Dave Chatters

[Marine Conservation Areas Act, November 24th, 1999]

Mr. Speaker, it is a bit of a challenge to debate the Group No. 1 amendments simply because they appear to be a measure by the Bloc Quebecois to delete every clause of the bill.

In view of that I will address the bill more generally, simply because I have not had the opportunity to do so. I will address some of the specific amendments in other upcoming groups. In view of what the Group No. 1 amendments represent and that the government does not appear to be engaging in the debate at all today, I will address some of my general concerns about the bill.

Canada has both a national and international obligation to ensure the viability of our east, west and Arctic coasts. All members of the House would probably agree that it is crucially important for us to protect our marine areas. Many clauses in the bill merit consideration and support. We would certainly consider supporting many of them if we could agree on amending some of the other ones.

I agree with the Minister of Canadian Heritage that we must protect our 29 marine regions. There are many ways in which these areas could be neglected or, in a worst case scenario, even destroyed. Conservation efforts are necessary to ensure the future existence and prosperity of our marine areas and with this in mind I support the concept behind the bill.

I also believe strongly in the principle of polluter pay. It has great merit and it makes sense to anybody that those who pollute should pay to fix the damage they cause. Unfortunately sometimes that damage is unfixable and it is difficult to impose just compensation on those who would cause that kind of destruction.

Unfortunately I have many serious concerns that make it impossible for me or my party to support the bill in its current form. The bill appears to fulfil preservationist environmental objectives instead of the usual objectives of national parks, historic or heritage sites. For this reason the bill belongs squarely in the portfolio of the Minister of the Environment. Lacking that, the portfolio of the Minister of Fisheries and Oceans would better fit the bill than that of the Minister of Canadian Heritage.

The efforts of the Minister of Canadian Heritage to expand her domain make my uncomfortable. Not only would the bill allow the heritage minister's domain over decisions regarding marine conservation areas. She could do so with increased discretionary powers.

Bill C-8 proposes that the establishment of marine conservation areas would be ruled by three Henry VIII clauses. The minister could designate new areas under the act without having to steer an amending act through parliament. The usual legislative process would be sidestepped completely.

Canadians are all too aware how the government likes to sidestep proper legislative process. However, in matters as important as marine conservation, I would hope that the government would forgo its usual policies of sleight of hand legislation and instead adopt due process.

To the government due process means that the legislation goes immediately to a government ruled committee. If that committee has any objections, which is highly unlikely due to the Liberal majority, the entire House of Commons must confirm the objections. Should the committee not raise any objections within 21 days the amendment is passed by order in council.

I do not see a great deal of general MP involvement in the process. If a Liberal dominated committee does not come up with any objections, the amendment goes forward as is. Where is the debate? Where is the careful consideration? Where is the public consultation? The Liberals are truly masters of illusion, that is the illusion of the democratic process.

It is only fair and right that Canadians affected by these changes be given the opportunity to take part in the process. At the very least, Canadians should be involved so that the changes to their communities and businesses can have minimal negative effects.

Aboriginal communities across the country have expressed their opposition to the bill as have many resource based industries. The overwhelming negative public response we have seen has been completely ignored by the government.

The intent of Bill C-8 is to protect marine environments. No one would disagree that such an effort is very important. However it is unreasonable and impracticable to forge ahead without taking into consideration the effects such efforts will have on communities that rely on the oceans for food and economic sustainability.

We have all heard what drastic effects the cod fishing moratorium had on countless communities in Newfoundland. Many communities were literally wiped out because people simply had no way of maintaining their lives without the cod fishery. Generations have grown up with cod fishing as their primary source of food and income. However that heritage was banned and communities all over Newfoundland suffered terribly.

Now the heritage minister is looking to destroy Newfoundland's remaining fishing heritage by banning all fishing activities in protected areas. No fishing would be allowed unless a special discretionary minister's permit has been given to the individual. I can only imagine how difficult it will be for the ordinary citizen to get one of those permits. Certainly we have experience with the abuses of ministerial permits in other areas and other sectors in which the government is involved.

After the cod moratorium many fishermen managed to transfer their skills to other fisheries and are trying to eke out a living. However the bill will quickly put an end to those efforts.

