18th Annual Premiers Conference, Communique, The Economy (18-19 August 1977)

Document Information

Date: 1977-08-18
By: Allan Blakeney (Saskatchewan)
Citation: 18th Annual Premiers Conference, Communique, The Economy, Doc 850-8/023 (St. Andrews: 18-19 August 1977).
Other formats: Click here to view the original document (PDF).

DOCUMENT: 850-8/ O23
(August 18, 19
St. Andrews, N.B.
August 18-19, 1977

The Provincial Premiers agreed that unemployment in
Canada at its present level is unacceptable. Forecasts of
continuing high unemployment rates for at least the next
eighteen months were a source of grave concern. The Premiers
deplored the waste of human talents and the economic loss to
Canada resulting from high unemployment.
The Premiers emphasized that actions to combat
unemployment in the short-term must not result in a worsenin%
of Canada’s longer term economic development prospects. Bot
short-term and long term measures were agreed to be of
immediate necessity if a significant reduction in unemployment
rates is to be achieved.
For the short run, the Premiers discussed a number
of actions including:
l. Tax cuts to improve consumer purchasing power and utilize exist
ing industrial capacity. Examples might include a general
federal personal income tax cut, and related measures.
2. Action to ensure that housing construction is speeded up,
either through tax measures, accelerated government
procedures or increased funding.
3. Re-introduction of the federal forgiveable capital loan
The Premiers discussions covered energy and trans-
portation. They agreed that a Canadian energy situation that
required immediate attention was the development of hydro
resources. They felt strongly that it was in the national
interest to encourage and speed up the development of hydro
resources and agreed that such development must be given a
very high priority by governments,federal and provincial,
both with regard to the production of hydro (including tidal)
electric power and its transmission to market. It was deemed
critical that an immediate start be made on such developments
given the long construction period required and the world oil
shortage anticipated in the 1980’s.
It was noted that Canada is fortunate in having
abundant hydro resources which could be developed economically
and which would have numerous favourable impacts on the nation
including the conservation of non renewable energy forms
such as oil and gas, a very favourable impact on the
balance of payments, security of supply and economic
growth particularly in low income and/or remote areas.

The Premiers expressed concern over the apparent Federal
government indifference and low priority given to hydro
electric development compared with other energy forms and
urged that this anomalous situation be rectified without delay,
while respecting provincial primacy over resource ownership.
Turning to the specific question of national transporta-
tion policy the Premiers endorsed the idea that in a country
as large and diverse as Canada an efficient transportation
system must be an essential tool for regional economic development
They agreed that a new transportation policy was necessary which
could be used as a means to alleviate regional disparities.
This principle should become the cornerstone of a revised
national transportation policy. They were mindful that in
developing and furthering this concept that projects and under-
takings should not be pursued which could lead to ineffici-
encies in the transportation system thereby weakening the economy.
They recognized that the principle of “user pay” should be
subordinated to the objective of regional development.
The Premiers endorsed the principles and philosophies
contained in the Hall Commission Report on Grain Handling and
Transportation. They urged the federal government to act quickly
on its implementation which they believe is in the public
interest of the entire country. By doing so the federal
government would demonstrate its support of and commitment to
the principle of using the transportation system as a vehicle
to foster regional economic development.
The Premiers reviewed the steps many of them have
already taken individually to combat unemployment.
They recognize that the primary responsibility for
dealing with the immediate unemployment problem must rest with
the federal government in view of its greater fiscal capacity.
The Premiers discussed a number of longer~term
structural economic problems which need to be addressed now.
These included:
l. The need to improve the competitive position
of the Canadian economy including comparative
wages, salaries, capital costs and tax burdens.
In this respect, the Premiers agreed that
governments must set an example in practicing
priorization and restraint in government
2. The need to improve the structure and climate of
labour relations with particular emphasis on the
public service. In anticipation of the termina-
tion of the anti inflation controls in the
country, the Premiers have affirmed the need to
exercise careful control over public spending.
As a result, the Premiers have agreed to
establish a cooperative exchange of data and

_ 3 _
information on a common basis providing inter»
provincial comparisons of public sector wages
and salaries as well as benefits.
The Premiers objective will be to assure that,
in controlling inflationary pressures, wage and
salary settlements in the public sector should
not exceed comparable settlements being made in
the private sector.
3. The need for a more aggressive trade policy and
improvements in the balance of payments situation.
In particular, the Premiers stressed the need for
a more coordinated approach to large borrowing
actions. They also expressed their satisfaction
with the convening of a federal provincial meeting
on Canada’s position in the GATT negotiations.
The Premiers urged that the mechanisms for public and
private economic policy consultation and planning be reviewed
at the next Finance Ministers Meeting.
Uncertainty caused by indecision as to the future of
the controls program was identified by the Premiers as a
serious concern. They believe that the Federal government
would serve both the short and long term economic interests
of the country by announcing a definitive termination date for
controls as soon as possible. The Premiers expressed concern
about the period immediately following mandatory control and
expressed their support for a form of monitoring agency for
both incomes and prices. All sectors of the economy including
government, management, professionals and labour are expected
to exercise restraint cooperatively to minimize the effect of
the removal of controls.
The measures set forth in this communique were
considered by the Premiers as minimal steps to improve
investor confidence in the country.

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