Preparing Prince Edward Island ‘the better to meet its future’

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Editor’s note: The following is an excerpt from H. Wade MacLauchlan’s forthcoming book, “Alex B. Campbell, the Prince Edward Island Premier Who Rocked the Cradle.”

Alex Campbell was Prince Edward Island’s longest-serving premier, in office from 1966 to 1978. He was the youngest person elected premier in Canada in the 20th century. When he stepped down in September 1978, Campbell had been the most senior of Canada’s first ministers for six years. Along with this seniority, he was still the youngest in age.

Apart from this unusual combination of longevity and youth, what did Campbell accomplish? In economic terms, Prince Edward Island had the third strongest GDP-growth of Canadian provinces for the decade of the 1970s, after Alberta and British Columbia.

During Campbell’s 12 years in office, Prince Edward Islanders went from earning 62 per cent of the average income of Canadians to 72.2 per cent of the Canadian average, in effect closing the gap by more than 10 percentage points.

On the fiscal front, P.E.I.’s debt-to-GDP ratio was reduced from a nation-leading 35 per cent in the mid-1960s to less than 15 per cent in 1978, equal to the national average and the lowest of the four Atlantic provinces. By 1978, unemployment had been below 10 per cent for an unprecedented six straight years, and P.E.I. had enjoyed a remarkable seven years of positive net migration.

In demographic terms, the Island’s population increased by 13,000 during Campbell’s premiership, surpassing a total gain of 10,000 inhabitants for the hundred years before he took office. One fact drives home the demographic and economic optimism of the times. In the 20th century, there were 10 years when Prince Edward Island had more than 8.0 marriages per 1,000 inhabitants. Seven of those 10 years were in the 1970s.

The Campbell years were not a straight line of progress. While the era may seem like a golden age in retrospect, it was not easy and it would not have happened without leadership.

The years 1966 to 1978 can be understood in three phases. For the first 30 months, Campbell governed with a razor-thin majority and a bare-bones treasury. The middle period was a time of historic restructuring and modernization, boosted by unprecedented public resources and propelled by a demographic, economic and public policy surge. After the 1974 election, and notably with the 1975 budget, the emphasis turned to tailoring expectations.

These phases were not all-or-nothing propositions. The first three years produced one of the most impressive legislative records in P.E.I. history, while the government balanced on a political and fiscal tightrope. The final three to four years benefited from the experience and refined vision gained through the first two mandates, at the same time as Campbell’s government grappled with austerity, inflation, national economic slowdown, a global energy crisis and the accumulation of issues that come with a third term in power.

With the signing of the Comprehensive Development Plan (CDP) in March 1969, things changed for Campbell and his government — and for Prince Edward Islanders. In a February television address, Premier Campbell spoke with Islanders about the difference the CDP would make, cautioning that “this may be our last chance to provide a future for this province.” He went on to say that P.E.I.’s economic and financial condition was “precarious” and that stop-gap remedies and short-term policies “will no longer serve the purpose.”

For Campbell, the central challenge was to close the gap between “two Canadas” — a rich one and a poor one. As he told Islanders, “With each passing year our struggle to compete has become more a fight for survival. The very existence of Prince Edward Island as a province within Confederation may be in jeopardy within a very few years if we cannot reverse the present trend.”

A primary feature of P.E.I.’s transformation was a dramatic leap forward in housing. In 1970, the province launched Canada’s first Home Ownership Assistance Program (HOAP), providing 10-year forgivable loans of up to $4,000 to families to construct or purchase a new single family dwelling. More than a third of new homes constructed on the Island during the subsequent five years received assistance. In parallel, the Home Improvement Assistance Program (HIAP) provided more than 5,700 loans to assist low-income families with upgrades as basic as a basement or indoor plumbing.

Together these two programs affected more than one-fifth of P.E.I.’s total housing stock, and led to direct construction expenditures of almost $30 million in a five-year period. Over half of the recipients under HOAP were in the “twenty to twenty-nine” age bracket. In effect, the home ownership and improvement programs were savings plans, as families paid off their loans and built up equity just as P.E.I. real estate entered a decade of spiraling inflation.  

The leap forward in housing is a dramatic example of how P.E.I.’s economy took off in the 1970s and how Prince Edward Island was prepared, as Alex Campbell reflected in 2006, “the better to meet its future.”

 

H. Wade MacLauchlan is president emeritus of UPEI. His book “Alex B. Campbell, the Prince Edward Island Premier Who Rocked the Cradle,” is to be released this month by the Prince Edward Island Museum and Heritage Foundation. For excerpts and advance purchase, visit www.alexbcampbell.ca.

Organizations: Prince Edward Island Museum, Heritage Foundation

Geographic location: Prince Edward Island, Canada, Alberta British Columbia

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