Proceedings of the House of Assembly During the First Session of the Thirty .First General Assembly of Newfoundland 1 957 Volume II PRINTED BY GUARDIAN LIMITED, ST. JOHN'S, NEWFOUNDLAND

Proceedings of the House of Assembly During the First Session ofthe Thirty,First General Assembly of Newfoundland MONDAY, May 20, 1957 The House met at 3:00 of the Clock, in the afternoon, pursuant to adjourn­ ment. Presmting Petitions None. Presenting Report of Standing and Select Committees None. Notices of Motion HON. S. J. HEFFERTON (Minister of Welfare): Mr. Speaker, I give notice I will on tomorrow ask leave to in­ troduce a Bill, "An Act Further to Amend the Water and Sewerage Cor• poration of Greater Comer Brook Act, 1951." HON. DR. J. MCGRATH (Minister of Health): Mr.

Speaker, I give notice I will on tomorrow ask leave to in­ troduce a Bill, "An Act Furt'1er to Amend the Dental Act," I also give notice I will on tomorrow ask leave to introduce a Bill,"

An Act to Author­ ize tJ1e Governm ent of Newfoundland to Enter into an Agreement with the Governmen t of Canada Providing for Contributions By Canada In Respect of Prognmmes Administered By New­ foundland Providing for Hospital In-

726 HOUSE OF ASSEMBLY PROCEEDINGS ing for copies of vouchers-Is that vices in Aid of Diagnosis." HON. E. S. SPENCER (Minister of Finance): Mr. Speaker, I give notice I will on tomorrow ask that the House resolve itself into a Committee of the Whole to consider Rdolutiom foir granting of Supplementary 'inpply to Her Majesty." Notice of Questions None. Answers to Questions MR. HEFFERTON: Mr. Speaker, I was asked a question on May 8th. - State the number of families moved by the Department etc. The answer is thirty-nine and the cost per family for moving in each case was three hundred dollars.

Was any vessel own­ er paid for moving said families?­ The answer is yes. How much money was involved? Eleven thousand seven hundred dollars-three hundred times thirty-nine. Did the Royal Canadian Mounted Police make an investigation relative to the moving of these said families, and if so, will the Depart­ ment table a copy of the Report of the Royal Canadian Mounted Police? Yes. W·e are not prepared to table copies of the report as the report has been handled by the Department of the Attorney General. MR.

BROWNE: I wonder if the Minister could say whether arising out of that report there are likely to be any prosecutions? HON. L. R. CURTIS (Attorney Gen­ eral): I have beeu looking into the matter, Mr. Speaker, and I think there will be. MR. BROWNE: Mr. SpeakPr, there was a question on the Order Paper of April 2nd. addressed to the Minister of Municipal Affairs and Supply ask- surance and Laboratory and Other Ser­ answer ready to be tabled? MR. HEFFERTON: The answer is not quite ready, Mr. Speaker. MR. BROWNE: Mr.

Speaker, I won­ der if the Premier is in a position to tell us when the legislation regarding the Javelin matter is likely to come up? HON. J. R. SMALLWOOD (Prime Minister): Mr. Speaker, Mr. Doyle telephoned me on Friday and he says that on Wednesday, that is the day after tomorrow, he and all of the lawyers on both sides expect to meet in Montreal for a final conference and fly then to St. John's with the fin­ alized agreement, drafls of legislation and everything else ready for presenta­ tion to the Government.

It follows that the Government itself will have to give very careful consideration to anything they present before the Gov­ ernment could bring it before the party and Parliament-But the Gov­ ernment itself, as such, has not con­ sidered the matter yet. We are gen­ erally aware of the nature of it and generally aware of the details but not particularly aware; and we might be considering it for days and days on end before we are ready to bring it before our friends in this House and then finally bring· it before the House. So it almost begins to look though we might be here well into the Sum­ mer.

I hope we won't be, but the public business has to be done what· ever our feelings may be-the work has to be done-We may not feel like being here in the pleasant summer evenings. but if the work is still not done we will have to be here. MR. BROWNE: I wonder if I could ask the Minister of Finance if he is in a position to give further in-

HOUSE OF ASSEMBLY PROCEEDINGS 727 formation about the loan raised in the United States-Can he give us any information whether it has been fin­ alized and who is underwriting it, etc? MR. SPENCER: The answer to that question, Mr. Speaker, will be pro­ vided in the Bu.dget Speech, which we hope to bring clown on Wednes­ day . Orders of the Day Third Reading of Bill, "An Act to Provid e Assistance for Teachers By Way of Loans for Certain Purposes." On motion read a third time, or­ dered passed and title to be as on the Order Paper.

Third Reading of Bill, "An Act Re­ lating to the Newfoundland Teachers' Association." On motion Bill i-ca,d a third time, ordered passed and title to be as on the Order Paper. Third Reading of Bill, "An Act to Confirm to United Towns Electric Company Limited Certain Rights and Powers." On motion Bill read a third time, ordered passed and title to be as on the Ord er Paper. Third Reading of Bill, "A n Act Fur­ ther to Amend the Social Assistance Act, 1954." On motion Bill read a third time, ordered passed and title to be as on the Order Paper.

Third Reading of Bill, "An Act to Amend the Local Government Act, 1956." On motion Bill read a third time, ordered passed and title to be as on the Order Paper. Third Reading of Bill, "An Act Respecting the Expropriation of Lan.d." On motion Bill read a third time, ordered passed and title to be as on the Order Paper. Third Reading of Bill, "An Act to Amend the Penitentiary Act." On motion Bill read a third time, ordered passed and title to be as on the Order Paper.

Third Reading of Bill, "An Act to Amen,d the Bills of Sales Act, 1955." On motion Bill read a third time, ordered passed and title to be as on the Order Paper. Third Reading of Bill, "An Act to Authorize the Issue of a Grant of a Pi ece of Land to Reid Newfoundland Company in Exchange for Part of Reid Lot 97." On motion Bill read a third time, ordered passed and title to be as on the Order Paper. Second Reading of Bill, "An Act Further to Amend the Education (Teachers' Pensions) Act." HON. DR. F. W. ROWE (Minister of Education): Mr.

Speaker, under the present Teachers' ·Pensions Act any teacher returning to the profession af­ ter an absence of some time , a few years, can be reinstated in the Teach­ ers' Pension Fund by making a written application to that effect. He may in other words contract in. That has worked to the detriment of a great many teachers in the past because often a married teacher away for sev­ eral years has come back and has as­ sumed that automatically she would be reinstated in the Pensions Fund; and it is not found out until sometime

728 HOUSE OF ASSEMBLY PROCEEDINGS afterwards, in some cases several years aftel'Wards, that she was not a partici­ pant in the pensions fund-In con­ sequence it is felt that there is a sense of perhaps injustice and if not in­ justice then disappointment and frus­ tration that that period of teaching would not count eventually when the question of his or her pension arose.

This amendment seeks to overcome that by making it automatic that as soon as the teacher return& to the profession that teacher will be includ­ ed in the Teachers' Pension Fund, unless he or she writes to the ·Depa·rt­ ment asking specifically that he or she be excluded.

To make that amendment it has been necessary to make a number of formal and technical changes in sev­ eral parts of the Act-So that this Bill is not really so imposing as it looks-Actually that is the only fact­ ual amendment that is made-I do not think there is any need for me to go into detail at this time about the minor formalities and technical changes that have to be made in var­ ious sections of the Act. MR. BROWNE: Mr. Speaker, if the Minister would explain each sec­ tion I think it would be a great help. DR. ROWE: I would suggest, Mr.

Speaker, that because these are formal and technical changes these points could be best explained in Committee. The one specific amendment that is made is that a teacher upon returning to the profession now will be auto­ matically included in the pension fund

whereas in the past that person was only included if he or she wrote and asked to be included. However no m1urious dictatorship prevails here because that teacher may have him­ self or herself excluded by the simple process of writing in LO the Depart­ ment and asking to be excluded. Now in order to make that amendment to the Act it has been necessary to make a number of formal changes to var­ ious sections of the Act, and these, I would sugges·t, might very well be dealt with in Committee. Mr. Speaker, I move the second read­ ing of this Bill. MR.

BROWNE: I ha.d hoped that the Minister would have gone into an explanation to sort of connect up these various sections, but he thinks the other way is better. I am sure we are all in agreement with the principle he has in mind and have no objection to the second reading now. On motion Bill read a second time, ordered referred to a Committee of the Whole House on tomorrow. Honourable the Minister of Public Welfare asks leave to int-roduce a Bill, "An Act Further to Amend the Old Age Assistance Act." On motion Bill read a first time. DR. ROWE: Mr.

Speaker, we are ready for second reading if you will, with the unanimous consent of the House. MR. SPEAKER: With the unani­ mous consent of the House the Min­ ister would ask that the Rules be relaxed to allow to have this Bill read a second time today. It is agreed by leave- HON. B. J. ABBOTT (Minister of Municipal Affairs and Supply): Mr. Speaker, I think it is generally under­ stood that the Government of New­ foundland made an agreement with the Government of Canada a couple of years ago to provide for the pay­ ment by Canada to Newfoundland, in

HOUSE OF ASSEMBLY PROCEEDINGS 729 accordance with the Old Age Assist­ ance Act. The amount paid, of course was forty dollars per month whereby the Government of Canada paid fifty per cent of that forty dollars per month. About eight weeks ago, I think, the Minister of National Health and Welfare announced on behalf of the Government of Canada that that amount would be increased by six dol­ lars beginning July 1st. In other words on July 1st. the Old Age As­ sistance would be t-he sum of forty ­ six dollars per month.

Now in order for Newfoundland to share in that the Government of New­ foundland to share in it, it is neces­ sary to amend the existing legislation -With that in mind this legislation provides for fifty per cent of forty· six dollars per month or such other amount monthly as may be agreed upon from time to time. MR. BROWNE: Mr. Speaker, I do not think that anybody can object to this except perhaps the Minister of Finance, if he is not sure he has the money to pay it when it comes due. There can be no doubt about it, the value of forty dollars in 1952 was great­ er than it is today .

You cannot get as much for forty dollars today as you could in 1952. I met an old gentle­ man yesterday on Cape Shore, and I am sure the Honoura ·ble Minister of Highways knows him very well. He is from Angles Cove-He told me the price of sugar had gone up now until it is sixteen dollars and eighteen rents a hundred pounds. I think that is the highest price it has been in our life­ time, and fat-back pork is seventy­ four dollars a barrel-The cost of liv­ ing is certainly going up, and I think, Mr.

Speaker, what he said is true­ and it would be our wish rather than see an increase of six dollars an in- crease to some figure that would be more equal to the cost of Jiving, which has gone up during the past few years at quite a high rate. Certainly we can have no objections to this . MR. SMALLWOOD: Mr. Speaker, in 1923 I offered myself as Candidate for election to this House, in the district now represented by my hon­ ourable friend behind me, Bonavista South. I was defeated by a very sub­ stantial vote.

But I made one very close friend in that election in the settlement of Openhall, and he con­ tinued for almost ten years to be my very warm friend. About ten years after I met him he died. The reason that the man became my warm friend was that during my visit to Openhall he talked with me, and being seventy­ five or seventy-six years of age, un­ able to work except to potter about the place, he had no income and was living a very thin kind of life. He asked me if I thought there might be any chance of his getting the old age pension. I do not think he has any relatives so I can tell his name­ It was John Batt.

I told him I did not know but that when I went back to St. John's I would find out and I would see what could be done. I did-I found out-and after a few months I did succeed in getting him put on the old age pension list; and he got seventy dollars a year for the next ten years of his life more or less, until he died-seventy dollars a year.

The day before we entered Confed­ eration there wex:e two thousand nine hundred and ninty-nine, one fewer than three thousand, in all Newfound­ land and Labrador, male and female, who drew the old age pension, and the amount was thirty dollars a quar­ ter for two, for a man and his wife,

730 HOUSE OF ASSEMBLY PROCEEDINGS provided they were seventy-five. To­ day there are six tll'Ousand seven hun­ dred between the ages of sixty-five and seventy who now get forty-six dollars a month each; five hundred and seventy dollars a year; still a small amount but Joe Batt would have con­ sidered it a lot.

Now in addition to the six thousand seven hundred be­ tween the ages of sixty-five and seven­ ty there are a good many thousand more, I do not remember the figure hut I think it is getting up close to ten thousand, who are receiving forty dollars a month each from the Gov­ ernment of Canada, so that there is now a grand total of some sixteen or seventeen thousand persons, male and female, over the age of sixty-five as against three thousand eight years ago -Eight years ago it was three thou­ sand and the total amount paid out was a quarter of a million dollars each year to these three thousand-a quarter of a million a year eight years ago­ today it is something of the order of a quarter of a million a week, where it was a quarter of a million in a year eight years ago-as much in a week as it was in a year just eight years ago.

