February 4, 2005
Premier Danny Williams address to
the Empire Club of Canada, February 3, 2005
Please check against delivery
"My Canada... Today and Tomorrow"
I would like to thank the Empire Club of Canada and the Canadian Club of Toronto
for the invitation to be here today. And, thank you all for taking the time to
try and find out what this crazy guy from Newfoundland and Labrador is all
about. It is indeed an honour and a privilege to join my fellow premiers in this
series of speeches and to share my views on Canada.
And, I would like to say I am humbled by the impressive list of world leaders
that have graced this podium from Churchill to Reagan. But I am reminded of the
wisdom of another of your speakers, Golda Meir who said, "Don�t be humble, you
are not that great." Like most Newfoundlanders and Labradorians, I truly love
Ontario. It is always a pleasure to be in Mr. Roger�s neighbourhood.
In fact, two of my staff with me here today, were drawn to the lights of the big
city and lived here for a few years. However, like most who move away from our
great province, they were drawn back to the place we dearly love to call home.
From my perspective, apart from its natural resources, I think Newfoundland and
Labrador contributes to this country a far more precious resource - some of the
most talented, gifted entertaining individuals in the world. We need look no
further than our head table here this afternoon to our own Damhnait Doyle - a
bright, energetic, enormously talented young Newfoundlander and Labradorian
taking this country by storm.
Right across the country, we start our day with Seamus O�Regan on Canada AM, and
end it in the evening with Rex Murphy on The National. We begin the week
watching the intelligent humour and commentary of Rick Mercer on Monday Report
and we finish the week enjoying the satirical wit of the talented cast of 22
Our authors are award-winning, our bright young minds lead corporations around
the world and our musicians enjoy tremendous national and international success.
Our boys from Great Big Sea are the hottest ticket in town in Boston on St.
Patrick�s Day! The endorsements do not come much better than that!
And, starting tomorrow, the defense system of this country will be under the
extremely capable leadership of native Newfoundlander and Labradorian General
Rick Hillier, the newly-appointed Canadian Chief of Defense Staff.
To understand my views on my province and our country, a country I believe is
the greatest in the world, you need to understand who I am, a challenging task
to say the least. I suspect I have left many political pundits scratching their
heads over the last number of months.
My actions, however, were motivated by a passion to strengthen Newfoundlanders
and Labradorian�s place in Canada and a need to end the threat to the survival
of our culture, a culture grounded in outport tradition and history that gives
us a distinctive character.
All my life, I have welcomed a challenge. I entered the political arena four
years ago not because it was a lifelong ambition, but because if I had not tried
to make a difference, I would have failed a province that had given me so much.
And I was on a mission.
Over the previous decades in Newfoundland and Labrador, I had built a successful
career in business and law. I founded a cable television company with $2,500
dollars of borrowed money and established businesses in the petroleum, tourism,
recreation and real estate sectors. My legal practice was a street practice
based on everything from mortgages to wills to insurance claims. My proudest
moments were successfully defending the interests of the less fortunate in major
civil and criminal litigation - the wrongfully convicted, the young victims of
sexual abuse, a woman who struck back after years of spousal abuse and a sea
captain who defended himself from a mutiny.
I learned from experience that the potential was there for individuals to
achieve personal and corporate success in our province. But, as a business
leader with my eyes wide open to what was going on in our province, I was
frustrated that so many opportunities for growth were being missed, lost or
It was common to hear people ask the same question that has always bothered me:
"Why is a province this rich in resources so poor?" Something was desperately
wrong with the picture. And I entered office determined to do something about
So, I put aside my own business interests in order to devote my attention to
making a difference in the political forum. I pledged that I would have a new
approach to governance in Newfoundland and Labrador � an approach aimed at
growing our economy for self-reliance while managing the public treasury openly
and accountably in a socially and fiscally responsible manner.
