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«"NO THOUGHT" OF REPUDIATION McQuesten Indicts Maclaren Contract; Party Fund Motives? Says Famed Hydro Min-- ute Is "Phony" -- Fer-- guson Signed Maclaren Contract "Because of Earlier Pledge," He De-- clares Inference of Party Funds, That the famous Quebec power pacts were a mediuim for Conservative Party campaign funds was the plain infer-- ence to be drawn from two sentences in the address of the Minister, al-- though at no time did he make such specific charges. These sentences were: "The Quebec power contracts (with an allusion to earlier 'sinews of war' looked for from the lumbering inter-- ests). involved large amounts, permit-- ting a correspondingly higher toll." "Here again (in reference to prox-- imity of the date of a contract and a general election) we have the juxta-- position of contracts that occurred prior to 1919." on his desk, "that the minute itself was a very doubb'ul factor, It is a phony minute." (Maclaren Power and Paper Com-- pany and subsidiaries, according io a slatement on The Globe's financial page this morning, report consolidated earn-- ings of $1,190,328 for 1934, as against $866,686 in 1933, due to larger de-- liveries of power by the Maclaren-- Quebec Power Company to the Ontario Hydro--Electric Power Commission.) Says Minute "Phony." Mr. McQuesten continued to charge that the famed Hydro "minute," de-- tailed to the House for the sixth time in as many days, was "phony." "I submit to you," he said as he cpened the huge Hydro minute book He reviewed the inception of the policy of purchasing Quebec power following the death of Sir Adam Beck In 1925 down to the James Maclaren contract of 1930 and declared former Premier G. Howard Ferguson signed that contract before departing for OR myself I refuse to F believe in the honesty of the Commission which approved of this (Maclaren -- Quebec) con-- tract." Hon. T. B. McQuesten, in the Legislature last night, flung this indictment at the Hydro Commission of November, 1930. Hon. George S. Henry demanded that the state-- ment be withdrawn. The Speaker, in a tense House, ruled that it was in order. of In Sir Adam's time there was the difficulty that he and his staff had recommended steam plants. '"Then occurred Sir Adam's death. The way became clear. The entire Beck policy of geonerating power from pub-- ilicl,v owned plants was done away with." but Beauharnois Mr. McQuesten said the Govern-- ment also awaits the decision of the people in the matter of repudiation of the contracts. The Maclaren--Quebec contract, he said, was not signed until the fall of 1930, when a depression and a de-- crease in power demand were well evi-- denced on the horizon. This fact drew from the Minister his statement that he would not believe in the honesty of the Commission. The Minister said that there were no contracts between 1926 and 1929 The Minister opposed demands of the Opposition for immediate deci-- sion regarding the power contracts because too many immediate deci-- sions have been made in the past. "About repudiation we have no| thought," Mr. McQuesten said. "We| wait for the people of this Province to see about this." Contracts Reviewed. but Beauharnois negotiations had en-- sued as the 1929 election loomed. Mr. McQuesten further attacked the former Premier by charging "sup-- pression" of _ the <supplementary Gatineau agreements in 1926, was "nothing short of criminal." Bit by bit the Hepburn Government Minister and Hydro Commissioner re-- viewed the making of the power con-- tracts, leaving the implication that they might have succeeded timber concessions as the medium for "sinews of war." "Sir Adam was a just man and a business man," said the Minister. "He had some sense of his responsibility as Commission head." "Into Hands of Ferguson." "With Sir Adam's death," Mr. McQuesten charged, "the Commis-- sion ceased to function." The power went into the hands of Hon. G. Howard Ferguson. ""'The records show it,"--~Mr. McQuesten declared. Sir Adam Beck had proceeded with care when he was studying Hydro's problem. Reports were asked for and obtained. The Commission itself studied the matters involved. warned repudiation would bring seri-- ous consequences to the Province. The Minister and third Hydro Com-- missioner broke sharply into his im-- plicating comment about the powers that made the Quebec contracts. The Commissioner launched into history which ended in an attack by implication on the Government of the contract day. Prior to 1919, he said, the lumbermen of the North were the companies "to which our friends looked for the sinews of war." Farlier in the day G. H. Challies (Conservative, Grenville--Dundas) had "The Quebec power contract," thundered the Minister, '"involved large amounts, permitting a corre-- spondingly high toll." The Abitibf connection with former Premier Ferguson, when he was Min-- ister of Lands and PForests, was de-- scribed in detail. "Whatever were the motives lead-- ing to the three Quebec contracts. they had nothing to do with the merits of the bargain or the true in-- terests of the people of Ontario." March ¢ | In a tensely quiet House, Mr. Speaker ruled that the honorable | member for Hamilton was in order. ] Of Mr. Magrath, he declared that during the five years "in which he was engaged in wrecking Hydro" ho had fulfilled Mr. Ferguson's hopes. "I suggest," said Mr. McQuesten, "that there was a suppression of the | truth narrowly short of fraud, because | he had a duty to publish it." The secret agreemeonts were analyzed --particularly the agreement protect-- ing the company in case of Quebec action. Power shortage would rise again on a country--wide scope. Que-- bec--not spitefully--might bar power exports, he said. Develop Own Power. "Is the member asking that a statement be withdrawn?" the Speak-- er qusried. "There was no excuse for such a contract," declared the Minister. "The revenue of the Niagara Sys-- tem increased only $914,000 in the eleven months ending in September, 1930." Increased cost of Quebec power was quoted at more than $2,-- 000,000 in the same period. "In November, 1930," said the Min-- ister, "the Commission was free, and, had it mwintained this freedom, the Niagara System would have been saved some $72,000,000--for power unused and unused still. The forces hastening the contract were too strong." Business indexes were going down "For myself, I refuse to believe in the honesty of the Commission which approved of this contract." "He was continually pulling Mr. Ferguson's chestnuts out of the fire. He is not the first person in public life whom that astute gentleman used in that way. He departed without being missed." '"Here again,' said the Minister, "we have the juxtaposition of con-- tracts that occurred prior to 1919." There woere no contracts between 1926 and 1929. As the 1929 elec-- tion drew ncar, "negotiations with the Beauharnois group ensued." '"The Maclaren deal was rusned to completion. "And that was the atmosphere," said Mr. McQuesten, "in which they sought to sign the Maclaren contract." Further there had been a Hydro minute showing that the Commission considered--in view of a Quebec atti-- tude--that cancellation of the con-- tract should be sent. Hon. Gcorge S. Henry rose and de« manded withdrawal. "I certainly object to it and ask for its withdrawal." The Speaker in-- sisted that the former Premier repeat the words to the Clerk of the House. "Did the friends opposits know the terms of the business? Were they supplementary agreements read to them? I want to know, and the pub-- lic wanus to know." "In many ways," said Mr. McQues-- ten, "this contract represents the most disgraceful of all the Quebec con-- tracts." It was signed, he explained. when the power demand was already slowing up. '"Why was the Premier (Mr. Mc-- Questen made it plain that he was referring to Mr. Ferguson) so inter-- ested in these negotiations? If he had been an officor of any industrial corporation, he would have been flung out of office." No Excuse, He Says. Back to the allegedly secret con-- tracts. "Perhaps our friends will enlighten us as to what these obvious reasons aro." There had been "obvious reasons according to Mr. Magrath." "When Mr. Ferguson announced the Government agreements neither of the secret agreements was executed. If they had been announced they would not have been executed." It had been rushed to completion. It was a time when (fall of 1930) storm signals were flying for industry. "We should face the situation while we have a breathing space," the Min-- ister suggested. There was plenty of