the like? Mr. Speaker, I believe that cmaent from the Chair was uncalled for and I believe I deserve an apology. Either I am going to be recognized or not. SOME ll)H. MEMBERS: Oh, on! MR. SPEAKER: Order, please! The Chair recognizes the honourable the Member for Hermitage, if he has a question. MR. ROWE: MR.. NEARY: MR. THOMS: MR.

SIMMONS : That is better. With no strings attached. That is better. Mr. Speaker, a supplementary for the Premier~ Was he aware that the contract between the .American people, the American Government and Ottawa for the lease of Goose Bay expires in June of 1976, in any event? Was he aware of that? MR. SPEAKER: The honourable the Premier. MR.. KIOUS: We are totally aware of that, Mr. Speaker, and that is why the Ministry of External Affairs have been the one responsible, dealing with a foreign government, Washington in this case.

These negotiations for the information of our friend, or our colleague, or the gentleman, or - MR. P. S. THOMS: MR. M>ORES~ MR. THOMS: MR. SIMMONS: MR. MOORES: MR. SIMMJNS: MR. :!l)()RES : MR. SPEAKER: MR. MOORES: The honourable member. - whatever. Yes, well,himself from Hermitage. That is unparliamentary. That is parliamentary. That is okay, yes. That is not unparliamentary.- It is also becoming the Premier. - that would make two of you. Order, please: But, Sir, the fact is these negotiations have been going on for several years as this has come to a head. And of course 7l0L

June 18; 1975, Tape 2417, Page 4 - apb we have been aware that negotiations have been going on, a.nd of course we are aware when two foreign governments are involved - or one foreign government and our own - that it has to be done through External Affairs. But we are also very aware, Mr.

Speaker, that when these negotiations go on and a conclusion, if they have been arrived at - that has been the fact - then we would expect the Government of Canada, which is the government of our country of which we happen to be a Province, would involve the local authorities and local in this case meaning the Pro vi.ncial Government and Municipal Governments, to come up with some solutions. And not wanting to

Julie 18, 1975. Tape 2418 RH - 1 deal with a hypothetical case, Sir, ~hen we know officially we will deal with it, and for the infonnation of the Member for Bell Island, one hell of a lot better than was done on the Island of Bell Island when he was member and when the mines closed. MR. NEARY: Only time will tell that. Only time will tell. MR, SPEAICER.: Order, please! Orders of the Day. PREMIER }l)()RES: What did you do for the people on Bell Island when the mines closed? HR. NEARY: We certainly did quite a bit. Do you want me to - MR. SIMMOBS: Like he solved the 1D1employment problems. MR.

SPEAllR: Order, pl-ease! Order, please! AN HON. MEMBER: That 1s a good question for hi.a, MR. NEAllY: Do you want ae to answer it? MR. SPEAICER.: Order, please! MR. SDMlNS: Like he solved the IDlemployment problem. SOME HON. MEMBERS: Name him, name in. _MR. NEARY: Name the Premier, Sir. MR. SPEAKER: There are three or four members that I would like to name right now and will if they persist :In interrupting. MR. CROSBIE: Orders of the Day. MR. NEARY: No, no, Sir, we are not finished with the question period. MR. SPEAKER: There are two minutes left in the question period,if anybody else has a question.

MR, BEARY: Mr. Speaker, I have a question for the acting Minister of Public Works. Would the Minister tell the House what action his departllent has taken to correct a health hazard that is being created as a result of the deterioration of the sewer line between St. Jolm's Airport and down to Middle Cove. MR. SPEAKER: The honourable Minister of Transportation and Communication. MR. ROUSSl:AU: Mr. Speaker, I would have to take that question as notice. I just have a report that is in my briefcase here. I have the 7104

June 18, 1975. Tape 2418 RH - 2 chief engineer from the Department of Public Works on standby to meet me with it,and on the situation to fill me in. I am sure the honourable Member from Bell Island, the Rouse can accept the fact that these things come along. As an acting minister I am not aware of the background of that but I will be checking it out today. It is a jurisdictional problem.,as I understand it. But I am going to have the officials try and determine just what the problem is today. I understand some improvements have been tried over the past Winter but they have deteriorated again.

So, I will be filled in on the exact position of the situation this afternoon, I hope. MR. NEARY: ~r. Speaker, I have a question for the Minister of Municipal Affairs and Housing, Sir. For the twenty-fifth time, would the minister please tell the House what has happened to the accumulated money in this fund from the disposal of the DOSCO assets and rentals on Bell Island that was supposed to be turned over to the people of Bell Island? What has happened to this fund? MR. SPEAKER: I shall permit the honourable minister to answer the question if he so desires and that will bring an end to the question period. MR.

PECKFORD: Mr. Speaker, we have met with the Wabana Town Council and the Newfoundland and Labrador Housing Corporation and had them present to us various projects that were ongoing,as the honourable member might well know,that would be of benefit not only to the people within the municipal boundaries of the town of Wabana but which would also benefit all the people on the Island of Bell Island, To that end we will be passing the monies over to those projects.

ORDERS OF THE DAY: On motion of the Hon, Minister of Fisheries, a bill, uAn Act To Revise Existing Legislation Respecting The Fishing Indust _ry Advisory Board," read a first time, ordered read a second time on tomorrow. On motion of the Hon. Minister of Finance, a bill, "An Act Respecting The Awarding Of An Increase Of Pensions To Or In Respect

June 18, 1975. Tape 2418 Of Cex-tain Employees Of Tbe C',oven;meot Of New_foundlan4, <'.ertain Teachen;i And Cer~ Kembus Of The Honse Of Assembly," read a first tiae, oi-dered read a se.cond tuie OD t:omon-qv. Rn - 3 MR. CROSBIE: Hr. Speaker, I would like to .ove that we dell!te frmi the Order l"apei: Order number (25) ~ the bill there 111enti~ would ~ the saae bill as is dealt with under notioQ (4) - or, I - ,atty, ailder notion {5). So aotioa (5) will replace Cltder (25).. So• I th:lnk we shou.ld correct the Order P-.,ers so ti.t C)rder (25) comes out. MR.· SPEAm: Is it ·the plnsure of the Rouae. to adopt the 1BOtion! Thoee in favour "aye". those against "nay". ~ied.

June 18, 1975 Tape No. 2419 NM - 1 On motion of the honourable Minister of M1micipal Affairs and _Housing, a bill, "An Act Further To Amend The Co1.111unity Councils Act, 1972," read a first time, ordered read a second time on tomorrow. On motion of the honourable Minister of Municipal Affairs and Housing, a bill, "An Act Further To Amend The Local Government Act, 1972," read a first time, ordered read a second time on tomorrow, Order 28, Bill No. 71. MR. !PEAKER: This bill was in second reading last day and I think the honourable Member for St. Barbe North adjourned the debate.

I recognize the honourable Member for St. Barbe North. MR. ROWE: Mr.

Speaker, now that all the violent turbulence has subsided we can probably return to the peace and tranquility of this, consideration of this useless, worthless and meaningless bill that we have before us, Sir,"An Act To Limit The Financial Responsibility Which May Be Incurred By the Province in Respect Of Newfoundland And Labrador Hydro Without Further Reference To The Legislature;• Now, Sir, yesterday I attepted to make a number of points with continuous interruptions and badgering and snarling and snickering and snorting from the honourable the Minister of Mines and Energy, the Minister of Social Services and a number of others of his colleagues.

MR. MURPHY: If you are speaking on the bill,speak on it, MR. ROWE: There is an example, Mr. Speaker. I hope, Sir, that today, so that I will not leave the wrong impression and I will not be drawn off course that I will not receive these or get these interruptions that I got yesterday.

Now, Sir, I speak because I might have left the wrong impression on one specific thing with respect to this bill and that is that the government or Newfoundland and Labrador Hydro could come in and borrow, and this is at the point when the minister said I was foolish and silly, could borrow in excess of $200 million today, anoth~r ~200 million tomorrow and another $200 million next week, and total up say, do that ten times you are the $2 billion realm. And thl, i:nprcss ion might have been left that this could have been done without reference to the -; . ("\ '• - "J j

June 18, 1975 Tape No. 2419 NH - 2 Legislature. That certainly ·was not the meaning that I meant to place on it, Sir, because · the bill obviously says that the aggregrate of IIIDllies to be raised by way of loan by the corporation is what ve are talking about. But still, Sir, the fact remains that this government, I do not know where the cut off point is, can still borrawn $199,999,999.99 without reference to the Legislature. I suppose in fact according to the bill, actually $200 ml.lion. Is that correct? In excess of $200 ~lion without reference to the Legislature. MR.. K>OBES: Further reference. Ill.