MR. BROWNE: If it was seventeen thousand at forty dollars a month it would be six hundred and eighty thou­ sand dollars a month. MR. SMALLWOOD: I have not got the figure. I have not got the figure for those seventy· and over who are purely a Federal responsibility­ I have only the figures for these who are both Federal and Provincial that is from sixty-five to seventy-for those from seventy up I have not the figure here, and will not depend entirely on my memory for them-But, Mr.

Speaker, one thing is very-very clear­ if Confederation has ,done nothing else than what it has done for the old people it would justify it.

If it had done nothing else, if there was no such thing as family allowances, if they had been never heard of, if there was no such thing as pensions for the blind, if that had never been heard of, if there were no greatly in­ creased payments for war veterans, if that had never been heard of, if our four thousand forty-five hundred, rail­ roaders had never gotten a cent more than they were always getting; if thirty-five hundred Federal Civil Ser­ vants were not employed in Newfound­ land at substantially increased salar­ ies; if nothing had happened, nothing at all, as a result of Confederation but that one thing, that that sixteen or seventeen thousand of our people now for the first time since Newfoundland began, in all our history, now can go on into old age without the hor­ rible fear that old age used to mean, that alone it seems to me would make Confederation the best thing thaL ever happened to us.

Mr. Speaker, I heartily support the Bill. On motion Bill read a second time, ordered referred to a Committee of the Whole House on tomorrow. Honourable the Minister of P11hHc ·welfare asks leave to in traduce a Bill, "An Act to Amend the Disabled Per­ sons Act, 1954." On motion Bill read a first time, with the unanimous consent of the House ordered read a second time now. MR. ABBOTT: Mr. Speaker, this particular legislation, I think, is gen­ erally understood-The existing legis­ lation known as the "Disabled Persons Act of Canada" is payable here in Newfoundland with the Government of

HOUSE OF ASSEMBLY PROCEEDINGS 731 Canada sharing with the Government of Newfoundland on a similar basis to that of the previous Bill. In this country at the present time we have seven hundred persons receiving dis­ abled persons allowances; and quite re­ cently the Government of Canada an­ nounced the increase from forty-dol­ lars to forty-six dol.Jars monthly to become effective July 1st. This legislation is enabling legis­ lation whereby this Province will be able to, if it sees fit, share in this particular allowance whereby the Gov­ ernment of Canada shares fifty per cent. MR. BROWNE: Mr.

Speaker, we favour the second reading of this Bill-This is the benefits which come to disabled persons, which arose out of a considerable amount of, I will not say agitation but, activity in different provinces of Canada, who sent dele­ gations to Ottawa while I was there and interviewed our party-I remember supporting it on several occasions - The result is that disabled persons through agreement between the Prov­ inces and the Dominion received forty dollars per month, and now it is be­ ing increased to forty-six dollars a month. We welcome the change.

On motion Bill read a second time, ordered referred to a Committee of the Whole House on tomorrow. Honourable the Min[ster of Welfare asks leave to introduce a Bil,l, "An Act Further to Amend the Blind Persons Allowance Act." On motion Bill read a first time, with the unanimous consent of the House, the Bill ordered -read a second time now. MR. ABBOTT: Mr. Speaker, this Bill is similar to that of the Disabled Persons Allowances and the Old Age Assistance whereby the Government of Canada shares with the Government of Newfoundland-Existing legislation provides for forty dollars per month.

The proposed amount is forty-six dol­ lars per month beginning July 1st. This is enab1ing legislation. I may say at the present time we have three hundred and seventy persons receiv­ ing blind allowances-and I hope that this Bill will receive the unanimous consent of the House. MR. BROWNE: Mr. Speaker, there is very lit~le we can say on this. "\Ve are in favour of this and are glad to support -it. On mobion B-ill read a second time, ordered referred to a Committee of the \Vhole House on tomorrow. Motion that the House go into Com­ mittee of the Whole on Bill, "An Act to Amend the Land Development Act," carried.

On motion, Mr. Speaker, left the Chair: MR. BROWNE: Mr. Chairman, I wonder if the Minister would give us a little more information on the mean­ ing of that. HON. W. J. KEOUGH (Mdnister of Mines and Resources): Mr. Chairman, I recall that I said when I introduced the Bill that this Bi.Jl is one recom­ mended by the Legal Depa-rtment of the Attorney General and does restore the Crown's right to purchase land in land development areas which right was taken away in amending the Land Development Act by removing the ex­ propriation provision. MR.

BROWNE: Why put it here -"The Crown may purchase land not being Crown Land- They are not go­ ing to purchase theirr own land?

732 HOUSE OF ASSEMBLY PROCEEDINGS MR.

KEOUGH: I undertook to get an explanation of that-The explan­ ation I have is this: The Lieutenant­ Governor-in-Council has the power un­ less the power is excluded in the Sta­ tute or the money is voted by the Legislature , to purchase land from speoific persons -is somewhat less cer­ tain an inclusion of such power in the Hatutes is the rule rather than the exception , and the Department goes on to quote-Power for the Lieuten­ ant-Governor-in 0Council to acquire rights by purchase lies in the Public Works Act; the Highways Act. the Slum Clearance Act and in the Na­ tional Parks and Provinoial Parks Act -Aparently it is a standard procedure followed by the Department of the Attorney General.

MR . BROWNE: Has it eve1· been done in your time? MR. KEOUGH: Any purchasing of land-no, not in my time, not under LancJ. Devdopment. MR. BROWNE: Do I take it then it means you have the power now to pu,rchase land for land ,development areas that is not Crown Land, and in which land in the agreement with Bo­ waters applies? Why ,is Clause 21 of the Agreement with Bowaters ex­ empted. MR. KEOUGH: The Crown under that Bowaters Act has the right to purchase land set forth in th e sched­ ule of that Act for thi1·ty cents. On motion Clause 2 carried . Motion that this Bill be passed without amendment, carried.

Motion, that the Committee rise and report Bill No . 50 without amendment, carried. Mr. S'peaker resumed the Chair. MR. CLAR.iKE: Mr. Speaker, the Committee of the Whole ha·ve consid - ered a Bill, "An Act to Amend the Land Development Act," and has in­ structed me to report havdng passed same without amendment. On motion report received; Bill or­ dered read a third time on tomorrow.

Honourable the Attorney General asks leave to introduce a Bill, "An Act to Authorize the Government of Newfoundland to Enter into a Tax Rental Agreement with the Govern­ ment of Canada." On motion Bill read a first time; with the unanimous consent of the House Bill ordered read a second Lime now. MR. SPENCER: Mr. Speaker, in intrnJudug this Bill to Authorize the Government of Newfoundland to enter into a tax rental agreement with the Government of Canada I have a few comments to make. The Tax Rental Agreement with the Dominion Gov­ ernment, which we signed under au­ thority of

Chapter 40 of the Revised :Statutes of !Newfoundland in 1952 expired, as the House will know, on the 31st of March, 1957. The posi­ tion which would arise as a result of the expiration of the 1952-57 agree­ ment was considered at the Domin­ ion-Provincial Conference and certain proposals were advanced as substitu­ tion for the then existing arrange­ ment by the Federal Government . These proposals were eventually ac­ cepted by the great authority of the Provincial Governments and were also accepted in principle by this Government.

The Bill now before the House is designed to adopt Gov­ ernment Legislation for the new arrangement. The Bill now before us provides the requisite authority for the Province of Newfoundland to enter into a new

HOUSE OF ASSEMBLY PROCEEDINGS 733 financial arrangement with the Gov­ ernment of Canada with effect from the 1st. of April, 1957, the previous arrangements in this connection hav­ ing expired, as I have already men­ tioned, on the 31st. of March, 1957.

As in the case of the expired agree­ ment, the proposed new agreement provides that this iProvince and the various municipality Governments of the Province will transfer income tax in respect of the period of five years beginning on the 1st. of January 1957 and ending on the 31st. ol December 1961; Corporation income tax and Corporation taxes in respect of the five years commencing January 1st., 1957 and terminating December 31st. 1961 and succession duties in respect of succession or transmission conse­ quent upon or upon property passing upon any death occurring during the period of five years commencing on the first day of April 1957 and ending ' on the 31st. day of March, 1962.

In compensation for this action by the Province, Canada will pay into Provincial funds an annual amount in respect of each of the fiscal years which annual payment will be in re­ spect of any fiscal year (

a) ten per cent of the total amount of tax payable under the Dominion Income Tax Act exclusive of the Old Age Security Tax in respect of individuals resident with­ in the Province and (2) on the in­ comes earned within the Province by individuals not resident in any other Province (

b) Percentage of taxable earnings in the iProvince under the Dominion Income Tax Act by each corporation that maintains a perma­ nent establishment within the Prov­ ince and (

c) fifty per cent of the aver­ age of the total amount of such suc­ cession duties payable under the Do­ minion Succession Duties Act in re­ spect of the Province for the current financial year and the two financial years immediately preceding this one . fo the aggregate, Mr. Speaker, these income taxes, corporation taxes and succession duties are in my subsequent remarks referred to as standard taxes.

The payment to be made by Canada under the new agreement results in considerably lower payments by Can­ ada to the ·Province upon comparison with the annual payment during the five years, ending March 31st .. 19!S7, under the then operating Tax Rental Agreement. The resulting deficiency, however, is more than made up by tax equalization payments which are pay­ able by the Dominion Government in accordance with the provisions of the Federal-Provincial Tax Sharing Ar­ rangement Act, 1946 Statutes of Can­ ada.

These tax equalization payments are not conditional upon a Province entering into a Tax Rental Agree­ m,ent with the Dominion Govern­ ment.

Under the Statute of Canada which I have mentioned, the Federal Minister of Finance will pay to the Province in addition to such payments under the Tax Rental Agreement in respect of any financial year for the period commencing April 1st., 1957 and ending on the 31st day of March, 1962, a tax equalization payment which when added to the standard taxes; that is the amount paid to the Province in accordance with the Pro­ visions of the Tax Rental Agreement, will give to this Province a per capita amount equal to the average per capita yield of the standard taxes in the two provinces having the highest yield from individual taxes, corpor­ ation taxes and succession duties taxes at standard rates.

Mr. Speaker, it is important that the House take cognizance of that matter.

734 HOUSE OF ASSEMBLY PROCEEDINGS MR. BROWNE: Which two Prov­ inces are these? MR. SPENCER: The two having the highest income tax . Mr. Speaker, I move the second reading of this Bill. MR. BROWNE: Mr. Speaker, I would like to move the adjournment of this debate; because this is quite a technical matter, and I think we shou-ld have the opportunity to study this. On motion debate on second read­ ing adjourned. MR. SMALLWOOD: Mr.

Speaker, it appears that we have done all we can do this afternoon , according to the Order Paper, unless we went into Com­ mittee on som e of th ese Bills, some of the less controversial Bill s. On Wednesday th e budget is to be brought down, so we are informed by th e Minister , and I would assume that Lhe usual practice would be followed, that is to say, not to attempt to debate the budget until say , the Monday fol­ lowing. That will give the House sev­ eral days during which to study it. MR. BROWNE: Could we not have it on Thursday? Have the debate com­ mence on Thursday? MR.

SMALLWOOD: The practice of delaying the beginning of the de­ bate is a practi ce that has been adopt­ ed down through th e years, to suit the convenience of the Oppositfon. The members of the Government are usually very familiar with the budget and do not need any time; they are ready at any mom ent to debate their own budget. The Opposition tradi­ tionally asks for time in which to study the budget speech befor e they are ready, as a rule, to debate it.

How­ ever if the Oppo~ition, not just one member, but the Opposition generally, are prepared to go forward on Thurs­ da )' it would put a different com­ plexion altogether on the situation . Now I was about to say this: if by any chance the Jav elin Legislation were ready to be laid befor e the House later this week, even on Friday, that is not to be likel y, then the House will certainly want time during which to study it and digest it before the moment would arrive to commence de­ bating all these facts. So it strikes me th e more quickly we get through what business is before us the better for all concerned.

If we could get the decks cleared and leave the budget and with the budget of course the es­ timates and Javelin Legislation , if it comes before us, leave the decks clear for those two major matters, tJ1en the time would be well spent in the mean­ while cleaning up thes e orders, the less serious matters tha t are on the Order Papers at the pres ent time .