That is the agenda that motivates me everyday. It is a responsible, constructive
approach to self-reliance that is based on a new attitude of self-confidence,
pride and optimism. Our new government got a dose of reality quite soon after
being elected. Fiscally, our province was suffering severely from the
consequences of economic weakness. When I entered office, we were facing the
prospect of successive billion-dollar deficits on total budgets of about four
For a population of a half million, the situation was clearly unsustainable, and
I spent much of my first year as premier trying to manage those fiscal
challenges. But, I also understand that we cannot penny-pinch our way to
Ultimately, what we have to do is find better ways to turn our potential into an
engine of economic activity. Newfoundland and Labrador is an investor�s
paradise. It is sitting on some of the most valuable natural resources in the
world. In fact, I would venture to say that, despite our per-capita income being
the lowest in the country, our natural resource wealth, on a per-capita basis,
is probably the greatest of any province.
We brought into Confederation vast fisheries resources, forests and farms. We
brought all types of minerals � from the iron ore of Labrador West to the
nickel, copper and cobalt of Voisey�s Bay, and gold and many other minerals
still being discovered.
We brought some of the continent�s most important sources of clean hydro power,
including the as-yet-undeveloped Gull Island and Muskrat Falls sites on the
lower Churchill River, which are understandably of great interest to the
Government of Ontario among others.
And, we brought significant reserves of oil and gas that, even today, have not
been fully delineated or valued.
I think the recent dispute between Canada and Newfoundland and Labrador needs to
be assessed in the context of the last 55 years.
What has frustrated us for so long is watching our resources leave our province
with little or no processing, shipped to other parts of the country where they
create jobs and sustain communities, while our own are struggling to survive.
Richard Gwynn recently described the past conflict by stating: "What�s really at
issue is the survival of rural Newfoundland and Labrador which is the crucible
of its poetry, its songs, its stories, its tragedies, its passions, its
We are a proud people from a historically exploited area that does not want to
take advantage or to be taken advantage of.
Some time ago, a well-known Canadian, since deceased, said that Canada would be
better off if Newfoundland and Labrador was towed into the middle of the
Atlantic Ocean and sank. It is this perception of our great province that I am
committed to changing.
Our fellow Canadians need to understand that we have taken more than our fair
share of hard knocks. We joined Confederation with a significant government
surplus and, 55 short years later, our own Royal Commission, our lending
institutions and our bond rating agencies were saying that our fiscal situation
We lost most of the return on our Upper Churchill hydro-power resource to Qu�bec,
which received an outrageously-lopsided contract to buy and sell our power after
the federal government refused to grant us wheeling rights enabling us to get
the power to markets outside of Quebec. Our loss is estimated at a billion
dollars a year. The Prime Minister of the day told our premier that the price to
do otherwise could have been civil unrest in Quebec. Sounds extreme. But the
reality is that we made the sacrifice for the sake of national unity.
We lost the power to manage our fisheries when we entered Confederation, and
Ottawa used our fishery to trade quotas to foreigners for favours benefitting
other Canadians, and mismanaged some species of the domestic fishery to the
point of commercial extinction. As a result of this mismanagement, tens of
thousands of people have been forced to leave our province. Imagine, if in one
day, 300,000 Ontarians suddenly lost their jobs as a result of the federal
government�s mismanagement of their industry. It would be a national disaster.
In 1992, when the equivalent, 12,000, lost their jobs in one day in Newfoundland
and Labrador - it was a national nuisance.
During this Super Bowl week, the words of Vince Lombardi are appropriate: "It�s
not whether you get knocked down, it�s whether you get up." And, that is exactly
what we did in Newfoundland and Labrador after our fishery closed. We took a
knock, but then we got back up and diversified the fishery into a new, billion
dollar industry. But, the social impact on the province can never be recovered,
and we have lost tens of billions of dollars from a ground fishery that still
has not recovered.
Just recently, we were pleased to announce the development of one of the richest
nickel cobalt copper discoveries in the world by INCO. The construction is ahead
of schedule and on budget � a testament to the company and the many
Newfoundlanders and Labradorians employed there. However, when the ore is
processed, our province will receive less that 10 per cent of the royalties
while the federal government will receive close to 90 per cent.
So, it is against this backdrop of the fishery, the Churchill and our mineral
development that our recent dispute arose. Compounding the loss of these other
benefits was the loss of offshore oil and gas revenues.