JIONE: Further reference, right. Tbere is a difference and that is the whole problem, Sir. Tbere is a difference. Tbe Cabinet can guarantee or Newfomdland and Labrador Hydro can borrow up to $200 illion without reference to this Legislature and,Sir, that ism excessive 11a1>unt of--ey to borrow without inforaing the people of Newfomidland, Well, Sir, that is not the major problem. Tbe major problem. is that aven when it is brought before the Legislature 7.1.0tJ

• • June 18, 1975 Tape 2420 (afternoon) I!l-1 an eighteen or nineteen man cabinet can soon whip the caucus into shape, and the government with its majority can disclose whatever information they wish to disclose. And it is not the reference to the legislature that we are concerned about. It is the informat1on that we get in this le~islature and the information that can be brought before the people of Newfoundland. That is the important and crucial point. Sir, that is why I call this bill iruch to do about nothing.

This is why I startled my friend from Bell Island when I said I do not know what all the fuss is about. Well, basically I did not know what all the fuss was about concerning nothing, because this bill represents absolutely nothing. Sir, the hill is a sham and 1t is a very feeble attempt on the part of this administration to take the advice of the Leader of the Opposition and the Opposition when we were debating the Hydro Bill, to bring before the Rouse every cent that this government guarantees or the Newfoundland and Labrador Hydro borrows for r.xpenditure.

Sir, our fears have not been dispersed and we do not look at the go-vemment as being receptive and responsive to our appeal to have such information brought before the House. Sir, Newfoundland Hydro can take this money and they can do whatever they wish to with it. They can spend it for anything. Sir, that is what all the fuss is about, our concern for the infonuation, our concern for detailed information on how this money is being spent. Now, Sir, just changing the subject for - not the subject, but the point, the theme for one second.

Sir, this government has taken great credit~and we wish them all the success, for gaining and taking control of and gaining the ownership of our natural resources. Sir, there is nothing more sacred in this or any other Province that has natural resources that to have ownership and control of these natural resources. But, Sir, there can be nothing more damaging nor nothing more devastating than a Rovernment having to foot the bill or to have to borrow in onler t <1 develop thr. natural Tesour ce.s of this Province. TI1is is where nur major c,lncern lies, "7: 11 ;J • ~- u ..

J\Dte 18, 1975 Tape 2420 (afternoon) IB-2 Sir. When the history is written, will this government be painter' as one which took an educate,1 g~mhle that has paid off - J sincere] v hope that that will he the c'lse - or will it be paintecl as a government that moved too quickly without taldnp: all the factors into con,;ideration with respect to the escalating costs on the development of the Lower Churchill.

Sir, I read in the press this morn1ng that I was hinting that the Lower Churchill and the government or the development of the Lower Churchill, the government, I was hinting that the government were in trouble on the Lower Churchill development. Sir, did I dare make the suggestion in this honourable House that the government may be in trouble with respect to development of the Lower Churchill? Sir, does ' this require the conclusions of a genius to even dare suggest that the government may be in trouble on the development of the Lower Churchill? No, Sir.

It requires the common sense that every Newfoundlander has in this Province of Newfo\Dtdland and Labrador. Sir, we understand,and the minister has arlmitted,that the cost for the development of the Lower Churchill has escalated to the order of $2 billion and escalation - MR. SPEAKER (STAGr.): Order, please! "'R. F. ROWE : Or there has not been a moratorium 7110

June 18, 1975 Tape 2421 (Afternoon) PK - 1 placed on escalation. And before this project is completed the total cost of this project will be far in excess of $2 billion. And the Minister of Fisheries, Sir, gets up and says that this is what the Leader of the Opposition is hoping for, hoping for an escalation in costs. Sir, what tripe and what foolishness from the Hon. Minister of Fisheries! That is one reason, Sir, that we have concern. We want information on the Lower Churchill.

We want 110re information by a bill that for every $5 million say that is guaranteed by the govenment or borrowed or spent by Newfoundland and Labrador Hydro comes before this House, and honourable members have an opportunity to ask questions about it. HI.. BilllY: Right on. MR. BICKMAN: Will you call it six o'clock and let us all MR. F. ROWE: The Hon. Minister of Justice will have maple opportunity, Mr. Speaker, to -ke his feeble contribution in this House of Aaselllbly if he can ever drag himself up on his two feet. MR. HICKMAN: I will do that as soon as I can.

But, you know, I am a busy man and have things to do. MR. SPEAICER (STAGG) : Order, please! MR. F. ROWE: The second point, Sir, is that for two and a half years or three years - I do not know how much longer I am going to _be, Mr. Speaker, if the minister is worried. It is his bill. Be can listen to me outside of the House on the speakers if he cannot stand ay face, or he can sit there and take the full works. MR. BARRT: to go on. MR. F. ROWE: I was just wondering how much longer this is going I only have a li.lllit of another twenty or so minutes. so I will not be that long. Mr.

Speaker, why are we concerned, ~by do we have the fuss? Because of the escalating costs of the project. Also, Sir, this government kicked out a capable team of engineers, technologists, technicians and work force, experts in the area of econoaics and engineering, and at this present time, Sir, Newfoundland Hydro are - . ... l t_l.~.

June 18, 1975 Tape 2421 (Afternoon) PK - 2 advertising in our daily nevspapers for engineers and what have you for this Lower Churchill project. There has been no significant l!IIJ)loyment on the Lower Churchill at a tiae, Sir, when our unemployment rate has been the highest in our history. There is no guarantee of customers, Sir. We have been asking . "Where are the customers?'' And again the Hon. Minister of Fisheries gets up in the Rouse and he is saying that the Leader of the Opposition here is praying that there are no customers. Sir, talk about attributing motives to an honourable eaber!

It is aazing that the Hon. Minister of Fisheries was not asked to retract these stateaents. No Newfound­ lander, Sir, is going to get up,or should have the right to get up and suggest that any honourable ember in this House is hoping that the Newfoundland Governent or Newfoundland and Labrador Hydro do not have . the custc.ers . We are praying and hoping that they do have the cust011ers, and we would like to know who and where they are, and when we will have thea . We have no guarantee on when it will be completed. No guarantee, Sir, when it will be c•pleted.

We have no guarantee who will be doing the financing, who will be doing the investing , or who will be doing the borrowing. We will know vho vill be doing the borrowing, but we do not know the extent of the borrowing by this Province or Newfoundland and Labrador Hydro. We have no detailed information. And I sincerely hope that the honourable minister will get up and give this information to the House. Sir, this "Project every week, every month, every year that it is delayed is coating this Province millions and millions of dollars because of escalating costs. HR. NEARY: Rear, hear! MR. F.

ROWE: Millions of dollars, Sir, that in fact could be spent on the building of a transportation tunnel under the Straits of Belle Isle which would be an insignificant cost co11ared to the whole project . But this government says it is not economically feasible to put - it is certainly technically feasible, but it is not economically feasible to put a transportation tunnel under the -; ; 1 ") ' .... .&. L.

June 18, 1975 Tape 2421 (Afternoon) PK - l Straits of Belle Isle along with the cable tunnel,combined, it is not econOlllically feasible they say. Yet they let days ii.ad week and months and years go by with escalating costs which could be used for the building of that tunnel. SOME BON. MEMBERS: Bear, hear! MR. P. ROWE: Sir, another concern that we have is this,

June 18, 1975 Tape 2422 (afternoon) IB-1 wondering why we are worried and the Newfoundland people are worried, Sir, the government have sairl-and if I am incorrect the honourable Minister of !fines and Energy can correct me - the government have sa:I d that two gas turbines will be installed, one in Stephenville and one _in St. John's by the end of 1976 which will add of course to the present generating capacity. Sir, one is led to ask the question or one should ask the question,why then do we need the additional turbines and generators at Bay D'Espoir? ~'by do we need them? Why do we need them?

The honourable Minister of Fisheries, Sir, and the honourable ~inister of Hines and Energy have stated that the customers for the Lower Churchill will be the people of Newfoundland. We have been given the reason for the extra generating capacity at Bay D'Espoir, we have been given as the reason for that that we need to supply electricity to the people of Newfoundland until the Lower Churchill comes on stream. The next logical question,if logic is to prevail. Sir, is will the generators, will Bay D'Espoir lie idle when the Lawer Churchill comes on stream if such is the case?