So if my honourable friends opposite wish we could go into Committ ee of the Whole for a couple of hours wh en w e could do a lot of work, then if we have in fact nothing to meet for tomorrow let us adjourn tomorrow-maybe my hon­ ourable friend could put tomorrow to greater use somewhere else- MR. BROWNE: T have an engage­ ment at a quarter to five. MR. SMALLWOOD: The honour­ able and learned gentleman will have to trust us, he will have to learn soon to trust us to put through Bills with­ out the benefit of his guidance- On motion House recessed for ten minutes after which Mr. Speaker re­ sumed the Ch air. MR.

CURTIS: Mr. Speaker, I would move that th e Orders in respect of Bills No. 53, 54 and 55 be now re-

HOUSE OF ASSEMBLY PROCEEDINGS 735 scinded and that the House now go into Committee of the ·whole on these three Bills, and also Bill No. 51. MR. SPEAKER: Is it agreed-it could be done with the unanimous consent of the House-that the order respect­ ing BiL!s No. 53, 54 and 55 be rescind­ ed and that the House now go into Committee on these three Bills, on Bill No. 51. Is it agreed that the Or­ der that they be referred to a Com­ mittee of the Whole House on tomor­ row be rescinded and that they be re­ ferred to a Committee of the ,;vhole House presently? MR. HIGGINS: Agreed.

Motion that the House now go into Committee of the 'Whole on Bills No. 53, 54, 55 and 51, carried. On motion Mr. Speaker left the Chair. A Bill, "An Act Further to Amend the Old Age Assistance Act." Motion, that the Committee report having passed this Bill without amend­ ment, carried. A Bill, "An Act Further to Amend the Disabled Persons Act, 1954." Motion, that the Committee report having passed this Bill without amend­ ment, carried. A Bill, "An Act Further to Amend the Blind Persons Act." Motion, that the Committee rise and report having· passed Bills No. 53, 54, 55 and 51 without amendment, car- 1ied. Mr.

Speaker resumed the Chair . MR. CLARKE: M,r. Speaker, the Committee of the Whole have consid­ ered the matters to them referred and have passed Bills No. 53, 54, 55 and 51 without amendment. On motion report received, Bills or­ dered read a third time on tomorrow. MR. CUR TIS: Mr. Speaker. I move that all remaining Orders of the Day do stand deferred. Carried. MR. SPENCER: Mr. Speaker, with permission of the House I give notice I will on tomorrow move the House into Committee of Supply and also I give notice that on tomorrow, Wed­ nesday, I will move the House into Committee of Ways and Means. MR. CURTIS: Mr.

Speaker, I move that the House at its rising do ad­ journ until tomorrow, Wednesday at 3:00 of the clock. On motion the House adjourned un­ til tomorrow, Wednesday, at 3:00 of the clock. WEDNESDAY, May 22, 1957. The House met at 3:00 of the clock in the afternoon, pursuant to adjourn- Motion, that the Committee report ment. having passed this Bill without amend- Presenting Petitions ment, carried. A Bill, "An Act Further to Amend the Education (Teachers' Pension) Act." Motion, that the Committee report having passed this Bill without amend­ ment, carried. None.

Presenting Reports of Sta.nding and Select Committees MR. CANNING: M,r. Speaker, I beg leave to report the Select Committee on a Bill entit ,led, "An Act to Regulate

736 HOUSE OF ASSEMBLY PROCEEDINGS the Election of Trustees of Lands and Chattels for the Queen's Road Pres­ byterian Church in St. John's," con­ sidered the said Bill and found the Rules of the House in respect of pri­ vate Bills have been complied with. On motion report received-Bill or­ dered referred to a Committee of the Whole House on tomorrow. MR. CANNING: Mr.

Speaker, I beg to report the Select Committee on a Bill entitled, "An Act to Amend the Maritime Hospital Service Association Re-Incorporation Act, 1949" have con­ sidered and found the rules of the House in respect of private Bills have been complied with. On motion report received-Bill or­ dered referred to a Committee of the Whole House on tomorrow. Notices of Motion HON . T.. R. CURTIS (Attorney General) : Mr. Speaker, I give notice I will on tomorrow ask leave to intro • duce a Bill entitled a Bill, "An Act Further to Amend the City of St.

John's Act," I also give notice, on be­ half of my honourable friend, the Min­ ister of Provincial Affairs, I will on tomorrow ask leave to introduce a Bill, "An Act Respecting the Use of the Coat of Arms of Newfoundland." HON. DR. J. McGRATH (Minister of Health): Mr. Speaker, I give notice 1 will on tomorrow ask leave to intro­ duce a Bill, "An Act Further to Amend the Health and Public Welfare Act." Notice of Questions None. Answers to Questions None. Finance moved the House into a Com­ mittee of w ·ays and Means-Motion is I do now leave the Cha-ir. HON. E. S. S1l"ENCER (Minister of Finance): Mr.

Speaker:, in this Com­ mittee of Ways and Means it is my pleasure to begin the Budget Speech for 1957. For the purpose of greater acni1acy I will adhere very closely to the notes which I have before me for this purpose. BUDGET SPEECH, 1957 MR. SPEAKER : This is one year , if there never was one before, in which the bald facts and figures of the Budget are possibly the least interesting feature of it. I shall give these bald facts briefly and immediately, and t-hen pass on to a discussion of one or two of the most crucial matters facing this P,rovince to­ day.

We budgeted a year ago for a total revenue of forty-two and three-quarter million dollars . The actual revenue amounted co fony-four rnllliun, six hundred thousand dollars. This was about one and three-quarter million ,dollars more -revenue than was esti­ mated. On the other hand, we esti­ mated a year ago an expenditure of forty-two million, six hundred thou­ sand dollars. The expenditure turnetl out to be just under forty-four mil­ lion do1lars. This is nearly one and a half million dollars more expendi­ ture than was estimated.

"\Vhen the two figures are compared, actual revenue for the year and actual expenditure for the year, we find a cash surplus of well over half a mil­ lion dollars for the twe>lve months . The actual figure is $661,000. Actually, the result is not quite as MR. SPEAKER: Under Notice of good as this, for included in the rev- Motion the Honourable Minister of enue is an amount of five hundred

HOUSE OF ASSEMBLY PROCEEDINGS 737 thousand dollars overpayment f.rom the Government of Canada under the Tax Rental Agreement. Th-is type of overpayment by the Government of Canada occurred in a number of Pro­ 'Ylinces. Foe example, in the ·case of Prince Edward Island the overpayment by Ottawa amounted to nearly one and one-half million dollars for the year. When this overpayment is deducted we find ourselves with a total nett cash surplus for the year of $161,000. On the capital account side the total expenditure for the year was just over fifteen million dollars.

This was approximately three-quarters of a mil­ lion dollars less expenditure than we estimated a year ago. On the capital account revenue side the income is slightly below two million dollars, and falls about one hundred thousand dol­ lars short of the estimated revenue a year ago. And now, Mr. Speaker, turning to the new year, which commenced on April 1st past. I estimate a total ex­ penditure for the year of $48,874,000. I estimate revenue for the same period of $48,953,000. This will give us a surplus for the year of $79,000.

It will thus be seen that we propose to increase our expenditure this year by a total of approximately five mil­ lion dollars over the actual expendi­ ture of last year. On the other hand, we estimate a total revenue this year of more than four and one-quarter million dollars over and above the revenue for the year just ended.

A very large proportion of this four and one-quarter million dollars will go directly into the pockets of thousands of our people in the form of increased sala,ries for civil servants and for other employees of the Government, as well as for our thousands of teachers and nurses in Newfoundland. Another mil- lion dollars of this increase in expen­ diture will go into the Department of Education. Another very large por­ tion of it will go into the Department of Health .

Under the heading of rev­ enue for the new year the major in­ crease is to be in the Department of Finance under the hea.ding of the nor­ mal Federal payments due as under the Tax Rental Agreement, and also under the heading of taxation. While no increases -in the rates of taxation are contemplated, the existing rates will bring in larger amounts due to the increasing prospm·ity of the Pro­ vince. Thus, I anticipate an increase of about one and one-half million dol­ lars revenue from the Gasoline Tax and the Social Security Assessment, combined . And now, Mr.

Speaker, I should like for a moment to make reference to the two relatively small bond issues which we have only recently nego­ tiated. The House wi-ll recall that author­ ity was given (by the Act. No. 50 of 1956) for the raising of a loan of $14 millions on the credit of the Province. In the financial year I 956-57 no loans were raised under that authority. T ,he Act in question was not invalidated by our decision not to proceed under the borrowing power, a power which we propose to invoke to the full in this year. As a matter of fact we have already made inroads upon that authority.

I have recently returned from the City of New York where negotiations were brought to a successful conclusion for the raising of a loan of $2,000,000 in the United States market by a private placement. This loan carries interest at 5¼% and will be sold to the pri­ vate purchasers at a price of $98.98 U.S. per one hundred U.S. dollars. The

738 HOUSE OF ASSEMBLY PROCEEDINGS term of this loan is fifteen years, non callable for thirteen. Practically at Lhe same Lime we have disposed successfully through a Mont­ real group of brokers of a loan of $4,000,000 Canadian dollars on an eighteen year term, non callable for fifteen years, bearing interest at 5¼% al a price Lo the public of $97. In view of the prevailing interest rates, these are very reasonable trans­ a,ctions. The money costs work out at 5.72% in respect of the Montreal issue and at 5.35% in respect of the New York issue.

Our information is to the effect that a "spread" of ap­ proximately one half of one per cen­ tum is a normal condition governing sales in the U.S. and Canadian mar­ kets. As to the balance, we propose to seek authority of the House for the raising of a further loan of $3 millions in addition to the $14 million for which the authority of this House has already been given. Now, Mr. Speaker, I have covered briefly that portion of the Budget Speech wherein one must of necessity quote some figures and I now propose to refer briefly to more historical fea­ tures.

This Budget Speech, which is the ninth to be brought clown since New­ foundland became a Province of Can­ ada, has one radical difference from the eight Budget Speeches which came before. This present Speech is fur­ ther unique in that the situation which makes it different from those of the preceding years makes it equally dif­ ferent from the Budget Speeches which came before. This present Speech is further unique in that the situation which makes it different from those of the preceding years makes it equaUy different from the Budget Speeches which will follow in the years ahead.

The situation to which I refer is that the first eight yea,rs of Confederation were set up from the very beginning as a special tes·ting period for the new Province. It might be equally correct to call these eight years an experi­ mental period. At the end of these eight years, so the Terms of Union provided, the first great original phase of Confederation would come to an end. An enti-rely new phase of Con­ federation would have its beginning. During the original eight years this Government, and each Finance Min­ ister who brought down a Budget Speech, knew precisely where New­ foundland stood.

The Government and each Minister of Finance knew, in re­ spect of each of those eight years, that Newfoundland was truly experiencing the very birth of Confederation. Each Finance Minister was fully conscious of the fact that his Budget had necessar­ ily to form part of a picture which could last for eight years and no more. Each Finance Minister could bring down his Budget with the full knowl­ edge that he lived and worked within a period that would come to a com­ plete end within the first eight years from the date of Union.

The Minister of Finance who will bring down the Budget one year from now, whether I or one of my Colleagues shal.J have that honour, will bring down his Bud­ get against a background altogether different from the background of the past eight years. I stand between the two eras, the two great phases, of our life as a Province of Canada. I have the benefit that my predecessors did not have of knowing the history of the past eight years. I have the disad­ vantage of not knowing what the next eight years will be. We are all of us

HOUSE OF ASSEMBLY PROCEEDINGS 739 in this Government, and in this House, betwixt and between the two great or­ iginal eras of Newfoundland's Con­ federation with Canada.

My Colleagues and I are profoundly convinced that the Royal Commission recently appointed by the Prime Min­ ister of Canada, which is to commence its hearings next month, must inevit• ably, in all justice and reason, recom • mend to the Government of Canada that the annual amount of financial assistance to be paid to the Govern­ ment of Newfoundland will be vastly increased above what it -is today, and above the highest peak it reached after the date of Union.

We have naturally made it our business to become very familiar indeed with the facts of our case, and our faith in the probability of this recommendation by the Royal Commission is based squarely upon our knowledge of the facts that will be presented to the Royal Commission by this G-Overnment. It is equally clear, however, that I cannot include on the income side of my Budget even as much as one dollar from Ottawa in resp ect of th e recommendations tha1 the Royal Conun ission will make.

It may be presum ed tha-t the Royal Com• mission will fini sh it cnqui.ry, and make its report to the Government of Canada, well before the expiration of the present calendar year . It is even conceivable, if the Parliament of Can­ ada holds an autumn session, that that report will be ready for the considera­ tion of that Parliament. If it is not, it is certainly the case that the report and recommendations of the Royal Commission will be laid before Par· liament in the regular session that will open in January of next year.