The committee heard from the Canadian Aquaculture Industry Alliance on one proposed marine conservation area. I understand that since the time of the hearing, because the bill has dragged on for so long, that the creation of the particular proposed marine conservation area has been dropped. However at that time it certainly was not.

The area extends from Cape Bonavista to North Head in Notre Dame Bay. It contains approximately 25,000 to 30,000 square miles of coastline. Within the area there is a large inshore fishery with approximately 2,000 fishing licence holders, 35 aquaculture licence holders, and many fine cod farming sites. The total value of fishing and aquaculture industries in the area is almost $600 million.

Obviously this area is crucially important to those who rely on fishing and agriculture opportunities. Yet this zoning has a potential which still remains today to permanently shut down much of the fishery in Newfoundland, displacing thousands of Newfoundlanders who desperately need the industry.

When the cod moratorium was brought into place many Newfoundlanders saw hope in the growing interest in exploration and production possibilities in the Grand Banks. Since then many people have had their hopes realized because projects like Hibernia, Terra Nova and Sable Island have brought jobs, training and foreign investment to Newfoundlanders and all Canadians.

If Bill C-8 goes ahead, a rich potential for future development within the Grand Banks will never be realized. To declare the Grand Banks a marine conservation area ignores the fact that drilling projects such as Hibernia and Terra Nova have very strict environmental protectionist guidelines to make sure the surrounding marine ecosystems are not damaged. It is a perfect example of what we call sustainable development in Canada. It is a far more desirable goal than the protectionism we are talking about.

In my opinion it has not been the development of our natural resources offshore that has endangered the marine habitat in Canada's oceans. It has simply been poor management and overfishing, not resource development.

If the Grand Banks are closed to industry the government will make sure, although the marine area continues to flourish, that the economy and well-being of Newfoundlanders will suffer terrible damages.

Another consideration must be what effect Bill C-8 will have on Canada's mining industry. There are indications that vast amounts of mineral deposits might be found under the floor of the Pacific Ocean off the coast of Canada. According to committee testimony these deposits could be worth several billions of dollars.

Should the Canadian government investigate these sources there will be vast revenues from the deposits. Exploration will ensure that Canada stays on the cutting edge of mining and marine technology. Yet Bill C-8 will put an end to all future mining exploration in our oceans.

If the bill goes forward, Canada will lag behind the rest of the world in mining production and related technologies. The mining industry in Canada will suffer serious damages and thousands of skilled, trained workers will be displaced. The closure of the Devco mine has already shown us how devastating the failure of an industry can be.

I will close on this part of my presentation and readdress some of my further concerns when we get to some of the other upcoming groups. I will continue this debate as we go along.

[Nuclear Waste, November 17th, 1999]

Mr. Speaker, perhaps it is time the Prime Minister needs takes a reality check. He is forging ahead with his swords into ploughshares plutonium test burn program despite the fact that Canadians do not want to be involved.

Communities along the test route, such as Windsor, Sarnia, Cornwall, Sudbury, Thessalon and Nepean, have all condemned the plutonium shipment. Neither the province of Ontario nor Ontario Hydro wants any part of the plan. Mohawk leaders have made it clear that the shipment of plutonium will not occur on their land. The United States has pulled out and instead has chosen to burn plutonium at home. Even the Liberal dominated foreign affairs committee recommended against the plan.

If the federal government does forge ahead, ignoring almost unanimous opposition to the program, it will not eliminate one nuclear warhead. What we are talking about here is surplus plutonium not the dismantling of nuclear warheads.

The fire has gone out of this test burn scheme and it is time the Prime Minister worked up the moxy to cancel the MOx plan.

[Cape Breton Development Corporation Divestiture Authorization And Dissolution Act, November 15th, 1999]

Mr. Speaker, I listened carefully and I certainly appreciate the comments of the member. Being a native Cape Bretoner, certainly his comments are from the heart and very relevant. He gave great voice to the concerns of the working people and the miners of Cape Breton, but there are a couple of areas I am still kind of confused about.

What exactly is the position of the member and his party when it comes to the future of coal mining in Cape Breton? Does he support the closure of the coal mines or does he not?