Two generators, one in Stephenville and one in St. John's. extension of Bay D' F.spoir. the reason being given to supply the customers in Newfoundland. the people of Newfoundland with electricity until the Lower Churchill comes on stream: What then happens to these projects, Sir, when the Lower Churchill comes on stream if we have no guarantee that we have customers other than the people of Newfoundland? Sir, is this the first admission, the first public admission by this administration that the Lower Churchill may never be developed or will certainly be a long time :In developing?

While the minister, while the honourable my learned friend from Burin is taking down his notes he might jus.t as well f!;et them in context, 'M'r. Speaker, because if he jumps up on his two feet trying to take notes in conversation with his colleague there and quotes me out of context he will be hit with more points of order than he cares to deal with. MR. NEARY: Gets up on his hind legs. HR. RICKMAN: What is wrong with taking notes? 'MR. NFARY: Raw is your blood pressure? 7114

June 18, 1975 Tape 2422 (afternoon) IB-2 _MR. F. ROWE: Now, Hr. Speaker, Sir, the fact of the matter is that this administration has gotten its whatnots, I suppose, for the want of a better expression so caught up in the wringer that they wish they were never in the mechanical age in th1s Province recause they are in deep, deep trouble, Sir. Tt is as simple as that. If you take into consideration the situation in llay D'Espoir, what they are planning for Stephenville and what they are plannin~ for St.

John's in the way of generating capacity and you look at the escalating costs, the lack of employment, no guarantees for completioo, no guarantees for financing, advertising for engineers when we have a excellent team that we threw out of the Province, millions of dollars going down the drain every year because of the delay which could be used for the building of the tunnel, the Lloyds River diversion, take all these factors into consideration, Sir, and you will wonder why we want to know more answers when this government asks that they be allowed to build, to borrow or Newfoundland and Labrador Hydro to borrow up to $200 million without further reference to the legislature in the total aggregate.

Sir, do you realize, Sir, that this is more money - this is pernaps significant. Not pe:rhaps significant, it is significant-that the amount of money that we are being asked to allow Newfoundland and Labrador llydro and this government to he responsible for in the way of borrowing or guaranteeing is in excess of the amount of money that this government will be borrowing this year as stated by the Minister of Finance in his budget speech. Is that wrong or right?

June 18, 1975. Tape 2423 RR - 1 MR. BAltR.Y: You are impossible to listen to. MR. ROVE: Ah: I am about as difficult to l,isten to - the honourable minister is about as difficult to listen to as the Minister of Mines and Energy suggests that I am difficult to listen to. MR. SPEAKER (Stagg): Order, please! MR. ROVE: I will stand to be corrected• The honourable Kinister of Hines or the Minister of Justice can get up and stand and correct ae OD that one.

But we are being asked ·to allow Newfoundland and_ 'Labrador Hydro to borrow without reference to this legislature or wf.thout infoniatiOD an aaount of aoney in excess of the -ouat that the llinister of Finance has stated that this Province would be borrowing this year. Sir• the people of Newfoundland will not know ~ther the aoney is being spent by Newfoundland and Labrador Hydro OD the Bay D'Espoir developaent, the Lower Churchill, the Hydro jet, posh offices in Montreal, incentives for customers. Will this money be used for incentives for customers to use the electricity to be developed in the Lover Churchill?

Vell, that is the kind of information ve are asking and it has not been answered or suggested. $200 million is an awful lot of on.ey, Sir. Where are the guidelines? Sir, this governaent bas not levelled with the people. It is a feeble bill, Sir, a very feeble bill to try and disperse the fears and the objections that the Opposition bad with respect to the main bill, Newfoundland and Labrador Hydro Corporation bill, when we said that this ·unl:laited borrowing without reference to the legf.•lature is most unacceptable • And they come in with a bill where ~hev can borrm,, up to $200 million!

They can do that without further reference to the legislature. That is correct, is it not? MR. NEARY: That is right. First they bad unlimited borrowing. MR. ROVE: Unlimited first, now $200 million. MR. NEARY: Unlimited first, now $200 million. 7l1ti

June 18, 1975. Tape 2423 MR. ROVE: $200 million. 'MR. NEARY: That is still a fair amount of money to give this honourable crowd. MR. ROWE: Sir, you signalled to me that I only have a few minutes left. MR. DOODY: Very alert. RH - 2 MR. ROWE: And I have a lot more to sav, Sir. Sir, I think it was Louis Agassiz said that a picture was worth a thousand words, was it? I do not have a picture, Sir. Probahly a little poem, Sir, which is worth about 500 words which I would not have an opportunity to say, Sir.

Since my district has been wiped out as a result of redistribution, I have turned to poetry as a side-line in case I need to supplement my income in future years, Sir. So, I will try to wrap up what I have to say in the form of a stanza, Sir. That is that: This is the government who used to hoast/ That theJ would do their utter most/ Another year has passed in their care/ What new bold steps did they share/ With resronsibility and dear/ Sir, nc;,, it was not the opportlDlity they lacked/ It is simple/ They just failed to act. MR. PECKFORD: Boy, it is all there! Mil.

RC'ME: Refer me to University of London, will _ you? You got that, have you "Alec"? MR. SPEAKER (Stagg): The Member for St. John's North. MR. J • CARTER: Mr. Speaker, there are a couple of points that could perhaps be made. I would like to say at the outset, Mr. Speaker, that I intend to vote for this measure but before I do I would like to make a few points. I do not think we can afford to be dogmatic in any of our predictions about the future.

I keep getting the impression from listening to this debate and reading reports of it in the press that this administration knows more about the future than it does ahout the past. Of course, that is an _., . ~ . . .. • i... .Li

June 18, 1975. Tape 2423 RH - 3 illlpossibi1it;y. I think we have to keep asking ourselves ,mether the p.ower should be br.ought to the Island or whether tbe powel." should be sold in .the ~rtheastern United States,and how much should be brought to the Islantl, hClv much should be sold West; vhether or not this power is for clollestic consumption or \lhether and to what extent -we will be or 'DOt be subsidizing various power huugry industries that are probably eye_ing us right now. There has been some talk about cost escalation and the suggei;tion has been made that the escalation of cost is now under control.

Well. on a peraon111·note I understand that the mini&ter has changed bis per~l residence and 7l.1ti

June 18, 1975 Tape No. 2424 NM - l bought an older house in the city and he is about to embark upon some repairs, so he is going to find out all about cost escalation. If he thinks for one 11011Jent, if anyone thinks for one moment that you can predict what the cost of some construction is going to be, not only this time next year but this time next month, I suggest that that person is very much mistaken. Then there is the point about the tunnel across the Straits, The member for St. Barbe North suggested that a little more money could be spent and vehicles could be ' brought across.

I would like to point out that any tunnel across the Straits in my understanding is going to be extrEmely expensive, a vehicular tunnel (if that is the way you pronounce it) is going to be impossibly expensive and out of the question altogether. MR. NEARY: It would be more expensive if you just put a cable down there and then put a traffic tunnel several years later. MR.

CARTER: The point that I would like to, one other point that could be made of course is that, and this bears upon the cost of the tmmel, and that is that I am info:noed,and I think the minister will agree,that the cost of the transmission line, the total cost of the transmission line is about equal to the cost of the generating station. I believe that is correct. Now I understand that Ottawa is helping with the cost of the generating - excuse me, with the cost of the transmission line on the basis of a fifty-fifty, up to a considerable amount, almost reaching $500 million.

On that very point I do not have any strong criticisms of Confederation but I do have strong criticis111S of the way we view Confederation. It is felt that money from Ottawa is sort of, we should just accept it with whatever strings are attached, in other words, "Do not look a gift horse in the mouth." Well Ottawa is not some strange foreign power. It is us. We are as 11111ch a part of Ottawa as any other part of Canada and just to

June 18, 1975 Tape No. 2424 m-, - 2 embark upon a project because Ottawa will partially or even totnlly fund it is not the final argument. I would hope, I certainly cannot - well, I could but I do not intend to lll3ke such a motion - but I would hope that a permanent Standing CoDD11ittee of this Legislature could be formed within the next year or so to keep us all informed and to look into the Lower Churchill project as it develops. I hope, well certainly any Committee of _this House should be composed of both sides of the House.