Until now, most of the returns on offshore development have been leaving
Newfoundland and Labrador. Most of the revenues flow to Ottawa under the
equalization clawback, despite a provision of the Atlantic Accord promising that
our province would be the principal beneficiary of our offshore resources.
We led the country in economic growth year after year, largely on the success of
our offshore projects, yet the lion�s share of the benefits was going elsewhere.
Under that scenario, we would never have been self-reliant on the strength of
oil because every step forward on revenues was accompanied by a virtually
equivalent step back.
Similarly, we will never be self-reliant if we are simply a repository of the
raw natural resources that create jobs and wealth in other jurisdictions. We
will never be self-reliant unless we can do a better job of putting these
resources and revenues to work for our own communities and economy.
That is why achieving a better arrangement on our non-renewable offshore
resources has been one of my highest priorities. Last year, I proposed shielding
our own provincial share of offshore revenues from the equalization clawback. It
was a fair proposal. We have one window of opportunity to harness those
non-renewable resources for our future.
Last June, Prime Minister Paul Martin agreed to accept our proposal on offshore
revenue sharing. He recognized the fairness and equity of our proposal and, last
Friday, after many months of discussions about the details, he lived up to his
commitment. By holding out for fairness, we achieved an agreement that makes
Newfoundland and Labrador more secure and lays the foundation for future
progress. I applaud the Prime Minister for keeping his promise to Newfoundland
and Labrador and Nova Scotia.
It required leadership, courage, strength of convictions and a desire to build a
stronger nation. Mostly, it required a vision for the future of Newfoundland and
Labrador. The Prime Minister�s actions reflect the words of Franklin D.
Roosevelt: "The test of our progress is not whether we add more to the abundance
of those who have much; it is whether we provide enough for those who have too
The agreement in principle that we reached last Friday includes giving our
province 100 per cent of our provincial share of offshore revenues free from any
equalization clawbacks while we are an equalization-receiving province. It also
includes several other tremendous benefits to the province. And Canadians will
still receive more than 50 per cent of all revenues from our offshore oil and
This agreement represents a big win for Newfoundland and Labrador. But, it also
represents a win for Canada. Not only will Canada benefit from Newfoundland and
Labrador�s increasing self-reliance, but it can hold its head proudly on the
international stage for its efforts to enable Confederation�s poorest partner to
realize its potential for prosperity within the federation.
I have never believed in getting something for nothing. If there is something
you want in life, you have to go out and work hard to get it. And, in the past
several months, our team has worked very hard - and sometimes made controversial
decisions - to accomplish our goal.
The removal of the flag at the time was considered by some outside of our
province to be a setback to our cause but, from our perspective, it was
necessary. I want you all to know it was not intended to show disrespect for
this great country of ours. It was a statement to our fellow Canadians that we
had issues that were deep-rooted, that were steeped in the wrongs of the past,
that were about our survival as a people. We did not want to get out of Canada,
we wanted to get into Canada as an equal - treated with dignity.
When Prime Minister Mulrooney signed the original Atlantic Accord, he said he
was not afraid to inflict prosperity on Newfoundland and Labrador. Rex Murphy
summed it up best last fall when he said: "The infliction seems to have kicked
in; we�re still on standby for the prosperity." Last Friday, we came one step
closer to the prosperity. As a result of our new agreement, my Canada is a lot
stronger this week than it was last.
Our recent agreement could see Newfoundland and Labrador come off equalization
for two of the next eight years. What an exciting and awesome prospect to be a
contributor to the Canadian federation. Our disagreement with the Government of
Canada was not just about money. It was about pride. It was about having the
opportunity to stand on our own two feet and be financially independent. It was
about having the opportunity to grow and prosper, to stand as an equal in the
Canadian federation. You can�t put a price tag on these feelings. Pride is
something that can�t be bought and paid for with money. It is something that you
have to earn. And, Newfoundland and Labrador has earned this, believe me.
We are going to be very responsible in how we deal with our new-found monies.
Over the coming weeks and months, my cabinet will evaluate our options to
determine how this money will provide the greatest possible return to the people
of Newfoundland and Labrador. We won�t waste this opportunity.