Further, I would like to hear the member's views on the proposal by the hon. member for Broadview—Greenwood who expressed such confidence in his minister's ability to turn Cape Breton into the Hollywood of the north. We have some wonderful, talented people from Cape Breton, certainly Hank Snow, Rita MacNeil and some others come to mind, but is that the future of Cape Breton? I wonder how much confidence the people have in that kind of a proposal or in the idea of turning Cape Bretoners into bureaucrats working for the government, as has been done in so many other parts of Atlantic Canada.

Last, what would his party's position be with the idea of the private sector being allowed to use the world-class pier in Sydney, Nova Scotia, which belongs to Devco, for the import and export of value-added products from the massive oil and gas reserves off the coast of Nova Scotia and Cape Breton and using the free trade agreement to access the markets in New England for those products that would perhaps be manufactured in Cape Breton and Nova Scotia?

[Nuclear Waste, November 15th, 1999]

Mr. Speaker, the United States does not want Canada to burn its waste plutonium. Russian waste will only be imported if Canada pays for it. Ontario Hydro does not want to burn plutonium and the Mohawk leaders will blockade the shipment. Residents and town councils along the proposed route have condemned the plan. It is pretty clear that Canadians do not want a test burn.

Will the Prime Minister call off this unnecessary and unwanted test burn today?

[Cape Breton Development Corporation Divestiture Authorization And Dissolution Act, November 15th, 1999]

Mr. Speaker, I am pleased to rise today in the House to speak to Bill C-11, an act to authorize the divestiture of the assets and to dissolve the Cape Breton Development Corporation, to amend the Cape Breton Development Corporation Act and to make consequential amendments to other acts.

In short, the Reform Party intends to support the main thrust of the bill although we have some concerns and we will be introducing some amendments to address some of those concerns. However, in general terms we will support the sale of the assets of the Cape Breton Development Corporation.

We congratulate the government in finally getting around to addressing the problem that maritimers and other Canadians alike have witnessed for years and years. The Cape Breton Development Corporation was originally the baby of Prime Minister Lester B. Pearson, which gives one an idea of how far back the history of the whole matter goes.

Most people today refer to the Cape Breton Development Corporation as Devco. It was and still is a disastrous money pit for the taxpayers of Canada. As far back as 1957 it was recognized that the coal industry in Cape Breton simply would not be sufficiently viable to sustain the economy of Cape Breton on a long term basis. In 1966 the Donald report commissioned by the Government of Canada recommended the downsizing of the Cape Breton coal industry and chose 1980 as the target for production to cease.

In the same year Prime Minister Pearson and Nova Scotia Premier Robert Stanfield announced a $55 million package to phase out coal mining in Cape Breton within 15 years. It would not have been easy for the miners or their families, but postponing the agenda from what was originally planned has certainly spawned a whole new generation of miners. Some of these miners will be losing their jobs at a relatively young age and will not qualify for pensions, which has prolonged the same problems expressed during the debates in the time of Mr. Pearson.

It was recognized that without diversification the long term effects on the economy that supports these same families would get increasingly and drastically worse. The economy would become dependent on a dying industry, which could then lead to dependency on government programs and subsidies. In 1966 such forecasts were only warnings of things to come. Thirty years later Devco has realized all of the predictions and the worst elements of the early earnings.

In 1967 Devco was formed as a federal crown corporation, and contrary to the 1966 plan much expansion took place in the next 20 years. However, the expansion came at a cost to taxpayers as much of the development was subsidized by the government, a pattern that would continue for many years to come.

In 1989 there was hope that the government would finally approach Devco in a manner that encouraged the company to remain productive on its own power and relieve Canadians of the tax burden of supporting the company. The $30 million per year subsidy was to end in 1995 and after that point the company was expected to remain viable on its own.

Speaking of the development of Devco, on March 23, 1992, the Liberal member for Cape Breton—East Richmond, Mr. David Dingwall, stated that federally we conceived and implemented what was known as the Cape Breton Development Corporation to try to assist the diversification of the local economy and also in later years to try to provide alternatives to the use of coal in Cape Breton.

