Mr. Higgins:

Screech is quite right.

Now, Mr. Speaker, deficits of this size may seem very small to you who are accustomed to dealing in large sums. I would imagine that a deficit of $5 million is merely chicken feed to many of the provinces up here. I can assure you, however, that a $5 million deficit for the province of Newfoundland-if that is what it amounts to and I sincerely hope it does not-is something frightening.

During the negotiations with the second delegation from Newfoundland in 1948 a memorandum was issued by the government in which it was stated that an effort would be made to make the amount of surplus sterling held by Newfoundland available to Newfoundland in dollars within one year after the date of union. This was money that had been on deposit in England and, so far as we were concerned, was blocked sterling. We were rather doubtful of obtaining it. Quite recently I was informed that the government of Canada has made this blocked sterling available to the province. I sincerely hope that is true, because we shall certainly need all the money we can get this year to enable us to carry on and handle our unemployment problem. Only today I was informed that the United States bases in Newfoundland have paid off 600 people. Those 600 people are now on the list of unemployed. Again, the number may seem small to hon. members but it is by no means small to us.

I should like you to understand that, as a result of confederation, our secondary industries have been hit very hard. It is problematical whether our clothing factories, our breweries, foundries, tobacco factory, paint factory and the rope manufacturing plant will be able to withstand the competition from the mainland. If that happens, Mr. Speaker, it will have serious repercussions not only in the districts represented by the hon. member for St. John's West (Mr. Browne) and myself, but in the entire country. I hope that, in accordance with the terms of the agreement, some form of assistance will be rendered to the secondary industries by some government

The Address-Mr. Higgins intervention. I do not know how it can be done, but if it can be done it will be a wonderful thing for industry. Now, Mr. Speaker ana hon. members, do not for a minute think that we Newfoundlanders are coming to you with our hat in our hand begging you for assistance. That is not so. I merely wish to point out to you that at some future date the federal government will be faced with the problem of making additional grants available to Newfoundland, so that she will be able to maintain her place as a member in equal standing with the other provinces of this great dominion. By the terms of confederation we have given to Canada full value, and in the future still greater value will be obtained from the assets we have turned over. I may add that I am not at all unmindful of the splendid services that have come to Newfoundland and of the cost of those services to Canada. But bearing all that in mind, I still say that we have given good value and will continue to do so.

For the benefit of some hon. members who may not be fully aware of what Newfoundland turned over to Canada in real property, I am just going to go through the list quickly for you so that you will have a slight idea of what you obtained for your money and what you will continue to get. First, there is the Newfoundland railway, including rights of way, wharves, dry docks and other real property, rolling stock, equipment, ships, and other property. That means that the whole railway system together with all our ships have been turned over to the federal government. A great many jokes have been made about our railway, many funny stories have been told about it and many funny verses have been sung; but I can assure hon. members that, as far as we in Newfoundland are concerned, our railway system is still first-class. At the time of our pre-confederation talks that item alone was valued by the officials of the railway at $70 million. You have also obtained-and I may say that this is not an auction sale; I am merely repeating the things we have sold-the Newfoundland airport at Gander, including buildings and equipment, together with any other property used for the operation of the airport; the Newfoundland hotel; public harbours, wharves, breakwaters and aids to navigation; bait depots and the motor vessel Malakoff; military and naval property, stores and equipment; public dredges; the public telecommunication system, including rights of way, land lines, cables, telephones, radio stations; real and personal property of the Broadcasting Corporation of Newfoundland; and customs houses and post offices. In actual property value, all that represents an extremely large sum of money. It has been

The Address-Mr. Higgins suggested that you are taking over dead property, but that is far from the case. I will not give you any real value because I cannot do so, but you can be quite sure that it is in the hundreds of millions of dollars. I put it to you that if Newfoundland went into confederation as a province and these services were not there, they would have to be provided by Canada. You are now taking over or have taken over a going concern. All we ask is that it be kept going.