We would allow the-honourable Member for Bell Island a very small role in this conm:i.ttee. He could perhaps keep - MR. NEARY: No. We are not allowed on se~sitive committees. MR.. MURPHY: He must be acceptable. MR. CARTER: That is right. That is right. MR. NEARY: Well, who decides whether they are acceptable? SOME HON. MEMBERS: Oh, oh! MR. SPEAKER (STAGG) : Order, please! MR. CARTER: I am enjoying this Mr. Speaker. I do not mind at all. Th;ls is begining to become a bit of a free-for-all. Anyway, I would hope that such a permanent ·committee could be established and I will let it go at that.

But I do think it is a worthwhile suggestion because this Lower Churchill Project, Mr. Speaker, could be one of the most important milestones in the development of this Province and electric power has been likened to white coal. It is power in perpetuity. It is - MR, NEARY: More so now that we have this oil crisis. MR.

CARTER: At an earlier stage in another debate we compared it with the number of barrels of oil and the amount of power that is under consideration is literally quite staggering, and therefore I think we should all be as informed as possible and it is the administration's duty to inform this House, to inform themselves, to inform the public on every step of this very worthwhile and very interesting and very vital development. MR. SPEAKER (STAGG): If the minister speaks now he closes the debate, MR. MURPHY: Do you want me to speak for an hour and a half or so "Leo"? _,. ·-o l .. Lt:.

June 18, 1975 Tape No. 2424 NM - 3 MR. NEARY: Talking about the devil and eternity! MR. BARRY: Mr. Speaker~ we have a number of questions that have arisen out of this debate. I must say that in my opbion the 111Dst pointed and better questions are those that were raised by the Member for St. John's East. But there are one or two questions that came from the other side in the course o·f their diatribe and their atteinpt ,· . 2 1 l • •- i..\.

June 18, 1975 Tape 2425 (Afternoon) PK - 1 to put down vhat they recognize is a great progressive - MR. MURPHY: An imperial concept. MR. BARRY: Not an imperial concept! No more imperial concepts, No more colonial concepts, Mr. S~eaker, but a great Progressive C~nservative accomplishment that will go down in the annals of Newfoundland history, Mr. Speaker - SOME HON. MEMBER: Bear, hear: MR. IWUlY: as one of the 1110st significant and best decisions ever made for this Province, a decision that will affect - SOME HOH. MEMBERS: Oh, ob: MR. SPEADR (STAGG): Order• please: MR. BARRY: - in a beneficial -nner - SOME RON.

MEMBERS: Oh,· oh! MR. SPEAKER: Order, please! MR. BARRY: - the lives of all of us. . MR. NEARY: Sit down,boy~ vhen the Speaker rises • MR. BARRY: It is awfully hard to carry on an ordinary - MR. SPEAKER (STAGG): The minister is closing the debate in the proper -nner, and he bas the right to speak to the principle of the bill. Other honourable aeabers have had a chance to speak and they are not to interrupt. And this has been brought to honourable meabers'attention. One honourable this afternoon has seen fit to interrupt quite a bit.

So I suggest that interruptions be as few and far between as possible, or the Chair will reluctantly enforce s0111e of its residual power. MR. BARRY: Now, Mr. Speaker, I would like to get down to some hard facts and information just to show the degree of distortion that the Opposition has engaged in in discussing this project. If I could just have' a mmient to get my books open here. Mr.

Speaker, I think one of the moat significant points that should be brought out in connection with this project, and ene that may be overlooked when we discuss the new figure that is set out as the cost of the project, namely, $1.8 billion. Fantastic sumsl And I could not 7.t2L

June 18, 1975 Tape 2425 (Afternoon) PK - 2 agree more with the Leader of the Opposition when he says that the $45 million that are heing spent this year is in itself a very large sum, and that we can lose perspective by looking at the $1.8 billion, the $1,800,000,000 that are involved in the total cost of the project, actually $1,842.39 million, we can lose sight of just how much is involved in a million dollars or,as the Member for Bell Island or the Member for St. Barbe North apparently say, a 11.ere $45 aillion. They dismiss that, ttr. Speaker. That is nothing.

It is nothing that this Province, that this government is going to spend ~4~ 11.illion by the end of 1975 on the Gull Island project. MR. P. ROWE: That is mthing; MR. BARRY: That is nothing~ What did the Medical Complex cost over here? What is the total cost of that? MR. NEARY: It will cost about $70 or $80 million by the time it is finished. MR. BARRY: The initial projected coat of that was around $50 million. MR. NEARY: You never did anything to put it there. MR. BARRY: Fifty million. The equivalent - the amount that will be spent this year is the equivalent of a edical complex at the University.

It is approximately twice the amount available for water and sewer facilities. It is more than the cost of meeting the water SUl>Ply needs of the St. John's area. What is that~$30 million,if I remember correctly, was one figure that appears to have been thrown out. MR. PEClt:FORD: Around there. MR. BARRY: And yet we have - the Leader of the Opposition apparently recognizes that this is a significant, a very large expenditure. But we have the Member for Bell Island and the Heinber for St.

Barbe North getting up and talking about this bill as being a sham because there is nothing happening, there is nothing going to happen with respect to the Gull Island project, with respect to the Lower Churchill project. And they attempt, Mr. Speaker, because I spoke of a final project release of late Fall this year- the Hon. Minister of Intergovernmental Affairs

June 18, 1975 Tape 2425 (Aft~cni) PK - 3 and Fiaheriea mentioned Oc,tober 1. There may be soiae flexibility there, but it will be some time between October 1 and January 1 that the final .project release w:111 have to be made in order to meet the

schedule of bringing power on streaa by early 1981. Nov you could pr:,atpone the deci iOD, but by doing so you would also postpone the 7 ; 2· ' .:. "

June 18, 1975 Tape 2426 (afternoon) IB- 1 date of completion. But, ~r. Speaker, I also sai~ and made it quite clear that this Rovemment had approved an initial project release as of June 1, 1975, an initial project release that will see by the en<l of 1975 some $42 million, $43 million spent that will see government engaging in other connnitments during that period that will require further expenditures, and that will see the work being done this year that will be necessary to keep us on

schedule for getting power on stream and the Gull Island project completed by early 1981. The project is started. The Gull Island project is now started. l'fl! . NEARY: Do not be foolish, hoy. !-IF. BARRY: Now, I - the honourable Member for St. Barbe North is agreeing and the honourable Member for Bell Island is apparently disagreeing. MR. NEARY: No. I am not. "MR. BARRY: Is there any unity on the other side of the House? MR. MURFHY: None. MR. BARRY: Is there any consensus? MR. MIJRPHY: The leader is not in, the co-ordinator. MR.

BARRY: When the Leader of the Opposition leaves does it fall apart over there? t,fR. ~llRPHY: Where is the co-ordinator? MR. BARRY: Is there no party discipline left in the Liberal Pa"rty in this Province? ~. NEARY: ~- BARRY: Wait until you are kicked out and we are put back in! We have seen the effect of Mr. Smallwood, the disasterous effect he had on party discipline. But surely - MR. SPEAKER: Order, . please! MR. BJ.J!RY: A little relevant, yes, Mr. - MR. SPEAKER (STACG): I th ink the honour ab le minister kn=s · why I have risen and I do not think I need to go into a lengthly discourse on it. ~- BARRY: vr.

Speaker, okay I will try and keep to cold, hard facts. ''r. ~pea1':er, out of that Sl,l'li2,390,000 estimated as the base cost for thfs-sorry:the total cost for this r:ull 1 slancl prc,ject at t l-ie oresent time,we have the base cost,e xcluc!in r. f'c;cabti n'l

June IIJ, 1975 Tape 2426 (afternoon) TR-2 and interest,of s1,n21,nno,(ln0. We have an amount included for escalation. This is worked out at different rates for different components of the project as anybody who took the trouble to read the initial feasibility study would know,because it is thoroughly explained in this,and this report has been distributed and released. There is an amount calculated for escalation. That figure has had to be changed because of the dramatic and drastic inflation rate that we have experienced all around the world in the last two years since this initial feasibility study was done.

But, escalation, the amount included for escalation in this $1.8 billion is $407 million. The 111110unt included for interest during construction - again we have seen interest rates escalate from seven and a half 1 which was the assumption i'l this booklet as funds that we would obtain from the federal government, eight and a half provincial funds, we have seen the interest rate escalate to now where we have to assume ten and a half and eleven and a half per cent interest rate. Interest rates hav~ gone up three per cent since this feasibility study was completed.