From this it follows that within the present financial year, which began on Apr11 1st, less than two months ago, and ex­ pires on March 31st, ten months from now, the Parliament of Canada will give the necessary approval to the re­ commendations of the Royal Commfa• sion. This means, therefore, that with• in this very financial year for which I am now budgeting, there is almost certainly bound to be a very consid• erable sum which the Government of Canada, authorized by the Parliament of Canada, will pay into the Treasury of this Province. I am thus, Mr. Speaker, the most unfortunate of Finance Ministers.

I have the natural desire of all Finance MJnisters to provide for my Colleagues ample funds with which they may build the schools, and hospitals, and roads, and water and sewer systems, and the dozen other vitally necessary services so badly needed in this Pro• vince today. I am confident that a very large sum, amounting to a good many millions of dollars, is ours by right under Term 29. I am confident that this sum wiLI be recommended by the Royal Commission and will be paid to us by the Government of Can• ada.

It would be pleasant indeed to include some of that large sum in my estimate of income for the present fin­ ancial year. It would be pleasant, Mr. Speaker, because this money, if I could include some of that arge sum in my roa,c!s and schools and hospitals and other good things for the people of Newfoundland. It must be obvious to all that I am in no position to include any amount of what must, for another few months, continue to be classified as a purely hypothetical sum of money.

Side by side with our strong con­ viction that Newfoundland's case un• der Term 29 is such as to make inev­ itable this large new annual income to our Treasury is the fact that the financial market in North America t.o-

740 HOUSE OF ASSEMBLY PROCEEDINGS day is less easy and less attractive for borrowing than it has been in a good many years. The Government of Can­ ada, and the Government of the Un­ ited States, acting through their re­ spective financial control bodies (the Bank of Canada and the Federal Re­ serve System) and doubtless acting by mutua.J consent and pre-arrangement, have laid down a firm policy of credit restrictions throughout this Continent.

Through their control over the char• tered and other commercial banks, these two great central financial sys· terms have made quite sure that credit would dry up to an extent which by now has become striking. I shall not attempt to explain to the House the extremely complicated means by which the central financial authorities of the two nations bring about this drastic result. I do not even pretend that I am thoroughly familiar with the deal­ ings of this great financial system.

I know, however, what every newspaper reader knows in North America today: namely, that interest rates have ad­ vanr.erl to whH mie;ht he rnl!Pd out­ rageous levels, and that this credit squeeze policy forms the subject of ex­ tremely violent debate up and down the Continent. Last Year, although the Government possessed the authority of this House to do so, we decided, on the advice of our financial counsellors, not to go on the market with our bonds. The advice we received at that time suggested that the credit squeeze might not last throughout the whole of 1956.

Indeed, thei,e were wide­ spread forecasts that the late autumn of the year would see the beginning of a distinct easing of the credit squeeze. This forecast, and the advice we received, turned out ,to be incorrect by many months. There is a strong or months. I shall not at-tempt to eX,press an opinion on that matter. It is enough at this point to say that al­ though we chose not to go on the mar­ ket with our bonds last year, we did decide to push vigorously ahead with the capital expenditures which were to be financed by the sale of those bonds.

In short, notwithstanding the extremely stringent con,ditiu11 of the money market in North America, we proceeded vigorously with our policy of building roads, schools, hospitals and a host of other badly needed pub­ lic services. This programme, amount­ ing to the customary annual cost of fourteen or fifteen million dollars, we had therefore to finance in other ways. We had on deposit with the Bank of Canada, a total amount of approxi­ mately eleven million dollars. We ar­ ranged with onr Bankers, the Bank of Montreal, for a short-term credit, up to a total of eight million dollars.

As security for this credit we hypothecated an equivalent amount of our cash de­ posit in Ottawa . At the end of the financial year we trumfcrrcd_ thh dgltt million dollars from Ottawa to our account in the Bank of Montreal here. In ,the meanwhile, we withdrew the remaining three million dollars from the cash deposit and this, together with the credit from the Bank of Montreal, gave us a total of eleven mil­ lion dollars toward our capital account expenditures for the season. As .these expenditures reached a total of just over fifteen million dollars, we re­ quired an additional sum of four mil­ lion dollars.

This we arrangoo by the normal course of temporary use of various Government funds to be re­ placed with proceeds of a small bond issue of four million dollars which we placed on the Canadian market in re- suggestion at the present time that the cent days. In the meanwhile, follow­ market will ease in the next few weeb ing our belief that we must sooner or

HOUSE OF ASSEMBLY PROCEEDINGS 741 later make an entry into the United States' financial market, we entered re­ cently for a small issue of two million dollars. These two sums, totalling six million dollars, left in last year's Loan Act an unused balance of eight million dollars which, together with a further sum for which I shall introduce legis­ lation seeking authority in the present session, will enable us to finance our capital account programme in the pres­ ent financial year.

We propose to spend in the present financial year, on such capital account purposes as new road construction, construction of housing, and the like, a total sum of eighteen and a half million dollars. We propose to raise this by means of a bond issue which we plan to market in the current year. This will need to be an amount of approximately fifteen million dollars. The balance will come to us from Ot­ tawa as Trans-Canada Highway and similar capital sum payments.

In view of the condition of the fin­ ancial market of recent months we have had to ask ourselves in the Gov­ ernment just what the prospects might be of floating the necessary bond issue in the current year. As we could not hope to raise enough revenue, over and above what we will need to carry on the ordinary affairs of the Government, by taxation; and as it would not be realistic to budget for any income whatsoever arising out of the recom­ mendations of the Royal Commission; the sale of our bonds becomes the only course open to us.

Acting upon the advice of our financial counsellors we will go into the market at the right moment, if that moment occurs. In that case we shall have ~he funds with which to finance our capital account programme of the present year. If, on the other hand, the present credit squeeze continues to operate at its existing level, and on the advice of our counsellors we do not enter the market, then we shall be obliged to reduce for the present year the scale and number of our capita ,! account projects.

Quite frankly, if that proves to be necessary, we shall make much of the saving this year by reducing greatly the amount of our expenditures on construction of the Trans-Canada Highway. Nor would this 'be so un­ fortunate a result as might appear. Whatever happens, a far longer stretch of the Trans-Canada Highway will be built this year than was ever built hr­ fore in Newfoundland. This is for two reasons. In the first place, ap­ proximately thirty miles of Trans-Can­ ada Highway will be constructed this year through the National Park. This comparatively long

section of the Trans-Canada Highway will cost the Government of Newfoundland nothing at all. The entire construction, in­ cluding the paving, and the subse­ quent maintenance, will be- the sole responsibility of the Government of Canada. In addition to this another seventeen mile stretch of entirely new Trans-Canada Highway will be con­ structed between St. John's and Whit­ bourne under the ninety-ten offer of the Government of Canada. This is Canada's offer to pay us ninety per­ cen tum of the full cost of building some ten percentum of the entire Trans-Canada Highway in the Pro­ vince.

When other phases are added, we will have a grand total of fifty miles of Trans-Canada Highway con­ structed in this present year. I do not guarantee that this fifty miles will be absolutely completed in the present year, and certainly they will not be paved this year. But great efforts will be made by this Government, and by the Government of Canada, to make

742 HOUSE OF ASSEMBLY PROCEEDINGS the maximum progress with the build­ ing of this fifty miles of new roa.d across this island. Whether a contin­ uation of the credit squeeze at its pres­ ent levels will necessi.iate still further reduction in our capital account ex­ penditures in the present year is more than I can say at this moment. We all realize the urgent necessity for a continuation of our capital projects in Newfoundland. We are all vividly con­ scious of the backwardness of our Pro­ vince in this respect, compared with most other Provinces of Canada.

We do not contemplate with any pleasure whatsoever any loss of time or op­ portunity in the building up of the public services of our Province. At the same time, our people must realize clearly that Newfoundland has come to the end of the first gfeat experi­ mental period of Confederation, the period that was set up from the be­ ginning to form the yards ·tick or meas­ uring-rod of the financial assistance which Ottawa is to pay us every year in future.

This being the case, and there being no prospect of our receiv­ ing this greatly increased financial as­ sistance before next winter, we must face squarely the fact that the success­ ful sale of our bonds is the principal means we have this year to finance our capital proj eels. The Newfoundland representatives who negotiated and signed the Terms of Confede.ration in 1948 were able and patriotic men, but they were no more gifted with second sight than any of the rest of us. They could not penetrate the mists that surrounded Newfoundland's future.

Neither they nor any other men could foresee exact­ ly, or even very approximately, the ef­ fect that Confederation would have upon the public finances of the new Province. They could see what any thoughtful and knowledgeable observ- er could see, namely, that great changes would inevitably occur. Where for many years Newfoundland had derived very large proportions of her official revenue from customs duties, now un­ der the new system this revenue would disappear completely. Other well es­ tablished sources of revenue upon which the Government of Newfound­ land had long depended would simil­ arly disappear.

It would be possible, of course, to impose one or two new taxes, such as the Social Security As­ sessment; it would be similarly possible to increase one or two other existing taxes that would continue after Union. How much revenue these things would bring was a matter on which no liv­ ing person then was in a position to make any practical pronouncement. The financial possibilities of the Gov­ ernment of the new Province were in­ deed shrouded in mystery.

Those who would form and administer the first Government of the new Province faced tasks that were truly inspiring in their character, •but not the less dif­ ficult for that fact. These facts were all recognized with great clarity by the Newfoundlanders who negotiated, and their Canadian counterparts of that time. An expe­ dient was resorted to. This was to provide for the Government of the new Province a special annual cash grant from the Federal Treasury. This would assist the new Government to finance its needs for a while. It was called a Transitional Grant and it was put on a diminishing scale.

The theory and the hope were that some­ how or other, as the Transitional Grant diminished, the new Province would replace the grant with revenues of its own. This was little more than a pious hope, for the reality of the situ­ ation was very clearly apprehended, as proved by the fact that Term 29

HOUSE OF ASSEMBLY PROCEEDINGS 743 was written and inserted in the Terms of Union. It was always argued by those who opposed Confederation that the Terms were inadequate. By this it was meant that the Transitional Grant was insufficient, and that for this reason the Government of the new Province would find itself tragically short of the revenue it would need to give the people of Newfoundland the public services they needed so badly. But for the existence of Term 29 this argument would be unassail­ able. There just would be no answer to it.

It would be so sound and so correct that no thoughtful and patrio­ tic Newfoundlander would ever have signed the Terms of Confederation. But Term 29 was written, it was in­ serted in the Terms of Union, and it is at the present time beginning to operate. Mr. Speaker, it is only now that the final Terms of Union of Newfound­ land with Canada are being written . I refer, of ·course, to the financial terms. What could not be written in 1948 will be written in 1957. The Transitional Grant, at least as it has been, will disappear.

A new financial policy, based on the realities of our case, as time has revealed it, will be laid down ·before the present calendar year is over. I find, Mr. Speaker, that there are .~till some otherwise well-informed Newfoundlanders, as surely there must be many of our Mainland country­ men, who do not understand Term 29. This is all the more surprising from the fact that a simple reading of the Term makes the proposal just about as clear as words can do.

It commences with a frank admission of the difficulty (it might as well have said impossibility) of predicting with sufficient accuracy just what the im­ pact of Confederation would be upon the finances of the Government of the new Province. That very admission of inability to make the prediction carried with it the necessity to make provision for the time when the pre­ diction could be made, made accur­ ately, and made upon the basis of ex­ perience and reality. When would that be? Those who negotiated the Terms of Union felt that eight years m ight be long enough to enable the practical experience to be gained.

Eight years was thus fixed as the maximum period within which the Government of Canada would take steps to find out just what financial assistance Newfoundland would need. Steps could be taken after the first, second, third, or fourth year. That would •be largely a matter for the Government of the Province itself to decide. Though advised a year or two after the date of Union to ask the Government of Canada to set up the Royal Commission, the Government of Newfoundland disdained to do so.

The Government felt that the full eight years would be needed if prac­ tical experience and realism were to determine the amount of the financial assistance that must come from Ot­ tawa. It must be apparent to every observer today that the Government were right in this decision. The Gov­ ernment have been equally right in making preparation to present New ­ foundland's case with skill and evid­ ence that would remove all doubts from the minds of the Royal Commis­ sion as to whether the Gov ernm ent of the new Province needed this addi­ tional financial assistance, and how much this assistance should be.