In the speech from the throne, reference was made to the new air agreements between Canada, the United Kingdom and the United States. I believe those agreements have been concluded. That is my understanding from the contents of the speech from the throne. I hope it is so. I understand that additional traffic stops in the United States and in the United Kingdom have been provided for Trans-Canada Air Lines. I speak without full knowledge of the facts, but from the information I have gathered the chief factor in the making of those agreements was the fact that Canada now controls Gander airport and Goose airport-Gander especially- which enabled Canada to bargain with the United Kingdom and with the United States and get the wonderful advantages she has obtained for our Trans-Canada Air Lines. When I speak of the value of Gander in this way I am speaking simply of the commercial value. But do not ever forget the strategic value in time of war of that great airport at Gander, of that great airport at Goose, of that other airport at Harmon field and of that other airport at Torbay; and do not ever forget that the beginning of the winning of the" battle of the Atlantic took place right from our little island of Newfoundland.

There are seven major international air lines operating from Gander at the present time, namely Pan American Airways, TransWorld Airways, American Overseas Air Lines, British Overseas Airways, KOM of Holland and Sabena of Belgium, the Scandinavian Air Line System and of course Trans-Canada Air Lines. I believe there are also some five or six non-scheduled carriers operating out of Gander as well. This has meant regular employment for a considerable number of my fellow countrymen, and I sincerely hope that nothing will be allowed to interfere with the operations at Gander, as was stated recently by the chairman of the air transport board prior to the conclusion of these air agreements. If these United States air lines are refused permission to land at Gander or if their operations are in any way interfered with, it will be an extremely serious matter tor a great number of Newfoundlanders employed there.

In addition, to further increase the earning power of this dominion we bring you our great fisheries, which, added to your own, will probably increase their value by one-third. The Minister of Fisheries (Mr. May-hew) will probably remember the figure. Incidentally, for the benefit of hon. members from Cape Breton, I should like to quote to you an extract I read in a book issued by the food and agricultural organization of the United Nations entitled "Salted Cod and Related Species". The quotation is as follows:

The east coast fisheries of Canada, which are the only Canadian fisheries of importance to the salted fish trade, began in the early days, when Cabot voyaged to Newfoundland in 1497 and Jacques Cartier to Canada in 1534.

I presume the hon. members from Cape Breton are still interested in the landfall of Cabot. If so, that should settle the issue for all time. But, Mr. Speaker, the chief value of our fisheries in the present money crisis is in the fish that we ship to the United States. The great bulk of our fresh-frozen fish goes to the United States and of course payment is made in United States currency.

In connection with the fisheries, by the terms of union our fishery laws and our Newfoundland fisheries board are to continue for a period of five years. That is five years certain, and thereafter until changed by the parliament of Canada. I would like you to understand that the fisheries board is doing excellent work, and has since its inception, and I sincerely hope that no change will be made in its constitution in the future. I know that the chairman of the board, Mr. Raymond Gushue, has the full confidence of all the people of our country, and I understand that he is just as highly regarded by the chief officials of the fisheries department at Ottawa.

Included also in the assets which we bring to you are our pulp and paper industries, our two great mills situated at Corner Brook and Grand Falls. In Corner Brook some 7,500 permanent and seasonal workmen are employed and the annual pay roll approximates $14 million. The annual productive capacity of the mills at Corner Brook is 300,000 tons of newsprint and 54 thousand tons of sulphite pulp. I have not the figures for the mills at Grand Falls but I understand they are somewhat lower. However, the annual turnout for both mills in 1948 was 382,000 tons, Newfoundland being the third in the list of countries producing newsprint, being exceeded only by the United States and by Canada herself. The largest percentage of our newsprint is being sold to the United States and of course being paid for in United States currency. This is another fine asset that we bring to you.

I should also like to draw to your attention the great possibilities of our territory of Labrador. We have down there iron ore, forests and one of the greatest waterfalls in the world. No accurate estimate of the timber resources of Labrador has been prepared as yet to my knowledge, but from what knowledge I have been able to gather it would appear that there is a considerable quantity of first-class standing timber in Labrador at the present time, and quite ample in amount to operate another pulp and paper mill. Labrador is also the location of Grand falls, which has been estimated to make possible a hydroelectric development of better than a million horsepower. Our iron ore in Labrador is of extremely high quality, and all reports to date indicate a very large body. As hon. members know, plans are being made now to put a railway in from the Quebec side to connect with the Quebec body of ore and to operate that body and the body in Labrador at the same time, I believe.

