Mr. Low:

I know that it has never been entered into by the dominion government. Let me ask this question. Was that agreement not drafted by a representative of the government of the province of Alberta sitting with a representative of the federal government?

Mr. Gardiner:

No, it was not.

Mr. Low:

That is my information. I would like the minister to answer the question.

Mr. Gardiner:

The question asked by the leader of the Social Credit party is a fair one and I shall try to give him a fair answer. There have been no, what are called, large irrigation projects undertaken up to date in western Canada. The policy with regard to large irrigation projects has not yet been established as between the dominion government and the provincial governments, but some few years ago the United States took the position that unless we were going to utilize the water in the St. Mary river they would probably use it. The members of the water development committee did say at that time that they thought these waters ought to be conserved in Canada, and because of this decision something ought to be done toward conserving them. Discussion started as between the government of Alberta and the government of Canada. No agreement was reached with regard to the matter. But the Canadian government took this position, that farmers could not remain on lands in Alberta, or in any other part of western Canada, if they had to pay what amounted in costs to more than $10 an acre of the lands that were going to be irrigated. Therefore they said that if it was going to cost say $40 an acre or $50 an acre to put in the works that made it possible to have the land irrigated, then the farmer himself could not pay the amount and at the same time pay his water charges and pay the taxes on his land and all the costs of operation. Therefore somebody ought to do something about establishing the capital works.

We said that we were prepared to put in the main dam. In other words we were prepared to establish the storage in the St. 'Mary river and thus start to utilize waters which otherwise might have been taken into the United States. When we said that, the

provincial government asked us not only to build the dam in the St. Mary river but to build the storage at Pothole which is a small lake that forms the storage and is about thirty-five miles from the main dam. They asked us to pay at least some part of the cost of digging the ditch from the main dam to Pothole, some thirty-five miles, and then to pay some part of the cost of Pothole as a secondary storage. We said that we were not prepared to discuss the question as to where the division of costs should end, but that we would go ahead with the construction of the dam in order to maintain the position in relation to the United States.

As has been said, the costs that we are going to be put to there will run up toward $20 million before we are through. We have spent about $5 million. At that time the province said that they were prepared to pay the cost of Pothole and Pothole has been constructed and paid for by the provincial government; but they agreed to pay the cost of Pothole conditionally upon the federal government entering into an agreement later on to pay some part of the costs at least as far as Pothole.

Mr. Low:

To make that a part of the big project.

Mr. Gardiner:

To make that a part of the original project which was not to be capitalized on the land itself. The undertaking given was that whatever arrangement was made dnally with regard to the works between the main dam and Pothole or beyond Pothole was to apply to Pothole itself. So that the present position is that the provincial government has paid for Pothole, and we have paid for all the works on the main dam, and regotiations are still continuing with regard ;o the other matters.

The document which has been sent down aere relating to the construction of works, laving to do with the St. Mary dam, is a locument which provides for very extensive expenditures over a very extensive program. The agreement reached between the provincial government and the federal government some two years ago in the offices at Sdmonton, when I myself was there, was to .he effect that whatever principles we were joing to follow in other large projects in western Canada would be established in *elation to the construction of the St. Mary lam and any lands which were irrigated :rom that dam.

That is the general agreement that was altered into by word of mouth-it is not in writing, although it may be in some letters which have passed. But it was an agreement *eached through discussion, namely that whatever arrangements were finally made with regard to the division of costs in con-45781-49

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nection with the St. Mary dam and the waters stored there would be followed in particular in connection with other large projects.

In answer to the direct question: "Has any agreement on the question been signed", the answer is no. I accept the document which was sent here by the provincial government, drawn up on the basis upon which they thought payments ought to be made and in that document-

Mr. Low:

Is that correct? Is it correct, in view of the fact that your own representatives assisted in the drafting of that document?

Mr. Gardiner:

I understand that the provincial government applied to our office, as the only source from which information could be obtained, for all of the engineering information with regard to the project. And, basing their conclusions upon the information thus obtained, they asked that certain things be done, and wrote them into the form of what they would like to see under an agreement, and have sent it down to Ottawa.

Mr. Low:

Just at that point-and I am only asking for information, because we have to clarify this matter-is it not true that at the time that document was sent, or just after that, you told the people in Alberta that you could not very well enter into any agreement or attempt to sign an agreement until the election was over?

Mr. Gardiner:

What is that?