Only a few days ago our own local Com­ mission on Revision of the Financial

744 HOUSE OF ASSEMBLY PROCEEDINGS Terms completed a massive effort that extended over a period of nearly three years during which no effort was spared to gather data and to put it in intellig~ble form for the Royal Commission itself. The task of the Royal Commission, the personnel of which were recently announced by the Prime Minister of Canada, though difficult, is extreme­ ly simple. They have to advise the Government of Canada whether the Newfoundland Government need ad­ ditional financial assistance, and how much they need. A yardstick is spell­ ed out very carefully in Term 29.

The additional financial assistance which they are to recommend for Newfound­ land is financial assistance positively needed to enable the Government of Newfoundland to continue the public service. There is another yardstick.

This is that the additional financial assistance from Ottawa must be such as to enable the Newfoundland Gov­ ernment to continue these public ser­ vices without putting a greater bur­ den of taxation on the Newfoundland people than the burden that has been placed upon the people of the three Maritime Provinces of Nova Scotia, New Brunswick and Prince Edward [sland, taking capacity to pay into ac­ count. The Royal Commission clearly, then, must know what the rates of taxation are in Newfoundland and in the three Maritime Provinces.

They must be able to compare the burden­ someness of these rates of taxation in the four ,Provinces. To measure this burdensomeness of taxation they must know the earning power of the people, and thus the capacity to pay in each of the four Provinoes. This involves not only the earnings of the people in the four Provinces, but the cost of living in each. The essential matter is the capacity to pay taxes for such is the measure of the burden­ someness of the taxation. Mr.

Speaker, honourable Members should bear in mind the fact that the additional financial assistance New­ foundland is to get is for the purpose of enabling the Government to con­ tinue the public services at the levels and standards reached subsequent to Confederation.

Public services in this Province mean primarily roads, schools, hospitals, water and sewer systems, municipal services, rural electrification, public housing, en­ couragement of natural resources dis­ covery and development , and a score of other interests of scarcely less im­ portance to our people. 'We entered Confederation just over eight years lgo with levels and standards of pub­ lic service s tragically lower than the next lowest in all Canada.

I reveal no secret that I am bound to conceal when I say that the Smallwood admin­ istration, very soon after taking of­ fice on the date of Union, faced up to the great implications of Term 29. If the additional financial assistance to come from Ottawa was for the purpose of enabling the Govern­ ment of Newfoundland to continue the levels and standards of the public services, then clearly these levels and standards would have to be raised as rapidly as possible, and on as broad a scale as possible.

Again and again we in this Government were reminded by our Leader, as indeed we reminded ourselves, of our great duty to the peo­ ple of Newfoundland; the duty of having these levels and standards of public service raised to the highest possible point at the moment when the Royal Commission would examine them. The higher the levels and standards, the greater the amount of

1-JOUSE OF ASSEMBLY PROCEEDINGS 745 financial assistance that would be needed from Ottawa. We think that we have done a great work in that direction. When we took office eight years ago the total amount provided, during the last year of the Commission of Government, from the Provincial Treasury for education was $4,100,000; in this present year the amount will be $12,300,000. The total amount for public health and welfare was $7,500,000; this year it is $20,200,00. The total amount for roads was $3½ millions; this year it is $9 millions.

In our first eight years of Confederation we have spent $55½ millions on education; $122 millions on public health and welfare combin­ ed; $63.6 millions on roads and bridges and $6¾ millions on municipal im­ provements. These are large sums, Mr. Speaker, and these totals represent great strides taken to raise the levels and standards of our public services. I have to say, however, that I express the deep regret of all my Colleagues that we have not been able to raise these levels and standards far more than that.

W'e deeply regret that in these matters we still lag a quarter of century in some things, and more than that in others, behind the three neghbouring Mari­ time Provinces of our country.

If Tenn 29 had provided for this review of the financial consequences of Con­ federation to be held within ~ixteen years of the date of Union, rather than the eight years actually provided, then perhaps by the time the review was held we would have succeeded in getting these levels and standards of our public services to much greater heights than we have been able to do. v\Te are bound, however, by the actual verbiage of the Terms of Union. We have spent the surplus funds with which we commenced our career as a Province of Canada. ,-ve have borrow­ ed as many millions of dollars as we felt it was prudent to do.

We have collected revenues from our people in the highest amounts that we felt it was proper to do; indeed, Mr. Speaker, we know that we have perhaps taxed our peopl e more than they should be ex­ pected to pay. All of this we have done in the effort to have the levels and standards of our public services at the highest possible point for the moment when the Royal Commission would review the case and ma-ke their recommendations of how much we will need to continue these levels and standards into the future. And so, Mr. Speaker, Newfoundland faces the future with unwa ·vering hope and confidence in her destiny.

She is part of the great Canadian na­ tion, and she will go up with that nation. Great Canada wanted New­ foundland, and great Canada will treat us now, with justice and generosity . (Applause). MR. SPEAKER: It has been moved and seconded that I do now leave the Chair. HON. M. M. HOLLETT (Leader of the Oppositi'Dn): Mr. Speaker, I do not know if this is the opportune time, but before you leave the Chair, Sir. On motion of Mr. Smallwood the debate adjourned until tomorrow. MR . SPENCER: Mr. Speaker, I have the honour to announce a mes­ sage from the Lieutenant- Governor.

The Honourable The Minister of Finance: I, the Lieutenant-Governor of the Province of Newfoundland, transmit

746 HOUSE OF ASSEMBLY PROCEEDINGS Estimates of sums required for the public service of the ·Province for the year ending the 31st. March, 1958, aggregating Fifty-Eight Million, Three Hundred and Ninety-six Thousand, Five Hundred Dollars ($58,396,500), and, in accordance with the provisions of the British North America Act of 1867, as amended, I recommend the Estimates to the House of Assembly. (S'gd.) LEONAR'D OUTERBRIDGE, Lieutenant-Governor. MR. SPENCER: Mr. Speaker, I move tha,t this message together with the estimates he referred to a Commit­ tee of Supply. MR.

SPEAKER: It is mo1•ed that the M~sage of His Honour, the Lieutenant-Governor, together w,ith the es-timates be referred to a Committee of Supply. Motion is that I do now leave the Chair. Mr. Clarke Chairman of Committee of Supply. MR. SPENCER: Mr. Chairman, I move that the Committee rise, report progress and ask leave to sit again. Motion carried. Mr. Speaker resumed the Chair. MR. CLARKE: Mr. Speaker, the Committee of Supply have considered the matters to them referred and di­ reas m, to report progre.ss and ask leave to sit again. On motion report received, Com­ mittee of Supply ordered sit again on tomorrow.

MR. SM•ALLWOOD: Mr. Speaker, I move that the remaining Orders of the Day do stand dellerred. MR. SP:ENCER: Mr. Speaker, I would like to announce that the mem- bers of the House and their friends and the press and visiting frie:-:ds are invited to the adoining chamber where the usual gathering takes place and where refreshments are ready for those who would care to attend. MR. SMkLLWOOD: Mr. Speaker, I move the House at its rising do ad­ journ until tommrow, Thursday, at 3:00 of the Clock. THURSDAY, May 23, 1957. The House met at 3:00 of the clock, in the afternoon, pursuant to ad­ journment.

Presenting Petitions HON. DR. F. W. ROWE (Minister of Education): Mr. Speaker, I beg to ask leave to present a petition from the residents of Westport and the two small adjoining settlements. This petition prays for the construction of a road from the main road running from the Trans-Canada Highway to Baie Verte, a spur road which will probably be ten or eleven miles long, to run out to Westport. It gives me much pleasure, Mr.

Speaker, to support this petition be­ cause as it happens in my programme I submitted to the Honourabl e the Premier for the district that was one of the projects for which I asked consideration. vVeslport is the largest settlemen L between Hampton and Seal Cove, on that side of White Bay. Indeed in view of the location holds the most promise, in my view. In the arrange­ ment we have made with my hon­ ourable colleague, in Mines and Re­ sources, one of the areas to which I have directed the Department's atten­ tion is Westport. In Westport there

HOUSE OF ASSEMBLY PROCEEDINGS 747 appears to be a very considerable stretch of what appears to be good agricultural land, and there is also ample room for further settlement, and it is my view a number of people in the smaller places will find their way into Westport, and once it is link­ ed up to the Trans-Canada Highway it will have easy access to logging enter­ p rises conducted by Bowater and any mining operations in the area , and ample opportunity to grow produce and to build up a good settlement. I beg leave to table this petition, Mr.

Speaker, and ask that it be refer­ red to the Department to which it relates. On motion petition received for reference to the Department concern­ ed. P1·csenting Reports of Standing and Select Committees HON. G. J. POWER (Minister of Highways): Mr. Speaker, I would like to make a Ministerial Statement: The Department of Highways has been considering the rates being paid to men who work with that Depart­ ment on roads, and it appears that we are paying a lower rate by far than for men who work in similar classifi­ cations who work on bases or with the pap·er companies or with contrac­ tors.

So that the proposal is to raise the rates of wages for these men who work on the road to the equivalent of that paid by contractors and by the other large employers of labour. We also propose to reduce the num­ ber of working hours from ten to either nine or eight, which ever ap ­ pears to be most feasible. I thought that the House might be interested to hear this. HON . M. M. HOLLETT (Leader of the Opposition): I wonder, Mr. Speaker , if I might ask the Honour­ able Minister of Highways how much they will •be paid per hour? MR. POWER: Well, the thing is not worked out definitely yet.

There may be a little variation, but in the matter of common labour I think the rate now is seventy-five cents; so if you take that rate for ten hours and work it out for eight hours and then give a ten per cent increace it may be slightly more than a dollar an hour. Notices of Motion None. MR. POWER: Mr. Speaker, I give notice I will on tomorrow introduce a Bill, "An Act Further to Amend the Highway Traffic Act." Answers to Questions None. MR. BROWN£: Mr. Speaker, I do not see the Minister of Municipal Af­ fairs and Supply here.

I have been promised an answer since some time in April to a question asked that Min­ ister. Orders of the Day MR. BROWNE: Mr. Speaker, I also have a question addressed, I be­ lieve, to the Minister of Welfare. He is not here . In his absence I would like to address it to the Honourable the Premier . I have here before me a Jetter I received today from a resid, ent of Admiral's Cove, Cape Broyle, who I know used to live in Freshwater near Cappahayden, who moved down to this place but did not receive the assistance given to other people. Would they be eligible to receive that assistance now?

748 HOUSE OF ASSEMBLY PROCEEDINGS HON. J. R. SMALLWOOD (Prime Minister): Mr. Speaker, with the in­ dulgence of Your Honour and the House; I am very glad the Honour­ able and learned gentleman has men­ tioned that matter because it gives me an opportunity to offer a brief word of explanation. Ever since New­ foundland began men have moved their homes from one side of a har­ bour to the other side or from the southside entrance of the harbour to the inner part of the harbour or from one harbour to another harbour or from an island to the Mainland.

That sort of thing has gone on for whole centuries and will no doubt continue to go on for a great many years. No Government ever gave any financial assistance whatsoever in such cases, and it is doubtful if any Government ever will give such assistance, where individual men or individual families decide to move, either to move their houses from one part of the harbour to another or from one harbour to an­ ther. In such cases no Government ever did help. What we have for some years past is a completely differ­ ent scheme.

First the people in a settlement must decide for themselves in a public meeting, unanimously, that they wish to move out of that settlement to another settlement or to a number of other settlements.

Hav­ ing so met publicly and having so de­ cided unanimously they then approach the Government and inform the Gov­ ernment of their decision and ask the Government if they will assist in that case-but only in that case where it has ,been a voluntary decision and a unanimous one held at a public meet­ ing and where the Government ap­ proves the place or places to which they propose to move, then and only then the Government will assist them in the actual physical moving of their homes. It varies from place to place but the maximum is four hund­ red dollars.

Now we get occasionally cases of men who hearing in a vague kind of a way about this programme, hearing in the vaguest kind of a way that the Government is helping people who move, and then having gone ahead themselves in the ordinary course, as for centuries past, and moved, having done it, they then, hearing about it, ask the Government if they are going to help, and the Government has to say no. The Government will help only where the conditions I have just des­ cribed have been met.

Now whether four hundred dollars is enough for a family has become doubtful, and I have heard a figure advocated here as much as a thousand dollars per fam­ ily. That matter is under careful consideration. Professor Goundrey our Provincial Economist is specializing on it and we are hoping that within the next year we will have a far more ambitious plan that would enable us to assist many, many hundreds of families to move from the less promis­ ing places into more promising places.