The issue of the Financial Post of September 17 makes reference to Labrador iron, and the paper states that Republic Steel, Armco, Inland and Wheeling Steel, U.S. Steel and Bethlehem Steel are classed as being interested. The paper states also that production is thought to be five years away, but it is said to be no longer a guess that United States steel companies will be taking a share of it. Those of you who follow iron ore must know that the Mesabi range is very closely approaching the exhaustion point, so you can see the value of these deposits of iron ore in northern Quebec and Labrador and the great value it should be to all of the dominion in the years to come. I shall make a further reference to a particular aspect of Labrador in connection with the supreme court bill which is to come up again shortly.

Apart from the Labrador possibilities we have three other mines in operation. We have an iron mine situated at Bell Island in my own constituency, which has been in operation since I believe the beginning of the century. It is owned by Dosco, and the great bulk of the iron ore is now being used at Sydney. Prior to the war a great deal of it used to be shipped to Germany. In fact, before both world wars Germany received a considerable quantity of that ore. There is also our very valuable lead, zinc, copper mine situated at Buchans. This mine is being operated by a subsidiary of American Smelters and possesses a very high grade ore. The only other mine in active operation at the present time is a fluorspar mine at St. Lawrence, which is also being operated by another United States company. We have also other great possibilities for various industries in the future because, Mr. Speaker,

The Address-Mr. Higgins we have a country that is as yet unspoiled, a country that we say will be a mecca for tourists. All that we need is proper tourist facilities and of course adequate means by which tourists may get into the country in the cheapest possible manner and with the least inconvenience to themselves, and that of course is by road. But we have to cross that little narrow neck from Sydney to Port aux Basques. We hope and trust that as soon as a trans-insular road is completed a proper ship will be put on the gulf so that a tourist can drive in with his car in comfort and drive out in equal comfort when he gets to our little island. The provision of a suitable ship is part of the terms of confederation. I am merely reminding hon. members and the government so that they will not forget.

These are some of the assets that we bring to you. These are the visible assets. The asset of which we are most proud, the asset of which I am sure all Newfoundland members in this house are most proud, is that we bring to you provinces and to you representatives of the provinces of this great dominion 328,000 people who are the salt of the earth, people who are independent, people who are going to make first-class Canadians.

I went into this matter somewhat in detail to show you that we did not come to vou with empty hands. We are still a puor country, and poorer in the thing known as money-but in everything else we are wealthy. In money we are poor, and we are not able to enjoy the standards of living which you in the rest of Canada can enjoy at the present time. I would therefore ask all hon. members from all parts of the house when the time arrives, as it must, when a request is made that the financial terms of confederation with Newfoundland be revised upward, that you will all give it your favourable consideration.

I should like to refer to the terms of union which deal with this subject. Section 29 states that:

In view of the difficulty of predicting with sufficient accuracy the financial consequences to Newfoundland of becoming a province of Canada, the government of Canada will appoint a royal commission within eight years from the date of union to review the financial position of the province of Newfoundland and to recommend the form and scale of additional financial assistance, if any, that may be required by the government of the province of Newfoundland to enable it to continue public services at the levels and standards reached subsequent to the date of union, without resorting to taxation more burdensome, having regard to capacity to pay, than that obtaining generally in the region comprising the maritime provinces of Nova Scotia, New Brunswick, and Prince Edward Island.

All I can say is that if we in Newfoundland have to wait for eight years before the terms of this agreement are going to be considered,

The Address-Mr. Higgins then the best illustration I can give you is to tell an old political story which has been told in Newfoundland for many years. A member of the government was addressing his constituents, and said to them, "When this government came into power you were groaning under taxation. How are you now?" A voice came from the back of the hall, "We are too 'wake' to groan." I hope this will not be let go so long that we in Newfoundland will be too weak to groan about having a revision of this union of our province with Canada.