Mr. Low:

Is it not true that you told people in Alberta, with respect to this very agreement we are talking about, that you could not attempt to enter into any such agreement until after the election?

Mr. Gardiner:

No, I did not tell them that. They may have assumed from the discussion that probably we would not; but I did not at any time tell them that. I am quite sure that, if I had entered into any agreement while the election was on, the speech made by the hon. member for Medicine Hat with regard to what was said there would be mild when compared with what my hon. friends would be saying. I certainly did not enter into any undertaking to make any agreement with them immediately preceding the election; and I would not have done so, even if I had been in a position to do so-which I was not.

And I am not in a position to sign any agreement with them yet. The reason is that the document which has been submitted to us asks that we not only foot all the bills for the St. Mary dam, and all the bills for Pothole, but that we assume all the expenditures for storage at Ridge, and all the storage at

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Chin and all the storage at Horsefly, over to the southwest of Medicine Hat; and that we assume all the cost of digging all the ditches to connect all these storages.

They say, "If you will do all that, then we under our act will do certain things." The hon. member for Moose Jaw says, "Whose obligation is it?" Well, I was minister of highways in the Saskatchewan government for five years, and while I talked about irrigation I was not talking about anybody at Ottawa doing the job of irrigation. I was talking about my own department doing it. When I was minister of highways we had an irrigation act. We have not an irrigation act here; irrigation acts are on the statute books of provincial legislatures.

So the Alberta government asks us to do all the work to deliver the water right to the door of the farmer-and when I refer to the door of the farmer I refer to the point where the farmer takes the water out of the main ditch. They say, "If you will do that, then under our irrigation act we will organize the farmers into irrigation districts, and we will finance the construction of work in those areas, and then we will turn around and charge the farmer for the cost that we put up."

What we say in regard to that is this, that the provincial government ought to share some of the capital cost, which reduces the total cost per acre from some $40 or $50 down to the $10 that the farmer can pay, and that no part of that money ought to be collected back from the farmer. We say the federal government should put up something and the provincial government should put up something; and whatever that amount is, it should be charged up to the capital cost which the farmer is not going to be required to pay, in order that his costs may be reduced down to the $10.

My personal opinion about that is that when you take all the works for which we are responsible, including the original dam, we would be assuming far more than our total responsibility, whatever that responsibility might be based upon, whether it is a legal responsibility or a national responsibility. We would not be very far from the mark if the provincial government became responsible for half of the cost and the federal government became responsible for the other half.

Mr. Thatcher:

Does the minister suggest that for the south Saskatchewan project, also?

Mr. Gardiner:

I have told my hon. friend that whatever we finally decide with the Alberta government as being the principle

to be applied will be applied to all of them. The difference between the project in Alberta and the project on the south Saskatchewan river is that back beyond the St. Mary storage there is another storage known as the Water-ton lakes. Only today in our city of Ottawa the international joint commission held a hearing to decide the question as to whether that water belongs to the United States or to Canada, and certain findings were made with regard to it.

I do not know what those findings were, because the document is not yet made public. It will probably be out in a day or two. In any case, they have been deciding the question as to what part of that water belongs to Canada and what part belongs to the United States. A ditch about two or three times as long as the one between the St. Mary dam and Pothole would have to be constructed to take the water from Waterton lake to St. Mary dam. That water again would be required before you could irrigate the 500,000 acres of land extending east from Lethbridge upon which water can be placed-if we can get enough water to irrigate it.

As we go along, when once the federal government has entered into an agreement with regard to St. Mary, the same principles would apply with regard to the other storages. I do not know how many years it will take to do one job; but the position we are taking is that we should establish a principle on the basis of whatever we are going to do at St. Mary, and apply those principles to the other projects. That is the present position in relation to it. I do not know whether I have answered the questions asked.

Mr. Low:

I wish to thank the minister for travelling forty-five miles when he could have answered the question by a simple yes or no. I quite realize however that it was difficult for him to answer yes or no, and to give a proper impression. Now-

Mr. Gardiner:

That is why you would like me to say yes or no.

Mr. Low:

I simply asked the question whether you had or had not signed the agreement.

Mr. Gardiner:

But my hon. friend should realize this, that there is not any agreement to sign.

Mr. Low:

That is right.

Mr. Gardiner:

When there is an agreement we will certainly sign it, but there is not any agreement to sign.