As the years passed it became more and more obvious that this simply would not happen. Like many other Liberal promises, this one too was little more than an empty election promise. The rhetoric seemed to have an end in sight with the 1989 announcement, yet like so many other government promises it never happened. Since 1996 a further $150 million has been provided to sustain Devco.

In the last 33 years, Devco has experienced many shutdowns, failures to meet production targets and stunning financial losses, including some serious roof cave-ins in one of the mines. In August of this year, Devco's annual report showed that it had one of its worst years on record, suffering a $299.7 million dollar loss.

Through the years, Devco has employed scores of hard-working, driven and responsible miners. It is certainly not their fault that Devco has proven to be such a disastrous example of a crown corporation. However, it is the miners and the Cape Breton community that are suffering from the abysmal lack of government action to ensure that the mine best serves those who support it and those that it supports.

In January 1999, it was announced that the government would take steps to privatize Devco, including two mines, an international pier, a railway, a coal wash plant and all surface operations. This announcement immediately raised howls of protest and despair from Cape Breton as mining is all many Cape Bretoners have ever known. Coal mining is to Cape Bretoners as oil and gas are to Albertans.

Remembering the effects of the cod moratorium in Newfoundland, Cape Bretoners are terrified that an entire industry, economy, lifestyle and culture are doomed to extinction. I sympathize with those concerns. I agree that all that is reasonable must be done to alleviate the difficulties that privatization will cause for the 1,100 miners and their families that are affected by this decision.

When one studies the long history of Devco, it becomes quite clear that Devco was primarily created for political purposes. From the beginning, the corporation was rife with political patronage and nepotism and certainly did not operate as a viable commercial venture might have done. The reality is that due to the ineffective management of Devco by the federal and provincial governments over the years, Devco is not and never will be a viable crown corporation. It is simply sucking millions of dollars in subsidies every year. Since 1967, the government has provided over $1.5 billion in subsidies. In all fairness, taxpayers cannot continue this kind of subsidization of Devco.

Bill C-11 starts the process of privatization by giving legislative authority for the sale of all, or substantially all, of Devco's assets. I am very pleased to see that there is an end in sight to the government's responsibility for Devco. The federal government should no more have been in the business of coal mining in Cape Breton than in the business of oil and gas in Alberta. These reserves of coal in Cape Breton and oil and gas in Alberta are under the exclusive jurisdiction and ownership of the provincial governments. The federal government should certainly not be interfering in those territories.

Yet what may not end is Canadian taxpayers losing out on the deal. As a crown corporation, all profits from the sale of company assets should return to public coffers. That is what should happen.

I am not convinced that that is what the government has in mind for this legislation. There are some very interesting holes in the bill that could be conveniently filled through more patronage and more Liberal back scratching.

For example, subclause 2(2) of the new bill calls for subsections 99(2) to 99(5) of the Financial Administration Act to not be applied to the disposal of Devco assets. I cannot help but wonder why it is that the FAA needs to be suspended for this sale to go through and, more important, what is going to replace those accountability controls that are provided for in the Financial Administration Act. The FAA ensures that a sale such as this happens in an open and accountable manner. If those restrictions are removed, what will control such issues as who gets the successful bid and did they pay a reasonable amount for the assets? Was the transaction made with best value for money interests? Will the money return to the public coffers?

Devco has historically been rife with patronage and nepotism. It is crucial that this last transaction be done properly, in an open, honest and accountable manner with the best interests of all Nova Scotians and all Canadians in mind, not just the Liberal interests.

Another concern I have is that currently only bidders and cabinet have access to the bidding process. No one else can get information about how much the assets are worth or, for that matter, what level of liability exists on those assets. How will we know if the final price is truly reflective of the value of the assets?

Not all of Devco's assets are no longer viable. The Donkin mine, the international pier and the railway system are all functional. After having invested millions of dollars over the past 30 years and, thanks to the government, never seeing any kind of economic return on this investment, I believe that Canadians at least deserve to know that Devco's death will not serve the same political purpose that its birth and life did.

Another concern of mine is that the government is proposing to entirely repeal section 17 of the original bill. This is the section under which the grievances have been filed and certainly around which most of the controversy exists. This section legislated that in the event of a mine shutdown or sale the government had to do everything in its power to mitigate the effects on miners and their families. Something must replace this protection for the workers and their families, but I cannot help but wonder why the government seeks to remove this clause. Is it concerned with ongoing lawsuits or does it just want to wash its hands of the entire mess regardless of the effects on Cape Breton?