Mr. G. F. Higgins (St. John's East):

Mr. Speaker, following the eloquence of the hon. members who have spoken today, and the broad scope of their addresses, I feel somewhat diffident in speaking to you tonight on matters chiefly concerning my own province. Nevertheless, as our problems in Newfoundland are now the problems of all of Canada, I feel it only fitting that you should acquire all the knowledge you can of our particular worries and fears.

In speaking on the address I should like to join my colleague, the hon. member for St. John's West (Mr, Browne), in expressing thanks to all those members on both sides of the house with whom I have come in contact for their many courtesies to me and I am sure to all other Newfoundlanders in this house. I wish to offer my congratulations to you, Mr. Speaker, on your elevation to the high position which is now yours.

I should also like to compliment the mover (Mr. Boisvert) and the seconder (Mr. Laing) of the address in reply to the speech from the throne on the real excellence of their addresses. I should like to offer my congratulations to the Prime Minister (Mr. St. Laurent) on the results of the election. Whilst the ridings of St. John's West and St. John's East did not follow the other ridings of Newfoundland in supporting the party which he has the honour to lead, nevertheless I can assure him of a very warm welcome when, as I hope he will, he returns to visit us again in Newfoundland. I may add that we are eagerly looking forward to a return visit from the leader of the opposition (Mr. Drew). As you might well expect, he created a most favourable impression on his visit to our province.

I am afraid I must apologize to the leader of the C.C.F. party (Mr. Coldwell) for the somewhat unusual lack of warmth displayed to him on his visit to St. John's; but speaking for my own riding, which was the only riding contested by his party, I should like him to know that there was nothing personal in the lack of warmth, but merely that he had no opportunity to explain properly the doctrines of his party to our people. I can assure him that he will receive a warm welcome when and if, as I hope he will, he decides to come and see us again.

The Address-Mr. Higgins

The leader of the Social Credit party (Mr. Low) did not visit us, but if he decides to do so I can assure him also that he will be very welcome. I suggest to him, however-and I hope he will not take it amiss-that before doing so he should learn to pronounce the word "Newfoundland", because some of us regard its pronunciation as being quite important. I suggest not only to the leader of that party but also to many hon. members of the house that the simplest way to remember how to pronounce it is if you use it in the context, "you must understand new found land". I think you will find it somewhat easier that way. I do not object, I may say, to "newfundland" provided there is a possibility of our acquiring some new fund that we have not any knowledge of as yet. I can assure you it will be very welcome. I particularly stress that because of the financial gale we are going to have to weather very shortly. A new fund will have to be provided from some kindly people somewhere. Possibly the members of the government may feel inclined that way.

It was stated in the speech from the throne that, with the admission of Newfoundland, the Canadian nation attained the geographical limits planned for it by the fathers of confederation. I am very happy to know that Newfoundland made this contribution, that as a result Canada is now a complete and full nation, and I presume has no further territorial ambitions. As to the new province I have a few pertinent remarks to make, which I hope will not be misconstrued. First and foremost, let me say that the confederation of our country with the other provinces of the great dominion has now been accepted generally even by those of us who were not in favour of it. I say that quite frankly. I was one of those who fought confederation as hard as I could and right to the bitter end. My presence here is ample proof of what I say, that it has now been accepted generally by the people all over Newfoundland.

A number of my fellow Newfoundlanders were not in favour of confederation, and I may add that the number was not inconsiderable. The voting at the referendum showed that 71,334 people voted for the restoration of responsible government, and 78,323 for confederation. The chief reason among the great number of the people of Newfoundland who were opposed was that the financial terms of the confederation agreement were not adequate. As the Prime Minister will recall, during the meetings of the delegation from the national convention with the special committee of the cabinet in 1947 I raised this particular point. Subsequently on the visit of the second delegation, following the acceptance by vote of confederation, the

financial terms were somewhat increased, but they are still inadequate, and are not sufficient to enable us as a province to pay our own way in respect to government services.

Now, this fact has been borne out by the record of revenues for the months of April to August of the present year. I speak of the official record issued by the Department of Finance. The total revenue, including federal grants and income tax payments for the year 1948-of course the income tax payments are non-recurring-amounts to $15,556,997. Of this sum $8,450,270 was for income tax payments for that year. As I said before, they are non-recurring. The proposed tax rental agreement to be signed by our province and the government will give us approximately $6,800,000 per year, possibly a little more, but that is as close as I can come to it at the present time.