Interest during construction constitutes another $411 million. So, this $1,B42,000,000, over $ROO m.illirn of that, $818 million of that is to cover escalation and to cover interest during construction. The base cost that we now estimate the project to be is $1,023,000,000. So, I think that is a factor that may not have been clearly enough understood before. There is no question, it is a fact that the project has escalated, the cost of thl" project has escalated since the inf tial feasibility study was done.

You will all recall that the initial feasibility study,and this is including interest during construction and escalation, the initial feasibility study had the cost of the Gull Island hydro development as $494 million; the cost of the transmission line, the high voltage direct current system, $4~9 million,and the Churchill Falls intertie at 712ti

June 18, 1975. Tape 2427 RR - 1 $48 million for a total of $1,042,000,000. Today, and this is including the $800 million I just discussed for escalation and interest during construction, today the figures break doYn as the cost of the Gull Island hydro plant, S762 million; the high voltage direct current system and the Gull Island facilities necessary to hook into the transmission system, $974 million; the Churchill Falls inter-tie, $94 million; and the - and this figure I have mentioned before, the 230 k.v. line to Happy Valley-Goose Bay, North West River area- $11 million, for a total of $1,842,000,000.

Now, Mr. Speaker, in addition to changes necessary to take note of the increased rate of inflation, the increased interest rates in the money markets of the 1,10rld, there have been some changes in design. There have been, for example, some decisions made such as with respect to the Straits of Bell Isle crossing where the decision was made to go with the tunnel instead of the submarine cables and that alone,under the initial feasibility study, if I can remember correctly, that alone was a decision that added some $38 million to the cost of the project. That is on the basis of the old feasibility study.

It would be more than that with today's escalation. But we have reached a stage, Mr. Speaker, where we have firmer figures. There has been more detailed design done. There has been more information obtained. And the figures that I am giving to you now are the best figures that we can come up with. Now, when I say that we can come up with, I mean not just government and not just myself as Minister of Mines and Energy, not just the officials of Newfoundland and Labrador Hydro Corporation.

I mean, in addition to this. the people, the companies who have been retained as consultants, as project managers and consultants for this Gull Island project. These companies are the best companies in Canada and probably in the world with respect to the construction nf hydro facilities and high voltage transmission lines. lk only several weeks ago requested and obtained a letter

June 18. 1975. Tape 2427 RH - 2 from the officials. from these companies,and the companies I refer to are Acres Consulting Services Limited, Shawinigan Engineering Company Limited, Montreal Engineering Company Lilllited with respect to the Gull Island dam site,and with respect to the transmission line system., Montreal Engineering, Shawinigan Engineering and Templeton Engineering. Now, Mr. Speaker, we havecrequested certain assurances from these companies and these companies have put their reputations on the line,as they do when they get involved in any project.

They have given us certain assurances with respect to the Gull Island project. If I could just smaarize briefly smiie of the points made in this letter. the teams. and these are the teams set up by these ca.panies in conjuction with Newfoundland Hydro officials in completing m, updated review of this project leading to this new $1.8 billion figure, it says, "The teams reviewed the design aspects, schedules and costs as well as the major risks involved in each of the projects in as much detail as the time available allowed.

The findings of the teas have been reported to us and we would advise you as follows: First, design, the design of the power project is sound and contains little scope on the basis of technical reasons for major changes in size, engineering provisions and costs. The design of the transmission system provides a reliable facility for the transfer of the large block of power involved to the Island as " well as a strong connection West to Churchill Falls.

Now, schedule: "the critical paths through both the power project and the transmission system have virtually no float times.'' In other words, we are working on a tight schedule. '• However, we are satisfied that the schedules are realizeable and that power will be available

June 18, 1975 Tape No. 2428 NM - 1 from the project on January 1, 1981, provided that,first 7 provisional project release is given early in June 1975 and full project release on October 1, 1975 and,secondly,that approvals are given and funds committed expeditiously as requested by Lower Churchill consultants and Teshmont throughout the project to ensure that the project

schedule is Nintained." Third with respect to costs, it says, "In your letter you have asked us to report on whether the cost making up the estillated total cost of $1.8 billion are realistic and whether the definitive cost estimates are likely to differ significantly from these~ and they go on to say about the understanding of the make up of the $1.85 billion as I just read out to you, $975 million for the transmission lineR, S762 a:1.llion for the hydro site and $94 million for the Churchill Falls intertie, the Upper Churchill intertie, and $11 million for the line to Happy Valley.

And they refer to the fact that these estimates include interest during construction to Deceuber 31, 1980 &nd they indicate that · in their opin:1.on the overall accuracy of this estimate - and you have to do this, and the way c0111panies do it, the way anybody in the world who addruses themselves to the question of bow fiTIII these figures are, how reliable these figures are, you have to talk in terms of probabilities, in teI'IIIS of the estimating accuracy.

And they talk about this project, the cost of this project as far as the $1.8 billion are concerned, as ranging anywhere from five per cent less than that to twelve and a half per cent 1111>re than that. In other words the project could cost less than the $1.8 billion referred to, could cost up to five per cent less than that.or it could cost~if the worst happen in the opin:1.on of these gentlemm, it could cost an additional twleve and a half per cent which would be what, approximately $2 billion, $2.1 billion.

We just heard the honourable Leader of the Opposition yesterday set out that.first of all,he did not have enough information, that government had not supplied enough information on this project.and he harangued and complained for a while about that. And then he went on 7l.2~

June 18, 1975 Tape No. 2428 NM - 2 to say however, Mr. Speaker, he cannot accept this figure of $1.8 billion, $2 billion referred to by government or referred to in the feasibility study, he cannot accept those figures, because his information, his information is that the project is going to cost $2.5 billion. MR. ROBERTS: Pretty close. MR. BARRY: That is his information. MR. ROBERTS: Yes. MR. BARRY: Now, Mr. Speaker, how inconsistent can you get?

On the one hand he attacks government smragely for not supplying him with information to enable him to evaluate the project,and on the other hand he purports to put forward that he has got all the information he needs to set out his accurate cost estimate of this project. MR. NEARY: He got them through the back door, perhaps from the C.I.A. MR. BARRY: What nonsense! Yes, I would not be surprised but it was C,I.A. tactics! I am glad that you admit that you have a tendency to engage in C.I.A. tactics. MR. NEARY: You will have to get guards around there. MR. SPEAKER: Order, please! MR. BARRY: Mr.

Speaker, that state111ent by the Leader of the Opposition was irresponsible, It had no other purpose that to attempt to downgrade this project and to attempt to embarrass this government. It was a cheap political shot. It was a figure hauled out of the air by the Leader of the Opposition and thrown out in an attempt to try and cause additional difficulties to this government in commencing with this project, in carrying out this project. It was a mischievous act, a deliberately mischievous act by the Leader of the 7130

June 18, 1975 Tape 2429 (Afternoon) PK - l Opposition in an attempt to scupper the Gull Island project. And it is an indication of our callous, how callous, Mr. Speaker, the Leader of the Opposition and I suggest some of his colleagues can be in trying to satisfy their bottomless pit of ambition, their unquenching thrist for power. They will do anything, Mr. Speaker, they will attack any programe of this government however beneficial it aight be to the people of this Province. They will attempt to do anything, Mr. Speaker, to sabotage projects of this govermnent that might meet with the approval of this Province.

I have to - MR. NEARY: What bUDkt1111: MR. SPEAKER: Order. please! MR. BARRY: - I have to thank the honourable Member for Bell Island before he leaves for the few kind words that he gave me last day, Mr. Speaker. Before he leaves I would like to acknowledge with appreciation a few kind words that he gave, and I - just sorry that he could not prevail upon his Leader and his colleagues to continue in that rreat spirit of statenanship that he exhibited III09entarily yesterday. MR. NEARY: Do not go too hard on me now while I am gone. KR.

BARRY: No,we will forget about the honourable Me.her for Bell Island, oat of sight out of mind. Mr. Speaker, if I could go on briefly and continue reading fr0111 this letter that we have fr011 the consultanting engineers in connection with the Gull Island project. They have given that their best estimate with an accuracy of minus five per cent,plus twelve and a half per cent, that their best esti11Bte is a cost of $1.842 million. Now they say they have arranged for an independent review of the escalation indices that were used to estimate the probable cost of inflation to the project.