Whatever the reasons, certainly it is reasonable for the unions, the miners and their families to expect the same kind of protection as long as some of the Devco empire still exists. If that protection was reasonable in the old act, it should continue to be reasonable in whatever replaces that old act until Devco and its assets no longer exist.

The Reform Party is very sensitive to the needs and fears of Devco families and certainly we do not want to cause them unnecessary hardship. However, the sale of Devco must take place if Nova Scotians are ever going to get out from under the control and dependency of the federal government.

Unfortunately there are a few complications that might make the sale difficult. For example, the accumulated liability of the company is estimated at around half a billion dollars. The majority of that liability comes from ongoing arbitration regarding workers compensation, severance payouts, as well as other workers' concerns as a result of section 17 of the old act. At least this element of the liability is known.

What is not known is what the environmental costs and liabilities may be in the future. Cleanup of the Devco site has been budgeted by Devco to cost $110 million. However, as with most things where the government is involved, the price tag will no doubt actually be much higher than that. One only has to look at the history of the Sydney Steel mills and the Sydney Tar Ponds to see the potential environmental liability could be much higher.

The successful buyer of Devco might not have to pay the liability as part of the deal and likely no one would bid on the Devco assets if that liability were to go with the assets of the company. Regardless of who buys the company, somebody will have to pay for the liability, whether it is the taxpayer or a private company. Inevitably it will be the federal government, which of course is the taxpayers of the country, that will be responsible for whatever the real liability of Devco will be.

As if past costs were not enough, the taxpayers will continue to be on the hook for many years to come. Bill C-11 addresses any future lawsuits against Devco and provides reassurances that regardless of the state of Devco the lawsuits will stand. However, instead of suing Devco, instead the government and therefore the taxpayers will pay the price. According to the bill, there is no finite end to this arrangement. Even though Devco may no longer exist, no doubt it will remain a fixture on the taxpayers chequebook for many years to come.

My sense is that Cape Bretoners and many maritimers are very concerned with what they see happening to their way of life. I do not blame them. It must be a terrible worry and a concern to see the industries and way of life that generations have come to know, appreciate and develop disappearing. I do not believe that the maritime economy and way of life needs to be put on the endangered list quite yet or that Atlantic Canadians need to depend on the largesse of the federal government in perpetuity.

The Reform Party is sympathetic to the concerns of maritimers and we believe that Atlantic Canadians are poised to take advantage of a rising economic tide. Rather than being caught in a whirlpool of discredited, backward-looking Liberal economic development policies that only pull maritimers down, Atlantic Canadians are looking toward a wave of economic and social progress based on new ideas and new politics.

This new direction represents the foundation of a new growth strategy for Atlantic Canada, a strategy that offers tax relief to the many instead of subsidies to the few. It includes new ways that are free of Liberal patronage and corruption to attract private as well as public capital to rebuild the east coast infrastructure, from ports, to airports, to short line railways, to shipyards, to highways both traditional and electronic.

It includes rebuilding the old trade routes to New England and across the Atlantic to Europe which free trade is now reopening. It includes getting the financial houses of the Atlantic provincial governments in order by throwing out patronage infected spend and tax regimes and replacing them with a government committed to controlling spending, balanced budgets, lowering taxes and paying down debt. It promotes the attractiveness of the east coast as a place in which to live and to raise families in combination with excellent education institutions as the foundation of the knowledge based industries of the 21st century.

I have been to the east coast many times and I have family there. My son lives in Nova Scotia and has for many years. My colleague, the hon. member for Okanagan—Shuswap, visited the Devco operation a number of times, went down in the mines and spent a lot of time with the unions that were involved in Devco and the shutdown. Therefore we do have some familiarity with the issues around Devco and around the economy of Cape Breton and Nova Scotia.