So that my honourable and learned friend will have to tell his friend in Admiral's Cove that the Government cannot help him in his individual case any more than the Government for decades, for centuries, have helped the many individuals who moved their houses. It has got to be part of a community plan before we help . MR. BROWNE: Well, may I ask the Premier one question arising out of that? What effect would it have, might I ask, if I say these people con­ cerned two families, were one hundred per cent of the population. MR. SMALLWOOD: Well if a hun­ dred per cent of that settlement told

HOUSE OF ASSEMBLY PROCEEDINGS 749 us they desired to move we would have been very willing to assist them up to four hundred dollars per family; but the House will appreciate that it would •be madness for the Government to assist to reduce, not eliminate, but to reduce the populations of a small place. If you have twenty families in a place and ten or fifteen leave and five are left the last state is worse than the first. Either all must move -it must be unanimous-or we won't help at all. MR. BROWNE: How long is this in effect? MR. SMALLWOOD: Three or four years. MR. BROWNE: They were elig­ ible at the time. HON.

M. P. MU~RAY (Minister of Provincial Affairs): They had no pub­ lic meeting. M•R . BROWNE: Mr. Speaker, I am not sure all the people were aware of this. It could have been a simple matter for them to get in touch with their member, and I am sure he would be glad to assist in a case like that, where ignorance of procedure existed and I think some consideration should be given. I may say in my opinion a great majority of the peo­ ple today do not know of its existence. MR.

SMALLWOOD: I will make a bargain with the honourable and learned gentleman if the honourable and learned member of the district makes a personal investigation and re­ commends it so that it won't become an issue in this Federal Election I think we would then perhaps give the matter careful and sympathetic consid­ eration. MR. BROWNE: I accept that. Mr. Speaker, now that the Honourable Minister of Municipal Affairs and Supply is present could he tell me if he has the answer to a question I asked him some time in April? HON. B. J. ABBOTT (Minister of Municipal Affairs and Supply): Mr.

Speaker, in reply to the honourable and learned member, my staff has been working on it but it is almost an impossible task. But I would suggest that he visit the Department of Sup­ ply and see for himself the vouchers. We give you that concession. MR. BROWNE: Well, I Tegret, Mr. Speaker, the Minister did not impart that information to me previously. I was depending on the fact that he was preparing the answer. If he had g·iven that information to me previ­ ously I would have had the opportun­ ity to go down. I do not know if I have an opportunity now. MR.

ABBOTT: It is quite true my staff, with additional work coming up find it impossible, and I now release that information for the hon­ ourable and learned member. MR. HOLLETT: May I ask, Mr. Speaker, if that invitation to wait upon the officials extends to me also? I ask­ eel the first question in that particular instance, I remember, and I was wait­ ing to get the reply through the sec­ ond question asked by my learned friend-so, if the invitation extends to me to visit the department? MR. SMALLWOOD: Yes-but the Honourable Leader of the Opposition is not a Candidate, MR.

BROWNE: Mr, Speaker, I presume the Minister means if either or any of us here go or want to go to see that we may? MR. ABBOTT: That is correct. That will be, I may say, under the

750 HOUSE OF ASSEMBLY PROCEEDINGS supervision of the officials of my De­ partment. MR. BROWNE: Yes, we won't take anything-we may photograph some­ thing though. Orders of the Day Third Reading of Bill, "An Act to Amend the Land Development Act." On motion Bill read a third time, ordered passed and title to be as on the Order Paper. Third reading of Bill, "An Act to Amend the Education (Teachers' Pen­ sion Act." On motion Bill read a third time, ordered passed and title to be as on the Order Paper. MR. BROWNE: Mr.

Speaker, on a point of Order-we fell into a bad habit in connection with this Bill and the next three Bills and Number 11 on the Order Paper by not having them introduced in the form of resolutions. I should like to jlliit go on record as pointing out that these are Money Bills, and that they should have been brought in in the form of Resolutions so that the House might have consid­ ered them in Committee before re­ commending the Bills. MR. HOLLETT: Mr.

Speaker, I wonder if I could ask a question rela­ tive to teachers' pensions-I may be out of order, but I would like to put across to the other side of the House that my information is that no in­ crease has been made relative to retir­ ed teachers. I was wondering if the Government has that matter under consideration, and if the Honourable Minister could make a statement to that effect? MR. SPEAKER: I believe that mat­ ter could be taken up when the esti­ mates are under consideration; unless the Minister does wish to say some­ thing now. DR. ROWE: Mr.

Speaker, I think I would like to have notice of that question. MR. S•PEAKER: That point could be covered un~ the appropriate heading of the estimates. Third Reading of a Bill, "An Act Further to Amend the Old Age As­ sistance Act." On motion Bill read a third time, ordered passed and ti tie to be as on the Order Paper. Third Reading of a Bill, "An Act Further to Amend the Disabled Per­ sons Allowance Act, 1954." On motion Bill read a third time, ordered passed and title to be as on the Order Paper.

Third Reading of a Bill, "An Act Further to Amend the Blind Persons Allowance Act." On motion Bill read a third time, ordered passed and title to be as on !he Order Paper. Committee of Supply MR. BROWNE: Mr. S'peaker, is this the Committee for temporary sup­ ply for 1957? HON. L. R. CURTIS (Attorney General): What I propnsf', Mr. Chair­ man, is that there is an order on the Order Paper-Committee of Supply­ In connection with that Order there is on record a letter from His Honour the Lieutenant-Governor asking for so much money, which is sufficient to cover the whole year's supply. My

HOUSE OF ASSEMBLY PROCEEDINGS 751 proposal this afternoon is we go into Committee of Supply for the purpose of increasing the amount of interim supply which we voted earlier in the session. Some of the Departments need some money; and I was just going to ask the Committee to deal with that one item and not start the estimates. MR. BROWNE: Mr. Speaker, might I ask if the Leader of the House or the Premier would indicate whether we are to go on with the budget debate this afternoon? MR. SMALLWOOD: No. MR. BROWNE: Mr. Speaker, in that case, before this motion is passed I would like to make some observa­ tion.

I was under the impression thaL we were going to be given an oppor­ tunity to discuss the budget debate, the last opportunity that I will have. I believe the House will not be open tomorrow, do I take it- MR. SMALLWOOD: That is cor­ rect. MR. BROWNE: This is the last opportunity I will have to speak on the budget, and I regret very much that this debate is not being proceed­ ed with. I had intimated to the Pre­ mier that I would have liked to speak on this.

He did promise in the first place to move the adjournment of the debate until Monday, and yesterday the motion was adjourned-it could have been adjourned on our motion. The Premier adjourned it himself. It seems to me that we should be given that opportunity-and r came here today hoping that I might be able to make some remarks on that subject. If that is not the case, Mr.

Speaker, I would like to make some general ob­ servations in regard to the manner in which the accounts and estimates are considered in this House: that these two, the public accounts and the esti­ mates, dovetail together. w·e get the public accounts for the previous year and then we get the estimates for the future year.

It seems to me that members of the House should be more familiar with the matters which are contained in both these documents we have here, the Public Accounts which contain two hundred and fifty pages of information regarding the public affairs of this country, detailed ex­ penditure-and here are the estimates of one hundred and thirty pages-I have been in this House four years now and I challenge any one on either side of the House to say that the financial affairs of this country are being properly considered. The Pub ­ lic Accounts are tabled but I wonder how many people in the House are familiar with them.

I wonder how many people for example, on the other side of the House realize that ll'e get an esLimated expenditure in the estimates say for this year; or even ta ke it more precisely, for the year 1955-56. I will illustrate what I mean. For the year 1955-56 we had an esti­ mate of revenue and expenditure on current account of forty-two millions, and expenditure thirty-eight millions, showing a surplus of four hundred seventy-seven thousand two hundred dollars.

Last year in the budget we had different figures and without cit­ ing them precisely I may say that they indicated a surplus of two thousand dollars; two thousand dollars revenue over expenditure. But when the Audit­ or General's Report appears what do we find? lVe find there has been a deficit on current account, as noted. The Auditor General says on page IO of his report - "For the year 1955-56 current account revenue and expendi­ LUre respectivly amounted to •$39,753,-

752 HOUSE OF ASSEMBLY PROCEEDINGS 874 leaving a deficit on current account MR. SMALLWOOD: Mr. Speaker, of $58,561. Now honourable mem- that is not a grievance. hers on the other side of the House may read their pape-rs, but I think it is a very serious matter if we cannot depend upon the accmacy of the fig­ ures presented here in the budget speech. MR. S•MALLWOOD: Mr. Speaker, to a point of Order. Everything the honourable gentleman has said would of course be appropriate and certainly in order in a speech made Oil the budget in debate on the budget.

I suggest to Your Honour it is entirely out of order on the motion for Your Honour to leave the Chair now to go into Committee of Supply. The Par· liamentary Rules provide that hon­ ourable members may speak to that motion; the motion that is now before the Chair before Your Honour would leave the Chair and the House go into Committee on Supply. It is in or­ der for the honourable member to speak to that motion up to a point and within certain very strictly laid down limitations. But that has never been the occasion and can obviously not be a substitute for the debate on the budget.

If there were some urgent public matter or something of that nature then this -would •be an occasion Lo raise it. I suggest to Your Honour the honourable and learned gentle­ man is out of order. If the debate on the budget is not to go forward today he cannot debate it. That is all he is doing. I suggest to Your Honour he is out of order. MR. BROWNE: Mr. Speaker, what I am doing now is a time-honoured right of any member of the House to raise a grievance, and I am raising a grievance that the accounts of lhis country, the public accounts of this country and the estimates are not being properly considered. MR.

BROWNE: What else is it? MR. SMALLWOOD: Anything the honourable gentleman does not agree with does not necessarily become a grievance. If the honourable gentle­ nwn was to complain about the wea­ ther, is that a grievance? MR. BROWNE: Not the weather. The matter is in good hands. This is a matter in the hands of the Govern­ ment. The point, ·Mr. Speaker, is this -As I mentioned, we have the public accounts tabled-we have no commit­ tee dealing with it. We have the es­ timates tabled and have no committee to deal with the estimates; no special select committee-.

It is my contention we should have a special committee. MR. SMALLWOOD: Mr. Speaker, to a point of order-The honourable gentleman can make all these state­ ments in the debate on the budget. He must not try to anticipate the de­ bate on the budget. The opportun­ ity will be here when the budget is debated. He must not attempt to anticipate the debate on the budget speech- MR. SPEAKER: If the honourable member would excuse me.

I listened quite carefully to what the honourable member and the honourable member for the Opposition have said-this is the first time I have been in the House when a matter of this kind has come up. Definitely what the honour­ able member for St. John's South is doing is debating the budget. MR. IlROWNE: No, Mr. Speaker, I am not debating the budget. I have no•es for a speech to deliver on the budget but ,1 never will have an op-

HOUSE OF ASSEMBLY PROCEEDINGS 753 port,mity to deliver that in the House now, apparently. MR. SMALLWOOD: That is not the fault of the House. MR. BROWNE: Yes, it is the fault of the Government. The Government does not want to hear it. MR. SMALLWOOD: We will have t'.1e debate on Monday. MR. BROWNE: As the Premier knows, I cannot come on Monday. MR. SMAI;LWOOD: The Opposi­ tion can come here. MR. BROWNE: Yes, but cannot cleliver the speech I have. MR. S'PEAKER: Order.

It does not seem to me this would come under the heading of a grievance-the honour­ able member discussed the question with me on this point-but I do think he is anticipating the budget speech in the remarks he is making today, and I must hold the point of ord er well taken. MR. BROWNE: ·well, Mr. Speaker, if I am ruled out on this point of order I would have to bow to Your Honour's ruling- ! would like to raise then another grievance, if that is not considered a grievance I hope this won't be consid­ red a part of the budget debate.

Every year since 1952 a sum of money has been voted for this House for publi­ cation of a document called "Han­ ;ard," that is for 1952-53-54-55-56 and again in the estimates this year; that is six years voting of money for the publication of Hansard, and the last edition of Hansard appeared in, I do not know when it appeared, but it has not contained the debates of any session of the House since the session of 1951-That was held before the election in November of that year.

Now, Sir, I think it is a grievance that the public monies of this country should be spent on stenographic re­ pons of the debates that take place here and the employment of an editor to edit the debates and the payment of printers to print the debates, and that they should be retained in the estab­ lishment that has printed them. I have known for several years that these documents have been printed ancl they have never been published; therefore they are still in the print­ ers' office. Now I think, Mr.

Speaker, the people of this country are entitled to have the records of proceedings of this House of Assembly published so that honourable members can obtain them and so that the public, if thel wish, can have access to them and see what is happening. It seems a strange thing that documents which were re­ corded back in 1952 are still unavail­ able to members of this House or to the press or to the public . How long is this sort of thing to continue, and what is the reason? The Government do not wish to have these Hansards for these important years in our his­ tory published? I think, Mr.