And the independent review that was done confirms the indices that were used for escalation in computing this figure. They say with respect to major risks that they are satisfied that all normal risks associated with every large project of this type have been adequately provided for in the

schedule and unit costs, and that those not identified at this time will be taken 7131

June 18, 1975 Tape 2429 (Afternoon) PK - 2 care of by the contingency allowance. In addition to a provision for escalation, Mr. Speaker, this figure of $1.842 million contains a Billi for contingencies to meet unexpected costs that may arise. But they point out the major risks, and these are worth noting, Mr. Speaker, worth noting by all of the people of this Province , the major risk9 which could affect the

schedule and/or costs are the following, (

a) greater escalation of prices or higher interest during construction than ass11111ed. And again, Hr. Speaker, these consultants,as our government is doing,is atteapting to operate with respect to certain as111111ptions as to how world prices are going to go, as to how world interest rates are going to go. We have to do this just like every businessman in this Province has to do this, Mr. Spuker, when he engages in a project, a construction project. He bas to make certain assumptions as to how the economy is going to develop, what the prices are going to be - SOME lllN. MEMBERS: Rear, hear: HR.

BADY: - a few years down the road, what interest rates are going to be. And, Mr. Speaker, there could be unforeseen developments. Let nobody say that this government is attempting to paint a nice security blanket around this project. We are not. This project, like every other project of any magnitude that is c-enced,will be subject to certain risks and one of the major risks will be the possibility of greater escalation of cost or higher interest.

Another major risk that could be involved is any unfavourable movement in the exchange rate of the Canadian dollar, Again this is a factor that can affect the cost of the projects since some of the equipment will have to be purchased outside of the country. Another major risk is the possibility of prolong stikes in the equipment suppliers and/or the transportation system. again areas where we have little or no 7l3i!

June 18, 1975 Tape 2430 (afternoon) JB-1 control. Another possibility where major risk exists is with respect to prolonged strikes or other labour \lllrest on the site itself. Here it is more within our control and hopefully we can work out with the various unions concerned and with Newfoundland Hydro an arrangement that will see this project, this project which is of great importance to this Province, proceed without interruption. We have the model of the Churchill Falls project which was very successful with respect to labour relations.

We are not saying that conditions are the same now as they were then, hut we are say­ ing that we can learn from the way the Upper Churchill project was carried out. Another possibility or area where a major risk could he involve<l is the absence of really competitive bidding 1ff we find that as bidding proceeds on this project that we are not having competitive bidding, that we have companies that are either getting together to set prices or are in a monopolistic situation with respect to supply of materials. And of course we always have the final area of exceptional physical circumstances and acts of C,od.

NOW', Mr. Speaker, all of these items have been considered in determining the feasibility of this project. This was gone over again over the last several months in the review of the initial feasibility study to take light of the changing situation, changing conditions that have occurred in the last year and a half since the first study was done. But if I could just read out for you the conclusion from the

summary of findings and conclusions from this new feasibility study. It says that: " It is the finding of this study that the Gull Island project is technically fersible and financially soun~. From an economic viewpoint the development of the project will utilize a renewable resource at a reasonable and stable cost and is superior to all available alternatives." That, Mr. Speaker, is significant. It is superior to all available alternatives. And if I could - I do not see it here right fn front of men= - but there is another clause that indicates that the Gull Island project is looking better in comparison with the alternatives that we have in this Province,

June lA, 1975 Tape 2430 (a f temonn) IB- 2 nuclel'r, thermal pJ ant, gas turbines or whatever, that the C::ull lsJ artd project is looking hetter tod;a'I' in comparison with those tJ,a:, m1•, otheT alternat1ves. It is loC1ldnp. hetter than it did when the ·initial feasibility study was carried out,because even though the cost of Gull Island has escalated, the cost of these alternatives has escalatE;d more, Mr. Speaker, So tl!at the Gull Island project, this feasibility study indicates,is even more viable in comparison to the alternatives that it was when the initial feasibility study was carried out in 1972.

Now, Mr. Speaker, we have to look at that. We have to look at what our alternatives are. We are talking het:e, t-rr. Speaker, about meeting the needs of our Prgv:(nce not just for one or two or three years. It is anticipated that when this CQmes on stl'~ in 1981 that the needs of our Province will be met Wttil approximately 1989. By 1989 the Province will be taking up all of the power of Gull Island, in a fairly brief period, over an eight year period. I w:Ul go into that in a moment anrl explain. This deals With the need for customers and where the customers are going to c:ome from and so on. Fi.rat, Mr.

Speaker, if I co·uld I would like to jus:t talk al>out the 1975 progranne of work,

summary of work that will be undertaken in respect of the Gull Island project durin~ l975. ' 7 3 J'. I·- ~

June 18, 1975. Tape 2431 RR - l I have already mentioned the provisiO'll81 project release was given on June 1, 1975. This is a statement of intent on the part of the owner that enables all concerned to proceed in the knowledge that the project will go ahead, and it also indicates when the Province must begin getting involved with respect to COl!lllitments for contracts and so on. This project, you have to look at it as having three distinct areas of activity. First, the Churchill Falls-St.

John's transmission systems; secondly, the Strait of Bell Isle Crossing; and third, the Gull Island hydro electric power site - three distinct areas. Nov, with respect to the Churchill Falls to St. John's trans­ mission sy~tem, the 1975 expenditure on this progr-e will amount to $10.41 aillion of which $6.36 aillion is for contracts in the field. The 111.ajor contracts are for transmission line surveys, $2.61 aHlion; tranadssion line clearing, $1.6 aillion; helicopter support, $920,000; fuel supply and distribution, $260,000.

Tbe contracts, and this is the contracts involving the transmission -line, involve a manpower component peaking at 345 in July and above 200 through the aontbs of June to Naveaber. The high labour =-s,onent is in the line survey and clearing contracts vhere skilled wood.en and survey crevs will aake up sixty-five per cent of this requir-t, the rest being aainly engineering and air support services per--1. That is with respect to the transmission line.

Ben: with respect to the Strait of Bella Isle CroBBing, th1.s vork consists of first, the construction camp and the support facilities on either side of the Strait of Belle Isle near Savage Cove and Point Amour; secondly, the driving of a vertical shaft, approximately tventy-e feet in diameter to a depth of 1,800 feet on either side; t:hird, t:he driving of a tunnel appro:idaately seventeen feet: by fourt:een feet:, a dist:ance of twelve miles under the Strait. Nov, this is the total project here, by the -Y• This is not just what is being done this year. I will mention vhat is being done this year in a aoment.

Fourth, the installation of four -; ,, 3·· ' :- ,J

.June 18, 1975. Tape 2431 RB - 2 cables for the total capacity of l,600 megawatts in the tunnel and terrdnating on either side of the Strait. Now, in 1975 the expenditure associated with this vork vill amount to $13.15 million of vhich $8.13 illion is for field con­ tracts, the major ones being, first, shaft, headframes and hoists, $2.93 mllion; secondly, shaft, steel and ropes, $0.67 illion; third, diesel plant, $1.21 million; fourth, trailer camps, $0.17 million; fifth, site services and fuel, $2.52 million; sixth, pre""3X'outing for shafts, $0.60 illion; seven, seismic end drilling, $0.16 million.

Nov, as most of these, the large expenditures here involve the purchase and delivery of materials to the site, the labour component is relatively small through the summer months and does not really show up until September through to December when it will be in excess of 250,peaking in November at 322. Moat of these people will be general labourers, carpenters, electricians, plmbers, etc., who will be involved with setting up the site ca111ps and support facilities along with the drill crews and the engineering support team.

The third area of activity is the Gull Island hydro site and this work constitutes the construction of the dam,power house,spillway, etc. In 1975 the expenditure will ainount to $12.04 million 713ti

June 18, 1975 Tape 2432 (afternoon) IB-1 of which site contracts will account for $4.6 mj]lion. Major contracts are for road improvements to Churchjl] Fa~ls-Goose Bay, $3 million; founrl;,t.ion investigation, $1 million; caterinr, $200,000; camp construction, ~300,000. The manpower requirements peak at 285 in September and October and are above 200 from July through to Novemher. A good part of the work is in the. roarl upgrAding and the usual skills of heavy equipment operators and labourers will be required.

At the site there will he mainly drill crews, engineering services and limited requirements for the building trades to establish camp facilities. SOME HON. "!E~ERS: Hear! Hear! Ml. BARRY: Now, in

summary we are looking at an expenditure totalling from now to the end of the year another $35 million. Some $8 million has been spent up to now. That w:111 mean a total expenditure by the end of the year of a little over $43 million. The manpower requirereents I have already mentioned with respect to each of the components of the project. As we see it at the present time, as of May there should have been 151 employed on the site, by the end of June 387, by the end of July 64B, August 646, September 824, October 868 anrl so on. The recruitment policy, there were some questions raised with respect to this.