I have always said that if I was to choose a place to live in Canada, other than my native Alberta, it certainly would be the province of Nova Scotia. Its majestic beauty, its welcoming people and the resilient spirit of its citizens are characteristics of Atlantic Canada and certainly Nova Scotia. It is truly amazing that maritimers have managed to maintain their pride and dignity through years and years of Liberal and Conservative patronage and policies that give birth to that kind of government intervention.

The Reform Party believes that the efforts of Atlantic Canadians, not bureaucrats or politicians from the federal government, can and will revive the Atlantic economy.

This bill is a starting place to begin giving over control of the economy to Atlantic Canadians and away from the Liberal government's greedy hold on an enterprise that was never meant to be profitable. If it had been economical, Nova Scotians would have developed the project successfully. From the beginning, it was simply an exercise for the Liberals to win votes; votes won at the cost of the well-being and economic stability of an entire community. So much for responsible government.

On March 23, 1992 the Liberal member for Cape Breton—East Richmond, Mr. Dingwall, argued against the privatization of Devco. I think the following quote gives some idea of the mentality of Liberal thinking in that part of Canada. He said:

—to privatize Devco, to give it to his friends—that kind of (an) individual to come in and be the sole operator of a coal mine, to strip it down to sell off its best parts and make a million dollars or more and then walk away from it in five years, is privatization which I would never support.

Perhaps the Liberals have changed their definition of privatization since then, but in my mind it is exactly the kind of action that the Liberal member described that we are facing without stricter controls in the legislation.

I cannot support the bill as it exists now because although I agree that Devco must be privatized, it must happen responsibly with open, honest and accountable procedures. Until changes are made to the bill to ensure an accountable process, I cannot support the bill and I urge other members of the House to do the same.

[Agriculture, November 3rd, 1999]

Mr. Speaker, farm families in northern Alberta are suffering terribly because of this summer's extreme drought conditions.

Many of the municipalities in the province of Alberta have declared this region a disaster area. This should qualify affected drought areas for federal tax deferral on the sale of breeding livestock.

The federal minister of agriculture responded by recommending to the finance minister that he approve tax deferral for farmers affected by the drought. The finance minister must be just too interested in spending his multibillion dollar EI surplus to notice the troubles of farmers. So far there has been no response.

These farmers have suffered enough hardship. The very least the finance minister could do is step up and help these farmers by giving them desperately needed access to the tax deferment provision.

[Aboriginal Affairs, October 26th, 1999]

Mr. Speaker, that hardly constituted an answer to my question.

Section 92(a) of the Canadian constitution clearly gives provincial ownership and rights to manage natural resources. In the minister's opinion, which takes precedence: the constitutional right of the provinces, or a 239 year old numbered treaty that was struck before Canada even existed?

[Aboriginal Affairs, October 26th, 1999]

Mr. Speaker, natives have now resumed logging on provincial crown land based on the Marshall decision.

Would the minister of Indian affairs please clarify for the House whether, in his opinion, the Marshall decision gives aboriginals the right to log on crown land, yes or no?

[Petitions, October 26th, 1999]

Mr. Speaker, I present a petition today on behalf of members of my constituency and many Albertans.

The petitioners would like to express their astonishment at the legal determination that possession of child pornography is not criminal. They feel that the very existence of child pornography is ample evidence that a criminal act has been committed against a child. They want to express that opinion.

[Natural Gas, June 4th, 1999]

Madam Speaker, I am pleased to rise to speak to private member's Motion No. 292. I support the principle which the member speaks of, but the initiative is perhaps somewhat misplaced in that this motion proposes that the federal government provide the delivery of natural gas to rural regions in Canada. While I can accept that the federal government would and should make a contribution to the process, the provision of public utilities falls under the responsibility of provincial and municipal governments. As well, there are existing federal programs which might apply to this kind of program. Accordingly, I do not support this motion for the simple reason that it brings federal interference into an issue of provincial jurisdiction.

Many provinces already have in place programs to address the intention of this bill, to deliver natural gas to unserviced regions. I will quickly go over an example of such a program in my province of Alberta. Alberta has had just such a program and has been helping Albertans since 1973.

The natural gas distribution system serving rural Albertans began in the early 1960s with small systems built and operated by local groups and co-operatives. Interest in natural gas services grew throughout the decade. In the early 1970s the provincial government took action to expand the provision for natural gas to rural Albertans at a reasonable cost. This action was taken in accord with the general conclusion that it was in the public interest to improve the economic viability of smaller centres and that the family farm should be preserved.