I was delighted to read reports from Standard and Poor�s and the Dominion Bond
Rating Agency (DBRA) that suggested this agreement could potentially improve our
credit rating. In fact, DBRA said that, if this money were put down against our
debt, our interest costs would be notably reduced and our debt to GDP ratio
could fall by about 11 percentage points. That is precisely the type of analysis
we will be conducting to guide our actions.
We will also look to find ways to foster economic development, to identify where
changes are needed and pursue opportunities where they exist. And, if we can�t
see the opportunities, we will create them.
Newfoundland and Labrador welcomes investors with a host of advantages.
Our province has the unique geographic benefit of being strategically located,
poised as a natural gateway between North America and the European Union. With
our unique time zone, we can easily serve Europe and North America in the same
Seventy per cent of our work force between the ages of 25 and 44 have some form
of post-secondary education. On a per capita basis, we have the largest
available workforce in the country. New and expanding businesses have access to
a pool of over 40,000 skilled workers.
Memorial University, partnering with the province, is at the forefront of marine
technology innovation and we are world leaders in ocean technology research with
KPMG has rated our capital city as one of the lowest-cost locations to do
business in North America, Europe, Australia or Japan, and St. John's has a 14
per cent cost advantage over average U.S. cities.
Our companies score high in employee reliability, high employee retention rates,
low absenteeism and high productivity.
The award-winning EDGE program is one of the best business incentives in Canada.
The program provides a 15-year tax break, a 100 per cent rebate on provincial
corporate income tax, a 100 per cent rebate on health and post-secondary
education tax, a 50 per cent rebate on federal corporate income tax (the only
province in Canada to offer this rebate) and access to Crown land for business
set-up, relocation and expansion.
We also offer generous equity, R&D and manufacturing tax credits to encourage
and attract investors.
Do I believe in the future of our province? You bet I do!
Equally important to the prospects of our economic future, we have a great
lifestyle to offer.
Dame Judy Dench, when asked by a British newspaper what she still wanted to
accomplish in life, replied without skipping a beat: "The only thing I want to
accomplish is to go back to Newfoundland."
Anthony Wilson Smith of Macleans described it as our "youngest, coolest
province." He stated that he and his wife visited "a hotel that offers the best
service anywhere, ate dinner at a restaurant the equal of most in Toronto and
shopped at several boutiques that would sit comfortably alongside the hippest
places in Montreal and Vancouver."
I ask you, where else in the world would Kevin Spacey be asked for ID at his
film shoot�s catering truck? Where else is storytelling a competitive sport?
Where else is a 15-minute drive to work considered a long commute? Where else
can you leave the oldest city in North America and, within 30 minutes, see
whales, icebergs, wildlife, bird sanctuaries and a breathtaking ocean coastline
second to none?
There is certain joie de vivre in our province that has been given a tremendous
boost in the past week. I said earlier this is not just a win for Newfoundland
and Labrador and Nova Scotia, it is a win for Canada. Even more importantly, it
is a win for rural Canada. My Canada cannot give up on its rural roots. We must
balance the trend towards urbanization with the need to preserve the fabric of
our nation that was woven in our small communities.
Urban dwellers are retreating in droves from the hectic pace. Successful
professionals are realizing and appreciating the value of the peace, the calm,
the serenity of small town Canada. They are places for reflection. To be in the
great outdoors, the walk in the woods, the view of the ocean, the sound of the
birds - the tranquility that is missing in the big cities. Our wide-open spaces
are a valuable asset and it is not worth the sacrifice if we lose them. Rural
Canada is a national treasure and you can not put a price on that.
Stronger communities, stronger cities and stronger provinces equal a stronger
Canada. Our province embodies the dynamic of the cultural mix of a strong but
threatened rural presence with a fast-growing trend towards urbanization. This
recent initiative by Prime Minister Martin gives us the opportunity to grow and
prosper, while preserving our rich culture. It gives us a future where our hopes
and aspirations turn into reality.
Our success will be Canada�s success. I firmly believe that when you hear the
name Newfoundland and Labrador in 10 or 20 years, the words you will use to
describe our province will not be cold, foggy or poor. But prosperous, vibrant
The far east of the western world is the place to be. Today and tomorrow � a
wonderful place, I am proud to call home.
2005 02 04