In order to prepare for the manpower requirements of the project the Hydro staff haye been geared up and there has been a recruitment officer designated on the staff of Newfoundland Hydro. This nerson has the sole responsibility to co-ordinate,contract or request for manpower with the market. This gentleman is Mr. Henry Janes who is operating from the offices of Gull Island Power Corporation at the nonovans Industrial Park.

This gentleman - I think 1t should be pointed out, that a lot of the employment .is with sub­ contractors, contractors doin~ the work for Newfoundland Hydro and not necessarilv with Newfoundland Hydro directly. Rut Newfoundland Hyrlro will have th1 s individual co-ordinate the manpower requirements. He ,cill also ~'ork throuJ!;h C:anada Manr,ower, dNd directly with Canada ~•anp0wer ,me' there w111 be owners' TP11T€'S€'ntatives established in the - . 3·· t .L {

June lf\, 1<17.5 Tape 2432 (afternoon) Tll- 2 C:oose Bay-Happy Valley are .a a ,nd on either side of the Strait of llelle Isle to accommo~ate the employment of residents from the local area. Now, Mr. f:peaker, I am running out of time here .. I understand. I have a limited time to - ~- PECKFORD: No. tarry on. MR. SPEAK.Ell : The honourahle memher has forty-five minutes,of course, in sliuning up the bill. P.ut not when he is introducl.ng it. except by leave naturally. His time eXJ>ires at five minutes after fjve. MR. BARRY: Pardon? MR. PECICFORD: I thought you had unlimited time. "-It.

BARPY: Just on fntroduct:ion of the bill it is unlimited time 9 I gather. Anyhow, f;rr. Speaker, a lot of these point:s I think I have covered, a lot of the points that have been raised. The trans .it tunnel has been discussed before. The actual cost in the '!'teliminary feasibil;ley study, the cost of enlarging the tunnel to make it large enough to accounodate vehicle or traffic was some-just under S50 million . I call upon every -, •3u ' ~ u

June 18, 1975. Tape 2431 honourable member of the House to support the project. On motion second reading of a bill, "An Act To Limit The Financial Responsibility Which May Be Incurred By The Province RH - 1 In Respect Of Newfoundland And Labrador Hydro Without Further Reference To The Legislature," read a second time, ordered referred to a C0111111ittee of the Whole House on tomorrow. !IR. CROSBIE: Mr. Speaker, I would like to give notice that when the House rises at six o'clock, I will move that the House adjourn until eleven tomorrow morning. MR.

SPEAKER.: It is moved and seconded that when the House does adjourn. it will adjourn until tomorrow, Thursday, at eleven of the clock. Those in favour "aye", those against "nay", carried. On motion second reading of a bill, "An Act To Ratify, Confirm And Adopt A Guarantee Agreement Hade Between RoyMarine Leasing L:lmited And The GoYernment And Fishery Products L:lmited." HR. SPEAKER: The honourable ffl.nister of Fisheries. MR. CROSBIE: Mr.

Speaker, this is a piece of legislation to do,as . the title says, to ratify, confirm and adopt a guarantee agr-ent which vas entered into between RoyKarine Leasing L:lmited and Fishery · Products Limited. There is nothing new in the bill. At the t:lae that the government entered into this arrangement an announceaent vas -de and the bill has to do with the fact that in July, 1973 Fishery Products Limited wanted to acquire three further tr-lers frOll a Norwegian shipyard, to have three further trawlers constructed in a Norwegian shipyard.

The shipyard in question had constructed four stern trawlers for Fishery Products U.ited which they finance t1-­ sevles without assistance and they wanted to have three 110re constructed. But in order to have them constructed they could only do the financing for them if govemaeut assisted. So, government negotiated vith the. and the government eventually agreed that we would aake it possible for them to have these three trawlers constructed by guaranteeing fifty per cent of the amount of the financing. Nov, the trawlers were financed by Roy"4arine Limited, wich is -·3 ,. .i ~

June 18, 1975. Tape 2433 RR - 2 a leasing and finance institution. So, the way the arrangement works was that the three trawlers were built for RoyKarine Leasing.who provided the interim financing and the long term financing. They were built for Fishery Products but transferred,the trawlers, owner­ ships of the tra~•lers was transferred to RoyMarine Leasing who then leases the three trawlers to Fishery Products Limited for sixteen years. So long as Fishery Products L:lmited pays the lease payaents for sixteen years, then at the end of the sixteen years they becoae the owners of the three trawlers.

The gove~t has guaranteed to RoyMarine Leasing the repay­ ment of fifty per cent of the lease payments. The effect of that is, of course, that if for some reason Fishery Products Limited defaulted and did not make all the paYJllents required during the sixteen year period, the Newfoundland Gove1'lllllent would be responsible to see that that fifty per cent, that RoyKarlne Leasing got at least fifty per cent of those payments because they would be guaranteed by the government. So, it is a sis:teen year -financial transaction and the interest rate is eight and three quarter per cent.

The three trawlers in question and the other four trawlers that Fishery Products had constructed them­ selves, had built themselves are now fishing in the Catalina. And they are responsible, of course, for insuring that the fish plant at Catalina operates on an all year round basis because they have these seven trawlers fishing. The three trawlers in which the government in involved in the financing under this agreement, those three trawlers have now all been delivered. The last two were delivered within the last several onths and all three of those trawlers are equipped for Spanish pair trawling.

The last two of them are now involved in Spanish pair trawling for codfish and off the Coast of Newfoundland with Spanish personnel assisting Fishery Products in this experiment to see whether or not that we should adopt, or if our crews and captains l'an catch on to the technique or feel that it is worthwhile to adopt the technique of 7140

June 18, 1975. Tape 2433 RB - 3 Spanish pair trawling which is a method of fishing where two trawlers together fish as a pair, and vhere apparently the Spanish get very large catches of cocl in their fishing efforts. So; that is wha,t the last: two of them are now doing. But all seven of these trawlers• including the last thJ:ee, fish into Catalina. Fishery Products Limited now has a to-tal of twenty-two trawlers. These a.even Norwegian trawlers built: in Norway on the Zaragoza fi.sh into Catalina. Five stern trawlers fish into Trepasaey. -: ~4-1 - ~ .~

June 11, 1975 Tape 2434 (Afternoon) PK - 1 Six stern trawlers fish into Burin. That is a total of nineteen stern trawlers. They also have three side trawlers of which one is fishing and two are not, two of the side trawlers are not fishing, for a total of twenty-two trawlers. Now the arrangement was with Fishery Products at that time when this was discussed with them - hy the way.the price of those trawlers vas a very good price as the honourable gentlemen will see from the bill. The price was 8,300,00(}-odd Norwegian krone.

That price translated into dollars is $1.6 million, an excellent price for a stern trawler. And,of course, they would today be much more expensive than that. The max:lmum liability of the government under this guarantee would be $2. 4 •illion. In other words,if they bad to pay.off the guarantee in year one it would involve the government in the payment of $2.4 llillion.

On the other hand if government was ever called upon to pay off under the guarantee we will have three options; we could take over the lease from Fishery Products ourselTes, and assume the obligations to pay IMB leasing - it was then - or Roymarine all of the lease payaeilas and either fish the ships ourselves or sublease them to other operators to fish. And, of course, you would get payment back from the operators to pay off the lease. That would be one option.

Or if we are ever called on our guarantee we could pay Roymarine a SU111 equal to the calculated value of the vessel at that particular time,whenever that time lllight be, including recapture depreciation and take over the mortgage ourselves. In other words,buy the vessel from them for then value of the vessel, or we could arrange with the leasing company to have the ship sold and if the sale price did not cover what they were owed at that time we would be responsible for fifty per cent of the value of the difference. So under this arrangement it '!o!OUld be very difficult to see, Mr.

Speaker, how government could suffer any loss through its guarantee. Now this was not a policy that would just apply to Fishery Products Limited. We said then and I say now that any fish company "7 j 4, I I ..:.. t:.