It was felt that all Albertans, including those in rural Alberta, deserved a fair share of the benefits enjoyed by the people of that province from the ownership of natural resources and the revenue that flows from the development of those natural resources.

Because of the higher cost of serving scattered rural areas, it was decided that a provincial funding program to support construction of rural gas distribution systems was needed. To support this initiative the rural gas act was enacted in 1973 and soon after the rural gas program administered by the rural utilities branch of Alberta Energy was established.

This program brought many benefits to program users. The primary benefits included affordable installation costs where adequate gas sources are available, lower costs and reliability of fuel supply. Obviously all these benefits are crucially important to those living in rural areas.

Under this program approximately 4,000 new rural gas services are installed each year. Eligible services include uses such as homes, outbuildings, irrigation, grain drying, poultry and hog barns, greenhouses and more. Until this program was established individuals simply could not afford to access gas distribution in rural areas past already established transmission lines.

However, this program attempts to reduce consumer costs to a reasonable level by establishing a grant program under which participating utilities could receive grants based on a cost sharing formula from the provincial government. Under this arrangement consumers in the same class pay the same contract amount in any year, even though the costs to provide the service may vary widely.

Funding for the new gas installation is based on a formula that calculates the pooled costs per service within each franchise area. For example, for a rural installation service that has a capital cost of up to $2,600, the capital cost is shared 100% between the distributor and the customer. However, for a rural installation that costs above $2,600 and up to $15,000, the distributor or consumer covers 25% of the cost and 75% is covered by the provincial grant. With this formula a typical farm installation costing $5,000 would receive a grant of $1,800. Obviously this makes the convenience of natural gas much more affordable to those living in rural areas.

There are a number of factors that contribute to the success of the rural gas program. First, with the expansion of natural gas services into rural areas, a new system of franchising had to be created to focus on the special requirements of rural areas. This concept of franchise areas was applied in the rural gas act to ensure a customer base for future viability of the new distributors.

Other criteria included consideration of major obstacles to pipeline construction such as rivers or highways. Under an assigned franchise a distributor has the right and responsibility to offer service where economically feasible to all potential rural and urban residential customers who did not have natural gas service prior to 1973.

Second is the formation of member owned co-operatives in the less populated areas of the province. The provincial government recognized the dedication, initiative and independent spirit of rural dwellers and felt the program had a better chance of success in these areas if the local community controlled its own destiny. Where have we heard that statement before?

Third is the provision of grant funding on a cost shared basis to make rural gas systems economically viable. Through contributions by the customer, government and co-ops, the resulting gas rates could be competitive with urban rates.

Finally, Gas Alberta was established to negotiate price and arrange for gas supplies for the co-ops. Through a postage stamp wholesale rate throughout the province, all co-ops were on an equal footing with respect to gas costs.

The rural gas program has been very successful in Alberta. To March 31, 1999, services have been provided or systems upgraded for over 171,600 rural, urban, irrigation, grain dryer services by over 90 distributors throughout a network of pipelines totalling 116,521 kilometres.

The point I make by referring to the Alberta example is that obviously programs such as those proposed by the motion already function and are doing well under provincial jurisdiction. As well, keeping in mind it is the province that collects royalties from the export of natural gas and oil, the provinces already have a built in funding system without asking Canadian taxpayers to unnecessarily subsidize a rural gas installation program.

The Reform Party supports the principle that the provinces should have exclusive jurisdiction over natural resources and that citizens of the provinces should all benefit from the development of those resources.

Alberta is not the only province that receives substantial royalty income from the sale of natural gas. The province of Saskatchewan received $44.5 million last year in natural gas revenue. It would seem reasonable to me that all the residents of Saskatchewan, even those in remote northern communities, should benefit from the development of natural gas resources as much as any other province.

However, the prime responsibility for making that happen lies first with the local community and second with the province. Third, there is room for federal participation through existing programs such as the PFRA or prairie farm rehabilitation program.

For all these reasons I will not support the motion and I would encourage other members of the House to do the same.