That this House condemn the government for its neglect of Labrador, and for refusing to resolve the injustice of the Churchill Falls hydro contract, thus perpetuating interprovincial trade barriers and denying the residents of Labrador the right to enjoy the benefits of their own natural resources.
Mr. Speaker, it is a pleasure to lead off the debate on what I think is an often neglected subject in the House of Commons. Labrador is a region of the country that is the news for its natural resources and for its natural beauty. It is something we appreciate as part of Canada. However, it is an area that is taken for granted and has been taken advantage of for years.
It is time to address some of those issues in this debate. I hope that during the discussion we will be able to decide how we can better appreciate the assets of Labrador and correct some of the wrongs that have been perpetrated on the region in the past.
Yesterday during question period we discussed how a contract was awarded in Atlantic Canada but was taken away from a Halifax firm and awarded to someone in another province. Atlantic Canadians, and in particular Labradorians, feel that has happened far too often.
The Churchill Falls contract has been a severe irritant to the people in Labrador since it was signed 25 or 26 years ago. The contract forces Labrador and Newfoundland to sell its power to Quebec, which in turn sells it to the Americans. The price is jacked up 25-fold and Quebec reaps the benefits of a deal that pays almost no return to the people of Labrador.
The people of Labrador deserve much better than this. For 25 years they have sent off their electricity, specifically, and in return have received almost no benefits. They have had almost no infrastructure spending in their region. They do not have a passable highway through their region. They do not receive the tax benefits of a deal that is worth $800 million a year to Quebec.
Every time a premier from Newfoundland says: "We are going to renegotiate, we are going to be tough, we are going to force the federal government to use some of its powers" nothing happens. This has been going on for a long time.
Labradorians are going to make another choice in the next election about who will represent them best in the House of Commons. They will be looking to see how sincere the federal government is in addressing what has been, as we all know, an injustice to the people of Labrador.
Recently we have been hearing more talk from the government side that it is working on an internal trade agreement that will help the free flow of goods between provinces, including trade in electricity. Two years ago it came forward with a trade agreement that would break down the internal barriers to trade. However, the energy chapter is missing. It said not to worry, that by July of last year it would have the energy chapter all intact. That did not happen.
By September of last year a government spokesman said: "Now we will have the contract" but again it was not signed. In other words, the federal government does not seem to be able to understand that an internal trade barrier called Churchill Falls is holding up the entire internal trade agreement. It seems unwilling to exercise its powers and influence to strike that trading barrier down. During the day other speakers will be elaborating on specific points.
I would like to emphasize that although there is much the federal government can do to address this wrong, some of the feel good messages being sent out by the new Quebec premier about how he wants to get along with people, mend fences and so on, it would be a good time for him to express some of those feelings of goodwill in striking a new agreement with Labrador on Churchill Falls.
It is not enough to say we would like to get along. If something is unjust and we know it is unjust, then it needs to be addressed. I
would hope that the new Quebec premier will take the opportunity during these negotiations on the internal trade agreement to fix what is an absolute injustice to Labrador and renegotiate that contract.
In 1969 Newfoundland signed a deal that sold power from Churchill Falls to Quebec for 65 years. Newfoundland signed this deal for two reasons. First, there was an energy glut at the time. It was before the rise of OPEC, the rise in the cost of energy generally in the world.
Second, Quebec frankly refused to allow Newfoundland to build transmission lines on its soil in order to transmit that electricity to the New England states where it was to be sold. In essence Newfoundland had to sign the deal. There is a contract, there is a deal and that cannot be denied.
The deal is so bad and so unjust that it is time not only the Quebec government, but the federal government, waded into this fray and said this is so wrong and it needs to be addressed.
Labrador has no access by land to the rest of North America except through Quebec. Quebec at the time had Labrador over a barrel. Labrador and Newfoundland signed. I wonder where the federal government was at the time. It was an unjust deal. Trudeau refused to deal with it. Clark refused to deal with it. Turner did not deal with it. Mulroney would not deal with it. The current government seems content to talk about it some more. It is talking and it urges us to be patient.
The people in Labrador are tired of being patient. When does the deal expire? It does not expire for another 45 years. For 45 more years the people in Labrador are expected to sell their power at one twenty-fifth of the going rate. Twenty years from now there is a renegotiation clause and the rate will drop again. Labrador will get even less money. It is so unjust that it has to be remedied.
Quebec has an opportunity to show its good faith and willingness to negotiate. The premier of Quebec says he wants good relations as a sovereign nation. It would be a good step for him to renegotiate a contract that is obviously unjust. At the end of this contract in 2041 Labrador will have transferred almost $50 billion to Quebec under this contract. That is $800 million to $1 billion a year. I understand that Quebec signed in good faith at the time but they need now to address an injustice.
The federal government can do something. It could not break the contract, of course. However, it could regulate interprovincial trade. This is one of the powers that should be enhanced as we reconfigure Confederation. Many things should be transferred to the provinces. This is what the Reform Party has said time and time again. We should allow the provinces, Quebec, Labrador and Newfoundland, all the provinces to benefit from their own natural resources. We should transfer many of the responsibilities to the provinces. I think that realignment of powers is a good sign.
One of the things the federal government should do is strengthen its power to regulate and to strike down interprovincial trade barriers. Those barriers cost Canadians between $3 billion and $5 billion a year. The first thing we must do is strike down those barriers if we are to have a free trade agreement that works in North America and the world.
In July of 1975 the minister of energy, Alastair Gillespie, said in a speech in Labrador that he favoured the use of the BNA act to declare hydro lines to be under federal jurisdiction so that they could be built across provinces.
In the west we do not deal much in the transfer of electrical energy, although certainly it is transferred without interest. However oil and gas products are transferred across provinces without an $800 million a year transfer in western Canada.