June 18, 1975 Tape 2434 (Afternoon) PK - 2 operating in Newfoundland that wants to acquire travlers, and has the necessary licences and needs financial assistance that we are equally prepared to do the saae kind of arrangement vith them., in order words to guarantee fifty per cent of their financing in the same manner as vas done for Fishery Products L:taited. There has not been any other cOllpany to date that has wanted to proceed on that basis, but that is the standing policy which is open to all of them. In addition, Mr.

Speaker, to the three alternatives we have if there ever was any default, which I am sure there would not be, but if there was, we did in checking the -in agreements betveen Fishery Products Limited in the Province,which covers $4.8 :aillion that was advanced soae -ny years ago, and which does not have to repaid until starting in 1980 under an arrangeaent entered into some years ago, in checking that we discovered that the fish plant located at Port au Choix was not covered in the government aortage.

So we said that as a condition of our doing this the fish plant at Port au Choix would have to be covered under our fisst mortgage. And we discovered that three of their trawlers were not covered under government's aortgage, aa,d we said that those tlaree tr-lers rill have to be mortgaged to the government, that is, three trawlers that they then had. So that we also have gotten a aorqage on the Zebnala, Zelury, and the Zaley.

And in addition to that ve waated two govermaent directors appointed to the Board of Fishery Products L:taited, and I think the old agreeaent said one director, and that they .-at hold directors meetings at least every three -.niths during the year. And we wanted it aade clear that all their audited stateaenta of themselves and all their associated companies would be provided to the government upon · request. And these were other point  that ve had thea agreed to in return for our guaranteeing of fifty per cent of these lease payaents. So I think it was a very good arrangement, Hr.

Speaker. lbe price of the trawlers was an e:p:ellent one. The trawlers that fish in Catalina which is now a year around plant. they were the last three 714;;

June 18, 1975 Tape 2434 (Afternoon) of seven built for Fishery Products in Norway of which they paid for the first four from their own financial resources or arranged their own financing. U .. 44 PK - 3

June 18, 1975 Tape ~o. 2435 NH - 1 HR. CROSBIE: We were also able to get more security under the original government mortgage with Fishery Products Limited. And of course the financial terms are good because an interest rate of eight and three­ quarters per cent is certainly a good rate when you consider what rates are today. Our maximum liability is $2.4 million, but if we were ever called to pay we have the securitv of the trawlerA and AO n~ antl so forth as I have explained. Now originally, Mr.

Speaker, this agreement was entered into between RoyMarine, Fishery Products and N.I.D.C., Newfoundland Industrial Development Corporation, a government Crown Corporation, because in order for the transaction to proceed then there has to be an agreement entered into and since the House was not opened we could not adopt the route we are now adopting. But we told them at that time, RoyMarine, that if they wished to have the government replace N.I.D.C. as the guarantor, we would agree to do that and at their request present a bill to the House providing for that.

So the bill that is now before the House is to carry out this transaction where government will make this guarantee and the agreement is attached to the bill as a schedule,and I have no hesitation in recommending it to honourable members, Mr. Speaker. I think it is a very valuable device that we should use again if there are other companies that need assistance in having trawlers built, this is a way that we can do it, and that we should utilize and it has a lot of advantages to us. So I therefore more second reading of the bill. MR. SPEAf'...ER: The honourable Member for Fogo. CAPT. WINSOR: Mr.

Speaker, really I do not see too much wrong with this bill although I must admit the honourable the Leader made it known yesterday that he would like to have a few comments on it and I do not know whether the minister would like to hold it over until the Leader of the Opposition gets back. He is going to be back,I think tomor~ow morning, for tomorrow morning's session. However, there is one thing 1 s~e. Ther ~ is a weakness here. I do not see why the government should depend wholly and solely on the security of the trawlers.

Cannot the r,overnnEnt get security in other assets of that company~ Fishery Product~, it is a known fact that Fishery Products has been operating, as a matter of

June 18, 1975 Tape No. 2435 NM - 2 fact I suppose they are one of the first fresh fish processing plants to opeatate in Newfoundland and they have done a very good job and they have also given a lot of employment. However, they have done very well at the profit end of it too, and I C:o not know at the moment how much they paid back on the original loans. Fishery Products is one company which has gotten a great sum of money from the provincial government, from the previous one and now again from this government.

But if we are to provide the capabilities to catch our quotas then of course I do not see any other way out. The government must step in and assist not on1y Fishery Products but other companies as well to obtain more capilbility in order to get out and let us not be put in the position where we can be accused of not taking our quotas from the Haailton Bank qr on any other bank.

So in that light I think the govern-nt - except for the fact I do not think our security is fira enough because if the fishery should fail, God forbid, and then we are left with three, four trawlers, obsolete maybe by then, what security do the government have? So with the assets such as Fishery Products has then I do not see why the government should not delll8Dd secuity in other forms rather than the draggers themselves. So, Mr.

Speaker, that. is the only point I have at this time except the fact that it is providing a source of continuous employ-nt for the people of the Catalina area and if these trawlers are specifically for that area then of course the only way that that plant can operate is through having trawlers with that capability and with that diversification to enable them to )teep that plant operating most of 7l.4b

June 18, 1975 Tape 2436 (afternoon) IB-1 the year but I cannot see how it can keep it operating for the whole twelve months of the year because as we all know very often that particular part of the Island is going to he blocked with ice anyway from January to February and March. Rut, Mr. Speaker, these are the only po1nts that I have but the Leader of the Opposition did make it known to me yesterday that he would like to speak on the hill and I do not know whether the Minister of Fisher1es would oblige and hold it over until tomorrow morning until the leader arrives back. MR.

SPEAKER: If the honourable minister speaks now he closes the debate. MR. CROSBIE: Mr. Speaker, I did tell the Leader of the Opposition the order we were going to call the bills and he did not object then. Now, of course we have no objection when this goes into Committee stage if he wants to raise questions or ask for any detail. That is, you know, quite in order. We have no hesitation in trying to answer any questions he has. So, just to conclude second reading; Perhaps I did not make myself clear, ~r. Speaker. The security that we would have, of course, is not only these three trawlers.

If the government was called upon to meet any part of this guarantee, Fishery Products would be responsible to us for the part that we had to meet. Our security with Fishery Products is a mortgage on all the plants and equipment and vessels owned by the company. The government has had that security since the previous government entered into an arrangement with them ten or twelve years ago.

And as I explained to the House, of course, we have improved that security,as I said just a few minutes ago, because we discovered that under the original government's first mortgage there was not included the Port au Chaix fish plant. We have now got a mortgage on the Port au Choix fish plant that we did not have before because of this arrangement. So, there is additional security there. We als0 discovered there were three trawlers on which the ,, government di~ not have a mortgage. And we sairl 1 ~11 rtrht, we want th0se tno ;,is a,1dit1onal security. 11 We now have a mortgage on Zebrula i ' 4 , i .L l

June 18, 1975 Taoe 2436 (afternoon) IB-2 Zelury and Zaley. So, you know, the first mortgage that the government already had on Fishery Products assets has been expanded to include the Port au Choix fish plant,worth several millions of dollars, and these trawlers. In acldition t~ that,of course,we would also have the three trawlers that are covered under this arrangement. So there is certainly more than adeouate security.

Now, as far as Fishery Products is concerned, that company has not received any more financial assistance from this government than it has received and it had received when we came into office from the previous adainistration with one exception. There is another loan guarantee bill and you will see in that when we come to it now that there is a guarantee of $2 lllillion working canital loan which has become necessary because of the state of the industry and the strike and so on iJI the last few 11K>nths.

But under the original arrangement with the government of which the honourable gentleman opposite was a member, the original amount of $4.8 million roughly, the interest rate on that loan is very low as you know. It is three and a half per cent. Rut that is fixed and that is set with them. They do not have to pay back anything on principal until commencing in 1980 and that is still the case. So, as part of this deal we have increased the government's security and assets owned by Fishery Products.

We also - of course Fishery Products would be liable to us if we had to pay anything on this and the three vessels are security for the guarantee. I also just wante~ to stress again,~- Speaker, that this is not an arrangement that we are just prepared to do with Fishery Products. We are prepared to do it with any company operating a fish plant in Newfoundlan~ that has a license for trawlers and that needs thern. That is an enterprise that :fs viable and should be assisted or even if it is not viable should be assisted.

Any fish comµany operating in Newfoundland that needs trawlers and should have them can have the same kind of an arrangement if they want to pursue it with us. So, it is not just for Fishery Products but they are the only ones who have taken it up. In fact,in 1973 when we did this we sent out 'l 4'' I•"- U

June 18,