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Airspace revenue for Newfoundland and Labrador an unfounded story circulating since Confederation: researcher

Retired engineer David Fox points to a chart with numbers he has compiled and calculated for each year since Newfoundland and Labrador’s confederation with Canada on airspace revenue he believes the province is owed.
Retired engineer David Fox points to a chart with numbers he has compiled and calculated for each year since Newfoundland and Labrador’s confederation with Canada on airspace revenue he believes the province is owed. - Glen Whiffen

Ed Hollett doesn’t believe Newfoundland and Labrador is owed any money for the use of its airspace since Confederation, as was suggested by retired engineer David Fox in Wednesday’s Telegram.

In fact Hollett, senior research fellow for the Atlantic Institute for Market Studies (AIMS), said Fox has it wrong in suggesting that airspace was an asset not included in the Terms of Union between Canada and Newfoundland in 1949.

“It’s an old story. It’s been around a long time,” Hollett said. “There are a number of these stories that go around about Confederation. The one about airspace has been kicking around for most of the last 20 or 30 years, this idea that somehow somebody missed something and we are owed billions of dollars in untapped money. The simple answer is it was never left out of the Terms of Union.”

In Wednesday’s Telegram story, Fox claimed his research shows that Newfoundland and Labrador has continued to be the sole owner of its airspace since 1949 and that the federal government has collected about $19.7 billion, including interest, in revenue from the use of the province’s airspace since then. If the provincial government split that amount 50/50 with the federal government — because the federal government is responsible for aviation services — the province would still be owed $9.85 billion, Fox said.

“Term 33 of the 1949 Terms of Union itemized the exact public works and property of Newfoundland which, upon Confederation, would become the property of Canada,” Fox said. “Term 35 stated that ‘Newfoundland public works and property not transferred to Canada by or under these terms will remain the property of the province of Newfoundland and Labrador.’”

Fox said that in light of the province’s present financial situation, the provincial government should investigate it because, “Newfoundland and Labrador is owed billions retroactively, and hundreds of millions annually.”

Hollett, however, said that under Term 3 of the Terms of Union, Newfoundland was to become part of Canada in the same way the other provinces did, with the constitution applied, except for changes specifically outlined in the Terms of Union.

“That means that because there is no reference to airspace or any other territory of Newfoundland and Labrador being treated differently, it all became federal,” Hollett said. “Basically, whatever is federal is federal and what is provincial is provincial. So airspace is part of the territory of the country as a whole, the same way as the territorial sea is under control of the country as a whole. From a legal standpoint, airspace is the same as territorial sea.

“(Fox’s theory) starts from a mistaken premise, and as passionate as he is about it, and as diligently as he has been in documenting it in as much detail as he has, it is absolutely irrelevant.”

Fox said Newfoundland’s sole ownership of its airspace goes back to the “Chicago Convention” in 1944, which Newfoundland representatives attended as part of the United Kingdom delegation. The United Kingdom signed the agreement creating the International Civil Aviation Organization that set international aviation rules.

Newfoundland, through the United Kingdom, retained sole sovereign ownership of its airspace, Fox said.

Hollett says the Chicago Convention has no bearing on the airspace ownership issue.

He said Newfoundland had also, prior to 1949, signed other international agreements, such as the International Radio Convention.

On April 1, 1949, because the Canadian Constitution then applied to Newfoundland, all such agreements became a federal responsibility, Hollett said.

Hollett said Fox’s take on the airspace story is the most detailed he has seen. Still, it’s one of the stories that continue to resurface since Confederation, he said.

“One of my favourites is that the (Labrador) border is under threat. Quebec puts out a map that shows a different border than the real one and everybody goes up in arms, and they write people and they are screaming on the open-line shows about it,” Hollett said. “The border was settled in 1927 and it isn’t moving one inch.

“Some of the more extreme stuff has worked its way into movies like ‘Secret Nation,’ where the idea is that ballot boxes were destroyed and the vote was actually the other way. There are all kinds of these stories.”

With regards to the airspace theory, he noted, even if Fox was right, “there’s no big cash pile sitting there waiting. All the money collected by the federal government for these fees go to Nav Canada.

“The fees collected go back into air navigation, so that’s what pays for Nav Canada and air traffic control and radar systems, and weather monitoring.”

Nav Canada, formed in 1996, is the company that owns and operates Canada’s civil air navigation service.

Fox, meanwhile, remains undeterred. He has been doing his research for the past 20 years and has made presentations to members of the provincial government and others in the past. He hopes his research will start a conversation and prompt the provincial government to look into it.

The Telegram has made a request to the province’s Department of Finance for a response to Fox’s claims, but has not received a reply.

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