In 1976 the member for Grand Falls-White Bay-Labrador, Bill Rompkey, now a senator, and the person whose seat in Labrador is now vacant because he has been bumped up to la-la land in the other place, asked this of the minister of industry.
-is the Minister now optimistic that hydro resources in Labrador can be developed for the benefit of the Atlantic region, and will he ensure that the full force of his office, and indeed the Government of Canada is used to bring this about?
Of course there was no answer from the government of the day. Mr. Rompkey said he would talk about it and maybe someone would fix it some day. Here we are 20 years later asking a Liberal federal government about Mr. Rompkey's comments. Is it willing to champion the cause of Labrador and make this deal and the future development of lower Churchill Falls an important issue for the federal government? It does not seem to be.
It is interesting that other parties have made comments about this. In 1976 John Crosbie, the member for St. John's, said: "The federal government has put us in the hands of Quebec". To that a parliamentary secretary on the Liberal side responded: "The government has a strong preference to explore the co-operative approach and to consider exercising constitutional leverage only as a last resort". In other words, "we would like to talk about it", they said in 1976, 1977, 1978, 1979 and for the rest of time, "and Labrador just has to be patient. You do not get a road. You do not get to develop your own assets. You do not get to benefit from future development".
People now in Labrador are saying: "Are we even going to benefit from Voisey Bay? What do we do, just take it on the chin? You eliminate our fish stocks. You take away our way of living.
You take away our future prospects for benefiting from our own natural resources". It is a shame.
In 1980 Mr. Trudeau, another well known Liberal, said: "The federal government could act if two conditions were met: if Newfoundland had an actual contract to sell power and if Quebec charged too much to transfer that power to Newfoundland". He said the federal government would act. He said an unreasonable charge would constitute a trade barrier.
This places Labrador and Newfoundland in a catch-22. How can they enter into a contract when they cannot get permission to transfer their power? If they cannot get permission, how can they get a contract? If they cannot get a contract the feds say they will not act. There they are hung on the horns of a dilemma saying: "We would like to develop something. We would like to put forward a proposal but we are not allowed to wheel our power through Quebec and we are not allowed to build transmission lines. What are we supposed to do?"
The federal government should step in and say it wants to help Newfoundland and Labrador and it is willing to do it in a couple of ways. There are a couple of avenues for addressing this problem.
The first thing the government could do is follow up on a recommendation by a federal government mandated group which tabled a report in 1988 called "Energy and Canadians: Into the 21st Century" which we are approaching. The section entitled "Federal Government Role" recommends:
The federal government should articulate the conditions under which one province has a right to access, on a business basis, another province's electricity corridor or electrical grid for the purpose of transmitting electricity to a market not adjacent to the first province.
In other words, in 1988 again it said: "The federal government should set out the terms and conditions that we could transfer power from one region or one province through another province for sale". The federal government should do that and that has been recommended by that government mandated group back in 1988, which again promised to do something about it.
That is the first thing the government should do. It should state the right of provinces on interprovincial trade, that the right exists. The government should say it will happen, the right exists to transfer power on the electricity grid, to wheel power through another province for sale. The federal government should say that is part of its job and it will do it. It would not require legislation. It is a statement of policy. That is what we should at least be attempting, but the federal government is reluctant for some reason to even do that.
If that is not enough the federal government could take another step. Several suggestions were made by the National Energy Board in a study in 1992. If people in Atlantic Canada could live on studies they would have a very high standard of living. They have been studied to death and everyone tells them they all need help.
The Inter-Utility Trade Review in 1992 suggested several amendments to the National Energy Board Act. One suggestion was to amend the act to give the NEB the power to open up Quebec's transmission lines to allow exports of electricity to other provinces and regions. We are not talking about expropriating any land from Quebec. We are talking about the opportunity to use the lines. Other provinces do it; why not through Quebec? The NEB act could be amended to do that.
The same study talked about the huge benefits of that free trade in electricity; up to $3 billion a year Canadians would benefit from. Another NEB suggestion which can be used is that we can ask for a land corridor to build a new transmission line through another province. We have the power to do that. Section 58(4) of the National Energy Board Act says we can designate a corridor through Quebec.
However, we have to do something because it has been talked about for 25 or 26 years with promises of more studies, talks and negotiations. If the people in Labrador and Newfoundland are told they have to pay 25 or 30 times more for the power to run their own homes and businesses than the selling price is for export, it is unacceptable. The people in Labrador deserve the right to develop and benefit from their own natural resources.
If anything is to come out of the negotiations to settle what role each level of government has in the future of Canada, surely the people who should benefit from the natural resources should be in the province that owns the natural resources. Certainly Quebec would want and demand, and rightfully so, the control over its mining regulations and control over its own destiny when it comes to natural resources. B.C. demands the same thing. Labrador and Newfoundland demand it and should get no less. It is $800 million a year which is not going down the tubes but down the lines and the people are not getting the benefit of it.
The people in Labrador have been taken for granted for too long. It is time the federal government stood up for them and said it will doing something, that it will articulate a policy to request that the internal trade barriers come down, that the people in Newfoundland benefit, that the people in Labrador get to develop their natural resources, that Voisey Bay will not be farmed out to Ontario or to another province, that Newfoundland and Labrador will have the electricity, power and access to the natural resources so that they can become a have province and not dependent on others for a federal transfer payment.
If we were to move that way today and at least say that is to be the policy of the government and the thing we are striving for, we could send a message to the people in Atlantic Canada that they are
not there only for the votes come whatever, but that they are also there because they deserve the right, as Reform Party policy states, to develop their own natural resources.
I hope the House will agree with me today. I anticipate and hope someone on the Liberal side has been studying this issue and will say more than we should talk, study and think about it, but that they are now ready to act.