Speaker, it is unnecessary to say very much on this matter, or to make any reply to Lhese questions-it is perfectly obvi­ ous that these were in the hey-days of Government when they were enjoying the money that had been saved by the Commission of Government and they could afford to have more optimistic hopes of the results of their gambling than they have now when the Gov­ ernment ha.1 been reduced to depend on the low market and loan market. and the generosity of the Canadian Government. Would any member of the Government like to reply to that matter?

754 HOUSE OF ASSEMBLY PROCEEDINGS MR. SPEAKER: As Speaker of the House I am in some degree connected with Hansard although not very much having not been Speaker very long. Ilut I can say that the death of the I.ate Edit.or of Debates has held the matter up to some extent As far as I know there are at the moment two if not three years of Hansard in the hands of the printers. I was told a few clays ago there were definitely two and may be three, but I will be able to make a statement on that , as Speaker, in the near future. MR. HOLLETT: Mr.

Speaker, I might say, in rising to support my learned friend on this statement rela­ tive to Hansard, I do think it is a pity that the Government at least the people responsible for the Hansard have not been able to produce them here in this House, and I think the grievance is well taken and well stated, and I appreciate the statement which you have made relative to a statement from you in the near future. There is one other matter I would like to raise, and that is this question of Committee on Supply.

On the 26th of March we went into Committee on Supply in order to pass some supple­ mentary estimates, 1 take it the Hon­ ourable the Minister of Finance or the Honourable the Attorney General will give us an explanation as to why it was necessary at this moment to go into Committee on Supply for supple­ mentary estimates I take it that state­ ment will come when we go into Com­ mitt;ee-is that correct? MR. SPEAKER: Yes-The motion now is that I do leave the Chair. No cloubt in Committee the Minister con­ cerned will begin by offering an ex­ planation. On motion Mr. Speaker left the chair. MR. CURTIS: Mr.

Chairman, the position is very briefly that when in March the interim supply wa.s bronght down it was pre sumed that the budget would have been delivered a couple of weeks ago and the estimat e was such that had that been the case we would have passed supply and this interim supply would not be needed as full supply would be available to the Gov ernment. As it was, a situ­ ation over which we had no control delayed the budget and one or two departments are short of money, parti ­ cularly the Department of Education. I would ask if we could pass these four or five items set forth in the

schedule and the committee would then rise and resume sittings at the convenience of the House . These are just interim payments. In addition to interim supply we did not antici­ pate such a lengthy interval between its being voted and today, MR. BROWNE: Mr. Chairman, the . .\ttorney General did not give us any information as to what this money is for . I wonder if he could tell us what the money is needed for. I have here the estimates passed in March for six million dollars; and in that Bill Fi­ nance was set down as one hundred thousand dollars. Now I see he is looking for eighty-five thousand dol­ lars.

Could he tell us what that is for? MR. SMALLWOOD : One word covers it-one word, Mr. Chairman, covers all of these amounts; salaries­ civil servants and teachers. MR. BROWNE: How is it that only five departments are looking for it and not the others? MR. SMALLWOOD: The others have enough. MR. BROWNE: Mr. Chairman, be­ fore we go on-the Minister has said

HOUSE OF ASSEMBLY PROCEEDINGS 755 salaries. Now I have here the vote for salaries for the Department of Finance, four hundred and twelve thousand dollars and the vote was a hundred thousand. So that was enough for three months. So th ere must be something more than salaries that are intended-another eighty-fiv e thousand dollars- MR. SMALLWOOD: That is our information. The Minister and De­ pu ty-Minister have left the Province today, and I am acting as Minister of Finance, but I am in the unfortunate position of not having the Deputy Min­ ister in the Province . My advice is that this is all for salaries. MR .

BROWNE: Well it must be for something else, according to thos e figures here. MR . CUR TIS: I think the position , Mr. Chairman, is the actual amount asked by the Government for the De­ partment of Finance is one million eight hundred thousand and the amount voted was only one hundred thousan<l. ·well obviously there is not enough. One hundred thousand is one eighteenth only of the amount that is sought for the Department. So it is obvious they must need some money . ,ve are now near the end of May. MR. BROWNE: It is certainly 1101 salaries though. MR.

SMALLWOOD: Almost ent ire­ ly salaries-the large part of one-half rn ill ion is for interest paymell't and sinking fund and the like on the public debt, the four hundred thousand for salaries is for the whole year, but only one hundred thousand has been given so far for everything-most of Iha! has been spent in fact for salaries. MR. BROWNE: Well, Mr. Chair · man, I do not think it is salaries, bu 1 T think it also covers pensions-and no doubt that is what was intended to say. MR. SMALLWOOD: Oh, no doubt? On motion Department of Finance $85,000. Carried. DR. ROWE: Mr.

Chairman, there is just one point there worth men­ tioning . Probably the Committee will recall it is customary for the Depart­ ment of Finance and the Department of Education to release money to the various boards of education around the 20th. and 21st. of the Month in order that the boards be able to handl e teachers' salaries at the end of the month . That is almost entirely that amount there for teachers' salar­ ies. The department may not rele ase the money until the House has voted it. MR. BROWNE: Perhaps the Min­ ister of Health would be able to tell us? HON. DR. J.

MCGRATH (Minister of Health): I cannot tell you exactly. It is practically all salaries. HON. C. H. BALLAM (Minister of Labour): I think the Minister of Heath is in the same position as we are . \Ve have five thousand dollars for Labour, and in our Vocational Training Apprenticeship Scheme fifty per cent is paid by the Federal Gov­ ernment but we have to carry on until such time as it comes in. So that this will be written off. I imagine the Minister of Health is in the same position . On motion Education $430,000; Health $175,000; Economic Develop­ ment $5,000; Labour $5,000; carried. MR. CLARKE: Mr.

Speaker, the Committee of Supply have considered

756 HOUSE OF ASSEMBLY PROCEEDINGS the resolutions and directed me to re­ port same and beg leave to sit again. On motion report received. On motion resolutions read a first time, read a second time. Motion, that a ,Bill be introduced lo give effect to those resolutions. Carried.

On motion Bill read a first time­ by leave of the House-"A Bill, "An Act .for Granting to Her Majesty Cer­ tain Sums of Money for Defraying Cer­ tain Expens es of the Pu'blic Service for the Financial Year ending the Thirty. first Day of March One Thousand Nine Hundred and Fifty-eight and for other Purposes Relating to the Public Services." On motion and by leave of the House Bill read a second time. MR. CURTIS: May I ask, Mr.

Speaker, with the unanimous consent of the House, and by leave, that the Bill be now read a third time-I do not think it is necessary to refer it to a Committee of the Whole House when it comes from Committee. MR. SPEAKER: No, according to Standing Orders a Supply Bill does not have to go to Committee again. MR. HOLLETT: I wonder , Mr. Speaker, if I might raise again the question which I raised with the Min­ ister of Education a short time ago, this afternoon, relative to whether or not the Government have here a mat­ ter, under Education for four hundred and thirty thousand dollars.

I think this would be an appropriate time to raise the matter again, and the Min­ ister may be able to make a statement relative to that because I do know that there are retired teachers in this country, and some of them have seen me about it, and I dare say there is no doubt a good many of them have seen the Honourable the Premier and the Minister of Education-some of these teachers have retired with fairly small pensions and since that time the cost of living has gone up considerably, and since that time the tea chers salaries have been raised and we know it is the intention to raise them again anothen ten per cent.

Now the point I want to know is what about those retired teachers living on very small pensions; is there no possi­ bility their pensions may be increased so that they will be able to live nearer to a standard of common decency, or whether the Government yet consider. eel that-I was hoping I might get a statement from the Honourable Min­ ister or from the Honourable the l'r emier on that point now. MR. SPEAKER: That speech was by leave of the House. Definitely out of order. DR. ROWE: Mr.

Speaker, the Honourable Leader of the Opposition raises a very important matter there, and he does know, as the House knows, it has only been some ten months that I have been in the De­ partment and there are a number of important issues with which I have not been able to familiarize myself, for obvious reasons.

I think I could say something right off hand but would prefer in justice to the honourable member and to his question I would like to have a little notice so that I can _go back and look up correspond­ ence and files on the matter and dis­ cuss it wilh officials in the Depart­ ment to see exactly what is the ques­ tion. I might say, Mr. Speaker, I have no desire at all to evade the question. Of course I take it we shall be meet­ ing again here on Monday or Tues-

HOUSE OF ASSEMBLY PROCEEDINGS 757 day and by then I might be able to give an answer to that question. MR. SPEAKER: Regarding the point raised a moment ago. According to our Standing Orders the resolution is adopted by vVays and Means, report­ ed to the House, put by the Speaker and incorporated in the Bill of Supply or appropriations, introduced by the Finance Minister and given its three readings then and -there. This is the only Bill exempted from Standing Orders 58: MR. BROWNE: Mr.

Speaker, may I point out "the Committee on Ways and Means" not the Committee of "Supply"-Ways and Means deals with resolutions such as the Disabled Per­ sons Allowance Act and the Old Age Assistance Act which should come in by way of resolutions, then on the re­ port of the House there is no need to go back into Committee again. Motion, that this Bill be now read a third time. carried: Ordered passed and title to be as on the Order Paper. Second Reading of Bill."

An Act Fur­ ther to Authorize the Government of Newfoundland to Enter into a Tax Rental Agreement with the Govern­ ment of Canada." MR. BROWNE: Mr.

Speaker, as I mentioned earlier today, in my opin­ ion this Bill should have been intro­ duced in the form of budget resolu­ tions and we should have discussed the whole situation, the whole finan­ cial situation at one time dealing with it now in very piece-meal fashion it seems to me to be improper-Here we are dealing with the question of the chief source of revenue of the Gov­ ernment and we are taking it in the form of a Bill, without discussing the budget and the other sources of reven­ ue. It is very difficult, Mr.

Speaker, to detach one piece of ou1 financial sources from others-We want -to be able to relate them- Therefore I am more or less confined by the manner in which this is introduced-But as everyone knows, under the Tax Rental Agreement expiring this year the mon­ ey received by Newfoundland from Ot­ tawa was related to the population and gross national product of Canada. A new formula has now been found, which sounds very complicated but in reality is very simple.

The Minister of Finance the other day told us that this formula granting assistance to the Provinces is based on ten per cent of corporation taxes and five per cent of succession duties taxes~and these are called standard tax yields- Then from these taxes in Newfoundland, per capita, is less than the wealthiest pro­ vinces, namely the Provinces of On­ tario and British Columbia; the aver­ age of these ·two provinces is taken and the difference is added to ours. Why they went to such trouble to draft a formula of that kind is be­ yond me.

I don't think it makes any difference - all they had to say was, we will give to the provinces an amount of money equal to the capital yield of taxes in Ontario and British Columbia based on their income tax, their corporation tax and their suc­ cession du ties on a ten, nine and five basis . MR. SMALLWOOD: What is the difference between the two? MR. BROWNE: There is no dif­ ference at all-Why put it that way it is? MR. SMALLWOOD: Why raise it? MR. BROWNE: Because in the way it is put down it looks to me extra-

758 HOUSE OF ASSEMBLY PROCEEDINGS ordinary procedure-share of the tax yield and tax equalization - A total of sixteen million three hundred thou­ sand dollars.

Now last year and in previous years we rented our income tax, corporation tax, succession duties to the Federal Government for a sum of about three hundred thousand dol­ lars which came to us - Now as every­ one knows, under the British North American Act, 1867, there were certain fields left open to the provinces and other fields for the Dominion-for ex­ ample the Dominion coHected Customs Duties, Excise Taxes; but the pro­ vinces used to collect income tax and corporation taxes and still do in the Provinc e of Quebec, and this year in the Province of Ontario-But Dur­ ing the World War II, the Dominion Government was pawerful enough to persuade the Provinces that they should give up their powers of collect­ ing income taxes and corporation taxes for the duration of the war and trans­ fer them to the Federal Government in Ottawa for a tax rental agreement.

MR. SMALLWOOD: Not then, there was no tax rental agreement, - in return for payments. MR. BROWNE: Which afterwards was called a tax rental agreement, and which gave to the various Prov­ inces certain amounts of money-At any rate the effect of it was, Mr.