The total expenditure for the same period under review, namely, April to August, amounted to $10,735,780. Deducting the amount received from income taxes from the total receipts, it leaves an amount of $7,106,727. This leaves a debit balance of $3,629,053 for a period of five months, or a debit of some $725,000 per month. If the debit continues for twelve months at the same rate it will amount to approximately $9 million. As I said before, we shall receive from the tax rental agreement approximately $6,800,000. This will leave us with a debit, based on present expenditures for the first year of confederation, of something over $2 million. Remember this is only with present expenditures. The additional cost of our health services and the maintenance of our new sanatorium at Corner Brook will have to be added. This sanatorium is as modern as any on this side of the water. Apart from that maintenance and the original capital cost of the other planned extensions in our health services, there is also to be considered the cost of highroads.

In this connection, I trust that the recent statement made by the premier of Newfoundland, the Hon. Mr. Smallwood, will not be carried into effect. Mr. Smallwood stated that he proposed using the pick and shovel for the building of the highroads. That may be a perfectly good way to distribute relief, but to me it appears to be going back to the old days in road making.

The cost of providing relief in Newfoundland during the winter will also be high. It has been estimated for me that for the full year we shall very likely have an over-all deficit of approximately $5,000,000, so it will be necessary for new taxes to be imposed by the provincial government. As you can well realize, this is going to be an extremely difficult matter during the coming year, since we

are already beginning to feel what our United States friends call a recession. I should like to point out to you also that this debit balance has been incurred at a time of the year when we have comparatively little in the way of relief payments to make. In today's press I noticed an item to the effect that the price of liquor in Newfoundland has been increased by 50 cents a bottle. It is terrible. I trust some of my friends who buy a liquor known as "screech", who formerly paid $2.50 for their bottle of "screech", when they come to pay $3 for it-

Mr. Higgins:

Thank you; I appreciate that. Then, turning to that part of the speech from the throne which deals with the amendment to the Supreme Court Act, let me say I hope it is not the intention that in abolishing appeals to the privy council former decisions of that body will not be followed. I have reason to believe that a prominent member of the judiciary in Canada made a statement this year indicating that it might be so. I hope it is not so, because that very important and historic case, the Labrador boundary case, in which a decision was given respecting the boundary between Quebec and the present province of Newfoundland, is most important to us. The issue of that case was the ownership of Labrador. As hon. members recall, the decision of the privy council gave the great part of Labrador to Newfoundland.

In view of the statement made this year by the premier of Quebec that he intends to reopen the decision in that particular case, it is most important that some provision be secured in the bill whereby the rights of the province of Newfoundland to Labrador will be secured. I shall not say anything further on that matter at this time.

In the speech from the throne notice is given of a proposed bill respecting assistance to the shipbuilding industry and merchant shipping. In this connection I would draw the attention of hon. members to the unfortunate situation of Newfoundland seamen who served in Newfoundland ships during the war. As you may be aware, Canadian merchant seamen serving in the war years were paid a bonus of 10 per cent of their wages at the end of their period of service. Our merchant seamen who went through the same risk-and you will recall the torpedoing of the Caribou between North Sydney and Port aux Basques, and the consequent great loss of life-are refused that payment on the

ground that they were not members of the manning pool. Well, that is perfectly in order; but-and I speak now as president of the Newfoundland seamen's association-if I have to go back to the members of the union of which I have the honour to be president and tell them that because they were not members of the manning pool the government will not pay them these moneys, it is going to be extremely difficult to explain it to them.

I notice, too, the proposed legislation with respect to the trans-Canada highway. I hope and trust that Newfoundland will be able to participate in that. I hope also that the contribution by the provinces will not be based upon a flat rate but rather on the work to be done and on the ability of a province to make a contribution. Otherwise, if we are all going to have to pay a flat rate, I am afraid the contribution from Newfoundland will be more than we can meet.

With these few remarks I shall close, thanking the house for its patience and courtesy in listening to me.

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