Speaker, to concentrate the greater portion of taxes in the Federal Gov­ ernment at Otta,wa-As we know , the :Federal Governm ent at Ottawa today is collecting nearly eighty per cent of all taxes paid by all the people of Canada in every shape and form-The man who pays his Municipal taxes to the city council, the man who pays three per cent tax to the Provincial Government and seventeen cents a gallon on gas­ oline, the man who pays Income tax, of all these taxes, all the whole lot put together, the Federal Government is now collecting eighty per cent and the Provinces are collecting, I believe, less than ten per cent and the Mun­ icipal Governments are only getting roughly the balance-So that the power of the Federal Government has become collossal-it is a colossus, a giant, it overbears every province in Canada­ There is only one man who has suc ­ cessfully withstood the infringement of the Federal Government at the present time and that is Premier Du­ plessis who has refused to accept a tax rental agreement under any form and has insfated on the rights of the Province to collect their own taxes, and refused to deal with Ottawa as long as Ottawa pretended to be doing favours for the Provinces by giving them subsidies from time to time.

So great was this power in the past fiscal year that the Dominion of Canada had a surplus of over five hundred million dollars. over half a billion do!la1·s surplus­ This Government, I suggest, Mr.

Speaker, has had a deficit on the basis of the 1955-56 returns-I suggest this Government here has had a deficit, Nova Scotia had a deficit and other Provinces of Canada even Ontario, the richest of all, are complaining they have not sufficient money to carry on their work, and they have not suffic­ ient money to assist their municipal­ ities while the Federal Government at Ottawa has this enormous surplus of half a Billion dollars.

Now no province is satisfied with this-This province is not satisfied, the Premier is not satisfied-Only the other day he was quoted in the press-I am nor sure of his exact words-but to the effect that we should start a rev­ olution in the Atlantic Provinces against the authority of Ottawa-

HOUSE OF ASSEMBLY PROCEEDINGS 759 MR. SMALLWOOD: No-- No it was not that. MR. BROWNE: He certainly said we would lead the way to show the Atlantic Provinces how to get out of Confederation if they did not get satisfaction. MR. SMALLWOOD: No.-if they ever tried to treat us as second-class Canadians. MR. BROWNE: What are we be­ ing treated as-When the Minister of Finance's spending depends on the gen­ erousity of the Canadian Government what are we?

We are not relying on justice any longer, we are relying on the generosity-and should this Pro­ vince have to depend on the alms­ giving from the Dominion Govern­ ment or should it he entitled. MR. SMALLWOOD: What the Minister says was -"justice and gen­ erosity" together-to quote only the generosity is to misquote him. MR. BROWNE: I am satisfied to take the words-justice and generosity -I see he is not satisfied with justice. The Premiers of the Atlantic Pro­ vinces met recently-What for? To complain about the manner in which they were being treated by Ottawa and to look for further money from Ot­ tawa.

Now this Province is in the position that at the present time it has a Royal Commission investigating what financial assistance, if any, (this is generally left out in any statement) is needed to con tin ue tl1e public ser­ vices of this count ry al Lhe sta ndards and levels reached subsequ ent to un­ ion-At tl1e stand ard s and levels reach­ ed subsequent to union-I do not want to go over again what I said before­ It is a limiting formula and it is not enough for us to carry on in the fu- ture.

The Province of New Brunswick has come up with a proposition of a somewhat different nature from the tax equalization payments, so called, that is inserted here. Now I think it is a pity we are not in the budget debate, but the Minister of Finance shonld be here while this subject is being discussed too so that he could perhaps in reply give us some in­ formation on what that is based, what the population of Newfoundland on whim this ·tax equalization payment is made and what is the rate that we are receiving under the old agree­ ment.

At any rate in New Bruns­ w i c k they discovered under the old system New Brunswick received more money per capita than the Pro­ vince of Alberta, which is fabulously rich, but under the new agreement Alberta receives more money than the Province of New Brun swick; and the people of New Brun swick and certain­ ly the Governmen t of Ne"r Url)llSWick; feel that is not fa ir-t hat the Pro­ vince of Alberta receiving over six million dollars in the past ten years as a result of this wonderful oil and gas development ·that took place in that Province, and was therefore one of the richest provinces in the Domin­ ion; and to give to Alberta more mon­ ey than to one of the have-not pro­ vinces, one of the Atlantic Provinces, seems to me to be certainly erring on the side of justice-So they came up with what they called a National Ad­ justment Grant-and I am sure the Premier is very familiar with the na­ ture of the National Adjustment Grant but as other members of the House may not be so familiar with it I would like to bring it forward here, because it is a way by which the Atlantic Provinces would get a share of other taxes which they paid, because the other Provinces including Newfound-

760 HOUSE OF ASSEMBLY PROCEEDINGS land not only contribute profits to the Provinces of Ontario and British Col­ umbia as well but they contribute dir­ ectly to paying customs duties and ex­ cise taxes of which they get no share at all. The present tax equalization is based on income tax, corporation tax and succession duties .

At any rate New Brunswick brought forward the proposal that where the average earning power of the people was less than eighty-five per cent of the Can­ adian average, extra assistance should be given in order to enable the Pro­ vinces to carry on the financing that they are expected to perform.

Now in New Brunswick and the other Mari­ time Provinces they have a system of Municipal Government where the Municipalities are depending to a large extent upon the financial assistance which they receive from the Provincial Government&, and here in this country we are in the same position, and I suppose it is the same in all the Pro­ vinces. In Ontario this year, for the first time in eighteen years, the Trea­ sury brought in increases in taxes by actuallJ putting on a tax on corpor­ ations.

In addition to the taxes they have to pay to the Federal Govern­ ment they have to pay two per cenl to the Ontario Government- So that the Ontario Government by that tax and by a tax on gasoline, raising the tax on gasoline by two cents a gallon, I believe, and by raising the tax on diesel fuel nine cents a gallon were able to raise an extra sixty million dollars; and that with the thirty-nine millions which they receive from Ot­ tawa brings it up to nearly one hun­ dred million dollars.

As the popu­ lation of Ontario is about ten times the population of New Brunswick the Government. of New Brunswick felt they were entitled to a sum of about ten million dollars in addition to the eighteen million dollars which they are going to receive under the tax equalization payment from the stand­ ard tax yield; a tenth of what the Province of Ontario would receive -the population of Ontario is about five and a half million-So that I sup­ pose Newfoundland should feel entit­ led to, under that method of that national adjustment grant, a sum of about seven million dollars in addition to the tax equalization that we are receiving at the present time.

Cer­ tainly the Atlantic Province Premiers could have left no doubt in the mind of the Government of Ottawa that they deserved special consideration, be­ ing as it were here at the end of the line-We pay more freight in and out than anybody else, even in the Mari­ time Provinces; and the cost of freight and the cost of handling adds to the cost of goods and therefore the Pro­ vince needs more money in proportion than those provinces which are located where the factories are.

But only the Province of Ontario and the Atlantic Provinces by the Al­ berta Government :it,~elf feels that, and the Saskatchewan Government, feels that the Federal Government is not treating them right in regard to the question of taxes. ,ve have heard from time to time the Premier speak about our needs in regard to schools and in regard to roads and in regard to hospitals. Only the other day the Minister of Highways told us there were going to be no paved roads in Newfoundland this year, no roads paved in Newfoundland this year, certainly not by this Gov­ ernment. MR.

SMALLWOOD: I do not think there were any last year, and I do not think there were any the year

HOUSE OF ASSEMBLY PROCEEDINGS 761 before last. ,-ve have not done much paving in recent years. MR. BROWNE: I don't think there has been much since this Gov­ ernment came into office . MR. SMALLWOOD: We built about fifteen hundred miles but have done no paving. MR. BROWNE: Built a lot of roads but the winds and passing traf­ fic blow them into the surrounding country side, and the rain and snow falls on them and leave them in a very bad condition; and we are not making very much progress in the matter of roads. But why is it? Not because we are short of money .

I hear today that under the handicap under which the Government of New Brunswick is it's· spending twenty­ four million dollars this year on roads -twenty-four million dollars on paved roads-This Government is not spend­ ing any money. Surely one of the reaso ns why they are not spending any money is because they have not got the money, and are finding it extremely difficult to get it. We had a Bill last year authorizing for ten million dollars, a large amount of which was supposed to be devoted to the building of better roads-It did not materialize, and was used this year to pay the defici I.

I have here a few figures which show what I have mentioned a few moments ago in regard to the amount which the Provinces of Alberta and New Brunswick respectively received under the old method of tax rental agreement and the new one : New Brunswick received, $18,505,000 and under the new $22,645,000; Alberta un­ der the old $35,265,000 and under the new $46,350,000-per capita that works out at $32.58 under the old and $39.18 under the new and Alberta received per capita $31.51 and under the new $39.55, something higher than New Brunswick.

Now I am not able to say what it is that Newfoundland re­ ceived, but if we took the figure for $14,300,000. and a population of four hundred thousand that gives us rough­ ly $34.40 under the old system and under the new system of $16,300,000. and taking the population at four hundred and fifteen thousand it would work out something the same as New Brunswick and Alb erta, nearly forty dollars per head-In other words all the Provinces are getting very much the same amount of mony per capita under this tax equalization-where is the equalization then?

The Premier of this country started out in 1950, at any rate I think he had the idea in his mind before that of trying to build up the industries of this country so as to prevent the population of this country leaving and going to the Mainland, to other Pro­ vinces or to the United States. He must be aware and his Ministers must be aware that there is certainly a recession in this country today and a great deal of unemployment. There are thousands of men out of employ­ ment at the present time and looking for work-Where are they going to get it?

If Lhe wealthy province of Ontario is complaining that it is not getting enough money from the Federal Gov­ ernment at Ottawa with which to carry on their work, we too must find that we are unable to .do the work that we should be doing, and we are certainly handicapped by a shortage of funds at the present time. Now it has been said that the Gov­ ernment of Ontario is put out be­ cause money is being taken from Ont­ ario to give to other Provinces. That

762 HOUSE OF ASSEMBLY PROCEEDINGS is not so according to the statement I have seen from P.rernier Frost. Prem­ ier Frost has made a statement to the effect that Nova Scotia had a deficit last year, and should have received greater assistance from the Federal Government , while Alberta each year has a surplus and was receiving more money in proportion , I think it is safe to say, Mr.

Speaker, all the Pro­ vinces are disappointed with this new formula for one reason or another; Quebec because it does not approve of the method at a!l, Ontario and British Columbia and probably Al­ berta these rich provinces are disap­ pointed because they have fast-grow­ ing populations and they have needs too, and the Atlantic Provinces, of which we are one, are disappointed because we are handicapped, more handicapped than the richer provinces in obtaining money from other sources either from taxes or from borrowing -We are limited at the moment to any further taxes-Our taxes here are higher than in the other Atlantic Pro­ vinces, and our means of borrowing needs no elaboration.

Therefore, Mr. Speaker, I feel that I should offer these observations, and that our Government should join with the other Atlantic Provinces in de­ manding from the Federal Government at Otawa a national adjustment grant which would help to make things bet­ ter for this country. It is true that we have the Royal Commission at the present time, but it sems to me that in itself won't be sufficient. MR. SMALLWOOD: Mr. Speaker, I will not take more tha.n a very few minutes to reply to the honourable and learned gentleman who has spoken.

I sincerely regret that we are not to have the advantage in this House of b.caring from him on the matters about which he was only able to hint in his, present speech unless he were to get out of order-But after all we cannot have him everywhere, and we cannot set the order of business to pl ease just one member of the Op­ position although he be an extremely important member of it. If the Lead­ er of the Opposition had given us the slightest indication that he wished the debate to go forward today on the budget his wish wouLd have been our law i.n that matter.

Now yester­ day th e Leader of the Opposition was nol in the Chamber when the hon­ ourable and learned member for St. John's Sonth indicated that he would like to speak on the budget-But I do not think I would be justified, con­ siderable though my opinion is of the importance - MR. HOLLETT: I thought I was here yesterday-Diel I just wake up? MR. SMALLWOOD: I am wrong it was the day on which the budget was delivered it was yester.day just fol­ lowing the delivery of the budget that the honourable member for St.

John's South indicated his preparedness, in fact I may say even his anxiety to m ake his contribution today to the budget debate; but I heard not a word from the Honourable the Leader of the Opposition, and I must in all common decency be bound by his fol­ lowers unless they indicate they have cleared the matter with their Leader, in which case I woul.d take their views as being his. Now I have only one or two things to say about what my honourable and learned friend remarked here today.

He tells us that the Government of Canada collects about eighty per cent of all the taxes that are collected in Canada-When you include municipal taxes across Canada and Provincial

HOUSE OF ASSEMBLY PROCEEDINGS 763 taxes and these collected by the Gov­ ernment of Canada; if you add them all together, he says, about eighty per cent, eighty cents on every <lol